Co-op, the consumer co-operative group, has announced their annual results for 2017 today. The group, which has interests across food, funerals, insurance, electrical and legal service, reported a pre-tax profit of £72 million, a sharp comeback from the loss of £132 million in 2016 as a result of the write down of stake in the crisis-hit Co-operative Bank.
Underlying profit before tax of £65 million is an increase of 25 percent from 2016 (£52 million). The firm clocked £9.5 billion in revenue, same as the previous year.
The food sector has seen an annual growth of 3.4 percent in like-for-like sales and the core convenience LFL sales went up by 4.3 percent, for the fourth consecutive year. However, revenue from sector remained flat at £7.1 billion, reflecting impact of strategy to close larger stores. Wholesale sales to independent societies went up 7 percent to £1.7 billion.
The firm has said that further pricing reductions are planned for this year, in addition to the £50 million investment to reduce prices announced in January 2018.
The group will see an expansion spree this year. The acquisition of Nisa Retail, the wholesaler and convenience retailer, for up to £137.5 million awaits regulatory approval. Agreement to become exclusive wholesale supplier to Costcutter Supermarkets Group (CSG) and the 2,200 Costcutter, Mace, Simply Fresh, Supershop and kwiksave convenience stores across its network from spring 2018 is also in place. Further expansion of convenience store estate is also on the anvil, with 100 new stores planned for 2018.
Steve Murrells, Chief Executive of the Co-op, said: “Today’s results show how much progress we have made. All our businesses have performed well and we have increased profits and reduced debt, while continuing to invest for colleagues, members and customers.
“The success we are enjoying shows that the Co-op’s difference really resonates today – a different ownership model and a different approach to business, based on returning profits to our members and their communities.
“We’re delighted with our performance, but we’re hungry for more and ready to create the Co-op of the future. Whether it’s in our existing business areas or through new ventures, we want to make the Co-op ever more competitive, relevant and innovative. … We are going to deliver more Co-op products and services to more people throughout the country and that is what will really allow us to spread our difference.”