The Co-operative Group reported an increase in revenue but decline in profits for the 26 weeks to 2 July this morning.
Revenue was up 2.2 per cent on a like-for-like basis to £4.7bn from £4.6bn in the same period of last year.
Operating profit dropped to £72m from £95m, while pre-tax profit was down to £17m from £36m.
Food sales rose by 3.1 per cent, and the company said its core convenience business grew "ahead of market" after investment in price and products, with sales up 4.3 per cent.
As expected, the group took a hit on the value of its 20 per cent stake in Co-op Bank. The group reported a loss of £45m on its investment in the Co-operative Bank which it now values at £140m, down from £185m - "consistent with falls in bank valuations generally".
However, the company said it was also worth noting that it made a net profit of £21m on asset disposals - principally the sale of crematoria in its funerals division, and non-core trading properties in food.
Why it's interesting
The company is still plugging away with its "Rebuild" plan - trying to turn the business around after a fall from grace which saw a £1.5bn black hole uncovered in its banking arm's finances, as well as a reputational nightmare surrounding the scandalous private life of former chairman Paul Flowers.
The Co-op previously warned that it would take some time for profits to recover due to the huge investment being made into the restructuring project, which includes a recent rebrand, but the group's management said today's results painted a positive picture of how the plan is progressing.
What the Co-op said
“These are exciting times for the Co-op as we continue to make this a better business that is more relevant for members, customers, communities and colleagues," said chief executive Richard Pennycook.
"Revenues across the group have grown and, in line with our strategy, profitability has fallen due to our major 'Rebuild' investment, pay increases for our people and price cuts for our customers. We are able to invest for the long-term, strengthening the appeal of our products and services, because our business model allows us to pursue our unique approach, championing a better way of doing business for customers and communities."
"We are only half way through the 'Rebuild' and much remains to be done, whether it is investing in our digital capability or campaigning on key issues."
We remain firmly on track with our plans and are encouraged that the work we are doing is attracting more and more people back to the Co-op.