Royal Mail PLC Royal Mail plc Full Year Results 2015-16 (6682Y)
19 Mai 2016 - 8:01AM
UK Regulatory
TIDMRMG
RNS Number : 6682Y
Royal Mail PLC
19 May 2016
19 May 2016
Royal Mail plc
Results for the full year ended 27 March 2016
To view the full Financial Report for the full year ended 27
March 2016 please click here:
http://www.rns-pdf.londonstockexchange.com/rns/6682Y_-2016-5-18.pdf
Royal Mail plc (RMG.L) today announced its results
for the full year ended 27 March 2016.
Moya Greene, Chief Executive Officer, commenting on
the results said:
"We have delivered a resilient performance in challenging
markets. Group revenue was up one per cent and our
strategic focus on costs resulted in a one per cent
decline in our UK underlying costs. We continue to
invest in our transformation and initiatives to support
growth.
"Our UK parcel revenue and volumes grew by one per
cent and three per cent, respectively. Our addressed
letter volumes declined by three per cent; total letter
revenue by two per cent. GLS, our European parcel business,
continued to perform strongly, supporting the overall
Group revenue performance.
"We are introducing new and improved products and services
and responding quickly to changing customer needs.
These measures, alongside our emphasis on customer
focus and delivering a value for money service, have
helped us to maintain our pre-eminent position in UK
letters and parcels and driven growth in GLS."
Group financial highlights
52 weeks 52 weeks Underlying
ended ended change(2)
27 March 29 March
Adjusted(1) results (GBPm) 2016 2015
--------------------------------------- --------- --------- ----------
Revenue 9,251 9,328 1%
Operating profit before transformation
costs 742 740 5%
Operating profit after transformation
costs 551 595 (2%)
Margin 6.0% 6.4% (10 bps)
Profit before tax 538 569
Earnings per share (pence) 41.3p 42.8p
--------------------------------------- --------- --------- ----------
Reported(3) results (GBPm)
--------------------------------------- --------- --------- ----------
Operating profit before transformation
costs 485 611
Operating profit after transformation
costs 294 466
Profit before tax 267 400
Earnings per share (pence) 21.5p 32.5p
In-year trading cash flow 254 315
Net debt (224) (275)
Full year proposed dividend per share
(pence) 22.1p 21.0p 5%
Business units
Adjusted operating
profit before
transformation
Revenue costs
-------------------------------- --------------------
52 weeks 52 weeks 52 weeks 52 weeks
ended ended ended ended
27 March 29 March Underlying 27 March 29 March
(GBPm) 2016 2015 change 2016 2015
------- --------- --------- ---------- --------- ---------
UKPIL 7,666 7,757 (1%) 608 615
GLS 1,580 1,557 9% 117 115
Other 5 14 n/m 17 10
--------- --------- ---------- --------- ---------
Group 9,251 9,328 1% 742 740
Group financial performance
-- Revenue was up one per cent, with growth in GLS offsetting
the decline in UKPIL revenue.
-- Adjusted operating profit before transformation costs
was GBP742 million, up five per cent.
-- Adjusted operating profit margin after transformation
costs declined by 10 basis points as a result of
increased transformation costs due to our cost avoidance
and efficiency programme.
-- In-year trading cash flow of GBP254 million reflects
increased investment in growth capital expenditure.
-- Our strategic focus on costs resulted in a one per
cent reduction in underlying UKPIL operating costs
before transformation costs.
-- Net debt reduced to GBP224 million due to free cash
flow, offset by dividend payments.
-- The Board is recommending a final dividend of 15.1
pence per ordinary share giving a total dividend
of 22.1 pence per share for 2015-16, up five per
cent.
Business performance
-- UKPIL revenue was down one per cent. A one per cent
increase in parcel revenue was offset by a two per
cent decline in total letter revenue.
-- UKPIL parcel volumes were up three per cent, driven
by continued growth in import parcels, new contract
wins in account parcels and a strong performance
in Parcelforce Worldwide. However, revenue reflected
a weaker mix due to declines in high average unit
revenue (AUR) parcels.
-- Addressed letter volumes(4) declined by three per
cent, better than our forecast range, largely due
to the return of direct delivery volumes.
-- UKPIL collections, processing and delivery productivity
improved by 2.4 per cent, within our target range
of a 2.0-3.0 per cent improvement per annum.
