Scotmid Coop’s trading profit for last year was £3m - down £2.7m on the previous year.
After emerging from the pandemic, the last 12 months was dominated by the cost-of-living crisis and escalating overheads - especially energy costs.
The society stated that it has responded to this turbulent economic backdrop by reducing controllable costs, maximising sales opportunities and strategic capital investment.
For the year ended 28 January 2023, turnover was up £3m to £406m up £3m, while £21.9m was invested in capital projects.
Semichem made "positive progress" in its recovery from the pandemic and moved to a new freehold warehouse.
Meanwhile, Scotmid’s property business delivered income growth, benefiting from the timing of investment property transactions and commercial property rent reviews.
Scotmid funerals conducted a similar number of funerals as last year, with continued demand for full-service funerals.
John Brodie, chief executive of Scotmid Co-op, said: “Our food convenience business faced the most significant challenges in the year - there were a number of factors that impacted performance including energy costs, food price inflation, pay rate growth and low consumer confidence from the cost-of-living crisis.”
He described underlying financial performance as "solid", especially against a background of low consumer demand, soaring inflation and supply chain disruption.
Significant capital investments were made during the period and net assets increased by nearly £10m to an all-time high of £122.5m.
“Last year-end, I highlighted the significant inflationary cost challenges facing the society, but in reality, the background trading environment in 2022 was much more challenging than expected,“ stated Brodie.
“The prolonged war in Ukraine, post-pandemic global demand, high UK inflation and, especially the rise in energy costs meant that both businesses and households have faced a cost-of-living crisis.”
He added: “Most of our business cost increases were mitigated, but the energy cost escalation could not be covered by initiatives, especially in an environment where sales growth was challenging.
“Looking forward, I remain cautious in the short-term. In saying that, our balance sheet is stronger than it has been throughout the society’s 163 history and guided by our core purpose, this provides the opportunity to seek out longer term opportunities and navigate carefully through the cost-of-living crisis.”
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