The Co-op has demonstrated resilience by returning to profit despite challenges posed by increased shoplifting and market pressures.
- The group’s pre-tax profits reached £58m in the first half, contrasting last year’s £33m loss.
- Sales in the food business increased by 3.2% to £3.7bn with a solid performance in both physical stores and online platforms.
- Membership base expanded by 20%, aligning with Co-op’s strategic goals for 2030.
- The retailer set ambitious expansion plans with 120 new stores targeted by the end of 2025.
Despite a surge in theft and fraud costs, reaching £39.5m due to an ongoing shoplifting epidemic, the Co-op has managed to rebound into profitability. Group pre-tax profits increased significantly to £58m for the first half of the year, marking a substantial improvement from the £33m loss recorded during the same period last year. This rebound is especially noteworthy against the backdrop of a contracting food retail convenience market, suggesting an effective adaptation of strategies to current economic conditions.
Sales within the Co-op’s food sector increased by 3.2%, reaching £3.7bn, supported by strong performances both in-store and online. This growth occurred despite the company incurring £39m in wage hikes as part of its commitment to the Real Living Wage, and investing £55m to maintain competitive pricing. Notably, the food underlying operating profit increased by 10% to £85m, underscoring the company’s robust operational efficiency in a challenging market landscape.
The Co-op also reported a significant expansion in its membership, with a 20% increase to 5.5 million active member owners. This growth is a strategic move towards achieving the company’s target of 8 million members by 2030, reflecting its commitment to building a broad and engaged community base. The increase in membership base signals a positive response to the brand’s value proposition and efforts to enhance customer loyalty.
Chief Executive Shirine Khoury-Haq remarked, “We have delivered a strong performance for the first six months of this year as our strategy starts to gain real momentum.” She highlighted the efforts to outperform market competitors while investing in staff, pricing, and business growth, showcasing a balanced approach to navigating a challenging economic environment.
Looking forward, Co-op has set its sights on further expansion with plans to open 120 new stores by the end of 2025. This ambition is indicative of the company’s proactive stance in increasing its market footprint and staying competitive in the evolving retail landscape. The strategy focuses on reaching more members and enhancing its food offering, aligning with its long-term growth objectives.
The Co-op’s strategic adaptability and robust performance amidst challenging conditions underscore its potential for sustained growth.
