UK’s Co-op profit tanks 84% on supply chain snags, inflationary costs

Sept 29 (Reuters) – Britain’s Co-operative Group (42TE.L) reported a sharp drop in its interim profit on Thursday, as the supermarkets-to-funerals provider continued to face supply chain snags, and higher wage and energy costs, amid rising inflation.

“We know that the current testing conditions will not ease in the second half, and we will continue to face into the challenges” Chair Allan Leighton said in statement.

Confidence levels among Britain’s consumers sank to a record low this month as they battle higher costs of living, with the government’s mini-budget sowing turmoil in the mortgage market and leading to warnings of a sharp drop in house prices.

Higher energy and wage inflation increased costs in the first half of the year for the company, despite attempts to cut costs in order to offset some external headwinds.

The company also posted a slump of 84% in its first-half profit before tax to 7 million pounds ($7.54 million).

($1 = 0.9274 pounds)

Reporting by Radhika Anilkumar in Bengaluru; Editing by Rashmi Aich and Uttaresh.V

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