May 17, 2018 / 6:25 AM / 7 months ago

Royal Mail says full-year revenue grows but cautious on letter volumes

File Photo: A postal worker carries mail bags from a van at a Royal Mail sorting office in Altrincham northern England, February 10, 2016. REUTERS/Phil Noble/File Photo

(Reuters) - Britain’s Royal Mail Plc (RMG.L) on Thursday warned that the decline in letter volumes may come in at the higher end of its forecast range in the coming year, sending its shares down more than 4 percent.

Growth in parcel volumes and its European parcel business GLS, however, helped drive up 2 percent rise in annual revenue to 10.17 billion pounds, the postal and parcel delivery company said.

Under CEO Moya Greene, who will retire in June, the former monopoly focused on its growing European parcels business to offset declining post and parcel volumes in its home market.

Revenue at GLS, which covers 41 European markets, rose to 2.56 billion pounds from 2.12 billion pounds a year ago.

Revenue at UKPIL, which comprises Royal Mail’s core UK and international parcels and letters delivery businesses, was 7.62 billion pounds, down from 7.66 billion a year ago.

The company still expects letter volume declines of 4 to 6 per cent per annum over the medium-term, but said the decline could be at the higher end of the range for the coming year due to the new European General Data Protection Regulation.

The company said adjusted operating profit before transformation costs fell 2.5 percent to 694 million pounds in the 52 weeks ended March 25.

Reporting by Sangameswaran S in Bengaluru; Editing by Gopakumar Warrier

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