Royal Mail has blamed strike action for helping send it slumping to a full-year loss of more than £1 billion.
The group’s owner, International Distributions Services (IDS), revealed Royal Mail swung to an operating loss of £1.04 billion for the year to March 26, against earnings of £250 million the previous year.
On an underlying basis, Royal Mail saw operating losses of £419 million, against profits of £416 million the previous year.
IDS said the losses were largely down to crippling industrial action after it booked a £539 million writedown on the value of Royal Mail due to the impact of strikes and the “current risk backdrop”, while it took a hit of around £200 million from 18 days of strikes.
The group also revealed a cyber attack in January cost it £20 million in lost revenues after it was left unable to send international parcels and consumers and businesses faced lengthy delays.
IDS overall posted a £748 million annual operating loss, against profits of £577 million the previous year, but IDS said it was targeting a return to underlying earnings over 2023-24.
The figures come after Royal Mail last month agreed a deal with the Communication Workers Union (CWU).
But it faces further turbulence with chief executive Simon Thompson recently announcing he will step down by the end of the year and news earlier this week that Royal Mail is being investigated for failing to meet its delivery targets in the past year.
IDS chairman Keith Williams said: “We apologise to everyone for not delivering a quality of service to the standards that we expect.
“It’s been a difficult year for Royal Mail, in particular for customers and our people and shareholders.”
He added: “We are absolutely committed that we do improve our quality of service and start to deliver to customers the service that they pay for.”
It revealed on Monday that only 73.7% of first class mail was delivered within one working day across the year. The target was 93%.
He said the group is not blaming the CWU for the failures but add that “clearly the strikes didn’t help”.
He said strikes accounted for around eight percentage points of the first class target miss.
But Mr Williams added there were “grounds for optimism”, with management expecting Royal Mail to return to profit in 2024-25 following the deal with the CWU.
He insisted that Royal Mail “does have a future in the group”.
