December 6, 2022
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Royal Mail parent slides to half-yearly loss as UK business drags

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Nov 17 (Reuters) – Royal Mail’s parent company International Distributions Services (IDSI.L) on Thursday reported a first-half loss of 57 million pounds ($67.88 million) as higher costs and disruptions arising from strikes by its postal workers put a strain on its finances.

The former British postal monopoly, which recently changed the name of its holding company from Royal Mail Plc, still expects full-year adjusted operating loss for Royal Mail – its UK business – of around 350 million to 450 million pounds.

It is targeting for Royal Mail to return to adjusted operating profit in full year 2024-25. The company maintained its forecast for GLS, its international division.

Royal Mail has been locked in a bitter dispute with its largest labour union – the Communication Workers Union (CWU) – over pay and operation changes at the over 500-year-old postal company, leading to several days of strikes in the past few months.

The union plans to hold more strikes in the run-up to the busy Christmas period, after it rejected a new conditional pay offer, which was subject to the CWU agreeing to changes such as Sunday working and flexible working.

Royal Mail had said it could cut up to 10,000 jobs and warned of more layoffs and even deeper financial losses if it cannot reach an agreement with the CWU.

The group’s revenue for the six-month period ended Sept. 25 fell nearly 4% to 5.84 billion pounds, dragged by weak performances at Royal Mail, while it also posted adjusted operating loss for the reported period versus a profit of 404 million pounds last year.

($1 = 0.8397 pounds)

Reporting by Yadarisa Shabong in Bengaluru; Editing by Sherry Jacob-Phillips

Our Standards: The Thomson Reuters Trust Principles.



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