How is the Co-op recovering after a tumultuous start to 2026?

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The Co-op will update on its recovery efforts in interim results on Wednesday after a difficult start to the year for the group amid management upheaval and tougher trading.

Under the leadership of interim chief executive Kate Allum, the Co-operative group will reveal how it has fared in the six months to July and progress with its cost cutting programme.

The Co-op has seen a major management shake-up in 2026, with former chief executive Shirine Khoury-Haq stepping down in March, followed by ex-chairwoman Debbie White in August, while managing director Matt Hood stepped down earlier in the summer.

It has contended with the impact of a costly cyber attack last year and recently was forced to defend itself from claims of a “toxic” environment at the business.

The mutual is also pushing ahead with plans to cut £200 million this year in order to offset higher costs and secure its long-term financial stability.

It has not yet revealed what impact this will have on jobs at the group, which runs more than 2,300 food stores and 800 funeral homes across the UK.

The cost savings programme comes after the Co-op slumped to a £126 million underlying pre-tax loss for the year to January 3, compared with a £45 million profit a year earlier.

Retail expert Jonathan De Mello, founder and chief executive of JDM Retail, said: “The upcoming half-year results will be a telling barometer of how successfully the Co-op is steering through its recovery plan following a trying period marked by leadership upheaval and significant financial headwinds.

“With new leadership now at the helm, members will primarily be looking for hard evidence that the group’s promised cost-rationalisation programme is actively arresting losses and stabilising the core balance sheet.”

The group is also pressing ahead with a planned takeover of smaller rival Southern Co-op in what will add 330,000 members to its existing seven million, as well as about 300 food, funeral and Starbucks coffeehouse sites.

“Members are rightly eager to see a return to robust convenience profitability and clear strategic synergy from recent structural moves, such as joining forces with Southern Co-op,” according to Mr De Mello.

The Competition and Markets Authority (CMA) is investigating the deal and has concerns over some local areas, focusing on nearly 20 convenience stores and two funeral services sites owned by the pair, where it believes competition could be “substantially” lessened.

The firms have until September 22 to put forward measures to resolve any potential competition issues or face a full-scale Phase Two investigation.

The Co-op is hoping the tie-up and overhaul will help turn around its fortunes after being knocked heavily by a cyber attack last year.

In February, Co-op also defended its culture and the behaviour of its bosses after reports said senior managers had complained of a “toxic” environment at the retailer.

The chain said at the time it did not believe the criticisms “represent the views of our broader leadership and colleagues”.

Mr De Mello said: “The business is wrestling with a costly hangover from a major cyber attack that severely dented revenues and profits, alongside escalating regulatory and labour costs – including National Insurance increases, packaging taxes, and essential staff pay investments.

“At the same time, rising net debt and high lease commitments are squeezing cash flow.

“These pressures are further compounded by soft volume trends and aggressive competition.

“Balancing the democratic expectations of its six-million-strong membership base against these harsh commercial realities is a delicate tightrope act indeed.”