Co-op boosts revenue and profit following Nisa deal
Co-op has increased its revenue and profit strongly in the wake of its acquisition of retail chain Nisa in May.
Looking forward the group warned of potential uncertainty over Brexit and said it was planning for various scenarios as best as it can.
The numbers
Revenue rose 14 per cent to £10.2bn and profit before tax jumped 27 per cent to £93m in the year to 5 January.
Underlying profit before tax remained flat at £43m.
Read more: Dignity shares slide after regulator proposes funeral competition probe
Food revenues grew 4.4 per cent in like-for-like terms, marking the fifth year of like-for-like growth.
Revenue in its funeral business fell year-on-year, with revenue down one per cent and profitability down £17m on the previous year.
The Co-op blamed challenging market conditions, in a sector which is being investigated by the Competition and Markets Authority.
Why it's interesting
The Co-op acquired Nisa for £143m last year, boosting its retail footprint and helping increase revenue.
Read more: The Co-op could offload its insurance arm in a £300m deal
The acquisition of Nisa increased its wholesale reach, meaning more customers could be offered Co-op products.
It also announced plans to sell its insurance underwriting business for £185m to Markerstudy, a deal that is set to complete in the summer, subject to regulatory approval.
The company said it has taken a £230m loss on the sale, which is included in its income statement under loss on discontinued operations and not included in its profit before tax figures.
The loss includes the write-down of the net assets of the insurance business and some costs relating to the sale.
What the company said
Steve Murrells, chief Executive of the Co-op, said: “Over the past year we have continued to successfully transform the Co-op, leading to a 14 per cent increase in revenues to £10.2bn and the return of £60m directly to our members and £19m to over 4,000 community projects across the UK.
“The acquisition and integration of the Nisa wholesale business has been a game changer in expanding our food footprint and we have also set out the path by which we can offer our members a broader range of compelling Co-op solutions in insurance and health.
“We continue to demonstrate that the Co-op is a good business that does good for society as we lead on issues including single use plastics, funeral affordability and social housing. It is this determination to make a positive difference for all of our stakeholders which will ensure that we fulfil our ambition to build a stronger Co-op and stronger communities.”