Royal Mail has reported annual results for the full year ended March 28, 2021, performing above expectations driven with strong parcel growth at both Royal Mail and GLS, according to the company. Revenue increased by 16.6%, to £12.6bn, as operating profit rose to £611m, up from £55m in the year prior.
Royal Mail revenue increased by 12.0%, to £8.6bn, as its operating profit went up by 194.0% Y-o-Y, to £344m, up from £117m. GLS’ revenue rose by 27.8% Y-o-Y, to £4.0bn, while its operating profit went up by 72.1% Y-o-Y, to £358m.
Parcel volumes are reported to having grown strongly, particularly as people stayed at home and ordered online during the pandemic. Account parcel volumes grew by 48% and Tracked 24 / 48 and Tracked Returns performed strongly with 79% growth. International parcel volumes grew in the first half of the year, driven by imports, but declined in the second half. This was due to reduced air freight capacity and increased conveyance costs, along with the transition to a new trade agreement with the EU in January 2021, and the requirement for customs forms and/or taxes and duties to be paid for imports and exports to and from the EU. Despite the decline in volume, international revenue grew, as necessary price increases were required to cover higher conveyance costs and terminal dues. Parcel revenue grew 38.7% Y-o-Y, with a positive price/mix as customers traded up to higher value tracked products. Consumer and small and medium-sized enterprise (SME) channels also strengthened throughout the year.
Keith Williams, Non-Executive Chair, said, “Parcels now represent 72% of Group revenue. The pandemic has accelerated trends we have been seeing for years in our markets. Parcels, rather than letters, provided Royal Mail with the majority of its revenue for the first time in its five-century history. Similarly, in GLS over half of our volume came from B2C, while only five years ago two-thirds came from B2B. GLS has managed this shift successfully, delivering its highest margin in thirteen years.”
Simon Thompson, Chief Executive, Royal Mail said, “Last year stood out as one of remarkable change at Royal Mail. It has been challenging at times, but we have learnt that we can deliver results and change at lightning pace when we are united by a common purpose. From starting to deliver on Sundays through to trialling drones – We’re changing. And it’s working. Looking ahead, we must remain laser focused on accelerating the pace of change, being brilliant for our customers, and doing all this in an increasingly efficient way.”
Source: Royal Mail
