The Co-operative Group has unveiled financial results from a 'disastrous' year, the worst in its 150-year history, with losses confirmed at the bottom end of expectations.
The embattled mutual society lost £2.5bn in the year to January 4th, of which most came from the discontinued operations of its banking arm, which lost £2.1bn.
Chief Executive Richard Pennycook said: "2013 was a disastrous year for the Co-operative Group, the worst in our 150-year history.
"Today's results demonstrate that but they also highlight fundamental failings in management and governance at the group over many years.
"These results should serve as a wake-up call to anyone who doubts just how serious the challenges we face are."
The Co-operative Bank, where the group now holds a 30% stake, suffered a trading loss of £1.44bn in the year to December. As well as these losses, the group also suffered a loss on reduction in its shareholding in the bank.
The bank is facing a £1.5bn capital shortfall, which will require the group to decide whether to contribute further cash.
Group sales fell 4.6% to £10.5bn, from £11bn in 2012.
Net debt reduced by £286m to £1.4bn, driven by the disposal and sale and leaseback of property assets and the sale of the remaining motor dealerships. The group said it was continuing to look to sell its Farms and Pharmacy businesses.
As well as the banking losses, the group suffered a £247m writedown on its Somerfield supermarket acquisition, and falling food sales across its supermarkets business as it disposed of sites to focus on convenience stores.
Like-for-like food sales dropped by 0.2% last year, although they rose 0.6% in the second half. In the core convenience chain segment like-for-likes rose by 1.6%.
On the upside, funeral sales rose 3.4% to £370m and underlying operating profit increased 3.3% to £62m.
Pharmacy sales fell 0.5% to £760m, with underlying profits up 17.9% to £33m. General Insurance sales dropped 17.9% to £476m with underlying profits in that division rising almost threefold from £13m to £36m.
In June or July members will vote on the mutual's future at a special meeting organised in the wake of the shock resignation of Senior Independent Director Lord Myners a fortnight ago.
Members will vote on whether to accept proposals by Lord Myners for a radical overhaul of the group's highly complex management structure.
On Thursday, Chairwoman Ursula Lidbetter said: "During 2013, it became apparent that our governance had fallen far short of the standards to which we aspire as a co-operative society.
"Now is the time to put that right through fundamental reform - we have to act with urgency if we are to lay the foundations for a stronger, healthier co-operative business in the future."