Christmas sales give Co-operative Group a festive boost

 

The embattled Co-operative Group posted a rise in festive sales across its supermarket arm thanks to a robust performance from its smaller convenience stores.

The Co-op sought to put the woes at its banking business behind it as it hailed "strong" trading in the 2,800-strong food chain, with like-for-like sales up 1% in the 13 weeks to January 4.

A 3.2% hike from its 2,000 smaller convenience stores drove the rise as shoppers sought to buy more frequently and locally over the Christmas season.

The Co-op suffered a dire year following a capital crisis at its banking arm and scandal surrounding former bank chairman Paul Flowers after he was arrested as part of a drugs investigation.

Its banking business has now fallen under the control of bondholders, including US hedge funds, as part of a refinancing to fill a £1.5 billion hole in its balance sheet.

It now faces a raft of inquiries into what went wrong at the bank, with regulators announcing earlier this week the latest in a line of probes as they launched formal investigations that could see former senior managers fined or banned from working in the industry.

Euan Sutherland, chief executive at the Co-op Group, said: "The recapitalisation of the bank at the end of last year represented an important milestone and now we can see that the foundations of the wider group, through its trading businesses, remain strong."

Sales growth picked up pace in the final three weeks to January 4, up 3.5% across the entire estate and 5.4% in the convenience stores.

Spokesman Russ Brady said: "People are becoming more savvy in terms of buying when they need.

"They're not just coming in for a pint of milk, but also shopping for the next 24 to 48 hours."

Sales were particularly strong for chilled party food and drink, with sales of sparking wines and prosecco up more than 800%.

It also saw a hike in online electrical sales, up 28.2% in the 13 weeks, while pharmacy sales rose 1%.

Co-op Food is the fifth largest grocery retailer in the UK, but has the largest number of convenience stores.

It is focusing on expanding the convenience stores business, while selling off its less profitable larger stores.

PA

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