Tag: UK

Mail posts gloomy forecast

Posted by | Nov 1, 2007 | |

Royal Mail profits fell by a third in the 2006-7 financial year, mainly as a result of a sharp rise in pension fund costs.

The group faces operating at around break-even this year and next, it said.

Chairman Allan Leighton and chief executive Adam Crozier said pension costs, revenue decline through losses to competition and the overall fall in mail volumes meant Royal Mail’s letters division was heading towards break-even in the current financial year.

They added: “Without the contribution from GLS (General Logistics Systems, the group’s European parcels business), the group could again become loss-making.”

The group said profits for 2006-07 were in line with expectations at £233m, down a third, mainly due to pension costs rising by GBP 193m to GBP 722m.

Competition had developed much more quickly than anyone forecast. Rivals would this year be handling around 4bn letters, around one in every five posted – a level Postcomm had forecast would not be reached until 2010.

Read More

European parcels operation sparkles despite postal misery for Royal Mail

Posted by | Nov 1, 2007 | |

General Logistics Systems, the European parcels operation, is turning out to be the jewel in the crown for Royal Mail, which has seen profits slashed in its domestic letters business over the past year.

GLS increased its operating profit by 15 per cent to GBP 115m on sales of just over GBP 1bn for the financial year 2006-7. And there was also good news from Parcelforce Worldwide which made an operating profit of GBP 10m – double the figure for last year and the second year running of profit after more than 15 consecutive years of losses.

Royal Mail said Parcelforce Worldwide grew its revenue by 7.3 per cent in a market that became even tougher, and delivered a record operating profit of GBP 10m. GLS grew its revenues by 4.9 per cent in a very competitive market and its operating profit increased to GBP 115m. “The results of both GLS and Parcelforce Worldwide demonstrate the group’s potential in areas where it is allowed to compete freely without regulatory constraint.”

However, profits were slashed from GBP 344m to GBP 194m in the letters business which has also gone through a damaging strike.

“Inland addressed mail volumes fell by 2.3 per cent – the first decline after many years of growth,” said Royal Mail. “The growth in email undoubtedly played a key factor in the fall and the realistic prospect facing the Company is for further volume decline. The peak in mail volumes looks likely to be behind us.”

Read More

Royal Mail does not expect profit from letters this year

Posted by | Nov 1, 2007 | |

Royal Mail group has said its letters business will not make a profit in the current financial year, after revealing its 2006/7 profits fell 44pct to GBP 194m from the service.

Overall, the group’s operating profits, including its international parcel operations and the Post Office network, fell by 55pct to GBP 158m in the year ending March 25 2007.

Overall revenues rose 1.4pct to GBP 9.18bn, and letters revenues were unchanged at GBP 6.86bn, despite a 2.3pct fall in inland addressed mail volumes.

Chief executive Adam Crozier and chairman Allan Leighton claimed, in a statement issued with the financial results, that competition in the postal market had developed more quickly than the regulator Postcomm had thought when it fixed the price control for the company.

They claim competitors picked up one in eight letters posted in 2006/7 and will pick up one in five posted in Royal Mail’s current financial year. This is a level Postcomm forecast would not be reached until 2010.

Another point raised was that the average 13p access fee paid by competitors to use its delivery network does not cover its costs.

Looking at the first five months of the current financial year the statement said revenues are down GBP 78m over the same period last year.

The financial results drew comment from the Communication Workers Union, which after a series of strikes has recently agreed a pay and conditions deal with management that has been recommended to CWU members.

Read More

Union ire at Royal Mail boss pay

Posted by | Nov 1, 2007 | |

Figures in the Royal Mail’s latest annual accounts, released on Tuesday, show that Adam Crozier saw his pay rise by 26 pct in the year to 31 March.

Mr Crozier pocketed GBP 999,000 for the 12 months, up from GBP 790,000 in 2005-06.

The Communication Workers Union called for a review, but the Royal Mail said Mr Crozier deserved the increase.

‘Review needed’

In addition to the Royal Mail seeing profits fall by a third for the 2006-07 financial year, it was recently hit by strike action over staff pay and job security.

The reason Adam is paid what he is paid is that he runs a big company, he does a bloody great job and I’m glad we’ve got him

Royal Mail chairman Allan Leighton

The series of strikes ended after the Communication Workers Union (CWU) accepted a pay rise for its members of 5.4 pct from 1 October, and an extra 1.5 pct from next April.

The Royal Mail had initially offered 2.5 pct.

“Postal workers have had to take eight days of strike action this year to get any pay rise at all, while the chief executive receives GBP 1m,” said CWU Deputy General Secretary Dave Ward.

“It’s time to review pay at the top of the business.”

‘Bottom end’

Royal Mail chairman Allan Leighton defended Mr Crozier’s pay.

“The reason Adam is paid what he is paid is that he runs a big company, he does a bloody great job and I’m glad we’ve got him,” said Mr Leighton.

“Getting good people to run this company is very difficult.

“If you compare his package to FTSE 100 chief executives then it’s at the bottom end, not the top end.”

Mr Crozier is additionally in line for a bonus of up to GBP 1.1m, to be paid out next year if the Royal Mail meets certain performance targets.

He took up the top job at the Royal Mail in 2003.

Read More

Skillsmart Retail Analysis: Online retailing potential developments and its impact on people and skills

Posted by | Nov 1, 2007 | |

This analysis explores how the adoption of online trading has introduced new opportunities for retailers and how these might affect those who work in the sector and the skills they may need. It is based largely on secondary sources and commentary from retailers themselves.
We briefly chart how online retailing has moved from being viewed as a minority hobbyist pursuit, to one which is now a mainstream route for retailers.
Like many IT based innovations, the development of online retailing channels presents businesses with a range of new choices. In this sense, the development of the technology is a ‘driver’ helping to shape the future of the sector.
However, culture and politics in companies and of consumers will be complementary drivers and will also shape how the new technology will be applied.
We speculate that on balance the development of online retailing is likely to further increase the depth and breadth of many job roles in the sector.
Within senior managerial occupations, online retail will pose a series of strategic challenges around the role of their online trading platforms and evaluation of their success. Professional and associate professionals will also be affected as online retailing will increase the breadth of activities they have to deal with.
The fulfilment of orders will also lead to new demands. Warehouse systems may increase in their complexity. Many delivery personnel will be expected to offer more than a perfunctory drop off of the item; some might even e expected to offer advice and expertise on the product being delivered.
The blurring of boundaries between online and traditional retailing will also present interesting challenges for store managers, sales and customer service roles. Where online and traditional retail operations operate seamlessly, many employees will require knowledge of the entire range of products and services on offer and skills to carryout a wide range of processes.
Within the retail sector previous developments have focused on reducing errors. It has also helped develop job roles that rely on modest levels of skills. The development of online trading may reinforce this trend.

Read More

Advertisement

Advertisement

Advertisement

P&P Poll

Loading

What's the future of the postal USO?

Thank you for voting
You have already voted on this poll!
Please select an option!



View ResultsHide Results

Post & Parcel Magazine


Post & Parcel Magazine is our print publication, released 3 times a year. Packed with original content and thought-provoking features, Post & Parcel Magazine is a must-read for those who want the inside track on the industry.

Subscribe to the Magazine

 

Pin It on Pinterest