LTB 501/12 Royal Mail Group Financial Results 2011/12

[TrueBlueTerrier]

02 July 2012
LTB 501/12 Royal Mail Group Financial Results 2011/12

TO: ALL BRANCHES WITH POSTAL MEMBERS








Dear Colleague



Royal Mail Group Financial Results 2011/12



Please find attached a summary of Royal Mail Group financial results 2011/12 with access to the full report via the link. Also attached is a copy of the press statement issues by the Union for your information.



Any enquiries should be addressed to the Acting DGS (P) Ray Ellis.



Yours sincerely









Ray Ellis
Acting Deputy General Secretary (P)

Royal Mail Group Financial Results 2011/12





Royal Mail has today announced its financial results for the year 2011/12. The results show some improvement in the company’s financial position; revenue and operating profits have increased, but against a background of continued decline in the volume of letters. The company’s cash position is now positive, following the recently implemented pensions solution. There has been a further increase in the volume of parcels and packets.





Royal Mail Group



· Group revenue increased by 4% to £9.5bn from £9.2bn in 2011.



· Group operating profit (after modernisation costs) increased to £211m from £39m in 2011.



· Group overall operating profit margin (after modernisation costs) increased to 2.2% from 0.4% the previous year.



· The Group had a positive cash inflow of £234m up from a cash outflow of £213m the previous year. This was greatly aided by the transfer of most of RMPP to government, meaning no pension deficit payment needed to be made this year (in 2011 a pension deficit payment of £292m was made). The cash position was also improved by the sale of assets.



· Ofcom’s significant deregulation of postal services and the subsequent stamp price rises announced by Royal Mail took effect from the beginning of April. Their impact on Royal Mail’s finances will be seen in next year’s annual report and accounts.





UK Parcels, International and Letters (UKPIL)



· Royal Mail reports the former Letters section and Parcelforce as one business unit.



· UKPIL revenues increased 4% to £7.2bn from £6.9bn in 2011.



· Operating profit (after modernisation costs) increased to £23m from a loss of £120m in 2011.



· Letters mail volumes were down 6% (5% in 2011); domestic parcels volumes increased 6%; Parcelforce Worldwide volumes increased 5%.



· UKPIL revenues consist of 49% parcels, 36% letters and other mail and 15% marketing mail.











Post Office Ltd (POL)



· On 1 April 2012 the structure of the Royal Mail changed. POL went from being under the ownership of Royal Mail Group to being a sister company to the Group, under the umbrella of Royal Mail Holdings. This is therefore the last year that POL’s finances will be reported as part of the Royal Mail Group.



· POL’s revenue increased to £801m from £776m in 2011.



· Operating profit (after modernisation costs) increased to £59m from £21m in 2011.



· The main driver of this growth is an increase in the Network Subsidy Payment from government which increased by £30m to £180m per year. Growth in identity related work, lottery, retail and personal financial services was more than offset by the decline in traditional products and telephony.





General Logistics Systems (GLS)



· Revenue increased by 5% to £1,562m from £1,485m the previous year.



· Operating profit (after modernisation costs) increased by 8.5% to £128m from £118m in 2011.



· Revenue growth was driven by volume growth. Parcel volumes increased by 3% in total.





Royal Mail’s statement of its financial results is available here. The full report and accounts will be available on the Royal Mail websitelater today.

CWU welcomes ‘good news’ from Royal Mail





CWU today said that Royal Mail’s improved financial results were “good news for the industry, the public and the workers who serve them.”



The figures, which were released earlier today, indicate increased revenue and rising operating profits, and, although letter volumes have declined, delivery of parcels and packets each increased by equivalent percentage levels.



The union said that this proved once again that a publicly owned postal service can be both sustainable and successful.



CWU deputy general secretary Dave Ward said: “The recent settlement of the pension scheme funding situation has been a major factor, reflecting the success of our campaign.”



Dave Ward added that the news proved that workers were “adapting well to some difficult and challenging changes in the industry.



“This industry has faced unprecedented change over the last few years and it’s our front-line members who’ve borne the brunt of this,” he explained.



“But they’ve responded well and, in spite of all the doom and gloom predictions of the death of this sector, there are now some encouraging signs.



“However, our nation’s universal postal service remains at risk from the cherry-picking by some of the sector’s private operators – and we must remain vigilant to this,” Dave warned.



The annual report, which was released by the company today, show Group revenue up by 4 per cent to £9.5 billion from £9.2bn in 2011 and operating profit (after modernisation costs) at £211 million from £39m in 2011.



New industry regulator Ofcom’s recent changes to the regulation of postal services and the subsequent stamp price rises announced by Royal Mail took effect from the beginning of April and their impact on Royal Mail’s finances will be seen in next year’s annual report and accounts.

[fishtank]

Why do we need an LTB that just parrots Royal Mail's position?

[pinstripe]

Has any office had any changes made due to the 6% INCREASE in packets?

Have any offices been forced to add extra duties to cope with this growth?

[bensonhedge]

Has any office had any changes made due to the 6% INCREASE in packets?

Have any offices been forced to add extra duties to cope with this growth?