Royal Mail boss’s pay package rises to £6.9m despite profits slide

International Distribution Services said chief executive Martin Seidenberg received £6.9m in pay, bonus and long-term incentive awards for the year to 31 March 2026, up sharply from £2.1m a year earlier.

The rise came despite a weaker year for the Royal Mail owner. IDS said adjusted operating profit fell 20% to £222m, even as group revenue increased 3.6% to £13.6bn.

The company said the jump in Seidenberg’s package was mainly driven by takeover-related vesting of awards after IDS was bought by Daniel Křetínský’s EP Group and delisted. In other words, the payout reflected the mechanics of the acquisition as much as the year’s trading results.

Royal Mail itself made a small profit of £5m, up from £2m a year earlier, but the business continued to face pressure from falling letter volumes and service failures. GLS, IDS’s European parcel arm, saw operating profit fall 17% to £237m.

Results and costs

IDS said total operating costs rose by £629m to £13.4bn over the year. The company pointed to higher wages and associated taxes, including employer national insurance contributions and the increase in the minimum wage, as key reasons for the extra cost burden.

Royal Mail parcels offered some offset. Parcel volumes rose 7% to 1.4bn, while letter volumes fell 10% to 5.7bn. That split underlines the continuing squeeze on the legacy letters business even as parcel delivery remains more resilient.

The group’s results therefore showed a business that is still profitable, but only just in Royal Mail’s case, and one that remains under pressure to improve productivity and service levels while absorbing rising labour costs.

Service Pressure

The numbers landed against a fresh regulatory probe. Ofcom launched another investigation into Royal Mail on 1 June after the company missed delivery targets, with 24.3% of first-class mail arriving late in the year to 31 March 2026.

That comes on top of ongoing scrutiny of a company still viewed as a public-service brand, even after its takeover. Royal Mail’s performance has become a political and regulatory issue as well as a commercial one, with service quality remaining central to any assessment of management.

The timing of the pay award is likely to sharpen attention on executive remuneration at IDS. The company has just reported a year in which profits narrowed, costs climbed and delivery performance remained under pressure, even as senior pay rose.

What Happens Next

Further detail is expected in IDS’s annual report and management commentary, including any additional breakdown of the remuneration package and the company’s outlook for the current year.

Attention will also remain on Ofcom’s investigation and on whether it leads to further penalties or changes to Royal Mail’s service obligations. Union and political reaction to the pay figure is also likely to follow.

For now, the story is a familiar one for Royal Mail: higher parcel volumes and modest profit gains on one side, but weaker group earnings, rising labour costs and continuing questions over delivery standards on the other.