Co-operative Group has said its local format has helped it report record results, with operating profit before significant items up 11 per cent to £393m.

Co-op chief executive Peter Marks said: “In the current climate customers are using local shops more, rather than doing big, expensive shops. And when they do come to us they are finding that their local shop is a far better entity than it was six to 12 months ago.”

The food to pharmacy and funerals business reported gross sales including VAT up 15 per cent, breaking the £10bn barrier, for the full year ending January 10, 2009.

Like-for-like sales in its food business were up 5 per cent, excluding petrol, and profit rose 38.1 per cent to £219.1m. Like-for-like sales for the first quarter of 2009 were up 6.5 per cent, excluding petrol.

Co-op has now completed its Somerfield acquisition and has started the rebranding of Somerfield stores. It has also rolled out Somerfield’s Simply Value range to all its shops. Somerfield’s Bristol head office will relocate to Manchester next year.

The retailer’s banking arm reported a 49 per cent uplift in operating profit before significant items to £24.7m. Marks said: “We didn’t take the risks that PLCs would take; we are good old-fashioned banking, and are attracting new customers.”

He said of Tesco’s move into banking: “Tesco is a PLC just like the banks, so what’s the difference?”