Business Post chief quits after three profits warnings

The parcels delivery company Business Post Group parted company with its chief executive Paul Carvell yesterday, after having posted three profits warnings this year. He was replaced by Guy Buswell, the managing director of its rapidly growing UK Mail letters business.

Peter Kane, the chairman, said about Mr Carvell's departure: "After three profits warnings he decided his future was best elsewhere." Mr Carvell was on 12 months' notice and will receive his last salary of £250,000 and £14,000 in benefits as a pay-off.

Shares in BPG slumped to 332.5p at yesterday's close, from more than 700p in February, as analysts slashed profits forecasts. Its shares have underperformed their sector by about 50 per cent over the past 12 months. Mr Carvell had blamed the slowdown in the economy for a worsening performance at the company's parcel operation, which accounts for 73 per cent of group sales.

Mr Kane said Mr Buswell would undertake a review of the group and, given his expertise, would focus on developing the UK Mail arm of the business. "Guy has been a board director since 1998 and his experience of the business and considerable success in the establishment of UK Mail as the leading alternative to Royal Mail qualify him to take the group forward as chief executive," Mr Kane said.

Despite a 21 per cent rise in overall sales, the group reported a slide in profits before tax and exceptionals to £6.2m from £8.6m for the six months to September. A bright spot was UK Mail, which increased revenues sixfold to £14.6m and turned a £500,000 loss into a £1.1m operating profit. The specialist distribution arm doubled operating profits to £1.5m.

The industry regulator Postcomm will announce today a new set of price proposals for Royal Mail. The state-owned business will have its core mail business opened to competition from next year and faces the prospect of an imposed cap on the price of postage stamps.