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Royal Mail hails good performance | Royal Mail hails good performance |
(about 3 hours later) | |
Royal Mail has said trading over the past nine months "fully met" its expectations. | Royal Mail has said trading over the past nine months "fully met" its expectations. |
It said parcel volumes had risen by 4% over the period, with volumes in December up 6% as it handled 130 million parcels over Christmas. | It said parcel volumes had risen by 4% over the period, with volumes in December up 6% as it handled 130 million parcels over Christmas. |
Letter volumes fell 3%, although Royal Mail said the performance had "improved slightly over the first half". | Letter volumes fell 3%, although Royal Mail said the performance had "improved slightly over the first half". |
The company, now fully privatised, also said it was on track to deliver its cost reduction target. | The company, now fully privatised, also said it was on track to deliver its cost reduction target. |
The shares, which are widely held by individual shareholders following the privatisation that started in 2013, were up 3.5% in morning trading. | |
Moya Greene, Royal Mail's chief executive, said: "Once again we delivered a great Christmas - even better than last year's strong performance." | Moya Greene, Royal Mail's chief executive, said: "Once again we delivered a great Christmas - even better than last year's strong performance." |
The company added it had made a number of investments to improve its technological capabilities. | The company added it had made a number of investments to improve its technological capabilities. |
'Challenging' | |
Royal Mail's operations have been under review by the regulator, Ofcom, since last summer. | Royal Mail's operations have been under review by the regulator, Ofcom, since last summer. |
It is looking at the "efficient and financially sustainable provision" of the UK's universal postal service. | It is looking at the "efficient and financially sustainable provision" of the UK's universal postal service. |
The universal service is the Royal Mail's commitment to deliver to all of the UK for the same price. | The universal service is the Royal Mail's commitment to deliver to all of the UK for the same price. |
Charles Huggins, investment analyst at Hargreaves Lansdown stockbrokers, said: "Conditions in the UK parcel market look set to remain challenging." | |
But he said that Royal Mail was in a much better position than other postal operators to "weather the storm, with around 50% of the UK parcel market, so it can invest more in technology and service. | |
"There is plenty of scope to reduce costs, having spent so long in public hands. This should help to support profits, at a time when rivals are seeing margins squeezed." |
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