UKM.L Regulatory News (UKM)

9 October 2012

UK Mail Group plc

Pre-Close Trading Update

UK Mail Group plc today issues the following pre-close trading update for the half year ended 30 September 2012.

Overall performance in the first half of the year has been satisfactory and in line with our expectations, with the trends we experienced in the first quarter continuing into the second quarter.

Reported Group revenues for the first half are expected to show an increase of some 13% compared to the same period in the previous year. Adjusting for the increase in Royal Mail prices implemented on 2 April 2012 and there having been one less working day than in the same period in the previous year, underlying Group revenues increased by some 10%.

Our Mail business continued to show good revenue growth both on an absolute and underlying basis driven by strong customer retention and new customer wins. This business remains well positioned in its market with a good pipeline of new business opportunities.

Our Parcels business again showed good revenue growth, based on continued volume increases compared to the prior year. This performance reflects the benefits of recent customer wins although we continue to see an ongoing mix change towards B2C.

Our Courier business saw a decline in revenues as expected. Our Pallets business again achieved revenue growth albeit in challenging operating conditions.

We expect the economic backdrop to remain challenging into 2013 and the pricing environment to stay competitive. We are continuing to plan accordingly, with tight control of our costs remaining a key focus. We have leading and differentiated positions in our markets, a highly competitive business model, and the Group remains in a sound financial position, all of which gives us confidence for the future.

The Group will report its interim results for the half year ended 30 September 2012 on 21 November 2012.

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Notes to editors:

About UK Mail Group plc

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