The Co-op has revealed widened half year losses following a tumultuous start to the year and tougher trading, but said it was set for a stronger final six months as flagging sales improve.
The mutual reported underlying operating losses of £45 million for the six months to July 4 against losses of £32 million a year ago, when it was hit by a damaging cyber attack that sent it plunging into the red.
The Co-op said its latest half-year figures were impacted by weak consumer confidence and £78 million in extra costs, including increased labour taxes, as sales rose 2.4% across the group, which runs more than 2,300 food stores and 800 funeral homes across the UK.
Sales at its food stores lifted 2.6%, but this is compared with a year earlier when the costly hack in April 2025 knocked first half revenues by £206 million and delivered an £80 million blow to profits.
Alongside recovering from last year’s cyber attack it was also recently forced to defend itself from claims of a “toxic” environment at the business.
A management shake-up has followed, with former chief executive Shirine Khoury-Haq stepping down in March, followed by ex-chairwoman Debbie White in August, while managing director Matt Hood quit earlier in the summer.
The mutual is also pushing ahead with plans to cut £200 million this year in order to offset higher costs and secure its long-term financial stability.
Interim chief executive Kate Allum, who took the reins at the end of March, said: “The first half was characterised by difficult markets and low consumer confidence, especially for food retail.
“Against those conditions, we made decisions to drive trade – investing in promotions and investing in our stores – while also mitigating rising costs.
“These things have had a short-term impact on profitability.
But she said trading was turning around, with shoppers spending more and visiting its food stores more frequently.
Ms Allum added: “Conditions remain challenging, but we see reasons for confidence across our portfolio, having delivered strong growth in areas such as online convenience shopping and funerals.
“We expect to see a stronger performance in the second half than the first, with sales growth and improvements in profitability.”
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