simoan wrote:monabri wrote:
Pretty much an uninvestable company I'd say!
I agree, from an operational point of view and the presence of a unionised workforce with ridiculous working practices like this. The employee cost alone is so large that a significant inflationary wage rise could pretty much wipe out profit. This is why the 50% gross margin reduces to a 5% or less operating margin even in good times.
However, it’s not without value as an investment since it trades at a significant discount to TBV. You’re currently getting £6.7bn of net fixed assets for a market cap of £2.6bn.
I think some of that asset-discrepancy might be explained in the linked Telegraph report -
Automated but unused -
A brief tour of the Mount Pleasant site, once the biggest sorting office in the world, reveals some of Royal Mail’s working practices conundrum.
There is an all-electric fleet of postal vans awaiting deliveries. Yet one floor up, every single parcel is sorted by hand. In a seemingly paradoxical situation, every parcel delivered in London leaves in a state-of-the-art zero emissions vehicle, while automatic sorting machines lie fallow.
Mount Pleasant has one such machine which will process between 6,000 and 7,000 parcels per hour but it is yet to be plugged in.
Every tiny change must be cleared by the unions – and this machine will put 30 people out of work, Thompson explains.
https://www.telegraph.co.uk/business/2022/07/16/royal-mail-union-demands-2850-week-staff-push-one-button/
It looks like the Post Office unions won't be happy until they've forced themselves and their membership out of a job.
What a shower...
Cheers,
Itsallaguess