Co-op CEO demands pay cut as firm enters ‘calmer waters’

'Still much to achieve,' says Co-op boss Richard Pennycook
'Still much to achieve,' says Co-op boss Richard Pennycook

The boss of the Co-operative Group has demanded a pay cut after he said the firm had finally “turned a corner” thanks to rising sales.

CEO Richard Pennycook has asked the board to slash his pay from £1.25 million to £750,000 as the troubled mutual entered “calmer waters”.

The firm said like-for-like sales across its 2,800 food stores grew by 1.6% in the 52 weeks to January 2, while its funeral business saw sales climb by 9.9%.

Mr Pennycook told BBC Radio 4’s Today programme: “We’ve been through a difficult period which was very intense and I hope members would regard my remuneration as having been appropriate for that time, but we’re now in calmer waters, we’re a different sort of organisation owned by its members.”

The firm said pre-tax profits hit £23m, down from £124m in 2014 when it was boosted by a £121m one-off disposal.

It said underlying profits in the food business rose 3.3% to £250m, as strong sales and moves to cut costs helped performance.

The funeral business also bolstered underlying profits by 18% to £78m over the period.

Group revenues fell slightly to £9.3 billion, down from £9.4bn in 2014, while group underlying pre-tax profits rose to £81m, up from £73m.

“This has been a year of further progress at the Co-op as we have invested to drive the growth of our businesses,” he added.

“Underlying profits have increased but our priority this year has been on putting the building blocks in place for the long term.

“We are, however, only one year into our rebuild and whether it is driving further growth in our businesses, improving member engagement or getting back to our campaigning roots, there is still much to achieve.”