IDS on track to meet FY guidance following strong Christmas performance

18th Jan 2024 08:36

(Sharecast News) - Logistics group International Distributions Services said on Thursday that it had seen a "marked improvement" in Royal Mail's Christmas performance, putting the group on track to meet full-year guidance.

IDS said Royal Mail had achieved its best Christmas operational performance in four years and had met its customer commitment to deliver items posted by the last recommended posting dates in time for the big day.

The FTSE 250-listed group noted that group revenues over the Christmas period were up by 9.8% year-on-year, with Royal Mail winning back customers following last year's industrial action.

For the year-to-date, group revenues "performed well in a difficult macroeconomic environment", increasing by 3.8% on the back of greater volumes in both Royal Mail and GLS. However, IDS said this had been offset by increased costs, including pay increases and inflationary pressures.

IDS expects to deliver a second-half operating profit, on an adjusted basis, to broadly offset the £169.0m operating loss seen in the first half, meaning its guidance for the full year remained at "about breakeven", excluding voluntary redundancy costs.

Chief executive Martin Seidenberg said: "I would like to thank all my colleagues across Royal Mail and GLS for their extraordinary efforts delivering Christmas for our customers. 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. We need to build on this momentum."

As of 0830 GMT, IDS shares were up 0.12% at 246.20p.

Reporting by Iain Gilbert at Sharecast.com