The Co-operative Group achieved further financial progress in the year to January 4, 2020, which it says has helped it support its customers and communities during the current coronavirus pandemic.
The Manchester-based group – which was among the first to respond to the COVID-19 crisis by fast-tracking 5,000 new jobs in its stores division in March – today (April 24) reported total revenues of £10.9bn for the fiscal year, which is a seven per cent improvement.
Pre-tax profits of £79m compared with £83m the previous year. The group underlying profit before tax, excluding IFRS 16 impact, up 50% to £50m, driven by a strong performance from food, where revenues rose three per cent to £7.5bn.
Like-for-like food sales were up 1.9%, which means the Co-op has now delivered six years of like-for-like food revenue growth.
Net debt reduced to £695m, excluding lease liability, from £764m in 2018.
In food, the group opened 79 stores, refitted 152 stores and extended 10.
There was also a successful trial of home delivery, which means delivery options will now be expanded, with online same-day services made available across almost 100 towns and cities, served by 650 Co-op stores, with delivery options including Deliveroo.
The group said the market for its funeral and lifeplanning business remained challenging, although it has a clear turnaround strategy in place. Revenues declined three per cent, reflecting continued investment in price reductions with lower-cost funerals and a lower death rate.
Legal services revenues increased 13% to £40m.
The group also re-entered the life insurance market. Its member-designed cover offers payment holidays for those in financial difficulty, while it introduced innovative a safe driving policy for young drivers, with savings of more than £1,000.
The sale of CIS General Insurance is ongoing and insurance underwriting is treated as a discontinued business to reflect this process.
Today’s report also revealed that the group created temporary jobs for more than 7,000 people out of work as normal workplaces closed due to the pandemic, and all posts were filled within seven days.
And the Co-op delivered £1.5m of food to FareShare and donated Easter TV
advertising to the charity in support of food banks.
Active membership of the Co-op movement now stands at 4.6m following a successful focus on driving young membership, with 36% of new members aged 35 or under.
The group said that, with the continued COVID-19 outbreak and other factors, the outlook is uncertain.
It expects additional costs associated with COVID-19 to be in excess of £200m, which will, in part, be offset by increased food sales and the expected business rates relief announced by the Chancellor.