Co-op has reported pre-tax profits of £57 million for last year in comparison to £127 million in in 2020.

This means the retailer's overall profits were down by £70 million in 2021.

The company also recorded £920 million net debt, which it said reflected a number of factors, including increased capital expenditure, investment in stock during supply chain disruption, negative cash flow timings, and furlough repayment.

It did say that net debt has "improved significantly" since the end of last year.

“The last year has seen us facing some significant challenges, including significant supply chain issues in the second half coming at the same time as our Food business transformation and increasing inflationary pressures,” said Shirine Khoury-Haq, chief executive, Co-op. “The difficult operating environment disproportionately impacted our Food business, given its focus on the community convenience market, with an operating model that is more reliant on flexibility in the supply chain.”

The company expects to continue facing headwinds over the next 12 months, citing final implementation of the business transformation in food, current inflationary pressures, and the economic uncertainty facing customers, members and colleagues as possible challenges.

“The past year has been a challenging one for our Co-op, but we continued as planned with our investment strategy to strengthen our Co-op’s future state,” said Allan Leighton, chair, Co-op. “The economic headwinds look stark and will be tricky to navigate but through our continued planned strategic investments our Co-op is well placed to ride out the storm and prosper beyond.”

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