Sharon White, chairman of the department stores and supermarkets group, told reporters on Thursday that staff - or partners as the group calls them - should not expect a bonus next year either, but that the business would survive.

"The Partnership found itself in a similar position in 1948 when the bonus was halted (for five years) following the Second World War. We came through then to be even stronger than before and we will do so again," she said.

The COVID-19 pandemic has destroyed many retailers in Britain that were already struggling with high rents and taxes. The partnership made a first-half loss of 635 million pounds.

The impairment charge reflects a rapid change in consumer behaviour during the pandemic, which has accelerated a shift away from shopping in stores to buying online.

Excluding total exceptional items of 580 million pounds, the employee-owned group made a first-half loss of 55 million pounds, similar to last year.

The temporary closure of stores during a national lockdown and shoppers' focus on low-profit essentials, such as toilet paper, hit overall trading.

Operating profit fell 46.3% at John Lewis department stores in the six months to July 25, but was up 10.6% at Waitrose supermarkets.

With online sales now accounting for 60% of the department store total, from 40% before the crisis, the partnership has already said it must diversify beyond retail to survive.

The challenge falls to White, a former head of media regulator Ofcom, who took charge earlier this year. She will set out the results of her strategic review next month.

The group is keen to bring in partners who share its ethos and Waitrose recently teamed up with food delivery firm Deliveroo, having ended ties with Ocado.

"We've also made it very clear that ... a red line for us within our strategic review is we're not going to be selling either brand," White said.

The group is sticking with a worst case scenario - set out in April - under which full-year sales would fall 5% at Waitrose and 35% at John Lewis. It believes the most likely outcome will be a small loss or a small profit for the year.

(Reporting by Kate Holton and James Davey; editing by Emelia Sithole-Matarise and Mark Potter)

By Kate Holton and James Davey