royal mail profits

[GUVI]

have been announced on rms website.
could some one work it out but to me looks like if it weren,t for the pension deficit they had to pay
we would probably have even made more than last year.nearly 200 million went into pensions.

[jemima]

"The cost of servicing the Company’s pension plans rose steeply in 2006-07 by £193m to £722m and accounted for the bulk of the drop in the Group’s profit."

(from http://www.royalmailgroup.com/portal/rm ... d=63500720)

So the total payment into the pension fund was £722m.

But you need to view that cost as part of the total "people costs". Including wages and the pension fund cost, they were £4,159 last year. I don't have the total for this year. Paying an extra £193m into the pension fund represents only an additional 5% of people costs and is no big deal. It should be affordable.

But yes, there would have been £193m more in profits, which would have been £426m, if they hadn't paid it. I'm glad they did because I think that maintaining decent pensions for employees is more important than large operating profits, in the public service sector.

[mdtomuk]

AHA! WERENT WE TOLD AROUND APRIL/MAY TIME THAT WE WERE RUNNING AT LOSS AND WE SHOULDN'T HAVE ANY PAY RISE AT ALL?

OH, AND WHAT KIND OF BUSINESS BORROWS £75M AND ADDS IT TO THE PROFITS!

[BELIAL]

So despite increasing management bonuses, pension contributions; falling mail volumes and losing 40% to downstream access ,profits are up .

Who earned those profits?

[evilc]

Perhaps it has gone here

Allan Leighton, Royal Mail's chairman, yesterday defended a £469,000 bonus awarded to the chief executive, Adam Crozier, for the last financial year in which the company produced record quality of service levels but saw profits fall by a third.
Mr Crozier deferred £257,000 of his bonus payment but the balance of £212,000, plus his basic salary of £633,000, and benefits took his pay for the year to £859,000. Adding back the deferred element would take Mr Crozier's remuneration to more than £1.1m. Overall, the Royal Mail board was awarded £1.5m in bonuses, up from £1m the previous year.


Article continues

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Mr Leighton was robust in his response to questions about Mr Crozier's remuneration. "The reason Adam gets paid what he gets paid is because he runs a bloody big company and does a great job. Getting good people to run this company is difficult. I'm very pleased we've got him."
Over the summer Royal Mail was involved in a bitter dispute with the Communications Workers Union over pay, pensions and working practices.

Yesterday the CWU's deputy general secretary, Dave Ward, attacked Mr Crozier's salary package. "Postal workers have had to take eight days of strike action this year to get any pay rise at all, while the chief executive receives £1m. It's time to review pay at the top of the business."

Royal Mail said the key reason behind the fall in profits was a £193m increase in pension fund costs to £722m. If the £75m from the government's social network payment, which subsidises the rural postal system, was stripped out, underlying profits fell to £158m.

The company puts the immediate cost of the strike at about £10m in lost revenue but acknowledges the real cost will only emerge in coming months as it assesses the business it has lost for the long term as customers switch to alternatives. "We let a lot of our customers down, which is not a great place to be," Mr Leighton said. "I don't think we will know the full cost until six, nine or 12 months' time."

Royal Mail is planning to order some 600 sorting machines soon as part of its modernisation programme, at a cost of £350m, with another 600 to come later.

The company warned that over the next two years it would be operating at about breakeven as a result of the continuing costs of funding the pension scheme, of the investment programme in new equipment and the inexorable decline in mail volumes. In the first five months of the financial year, which began in April, Royal Mail said revenues at the letters business fell by £78m - though that figure included the cost of the strikes.

Mr Crozier said the deal negotiated with the CWU would allow Royal Mail to modernise in the way its competitors such as Deutsche Post and TNT had done a decade ago. "We are playing catch-up and we have to do that as quickly as possible."

Royal Mail declined to be drawn on the numbers of job losses that would follow the introduction of new equipment. "There are different options we are looking at and we will be looking at them with the CWU," Mr Crozier said. "We have always tried to do things the right way and we will continue to try to do that."

Royal Mail is funding the modernisation programme using a £1.2bn debt facility, which is part of a £4bn programme backed by the government.

Mr Leighton revealed yesterday that if the company had not be able to reach a deal with the CWU that gave it the flexibility it required then it would not have taken on the debt. "This business has a history of spending money on lost causes. We are not in that game."

[jafferpants]

Have you noticed how they keep on&on about the pension being their main problem. look closely the clues are there. It's called letting you down gently.

[Jimi]

Let me get my head round this

Group Profits £233 m down by £122 m from £355 m

Extra cost of servicing existing Group pension £193 m up to £722 m

Which would mean the group had made an extra £71 m which was offset against the pension increase, as it only showed a £122 m Loss?

Repayments to the pension fund of around £800m to pay off the deficit they have caused by the pension holiday they enjoyed in the past.

