Post Office profit falls to £53m

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Chief executive says Post Office is 'cautiously optimistic' despite first half operating profit down £8m on a year ago

The Post Office made an operating profit of £53m in the first half of the financial year, £8m down on a year ago, new figures have shown.
Revenue fell by £21m to £604m, including a £9m decline from government services.

The Post Office, which is independent of the recently privatised Royal Mail, said its operating costs had fallen by £15m to £422m, mainly due to lower sales volumes.

Its chief executive, Paula Vennells, said: "Like many high street retailers, this has been a challenging six months for the Post Office but we are cautiously optimistic that the economic climate is improving and we are well-positioned to take advantage of the increased levels of consumer confidence.
"It is now 18 months since the Post Office began operating independently of Royal Mail. The Post Office is going through a period of great change and innovation. We are resolute in our determination to build a flourishing modern business but one that remains the bedrock of communities across the country.

"Since the start of 2012, 1,400 branches have been modernised, offering a new customer experience, with extended opening hours totalling over 34,000 extra hours a week."

Personal finance revenue increased by 23%, driven by growth in savings products, while financial services revenue increased by £1m to £139m.
The company said turnover in the six months to September was £501m, £18m lower than the same time last year.

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Healthy Post Office profits should make the settlement of the pay claim for 900 managers a top priority, Unite, the largest union in the country, said today (Friday 6 December).

Unite threatened that further strike action is on the cards, unless Post Office bosses made constructive moves to settle the 18-month dispute and “stop dragging their feet”.

Unite officer for the managers Brian Scott said “The Post Office has today announced an operating profit of £53 million for the six month trading period ending 29 September 2013. It also sets out a “profit for the period from continuing operations” of £190 million and “profit before financing and taxation” of £187 million.

“Whichever way you look at it the Post Office is in a healthy financial position and can easily afford to make a consolidated pay increase to staff; something it has adamantly refused to do since June 2011.

“Unite members in the Post Office have been working extremely hard to deliver change and it is clearly working. They, therefore, deserve recognition for this and a negotiated pay settlement is a priority.”

Unite managers have already taken two days of strike action last month and one day of action short of a strike in October.

Brian Scott said: “This year is the first time since 1979 that Post Office managers have taken strike action, which shows the strength of feeling on this issue.

“The top executives need to stop dragging their feet and get around the table, otherwise further strike action is a real possibility which would hit high street post offices.”

The Postal Services Act 2011 separated the Post Office business from the Royal Mail.