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Troubled Royal Mail seeks UK boss to deliver turnaround

29 Sep 2019, 12:23

https://www.thetimes.co.uk/article/troubled-royal-mail-seeks-uk-boss-to-deliver-turnaround-qljljqtdp
Troubled Royal Mail seeks UK boss to deliver turnaround

John Collingridge
September 29 2019, 12:01am,
The Sunday Times

Royal Mail’s shares are down 22% so far this year

Royal Mail is recruiting a director to run its British operations as it heads for a showdown with postal workers and battles against slumping volumes in letters.

The 500-year-old former state-owned monopoly abolished the job a year ago when it ousted Sue Whalley, the chief executive of UK post and parcels, after a spell of dire trading. Finance director Stuart Simpson was handed the additional role of chief operating officer.

The board’s decision to appoint headhunters to fill the role again reflects consternation over its failure to get a grip on deteriorating performance in its UK business, which turns over £7.5bn and has 143,000 staff.

Royal Mail was ejected from the FTSE 100 in December and its shares are down 22% so far this year.

The new recruit will report to chief executive Rico Back, a Zurich-domiciled German who previously ran Royal Mail’s overseas interests.

Back has endured a tough time since taking the helm in June last year, incurring the wrath of investors over his £6m “golden hello”, despite being an internal appointee. Royal Mail declined to comment.

The Communication Workers Union is gearing up for a nationwide strike in the run-up to Christmas and opened a ballot on industrial action last week. Its 100,000 members are expected to strike over issues including employment terms and job security.

Adding to the company’s problems, letter volumes fell 8% in the year to March and UK operating profit was down a third to £332m. Royal Mail shares ended last week at 213.1p, valuing it at £2.1bn. They were priced at 330p in its 2013 privatisation.

Gerald Khoo, an analyst at the broker Liberum Capital, said last week that Royal Mail’s share price was “wholly unreflective of the structural challenges faced by the group that could lead to a long-term and irreversible squeeze of profit margins”. He advised investors to sell.

Comments(2)

londoncityboy

A CEO that fails to deliver anything gets £6m golden hello.
It is so much fun getting rich at the expense of investors and employees isn't it?
About time we, the shareholders, can oust those clowns and stop this lack of governance at companies.

Nicholas Beale

Appoint a remote CEO. Oust a super-competent woman, and give her job of running the main part of your business, part-time, to a man. What could possibly go wrong?
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Troubled Royal Mail seeks UK boss to deliver turnaround

29 Sep 2019, 14:38

You would think that, given the RM is a UK based company, that Rico Black is supposedly in charge of RM this would then mean that Rico Black would at least do something in terms of running the RM? Otherwise why pay him?

Troubled Royal Mail seeks UK boss to deliver turnaround

29 Sep 2019, 16:57

what a joke this is , how can he warrant the amount of money as the ceo he is paid and be paid to not even run the company or deal with the issues without even being in the UK , so he wants to rip our terms and conditions up , try and sell off Parcelforce and do the same with the rest of the company , get rid of 1000s of posties jobs , and the uso , but yet they say our SWW has to be self funding so who is going to pay this new UK bosses wages ? will this be also self funding ? or is Rico going to pay his/her wages out of his so called wages, hes way out of his league imo and the CWU and the members have proven this with whats going on and the I/A ballot , 100% CWU.

Troubled Royal Mail seeks UK boss to deliver turnaround

29 Sep 2019, 17:27

So RM couldn't afford the pension plan , fund the SWW but have found the money to offer managers a 2.6% pay rise and now they want to employee a UK HEAD HONCHO ? I wonder where this secret pot of money is ?

Troubled Royal Mail seeks UK boss to deliver turnaround

30 Sep 2019, 09:21

IT looks to me that Rico is just appointing a fall guy. Someone to take the blame for Rico's own failings.
Mr Back appears out of his depth and under his stewardship the shares have plummeted, the workforce is at unrest and faith in the business as a whole is at an all time low. The board need ousting too for appointing such a flop with a terrible vision for the business.

Troubled Royal Mail seeks UK boss to deliver turnaround

30 Sep 2019, 10:30

A very concise summary Rumple.

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