UK postal operator Royal Mail revealed Thursday that it took a vast £200-million ($247 million) hit from recent strikes over pay, deepening the group’s losses.
Operating losses hit £295 million in the nine months to December from a year earlier, parent International Distributions Services (IDS) said in a results statement.
Royal Mail’s revenue tumbled 12.8 percent.
The group was blighted in the period by 18 days of staff walkouts, but claimed some 12,500 union members worked regardless.
Strikes have multiplied across Britain as workers protest over wages that have failed to keep pace with decades-high inflation.
At the same time, Royal Mail’s core letters business has been ravaged for years as consumers increasingly go online to communicate.
Its performance has been further slammed by the worsening UK economic climate.
Royal Mail had enjoyed strong demand for parcel deliveries during UK pandemic lockdowns — and also for test kits and protective clothing — but the Covid-era boom tailed off.
“Performance continues to be driven by a return to structural decline in letters, weaker retail trends, the impact of industrial disruption and lower test kit volumes,” IDS said Thursday.
Nevertheless, Royal Mail remains on course to meet its guidance for an annual operating loss of between £350 million and £450 million.
This outlook was unchanged “due to tight control of costs and strike contingency measures”, but assumes no further walkouts in the fourth quarter, it said.
But more strikes could spark more hefty write-downs.
Royal Mail’s owner is restructuring in a bid to stabilise its finances.
The group unveiled plans in October to axe up to 10,000 jobs in a wide-ranging overhaul.
IDS said Thursday its job-slashing plans remain on track, but added that it expects “significantly” fewer voluntary redundancies.
The company recently resumed talks with the Communication Workers Union. However, the CWU this week launched a ballot for more industrial action.