The Co-op grocery chain has revealed its losses from crime rose by almost 20% to £40m in the first half of the year, and it is now deploying artificial intelligence to identify offenders with concealed weapons and stolen items.

The member-owned mutual, which returned to profit despite the growing toll of shoplifting, has spent £18m so far this year on measures to protect staff in its food business, including rolling out body-worn cameras and fortified kiosks.

It also includes installing AI technology in 14 of its stores to detect if someone has left without paying for an item, or whether someone has entered with a concealed weapon.

The technology, which is being rolled out on a trial basis, can also identify if a physical assault against a member of staff is taking place and alert a centralised monitoring station run by Mitie to request support.

The Co-op said the system did not use facial recognition technology. However, the group is is participating separately in the controversial Project Pegasus, in which CCTV images are shared with 15 of the UK’s largest retailers and the police, which are then run through databases using facial recognition technology to identify serial thieves and dangerous individuals.

Despite efforts to reduce crime, the grocery chain took a hit of £39.5m from theft and fraud in the first six months of 2024 – up 19% on a year earlier – even as it increased campaigning on the problem.

Matt Hood, the managing director of food operations, said: “It isn’t going away. The reality is that every day four of our colleagues are attacked, up 34% on 2022, and scarily, a further 115 of my colleagues will be seriously abused, up 37% on two years ago.”

Hood said while the businesses investments were working to make colleagues safer, he believed there would not be an immediate drop in thefts this year.

“I would love to sit here and say yes [there would be a drop in the second half of the year] … that all the money we are investing will pay off,” he said. “But I think it is going to be slightly longer term than that, and that has to be in conjunction with any changes the government makes to the law.”

The company has previously said organised criminals were behind the rise in shoplifting and violence against shop workers, rather than individuals stealing to survive. The group lost £70m from shoplifting in 2023.

The chief executive, Shirine Khoury-Haq, said she was pleased that the government planned to change the law to make shoplifting a standalone offence but the group said it needed to come into effect “as soon as possible”.

The retail-to-funerals business said it returned to profit despite the hit from shoplifting and a soaring wage bill.

The group reported pre-tax profits of £58m for the first six months of 2024, against losses of £33m a year ago, and said its stronger balance sheet would allow it to expand with new stores and possible acquisitions.

Food sales rose 3.2% across its stores, driving a 10% increase in underlying earnings at the division.

Co-op’s half-year results revealed that its wage costs had jumped by £39m as it increased pay to match April’s 9.8% rise in the “national living wage”.

However, it was helped by rising numbers of members as it invested £55m in prices, putting the business on track to reach its goal of 8 million members by 2030, from 5.5 million currently.

The group also set out plans to open 120 retail stores across the UK by the end of 2025.