Co-op says coronavirus hit to cost £200m, but food sales soar
The Co-op has said it expects the impact of coronavirus to cost it more than £200 million.
However, the retailer said this will be partly offset by higher food sales as shoppers have stocked up in the face of the pandemic, while it has also benefited from the Chancellor’s business rates holiday.
The retail group said the outlook remains “uncertain” due to the virus but it is “clear on strategy to deliver sustainable growth”.
Steve Murrells, chief executive of the Co-op, said: “No part of our business has been unaffected by the outbreak of the virus and we have played a critical role in communities throughout the UK.
“Our food business has helped to feed the nation and our funeral colleagues have been there for families at their time of greatest need.”
The update came as the company “made further financial progress” in 2019 after pushing sales higher.
“While we didn’t know it at the time, that performance set us up well to withstand the impact of the Covid-19 crisis and to enable us to support the communities we operate in,” Mr Murrells said.
It revealed that total revenues jumped 7% to £10.9 billion in the year to December, driven by food sales and the Nisa business it acquired in 2018.
Revenue in its food division rose 3% to £7.5 billion, with like-for-like sales up 1.9%.
The company’s funeral care and life-planning businesses saw revenues slip 3.2% as it was impacted by a falling UK death rate.
Group underlying profits before tax increased by around 50% to £50 million as profitability improved in the food arm.
During the year, the Co-op opened 79 new food stores and refitted a further 152 sites.