Co-op‘s half year results have revealed a 50 per cent drop in pre-tax profits to £17 million.
Pre-tax profits dropped by 53 per cent in the six months to July 2 compared to the same period in 2015.
Despite this drastic drop in profits Co-op said it was on track with its three-year turnaround plan.
Profits are thought to have suffered due to investments, pay rises for its front-line staff, pressure to keep up with the increasing price wars and a rebrand.
Following its near-collapse in 2013 in which it racked up a £1.5 billion deficit in its banking sector, the Co-op have written down the value of its investment in its banking arm by £45 million.
The grocer‘s overall revenue was more positive with a 2.2 per cent increase to £4.7 billion in the 26 weeks to July 2. Like for like food sales were also up by 3.1 per cent and its convenience store sales were up by 4.3 per cent.
This week Co-op announced it would be rolling out its new loyalty scheme which will see five million customers receive membership cards, allowing them five per cent off all own-brand purchases.
“We are only halfway through the rebuild and much remains to be done, whether it is investing in our digital capability or campaigning on key issues,” chief executive Richard Pennycook said.
“We remain firmly on track with our plans and are encouraged that the work we are doing is attracting more and more people back to the Co-op.”