JERSEY Post recorded a loss of £6.6 million for 2022 amid a ‘perfect-storm’ of industry pressures that ‘decimated’ its margins.
However, chief executive Mark Siviter has said the States-owned entity has no plans for redundancies, was ‘closing in’ on new contracts and was ‘set for growth’.
He explained that supply-chain disruption, workforce shortages, the war in Ukraine, the cost of living crisis and industrial unrest had led to increased operating costs and a 46% gross-margin reduction.
The company also saw a 10% drop in the volume of inward mail, a 9% decline in parcels and a 73% decrease in logistics work in the Island, the firm’s annual report revealed.
Writing in the foreword to the report, Jersey Post chair Alan Merry said: ‘While we entered the year in the knowledge that it would be a difficult 12 months, by the second quarter it became increasingly clear that we were headed into what can only be described as a “perfect storm”, fanned by geopolitical and macro-economic headwind.’
Speaking to the JEP yesterday, he said: ‘Obviously, the challenge here is actually how do you sustain the services that the people on the Island want.
‘[We have] good plans in place to take the business forward, but the global impact of what happened through the Ukraine war, cost increases etcetera – and then logistics businesses moving off-Island – meant that the margin was decimated.’
However, Mr Siviter said there were no immediate concerns about a potential impact on service quality and that the situation needed to be viewed as a ‘bump in the road’.
‘In reality, this is 12 months of financial results out of several years of strategic investments and intent.
‘So we’re not planning to make any redundancies. We’re still investing in things that we feel are right in terms of our strategy.
‘We’ll make more investments in infrastructure on the Island, we’re looking to invest more in the Woodside [Logistics] business and we’re also looking to extend this site due to the additional e-commerce volumes that we’re getting predominantly from Amazon, but also with some new contracts that we’ve won as well,’ he added.
He revealed the company was ‘very close’ to closing new contracts and ‘being trusted by big global parcel providers to deliver some of those parcels for them’.
Mr Siviter added: ‘For us, that is a big tick in the box and a recognition that we do a great job actually – so that’s positive.’
He added that Jersey Post was ‘set for growth’ despite last year’s losses.
Mr Siviter confirmed there were no bonuses for executives for last year.
Mr Merry added: ‘The board took the decision that, based on the results, it would be inappropriate to be paying bonuses – it’s been a tough year.’
He stressed that Jersey Post was a ‘very flexible, very agile, very professional business’.
‘It’s been a tough year, but we’ll get stuff and actions in place to make sure that we’ll get a good plan going forward.’
