Co-operative Legal Services makes profit of £26,000

Co-operative Legal Services has announced a growth in revenue of nearly 13 per cent last year, taking its total annual revenue to £33m.

However, its profit for 2012 was only £26,000. In a group financial statement released this morning the lack of profit was attributed to “significant investment for future growth, changes to both pricing of services and the nature and duration of cases”.

It is understood that this includes the set-up costs of the family law service in Paddington, launched last November. Co-operative Legal Services (CLS) also offers personal injury advice, along with probate, conveyancing and employment.

This morning’s statement went on: “In Legal Services we continue to deliver our ambitious growth plan.

“Year-on-year investment in people, infrastructure, processes and marketing grew significantly and helped to drive revenue growth of nearly 13 per cent to £33m. “Even more encouragingly, our probate volumes were up 55 per cent, while our new family law practice has gained market share quickly with caseloads up significantly.

“We are working to become the number one legal service provider in the UK and are creating thousands of new jobs in the process.”

The Co-op’s funeral business was extremely profitable last year, which may help explain the rapid expansion in probate advice.

Funeralcare reported a £5m increase in profits, from £55m in 2011 to £60m last year.

The Co-operative Group as a whole announced a loss, before tax and member payments, of £599m.

Peter Marks (pictured), group chief executive, described 2012 as a “challenging year” and said the group’s profit was “adversely impacted by a number of factors within the bank”.

Marks went on: “These included a realistically cautious approach to the impairment of corporate loans within the non-core business, further PPI provisioning and the write-down of IT assets, together totalling £650m.”

He announced that the Co-op Bank would be selling its general insurance division, following the signing of a binding agreement earlier this week to sell its life and savings business.

“We have effectively pursued a strategy of building strong positions in our chosen markets and are coming through the worst economic downturn I have seen in 40 years in business,” Marks said.

“Our ownership model means we have and can continue to take decisions for the long term. The strength of our capital position enables us to absorb short-term losses.”