UK Mail has posted a 11.3% hike in pre-tax profit to £17.8m, despite seeing a slight fall in turnover in both pallet and parcel divisions.
Revenue was broadly flat at £385.2m for the year ended 31 March, compared to £385.7m in 2009; pre-tax profit increased to £17.8m from £16m.
Speaking at the London Stock Exchange, Steven Glew, group finance director at UK Mail, said good growth in its mail and courier divisions had offset a decline in turnover in other sectors.
Turnover in the mail arm rose 5.4% to £173.5m from £164.5m in 2009 and increased by 5.1% to £17.9m from £17m in the courier operation.
However, the firm expects its parcel business to increase market share as consolidation in the sector continues. For the six months to 31 March the price per consignment has improved, it adds.
Meanwhile new services such as iMail, its web-to-print postal service, have also been well received, with 2,000 customers now actively using the service.
During the period, cost savings were achieved by the closure of depots in Stoke-on-Trent, Staffs; Telford, Shrops; Livingston, West Lothian; and Edinburgh.
The company went live with a new £2m sorting machine in Birmingham In OCtober 2009, which has led to improved vehicle utilisation.
CEO Guy Buswell tells Roadtransport.com: "We expect to continue our organic growth this financial year, but we now have the advantage of signing a Royal Mail deal, which allows us to operate a packet collection and delivery service up to 5kg, using Royal Mail for final delivery. This will likely drive growth in our mail business this year."
UK Mail anticipates there could be up to two further depot closures before March 2011.
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