Profits at the Co-operative Group fell by a third today after its food stores suffered amid "fierce" competition from supermarkets and its banking arm was hit by the recession.
The group, which last year admitted it was battling the toughest conditions for 40 years, said its 3,000-strong food store division was also hurt by the wet weather as people drove to supermarkets rather than walk to local shops.
Underlying sales in the division fell 1.2% in the 26 weeks to June 30, while operating profits dropped 16% to £119m.
Its banking division, which has agreed to buy 632 branches from Lloyds, also felt the pain, with operating profits down 67.9% to £36.9m as it bore the brunt of the UK’s double-dip recession.
With its two biggest divisions suffering, overall group profits fell 34% to £174m.