Royal Mail PLC said Thursday that it expects its strong nine-month results and the effect of renewed coronavirus restrictions to boost full-year adjusted operating profit to well over 500 million pounds ($691.8 million) in fiscal 2021.
The British letter-and-parcel courier said results benefited from increased online shopping amid continuing social restrictions and peak trading at Christmas time.
The company said it expects full-year revenue growth to beat its previous guidance for an increase of GBP380 million to GBP580 million.
"Trading over the third quarter and into January was stronger than anticipated, primarily driven by the reintroduction of nationwide Covid-19 restrictions," Royal Mail said. The company also warned higher parcel volumes will cause an increase in handling costs.
The courier said group revenue rose 14% year over year to GBP9.31 billion in the nine months ended Dec. 27, including a 20% increase on year during the third quarter, which saw 496 million parcels handled by the company and marked Royal Mail's busiest quarter ever.
Royal Mail also said the higher parcel volumes and an increased rate of absence among its staff due to the pandemic has hurt the quality of its services at times. "Given these record volumes, we recognize that at times our service during the period was not always as we would have wished," the company said. However, the courier said it has retained 10,000 of the 33,000 flexible workers from the Christmas peak to help efficiency.
