The CEO of one of the Channel Islands' largest supermarket chains has reported "very challenging trading conditions", as its annual report showed falling trading profits.
Its 2023 annual report shows trading profit down 3% year on year at £5.8m, following falls of 16.7% and 20% in the previous two years.
It stood at more than £9m in the year to January 2020.
“It is without a doubt that a key theme for the CI Coop over the past 12 months has been resilience,” said Chief Executive Officer Mark Cox.
“Much of our focus has been on managing the challenges presented to us by external factors, including increased costs through inflation, the cost-of-living crisis, and the ongoing war in Ukraine. These factors coupled with local pressures of recruiting and retaining colleagues are creating very challenging trading conditions.”
Supply chain issues have also impacted financial performance and the cost base and cost of products have increased as a result.
“These are challenges that are affecting many business sectors, not just our own, but trials we predict that we can overcome with patience, resilience, and cooperation," continued Mr Cox.
Pictured: “We have invested more resource into our fresh produce category," Mr Cox said.
£5.5m of dividend was paid out to members in 2022 and the same will be paid out in 2023.
There are now 128,269 members, down from 129,249 in January 2022. Turnover was up by £10.8m, or 6%, to £192.4m and food and fuel sales accounted for £178.4m of this.
The food business represents 82% of the sales, and this increased by 1.1% to £157.9m. Meanwhile, fuel sales grew from £13.5m to £20.5m.
Mr Cox said: "It is not to be ignored that inflation in both food and fuel costs, with consequent increases in prices, have contributed to this turnover figure. However, this increase has also been driven by other elements of the organisation including the opening of a new store at Five Oaks in Jersey and an expansion to the range of products offered to our islanders through ranges, such as Carrefour.”
Despite this, Mr Cox said freight challenges continued into 2022.
“Product and driver shortages in the UK impacted our supply chain, particularly during early 2022, which combined with periods of weather disruption, left shelves looking empty at times.”
He warned that with mixing working from home with the office, it was unlikely that the volume of fuel sales will return to pre-pandemic levels.
“We have invested more resource into our fresh produce category and have also developed a good working relationship with a new supplier of fresh fruit and vegetables. Since introducing our Mudwalls range to stores, we are pleased that members and customers have also noticed an improved choice and quality of our fruit and vegetable offering.”
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