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* Royal Mail cannot rule out reducing services
* Fall in volume of advertising mail
* Parcels business volume increases
* HSBC, BBC have also delayed restructuring plans
(Updates with context, share price, quote)
By Muvija M
March 27 (Reuters) - Britain's Royal Mail on Friday
became the latest company to say the coronavirus had delayed
plans for a radical turnaround and also cancelled its dividend
and suspended financial forecasts for the next year.
The former monopoly and one of the world's oldest postal
companies last May pledged to invest 1.8 billion pounds ($2.19
billion) to transform itself into a sustainable, profitable
operation by 2024. It has since been locked in negotiations with
its labour union.
"Uncertainty around the length and impact of the COVID-19
pandemic, means we now believe it will take longer than expected
to achieve the targets laid out in our Journey 2024 plan," the
company said in a statement.
It was too early to predict accurately the financial impact
from the virus-related disruptions, but it said it expected its
British business to be loss-making in the financial year 2020-21
and business-to-business volumes to continue to decline.
Shares in Royal Mail were down 8.4% at 148 pence by 1003
GMT.
The company, which provides letter and parcel deliveries to
more than 30 million businesses and households, said it cannot
rule out scaling back its services as the situation develops.
It also said volumes of advertising mail had fallen heavily
since the outbreak and its international operations have seen
lower volumes following restrictions in many countries,
especially China, where the coronavirus began in December.
Its parcels business, however, has experienced increased
activity over the last two weeks, as more people shop online to
avoid public spaces because of their fear of infection.
The Royal Mail's announcement follows similar news from
other major companies.
The banking group HSBC is delaying the "vast
majority" of its planned redundancies to deal with the fallout
from the coronavirus, a memo to staff seen by Reuters said.
Britain's BBC has also suspended plans to cut 450 jobs as it
faces the demands of delivering news on the outbreak.
Following guidance from the Financial Conduct Authority and
Financial Reporting Council to British companies, the Royal Mail
said it will postpone its fiscal 2019-20 results, which had been
scheduled for May 21.
The company has more than 800 million pounds ($973.76
million) in cash as well as a 925 million pounds credit
facility.
($1 = 0.8205 pounds)
(Reporting by Muvija M in Bengaluru; editing by Patrick Graham,
Shounak Dasgupta and Barbara Lewis)
