Heart of England Co-op has issued its annual results for the year to 24 January, with a growth in sales, and a pre-tax loss of £59,000 – a sharp improvement on the previous year’s loss of £3.2m.
Turnover rose to £97m from £95m, and the operating loss fell to a near break-even £7,000, down from £3.2m. This was against the backdrop of a difficult trading year marked by the impact of the supply disruptions caused by the cyber attack on the Co-op Group.
Setting out the society’s performance in the report, CEO Steve Browne wrote: “Net sales exceeded 2025 by £2.2m, driven by the opening of the food store and the coffee drive-thru at Glenvale park in November 2024.
“Gross profit margin was behind budget, attached to the cyber impact and sales.
“Adjusted earnings before interest, tax, depreciation, amortisation and exceptional items (Adjusted EBITDA) of £2.6m (2025: £3.4m) fell short of budget again largely associated with the cyber-attack the impact across net sales and higher costs.”
But Browne noted that the society is to file an insurance claim on the cyber attack, adding that the pre-tax loss “was significantly lower than the prior year by £3.2m despite a very challenging operating environment”.
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He added that tight control of expenditure had delivered a closing cash balance of £3.7m, a £2.8m improvement over the previous year.
“The cyber-attack affected us seriously and as we come to the end of the year, we recognise that the impact has continued. Whilst the immediate impact on our food supply chain was evident, we have to acknowledge that member confidence took a hit. This has meant that fewer members shopped with us and those that remained shopped less.”
This disrupted the momentum of a strong start to 2025, said Browne, and “the level of disruption significantly halted our strategic course of direction as we had to utilise all of our available human resources to mitigate the significance of the attack.”
But the society continued in its efforts to drive strategic progress, said Browne, with the purchase of land in Southam Flying Fields and the construction of a new store.
This £2.4m store, on a former WWII airfield, opened this month, with green features including solar PV and built-in bird and bat boxes.
Pupils from St Mary’s Catholic Primary School took part in the opening ceremony, and the school was given a goodwill cheque for £500, with a further £200 donation going to Southam Foodbank.
“This is a flagship branch as it’s the first store we’ve opened in our new visual identity and marks the start of an exciting new brand rollout for us,” said Browne. “The store is located in the heart of an amazing new community. A great deal of thought has gone into its offering to our customers and members.
“We have created 14 new jobs, and we specifically targeted people living in this locality.”
This follows work commissioned by the society on its brand “with our desire to modernise and create total clarity around our society’s point of difference in 2026”.
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Browne added that Heart of England saw strong growth across Food to Go, and invested towards the tailvend of the year in three trial stores, rolling out an enhanced deli proposition “with a view to extending this as a key strategic play in the future”.
And the society has started working with Cybake to support growth across instore bakery and hot food.
Quick commerce has been rolled out acrossva single platform created with Snappy Shopper and Southern Co-op, rolling out to Just Eat and with the aim of expanding through Uber Eats.
The society completed the deployment of Symphony AI in April 2026, added Browne, “which is our new sophisticated range and space software that will take us on a journey across multiple years to building ranges at micro-local level to support range development and ensure we are as efficient as possible.”
Work continues on the society’s coffee franchise partnership with Bewiched, the report added, with the closure of a site at Leamington retail in early 2026, following heavy disruption from roadworks.
However, the partnership’s third branch opened at the society’s Attleborough store in April 2026, and the sites at Balsall Common and Glenvale “are progressing very well, generating strong levels of cash and operating profitably,” said Browne. “We have strong ambitions in the area of coffee with a clear pipeline of activity for 2026 and beyond.”
The funeral operation traded will and on budget, said Browne, but the society “took the strategic decision to sell off two under-performing branches (Gillivers and Towcester) which will conclude in 2026, leaving us with 14 funeral homes”.
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Heart of England relaunched its funeral plan options in September, and saw 280 plans taken between the launch date and year end, an increase of 56%.
In terms of non-trading property, the society reviewed its portfolio and sold properties based on low yield and/ or the requirement for future capital investment. These raised funds that were reinvested in Southam.
Over the year, Heart of England supported 186 good causes, raising just shy of £50,000 for Macmillan in the region across a two-year commitment – beating a target of £25,000.
The society also launched a partnership with Pennies (Micro Donations) across its Food stores,
On sustainability, the society secured a deal with Zest Energy with the first four EV charging points rolling out in early 2026.
Heart of England has also applied to become part of the Science Based Targets initiative, “which has now been ratified at the point of writing,” said Browne.
The new Southam store reflects these commitments, the society says.
“The environment is foremost in our thoughts whenever we launch a new building,” said Browne in a release on the store’s opening, “and this is the greenest one we have ever created.
“It uses no natural gas, and the LED lighting has presence detection in the aisles which turns the lights on and off as shoppers enter and leave.
“On bright days the solar panels will be sufficient to run the store entirely off grid. We also engage in rainwater harvesting to keep our plants healthy and look after the local wildlife by having specialist bat and bird boxes built into both sides of the building.”
The store conforms with the BREEAM ‘Good’ Standard criteria, exceeding regulatory levels in areas such as environmental performance, energy and resource efficiency, sustainable construction practices, waste reduction and recycling measures, ecological impact and biodiversity.
“Make no mistake, we have one long term aim in regard to our carbon footprint and that is to continually strive to reach net zero,” added Browne.
As for Heart of England’s overall performance, he concluded in the annual report: “The year was a difficult one, but in spite of this we have made progress. While we incurred a loss for the third year running, we can clearly articulate why and what we are doing about it.
“Pleasingly, we have come into the year with no bank borrowing at all, with strong cash resources and the ability to push on in 2026 to grow with a pipeline of very strong strategic activity.
