BBC News Online: Business

Post office jobs warning

The UK post office, which recently rebranded itself as Consignia, also said that rail delays had a "terrible toll" on mail deliveries and profits.

The company reported post-tax profits of £66m, which were £88m below a target agreed with the government.

"Last year's results were disappointing and the level of profit is insufficient to provide a satisfactory return to our shareholder," said Consignia chairman Neville Bain.

Consignia executives also warned that unless industrial relations improved, jobs could be lost.

Days lost

About 62,000 days were lost to strikes, which has cost Consignia tens of millions of pounds.

More damaging is the fact that some customers have been forced to switch to other delivery firms.

"We have to stabilise industrial relations," said chief executive John Roberts, adding that strikes were playing into the hands of competitors.

"It is important that our people understand that if we are not able to get it under control, there will be an impact on jobs."

Mr Roberts also said that the "self-inflicted" damage was coming at a time of greater competition for the company.

Turnover

The company's turnover grew by 7.9% to £8.1bn during the last financial year after mail volumes grew by 2.7%.

It had budgeted for a growth in volume of 3.4% and blamed the shortfall on the internet, e-mails and mobile phones.

Internal managers are unhappy with the performance of the rail network and have launched a review into lessening the company's reliance on trains.

Consignia is also seeking £6m in compensation for the delays following the Hatfield train crash.