Source: Sharecast
It said the criminal cyber incident had an estimated £285m direct impact on revenue and £107m hit to profitability, as it restricted its own systems to contain the threat.
Total revenue fell 2.3% year-on-year to £11.03bn, while the group posted an underlying operating loss of £35m compared with a £131m profit in 2024.
Underlying loss before tax widened to £126m from a £45m profit, and net debt excluding leases increased to £317m from £55m.
Excluding the cyber impact, revenue was broadly flat, with growth in Food Retail and Life Services offset by a decline in Wholesale as the group reset its proposition.
The operating loss included an £86m margin impact from the cyber attack alongside around £150m of cost headwinds, including £47m linked to regulatory changes such as higher National Insurance contributions and new Extended Producer Responsibility charges, as well as increased colleague pay.
Co-op said its balance sheet and liquidity enabled it to withstand the disruption and continue investing, with £318m of capital expenditure during the year focused on stores, technology and customer experience.
Active membership rose 17% to 7.2 million, prompting a new target of 10 million members by 2030.
“2025 was a challenging year, but those challenges have helped us reshape Co-op for the future,” said chair Debbie White.
“Despite a cyber attack and tough market conditions, our colleagues have shown incredible resilience, keeping communities served and essential services running.
“To get back on track, we have adjusted our commercial strategy and strengthened our partner offer while substantially growing active membership.
“Now, we're looking ahead with a strong focus on customers, while continuing to prioritise the people who own our business, targeting ten million active members by 2030.”
Chief executive Shirine Khoury-Haq said the group was adapting to difficult trading conditions and geopolitical uncertainty.
“Trading conditions remain difficult and the current geopolitical landscape is adding further instability, but we have reasons for optimism.
“Including our own estate and partners, we supply close to 8,000 stores; our new Commercial and Logistics business is turning this strength as a supplier into a path to growth.”
She added that Life Services grew despite disruption, while the wholesale business had been reset with a new partner proposition, and the group was investing in online convenience, health-led ranges and stores.
“We're confident in the road ahead,” she said.
By division, Food Retail revenue declined 2% to £7.25bn, although it grew 1% excluding the cyber impact, with underlying operating profit of £34m.
Wholesale revenue fell 2.2% to £1.3bn, though it rose 1.3% excluding tobacco, while Life Services revenue increased 4.2% to £418m, or 6.9% excluding the cyber effect, generating £41m of operating profit. Franchise revenue rose 23% to £91m.
The group said it grew its quick commerce business by 15% and expanded online services to additional stores, while also launching new product lines and price-matching initiatives.
It also reorganised its wholesale operations and created a new Commercial and Logistics division to centralise buying across its network of around 8,000 stores.
Looking ahead, Co-op said it expected external pressures including weak consumer confidence to persist, but aimed to return to its 2024 trajectory, when underlying operating profit rose 35%.
The group said it was targeting £200m of annual cost savings in 2026 while continuing to invest in growth, accessibility and value, alongside its longer-term goal of reaching net zero by 2035.
Reporting by Josh White for Sharecast.com.
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