Royal Mail boosted by Christmas parcel rush
PRIVATISED postal service Royal Mail delivered up to ten million parcels a day over the festive season as it benefited from the rise in online retailing.
The group, which floated in October, also said letter volumes were boosted by the high level of mailings from energy companies following a round of price rises in the sector.
However, that could not prevent a 3 per cent fall in like-for-like revenues from letters during the nine months to 29 December, although Royal Mail said this was better than the decline of 4 per cent seen in the first half of the year.
Parcel revenues grew 8 per cent after the company changed its charging structure to reflect sizes rather than weights, but volumes were flat as customers with “large uneconomic items” chose other operators in response to the pricing shake-up.
Royal Mail’s parcels division now accounts for more than half of group revenues, with the company claiming it handled significantly more parcels than any other carrier in the UK market, including 115 million in December alone.
Chief executive Moya Greene said: “Our postmen and women have again delivered Christmas for the UK. We were delighted to see that people continue to send seasonal good wishes, with Christmas cards underpinning a like-for-like increase in our December stamped mail volumes.”
Richard Hunter, head of equities at Hargreaves Lansdown, said: “Less positively, there was some cost pressure in the likes of Germany, whilst the previous threat of strike action may have resulted in some loss of business to competitors.”
The UK government has attracted fierce criticism from opposition politicians and unions who believe that it sold off a 60 per cent stake too cheaply.
Shares in the firm closed at 572.5p yesterday, up 73 per cent from the 330p they floated at, valuing the firm at £5.7 billion.
Royal Mail is due to post its annual results on 22 May, and City analysts expect the group to deliver an adjusted pre-tax profit of about £643 million for the year to the end of March, up from £588m last time.