Royal Mail Trading Statement

[idpickering]

Moya Greene, Chief Executive Officer, Royal Mail plc, said:



"Our postmen and women delivered a great service at Christmas, even better than last year, with 138m parcels handled in December alone. Our comprehensive planning, which started much earlier this year, enabled us to deliver this service for our customers right across the UK.



"Group revenue in the first nine months was in line with our expectations, with 9% revenue growth in GLS offsetting a 2% decline in UKPIL revenue. UK parcel revenue was up 3% with volumes up 2%. Total letter revenue was down 5% with addressed letter volumes, excluding elections, declining by 6%.



"Our cost avoidance programme is on track. We continue to target a reduction of up to 1% in underlying UKPIL operating costs before transformation costs in 2016-17."

Full item here;

http://www.investegate.co.uk/royal-mail ... 00105494U/

disc - I hold.

[monabri]

"Recent Developments" ....
Google "rmg pension scheme" interactive investor article of June 2015 (15,). (Sorry I can't give link but it is on the first page of the Google search).

In the end , the RMG management team will get their way re final salary pension scheme (this is NOT France) so there will be trouble ahead. I would be tempted to wait until this issue is resolved before investing.

[idpickering]

"Recent Developments" ....
Google "rmg pension scheme" interactive investor article of June 2015 (15,). (Sorry I can't give link but it is on the first page of the Google search).

In the end , the RMG management team will get their way re final salary pension scheme (this is NOT France) so there will be trouble ahead. I would be tempted to wait until this issue is resolved before investing.

Thanks for your input monabri. Your opinion is much in line with my reasoning in my post regarding me topping up AZN tomorrow rather than the likes of RMG;

" I am aware of the decline of the SP of RMG this morning, but am holding off adding there for now. You don't have to have a finger in every pie."

viewtopic.php?f=15&t=2356&start=20

Ian.

[Wizard]

I appreciate the pensions concerns, but I can't fathom any new news on that issue in the RNS. So what else is it in the RNS that people think may have caused the increase in yield?

"Our performance in the first nine months of the financial year was in line with our expectations...

...Our outlook for UK letters and parcels trends and other guidance remain unchanged from that set out in our financial results for the half year ended 25 September 2016."

Terry.

[idpickering]

I appreciate the pensions concerns, but I can't fathom any new news on that issue in the RNS. So what else is it in the RNS that people think may have caused the increase in yield?

"Our performance in the first nine months of the financial year was in line with our expectations...

...Our outlook for UK letters and parcels trends and other guidance remain unchanged from that set out in our financial results for the half year ended 25 September 2016."

Terry.

I get where you're coming from Wizard. It always baffles me when my holdings perform in mysterious ways, for what appears an unknown reason. The stock is down 2.4% as I type. For me I cope with such things by reminding myself that HYPing is about the income. A fall in my holdings SP is a buying opportunity as the stock is on sale. And think longer term than just today. Over years of holding any given share the ups and downs become a mere blip. In short, I am not concerned about RMG's SP performance. Just give me the dividends.

Ian.

[Wizard]

I appreciate the pensions concerns, but I can't fathom any new news on that issue in the RNS. So what else is it in the RNS that people think may have caused the increase in yield?

"Our performance in the first nine months of the financial year was in line with our expectations...

...Our outlook for UK letters and parcels trends and other guidance remain unchanged from that set out in our financial results for the half year ended 25 September 2016."

Terry.

I get where you're coming from Wizard. It always baffles me when my holdings perform in mysterious ways, for what appears an unknown reason. The stock is down 2.4% as I type. For me I cope with such things by reminding myself that HYPing is about the income. A fall in my holdings SP is a buying opportunity as the stock is on sale. And think longer term than just today. Over years of holding any given share the ups and downs become a mere blip. In short, I am not concerned about RMG's SP performance. Just give me the dividends.

Ian.

Thanks Ian. To be honest I am not worrying about capital on this, but always a little frustrating for a share to fall soon after you buy it as a higher yield is now available. But it was more a matter of whether I had missed something in the announcement that others had spotted.

Terry.

[idpickering]

Thanks Ian. To be honest I am not worrying about capital on this, but always a little frustrating for a share to fall soon after you buy it as a higher yield is now available. But it was more a matter of whether I had missed something in the announcement that others had spotted.

Terry.

Hi again Terry. Having read the announcement again, nothing leaps out at me as a major cause for concern. I'm happy to let the RMG managers do their job, and manage. It is likely that I'll be topping up my holdings over the coming months.

Regards,

Ian.

[77ss]

Having read the announcement again, nothing leaps out at me as a major cause for concern. I'm happy to let the RMG managers do their job, and manage. It is likely that I'll be topping up my holdings over the coming months.

Regards,

Ian.

It looks like a business in decline to me. However much they might like to praise the posties (spoken to one lately?).

Core mail income steady and long-term, but going down. Junk mail income is flat.

Parcels? Well, a 2% volume growth may seem OK, but set against a background of some 15-20% annual growth in internet shopping does it represent serious under-performance?

I don't hold, but have looked at it. Too many potential downsides - and I don't need the diversification. A good buy initially (particularly for the scandalous Government's advisors!), but not now, in my view.

[Arborbridge]

It looks like a business in decline to me.

I agree, 77ss, which is why I ignored them when they launched. Troubled history, and no experience of the real world being sheltered for a hundred years and more.

No, the omens were not good. However, I have to admit to buying my fair share of horror stories, so am not complacent - just lucky this time not to be sucked in.

Arb.

[monabri]

I intend to buy into Rmg just after the postie s threaten to go on strike over pension cuts. Bad news for Pat but good news for HYpers. Save a bit of cash for this event - it is likely to happen pretty soon.

[idpickering]

I intend to buy into Rmg just after the postie s threaten to go on strike over pension cuts. Bad news for Pat but good news for HYpers. Save a bit of cash for this event - it is likely to happen pretty soon.

What an interesting take on this monbri. Good luck with your plan.

Ian.

[monabri]

Currently RMG is rated as a good company (81% on the Stockopedia scale MUCH higher than VOD/TW/SSE/NG ).

I was hesitant earlier this week and the SP fell from 428p to 414p. If there is "trouble ahead" I can imagine this would panic a lot of people and the SP would be depressed further - hence the buying opportunity and with it a good dividend.

The dividend is expected to rise to 5.57% and 5.78% in 2017 and 2018 respectively. So, let;s assume a 10% fall when postie goes on strike.

Let's assume a SP drop of 10% on bad news - from say 420p to 378p. Thus divvis would/could be 23.1p [6.1%] for 2017 and 23.9p [6.3%] for 2018.

In teh end the senior mgt teams always seem to get what they want and then the sp will rise again as the pension liability reduces as Pat is shuffled off onto a poorer pension scheme (sorry, Pat!)

Yes, this is guesswork but I certainly don't assume the sp will increase when we are not getting our post.

Just an opinion .. that's what we Lemons do!