Royal Mail reported a surge in first half operating profit on strong growth in its parcels business, clearing the way for the privatization of the state-owned postal group.
Operating profit, excluding modernization costs, soared to £144 million ($227.5 million) from $19 million in the year-earlier period and revenue grew 3.3 percent to $6.9 billion.
The core mail and parcels operation made a $156 million profit compared with a $64.8 million loss in the first half of 2011. Parcel volume grew by 4.2 percent and revenue increased 13 percent, offsetting a 9 percent drop in mail delivers. The parcels business now accounts for 47 percent of sales.
GLS, the pan-European express unit, booked a profit of $71 million, down 8 percent from $91.6 million a year earlier on weakening markets, especially France, and the weakness of the euro, which trimmed revenue to $1.12 billion from $1.22 billion.
“Preparations are now underway for the sale of Royal Mail Group,” the company said. ”Obtaining external capital is a key part of the transformation process as we become a more parcels-focused business and make the investment in technology to do so.”