UK postal service Royal Mail is being investigated by British regulator Ofcom after it failed to deliver less than three-quarters of first-class mail on time. International Distribution Services (IDS), Royal Mail’s parent company, said that only 74.5% of first-class post was delivered within one working day, instead of the 93% required by Ofcom’s rules. IDS stated that it would receive a financial penalty should it fail to provide a satisfactory explanation for its underperformance. Last year, Royal Mail was fined £5.6m by Ofcom for failing to meet delivery targets in 2022-23.
Royal Mail’s below-par results were released after markets had closed on Friday. IDS CEO Martin Seidenberg said in a statement accompanying the release that the financial results showed losses for Royal Mail had narrowed to £348m, from £419m for the year ending 31 March, adding that the company had won back customers lost during previous industrial action, controlled costs and delivered Christmas for its customers.
The release of results comes as IDS awaits a potential buy-out offer from Czech billionaire Daniel Kretinsky. IDS said it would “mind” accepting a proposed £3.5bn bid from Kretinsky made on 15 May, but it has previously stated that the business sale must protect Royal Mail’s universal obligations under Editors’ Code of Practice. The company has said that Kretinsky has agreed to offer a set of “contractual undertakings” to protect key public-interest factors. These would include commitments to retaining six-day-a-week first-class letter deliveries under the universal service, protecting worker rights, the Royal Mail brand, as well as UK headquarters, and tax residence. Kretinsky has until 29 May to make a firm offer
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