Discount supermarkets pinched profits at the Co-Op last year, according to the latest annual report released this morning.

And shoplifters have also been busy squeezing the people's supermarket.

Bearing out on an earlier warning from the mutual society that profits were likely to fall, pre-tax profits dropped in the 12 months to the end of December to £28m from the previous year's £268m.

In its assessment, the Co-operative Group, which employs 56,000 colleagues and also operates in the funeral, legal and insurance sectors, cited the divestment of its petrol forecourt business to Asda in 2022.

On a more positive note, underlying operating profit emerged at £97m, compared with £83 million the year before.

But the fast-growing blight of shoplifting , addressed by the Co-Op as "retail crime" took its toll: some 336,270 incidents of shoplifting  and anti-social behaviour were collated across the Group's stores in 2023, signalling a 44% rise on the previous year.

Data crunched by food retail analysts Kantar found that the seventh biggest supermarket brand ended 2023 with a grocery market share of 5.4% - a drop of 20 basis points.

Fighting a rear-guard action on value against Aldi and Lidl, the brand, which is celebrating its 180th anniversary this year, also continues to retain customer appeal against market leaders Tesco and Sainsbury's.

Many positives, however, lie within the Co-Op's annual financial roundup:

● Excluding the impact of the petrol forecourt sale in 2022, revenue increased 4.7% or £0.5bn.

● Net debt coninues to be paid off: it was £322m in 2022 but is now down to £82m.

● Online sales continued to grow, reaching £311 million (2022: £222million).

● Funeralcare revenue rose by £6m to £281m (2022: £275 million), legal services rose to £68 million (2022: £46 million) and insurance steped up by £5m to 29m on 2022's figure of £24m.

Debbie White, Chair of the Co-op, said the retail giant was at a "pivotal moment".

She added: "The dedication and hard work of our 56,000 colleagues delivered both a financially strengthened Co-op, which ended the year in a much stronger position than the previous year, as well as a reinvigorated Co-op, which is well-placed to continue to grow membership and create more value for its member-owners. This includes expanding financial rewards, fostering more opportunities for engagement, and facilitating meaningful contributions to communities across the UK."

Membership noticeably rose in 2023, leveraged by the Co-Op's introduction of member-only discount pricing in a move that mirrors Tesco's Clubcard system. In total, more than one million new members joined in 2023, increasing the active membership base to more than five million member owners - a 14% year-on-year increase.

● Started by the Rochdale Pioneers and forming the first Co-operative Wholesale Society in 1863, the Co-Op brand boasts the oldest supermarket in Britain – Manor Park, in London, was opened in January 1948.