The Co-operative Farms – already the UK’s largest farming business – plans to double in size over the next few years to increase the proportion of British fresh produce sold in its stores.
The announcement came as the farms group revealed a record profit for 2008 of £5.7m, compared with just £2.5m the year before.
“With the wettest summer on record, food price inflation, the economic downturn and volatile markets it has been an eventful 12 months,” said managing director Christine Tacon.
“But, despite the difficulties, we had a good harvest, benefited well from fluctuations in currency and, most importantly, continued to increase the depth of penetration of our ‘Grown by us’ range into our food stores – something we are keen to extend even further in the future.”
The Co-operative Farms is working towards supplying 25% of the British-grown fresh produce sold in Co-operative Food stores by 2011.
“It’s an ambitious target, especially with The Co-operative acquiring Somerfield,” said Ms Tacon. “It will mean effectively doubling the size of the farming business, and we are developing schemes for working with other farmers to use their land and labour to help us achieve it.”
Other highlights for the past year included major investments in a new potato grading facility and potato storage at Carnoustie, near Dundee, and new potato and grain storage facilities at Coldham in Cambridgeshire.
The Co-operative Farms currently farms around 60,000 acres at 15 sites from the north of Scotland to southern England.
Overall, The Co-operative Group had a record year in 2008, increasing sales by 15% to over £10bn, making it the UK’s fifth largest retailer, and boosting operating profit 11% to £393m.
The food business increased sales 23% to £4.5bn and profits by 38% to £219m. The rebranding of over 700 stores generated an average 13% sales lift.
* For more on this story, visit Phil Clarke’s Business Blog