Nov 19, 2020
Royal Mail parcel revenues overtake letters for first time
Royal Mail has said revenue from parcel deliveries has surpassed letters for the first time, fuelled by a surge in online shopping during the pandemic. The postal group said turnover from parcels now makes up 60% of its total revenue, which rose by nearly 10% in the first half of its financial year. Pre-tax profit fell 90.2% to £17m. During the six months to 27 September, Royal Mail's increased costs included £85m related to Covid-19 as well as £147m on voluntary redundancies. While revenue from letters dropped by 20.5%, parcel rose by 33.2%. Royal Mail said that on its busiest day it processed 2.5 million tracked parcels while its international parcels business, GLS, also saw increased volumes, "In particular as China emerged from Covid-19 restrictions and economic activity increased early in the period". Looking ahead, it said it was difficult to give an outlook for its second half, "Given the uncertainty surrounding the development of the pandemic in the remainder of the year and possible recessionary impacts across our business, which could have a significant influence on parcel volumes".
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