Israel Postal Company's board of directors has approved the financial report for 2021, which saw the company lose NIS 175 million, after losses of NIS 643 million in 2020 that included NIS 383 million, set aside for compensation for retiring employees. News of these losses come as Israel Postal Co. is in advanced talks with the workers committee, for a pre-privatization recovery plan.
Israel Postal Co. reported revenue of NIS 1.62 billion in 2021, up 2.5% from 2020 but down 11% from 2019, before the outbreak of the Covid pandemic - the most recent year in which the company reported a profit.
A "going concern" qualification was attached to the Israel Postal Co. financial report by the auditors, "Globes" has been informed. The "going concern" qualification reflects concerns about the company's ability to meet its commitments in the short term. It also makes it clear that an aggressive recovery program is required, with the state injecting hundreds of millions of shekels into the company and layoffs of thousands of employees, if the government is to be able to move forward with the privatization of the Postal Co. by selling 40% of its shares on the Tel Aviv Stock Exchange (TASE).
Estimates are that the recovery program will require laying off 1,500-2,000 Postal Co. employees, about one third of the workforce, and higher than the original estimate of 1,000. The current talks between representatives of government ministries and Postal Co. management, and the workers committee are in an advanced stage and it is hoped that an agreement in principle can be reached by the Passover holiday.
Published by Globes, Israel business news - en.globes.co.il - on March 28, 2022.
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