Co-op has returned to profitability despite significant losses due to shoplifting and fraud.
- The group reported a £58 million pre-tax profit for the first half of the year, recovering from a £33 million loss the previous year.
- Sales in Co-op’s food business increased by 3.2%, reaching £3.7 billion, with a strong performance observed both in-store and online.
- Despite the rise in theft and fraud-related costs to £39.5 million, Co-op’s underlying food operating profit rose by 10%.
- Co-op plans to expand its store network with 120 new locations by 2025, aiming to enhance its market presence and member engagement.
Co-op has demonstrated a resilient financial performance by swinging back to profitability. The company managed to achieve a pre-tax profit of £58 million in the first half of the year, a significant improvement from the £33 million loss recorded during the same period in the previous year. This turnaround is particularly notable considering the rising costs associated with shoplifting and fraud, which increased by 19% to £39.5 million.
In the food business segment, Co-op experienced a sales growth of 3.2%, totalling £3.7 billion. This growth was supported by robust performances both online and across physical stores. The company also saw a 10% increase in underlying food operating profit, which reflects its effective cost management and strategic pricing adjustments. Notably, Co-op absorbed £39 million in wage increases as part of its commitment to the Real Living Wage, alongside £55 million in price investment.
Co-op’s performance in the first half of the year surpassed the convenience market by 7.4 percentage points, according to data from Circana. The increase in the number of active members to 5.5 million, a rise of 20%, has also positioned the company closer to its target of 8 million members by 2030. These gains indicate Co-op’s strategic initiatives are gaining traction despite challenging external conditions.
Looking ahead, Co-op has outlined plans to expand its footprint by opening 120 new stores across its retail and franchise operations by the end of 2025. This expansion strategy is aimed at broadening Co-op’s reach and enhancing its food offering to a wider audience. The CEO, Shirine Khoury-Haq, acknowledged the challenges in the external environment but expressed confidence in Co-op’s ability to outperform market expectations.
Khoury-Haq stated, ‘We have delivered a strong performance for the first six months of this year as our strategy starts to gain real momentum. Although the external environment remains challenging, it is testament to the underlying strength of our Co-op that we have outperformed in all our markets while significantly increasing our investments in our colleagues, pricing and in the growth of our businesses.’
Co-op’s strategic initiatives and effective management have enabled it to navigate external challenges and achieve a robust financial recovery.
