Co-op’s food business saw full year profits surge as it surpassed its membership growth expectations with 5m active member-owners.
Underlying operating profit in the food arm increased 11% to £154m, which the grocer said came as a result of enhancements to cost efficiencies, including improvements in availability, waste reduction, optimised stock-holding and an overall reduction in its cost-to-serve.
Food revenue was marginally down at £7.3bn, which Co-op said was driven primarily by the sale of its petrol forecourt business.
While online sales grew to £311m as the retailer secured the top position in the quick convenience market in the second half of the year.
Having expanded its partnership with Just Eat to just over 1,000 stores in 2023, Co-op now aims to capture 30% of the overall quick convenience market share in the next four years.
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The group also invested £70m in lowering prices across 770 product lines and introduced almost 200 member prices in the year, with sales penetration from members in its food stores reaching a “historic high” of 37%.
Co-op chief executive Shirine Khoury-Haq said that new sign ups last year were “higher than the previous two combined,” as the retailer now plans to increase the figure to 8m members by 2030.
Despite the positive momentum in the food business, group profit before tax fell £240m to £28m amid what Khoury-Haq described as a “highly turbulent external landscape” amid rising inflation and record high levels of shoplifting.
However, she said: “Our relentless focus on strengthening our financial position has enabled us to navigate a highly turbulent external landscape, delivering increased value for our member-owners and planning for a future with confidence and with membership firmly back at the heart of our business.
“Whilst markets remain challenging, we are in firmly in control of our Co-op and our destiny.
“2024 marks a significant shift as we begin putting in place the building blocks for our strategic growth plans across our Co-op, with a focus on growing our existing businesses including increasing our share of the quick commerce market.”
