Streamlined Co-op Group now in shape to build for future

Annual profits and revenues fell at the Co-op Group in 2023, the Manchester-based business revealed today.

But most of the decline was due to the divestment of its petrol forecourts business, it explained.

Revenues for the year were £11.3bn, down from £11.5bn previously. Pre-tax profits of £28m were significantly lower than £268m in 2022.

However, 2022 included sales from the petrol forecourts business, as well as the £319m profit following its sale.

Pre-tax profits were also affected by a restating of the 2022 figures to reflect the new accounting treatment for funeral plans under IFRS17. FY2023 onwards is accounted for on this basis.

The Co-op said that, on an underlying basis, it made an operating profit of £97m, compared with £83m in 2022.

Excluding the impact of the petrol forecourt sale, revenues increased 4.7%, or £500m.

Net cash from operating activities stood at £602m at the end of the 2023 financial year, a £147m improvement on 2022.

And group net debt has been reduced by £240m to £82m by the end of 2023.

More than one million new members joined the group in 2023, increasing its active membership base to in excess of five million member owners, a 14% year on year increase. The business also saw continued growth in younger members, with active member owners under the age of 25 rising 52% to 362,333 in 2023 (2022: 211,176).

Looking forward, the board said it is confident in the Co-op’s strategy as it focuses on prioritising growth in its business and membership, in a way that creates value for our member-owners, while also maintaining strong financial discipline.

The work undertaken over the past two years to significantly strengthen the Co-op’s financial position has enabled it to effectively navigate any ongoing economic volatility. And it said it is now well positioned to pursue its strategic growth initiatives across the business.

To accelerate its growth ambition and simplify how it runs the business, the Co-op is creating three core business areas – Food Retail, Business to Business and Life Services – enabling it to more easily capture growth in its existing markets and fully realise adjacent market opportunities.

The group said it has established clear long term ambitions for 2030 in support of its vision of ‘Co-operating to build more value for our member-owners every day’. This will see Co-op membership increase from five million to eight million by the end of this decade, it says.

Shirine Khoury-Haq

Chief executive, Shirine Khoury-Haq, said: “I’d like to thank all our exceptional colleagues, who have been instrumental in our success over the last year.

“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.

“Over the last two years, our net debt has reduced by 90% from over £900m, to £82m today. Whilst markets remain challenging, we are in firmly in control of our Co-op and our destiny.”

She added: “Our success in attracting new members has seen us surpass our expectations with new sign ups last year higher than the previous two years combined. This momentum has continued into 2024 as we now stand at 5.2 million active member owners, and we expect to continue this journey and substantially increase the number of member-owners to eight million by 2030.

“We look forward with confidence as we focus on growing our business for our member owners, while simultaneously enhancing the value we deliver to them and their communities.

“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 and expanding our presence within the life services sector.”