Royal Mail posts huge profits, but says mail volumes are likely to decline in the forthcoming year.

Royal Mail has announced its operating profit has nearly doubled to more than £321 million for the year to 31 March 2009.

For the first time in nearly 20 years, all four of its core group businesses – Royal Mail Letters, General Logistics Systems, Parcelforce Worldwide and Post Office Limited – were in profit. The Post Office Limited has also seen a strong growth in Financial Services, and now boasts around two million customers.

However, it has predicted that mail volumes will decline in the forthcoming year by more than 10% due to competition from electronic communications and the economic downturn – with every 1% costing £70m in revenue.

Of the success, Royal Mail Chief Executive Adam Crozier said: “The year past has been an important one and the year ahead will be no less so.

“The challenges from the difficult and uncertain markets in which we operate remain, but we have the funding and determination to continue our journey to transformation. Our vision, achievable with our continued commitment and progress on modernisation, remains: to be demonstrably the world’s best postal company.”

Mr Crozier went on to congratulate the hard work of the Royal Mail staff, who have worked through some difficult times to bring the company into the black. The postal operator was losing more than £1m a day seven years ago.   

Royal Mail increased the price of stamps on 6 April 2009, in line with price controls set by the regulator Postcomm. For the full story, click here.