(RTTNews) - International Distributions Services plc (IDS.L), the owner of Royal Mail and GLS, on Wednesday reported that its third-quarter performance was in line with expectations in both divisions.
Looking ahead, Royal Mail is on track to return to adjusted operating profit for fiscal 2025, despite the difficult market environment. The projection represents a significant milestone in the turnaround of Royal Mail, following two years of losses.
In its trading update for the three months ended December 2024, the company reported successful Christmas period across the Group.
IDS noted that both the operational and financial performance of Royal Mail continue to improve, providing a solid foundation for the business to build on in future.
Royal Mail generated high level of reliability with over 99 percent of items posted on or before the last recommended posting dates arriving in time for Christmas. During the period, the company recorded strong growth in tracked parcels over Christmas. Total Tracked 24 / 48 volumes increased 19 percent year on year to 188 million parcels.
In GLS, performance in line with expectations, with good export volume growth.
Keith Williams, Chair of IDS plc, said, "The performance in Q3 demonstrates the continued progress of the Group over the last five years. Until then Royal Mail had been slow to implement the changes necessary to adapt to customer demand for more parcels and fewer letters, leading to declining profitability. Over the last five years both management and colleagues have faced a letter volume decline of 35 percent and further growth in parcels, which required significant investment and changes to how we operate."
The company said it plans to grow its network to over 21,000 drop off locations by the end of March 2025, including c. 1,500 lockers.
Regarding the offer by EP UK Bidco Limited, the company continues to expect that Recommended Offer will become or be declared unconditional in the first quarter of calendar year 2025, subject to required conditions being satisfied or waived.
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