The society also reported a 5.7 per cent rise in food sales on a like for like basis; an increase in turnover on continuing operations of 3.2 per cent and a members’ dividend payout of £4.2m based on 2.5p in the pound on qualifying purchases.
The rise in food sales has continued into the new trading year with a five per cent sales increase for the first quarter of 2009.
The society spent a record £27.7m on its ongoing capital development programme, which is entirely self-funded and is therefore able to continue modernisation programmes without the need for borrowing.
Chief Executive Richard Samson commented: “2008 was an exceptionally difficult year, which took its toll on many of our competitors and trading has been challenging in several of our own businesses. Despite this, we have been able to show an overall increase in underlying trading profit of more than £1m to £11.4m — over ten per cent higher than in the previous year.
“The roll-out of the East of England brand identity to food stores and supermarkets, plus store refurbishments and competitive pricing, have met with considerable success. Our refurbished stores have recorded significantly increased sales and our customers clearly value the service and convenience these local stores offer.”
Mr Samson thanked staff and members for their efforts and said he was delighted that £813,000 would be distributed to over 3,000 qualifying staff through the society’s Employee Dividend Scheme.
The annual report says a new EPOS (Electronic Point of Sale) system for Food Retail was fully installed across the society’s portfolio of food stores and will be introduced into Pharmacy and Optical branches during 2009.
The report also highlights the success of the local sourcing initiative and points out that over half of the society’s 135 food stores now offer a range of locally sourced products from 35 suppliers.
Major acquisitions made through the society’s Property Division in 2008 included the Triangle shopping centre and Wherstead Park, a modern office complex near Ipswich.
Both purchases will benefit the society from rental income and Wherstead Park is of strategic importance as it will serve three purposes:
1) East of England Co-op now has a well-equipped, superbly located, modern base for its Head Office requirements enabling the majority of its administrative functions to come together on one site for the first time.
2) The offices within this 17-acre site will provide rental income from other occupiers, including first tenant, P&O Ferrymasters.
3) ‘The Mansion’, a Grade II listed Georgian manor house on the site, will provide a new business venture and will operate as an events and conference centre, as well as a regional training academy, which will be launched later this year.
East of England say there were other smaller acquisitions last year coupled with the consolidation and rationalisation of various areas of the business. A new online electrical business began operating late last year and is recording steady sales.
During 2009, the Framlingham Supermarket in Suffolk was relaunched following a £1.3m refurbishment and a similar £1.5m project is underway at Leiston. New build stores are planned at Coggeshall, Wickham Market and Colchester and a new convenience food store, with flats above, in Hatfield Peverel is expected to be completed by Christmas.