30th Mar 2021 09:16
(Alliance News) - Royal Mail PLC on Tuesday unveiled plans to pay a dividend for 2020, as it said trading remains in line with the update it released earlier in March.
Royal Mail shares were up 1.8% at 519.12 pence early Tuesday in London.
Adjusted operating profit for the financial year ending on Wednesday is still expected to be around GBP700 million, the London-based parcel and letter courier said.
After reviewing its performance over the past year, it has decided to pay a one-off final dividend of 10p per share. Royal Mail expects to unveil a new dividend policy as its results on May 20.
Royal Mail - boosted this year by the pandemic, with customers turning to online shopping as high street stores were forced to shut - had previously said it would not pay a dividend for the 2021 financial year, resuming only in financial 2022.
For financial 2020, Royal Mail paid out 7.5p in total, having skipped a final dividend, down from 25p the year before.
The postal operator added that it will provide a business update on medium-term targets for the GLS international parcel arm later on Tuesday. This includes a focus on international and business-to-consumer as key growth opportunities.
From the 2020 financial year to 2025, GLS expects to grow revenue at a compound annual growth rate of around 12%, more than double operating profit to EUR500 million and generate EUR1 billion of free cash flow. For financial 2021, Royal Mail expects GLS to report adjusted operating profit of GBP350 million, with a profit margin by the same measure of 8.7%.
An update for the Royal Mail business in the UK will be provided alongside the group's annual results in May.
By Tom Waite; [email protected]
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