Royal Mail is expected to post losses of almost £1m a day as its takeover by a Czech billionaire hangs in the balance.
The postal service – which is owned by International Distributions Services (IDS) – will unveil an annual loss of £313million next week, according to estimates by City analysts.
Although this is far less than the £1billion loss it posted the year before, it lays bare the crisis still engulfing Royal Mail.
IDS bosses this week said the company was ‘minded’ to accept a £3.5billion takeover offer from Daniel Kretinsky.
The Czech tycoon’s offer marked an increase of almost 16 per cent on the previous rejected bid put forward by his EP Group last month. Kretinsky – known as the Czech Sphinx – already owns 27.5 per cent of IDS, co-owns West Ham United and holds a stake in Sainsbury’s.
Proposal: IDS bosses this week said the company was ‘minded’ to accept a £3.5billion takeover offer from Daniel Kretinsky
But he was yesterday told he must pass national security tests and meet trade union demands to avoid his takeover plans being scuppered.
Chancellor Jeremy Hunt said the Government would examine ‘risks’ posed by the offer. This appears to suggest that Kretinsky’s bid will be called in by the Government for scrutiny under the National Security and Investment Act.
But he also faces growing pressure to guarantee that vital services are protected – with Business Secretary Kemi Badenoch asking for cast-iron guarantees that its six-day a week service is maintained and campaigners demanding that the sale must be blocked.
The boss of the Communication Workers Union threatened strike action if its demands on working conditions and the universal service obligation are not met.
But it is not all bad for IDS and there are expected to be some signs of improvement in Royal Mail’s results.
The company lost £319million in the first half of the year – suggesting it managed to squeeze out a tiny profit in the second half.
This compares to a particularly rough 2022 when the group was hit by industrial action. Overall, IDS is expected to post profits of £3million for the year to the end of March as its Netherlands-based parcels business GLS bolsters its balance sheet.
Susannah Streeter, head of money and markets at investment platform Hargreaves Lansdown, said GLS was the ‘jewel in the company’s crown’.
‘It’s highly likely that EP Corporate Group sees plenty of long-term opportunities here,’ she added.
IDS’s group revenues are expected to hit £12.4billion.
The company will post its results on Thursday. IDS shares yesterday slid 0.6 per cent, or 2p, to 320p.
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