UNITED CO-OPERATIVES has reported its first financial results since its formation last September after the merger of the former United Norwest and Yorkshire societies.
The results for the financial year to 25th January 2003, show sales, profits and number of trading outlets sharply up on the previous year and continue the success of both partners prior to the merger.
Chief Executive Peter Marks (right) indicated that the new society had also made a good start to its first full year of trading since the end of January 2003 but that a major effort would be required by all concerned due to the tough trading conditions in all the society's main markets.
Outlining the results, Mr Marks said: "In the year ended January 2003, turnover grew by almost 30 per cent to £ 1,324m, reflecting a full year of United Norwest figures and the contribution of Yorkshire Co-operatives from the date of the merger. Even excluding the impact of the merger, turnover would have increased by a very creditable 10.8 per cent."
The society's President, Peter Senior, paid tribute to members and staff who had been working hard on bringing the two organisations together.
Normal operating profit, before exceptional items, also rose sharply, up 44 per cent to £ 33m and profit before distributions (even allowing for one-off exceptional costs of £ 16.9m) similarly advanced strongly, up 16 per cent to £ 18.9m.
The exceptional costs relate mainly to the reductions in goodwill associated with the Office of Fair Trading recommendations on deregulating the supply of prescription medicines, additional costs associated with the merger and the impact on the society's investments of the sizeable drop in the stock market. Though considerable uncertainty exists with respect to the final adoption of the OFT's recommendations and its eventual impact on the health care industry, the society nevertheless thought it right and proper to adopt a prudent assessment of the potential effect on its business.
Mr Marks went on: "This is the ninth year in a row that the society has been able to report improved results and I am confident that we will make it a perfect ten next year. The new society has strong foundations and a clear trading strategy based on our core retail businesses of food, travel, motors, pharmacies, department stores and funerals. We will start to see the full benefit of the merger appearing this year, to be followed by further progress in future years.
"Over the past few years," he said, "both parties to the merger have grasped many opportunities to develop their core businesses, both by acquisition and by organic growth. Both also had strong traditions of innovation aimed at meeting the needs of customers and members.
"These traditions are already serving the new society well and I have been delighted at how quickly we have been able to start moving forward as one business."