Royal Mail delivers best Christmas performance for four years as it notches up higher revenues

It delivered more than 99 per cent of first- and second-class mail sent by the last postal dates in time for Christmas.

Stamp price increases drove an 11.8 per cent rise in letter revenues in the quarter despite a 6 per cent drop in the number posted as the long-term decline in letter sending continued.

Parcel revenues jumped 14.4 per cent as 21 per cent more were delivered than a year earlier, when the service was impacted by crippling strike action.

The firm said it had “won back customers lost during industrial action”.

IDS is set to post operating profits for its second half, but this will be offset by the £169m first-half loss, leaving it on track with guidance to “about breakeven” for the full year.

Martin Seidenberg, IDS chief executive, praised “extraordinary efforts” by staff over Christmas.

“This has led to a marked improvement in both trading and operational performance for Royal Mail over Christmas, and we have continued to win back customers,” he said.

“We need to build on this momentum.”

But despite the improvements, Mr Seidenberg reiterated his call for “urgent action” regarding its obligation to deliver letters six days a week.

He said: “With Ofcom due to publish options for the future of the universal service imminently, now is the time for urgent action.

“We are doing all we can to transform, but it is simply not sustainable to maintain a delivery network built for 20 billion letters when we are now only delivering seven billion.”

Royal Mail has asked Ofcom to axe Saturday deliveries, reducing the service from six days a week to five.

Ofcom is expected to publish its recommendations on the universal service this month.

In the statement, the group said its determination to transform ways of working, and implement the changes agreed with the Communication Workers Union in July 2023, are starting to show results in terms of quality of service.

It said this was underpinned by new policies which reduced sickness absence by around 25 per cent by the end of December 2023 compared to the prior year.

There had also been increased recruitment of permanent employees on new, more flexible contracts, which reduced the reliance on agency staff, the statement added.

The statement added: “A New Quality Control Centre drove proactive intervention - consequently by end of December only 0.2 per cent of our daily 54,000 walks were not resourced on any given day.

"Looking ahead, implementation of new indoor methods in delivery and later start times are expected to further improve performance.”