Co-op earnings plummet on bank losses

Co-op earnings plummet on bank losses

The Co-operative Group today (15 April) reported "heavy losses" after a "disastrous" year in 2013 but insisted a strategic shift at its food retail arm had resulted in an improving performance.

The UK funerals-to-retail cooperative said it made an operating loss of GBP148m (US$249.1m) in the 12 months to 4 January, down from earnings of GBP142m in the prior year. Net losses totalled GBP2.5bn, including losses from discontinued operations of GBP2.1bn associated with the collapse of its banking arm. Profits were also hit by goodwill charges of GBP226m associated with the group's takeover of Somerfield stores.

The company also witnessed top-line pressure over the last 12 months. Total group sales fell to GBP10.5bn in the period, compared to GBP11bn in 2012.

At its food retail division, sales fell to GBP7.24bn, down from GBP7.44bn. Operating profit excluding one-off charges fell from GBP269m to GBP247m and including one-time charges totalled GBP35m.

However, the Co-op was quick to highlight its like-for-like food performance improved as the year progressed. Food saw like-for-like sales fall by 0.2%, while comparable sales in the core convenience chain rose by 1.6%. The group's performance also improved in the second half, as changes from investments in price and ranging fed through. Second half like-for-like sales rose 0.6%, with a 5.3% increase in convenience.

Click here for coverage of the Co-op's media call to discuss the results - and its plans for its food estate.

Click here to view the full release from the company.