The Co-operative Group has underlined its readiness to join a supermarket 'big five' as its food division pushed the group to record profits and sales for the first half of the year.
Following the merger with United in July 2007, the Co-op today announced sales up 34% compared to the equivalent period last year to a new high of £4.02bn, up from a previous mark of £2.99bn.
Operating profits also rose dramatically, up by 35.6% to just over £191m in the six months to 26 July.
The highlight was the performance of its food business, which rose by a massive 43.5% thanks to major expansion by the group, with like-for-like sales showing a 5% improvement compared to 2007.
Chief executive Peter Marks said the results heralded "a renaissance of the whole co-operative sector in the UK".
"This has been an exciting half year for the Co-operative Group as our rejuvenated food business led a strong performance by the trading group," Marks said. "In the wake of the merger of the Co-operative Group and United Co-operatives, we have made record profits. At the same time, we have secured agreement to buy Somerfield – a transformational deal which will cement our position as the UK's premier community retailer. These results show that we are continuing to make huge strides [despite] all the changes going on in the business."
He added: "Looking ahead, it is clear that the rest of this year and quite possibly much of next year will be tough, because of the wider economic environment. The credit crunch, the ongoing slow-down in the housing market, food price inflation and energy cost rises will weigh on all businesses – and our sector will continue to be as competitive as ever.
"In spite of this, we are confident that our business model is robust and we will continue to maximise opportunities as and where they present themselves, while at the same time keeping a firm hand on cost control and delivering a competitive offer to our customers."