Member Info for OliGarch

Talk2Much, "Even when you don't have a letter for a household, you're still covering most of the ground except the trip to the letterbox. This is part of the reason RM struggle to reduce costs even when volumes fall. The people costs are a huge proportion of RM outgoings".

Thank you for clarifying my earlier point.

So, on this basis, should the business announce a further 10,000 FTE job losses to cut staff costs?.......lol

AngerSharkz, the report mentions "quality of service" twenty one times but the only reference to the method of solving the issue seems to be.....

"Revisions are now completed in all processing and delivery units to align resource to workload. Equalising workload and improving productivity will allow us to improve quality of service for both letters and parcels" which is obviously not happening effectively otherwise there wouldn't be a need for the union to call for a Zoom meeting?

I'm reading "more delaying tactics" into this statement.

"restoring quality and USO compliance"....

How much is that going to cost the business?

UPDATE FOR ROYAL MAIL GROUP MEMBERS

The Communications Union

9th June 2023

Negotiations on quality of service/USO, failed revisions, a joint Zoom meeting for every CWU rep and manager in the UK and other outstanding issues have continued and progress has been made.

We hope to share full and finalised details next week and will be communicating as extensively as possible at that point.

We fully understand the pressures locally. This is what has driven us to commit the company to restoring quality and USO compliance and improve the local office environment.

Newdealz, how's the candelabra pattern going?

I hear that if you unscrew the wrong bolts fro above then the whole thing comes crashing down?

Albert........get the van......

AngerSharkz, "Yes……they have been making forecasts and working out the margins for years…..certainly the last few years while I’ve been invested….they’ve been forecasting horrendous numbers and every time they are correct. Volumes are decreasing, as are margins as is the bottom line."

So, who is going to correct this situation then? Clearly the BoD are unable to manage/change the situation and obviously something has to give?

AngerSharkz, I think that you have misunderstood what I am trying to say here and I have no reason to doubt your sources however the parameters of the current USO obligation are laid out and known (just like the rules of chess). The number of households are known (albeit increasing year on year). The maximum amount of ground that an average postie can cover in any part of the country during a shift of just over seven hours is known. The overheads and volumes are known (RM have been collecting this data and forecasting it for many years) so it shouldn't be rocket science to work out how much revenue needs to be generated in order to turn a 5% profit? Don't forget that those on the top table are rewarded handsomely for knowing this and getting it right.

So if the price of a 1C stamp needs to increase to £2 and 2C to £1.50 then that's what it is?

As the USO and RM postal delivery seems to be a Marmite topic for quite a lot of the articles that are online and it also has the potential to affect every household in the UK then perhaps the UK Government should hold a referendum on reducing the USO? Winner takes all? Just a thought....

Derek, so what you are are saying is that despite putting the price of a 1C and 2C stamp up by 10% in April that there's still no profit to be made? I realise that DSA comes in much cheaper for bulk posters and account holders but surely it's not rocket science to work out the overheads required to meet the USO obligation and the projected volumes involved in order to get a handle on the situation.

Of course there will be some who will lay the problem on the 2022 strikes and the militant workforce but that's so last year and has already been priced in? We need to see how the 2023 data for Q1 is panning out? If it's still an abject failure then the UK operation needs a complete refresh on the top table?

Scamp, "Only one thing matters here...

and its all contained within this latest rns".

I think that you will find that they issue a similar RNS whenever VESA buy a large amount of shares in one hit?

"its the only game in town...and has been that way for the last several years".

This sounds like a cry for help? Have you tried First Class Support?

Here's the kicker.

We have been told that the USO has been a loss maker for the UK operation for several years and none of our chairman have been able to successfully challenge OFCOM.

Why is this?

Figures have been bandied about in the region of £125 to £225m per annum which is not insignificant. This type of saving could have been spent on reinvestment or CEO/COO/CFO bonuses or World Class Mail or shareholder dividends so why hasn't the Chairman been more vocal?

Perhaps there's more to politics than meets the eye?......lol

Newdealz, wouldn't it be in the best interests of VESA to buy another one percentage at this point in order to reassure others investors and deter shorters plus the other added advantage of lowering their risk?

Of course, this may inflate the SP in the short term and allow some investors to get out relatively unscathed.

AngerSharkz, "OFCOM haven’t issued their report yet so until then it’s probably pointless speculating".

And thereby stands one obstacle. It takes them seemingly forever to issue fines so issuing a report of this magnitude could be a lengthy wait?

JB, AngerSharkz, say that OFCOM have already decided to debate and potentially change the USO provision. How long would you envisage it would take before the new Act comes into effect bearing in mind all of the Parliamentary processes, hearings and committes involved?

JB, the response from OFCOM is on pages seven and eight of the pdf document. It was written by Ian Strawhorne, Director, Enforcement on the 15 May 2023 so probably hasn't changed in the last three weeks?

Not sure where the figure of £125m to £225m comes from but Thompson was definitely spouting the higher figure this time last year.

Newdealz, perhaps VESA upping their stake is the way to go. There were plenty of posts on here last summer stating that if VESA bought out IDS lock, stock and barrel then the USO would be changed straight away.

For a business that has been constantly whinging about it's finances you would think that having the regulator telling it that it needs to maintain its obligations and thus having to spend more cash servicing those obligations would be seen as a bit of a negative?

Yes, MaryBr190, I now fully expect a +30% increase in the SP next week.......lol

JB, in that case, I'm not sure what that nonsense on the official UK Government website is even doing there?

Probably best to ignore it and maybe it will go away?

Newdealz, "Its the algo, thats a good sign we are on an up move, get ready"

I'd like to share your enthusiasm fella but with today's news on the USO then I would have to disagree....or perhaps you meant that comment for another stock?

"ofcom has estimated that cutting saturday letter deliveries would save royal mail up to £225m per year".

so, back of a *** packet that's £600k a day or £4.3m per week to find out of the coffers which is quite a bit for an already materially loss making business, so where's the money coming from? don't forget that there's potentially another £250m to be found if the 6% pay increase is voted through and that's year on year plus it looks as though the uso isn't going to be looked at again until 2025 or beyond?

it looks as though the bod has spectacularly failed with their approach and ended up shafting shareholders, staff and customers alike.

i would guess that the best option for the uk operation is to plough on with "plan a" and take the annual ofcom fines on the chin? surely they can't find rm more than £225m a year? what's the worst that can happen.

Clearly not rehashed news then....

https://www.theguardian.com/business/2023/jun/08/uk-government-reject-royal-mail-request-end-saturday-deliveries

https://committees.parliament.uk/committee/365/business-and-trade-committee/news/195563/no-change-to-six-days-letter-service-government-confirms-in-response-to-business-committee/

Not sure if this is old news rehashed?

https://www.lse.co.uk/news/IDS/uk-govt-rejects-royal-mail-move-to-axe-saturday-deliveries-ljqk6rwj5tx1vh4.html