UK co-operative societies have largely reported a rise in turnover for the 2016-17 year, but the sector has seen a general fall in retained profit.
In their annual results, several societies said the year had been a challenging one, citing factors such as uncertainty over Brexit and the weakened pound, and competition on the high street.
Four societies reported an increase in retained profits, including Lincolnshire (which reported its full-year results last September), after notching up record sales of £301m, and Chelmsford Star, which lifted profit by 16.7%.
Scotmid hailed a strong underlying performance with an operating profit up nearly by £2m but warned of uncertainty over wage increases, tough high street competition and Brexit, and Tamworth, which recorded its best results in 25 years with profits up 31.8%.
At Southern, Channel Islands, East of England, Heart of England, Midcounties and Radstock, retained profits were down on the previous year.
East of England saw retained profit for the financial year down 54% to £1.9m (2016: £4.2m), citing write-offs and the previous year’s figure being lifted by disposal of assets. Trading profits were up and the society paid out a £3m divi.
At Heart of England, retained profit fell from £3.1m to £1.3m, with operating profit also down, as the society pointed to competition from discounters, low consumer confidence, and uncertainties led by a weakening pound.
Channel Islands announced increased turnover and a 4% divi but retained profit was down to £0.5m from £2.6m. The society said this was because of revaluations and property sales the previous year.
At Southern, retained profits fell to £2m (2016: £4.3m) but turnover and operating profit rose and the society hailed a “milestone year”, while at Midcounties retained profits fell to £0.7m (2016: £4.8m). Operating profit was also down despite higher turnover, with chief executive Ben Reid warning of a challenging year ahead for UK business.
Radstock also saw retained profit down to £147,722 (2016: £213,729); operating profits also fell while turnover rose, and the society said it was committed to a growth strategy in “uncertain times”.
Two made a retained loss. Central England lost £3.9m (2016: £3.1m profit), but said it remained resilient and was carrying out an investment programme in tough market conditions.
The Co-op Group lost £134m (2016: £15m profit) despite increased retail sales after writing down the value of its stake in the Co-op Bank to nil.
It reported an operating profit of £148m (2015: £112m), driven by £20m profit on disposals, largely reflecting the sale of its crematoria, and lower restructuring costs.
An underlying profit before tax of £59m (2015: £81m) was down, due to increased rebuild investment, according to the Group, which said it was making “great progress” in its rebuilding process.
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Turnover
Operating profit (/Trading profit (TP))
