(Reuters) -Co-op, which runs Britain's seventh-biggest supermarket chain, posted a steep drop in annual pretax profit on Thursday following the sale of its petrol forecourt business, and amid growing competition among retailers.
The 180-year-old group, which is owned by its more than 5 million members, has been grappling with intense competition from discounters Aldi and Lidl and market leaders Tesco (LON:TSCO) and Sainsbury's, along with a surge in shoplifting, which has pushed up costs.
It ended 2023 with a grocery market share of 5.4%, according to researcher Kantar, down 20 basis points on the year.
Co-op also committed to investing millions of pounds to prevent price rises at the cost of profitability.
The company, which also has funerals, insurance and legal businesses, reported profit before tax of 28 million pounds ($35.4 million) for 2023, compared with 268 million pounds in the preceding year.
Co-op sold its petrol forecourt estate to supermarket rival Asda for more than 600 million pounds in 2022. Excluding the business, profit was up 79 million pounds for the year, it said.
Group revenue dropped by 200 million pounds to 11.3 billion pounds.
"Over the last two years, our net debt has reduced by 90% from over 900 million pounds, to 82 million pounds today. Whilst markets remain challenging, we are firmly in control of our Co-op and our destiny," CEO Shirine Khoury-Haq said in a statement.
($1 = 0.7903 pounds)