John Lewis explains it’s ‘not possible’ to counteract fallout of no-deal Brexit
The John Lewis Partnership has warned that the damage a no-deal Brexit would do is "significant" and impossible to offset as it fell to a £25.9million half-year loss.
John Lewis said while it was doing everything it can think of to prepare for a possible no-deal, it could not entirely protect itself.
Sir Charlie Mayfield, outgoing chairman of the John Lewis Partnership, said: "Should the UK leave the EU without a deal, we expect the effect to be significant and it will not be possible to mitigate that impact.
"In readiness, we have ensured our financial resilience and taken steps to increase our foreign currency hedging, to build stock where that is sensible, and to improve customs readiness."
But he warned that Brexit "continues to weigh on consumer sentiment at a crucial time for the sector as we enter the peak trading period".
His comments came after the Government was forced to release its "worst-case scenario" plan for a no-deal Brexit, codenamed Operation Yellowhammer.
It showed that no-deal could trigger medical shortages, food price rises and major cross-Channel trade delays.
Results from John Lewis showed that it slumped to an underlying pre-tax and bonus loss of £25.9million for the six months to July 27 – against profits of £800,000 a year earlier – as it said trading conditions had remained "difficult" and would continue to be challenging over its peak sales period.
The partnership said it was driven into the red by widened operating losses at its John Lewis department store chain, which increased to £61.8million from £19.3million a year ago as it suffered falling sales, surging costs of an IT overhaul and increasing cost inflation.
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