Royal Mail share price: Postal group prepares for Christmas rush

on Oct 25, 2016
Updated: Oct 21, 2019

Royal Mail (LON:RMG) is opening nine temporary parcel sort centres to help it deal with the upcoming Christmas peak season, the postal services group has announced.

Royal Mail’s share price edged lower today, having lost 0.18 percent to 489.90p as of 14:41 BST. The stock is underperforming the benchmark FTSE 100 index, which currently stands 0.85 percent up at 7,044.23 points. Royal Mail’s shares have risen more than nine percent over the past year, and are just almost 11 up in the year-to-date.
According to a company press release, the additional parcel sort centres will be in Bathgate in West Lothian, Rochdale, Leeds, Puntyclun in South Wales, Birmingham, Swindon, Greenford, Atherstone, and Coventry for international parcels and cards. The sites will open on a phased basis from October 31 with around 3,300 seasonal workers, supporting Royal Mail’s 120,000 permanent postmen and women.

The postal operator has also set up a dedicated website for people to apply for positions in the centres and at other sites across the UK. Royal Mail is taking on around 19,000 seasonal workers in total this year across its operations.
This is the sixth year that Royal Mail has opened a dedicated network of parcel sort centres. The move signals expectations for an increased demand during the key festive period despite recent competition concerns.

Last month, Royal Mail’s share price dipped to the bottom of the FTSE 100 benchmark index after Deutsche Post agreed to buy smaller rival UK Mail for £243 million. The deal has fuelled competition concerns with the privatised postal services operator already competing with Deutsche Post in the wider European market through its General Logistics Systems business.
Analysts at Liberum said at the time of the announcement: “UK Mail competes with Royal Mail in bulk letters and parcels. We would expect it to become a much more powerful competitor with the backing of a much larger, financially stronger and ambitious owner.”
As of 15:01 BST, Tuesday, 25 October, Royal Mail share price is 512.75p.

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