The Co-operative Group has posted a return to profit but warned that its members will have to wait until 2018 for a resumption in dividend payments.
The troubled mutual, which last year reported a loss of £2.3bn due to the near collapse of its banking arm, benefited from the sale of its farms and pharmacy operations as it posted a net profit of £216m for 2014.
Without the disposals the Co-op would, at best, have broken even, chief executive Richard Pennycook said.
He added that the Co-op had completed the rescue phase of its turnaround but said that a resumption of dividend payments was unlikely until after the rebuilding phase completes at the end of 2017.
Mr Pennycook said: “The hard work of rebuilding the Co-operative Group for the next generation, and restoring it to its rightful place at the heart of communities up and down the UK, is now under way.”
Mr Pennycook added: “We significantly reduced net debt, even after meeting our outstanding contributions to The Co-operative Bank.
“This followed the successful sales of our Farms and Pharmacy businesses and detailed work to ensure we have the right cost base in place. Our core businesses continued to deliver for customers, with their financial performances reflecting challenging trading conditions across all of our markets and the different stages they are each at in terms of Rebuild.”
The Co-op is the UK’s largest mutual business, owned by more than eight million members. It is the UK’s fifth biggest food retailer with almost 2,800 local, convenience and medium-sized stores.