Mutual giant, the Co-operative Group, says like-for-like (LFL) food sales are recovering as it mulls a possible offer for a network of Lloyds bank branches.
The company's food division, operating in an "increasingly tough" market, produced an underlying operating profit of £309m in 2011 versus £389m in 2010.
LFL sales steadily improved during the year, from -3.6% at the half year to -0.4% in the second half, making the full year -2.1% and Thursday's update says the trend has continued to improve in 2012.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The banking division turned in an underlying operating profit of £201m (2010: £202m); with a core tier one ratio of 9.6% and an improved loan to deposit ratio of 94%.
The group's other specialist businesses contributed operating profit of £99m (2010: £90m).
Although the Co-op has been named the preferred bidder for a network of 632 Lloyds branches the Co-op's Chief Executive, Peter Marks, said: "This is a complex deal and there is no certainty we will reach a final deal."
The Co-op also says it will begin to offer legal services through its current bank branches.
Overall operating profit rose 0.5% on 2010 to hit £585m while profit before tax dropped 5.8% to £373m.
The dividend has been decreased to 1.75p per point from 2p in 2010.
BS
-
What will 2024 general election mean for UK house prices?UK house prices have been seeing a spring bounce. But has Rishi Sunak’s snap election changed the property market’s outlook?
-
What will the general election mean for your taxes?Taxes are in focus as we race towards the 4 July general election. What can you expect from the two main parties?
