Royal Mail told to prepare for sell-off

[TrueBlueTerrier]

http://business.timesonline.co.uk/tol/b ... 131801.ece" onclick="window.open(this.href);return false;

The sell-off of Royal Mail has been revived by the coalition government, which has signalled it is looking for an “injection of private capital” into the state-owned postal provider.

The announcement came as Royal Mail announced that it had shrugged off last winter’s strikes and the long-term fall in mail volumes to post a 26 per cent rise in operating profits to £404 million.

The decision by the Conservative-led government to press on with a part-privatisation of Royal Mail will raise tensions not only with staff and the Communications Workers Union (CWU) but also among some Liberal Democrat MPs.

The Conservatives have previously backed the sale of a 49 per cent stake in Royal Mail, which could attract private equity investors. It seems likely that the European parcels business, its most successful operation in recent years, will also go up for auction.

The future of Royal Mail remains uncertain, though, because no solution has yet been found to plug its £10 billion pension fund deficit.

Royal Mail said that its improvement in profits in the year to the end of March came despite falling mail volumes — it handled 13 million fewer letters last year, down more than 7 per cent.

More than a third of letters posted in Britain, including the bulk postal needs of banks and utilities, are now handled by private competitors.

Customers are also switching to electronic forms of communication, such as texting and e-mails, while others have opted to use the cheaper second-class mail.

These factors sent Royal Mail revenues down more than 2 per cent to £9.3 billion, the first fall in sales for a decade.

The rise in profits was due to cost-cutting measures which led to 8,000 jobs being lost in the past year — all through voluntary means, according to Royal Mail.

The business spent £10 million a week, totalling £517 million over the 12 months, as it invested in new sorting technology, improving post offices and honouring its funding commitments to its pension schemes.

“These are good results achieved against a backdrop of harsh economic conditions and the relentless reduction in the number of letters sent by customers, not just in the UK but around the world,” Donald Brydon, chairman of Royal Mail, said.

“Huge challenges remain, including the need to find a resolution to our historic pension deficit and the need to reach agreement with Postcomm [the industry regulator] on a regulatory regime more suited to today’s changing marketplace.”

Mr Brydon said that strikes by the CWU last year over pay and working conditions “clearly had an adverse effect” but that the subsequent deal with the union would mean “further progress towards our modernisation goals and help us to protect the universal service while providing a fair reward for our people”.

Royal Mail letters doubled their profits to £121 million but operating earnings for the European parcels business, General Logistics Systems, fell 10 per cent to £112 million, blamed on economic contraction in Germany.

Profits at the Post Office increased by 75 per cent to £72 million partly due to a rebranding as the people’s Post Office. Parcelforce, the time-guaranteed delivery operation, increased its profits by £5 million to £17 million.

[Broxi51]

Did the tories or the lib dems not say in their election manifesto that referendums would be held for all decisions that are in the public interest?

[sevenandseven]

More than a third of letters posted in Britain, including the bulk postal needs of banks and utilities, are now handled by private competitors.

And largely delivered by Royal Mail!

Are journalists the most ill informed and lazy people in the world?

[DirtyHarry]

Are journalists the most ill informed and lazy people in the world?

In a nutshell, yes.

[balintober]

it was just on sky news, private equity firm CVC has revived its interest in buying a third of Royal Mail.
I think these are the same lot that Mandy pandy tried to hawk us off to.

[Stormproof]

CVC bought out the AA then sold most of the assets off/made 1000's of people redundant. They also own Saga and by all accounts have ruined that firm aswell.

[montriff]

More than a third of letters posted in Britain, including the bulk postal needs of banks and utilities, are now handled by private competitors.

And largely delivered by Royal Mail!

Are journalists the most ill informed and lazy people in the world?

looking at my fittimg every morning i would say its a lot more than a third

[DGP1]

I think we'll need some of this


Dara O'Briain seems like who we could use to fight our corner

[meercat]

CVC's experience in the European postal market dates back to 2005, when it bought a 22% stake in Post Danmark from the Danish government. It later teamed up with Post Danmark to acquire half of the Belgian post office. Last year Post Danmark was merged with the Swedish post office, Posten, giving CVC a minority stake in the new combined company based in Stockholm.


http://www.guardian.co.uk/business/2009 ... ate-equity" onclick="window.open(this.href);return false;

[uprising95]

what would this mean though if it got part privatised .
i thought it was obviously that everyone wanted it to stay in the public.


i dont understand.
can anyone explain please.

[smokerjim]

what would this mean though if it got part privatised .
i thought it was obviously that everyone wanted it to stay in the public.


i dont understand.
can anyone explain please.

Everyone does want it to stay public....except those with a vested intrest ( such as people able to get subtle backhanders, the ability for "insider trading" of the tendering process or just those that want an easy directorship, with a fat sack of cash, huge bonuses and sod all work ) not that such people exist in this Govt or it's predecessors - perish the thought.