Whistl UK has confirmed the closure of its end-to-end delivery service after revealing the operation lost £10.3m in the year to December 31, spiralling from £2.1m the previous year.
The Dutch-owned company, formerly known as TNT Post, suspended its final mile deliveries last month and shelved expansion plans after talks broke down with its investment bank.
It was to become a joint venture between original Dutch owners PostNL and Lloyds Bank’s private equity arm LDC after an agreement was reached in December 2013. Some estimates put the cost of Whistl’s planned expansion in Edinburgh, Glasgow and Birmingham at £70m.
Despite boss Nick Wells assertion that Royal Mail put the squeeze on his business, Whistl’s latest results show just why LDC was not keen to complete the deal. Costs and administrative expenses surged from £2m to £10m, too.
Back in 2013, when the firm revealed it was to take on Royal Mail on the doorstep, Herna Verhagen, the chief executive of Dutch postal service PostNL, said: “Customers are satisfied because of the quality, but also because we have a track-and-trace system on mail items in the UK, so customers can follow deliveries on the Internet. This is new, it’s a unique selling point in the mail market.”
Perhaps unsurprisingly Royal Mail shares had a pretty good day on the back of the news, rising just over 2% to 504.01 per share.
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