THE CO-OPERATIVE Group named former Morrisons finance chief Richard Pennycook as its permanent chief executive yesterday as it revealed a half-year pre-tax loss of £9m.
Mr Pennycook, who lives outside York, has been stand-in boss since Euan Sutherland walked out earlier this year claiming the beleaguered food-to-funerals group was ungovernable.
The interim results come after the group reported a record £2.5bn loss for 2013, as it was dragged down by the near-collapse of its banking arm – and days after a vote by members approved a radical shake-up in the way the group is run.
Mr Pennycook, who describes himself as an adopted Yorkshireman, became Morrisons’ finance director in 2005 and played a key part, alongside chief executive Marc Bolland, in reviving the Bradford-based grocer after the troubled takeover of Safeway in 2004.
Mr Pennycook left Morrisons in 2013 after he was passed over for the top role in favour of Dalton Philips.
Before joining Morrisons he was the finance director of motoring organisation RAC and before that he was finance director of cider group HP Bulmer, homewares chain Laura Ashley and pubs group JD Wetherspoon.
He is a senior independent director at York-based housebuilder Persimmon and was awarded FTSE 100 Finance Director of the Year in 2011 at the FDs’ Excellence Awards. Mr Pennycook, who will be paid a basic salary of £1.3m, said the Co-op is now ready to rebuild its shattered reputation
Previously finance director, he had been standing in as boss since March after his predecessor left the firm.
The group said it has seen an overall return to profit and it now owns just 20 per cent of the bank, following a rescue which saw bondholders including US hedge funds take majority control of the lender.
Mr Pennycook said he is under no illusions about the scale of the job.
“The businesses are all underperforming and we make no bones about that, but they all fit very well with the purpose of the Co-op to serve our members and be at the heart of our communities,” he said.
He added there is still a lot of work to be done and admitted this is likely to mean further job cuts.
He said that the turnaround will take three years, but disposal of parts of the business, such as its pharmacies, will lay a solid foundation to re- build.
He will reveal his strategy at the full-year results next year.
The Co-op, like Britain’s other big supermarket chains, is being squeezed by discount retailers Aldi and Lidl.