Festive deliveries boost for RM as stamp price rises offset further letter volumes drop
Royal Mail’s owner has revealed that its letter revenues – with greeting cards making up a sizable element – increased by 1.4% for the last three months of 2024 despite volumes dropping by 7%, as the parcel delivery side has put the company on track to return to annual profit.
International Distribution Services, the logistics company that includes Royal Mail, had been struggling to make deliveries on time in the run-up to the festive period, but claims improvements to its operations allowed services to run until 9pm for the first time resulting in more than 99% of items sent on or before the last posting dates for Christmas arrived on time.

However, there could be competition from Amazon’s plans to take on Royal Mail by launching deliveries on foot across central London, as part of a package to reduce emissions and become carbon neutral by 2040.
The Guardian reported that, as the total £5biilion takeover by Czech billionaire Daniel Křetínský’s EP Group nears completion, the later hours had allowed Royal Mail to meet customers’ demands for next-day deliveries over the peak shopping period, with a 19% increase over the previous year on the number of parcels sent using its tracked services, to a total of 188million.
Meanwhile, the company said there had been a 2.4% rise in parcels revenue in the three months to the end of December, amid what it called “improving operational and financial performance” and, following two years of significant losses, Royal Mail expects to return to adjusted operating profit this financial year, excluding voluntary redundancy costs, despite a “challenging macroeconomic backdrop”.
And it added that revenues from parcels rose by 3.2% in the three months to the end of 2024, while letter revenues increased by 1.4% as losses from the 7% decline in the volume of addressed letters were covered by the above-inflation stamp price rises, with first class going up twice in 2024 to hit £1.65 while second class is now 85p.

The company said this provides a “solid foundation for the business to build on in future” as the takeover deal is expected to be completed by the end of March – the government will retain a “golden share” in IDS so any changes to Royal Mail’s ownership, tax residency or HQ will need its assent while the brand is protected as long as EP Group owns the company.
However, the public has joined the greeting card industry, led by the GCA, is fighting back against Royal Mail’s plans to cut its costs by reducing second-class deliveries to alternate weekdays – a trial is set to begin in February but the industry association has set up a petition calling which it is urging all cardies to sign, it can be accessed here, and there’s a downloadable poster to display in shops and offices available here.

The GCA calls on the government to amend legislation to require parliamentary scrutiny on any change to the universal service obligation to deliver letters six days a week and parcels five days to every address in the UK for the same price, and insist such changes would be dependent on Royal Mail meeting existing performance delivery targets for letters and cards – where it has failed to do so for the past four years and was fined £10.5million by Ofcom in December following a £5.6m penalty in 2023.
Royal Mail has been insisting parcels are the way forward, but Amazon’s latest innovation will see the global retail giant challenging the 509-year-old service as it launches a pilot scheme of delivery associates walking the streets of London’s Hackney, Westminster and Islington with carts filled with packages, instead of driving from house to house.
Amazon insists the new plans will not delay or slow down deliveries, including Prime parcels, as the carts will be refilled from vans parked at points around the city – it is also expanding its fleet of electric vehicles and using electric rail services for the first time.

RM’s parcel sales across the UK by volume had remained unchanged at 334m, but revenues rose to £1.02 billion as prices increased, while the division was boosted by a better performance across IDS, where revenues jumped 6.6% to £227m.
Nicola Fyfe, EU vice-president of Amazon Logistics, said: “Decarbonising our transport network is key in helping us achieve our goal to reach net-zero carbon emissions across our operations by 2040 and this announcement is an exciting and major step forward for us in this mission.
‘The combination of our, and the UK’s, biggest ever order of eHGVs, the UK’s electric rail network now being used to transport customer packages, and the launch of restocking on the move on-foot deliveries, all alongside our partners’ fleet of electric vans and e-cargo bikes, will help us move more customer orders across our fulfilment network with zero exhaust emissions. This is a win for our customers, the environment and our business.”