Letter volumes fall but UK Royal Mail Group’s overall profit rises 20% with boost from European parcels business
Royal Mail Group today announced a 20.5% increase in operating profit to GBP159 million for the first half of 2005-06 but warned that profits in its letters business had fallen as growth in addressed mail volumes went into reverse.
Allan Leighton, Royal Mail Group’s Chairman, said the downturn in letters profits and volumes meant the biggest part of the Company was no longer contributing to the Group’s overall growth in profitability. The Group operating profit of GBP159 million in the six months to the end of September 2005 was a GBP27 million improvement on the same period a year earlier. But the increase was driven by better financial performance in General Logistics Systems (Royal Mail’s European parcels business), Post Office Limited and Parcelforce Worldwide. Operating profit in the letters business had fallen as addressed mail volumes declined for the first time in a quarter of a century.
