Royal Mail is now named International Distributions Services
That's what the headlines read tonight, but the detail is somewhat different. As yet there is no press release on the Royal Mail `group website but reading between the lines in the financial and investment press, this is what I have gleaned.
Royal Mail PLC on Tuesday confirmed its name has changed to International Distributions Services PLC. This was first reported by the Financial Times on 20 July, but takes effect from today.
The company said the change has now taken effect.
In July, Royal Mail Group said the move would reflect the importance of its GLS distribution unit, which the company said it has become ‘increasingly’ reliant on.
‘The board has always maintained that there should be no cross subsidy in the group and recognises the need to address improvements in Royal Mail's performance quickly. In the event that significant change within Royal Mail is not achieved, the board will consider all options to protect the value and prospects of the group, including separation of the two companies,’ the company said in July.
GLS reported revenue growth during the first quarter ended June, while the eponymous Royal Mail unit saw a double-digit decline.
It is that sort of underperformance which may prompt the parent to mull a separation.
The Royal Mail division is its UK-focused one, delivering letters and parcels, and includes Parcelforce Worldwide.
GLS* is its international operation, based in Oude Meer, Netherlands and working across the US, Canada and Europe.
UPDATE 13 November 2022 The Royal Mail Group website address has changed to https://www.internationaldistributionsservices.com/en - unfortunately this is currently not working leading to broken links on other websites in the group.
Wikipedia:
* General Logistics Systems B.V., also known as GLS, is a British-owned logistics company based in Amsterdam, Netherlands. The company was known as German Parcel when it was founded in 1989, by Rico Back §. It was subsequently rebranded as GLS and is now a subsidiary of Royal Mail
§ Rico Back (born 1954) is a German businessman. He is a founding member and former CEO of German Parcel (now GLS Group). He was also the CEO of Royal Mail from 2018 to May 2020 until he resigned after annual revenues to April 2020 fell £22 million year on year.
Comments
"Royal Mail has been rocked by employee strikes and things are only going to get worse given the timetable for further picket lines throughout October and November.
"It’s no wonder the group is desperate for the market to understand there is more to its business than simply delivering letters and parcels in the UK.
“'Its overseas arm GLS has become increasingly important to the
group’s earnings and that’s why the corporate name has changed to
International Distributions Services, in the hope that people will stop
thinking of the business simply as a fleet of red vans and workers in
shorts pushing energy bills through doors. It’s not the snappiest of
names and one wonders if Irregular Delivery Services might have been a
more appropriate moniker,' said AJ Bell’s Russ Mould." (London Loves Business)
As this affects only the holding company I expect it to have absolutely no effect on the UK letters and parcels businesses nor on stamps etc.
Better than Consignia , and will deflect attention from their worst asset Royal Mail . Just a shame they won't change the people that run it
ReplyDeleteA "separation of the two companies" might conceivably crystalise a threat (real or implied) that Royal Mail will be 'allowed to fail' - perhaps to force His Majesty's Government either to renationalise the loss-maker or to provide some sort of subsidy in order to retain a UK-wide tariff.
ReplyDeleteIt will almost certainly be 'allowed to fail'. I very much doubt that the government will step in in any way and we may see the end of the Royal Mail entirely.
ReplyDeleteWhat is more likely is that there will be separate companies, within the group, and IDS may decide to rid themselves of the loss making RM by selling it.
DeleteAs a separate company, it would have a lower market capitalisation and it could well be bought by a rich European. Kretinsky (West Ham United, J Sainsbury, etc) already has 22% of RM, and slightly more of PostNL the Dutch operator.
On the other hand, if the company was likely to fail it could be ripe for renationalisation. Whilst the Conservatives are normally against nationalisation, there are banking and railway precedents, and a future Labour government would have far fewer qualms.
Food for thought.
I have found it's not worth Collecting Used Royal Mail Stamps as their Mail Centre's are making it difficult by continuing to destroy stamps with a pen in the last few months I have had 15 Envelopes with nice British Stamps dating back over the last 10 years or so and every one has been Stuck with a Pen
ReplyDeleteI have complained to the Royal Mail HQ in London and all they say is that is what they have to do because they don't want to lost Revenue! but if they
Postmarked them by Hand or Machine in the first place they would not lose any Revenue, RW
"Postmarked them by Hand or Machine in the first place they would not lose any Revenue" but postmarked by Hand means an adequate number of Mail Centre staff employed on handstamping duties and by Machine means investing in ones that are more efficient and neither are likely even if they would be cost effective.
ReplyDeleteOn speaking to my postman today he informed me of new instructions on the delivery of items which had come from his manager. Parcels were to be delivered every day, but normal mail will be delivered every 3rd day. So, in essence 2 deliveries a week in my part of London
ReplyDeleteThat contravenes the Universal Service Obligation.
ReplyDeleteAre Royal Mail headquarters aware of that manager's instruction ?