Royal Mail of Britain (Royal Mail)

History

2023: Stop sending parcels abroad due to ransomware virus attack

On January 18, 2023, the Royal Mail of Britain (Royal Mail), an operator with about 15,000 offices across the country, announced that it had been forced to suspend a number of services in connection with the cyber attack.

The incident is reportedly related to the introduction of a ransomware program into the company's infrastructure. A preliminary investigation suggests that the attack was organized by the cybercriminal group LockBit, which spreads the eponymous ransomware virus. The peculiarity of the attack on Royal Mail is that the attackers announced their demands for a ransom by printing a message on printers connected to the company's network. In other words, cybercriminals completely hacked the postal service system.

British mail stopped sending parcels abroad

At the time of the incident's disclosure, Royal Mail said it was "experiencing major service disruptions" and warned customers it was "temporarily unable to ship overseas." It is said that the departure of those parcels that were issued before the cyber attack may be postponed.

Royal Mail continues to work with outside experts, security agencies and regulators to mitigate the impact of this cyber incident. Special attention is paid to the restoration of all services for the export of letters and parcels. Our import operations continue to be performed in full with few delays. Internal services remain in force, the postal operator said in a statement.

Nothing is reported about the demands of the attackers. Great Britain The Royal Mail continues the recovery work, noting that the export of parcels that do not require a customs declaration is resuming on all international fronts. At the same time, the company appeals to customers with a request to postpone with new shipments in order to restore the health of systems.^[1]

2022

$840.6 million annual loss after hacking scandal

At the end of the 2022-2023 financial year, International Distributions Services (IDS), the parent structure of the Royal Mail of Britain (Royal Mail), received a loss of £676 million (approximately $840.64 million at the exchange rate as of May 18, 2023). For comparison, during the previous financial year, a profit of about £662 million was demonstrated. Such data are provided in the financial report published on May 18, 2023.

IDS revenue for the 52-week period ended March 26, 2023 was recorded at £12.04 billion (about $14.97 billion). This is 5.3% less than the result for the previous financial year - £12.71 billion. The Royal Mail itself brought in £7.41 billion (approximately $9.21 billion), which corresponds to a fall of 13% on an annualized basis. Another £4.65 ($5.78 billion) fell on the parcel delivery service General Logistics Systems (GLS), which provides services in Europe and North America: this unit showed positive dynamics - plus 10.2% compared to 2021-2022 fiscal year.

Royal Mail makes £676m loss

The Royal Mail is going through difficult times. The service's business operations were undermined by a devastating attack that programs extortioners turned into a scandal. Attempts to rebuild operations in the current macroeconomic environment led to strikes and the absence of many employees in jobs. And this, according to the operator himself, negatively affected the quality of the services provided.

The published report says that against the background of weak performance of the Royal Mail and increasing investment in the profitable GLS division, the IDS board of directors decided to abandon the payment of dividends for the past financial year. It is noted that the main priority is to increase the level of customer service and restore reputation.

INTERNATIONAL DISTRIBUTIONS SERVICES plc UNAUDITED PRELIMINARY RESULTS FOR THE 52 WEEK PERIOD ENDED 26 MARCH 2023

Dismissal of 10,000 employees amid major losses

On October 14, 2022, the Royal Mail Group announced plans to restructure, during which thousands of employees will lose their jobs. The reason is the deteriorating financial situation and the ongoing strikes of workers.

According to the published report, revenue for the six-month period (from April to September 2022) amounted to £3.65 billion, or approximately $4.11 billion (at the exchange rate). This is 10.5% less than the result for the same period last year. Adjusted operating losses reached £219 million (approximately $247 million), while a year ago the service received £235 million in profit.

British Post dismisses 10,000 employees

It is noted that the losses include a direct loss of £70 million due to a three-day strike by employees. The next strikes are scheduled for October 20 and 25, 2022. Employees are unhappy with the level of wages and tougher working conditions.

The UK Postal Service plans to reduce the staff by about 10 thousand workers by August 2023 (now about 140 thousand people work at Royal Mail). In particular, approximately 6,000 employees will be reduced during direct layoffs. Another 4,000 jobs are planned to be freed up by refusing to replace people who quit of their own free will.

The report also refers to the declining volume of parcels sent: the number of shipments on an annualized basis decreased by 15%. At the same time, the fall within the country was 16%, and in the international market - 6%.

At the end of the financial year as a whole, the UK Postal Service expects to receive an adjusted operating loss of £350 million ($395 million). Moreover, this value could rise to £450 million if citizens temporarily refuse the company's services due to interruptions in its work due to strikes.^[2]

Notes