Proactive Investors - Royal Mail (LON:IDSI) owner, International Distributions Services PLC called on the Government to act to support the business as it reported a widened loss in the first half.
Chief Executive Martin Seidenberg said "we need the regulator and the Government to do their bit."
“It's simply not sustainable to maintain a network built for 20 billion letters when we're now only delivering seven billion.”
“The UK is not immune to the trends that we see across the world. Many other comparable countries have already reformed their Universal Service, and the UK is getting left behind.”
IDS said first half performance was in line with expectations, against a challenging macroeconomic backdrop.
Group revenue in the first half ended September 24 of £5.86 billion, was up 0.4% year-on-year, with GLS revenue up 5.9% and Royal Mail revenue down 2.9%.
Royal Mail saw growth in total letter revenue, with price rises offsetting volume decline; lower parcel revenue reflecting the weaker macroeconomic environment and a drag from the costs of strike action.
Group reported operating loss totalled £243 million compared to £157 million a year ago, with profit in GLS more than offset by loss in Royal Mail, as expected.
Royal Mail adjusted operating loss of £319 million widened from £219 million last year, in line with expectations due to lower revenue and cost of pay deal.
IDS expects adjusted operating performance for the group to be around breakeven in the full-year and expects to be able to pay modest dividend from GLS at the full year.
But Royal Mail will not be able to fund a dividend until it returns to positive cash generation, it said.