While the change in the leadership at the U.S. Postal Service was planned, it was announced today by Royal Mail Group that its chief executive Rico Back will step down immediately.
Back steps down after less than two years leading U.K.’s postal service through tumultuous labor disputes and questions about the mail service’s operational response due to the COVID-19 crisis.
Keith Williams, a former chief executive of British Airways, becomes interim Executive Chair of Royal Mail Group, and Stuart Simpson becomes interim CEO of Royal Mail (UKPIL).
Royal Mail Group Trading Update
The Royal Mail Group also announced an update on its operational and financial position.
Performance, current trading (Monday 30 March 2020 to Sunday 3 May 2020) and financial position:
- Year on year UKPIL revenue down £22 million in April.
- Substantial switch from letters to parcels in the U.K. U.K. parcels volume up 31 percent and revenue up 20 percent.
- 308 million fewer addressed letters (down 33 percent). Letter revenue down 23 percent, offset, in part, by 36 million more parcels.
- UKPIL costs up £40 million, driven by overtime and agency resource costs due to high levels of absence, the introduction of social distancing measures and PPE.
- The GLS situation is still evolving. Shift from B2B to B2C parcels across all markets in the U.K. and overseas.
- Significant volatility in parcel volumes as COVID-19 pandemic has developed across key markets.
- The liquidity position remains strong—total liquidity (including undrawn facilities) around £1.8 billion. The Group has the ability to access the COVID Corporate Financing Facility (CCFF) if required.
A leadership change in the middle of a crisis is never good. However, considering the many problems, especially labor issues Royal Mail Group has been facing, maybe this will bring back some hope and unity within the labor force as postal services around the world have become the lifeline to many people stuck at home due to the coronavirus crisis.
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