HEART OF ENGLAND CO-OPERATIVE SOCIETY DEFIES THE DOWNTURN TO ANNOUNCE ANOTHER RECORD YEAR OF TRADING PROFITS

The Heart of England Co-operative Society, which has branches across Coventry, Warwickshire and south Leicestershire, is celebrating another record year of trading profit.

Despite a continuing downturn in global trading conditions the Society, the largest independent retailer in the region, achieved a trading profit of £4.25 million – representing an increase of six per cent on the previous year. Its annual turnover topped £81 million.

The good news comes in the midst of the worst economic period in Britain since the Great Depression of the 1930s.  The past 12 months has seen many of the UK’s major retailers fold while several others continue to issue profit warnings.

The Society’s figures firmly establish it as one of the most profitable retail co-operative societies in the country. Its net worth now stands at a record £37 million.

Speaking about the financial performance of the Society during the past 12 months Ali Kurji, Chief Executive, said: “The last year has been a particularly tough year for trading – even tougher than the year before – so we are absolutely delighted to have achieved record levels of profit once more.

“Everywhere has been hit hard since the start of the downturn in early 2008 and the Society is no exception to the current economic climate. The high rise in fuel costs and the credit crunch have hit the consumer pocket hard and certainly added to the extreme trading conditions.

“However we are pleased to say we have achieved satisfactory results across all of our trading divisions – Food, Non Food, Travel and Funerals. Policies we have had in place in recent years are allowing us to continue to build an increasingly strong regional co-operative business.”

Mr Kurji highlighted the Society’s Food Division as one of the strongest areas of the business, with like for like sales increasing by 8.6 per cent on the previous year.

The Non-Food Division faced a difficult challenge in maintaining growth and profitability, particularly in electricals and furniture. However like for like sales only fell by just one per cent over the year which Mr Kurji said was better than expected considering the current trading conditions.

Travel Division bucked the national trend and recorded a sales increase of 8.2 per cent over the year. Mr Kurji said although staff were delighted with the increase they were expecting a tough year ahead, with tour operators decreasing the commission and with the continuing growth in internet bookings.

Although the funerals industry is in decline nationally, the Society’s Funeral Division has maintained its market share and increased sales by 12.8 per cent. Over the past year the Society arranged 7.1 per cent more funerals than in the previous 12 month period.

Mr Kurji put the Society’s success down to the dedication of its staff and the loyalty of its customers who once again over the past 12 months had continued to reap the benefits of its ongoing programme of investment.

During that period the Food Division saw the opening of a new £1.3 million Lateshop in Camp Hill, Nuneaton, the £670,000 refurbishment of the Lateshop in Barwell, Leicestershire and the £668,000 refurbishment of Norman Place Road Lateshop in Coundon, Coventry.

Non Food staved off a fierce market which saw a number of well established high street names such as Woolworths and Zavvi fold. At the beginning of 2008 the Society joined the Co-op Electrical Buying Group, allowing customers to benefit from a wider range of electrical goods, competitive prices, promotional offers and quick delivery service. Rooms of Coventry also saw the introduction of three new ladies’ fashion concessions.  Additionally work on the refurbishment of the Hinckley Department Store is ongoing in the background and the Society will soon be in a position to start the re-fit. Non-Food also invested in five new delivery vehicles during 2008, worth a collective £150,000.

The Funeral Division saw the opening of its first Asian Funeral Home, aimed at client families of all races and cultures. Also earlier this year the Division opened its 10th home in Daventry, Northamptonshire. Other investments included five brand new vehicles – three Jaguars collectively worth £225,000 and two new Ford Galaxys worth £48,000.

Mr Kurji said increased profits would allow the Society to continue sharing its success with customers, members and the trading area community. Money raised through the Society’s unique Helping Hearts scheme – which for the last nine years has pledged every penny of the Heart of England’s tobacco profits to charitable organisations and worthwhile causes in the trading area – has topped £486,000.

Mr Kurji said: “The fact we have enjoyed an increase in profit is without doubt thanks to the ongoing loyalty of Society customers in our Food, Non Food, Travel and Funeral divisions.

“As our way of saying thank you we take pride in sharing in our success through ongoing refurbishments and improvements of facilities at our various outlets to help make our customers’ experience more pleasurable.

“Once again I would like to say a big thank you to the 988 staff who work at the Society – both on the shop floor and behind the scenes. Without their ongoing loyalty and commitment we would not have been able to achieve this success.

“Even though we are in tougher times they have continued to go beyond the call of duty for the benefit of the Society, our customers and members across Coventry, Warwickshire and south Leicestershire. We are delighted once more that their efforts have helped the Society reap dividends."