Royal Mail rattles investors with warning of rising competition

250px-Royal_Mail.svgLONDON, May 22 (Reuters) – Newly privatised Royal Mail pointed to tougher times ahead on Thursday as it said competition in parcels was intensifying and warned the emergence of a rival British mail delivery service threatened its growth prospects.

The blunt reference to the headwinds it is facing took the shine off a 12 percent rise in full-year profit for the company, which remains embroiled in a political storm over its privatisation, sending its shares down 6.7 percent as the day’s biggest faller in the blue chip FTSE 100 index.

Royal Mail’s growth prospects continue to split analyst opinion, with differing views over its ability to manage declining letter volumes and increasing competition, at the same time as growing its parcels business and cutting costs.

Read more: UPDATE 2-UK’s Royal Mail rattles investors with warning of rising competition | Reuters.