Co-op chief Steve Murrells vows to keep a lid on food prices

The boss of Co-op on Friday struck an upbeat tone as the grocery-to-funerals group continued to be buoyed by its revived food business.

Chief executive Steve Murrells said he was confident about the way “they do business” — focusing on convenience retail and wholesale — despite fierce competition and possible Brexit-related pressures.

“It’s getting tough out there, but we’ll lower prices as best we can and put a ceiling on inflation,” he added.

The mutual is enjoying a revival after slumping to a £2.5 billion loss in 2014 in the wake of the Paul Flowers Crystal Methodist scandal.

Sales were up 10% at £5 billion for the half year to July 7, thanks to its buying convenience store chain Nisa for £143 million. Food sales were also strong — up 3% at £3.6 billion and same-store food sales were up 4.4%. Pre-tax profits rose to £26 million from £14 million.

The only sticking point was its insurance business, where underlying losses widened to £4 million from £1 million the year before. Murrells said it was a blip, because of the Beast from the East, and insisted that insurance was a core part of the mutual despite reports it is looking to offload part of it.

The Co-op also bought a repeat prescriptions tech start-up, Dimec, marking its return to health, after years offloading several businesses, including its farms and pharmacies.