Royal Mail has returned an underlying profit for the first time in three years as bosses hailed an 'important milestone in the company's turnaround'.
It follows the controversial £3.6billion takeover of parent group International Distribution Services earlier this year by energy tycoon Daniel Kretinsky, bringing Royal Mail under foreign ownership for the first time in its 509-year history.
The so-called 'Czech Sphinx', known for his inscrutable approach to business decisions, was named chairman of Royal Mail not long after the deal was approved by shareholders.
IDS said Royal Mail achieved an adjusted operating profit, excluding voluntary redundancy costs, of £12million for the 12 months to 30 March, compared to losses of £336million the previous year.
However, when redundancy costs are included, Royal Mail still suffered an underlying operating losses of £8million.
The group said the result had been achieved 'despite an increasingly competitive and challenging trading environment'.
Royal Mail delivered more parcels over the last year, helping to drive its return to profit
It cited 'modernisation' efforts aimed at improving efficiency and reducing costs, parcel volumes growth, and a rapid rollout of Royal Mail's 'out of home' delivery options.
IDS says Royal Mail now has over 2,000 lockers and 7,500 Collect+ stores, 11,500 Post Office branches, 1,200 customer service points and 1,400 parcel postboxes.
The group was also given the all clear to scrap second class post on Saturdays in July as part of reforms to Royal Mail's universal service obligations.
Royal Mail gets green light to scrap second class post on Saturdays
Overall, IDS revenues were up 4.8 per cent year-on-year at £13.1 billion, driving underlying earnings of £278million, against losses of £28million in the previous year.
That was despite package arm GLS seeing adjusted operating profits fall £34million year-on-year to £286million, which IDS blamed on a 'challenging macroeconomic and regulatory environment in Germany and Italy and foreign exchange movements'.
IDS boss Martin Seidenberg said: 'It has been a year of change for IDS.
'Royal Mail returned to profit for the first time in three years, marking an important milestone in the company's turnaround.
'With IDS's acquisition by EP Group complete and universal service reform decided now is the time for us to drive the business forward and capitalise on our momentum.
'Under the ownership of EP Group we will continue to invest in the rapid expansion of our out of home network across both businesses to meet the changing needs of our customers around the globe.'
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