Peter Marks, boss of The Co-operative Group, declared this morning that trading conditions were “the worst” he had seen “in over 40 years of retailing”.

The gloomy observation came as he unveiled the first drop in sales and profits at the society since 2005. If a slip in the like-for-likes was widely expected following the full-year slump last term, the hit to sales and profits was an unpleasant surprise – especially given that operating profits were up 33% for the previous 12 months.

Marks has always been quick to point out that profits remained on an upward trajectory despite the well-documented indigestion that came after swallowing Somerfield – in contrast to high-profile acquisitions such as Morrisons-Safeway. Until now.

But today Marks changed tack, arguing that as the society does not have to fret over share prices and keeping the City sweet, it can play a far longer game than rivals.

This morning’s figures showed the society ploughed a whopping £280m into the business over the past six months – part of a three-year, £2bn investment programme. Two-thirds of that sum went into the food business, refitting 244 stores and opening two new distribution centres, with another brace in the pipeline.

Plans are also in place to cross-promote its portfolio of businesses, starting with the rollout of banking services into food stores, which Marks predicts will “significantly enhance” the company’s bottom line in the future.

“We never get too exercised about short-term losses,” a remarkably upbeat Marks told The Grocer.

“What I’m looking at is the long-term and I have never been so optimistic, ambitious and excited. When the economic upturn finally begins we will be better placed than ever before.”