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© Reuters. FILE PHOTO: A Royal Mail postal worker stands in the yard of a sorting office in Altrincham,
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(Reuters) – Royal Mail (L:) said on Friday its heavily disputed turnaround program would take longer than previously planned as it cancelled its dividend and suspended financial forecasts for the next year due to the coronavirus crisis.
The former UK postal monopoly said advertising mail had fallen heavily due to the virus outbreak, while its international operations have also seen lower volumes due to restrictions in some countries, mainly China.
It also added, however, that its parcel business has seen strong volumes over the last two weeks, as more people shop online to avoid public spaces due to the fear of infection.
The company, which has been locked in negotiations with its labour union over direction, national agreements and workplace culture, last May pledged to invest 1.8 billion pounds in a plan to transform into a sustainable profitable operation by 2024.
Royal Mail said it was too early to accurately predict a monetary impact from the virus-related disruptions, but expects its UK business to be loss-making in fiscal 2020-21 and business-to-business volumes to continue to decline.
Following guidance from the Financial Conduct Authority and Financial Reporting Council to British companies, Royal Mail said it will put off its fiscal 2019-20 results, which was earlier scheduled for May 21.
The company, one of the world’s oldest postal services, currently has more than 800 million pounds in cash as well as a 925 million pounds credit facility.
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