Thursday, May 23, 2024 2:33 p.m
Royal Mail’s parent company International Distribution Services (IDS) failed to deliver its full-year business update on time, scheduled for 7am on Thursday morning, as a possible takeover hangs over the group.
IDS was due to announce its full results for the 2024 financial year this morning, but at 7.42am the press team sent an email apologizing for the inconvenience.
It said there was “a delay in releasing our results this morning. We expect them to be awake within the next hour.”
After several hours of silence, at 1:46 p.m. the company issued the following statement: “International Distribution Services plc today announces the delay in the release of its financial results for the 53 weeks ended 31 March 2024, previously scheduled for 23 May 2024.
He added: “The group’s auditor, KPMG, requested additional time to complete the usual standard procedures after their internal controls fell behind the audit schedule, delaying the final audit process.
“The board confirms that it expects adjusted operating profit (excluding voluntary redundancy costs) for the 53 weeks ended March 31, 2024 to be roughly in line with previously published guidance,” the statement concluded.
The company said it would make another announcement as soon as possible, but the news was poorly received by the market, with shares falling four percent.
This happened at a time when IDS remains in the bidding period following last week’s announcement of a potential takeover of Czech billionaire Daniel Křetínský by the EP Group.
Last Wednesday it said it was “minded” to accept an increased takeover bid worth around £3.5bn.
The FTSE 250 company’s shares soared as much as 20 percent after the update, with IDS saying it was likely to agree terms and price on the proposal if Křetínský submitted a firm offer.
Křetínského EP Group, which already holds a roughly 27.6% stake in IDS through its affiliated group Vesa Equity, increased its proposal to 370p per share, including a 10p dividend.
The potential takeover comes as Britain’s national postal service, which was privatized in 2013, calls for urgent measures to modernize its operations. Royal Mail is struggling with rapidly falling letter volumes and increased competition from nimbler rivals such as Amazon, Evri and DPD.
In its third-quarter results, IDS said group revenue rose 9.8 percent compared with the same period in 2022 as Royal Mail regained some customers, although this was partly offset by increased costs due to wage increases and inflation.
The company reported a loss of £169 million in the first half of the year.
This article has been corrected to reflect this statement issued by IDS at 1:46 p.m.