Growth pays off as Midcounties Co-op improves annual profits

THE Midcounties Co-operative has defied difficult trading conditions to post an annual operating profit of £20.9m, a 15% increase on the previous year’s £18.1m.

The strong results include an above industry average 3.4% increase in ‘like for like’ sales in food retailing – its core business. They also include a 6.7% increase in overall gross sales, bringing sales to £788m.

Ben Reid, chief executive, said the achievement clearly marked the group out from many other food retailers which had been unable to adapt as well to the current trading conditions.

Mr Reid, addressing members at the society’s AGM, at the National Motorcycle Museum, said the society had raised its game by turning the economic challenges to its advantage and significantly investing in all of the businesses it operates.

“We are currently celebrating the International Year of Co-operatives and this strong set of results shows the socially responsible co-operative way of doing business is an enduring and successful one, even in difficult times,” he said.

Co-operative Energy, which has just celebrated its first birthday, had proved that an ethically driven co-operative model could challenge what is, a very competitive sector, he added.

“There is no doubt it has the capacity to be a notable player in the energy market for years to come,” said Mr Reid.

Co-operative Childcare has seen exceptional growth during the year having started 2011/12 with just six nurseries and growing the portfolio to 30. This has grown 46 since the year end.

Mr Reid said this was a clear statement of Midcounties’ commitment to an area where it believed it could add value.

The Co-operative Travel business also had a strong year, with profits doubling. This was despite some of the society’s partner co-operatives deciding to form a joint venture with Thomas Cook.

Patrick Gray, society president, said: “The engagement and support of colleagues is absolutely central to our success.

“While significant expenditure on the launch of new trading activities and deteriorating trading conditions in the second half had some impact on trading profit, operating profit – the main measure of success used in the private sector – has improved.”

Other major highlights included:

•    The purchase, after the year end, of 10 Harry Tuffins food stores with anticipated sales of £60m
•    Co-operative Energy receiving three industry awards
•    Some 32,500 colleague work hours were invested in community projects.