Peter Lewis, chairman of the department stores and Waitrose supermarkets group, blamed 'the worsening retail picture'.
Mr Lewis attacked the Government for failing to crack down on unlawful Sunday opening. Waitrose was suffering as a result, he said. 'It must be the first sales tax ever exacted for keeping the law, and handed over for the benefit of the delinquents.'
The slack housing market, particularly in the South-east, also had an impact.
Sales in the 22 department stores in the six months to 25 July were flat at pounds 501m, the first time they have not grown for decades.
Waitrose managed a 4 per cent increase to pounds 574m, thanks to new store openings which have boosted the chain to a total of 99 stores.
Trading profits fell only 5 per cent to pounds 38m but a 12 per cent increase in the interest bill to pounds 12.1m left the group with a smaller surplus. Staff are paid their annual bonus out of this surplus, after tax, preference dividends and reinvestment in the business.
The bonus will depend on the second-half contribution too. Mr Lewis warned: 'If we conjure up no better sales figures for the second half, then we shall have no better profit results either for the year as a whole. But there is every chance the partnership can do better than that, and the experience of the department stores since the beginning of August has been encouraging.'
The bonus is an important component of pay. It rose as high as 24 per cent of salary in the mid-Eighties, but has fallen ever since. It was cut from 12 per cent to 9 per cent last time.
Earlier this year Mr Lewis said that the policy on Sunday opening of the Home Secretary at the time, Kenneth Baker, was 'a disgrace to the Home Office'.Reuse content