Department store's sales soar by 7.6 per cent

The department store group John Lewis has emerged as one of the big winners of the Christmas battle on the high street after underlying sales soared 7.6 per cent over the past five weeks.

Following a barnstorming performance in the rest of 2010, the festive trading update puts the 32-store retailer on track for record sales – and possibly profits – for its financial year that ends this month.

While John Lewis expects a more modest performance this year, the retailer is also "budgeting for growth" in 2011 and does not subscribe to the "doom and gloom" outlook for the sector in the wake of the squeeze on consumer spending.

The department store chain – which along with the grocer Waitrose forms the John Lewis Partnership (JLP) – topped a number of company records in the five weeks to 1 January.

These included its best weekly sales of £121m, its biggest day at £27.8m and record days at a number of individual stores. Andrew Murphy, the retail director at John Lewis, said: "We are increasingly getting the sense that looking at competitors' numbers we are taking market share, although we are still quite early in the Christmas reporting season."

John Lewis cited sales growth of 14.4 per cent in electricals and home technology, an 8.7 per cent leap in fashion, including beauty, and a 4.7 per cent rise in home, over the five weeks, as categories where it believes it has grown market share.

Mr Murphy said: "We are budgeting for growth in John Lewis this year. The distance between the winners and losers in UK retail will continue to be quite pronounced." Online sales soared by 42 per cent over the past five weeks, helping annual revenues from John Lewis's website to pass £500m for the first time, in just 11 months.

Andy Street, the managing director of John Lewis, said: "Online sales soared during the first snowfall as customers struggled to get to the shops. When the weather turned for a second time closer to Christmas, shoppers wanted the reassurance of having their goods in their hands and our shops saw sales surge as a result."

While Mr Murphy would not be drawn on figures, it is thought that John Lewis is targeting sales growth of about 4 per cent this year.

He said: "Overall, we don't subscribe to the doom and gloom philosophy on 2011. Modest sales growth will be the order of the day rather than people fighting for their lives."

JLP delivered pre-tax profits, before staff bonus payments, of £307m in the year to 30 January 2010. Given strong sales at Waitrose and John Lewis so far in 2010, this year's figure could come close to the record £379.8m profits delivered in 2008.