Royal Mail profits almost double
Royal Mail has seen its annual profits almost double, as all four parts of the business went into the black for the first time in 20 years.
Royal Mail has seen its annual profits almost double, as all four parts of the business went into the black for the first time in 20 years.
The state-owned firm made a group-wide operating profit of £321m in the year to 31 March, up from £162m a year ago. This came after its main letter delivery business and its Post Office arm returned to profitability.
The government is continuing plans to part-privatise the Royal Mail, saying outside funds are vital for its future. The government says one key reason for the need of outside investment is the extent of Royal Mail’s pension deficit.
According to Royal Mail’s latest figures, this has more than doubled over the past year to £6.8bn.
It also warned that mail volumes declined 5.5% during the 12 months, and predicts they will fall by a further 10% in the current financial year due to the recession and the continuing growth of electronic communications such as e-mail.
Royal Mail chief executive Adam Crozier said the firm had made a “huge effort” to modernise and improve its efficiency.
Annual profits at Royal Mail’s letter delivery unit totalled £58m, compared with a loss of £3m for the year before. The Post Office business made a profit of £41m, compared with a £34m loss a year earlier.
“Our people have delivered strong financial results and high quality customer service across all our businesses in the face of extremely challenging trading conditions,” said Mr Crozier.
The Royal Mail did not release any pre-tax profit figures, which are generally considered to be a more accurate guide to a firm’s underlying financial performance.
