John Lewis is owned by its staff

The department store group and owner of the Waitrose supermarket chain made a pre-tax profit of �146m in the six months to 28 July.

Same-store sales at its John Lewis branches rose 6.4% from a year earlier, while those at Waitrose added 3.2%.

John Lewis is a partnership which is co-owned by its workers.

It said sales in the second half of 2007 were already more "subdued", as UK interest rate rises hit home and consumers became more cautious.

"The outlook in the market is more challenging than has been experienced for some time and we expect a tougher trading environment in the coming months," the firm said in a statement.