Royal Mail has announced its financial results for the nine months ended December 27, 2020. Group revenues increased by 13.5% to £9,312m, growth was primarily attributed to a surge in e-commerce.
Keith Williams, non-Executive Chair, commented: “The third quarter saw unprecedented parcel volumes in Royal Mail, driven by online shopping and the peak Christmas period, with 496m parcels handled, the busiest in our company’s long history. 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. GLS also saw elevated volumes and delivered 228m parcels in the third quarter, growth of 27%.”
The Group’s Royal Mail (UKPIL) business division’s total revenues were up 9.6% year-on-year. This growth was stronger than anticipated and the highest since privatisations in 2013, with parcel revenue growth more than offsetting the decline in letters.
Parcel volumes were up 31.0% year-on-year and revenue increased by 37.0% compared to the same period in 2019. Growth was driven by e-commerce and the period included Black Friday and Christmas, as well as the introduction of tighter COVID-19 restrictions regionally across the UK. Royal Mail domestic account parcel volumes, excluding Amazon, were up 50%. Tracked 24/ 48 and Tracker Returns volumes, its key e-commerce products, grew by 73.0% compared to the same period in 2019.
Total letter revenue decreased by 16.0% year-on-year. Addressed letter volumes were down 23.0%, helped by more robust volumes in December (a decline of 9.0% in the month). Nationwide COVID-19 restrictions had a negative impact, leading to a volume decline of 24.0% in January 2021, around the level seen in the second quarter but still an improvement compared to the start of the financial year where volumes contracted by a third.
GLS continued to perform strongly, with volume up 23.0% year-on-year and revenue up 24.4% compared to the same period in 2019. The increase was driven by growth in B2C and international volumes as a result of new lockdown restrictions across its network. Spain, Europe East and Denmark, in particular, saw strong revenue and volume growth in the first nine months of 2020.
Source: Royal Mail
