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Jersey Post bounces back after three years of losses

Jersey Post bounces back after three years of losses

Tuesday 05 July 2022

Jersey Post bounces back after three years of losses

Tuesday 05 July 2022


Jersey Post appears to have bounced back, recording just shy of £1m in profit last year after three years of losses.

Hit by a blend of falling letter volumes, Brexit and the pandemic, the postal service ended 2020 £437,000 in the red.

The year before that, spending had outstripped income by £933,000 and in 2018, Jersey Post was left with a £267,000 shortfall.

But 2021 ended with £995,000 in profit despite new challenges emerging in the form of “significant financial loss in our counter network caused by a reduction in foreign exchange business, a general fall in retail footfall and high fixed costs, such that it was feared it would become unsustainable.”

“During 2021 significant action has been taken and with the return of outbound travel and changes to our cost structure we are confident that we can return the business performance to a manageable level with a few changes in the coming years,” CEO Tim Brown explained.

jersey post

Pictured: The latest figures from Jersey Post's 2021 accounts.

“It has been another challenging year yet, ultimately, a successful one,” Chair Alan Merry said in his foreword to the 2021 Accounts.

“Covid-19 continued to impact all areas of the business and in addition, the team had to respond, to the significant challenges posed by unprecedented international supply chain issues, changes to Customs rules along with the realities of Brexit beginning to bite.

“It is too early to speculate on the impact of the war in Ukraine but there seems little doubt that it will raise new challenges for the industry.”

Diversification

Outgoing CEO Tim Brown explained that the service’s “policy of diversification and investments” enabled it to “weather the storms throughout the year” and subsequently see 17% growth in revenue to almost £80m, marking a “second year of better than budget performance.”

Tim Brown Jersey Post.jpeg

Pictured: Outgoing CEO Tim Brown.

Over the last six years, using funding in cash reserves, Jersey Post has invested more than £8m in modernising its core operations to handle the increased island parcel business. It has also invested £14m in nine businesses.

In 2021, the business “took the opportunity to realise the value created in our investment in Parcel Monkey when it was sold”, with the “profit on this sale is now available to make further investments in Jersey and globally as required.”

According to Mr Brown, 40% of last year’s revenue came from the global logistics business which is said to be going from “strength to strength” and “now bigger than what was once our core business only six years ago.”

35% of revenue, meanwhile, came from the in-island postal business “of which parcels account for around 25% and growing”, while 2021’s acquisition of Woodside Logistics now represents 22% of turnover.

The remaining 3% of revenue relates to Jersey Post’s emerging digital segment, which, during the pandemic, helped finance businesses in particular to “connect securely”.

Sustainability check

In its annual report, Jersey Post also outlines the steps it is taking to become a more sustainable business.

While the business’s largely electric vehicle fleet should help it towards its goal of becoming carbon neutral on-island by 2030, it is also looking beyond local shores.

Mr Brown explained that, “with 40% of our business not even touching Jersey, we are also conscious that we need to look at our carbon neutral plans on a global scale, and as such, our target is to be net-zero carbon emissions globally by 2040.”

He continued: “As a postal operator, we have the ongoing challenge to deliver approximately 90,000 items daily in Jersey, which equates to our vans travelling over 675,000 miles per annum. Alongside our electric vehicles, the remainder of our fleet in Jersey now uses Biofuel, which is scientifically proven to be a carbon reducer. We have continued to look at replacement technology throughout the last year, including the adoption of electric bikes to complete mail rounds and

“LED lighting across our premises. Jersey Post’s investment in zero and low-emission vehicles
and the installation of energy-efficient equipment across our property is an ongoing programme.”

Aside from this, Jersey Post is also reducing its printed marketing materials, introducing biodegradable electric bands, removing single-use plastics from its canteen, as well as offering recycling facilities.

Workforce happiness and pay gaps

Reflecting on its 500-strong workforce, Jersey Post said a 2021 survey showed that three quarters of employees enjoyed working there and just under eight in 10 would recommend Jersey Post as a good place to work.

Turning to pay, Jersey Post noted there is still a way to go in addressing the gender pay gap: "Whilst we offer set salaries and wages for certain types of jobs, the mix of jobs means that on average male employees are paid 1.1% more than female employees (2020: 2.3%).

"However, at management levels male employees are paid 18.6% more than female employees (2020: 17.3%). These figures include the salaries of the Executive Directors."

The reported added: "We will continue our work to close this representation gap, connecting more women to opportunities, and fostering a culture where we can thrive."

According to the report, there are three types of bonus schemes in operation: staff covered by collective bargaining, members of the Executive Team and all other staff.

The total amount of bonuses earned relating to 2021 for the above three schemes was £1,116,580, compared to £954,066 in 2020.

At the executive level, CEO Tim Brown secured a bonus of £74,000 in 2021, while Chief Financial Officer Tim Barnes took home a bonus of £56,000.

The total paid to the pair was slightly less than in 2020, when they were paid £75,000 and £59,000 respectively.

New CEO

Tim Brown was due to step down at the end of June, with former CEO of DHL Global Mail UK taking up the leading role.

His recent roles have included CEO of DHL Global Mail UK, Managing Director of DHL Global Mail Europe and more recently Managing Director, Mail and Retail, at the UK Post Office.

siviter.jpeg

Pictured: New CEO Mark Siviter.

"The transformation and diversification of Jersey Post over recent years has created a dynamic and successful business that delivers significant value for the island," Mr Siviter said as his appointment was announced in April.

"I recognise the importance Jersey Post plays in the local community, through providing high quality services and supporting its people and businesses. I am excited with the opportunity and look forward to leading a business that is an important part of Island life and taking forward its current strategy."

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