Royal Mail posted an increase in profitability for the first half of the year up to September 2009. The Postal Company said that its modernisation programme is a key reason why postal workers staged national strikes in October however it helped boost operating profit by £7m to £184m in the six-month period.
Various modernisation techniques were introduced including a walk-sequencing machine which involves a device which organises letters into the order the postmen and women will deliver them the next morning. Adam Crozier, the chief executive of Royal Mail, said the profits and improved delivery figures on record in the spring proved modernisation of the letters business was working.
The figures reported although they show an increase in profitability it also shows a decline in mail volumes . Mail volumes fell about 8 per cent in the period. This decrease resulted in an increase in rivals' volumes such as TNT Post UK and UK Mail are gaining share. To date, one in three letters is handled by rival companies, Royal Mail admitted.
The figures reported here do not include the effect of October's industrial action by 121,000 staff. This could mean that Royal Mail might lose more share to competing companies. Let's wait and see what the next results will report.
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