Retailer John Lewis Partnership has said it will not pay a staff bonus for the third year in a row despite seeing annual profits triple.

The employee-owned business, which runs the department store chain and Waitrose supermarket arm, saw underlying profits rebound higher to £126 million from £42 million the previous year.

On a reported basis, it posted a 73% jump in pre-tax profits to £97 million for the year to January 25.

But the group said it would not pay out a bonus once again for its workforce of around 69,000 people, instead saying it would prioritise another £114 million in overall pay and up to £600 million of investment in the business.

We have made good progress with much more still to do

It said: “After careful consideration, we have prioritised this investment over sharing a bonus this year.”

Jason Tarry, who took over as chairman of the John Lewis Partnership from Dame Sharon White last September, told the PA news agency he was “determined to pay a bonus as soon as we possibly can”.

“Now just isn’t the right time,” he said.

He declined to say if the bonus would be reinstated for the current financial year, despite forecasting another rise in profits.

“That will be something we review given the situation we find ourselves in, in a year’s time,” he said.

The profit bounceback comes after a widespread overhaul at the group to strip out costs and boost flagging sales at the department store chain, with the group revealing another £255 million of savings over the past year.

Outgoing chief executive Nish Kankiwala – who leaves this month when his role is taken on by Mr Tarry alongside his position as chair – said a “few hundred” roles were cut in the past year, though he said this was largely managed through not replacing staff when they left and redeploying workers.

Mr Tarry said he expects the workforce to shrink again in the year ahead through staff turnover and redeployment, but declined to say how many roles would go.

“We will continue to look at productivity savings going forward,” he said, adding the group was “still working through the plans”.

The group said the wider economic backdrop would “be challenging for our customers and our business”.

It is set to take a £45 million hit from the increase in national insurance contributions next month.

Mr Tarry told PA he does not expect to raise prices to offset this, instead offsetting the extra wage costs through savings and growth.

He said: “We have made good progress with much more still to do.”

“This will involve considerable catch-up investment in our stores and supply chain,” he added.

The annual results showed sales at John Lewis remained flat on the previous year, at £4.8 billion, while Waitrose saw sales rise 4.4% to £8 billion and underlying earnings jump £122 million to £227 million.

The group said after earnings fell at the department store in the first half, they grew by £8 million in the final six months as sales lifted 3% thanks to turnaround efforts, with underlying operating profits standing at £45 million overall for the year.