Royal Mail – domestic mail down 6%

Royal Mail has released its Q1 report for 2017. Parcel volumes rose by 5% though parcel revenues rose by 3%.

The international parcels business GLS proved to be the star performer with volumes up 5% and revenues up 6%.

Royal Mail saw domestic mail volumes fall by 6% and letters revenues down by 4%.

Chief executive Moya Greene said: “Overall, we have had a good start to our financial year. Group revenue was up 1 per cent, driven by another strong performance in GLS. This more than offset a 1 per cent decline in UKPIL revenue.

“GLS continues to be a driving force for the group. Its on-going, focused international expansion is increasing our geographic diversification, scale and reach. In UK parcels, our quality of service and improved product offerings are driving high levels of customer satisfaction and attracting new customers and higher volumes. Our performance in letters was better than we expected, despite continued business uncertainty in the UK.”

In its trading statement, Royal Mail said its cost avoidance programme was on track to deliver around £190m of UKPIL operating costs avoided in 2017-18.

“We expect that our total net cash investment will be around £450m this year. Our outlook for UK letters and parcels trends and other guidance is unchanged from that set out in our financial results for the full year ended 26 March 2017.”
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