POSTAL GIANT BLAMES STRIKE ACTION

ROYAL Mail used the cover of industrial action to warn that its UK business could be tipped into the red next year.

The postal giant claimed an ongoing dispute would slow its “rate of change” and dent productivity.

The firm also said it was braced for a worse-than-feared 6-8 per cent slump in letter deliveries in its next financial year. The result could “possibly result in a break-even or lossmaking situation” for its UK business, it said. Boss Rico

Back The warning comes just a week after Royal Mail secured an injunction to block postal workers from taking part in strike action.

Nearly £330million was wiped off Royal Mail’s stock market value yesterday as its shares tumbled more than 14 per cent.

That was despite Royal Mail hailing its best UK sales performance for the “past five years”. The delivery giant saw revenues rise 5.1 per cent to £5.16billion in the half-year to September 29 as profits soared from £33m to £173m. Parcel revenues more than offset the decline in the letters arm. Group boss Rico Back said: “The challenging financial outlook in the UK means now more than ever before we need to make the changes required – and accelerate them – to ensure a successful UK business.”

The results came on the same day Labour published its manifesto, including a pledge to renationalise the postal group.

And Russ Mould, investment director at City stockbroking firm AJ Bell, said: “Rico Back’s outlook for the year to March 2021 has sent investors running for cover faster than a postman chased by an angry dog.”