WAITROSE believes it has benefited from the horse-meat scandal, as the upmarket grocer contributed to a 15.8% leap in profits at parent John Lewis Partnership, allowing the employee-owned business to award staff bonuses worth 17% of their annual salary.

Workers lined the balconies at John Lewis's Oxford Street store in London yesterday to see chairman Charlie Mayfield reveal the payout for the year to January 26, with similar, if lower-key, scenes across the group's 38 other stores and 290 Waitrose outlets.

There are John Lewis stores in Edinburgh, Glasgow and Aberdeen, employing 1578 people. Waitrose has a 1000-strong workforce north of the Border.

"We see this as a time of opportunity in a market which we think will continue to be growing slowly and is probably looking slightly better than it was a year ago," Mr Mayfield said, adding that both businesses had gained market share for the fourth year.

He talked of a "quiet revolution" that pushed online sales to just below £1 billion or around one-quarter of John Lewis's revenues.

The £210.8 million pay-out, an increase on the 14% paid last year, is equal to nearly nine weeks' pay for its 84,700 workers, or around £4000 for an average full-time employee.

The group posted a £55.8m increase in profits before bonuses and tax to £409.6m for the year to January 26.

Andy Street, managing director of John Lewis's department stores, insisted it was not inappropriate to unveil the payout weeks after revealing plans to cut 325 positions and shift 500 roles from London to Milton Keynes. He said: "No business can stay with the same type of jobs in the future that we have now."

Waitrose, which opened its fifth Scottish store in Stirling two months ago, overcame a lacklustre grocery market to record like-for like sales growth of 3.4% after promising to match market leader Tesco's prices on branded goods. Its operating profit was up 12.2% at £292.3m.

Waitrose managers think it has benefited from the discovery of horsemeat in some foods sold elsewhere.

Waitrose managing director Mark Price said: "Since that issue blew up we have continued to grow strongly. We have outperformed the market by more than we [had been]. We still passionately believe that you get what you pay for. The price ticket at the front of a good is a pretty good indication of the quality of what you are buying."

Tests found pork in some of Waitrose's frozen meatballs made in Glasgow. Mr Price said it has since established freezing facilities at its beef abattoir.

A distribution centre will open in Lancashire in April. This will halve distribution costs to its Scottish stores, bringing them in line with the rest of the UK. "We will be able to open more space in the north [of England] and Scotland," Mr Price said.

Building work has started at a store in Helensburgh, Argyll and Bute, with other sites being looked at.

Meanwhile John Lewis's department store arm added market share in fashion, home and electrical as its like-for-like sales grew by 10.5% over the year.

In the first five weeks of the new financial year, Waitrose's like-for-like sales were up 4.6% and those at John Lewis ahead 13.7%.