Profits at the Manchester based Co-op halved last year with the the group warning of problems continuing into the next financial year
Total group revenue was up £0.3bn to £11.2bn against pre pandemic levels but was down slightly year-on-year, reflecting unprecedented Covid-related sales in 2020 and the impact of significant supply chain disruption
Profit before tax of £57m, up £33m on pre pandemic but down £70m on last year with one-off £99m gain from early settlement of the Group Relief owed to Co-operative Bank PLC.
The group invested £140m in opening 50 new stores and refitting 87 more, and spent £18m on cutting prices.
While in-store sales declined, online sales soared from £70m the year before to £200m thanks in part to tie-ups with Deliveroo and Amazon.
Looking ahead, Co-op expects to face continued challenges during the year, including the final implementation of the business transformation in Food, current inflationary pressures and the economic uncertainty facing customers, members and colleagues.
Allan Leighton, Chair, Co-op said:
“The past year has been a challenging one for our Co-op, but we continued as planned with our investment strategy to strengthen our Co-op’s future state.
“I would like to thank our colleagues across the business whose passion and support continues to inspire and drive us forwards.
“We would all like to thank Steve Murrells for his outstanding contribution to our Co-op over the past 10 years and congratulate Shirine Khoury-Haq on her appointment.
“The economic headwinds look stark and will be tricky to navigate but through our continued planned strategic investments our Co-op is well placed to ride out the storm and prosper beyond.”
Shirine Khoury-Haq, Interim Chief Executive, Co-op said:
“The Co-op is a business designed for the long term and that is the path we are on. The last year has seen us facing some significant challenges, including significant supply chain issues in the second half coming at the same time as our Food business transformation and increasing inflationary pressures. The difficult operating environment disproportionately impacted our Food business, given its focus on the community convenience market, with an operating model that is more reliant on flexibility in the supply chain.
“The Co-op remains uniquely positioned. We continue to be driven by our vision of co-operating for a fairer world and have a platform of businesses in the right markets to drive change, and get closer to our members, customers and communities. The significant investment we have made across our business in recent years now provides the basis for us to move forwards in a more efficient manner.
“As we look ahead, our focus must be on accelerating growth in our Food business through our four routes to market, whilst expanding our Life Services businesses, from Funeralcare to Insurance and Legal Services. We must also ensure our businesses are there for our members, customers, communities and suppliers who are experiencing the effects of the cost-of-living crisis, as we continuing to focus on our Honest Value range in Food and affordable services across Life Services.
“I am delighted to be leading this unique business and look forward to working with all our colleagues to take our Co-op to the next phase of its development.”
