Royal Mail Profits Hit by Redundancy and Growing Competition

Royal Mail profits have fallen by 30 per cent during the first half of 2015 as the privatised company takes a hit through redundancy costs and growing competition.

Royal Mail, which saw its revenues slip from £4.48 billion to £4.4 billion, has seen nearly 3,000 staff members leave, mainly through voluntary redundancy, and rising competition from companies like Amazon using its own parcel delivery network.

Jasper Lawler, market analyst at CMC Markets, said:

"Royal Mail now has a stranglehold over letter (including Christmas card) deliveries since its main competitor Whistl quit the market, but parcels are where the money is. The boom in e-commerce and strong UK consumer confidence has brought about fierce competition between delivery companies. To date, Royal Mail has struggled in the fight for our online orders."

Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers, said:

"This is the expectedly difficult half of the year for Royal Mail, with these numbers putting even more emphasis than usual on the critical Christmas period."

The government sold its remaining 14 per cent stake in Royal Mail last month, raising £591 million for the Treasury.

If you're facing redundancy and need advice on your settlement agreement, contact our employment solicitors on 01606 834 824 for advice.

Blain Boland

Employment Solicitors