Deficit black hole delivers blow to Royal Mail

Deficit black hole delivers blow to Royal Mail

Royal Mail warns size of pensions deficit could force it into bankruptcy

Royal Mail could be forced into bankruptcy by its £4.25bn pensions deficit,
the company has warned.

Adam Crozier, chief executive of Royal Mail, said: ‘Royal Mail must get a
realistic price control from the regulator in order to invest in the company and
tackle the pension fund deficit’.

The news came after the company announced a 20.5% increase in operating
profits in the six months to September 2005.

Better financial performance from the company’s parcel delivery divisions
contributed to an operating profit of £159m, but the volume of letters declined,
as did profits for the division.

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