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The Markets
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The Markets
by Proactive
Proactive UK has moved.
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Business & education services

Royal Mail staff grumble about timing of recent profit warning

Restrictions on Royal Mail staff selling the free shares they got as part of the privatisation five years ago end today; they would have been a sight richer had the restrictions ended a couple of weeks ago

Royal Mail PLC (LON:RMG) staff have accused the company of issuing a profit warning just before employees could sell their shares on a tax-free basis.

The BBC reported that several irate postal workers have contacted the broadcaster to complain about the timing of the profit warning, which was issued on

READ: Royal Mail says UK letters volumes and productivity down, shares plunge

The company, which was privatised five years ago, issued the profit warning on October 1. Postal workers who received free shares at the time of the privatisation were obliged to hold them for five years; today marks the first day they can sell the shares.

Those workers who elected before the profit warning to sell their shareholdings would be able to cancel the sales if they wish.

The shares were floated at 330p and shot up immediately in the first few days of trading, much to the annoyance of some observers who said that Vince Cable, then part of the coalition government that sanctioned the sale of the Royal Mail, had allowed City firms to persuade him to list the shares too cheaply.

A landmark agreement towards the end of January this year with the unions on productivity and the defined benefit pension plan sent the shares up from 466p to an all-time high of 611.4p in May but following the profit warning the shares are languishing at around 341p.

READ: Royal Mail looks like the proverbial falling knife

A spokesperson for Royal Mail told the BBC that the company had an obligation to tell the market about the lacklustre productivity enhancements achieved this year.

While expressing sympathy with the plight of staff, the spokesperson said the was no link between the timing of the profit warning and the free shares owned by staff.

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