The Co-op has revealed it will repay £15.5m of the Covid relief it received from the government’s furlough scheme but will retain what it received in business rates support.
The news comes after it reported a bumper rise in profits after tax and discontinued items for the year to £77m.
For the 52-week period ending 2 January 2021, it also revealed that revenue increased to £11.5bn – up from £10.9bn in 2019 – following food growth of 3.5% and funeralcare revenue flat year-on-year.
The group also said that it faced additional Covid costs during the year of £84m, attributed to the costs of additional new colleagues, increased colleague absence linked to the virus, a colleague “Thank You” reward and the purchasing of personal protective equipment.
Steve Murrells, chief executive of the Co-op, said: “In 2020 we lived through a perfect storm, with every part of our lives turned upside down – socially and economically, mentally and physically. Along the way we discovered much about our society, some of it brilliant and inspiring, and some of it quite ugly thanks to the unfairness and inequality Covid-19 has
revealed and exacerbated.
“During the last few years, we’ve created a business that is truly focused on delivering clear value and benefits for our members, customers and their communities. All that work proved to be essential in giving us the ability to respond to the immediate and sustained demands which the pandemic brought with it.”
He added: “Our Vision, Co-operating for a Fairer World, was our guiding light throughout, and our response to Covid-19 demonstrated the power of co-operative enterprise and the relevance of co-operative values.”
On deciding to retain the support it received in the form of business rates relief the company said it took into account that it took the government support in “good faith”, not expecting to have to pay the money back and “made forward-looking business decisions” on that basis, including those designed to support all the communities in which it operates during the crisis.
Allan Leighton, Co-op group chair, said: “The Co-op has played a vital and unique role in feeding and caring for the nation through the Covid-19 pandemic and will continue to do so as the vaccine programme is further rolled out.
“We were grateful for the Government support that allowed us to manage our businesses through the pandemic, particularly our Funeralcare business, which has been working with bereaved families in extraordinarily difficult circumstances, helping them mark the passing of loved ones at a time of national grief.”
He concluded: “The pandemic turned our plans upside down and, while our revenues went up marginally, our costs rose dis-proportionately. We welcomed money from the Government on the basis that it was not a loan and we would not need to pay it back – and we took business decisions accordingly. I want to thank all of our Co-op colleagues who have made such a difference, day in, day out, over the past year and acknowledge the debt we all owe to them.”