Co-op News October 2019: Sustainable Development

p The Group’s headquarters at Angel Square, Manchester
CO-OP GROUP
Half-year results hit by drop in funeral business
The Co-op Group announced its half-year
results last month, with pre-tax profit
down to £25m in the 26 weeks to 6 July –
from £44m in the same period last year.
The retailer says the drop in profit was
the result of an unexpected 10% fall in
the death rate, which affected its funeral
business. The division saw a 6% drop in
revenue, with fewer funerals adding to its
decision not to increase prices.
Food sales rose 3% to £3.7bn with the
retailer recording 22 straight quarters of
like-for-like sales growth. Strong food
sales and the retailer’s acquisition of
Nisa led to a 12% rise in Group revenue
to £5.4bn. Net debt also increased from
£714m in January to £784m.
During the six months, the Group
returned £29m to members and £6m to
4,000 local causes.
Co-op Health is expected to be rolled
out nationally by early 2020, in an effort
to bring convenience to pharmacy and
health services.
The Group said its forecasts had taken
into account the potential impact of Brexit
on the business. It warned about increased
risk of some disruption to its supply chain
and said it would be stockpiling items
including water and toilet paper ahead
of Brexit.
Chief executive Steve Murrells said:
“We’ve enjoyed another good six months
where the strength of our business
has led to a further £35m of value
being generated for our members and
their communities.
“Our food business continues to
perform strongly in a highly competitive
market and has now recorded 22
consecutive quarters of like-for-like
sales growth. As our largest business,
it is providing the fuel for our growth
in terms of member value and
community impact.
“In funerals we are actively repositioning
the business to meet the
changing needs of our members. We are
the market leader but we will also lead
the market in providing better choices
and options for our customers in the years
ahead. Likewise, the development in our
insurance, legal and health businesses
will enable us to significantly broaden
the range of services, in areas where our
members know the co-op difference can
be clearly seen.”
Chair Allan Leighton said: “We have
made further progress during the first
six months of this year and the strength
of our business can be seen by our
underlying financial position and through
the increasing impact we’re having in
local communities.
“The Co-op is now 175 years young,
and we have worked hard to ensure
that we remain relevant to all generations
and in particular younger co-operators
– whether this is using our presence
at eight music festivals to introduce
people to our values and ways of doing
things, or by developing motor insurance
products specifically with the needs of
young drivers in mind.”
He added: “The Co-op Group is thriving
and we are committed to growing our
co-op difference and impact for
generations to come.”
u Group signs UN climate pledge: p9
u More retail results: p7-8
6 | OCTOBER 2019