UKM.L Regulatory News (UKM)

15 January 2014

UK Mail Group plc

INTERIM MANAGEMENT STATEMENT

"Good performance in peak Christmas trading period"

UK Mail Group plc (the "Group") today issues the following Interim Management Statement covering the period 1 October 2013 to 31 December 2013.

Overall, the good performance for the third quarter was in line with our previous expectations. Reported Group revenues for the quarter showed an increase of some 6% compared to the same period in the previous year.

Our Parcels business delivered good volume growth of some 15% compared to the same period last year. As expected, parcels volume growth has moderated compared to the first half of the year, reflecting the higher growth levels we achieved in the second half of last year. Volume growth in the third quarter was again partly driven by an increase in internet shopping related home deliveries, which resulted in a continuation of the mix change towards B2C that we saw in the first half. We invested in our network to ensure we could successfully handle such high peak volumes and as a result, our leading customer service levels were maintained throughout this very busy trading period.

Our Mail business achieved good revenue growth, due to a further increase in mail volumes. This growth continues to be driven by strong customer retention and new customer wins.

Our Courier business saw a slight decline in revenues, as expected.

Our Pallets business also saw a decline in revenues for the period, however we continue to invest in developing our Pallets network in order to return to the sales levels previously achieved.

The Group remains in a sound financial position.

Guy Buswell, Chief Executive of UK Mail, said:

"I am pleased to report that we have again performed well during our peak Christmas trading period, maintaining our strong customer service levels even as volumes continued to increase. It is clear from weekly volume patterns that shoppers were, more than ever before, leaving their online Christmas shopping to the last minute, as consumers increasingly trust that online deliveries will arrive on time, as promised. This underlines the importance of our leading consumer-friendly services in which we continue to invest.

"We are making good progress with the strategic investment in our business. As previously announced, we have now received planning permission for our new central sortation hub near Coventry and our new one hour delivery window project is on target for implementation in the spring of 2014."

Notes to editors:

About UK Mail Group plc

UK Mail Group plc is the leading independent parcels, mail and logistics services company within the UK and one of the main alternatives to Royal Mail for business mail requirements.

Forward-looking statements

This announcement contains certain forward looking statements with respect to the financial condition, results of operations and businesses of UK Mail Group plc. These statements involve risk and uncertainty because they relate to events and depend upon circumstances that will occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements. Nothing in this announcement should be construed as a profit forecast.

The information in this announcement is based on unaudited management accounts and is before any exceptional items.