11th Feb 2021 09:14
(Alliance News) -Â Royal Mail PLC on Thursday reported an "unprecedented" third quarter, with its busiest day for parcels ever, and guided to a sharp increase in annual earnings.
Shares in the postal operator were up 6.9% at 459.28 pence in London on Thursday, amongst the top performers in the FTSE 250 in the morning.
For the nine months to December, revenue rose 14% to GBP9.31 billion. Revenue in the UK Royal Mail unit increased 9.3% to GBP6.40 billion. Within this, parcel revenue surged by 37% to GBP3.83 billion, with parcel volumes up 31%. Revenue in the GLS international parcel business grew an equally impressive 24% to GBP2.96 billion.
Royal Mail said it was the busiest quarter for parcels in its history. On its busiest day, Royal Mail said it delivered 11.7 million parcels, being 32% more than its busiest day during the first national lockdown.
"The third quarter saw unprecedented parcel volumes in Royal Mail, driven by online shopping and the peak Christmas period, with 496 million parcels handled, the busiest in our company's long history," said Chair Keith Williams.
"The decline in addressed letter volumes slowed to 14% in Q3, with a decline of 9% in December, compared to around a third earlier in the year, excluding the impact of elections."
Given the stronger-than-anticipated trading - primarily driven by further Covid-19 restrictions and improved letter volumes - Royal Mail now expects adjusted operating profit to be well in excess of GBP500 million for the current financial year.
For the financial year ended March 2020, adjusted operating profit came in at GBP325 million, which was down 14% on 2019.
The company on Thursday commented: "Within Royal Mail trading over the third quarter and into January was stronger than anticipated, primarily driven by the reintroduction of nationwide Covid-19 restrictions which was not built into our Scenario from November, and more robust letter volumes. We now believe that Royal Mail revenue growth for the full year 2020-21 will be significantly beyond the top end of the scenario presented in November of GBP380 million to GBP580 million."
By Lucy Heming;Â [email protected]
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