19th May 2016 06:16
LONDON (Alliance News) - Royal Mail PLC on Thursday reported a sharp fall in annual pretax profit as it pursues its business transformation plan, but it pushed up its dividend as it said it had delivered a resilient performance within a challenging market.
The privatised FTSE 100 postal and logistics operator said pretax profit for the 52 weeks to March 27 was GBP267.0 million, down from GBP400.0 million the year earlier, due to the costs related to its ongoing restructuring. Stripping out those costs and in constant currencies, operating profit grew to GBP742.0 million in the financial year from GBP740.0 million the year before.
Royal Mail declared a total dividend for the year of 22.1 pence, up 5.2% from 21.0p the year before.
Revenue edged down to GBP9.25 billion from GBP9.33 billion, again hit by currency movements and by declining volumes in Royal Mail's letters business, which offset growth in parcels volumes. Total UK revenue for the year fell 1.0%, with a 1.0% rise in parcels revenue offset by a 2.0% fall in letters revenue.
Volumes for GLS, the UK group's pan-European logistics network, grew 10% in the year, but revenue for the business was held back by the weak euro.
Royal Mail said the outlook for the UK letter and parcels market is unchanged and said its cost reduction programme is on track, though it does expect revenue growth for GLS to slow in the current financial year.
"We have delivered a resilient performance in challenging markets. Group revenue was up one per cent and our strategic focus on costs resulted in a one per cent decline in our UK underlying costs. We continue to invest in our transformation and initiatives to support growth," said Chief Executive Moya Greene.
By Sam Unsted; [email protected]; @SamUAtAlliance
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