UK retailer Co-op has reported underlying operating profit growth of £44 million (€50.9 million) in the first half of its financial year, from a loss of £1 million (€1.2 million) in the same period last year.
Co-op UK added that its performance was driven by cost-saving measures implemented by the company in streamlining operational processes and realising the benefits of lower costs due to previous investments in supply chain infrastructure and IT systems.
The company saw revenues down marginally to £5.4 billion (€6.2 billion), from £5.6 billion (€6.5 billion) in the year-ago period, due to lower revenue in its food retail business, resulting from the impact of the petrol forecourt sale.
The retail group's EBITDA amounted to £226 million (€260.8 million), an improvement of £27 million (€31.2 million) compared to the first half of 2022.
Co-op narrowed its underlying loss before tax by £59 million (€68.1 million) in the first half to £9 million (€10.4 million).
The retailer saw 55% growth in membership with the addition of almost half a million (430k) new members. In the first half of 2022, 278k new members joined the co-operative.
It invested £20 million in the first-half in lowering priced across key lines in its food stores, and introduction of member exclusive pricing.
In July, Co-op announced an additional investment of £70 million (€80.8 million) towards these measures.
The company invested £34 million (€39.2 million) in salary increases and another £5 million (€5.8 million) in extending its 30% colleague discount on Co-op branded products in food retail stores to the end of this year.
Shirine Khoury-Haq, chief executive of the Co-op said, "The business momentum established in the second half of the last financial year has carried through into the first six months of 2023 and has allowed us to significantly strengthen our membership offer and proposition – we have put our member-owners at the heart of what we do. We have listened to what they need, and we have not hesitated in our response."
Food Retail, Wholesale Segment
Revenue in the company's food retail business declined slightly to £3.6 billion from £3.9 billion in the first half of last year, driven by the impact of the sale of its petrol forecourt business.
Sales increased 4% year on year on a like-for-like basis in its convenience stores, excluding the revenue from these stores generated in the first half of 2022.
Sales in its quick commerce channel amounted to £133 million in the first half. In this period, the company expanded its partnership with Just Eat to 1,000 stores, as well as a further 300 stores on other partner delivery sites.
The wholesale division reported revenue growth of £40 million, including franchise unit, to £719 million, from £679 million in the first half of 2022.
The unit focused on investments in lowering wholesale pricing, strengthening proposition and choice across Co-op own-brand products, and added 130 new stores.