Scotmid Co-operative Society has reported it managed to improve its balance sheet despite the pandemic experiencing a £10m increase in its net assets taking it to £112.7m
The society reported a £5.7m trading profit for the 52 weeks ending on 29 January 2022 compared to £6.4m for 53 weeks last year.
It reported its turnover had decreased by £6m to £403m compared to the 53 weeks reporting period last year.
Despite the impact from the pandemic on its business beginning to “unwind” the company managed to reduce its netdebt to £7.4m.
Scotmid also reported it had invested £12.8m through capital investments in the business which was up by 35% from last year.
The company revealed that it had conducted less funerals last year, due to a “reduction in the severity in the pandemic” and that funeral plans will now be regulated by the Financial Conduct Authority following a Treasury investigation.
Its property business experienced an “improvement” in the Edinburgh residential market with the value of its portfolio increasing by £2.9m and the year-end valuation of the portfolio for the first time exceeded £100m for the first time.
It also reported that its surplus after tax for the financial year was £4.2m, which was up by £2.9m on last year.
It reported the main reasons for the higher surplus this year were a £2.4m increase in the property revaluation gain and a £800,000 decrease in “finance charges (due to mark-to-market gains on interest rate swaps and lower net debt).
“The financial market conditions (increase in long term interest rates and positive investment performance) and society contributions resulted in a £7.2m reduction in our pension deficit.
“Overall, it was a strong year financially for the Society with net assets up by £9.9m to £112.7m and net debt down by £7.4m”.
John Brodie, chief executive at Scotmid Co-operative said, “This has been the second financial year impacted by the Covid pandemic and the varying effects it has had on our businesses. As we have gradually emerged from the crisis and moved to the "living with Covid" stage, the impact on the Society's businesses has reversed
“Semichem stores were fully open in 2021-22 and saw a steady improvement in sales as the year progressed. In contrast, consistent with the wider convenience sector, our food stores had a reduced local shopping benefit compared to the lockdown periods in 2020. The business also faced major challenges in supply chain and record sickness levels from the Omicron variant.”
“Our property business had a resilient performance coming out of the pandemic and Scotmid Funerals saw a return of demand for full service traditional funerals.”
“Last year, I highlighted the planning uncertainty surrounding the timing of the end of the crisis. Once again, the difficulties of forecasting in the current environment became clear when the pandemic was prolonged due to the emergence of the Omicron variant. As well as record levels of sickness due to Omicron, the Society has also had to navigate through some major challenges in the grocery supply chain. I am very proud of our colleagues who through hard work and dedication have continued to deliver for our communities despite the significant challenges faced.”
“Looking forward, there is still planning uncertainty concerning the exit from the pandemic but it is clear that the Society faces significant inflationary cost challenges in 2022.”
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