Losses balloon for Royal Mail as strike motion continues to take its toll

Royal Mail confirmed plans to chop 10,000 jobs by subsequent yr as losses proceed to widen because of ongoing strike motion and inflationary strain.

Royal Mail’s dad or mum agency International Distributions Services posted an working lack of £163m within the half yr, 152.4 per cent down from the earlier yr, the place it had a revenue of £311m.

Revenue was additionally down practically 4 per cent to £5.7bn, with Royal Mail‘s supply arm tumbling 10.5 per cent to £3.6bn.

Chief government Simon Thompson stated that he would do “no matter it takes” to show the corporate round, confirming plans to shrink the workforce by 10,000 by August subsequent yr, with round 5,000-6,000 redundancies required this yr.

Royal Mail entered into pay discussions with Communication Workers Union (CWU) earlier within the yr over the agency’s 5.5 per cent pay rise.

CWU balloted its members twice on this provide, which it referred to as “enough” towards hovering inflation, and has held eight days of business motion this yr.

The agency estimates that this motion has had a direct internet affect of round £100m on adjusted working revenue.

Thompson stated conversations with the union are ongoing, with the CWU attributable to take additional motion over Black Friday – the most important purchasing day for on-line retailers and supply companions.

The Royal Mail boss stated the agency was engaged on contingency plans, however wouldn’t elaborate on any the progressing talks with the CWU.

Thompson as an alternative stated that the Universal Service requires “main reform”, and confirmed that the federal government had been approached to hunt an early transfer to a 5 day letter supply, down from six.

International Distributions Services continues to count on a full yr adjusted working lack of round £350m to  £450m, together with the direct affect of 12 days of business motion, which have taken place or have been notified, however excluding  any expenses for voluntary redundancy prices

From an investor perspective, the supply agency stated it could not be paying an interim dividend, with the important thing concentrate on “stabilising Royal Mail”.



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