Sales have grown at the Central England Co-operative but increased pay for staff has dented profits, according to new figures.
The Central England Co-operative, which has dozens of stores and funeral homes across Peterborough, saw its sales rise by 2.6 per cent to £460.2 million in the first half of this year.
However trading profits dropped by £1 million to £11.9 million compared to the previous year largely due to improved pay rates for staff and other cost increases.
The Co-operative also says its year-on-year performance reflects the ongoing impact of intense competition in the grocery sector.
The society, which employs 8,600 people across the region, distributed £2.6 million to members, colleagues and the community.
It also invested £19.2 million in the first half of the year.
This has seen the core food business and funeral arm of the Society grow significantly, with further new openings and refurbishments planned for the second half of the year and in 2018.
Chief executive Martyn Cheatle said: “We are encouraged by our progress and have a clear strategy in place to respond to the challenges and opportunities ahead.
"We expect the trading environment to remain challenging and highly competitive for the foreseeable future, but are remain confident in our strategy and our co-operative point of difference which enables us to provide a relevant and attractive proposition to our members and customers."
The Co-operative says its food retail business enjoyed a positive performance, with further like-for-like sales growth in its convenience stores and strong trading during key periods such as Valentine’s Day, Mother’s Day and Easter.
The society’s investment programme continued including a new funeral home based in Orton, Peterborough, with an investment of £120,000.
Its funeral operations progressed with a pre-paid funeral plan offering via tailored marketing campaigns and continued investment in refurbishments of its funeral homes.
Its 19 Travel shops traded positively in 2017, with the niche holiday sector and tailor-made holidays performing well.