The Co-operative Group has reported that its growth in the first half of the year has been driven by its food business.
The retailer has revealed that group sales are up 34 per cent to £4.02 billion and operating profits are up 35.6 per cent to £191.1 million.
The food business saw sales rise 43.5 per cent to £2.4bn, driven by store refits and range expansions. Like-for-like sales in the first half of the year rose by five per cent, against a total market increase of 4.6 per cent. Trading profit was up 67.7 per cent at £126m.
The Co-operative is set to progress its three-year plan to invest to improve the group and transform its retail estate under a single unified brand. So far, 926 retail outletshave been converted to the new brand concept as part of a £100m investment in the first half. This means the retailer is on track to hit target to double profits in three years.
The Co-operative’s chief executive Peter Marks said: “This has been an exciting half year for the Co-operative Group as our rejuvenated food business led a strong performance by the trading group.
“In the wake of the merger of The Co-operative Group and United Co-operatives, we have made record profits. At the same time, we have secured agreement to buy Somerfield - a transformational deal that will cement out position as the UK’s premier community retailer.
“These results show that we are continuing to make huge strides within the trading group, in spite of all the changes going on in the business.
“I am delighted that we are continuing the process of reinvigorating our business, which will lead to a renaissance of the whole co-operative sector in the UK.
“Looking ahead, it is clear that the rest of this year and quite possibly much of next year will be tough, because of the wider economic environment. The credit crunch, the ongoing slowdown in the housing market, food price inflation and energy cost rises will weigh on all businesses - and our sector will continue to be as competitive as ever.
“In spite of this, we are confident that our business model is robust and we will continue to maximise opportunities as and where they present themselves, while at the same time keeping a firm hand on cost control and delivering a competitiveoffer to our customers.”
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