There was a delivery of glad tidings for Royal Mail shareholders yesterday as the City speculated it will make more cost savings.
The company announced plans to bring forward collection times at almost half its postboxes to before 3pm. Tony Cross, market analyst at Trustnet Direct, said: “News of changes to collection schedules raises hopes of efficiency savings.”
Royal Mail has argued that many of its rural collections are uneconomic, but the regulator Ofcom has ruled that it must have post- boxes within half a mile of 98 per cent of UK households. The company said: “Rather than decommission uneconomic postboxes ... [we] will ensure their viability by improving the efficiency of collection arrangements.”
The plan was welcomed by the City and the shares were among the top risers on an otherwise downbeat day. It added 12.5p or 3 per cent to 426.5p. It is well above last year’s 330p float price but far behind its January peak of 615p.
The FTSE 100 finished a poor week by losing 30.01 points to close at 6,567.36. It is down 2.4 per cent so far this month. Jasper Lawler, an analyst at CMC Markets UK, said: “The most recent global rally in stocks started in April during the first quarter’s earnings season. The FTSE 100 has now almost retraced the entire rally.”
Precious metal prices rallied on safe-haven demand, which in turn pushed metal miners up. Mexican miner Fresnillo sparkled 31.5p brighter to 1,012p, gold digger Randgold Resources rose 40p to 5,110p, and mid-tier African Barrick Gold advanced 3.1p to 252p.
The AIM-listed construction and property consultant Sweett Group has been embroiled in a Serious Fraud Office investigation into allegations of corruption involving a United Arab Emirates-based employee. The share price has fallen nearly 50 per cent since early December. But a group of directors and their families ploughed in to buy nearly £80,000 of shares, priced at 35.13p each yesterday, and it built up a 1.75p rise to 37.5p.
African Potash secured investment of up to $3.75m (£2.23m) to develop the Lac Dinga project in the Republic of Congo but slipped 0.25p to 3.25p.