Royal Mail to deliver bad news on profits

Royal Mail is expected to reveal the brutal impact of fierce competition in Britain’s postal market this week when it unveils a dramatic slump in profits.

City analysts expect Royal Mail to report a 16pc fall in annual operating profit before one-off charges to £562m despite the demise of two rivals.

The weaker performance by the 500-year-old postal service is expected even though it has taken on extra parcel volumes following the collapse of CityLink in December last year and the suspension of delivery services by Whistl last week. It is now handling more than 2m extra letters a day.

The Royal Mail, which floated on the stock exchange 18 months ago, is under huge pressure from a structural decline in the number of letters. The parcels arm is also being hit by online shopping site Amazon setting up its own delivery service.

Source: SUN Royal Mail to deliver bad news on profits – Telegraph

  • Been.Frank.len

    I hope the members of Congress who would like to see the USPS privatized and sold off take heed of what is happening in the UK. After 18 months, the story says 2 rival mail services (private companies) have dropped out, and Amazon is setting up its own delivery system. It’s hard to imagine the mail service to UK customers improving after the Royal Mail was sold out.

    However, the sale of the Royal Mail gave well-connected wealthy people in the UK a one-time chance to turn a quick buck when the Royal Mail was offered at a fraction of its value in its IPO.

    Is this what some members of Congress want? A quick buck?

    The moral of the Royal Mail story is there isn’t enough mail volume in the UK for more than 1 delivery service to remain in business, and provide good service to the public. If the USPS were privatized and sold here in the USA, we’ll probably see the same results that have happened in the UK.

    The USPS was never meant to be a profitable business for the US Govt or anybody else. It was meant to be a service to the citizens of the USA.