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Reducing or removing the Coop dividend was always going to be a difficult message to get across to the public, according to its CEO.
A downward trend in profits has led to the announcement that the Channel Islands Coop is considering stopping or reducing dividend payout rates later this year.
The announcement led to confusion and concern from the public, with some rushing to withdraw what they currently have saved, and others calling for a boycott of stores.
It’s important to note that money already built up is safe and it’ll only be any potential dividend payout this year that’ll be affected.
The rate is decided each year and then voted on during the Coop Annual General Meeting (AGM).
"We've looked at various scenarios as a result of [this] decision,” said the CEO of the Coop, Mark Cox.
“I think what we've got to realise is that this is unprecedented. We are going through difficult times and challenging conditions. It's not unusual for businesses to review their dividends. It is [however] unusual for the Coop, and we fully accept that. What we'd hope is that members will support their Coop through the bad times and the good times.”
Pictured: CEO, Mark Cox.
The Coop has also confirmed that it has binned bonuses for staff members for 2024 due to the financial pinch.
It’s not all doom and gloom however, the dividend payout is dependent on the year and Mr Cox said if the divi for 2024 is scrapped, it could come back in 2025.
“The key principle for the Coop is to share its surpluses with its members, and that absolutely depends on the success of the business in that financial year.
“So, we can't take dividends for granted... But if the performance is sufficient, we can share profits.”
Mr Cox said it would be unusual for the voting members to vote against the Coop’s proposals.
"The board has delegated authority from the members to propose the divided – as they are best place to do that. They will propose the dividend and that will then be voted for or against by members - what members can't do is vote to increase that dividend. So, they have to accept or decline the proposition.”
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