Analyst Views: What did you make of Royal Mail’s financial results?

 
Oliver Smith
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GERT ZONNEVELD | PANMURE GORDON
The competitive market on the parcels side is more intense and the company is taking steps to remain leader in this growing market. On the letters front, direct delivery is the main concern. Without regulatory action, Royal Mail estimates that direct delivery could hit revenues by £200m by 2017/18.

RICHARD HUNTER | HARGREAVES LANSDOWN
The company’s clear concerns around universal service pricing have eclipsed an otherwise promising set of results. The ferocity of competition in the parcels space, still growing due to the ongoing boom in e-commerce, comes as no surprise, but was specifically referred to in management comments.

NICLA DI PALMA | BREWIN DOLPHIN
While the letter business is in decline, the entry of a new competitor providing direct delivery operations in London and Manchester is concerning. Royal Mail needs to deliver the universal service; TNT Post can focus on populated, urban areas and it plans to cover 42 per cent of addresses by 2017.

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