Royal Mail reported a significant jump in profits this morning thanks to a number of one-off gains, as it posted its first set of results since listing.
The business - which enjoyed one of the most successful float's ever thanks to a lowly share price which critics of the listing process said massively undervalued the company - reported a jump in profits from £94m to £233m.
The results were lifted by a one-off VAT credit of £35m, lower depreciation and amortisation of £10m, as well as a £50m gain from lower transformation costs than previously expected.
Including a major change in the way it accounts for its pensions, profits were £1.58bn, but analysts are focused on the figure excluding this gain.
Revenues of £4.52bn were up 2% compared to the same period last year, slightly ahead of analysts forecasts, although the profit figure of £233m undershot some forecasts.
Royal Mail said parcels now accounted for 51% of its revenue. Business from letters continued to decline.
"Our first half financial performance was in line with our expectations of delivering low single digit revenue growth and margin expansion," said Royal Mail chief executive Moya Greene.
Business Secretary Vince Cable will face a select committee hearing later over concerns the postal service was undervalued. The float price of 330p soared to nearly 600p after the shares started trading. The are currently trading at 533p.
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