Group Profits £233 m and extra pension repayments of £800 m = £1,033 m

Which means that we the workers have made £1,033m for them to spend £800m to pay for their past mistakes

[GUVI]

as stated by a.l. 350 million to be spent on new sorting machinery this year and 350 million nxt year
add to that the cost of sustaining pension deficit.now ring a bell here how the f**k are you supposed
to get your share in business profits ( a.l. says no profits for 2 years ) as per agreement.???????????
any answers please cos our supposed shares are going to be worth 0 nil NOTHING zilch/
WAKEN UP EVERY ONE RATS DONT SMELL THIS BAD
VOTE SENSIBLY NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO

[F0zziebear]

I don't understand how you seem to think you have made £1bn for Royal Mail. Unless you are in Sales or Marketing, you are providing a service to deliver on promises made to customers. None of us (when I was working there) actually sold any products to customers.

It's like people working in the car industry. We brought them loads of profits. No you didn't you did a job assembling a car. The sales people sold the cars and the marketing people marketed the cars. It is common sense.

Also the so called £800m 'they' spent on past mistakes was made by people during the 1990s and early 2000s. I think you'll find it was Leighton and Crozier was dumped the Consignia idea, and shed the various third rate postal businesses Royal Mail bought overseas.

Not sure Crozier can justify his current salary even on the basis of being a FTSE100 type company. However, you should be bringing in former directors of Royal Mail to find out why whilst taking a pension holiday they made so many abysmal investments on behlaf of the pension fund, i.e. you the worker who paid into it.

I don't have any particular affinity to Crozier and Leighton, but blaming them for things that happened prior to their arrival is unfair. I don't see you blaming Blair and Brown for privatising the mines etc... but then they have enough problems under their own stewardship to explain, and possibly so does Crozier and Leighton.

F0zz

[TrueBlueTerrier]

Hadn`t they also wasted 63million on *management consultants*?

This apparently was on the radio this morning...

If they have spent that money, wouldn`t it have simply been cheaper to sack the pillocks now in charge and get some managers in that CAN do they job, because that money just goes to show they can`t do the job they are overly payed to do at present..

http://www.telegraph.co.uk/news/main.jh ... ult131.xml

Consultants are being paid more than £300 an hour to advise the Government on how to shut more than 2,000 post offices, ministers have admitted.

The disclosure infuriated opposition parties who said it was a "total disgrace" that ministers were spending hundreds of pounds an hour on the controversial closure plan.

Unions said the consultants were paid 44 times more than the £7.24 hourly rate handed out to the highest paid customer service adviser in the Post Office.

The Government confirmed in May that around 2,500 post offices will be axed over the next 18 months, cutting the total from 14,300 to about 11,800.

Pat McFadden, a minister in the Department for Business, Enterprise and Regulatory Reform, yesterday confirmed that consultants who advised on the closure plan were paid a "combined average hourly rate" of £318 an hour.

Mr McFadden refused to provide a breakdown of hourly rates paid to individual advisers because it was "commercially confidential information".

Lembit Öpik, the Liberal Democrats' shadow business, enterprise and regulatory reform spokesman, said: "Wasting this much money on consultants while ministers are masterminding the closure of thousands of post offices is a total disgrace.

''Millions of pounds of taxpayers money could be being thrown down the drain.

"Rather than wasting time and money on its sticking plaster solution to the Post Office's problems, ministers should instead work towards putting the business on a genuinely sustainable footing."

Postal unions were outraged. Andy Furey, an official at the Communication Workers Union, said it was "disgracefully unfair" that postal workers were facing a pay freeze when the Government "wasted" vast sums of money on advisers and consultants.

[swashy]

Fozzibear makes some good comments and there is no doubt that many bad decisions were made in the past. My problem with the present regime is that they are media savvy businessmen who perpertrate a lie. You must first understand what motivates rich men and that is getting richer or the fear of becoming poor. Not poor in the sense that you and I know but poor nevertheless.
Crozier's wages for failure pale in comparison to some others presently in the spotlight but you have to remember that this is public money. He tells us that we must accept a raid on our pensions whilst at the same time he gets £140,000 in lieu of pension payment. He receives this because his pension is fully stacked, under government rules he cannot put any more money into his diamond encrusted pension scheme.
He tells us we are overpaid and underworked. 1.1 million pounds he received this year and for what. Did he bring in new business? Did his inspirational leadership avoid a costly strike? Did he take the Royal Mail brand into the heart of europe? Did he take on the government and demand that they lift the restrictions that continue to cost us?
He did none of the above because like Mr Leighton they are merely pawns in a government orchestrated ruse. Self serving sycophants whose only loyalty is to their own ambition and bank balance.
Their latest ploy was actually the strike. This strike was not only anticipated but planned for and it serves the needs of messr's Leighton and Crozier. They struck a deal with Postcomm' that if the strike could be attributed to their plans for modernisation then no penalties would be forthcoming. What you see as chaos in the postal network during the strikes they see as profit. Not just for the company but also personally. Despite the interim figures I can't wait to see the end of year accounts particuarly director remuneration. Like I said fozzi you make some good comments.

[Jimi]

I don't understand how you seem to think you have made £1bn for Royal Mail. Unless you are in Sales or Marketing, you are providing a service to deliver on promises made to customers. None of us (when I was working there) actually sold any products to customers.

It's like people working in the car industry. We brought them loads of profits. No you didn't you did a job assembling a car. The sales people sold the cars and the marketing people marketed the cars. It is common sense.

