London, England, United Kingdom (AHN) – The Royal Mail reported Tuesday a $99 million (66 million pounds) loss due to a five percent drop in mails from April to September.
It is the first significant loss on letter delivery for the Royal Mail in eight years.
Royal Mail Chief Executive Moya Greene, who was hired from Canada Post to turnaround the agency’s finances, explained the loss to people opting to use emails and other forms of communications instead of regular mail. Greene added that regulations require the Royal Mail to deliver at a loss bulk mail such as bank statements, energy bills and marketing materials.
Greene warned that more losses may likely take place as Royal Mail anticipates a 40 percent reduction in mail volume in the next five years.
Prior to the loss report, Royal Mail wrote in mid-October to regulator Postcomm to request for authority to raise charges on bulk mail sent by businesses to prevent the agency from running out of cash. The proposed seven percent rate increase would raise about $150 million (100 million pounds) a year.
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November 3rd, 2010
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