UKM.L Regulatory News (UKM)

25 September 2013

uk mail Group plc

PRE-CLOSE TRADING UPDATE

"A Good First Half Trading Performance"

UK Mail Group plc today issues the following pre-close trading update for the half year ending 30 September 2013.

Current trading and outlook

Overall the Group performed well during the first half of the financial year. Trading in the second quarter has been such that overall performance for the first half year is now expected to be ahead of our previous expectations.

Reported Group revenues for the first half are expected to show an increase in some 7% compared to the same period in the previous year. Adjusted for there being three extra working days in the period compared to the equivalent period last year, the underlying revenue increase was some 4%.

Our Parcels business continued to deliver a strong performance, with average daily volumes for the half increasing by some 25% compared to the same period last year. This volume growth was largely driven by an increase in home deliveries related to online shopping, which resulted in a continuation of the mix change towards B2C that we have previously disclosed. We expect the level of parcels volume growth to moderate in the second half as we annualise the higher volume growth achieved from the end of the second quarter of the last financial year.

In our Mail business revenues were down slightly, largely due to mix changes, with our average daily mail volumes some 2% ahead of the same period last year. Mail remains well positioned in its market with a good pipeline of new business opportunities.

Our Courier and Pallet businesses performed in line with expectations, with slight revenue declines on the same period in the previous year.

The Group remains in a sound financial position.

Whilst we remain cautious about the strength of the economic recovery in the UK, the markets in which we operate continue to provide us with opportunities to develop and grow our business.

The Group will report its interim results for the half year ended 30 September 2013 on 20 November 2013.

HS2 discussions

We continue to make progress with securing an agreement with HS2 for the relocation of our Birmingham hub and expect confirmation by the Secretary of State for Transport to be received shortly. We hope to be in a position to provide a full update on our plans at the time of our interim results.

- Ends -

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All financial information in this announcement is sourced from UK Mail's unaudited management accounts. Statements made in this announcement that look forward in time or that express UK Mail's management's beliefs, expectations or estimates regarding future occurrences are "forward-looking statements" within the meaning of the United States federal securities laws. These forward-looking statements reflect management's current expectations concerning future events and actual results may differ materially from current expectations or historical results.

Notes to Editors:

The UK Mail Group is the largest independent parcels, mail and logistics services company within the UK, offering innovative delivery solutions both locally and worldwide. The Group has a national network of 50 sites and 2500 vehicles enabling it to offer business customers a unique integrated service with a full range of time-sensitive and secure delivery options for parcels, letters and pallets.

Forward-looking statements

All financial information in this announcement is sourced from UK Mail's unaudited management accounts. These are before taking account of any exceptional items, impairments, or other non-recurring items which would only be decided upon at the time of the formal review of the interim results. Statements made in this announcement that look forward in time or that express UK Mail's management's beliefs, expectations or estimates regarding future occurrences are "forward-looking statements" within the meaning of the United States federal securities laws. These forward-looking statements reflect management's current expectations concerning future events and actual results may differ materially from current expectations or historical results.