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Royal Mail warns market remains 'challenging' Royal Mail warns market remains 'challenging'
(35 minutes later)
Royal Mail has reported a 33% fall in annual profits and warned that market conditions remain "challenging" despite rising parcel volumes.Royal Mail has reported a 33% fall in annual profits and warned that market conditions remain "challenging" despite rising parcel volumes.
It said pre-tax profits for the year to the end of March were £267m compared with £400m a year earlier.It said pre-tax profits for the year to the end of March were £267m compared with £400m a year earlier.
Royal Mail chief executive Moya Greene said: "We have delivered a resilient performance in challenging markets."
UK revenue fell 1% to £7.6bn from £7.7bn a year earlier as letter volumes and revenue fell by 3% and 2%.
UK parcel volumes grew 3%, but revenue was only 1% higher.UK parcel volumes grew 3%, but revenue was only 1% higher.
But UK revenue fell 1% to £7.6bn from £7.7bn a year earlier as letter volumes and revenue fell by 3% and 2%, respectively.
Parcel volumes at Royal Mail's European division, GLS, grew 10% while revenues were up 9%.Parcel volumes at Royal Mail's European division, GLS, grew 10% while revenues were up 9%.
That helped total group revenue rise 1% to £9.2bn in the year.That helped total group revenue rise 1% to £9.2bn in the year.
The company's preferred measure of profit - adjusted annual operating profits before transformation costs - rose 5% to £742m from £740m a year earlier.The company's preferred measure of profit - adjusted annual operating profits before transformation costs - rose 5% to £742m from £740m a year earlier.
Transformation costs included 3,500 voluntary redundancies, which cost the business £117m in the year. Overall transformation costs rose to £191m in the year.Transformation costs included 3,500 voluntary redundancies, which cost the business £117m in the year. Overall transformation costs rose to £191m in the year.
Royal Mail said it reduced costs at its UK parcels division by 1%, while net debt fell to £224m.Royal Mail said it reduced costs at its UK parcels division by 1%, while net debt fell to £224m.
It added the fall in annual pre-tax profits was the result of last year's results being boosted by the profit on the sale of its Paddington depot in west London.It added the fall in annual pre-tax profits was the result of last year's results being boosted by the profit on the sale of its Paddington depot in west London.
Royal Mail chief executive Moya Greene said: "We have delivered a resilient performance in challenging markets.
"Group revenue was up 1% and our strategic focus on costs resulted in a 1% decline in our UK underlying costs. We continue to invest in our transformation and initiatives to support growth."