Royal Mail says that it saw parcel volumes grow strongly during the year to end of March, particularly as people stayed at home and ordered online during the pandemic with revenues from parcels providing the majority of its revenue for the first time ever. Its returns service also grew.
In its latest results, announced today, it revealed that account parcel volumes grew by 48% and its Tracked 24 /48 and Tracked Returns services also performed strongly with 79% growth.
“Parcels now represent 72% of Group revenue,” said the company’s non-executive chair Keith Williams. “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.”
International parcel volumes grew in the first half of the year, driven by imports, but declined in the second half, due to reduced air freight capacity and increased conveyance costs, along with the challenges of Brexit and the requirement for customs forms and/or taxes and duties to be paid for imports and exports to and from the EU.
However despite the decline in volume, Royal Mail said that international revenue grew, as necessary price increases were required to cover higher conveyance costs and terminal dues.
Parcel revenue grew 38.7% year on year, 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.
