Petar Cvetkovic’s position under threat at DX Group?

After a profits warning and consequent fall in share value, industry insiders report that Chief Executive Petar Cvetkovic’s position is under threat at DX Group.

With financial newspapers such as the Financial Times suggesting that it is time to offload the parcel and business mail delivery company’s shares, and industry rival UK Mail ejecting its Executive Chairman in the 24 hours, there are signs that Cvetkovic’s job is at risk.

Shares fell more than 70% last week from 80p a share to 24p a share due to a plunge in profits that were excused as the competitive nature of the parcels market and a driver shortage that prevented the company from fulfilling orders that in better days it may have been able to.

DX Group has long been favoured in the markets because it offers good dividends on its shares. However it has been announced that shareholders will only get a 2.5p per share dividend this year.

DX Group has been having difficulty meeting the demands of the changing delivery market which has meant that the growing volume of parcels has caught it off guard while the falling volume of business mail has impacted its profits. Where Royal Mail has been able to meet this changing demand, smaller operators have been struggling to cope.

One of the issues has been the driver shortage, as Apex Insight reported last week. The lack of drivers available to move its goods around the country was sited as a major issue in preventing the company from meeting its demand from customers and ultimately costing it business.

There is promising news in the pipeline for the company with rumours of new contracts, though whether the ship will turn fast enough to keep its captain from being thrown overboard is something that will pan out in the coming days.

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