Midlands hit new profit high

Midlands Co-operative has announced another record performance, with comparative trading profits up 16 per cent to £18.9 million for the year ending January 23.

The society’s annual report reveals that sales increased by eight per cent to £918m; more than £40m was spent on capital investments and operating cash flow increased to nearly £34m.

All Midlands’ divisions reported increased sales, despite the economic downturn. 

The report says the society’s decision to adopt The Co-operative brand at the beginning of 2009 has allowed it to tap into the shared brand equity of the Movement more strongly.  

A rebranding programme is underway and the society has converted 33 food stores during the year, as well as starting to incorporate the brand into its travel and funeral businesses. 

Although the net asset value reduced due to the downturn in the investment property market and the liability of the employee’s pension scheme, the society’s positive operational cash flow increased to nearly £34m.  

Like-for-like gross sales in the retail food stores rose by 3.4 per cent. Trading was particularly strong in the run-up to Christmas and the society record its highest ever daily sales figure of £2.86m on December 23.

In the travel division, sales increased to a record £285m and the society’s funeral business achieved a marginal improvement in market share and achieved record sales of £35m.

The property business generated a rental income of nearly £6m, and although the net asset value of the portfolio has been affected by the recent drop in property values, the society says it continues to view property as a long-term investment that underpins its trading businesses.

The society’s stakeholder strategy, which recognises and rewards members, employees and the community, has seen record distributions of £3.1m in the past  year.

Chief Executive Martyn Cheatle commented: “We intend to continue the society’s established business strategy of consistent investment in core businesses, funded by strong operational cash flow, without significant borrowings.  

“I am confident that this approach, along with the continued hard work and commitment of staff, will enable our society to continue to progress.”

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