Royal Mail Q3 Revenues Down, FY Trading In Line With View; To Cut 700 Jobs; Stock Up
(RTTNews) - Royal Mail Plc (RMG.L), a Postal service and courier company, Tuesday said its third-quarter performance has been in line with expectations. Revenues declined from last year, but grew from pre-pandemic 2019.
Looking ahead for the year 2022, the company said its trading is in line with previous guidance of around 500 million pounds adjusted operating profit. Including restructuring charge, guidance is now around 430 million pounds adjusted operating profit.
Royal Mail said there is still some uncertainty over the evolution of the COVID-19 pandemic and current Omicron wave, consumer behaviour, and economic factors such as GDP growth and inflation.
As part of plans to further simplify and streamline operational structures, the company said it is engaging with unions on the proposals, which would lead to a reduction of around 700 managers and deliver an annualised benefit of around 40 million pounds, with around 30 million pounds in FY 2022-23.
Shares of Royal Mail were gaining around 5 percent in the morning trading in London.
In its trading update, the company said its third-quarter Group revenues declined 2.4 percent to 3.55 billion pounds from last year's 3.64 billion pounds. On a pre-pandemic basis, from 2019, revenues climbed 17.1 percent.
Royal mail revenues were 2.42 billion pounds, down 5.8 percent from last year, but up 9.8 percent from 2019. The domestic parcel revenue grew declined by 4.9 percent year on year. Domestic parcel volumes declined 7 percent.
International revenues declined 27.6 percent.
Revenues from GLS, however, grew 4.5 percent from last year, and 35.2 percent from 2019.
For its restructuring programme, the company expects to incur a restructuring charge of around 70 million in the fourth quarter of fiscal 2022.
Royal Mail's full-year results will be published on May 19.
In London, Royal Mail shares were trading at 458.15 pence, up 4.94 percent.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.