Although department store group John Lewis saw total sales rise 2.5 per cent to £1.42 billion in the six months to July 30, its operating profits fell by a massive 54.5 per cent to £15.8 million - £18.9m down on the same period a year ago.

Charlie Mayfield (pictured), chairman of parent company the John Lewis Partnership, which also includes the grocery chain Waitrose, said profits were hit by John Lewis’s commitment to its “Never Knowingly Undersold” promise as well as a highly competitive trading environment.

Like-for-like sales for the department store business were one per cent up, but, despite challenging trading conditions, Mr Mayfield pointed out that the store group won market share in its three key categories – electricals and home technology (where sales grew by 3.8 per cent), home and fashion.

“Our very successful multichannel and online operations have been at the heart of John Lewis's performance,” said Mr Mayfield.

“All three John Lewis markets were instrumental in driving sales in this area, with johnlewis.com outperforming its market and seeing 27.2 per cent growth.

“This has been achieved,” he said, “through increasing the number of products and brands sold online, investing in distribution and developing the 'Click and Collect' option which allows customers the choice of picking up their online purchases from all 32 John Lewis and 24 Waitrose shops.”

He added that the popularity of ‘Click and Collect’ has prompted the retailer to more than double the number of collection outlets to 116 from next month. These will include collection points in 84 Waitrose branches, and, he said, more are being planned.

“Johnlewis.com already accounts for 19 per cent of total John Lewis sales,” said Mr Mayfield.

“There is considerable opportunity for growth in the online operation, and our expectation is that johnlewis.com will be achieving sales of £1bn by 2014. This will be bolstered by the new online international operation which began delivering abroad in June and is now live in 33 countries.”