Royal Mail posts a 4% rise in profits despite a drop in Group Revenue of £73m.

Royal Mail said it made £184 million operating profit for the first half of 2009/10, an increase of 4% compared to the same period last year. 

The Group said that Parcelforce Worldwide had performed particularly well, doubling its profits to £7m, from £4m in the previous half year. The exceptional financial performance was attributed to a rise in UK businesses seeking out new international market opportunities, as they took advantage of the weak pound.

Chief Executive, Adam Crozier, commented: “The improved profit is despite a drop in overall Group revenues due to the continuing decline in mail volumes and economic recession which, along with intensifying competition, had an impact on all of the Group’s businesses.”

Group revenue fell by £73m and it suffered from a negative outflow of £434m during the six months to September, which it says was largely driven by continuing investment and the cost of voluntary redundancies.

He added: “The Group’s resilient financial performance, along with some of the best spring quality of service figures on record, shows that modernisation of the Letters business is working, while the further progress made on tackling costs across the Group has helped sustain operating profit.”

Mr Crozier said it was too early to see what effect the CWU’s summer strike action may have on the company. Mainly affecting London, the union called several bouts of postal worker strikes in a long-running dispute over pay and modernisation. Further strike action was averted when the two sides agreed to an interim agreement.

However, many online businesses had already changed to alternative delivery methods to ensure their customers weren’t affected.

Earlier this month speculation was rife across some media that Royal Mail looked set to sell its stake in Camelot, the National Lottery operator. Royal Mail has a 20% interest in the company and a sale could raise a much-needed £85m.