Royal Mail Group PLC said parcel volumes slowed sharply since the easing of Coronavirus (COVID-19) lockdown restrictions but kept its guidance for profits unchanged.
In the two months to the end of this August parcel volumes at Royal Mail fell 9% to 246mln, though letters rose 2%. Volumes at its overseas arm GLS rose 7%.
Volumes are still well above two years ago, the postal group said, with the number of domestic parcels handled up by 32% against the same period in 2019.
Revenues in July and August 2021 rose to £1.97bn or 1.9% above last year and 13.9% higher than 2019.
Year-on-year Royal Mail sales were flat as a 4.6% drop in total parcels revenue was offset by a recovery in letters. GLS revenues rose by 4.5%.
The first-half profit (to September) was again forecast to be in the region of £395-400mln, with £230mln at least from Royal Mail.
Over the rest of the year, costs are rising in the UK but operating profit and margins will be higher in the second half due to its recent union agreement and other cost savings.
GLS is also seeing costs rise and running into some labour shortage problems, but these will be absorbed with existing guidance of low single-digit percentage revenue growth and 8% margins.
For the five months to end August, Royal Mail handled 616mln, down 12% on a year ago but still 18% higher than the comparable period in 2019.
Letter volumes picked up 13% year-on-year but were down 19% on a two-year view.
Overseas arm GLS increased volumes by 9% and by 30% over 2019.
Revenues for the five months were £5.12bn, up by 8.2% compared to 2020 and by 17.7% over 2019.