Business
UK hits ‘peak Costa’ as soaring prices see coffee chain’s losses double
Losses at Costa Coffee have more than doubled to £13.5m for 2024 as it struggles to compete with cheaper rivals.
The new financial filings from Companies House show they are up on £5.8m operating losses of the previous year and are in contrast to the chain’s fortunes before the Covid pandemic, when Costa was frequently posting annual profits of up to £100m per year.
Last year, it was widely reported that parent company Coca-Cola was seeking to sell the Costa Coffee brand, little more than seven years after buying it for almost £4bn. A sale this year is not expected to fetch more than £2bn, though recent reports have suggested there are concerns over the price of a deal with preferred bidder, TDR Capital.
Costa has said the most recent results were down to higher competition from other coffee house brands and lower footfall on high streets.
Additionally, the rising cost of coffee beans and other inflationary cost pressures on operating expenses had further reduced the profitability of the business across the year.
One analyst, Clive Black of Shore Capital, said: “It has perhaps reached the peak of its extent in the UK, ‘peak Costa’ if you like, which makes it more exposed than most to competitive challenges.”
Additionally, Black pointed out that a “whole plethora of independent, often artisanal players offering a better experience, a better ambience, a better story, so less corporate and much better food” was also a big factor for the legacy chain to contend with.
Analysis by the Telegraph suggested the average price of coffee has risen around 80p for consumers since 2022, to above £4 – but in many places it can be £5 or more.
Last autumn, Costa ran a limited-time deal in partnership with Co-op shops, where drinks were available for £1.
A Costa statement said: “Costa Coffee delivered like-for-like revenue growth in 2024 and demonstrated strong operational resilience despite inflationary headwinds. We continue to invest in our UK estate and the expansion of the Costa Coffee brand globally. These aggregated results are reported as part of The Coca-Cola Company.
“Since being acquired by The Coca-Cola Company in 2019, Costa Coffee has delivered continued revenue growth and is part of Coca-Cola’s strategy to offer a broad range of beverages for every occasion.”
The equity market came under heavy pressure on Monday, with investors remaining cautious amid escalating tensions between the United States and Iran, while the start of the roll-over period added to volatility.
The benchmark Pakistan Stock Exchange (PSX) KSE-100 Index closed at 167,691.08 points, falling 5,478.63 points or 3.16% from the previous session’s close of 173,169.71.
During intraday trading, the index touched a high of 174,336.85 before sliding to a low of 166,886.63, reflecting sharp swings throughout the session.
Market analysts attributed the decline to geopolitical uncertainty. Huzaifa Riaz, Director at Mayari Securities, said investors adopted a cautious stance due to rising US-Iran tensions and the absence of strong near-term market triggers.
US President Donald Trump recently stated he would decide within “10 to 15 days” whether to order strikes on Iran if nuclear negotiations fail.
Reports indicated that military options were presented to him, including potential actions targeting Iran’s leadership.
On the economic front, data from the State Bank of Pakistan (SBP) showed that profit and dividend repatriation by foreign investors rose to $1.677 billion during the first seven months of FY26, compared to $1.328 billion a year earlier.
Pakistan recorded a current account surplus of $121 million in January, supported by strong remittances and controlled imports.
However, the cumulative current account balance showed a deficit of $1.07 billion in 7MFY26, compared to a $564 million surplus in the same period last year.
Meanwhile, weekly inflation measured by the Sensitive Price Indicator (SPI) rose 1.16% for the week ended February 19, according to the Pakistan Bureau of Statistics (PBS), with year-on-year inflation recorded at 5.19%.
The previous session had seen the KSE-100 gain nearly 1,000 points, but Monday’s sharp sell-off reversed those gains as geopolitical concerns dominated investor sentiment.
Last Updated:
RBI Governor Sanjay Malhotra confirmed no systemic risk from the Rs 590 crore fraud at IDFC First Bank’s Chandigarh branch linked to Haryana government accounts.
RBI Monitoring Rs 590 Crore Fraud At IDFC First Bank, Assures No Wider Impact
The Reserve Bank of India (RBI) is closely monitoring developments surrounding the Rs 590 crore fraud reported by IDFC First Bank, with no broader systemic concern arising from the incident, said Governor Sanjay Malhotra told reporters during a press briefing held after the customary post-Budget address by Finance Minister Nirmala Sitharaman to the RBI’s Central Board of Directors.
“We are watching the development, there is no systemic issue,” Malhotra said, after being asked upon IDFC First Bank’s fraud case, in which the private lender has reported a fraud of Rs 590 crore with an account linked with the Haryana government at the Chandigarh branch.
The irregularities were linked to a defined set of Haryana state government accounts handled at that branch. The Haryana government has de-empaneled IDFC First Bank and AU Small Finance Bank with immediate effect.
Following the update, the bank’s shares crashed 20 per cent on Monday, bearing a heavy loss.
Bank Assures Limited Impact
IDFC First Bank clarified in its disclosure that the fraud is “confined to a specific group of government-linked accounts within Haryana government” operated through the Chandigarh branch. The bank emphasized that the issue does not extend to other customers serviced by the same branch.
The lender’s statement sought to reassure stakeholders that the matter is restricted in scope and does not reflect a wider operational breakdown. The RBI’s remarks further underlined that, from a regulatory standpoint, the episode does not pose systemic risks to the banking sector.
The development comes amid heightened regulatory focus on governance standards and internal controls within financial institutions. While investigations and internal reviews are expected to continue, the central bank’s position signals confidence that the broader banking system remains stable.
(With PTI Inputs)
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February 23, 2026, 12:59 IST
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