Also the so called £800m 'they' spent on past mistakes was made by people during the 1990s and early 2000s. I think you'll find it was Leighton and Crozier was dumped the Consignia idea, and shed the various third rate postal businesses Royal Mail bought overseas.

Not sure Crozier can justify his current salary even on the basis of being a FTSE100 type company. However, you should be bringing in former directors of Royal Mail to find out why whilst taking a pension holiday they made so many abysmal investments on behlaf of the pension fund, i.e. you the worker who paid into it.

I don't have any particular affinity to Crozier and Leighton, but blaming them for things that happened prior to their arrival is unfair. I don't see you blaming Blair and Brown for privatising the mines etc... but then they have enough problems under their own stewardship to explain, and possibly so does Crozier and Leighton.

F0zz

When I said we I meant it in the larger sense all the people at the sharp end of the stick, Parcelforce, Romec, Counters, and all the fine people in sales and marketing, all the people who are now getting shafted by the company and the Government both past and present.

I don’t remember naming any person in my post as being the source of the Group pension deficit, and certainly not Leighton and Crozier, I was blaming the Post Office Group for the mismanagement of the Group pension.

And I do agree with you it was Leighton and Crozier who dumped the Consignia idea, and shed the various third rate postal businesses Royal Mail bought overseas.

But they are the same people who just tried to shed £1.6 billion of pension liability, by having the very people who have paid into the scheme over the years without the benefit of a pension holiday, suffer with reduced pension benefits.

[TrueBlueTerrier]

http://www.thesun.co.uk/sol/homepage/ne ... 417184.ece

THE number of letters sent by Britons has started to drop for the first time, ROYAL MAIL revealed yesterday.

The postal operator said mail volumes fell 2.3 per cent in 2006-07.

Chairman Allan Leighton, speaking as Royal Mail reported a 34 per cent drop in annual profits to �233million, said it was the first decline after many years of growth — and had not been expected.

He added: �The growth in email undoubtedly was a key factor and the realistic prospect is for further volume decline. The peak in mail volumes looks likely to be behind us.�

Mr Leighton said that from April to August revenues in Royal Mail’s letters business were down �78million on last year — despite a price rise in April.

The fall in annual profits does not include the impact of this summer’s strikes, but was due to Royal Mail paying an extra �193million to its pension fund, which has a �5billion deficit.

Mr Leighton said that, had a �75million payment from the Government to support loss-making Post Office branches not been included, the drop would have been greater. He warned Royal Mail would probably only break even this year and next. Chief executive Adam Crozier said competitors were eating into Royal Mail’s market share more aggressively than had been assumed.

He added: �We expect that rivals will this year be handling around four billion letters — around one in every five posted. This was a level our regulator Postcomm had forecast would not be reached until 2010.�

Mr Leighton said the figures showed the urgent need to modernise Royal Mail — the issue at the heart of the strikes.

He said: �The UK postal market has changed for ever and Royal Mail Letters’ choice is to modernise or face stagnation and decline.�

[moanmoanmoan]

http://www.thesun.co.uk/sol/homepage/ne ... 417184.ece

THE number of letters sent by Britons has started to drop for the first time, ROYAL MAIL revealed yesterday.

The postal operator said mail volumes fell 2.3 per cent in 2006-07.

Chairman Allan Leighton, speaking as Royal Mail reported a 34 per cent drop in annual profits to �233million, said it was the first decline after many years of growth — and had not been expected.

He added: �The growth in email undoubtedly was a key factor and the realistic prospect is for further volume decline. The peak in mail volumes looks likely to be behind us.�
Mr Leighton said that from April to August revenues in Royal Mail’s letters business were down �78million on last year — despite a price rise in April.

The fall in annual profits does not include the impact of this summer’s strikes, but was due to Royal Mail paying an extra �193million to its pension fund, which has a �5billion deficit.

Mr Leighton said that, had a �75million payment from the Government to support loss-making Post Office branches not been included, the drop would have been greater. He warned Royal Mail would probably only break even this year and next. Chief executive Adam Crozier said competitors were eating into Royal Mail’s market share more aggressively than had been assumed.

He added: �We expect that rivals will this year be handling around four billion letters — around one in every five posted. This was a level our regulator Postcomm had forecast would not be reached until 2010.�

Mr Leighton said the figures showed the urgent need to modernise Royal Mail — the issue at the heart of the strikes.

He said: �The UK postal market has changed for ever and Royal Mail Letters’ choice is to modernise or face stagnation and decline.�

This man is paid how much?

Has he not considered that email may have an impact on post volumes?

He is telling RM staff that they need to modernise - and obviously has been oblivious to the internet boom in the last 10 years.

I would suggest that modernisation within RM should also include a chairman who has heard of the f*****g internet!!

[k979aaa]

volumes read royalmail revenue's read cheep downstream access price read crap negotiator :cfo read crap chairman :lfo read crap regulator POSTCOMM read crap minister for buisness and regultory reform (JOHN HUTTON) read shite prime minister (GORDON BROWN) THE BUCK STOPS HERE!.