Co-op Group is confident sales and profits will be up year on year in H2 following summer momentum and its landmark merger with Southern Co-op.
It comes as the society released its half-year results today (23 September), which showed underlying losses grew to £45m in the six months to 4 July 2026, up from £32m in H1 2025, while revenues climbed 2.4% to £5.6bn.
Co-op said it had made strategic investments to drive trade and future growth across its food stores, which had impacted short-term profitability, including in deals, discounts and 135 essentials price-matched to Aldi for members.
Food retail sales are back in growth as a result, up 2.6% to £3.7bn, as transactions returned to levels seen before the 2025 cyberattack.
“We’re very clearly on a journey,” said interim CEO Kate Allum. “2025 was a challenging year for us, and 2026 continues with challenging market conditions, particularly in food retail.
“We’ve made some intentional decisions to invest to drive trade and feel positive about the fact that we’ve seen momentum growth through the summer, which has resulted in stronger sales, bigger baskets and more transactions, and an increase in membership.”
Across the rest of the portfolio, wholesale and franchise fell flat at £683m, while sales to other co-operatives increased by 1.9% to £1bn. Its life services arm increased by 8.1% to £227m.
“It’s also important our portfolio and life services business are very much part of the strength and depth of the group and we have a really strong performance across life services which is very important to us,” added Allum.
“We’ve been around for 180 years, and we intend to be around for another 180 years. We’re confident that second half will be an improvement on both sales and profitability year on year.”
Allum added that the transfer of engagements of Southern Co-op in July, which continues to operate independently pending CMA approval, will be a “key cornerstone” in terms of growth in the second half of the year, as it seeks to build on its momentum and add “another level of strength and depth to The Co-op Group”.
The Co-op Group and Southern Co-op were given a deadline of yesterday (22 September) to persuade the CMA not to launch a full-scale phase 2 inquiry into their proposed merger.
The UK’s competition watchdog published the findings of its initial phase 1 inquiry into the merger of the two Co-op societies last week, confirming it had identified that the plans could result in a substantial lessening of competition (SLC) in the retail supply of groceries in convenience stories in local areas, centring around nine stores currently owned by the Co-op Group and 10 Southern Co-op-owned stores.
Allum could not confirm what Co-op Group had proposed, but was “very confident with the outcome being in the right direction for us”.
“We’re still in the CMA process and everything is going according to plan,” she added. “There’s nothing that’s come out of the CMA that’s a surprise to us. We’re continuing with our plans so that we execute it cleanly and make sure we deliver that strength and depth for the group.”
Allum also confirmed the search for a permanent CEO was still underway, but “was not putting a time frame to it”.
“We’ve been very clear that the most important thing is getting the right person for our Co-op, which means the right commercial person but also the person with the right integrity, values and understanding of our co-op values and ethical decision making,” she said.
The search comes amid a number of other senior leadership roles have exited the business, including Co-op group MD Matt Hood, along with commercial director for fresh and chilled Nicole Tallant and Tom Bradley, commercial director for strategy and supplier relationships.
The departures came as Co-op confirmed a change to its controversial new group commercial and logistics division under former food MD Hood.
Current chief procurement officer Imran Rasul has since taken on the newly created role of chief commercial officer. Rather than having a group commercial and logistics function under one leader, previously Hood, teams are now organised into separate commercial and logistics functions, with Rasul leading commercial and supply chain and logistics director Andy Wilmot leading logistics.
“Lots of people want to talk about that people who have left, I want to talk about the people who are still here because I have absolute confidence in our leadership team,” said Allum.
“Having stepped into the interim CEO role and working directly with the leadership team, I have no concerns about our Co-op is not just in safe hands, but in really great hands.
“We would’ve not been able to deliver the momentum that we’ve seen within the business if we didn’t have that strength and depth in leadership and colleague commitment.”
No comments yet