Evri doubles profits after record year for deliveries

A parcel company that previously received brickbats for poor service has more than doubled its annual pre-tax profits after a “record year” for deliveries.

Evri said that a £32 million investment in customer service and the growing number of consumers shopping online for second-hand goods had helped to boost growth, with parcel volumes rising by 14.9 per cent to more than 730 million during the 53 weeks to the end of February.

Pre-tax profits at Evri Limited climbed to £119 million from £51 million the previous year.

The figures underscore a turnaround for the company which came under scrutiny in January last year after complaints that thousands of people were left waiting for Christmas deliveries. At the time Evri said that staff shortages, Royal Mail strikes and bad weather had contributed to the problems.

Martijn de Lange, the chief executive of Evri, said: “The company’s best ever year was underpinned by significant investment in our operations and customer service, as well as deepening our relationships with retailers and forging new partnerships.”

Revenues rose to £1.7 billion, a 15.2 per cent increase on the same period a year earlier, with earnings before interest, tax, depreciation and amortisation rising by a third to £292 million. Ranking behind Royal Mail and Amazon Logistics, Evri is the third biggest parcel company in the UK, with a market share in 2022 of 14 per cent, according to figures from Pitney Bowes, the technology company.

At a group level, pre-tax losses narrowed to £10.5 million from £43.2 million the previous financial year. The company said the losses were largely due to financing costs and one-off charges.

The results come after Evri was bought by Apollo Global Management, the private equity firm, for £2.7 billion in July. It is not the only logistics business to be targeted for a takeover. Daniel Kretinsky, the Czech billionaire, has made a £3.6 billion recommended bid for Royal Mail, a move being scrutinised under the National Security and Investment Act.

Evri, which used to be called Hermes, began life in 1974 as Grattan Mail Order, providing home delivery services for the clothing retailer.

The parcel service company said it had reported a strong first half of the new financial year, with revenues for the 26 weeks to August 31 climbing to £865 million, a 10.6 per cent increase from the same period last year.

Forecasts also point to a busy Christmas, with research from FedEx, the world’s largest express transportation company, and Effigy Consulting predicting a 10 per cent jump in the number of parcels delivered in the run-up to the festive period. They expect 1.29 billion parcels to be delivered in the UK in the three months to Christmas, up from 1.17 billion during the same period last year.

The figures also show that the UK is expected to be the busiest market for parcel deliveries in Europe, ahead of Germany, where estimates point to 1.08 billion deliveries, and France with 524 million.