Co-operative Group posts operating profits of £72m for the 26 weeks to 2 July compared with a restated £95m a year ago.
Revenues rose to £4,699m - up from £4,561m - while operating expenses increased to £4,646m from £4,489m.
Food like-for-like sales rose by 3.1%. Core convenience business grew ahead of market after investment in price and products, with like-for-like sales up 4.3%.
- Funeralcare revenues held, with significant growth in pre-paid funeral plan sales offsetting lower death rate
- General Insurance (GI) delivered strong sales and profits performance, with more than 100,000 new policies sold in first half after launch of member-focused pricing initiatives
* Planned reduction in profit, driven principally by Rebuild investment, pay increases for frontline colleagues and price reductions in Food
- Underlying profit before tax* of £31m (2015: £63m)
- Profit before tax of £17m (2015: £36m)
* Half way through three-year Rebuild phase, with further investment made in improving our brand and membership offer
- Capex of £149m (2015: £144m) as further improvements made to food stores and funeral home estate
- Costs from supporting functions increased from £37m to £52m to support required investment in brand and membership relaunch, and creation of new Digital division
- Major investment in Co-op colleagues as 5,400 managers attend "Being a Co-op Leader" events and all 70,000 colleagues embark on "Back to Being Co-op" sessions
*More than 5 million members set to receive new Co-op cards to mark the launch of our compelling new membership offer, placing customers and communities firmly at the heart of the Co-op again
* Successful disposal of non-core food properties which do not align with food strategy focused on delivering a compelling and convenient shopping experience for members
* Debt at £0.7bn (2015: £0.6bn), in line with stated aim to keep debt around £0.9bn during Rebuild Group chief executive Richard Pennycook said: "These are exciting times for the Co-op as we continue to make this a better business that is more relevant for members, customers, communities and colleagues. These results, along with today's relaunch of our compelling new membership offer, show the real value of 'being Co-op' and our difference as a business.
"Revenues across the Group have grown and, in line with our strategy, profitability has fallen due to our major Rebuild investment, pay increases for our people and price cuts for our customers.
"We are able to invest for the long-term, strengthening the appeal of our products and services, because our business model allows us to pursue our unique approach, championing a better way of doing business for customers and communities.
"This long-term approach is evidenced by the continued reshaping of our Food store portfolio to support our own-brand, convenience-led strategy. This means we can, as necessary, forgo sales growth in order to ensure we have the right stores in the right places for our customers.
"We are only half way through the Rebuild and much remains to be done, whether it is investing in our digital capability or campaigning on key issues. We remain firmly on track with our plans and are encouraged that the work we are doing is attracting more and more people back to the Co-op."
At 9:21am: (LON:87GO) Cooperative Group Ltd share price was 0p at 112.5p