John Lewis says interest rate rises and deflation has affected sales

The firm, which operates 26 department stores, saw 1.6% like-for-like sales growth in the seven weeks to 8 January compared to last year.

John Lewis said it was "more than satisfied" with the figures which include sales through its online and catalogue arm John Lewis Direct.

Waitrose, the John Lewis owned grocer, enjoyed 3.6% like-for-like growth.

Like for like figures exclude returns from stores opened over the period.

Challenging conditions

The festive period has proved extremely tough for many of the High Street's biggest names with Marks & Spencer, House of Fraser, Woolworths and Ottakar's all delivering disappointing trading results in recent days.

It has been and continues to be a challenging trading environment Gareth Thomas, John Lewis

John Lewis - which is owned by its staff - said it believed it had delivered a creditable performance given the difficult trading conditions.

"It has been, and continues to be, a challenging trading environment affected by a succession of interest rate rises, a flat housing market and high energy costs," said Gareth Thomas, the firm's director of retail operations.

"With the added effect of deflation on the retail economy, it is clearly unrealistic to assume large automatic year-on-year growth in sterling figures which makes these results particularly encouraging."

Waitrose growth

John Lewis saw strong growth in sales of womenswear, menswear and beauty products although sales of electrical goods and home technology were flat.

The group said sales over the past six months - comprising the period between 25 July and 8 January - had been 1.7% ahead of last year.

Waitrose recorded overall sales growth of 18.2% over the same period.

Its figures were boosted by the addition of 23 new stores over the past year, including 19 outlets bought from Morrisons.