-- We have seen a net reduction in the number of UKPIL
employees of around 3,500 this year.
-- We narrowly missed the 93.0 per cent regulatory First
Class mail target, with 92.5 per cent of this mail
delivered the next working day. We exceeded our regulatory
Quality of Service target of 98.5 per cent for Second
Class mail.
-- GLS continued to perform strongly. Volumes were up
10 per cent. Revenue was up nine per cent, with growth
in almost all markets.
Outlook
-- Outlook for UK letter and parcel market trends remains
unchanged.
-- UKPIL cost avoidance programme on track and we expect
to avoid a similar level of costs in 2016-17 as the
prior year.
-- We continue to seek opportunities to drive efficiency,
with transformation costs currently expected to be
around GBP160 million in 2016-17.
-- Rate of revenue growth in GLS expected to slow in
2016-17.
-- We expect total net investment spend to be within
GBP550-600 million per annum in the medium-term.
-- We remain focused on in-year trading cash flow, which
underpins our commitment to a progressive dividend
policy.
(1) All adjusted results are a non-International Financial
Reporting Standards (IFRS) measure and exclude specific
items. The commentary in this report, unless specified
otherwise, focuses on the operating results on an
adjusted basis. This is consistent with the way that
financial performance is measured by Management and
reported to the Board and assists in providing a
meaningful analysis of the results of the Group
(2) All movements are on an underlying basis unless otherwise
stated. Underlying change is calculated after adjusting
for movements in foreign exchange in GLS, working
days in UKPIL and other one-off items that distort
the Group's underlying performance. For volumes,
underlying movements are adjusted for working days
in UKPIL and exclude elections in letter volumes
(3) Prepared in accordance with IFRS
(4) Excluding election mailings
For further information, please contact:
Investor Relations:
Catherine Nash
Phone: 020 7449 8183
Email: investorrelations@royalmail.com
Media Relations:
Beth Longcroft
Phone: 07435 768549
Email: beth.longcroft@royalmail.com
Registered Office:
Royal Mail plc
100 Victoria Embankment
London EC4Y 0HQ
Registered in England and Wales
Company number 08680755
A trading update covering the three months ending 26
June 2016 is expected to be issued on 19 July 2016.
Results presentation
A results presentation for analysts and institutional
investors will be held in London at 9:30am on 19 May
2016 and a simultaneous webcast will be available at
www.royalmailgroup.com/results
Disclaimer
This document contains certain forward-looking statements
concerning the Group's business, financial condition,
results of operations and certain of the Group's plans,
objectives, assumptions, projections, expectations
or beliefs with respect to these items. Forward-looking
statements are sometimes, but not always, identified
by their use of a date in the future or such words
as 'anticipates', 'aims', 'due', 'could', 'may', 'will',
'should', 'expects', 'believes', 'intends', 'plans',
'potential', 'targets', 'goal' or 'estimates'.
Forward-looking statements involve known and unknown
risks, uncertainties and other factors, which may cause
the Group's actual financial condition, performance
and results to differ materially from the plans, goals,
objectives and expectations set out in the forward-looking
statements included in this document. Accordingly,
readers are cautioned not to place undue reliance on
forward-looking statements.
By their nature, forward-looking statements relate
to events and depend on circumstances that will occur
in the future and are inherently unpredictable. Such
forward-looking statements should, therefore, be considered
in light of various important factors that could cause
actual results and developments to differ materially
from those expressed or implied by these forward-looking
statements. These factors include, among other things:
changes in the economies and markets in which the Group
operates; changes in the regulatory regime within which
the Group operates; changes in interest and exchange
rates; the impact of competitive products and pricing;
the occurrence of major operational problems; the loss
of major customers; undertakings and guarantees relating
to pension funds; contingent liabilities; the impact
of legal or other proceedings against, or which otherwise
affect, the Group; and risks associated with the Group's
overseas operations.
All written or verbal forward-looking statements, made
in this document or made subsequently, which are attributable
to the Group or any persons acting on their behalf
are expressly qualified in their entirety by the factors
referred to above. No assurance can be given that the
forward-looking statements in this document will be
realised; actual events or results may differ materially
as a result of risks and uncertainties facing the Group.
Subject to compliance with applicable law and regulation,
the Company does not intend to update the forward-looking
statements in this document to reflect events or circumstances
after the date of this document, and does not undertake
any obligation to do so.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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