Co-op saw its annual profits quadruple last year, though it warned of trickier times ahead with £200m of new headwinds and investment costs about to land.
Its pre-tax profits rose from £28m last year to £161m in the year to 4 January, despite group sales remaining flat at £11.3bn.
The profit growth was led by strong improvements in food and life services, offset by a decline in the wholesale business.
Its food sales grew 1.9% to £7.4bn, led by by a 46% boost in online to £460m.
Yet it warned of serious headwinds in the coming year, including geopolitical issues, extended producer responsibility charges, and higher National Insurance contributions.
This included “active choices to support members, colleagues, and communities with cost of living challenges”, the company said.
“Our solid business performance alongside the progress we have made in right-sizing the business and delivering against our new strategy, is enabling us to create more value for our member-owners every day,” said CEO Shirine Khoury-Haq.
“While broader economic challenges remain, our businesses are delivering strongly against the market and I’m proud that we continue to provide support to our colleagues, members, and their communities through the continued cost of living challenges they face.”
Co-op membership grew by 22% last year, meaning it is now owned by 6.2 million members. The average age of members fell by two years, with a 66% increase in those joining under 25.
Co-op members benefit from cheaper prices across food, insurance, and legal. The business spent £92m last year on lowering these costs, £88m of which was on food.
It said it remained on track to open over 120 new stores by the end of 2025.
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