Britain's Royal Mail reported a better-than-expected profit for the financial year, as tight cost controls more than made up for losses due to high competition in the UK postal market.

The former postal monopoly said adjusted operating profit before transformational costs rose 5 per cent to £742 million in the year ended March 27. Analysts on an average were expecting £727 million, according to a company-compiled consensus.

Royal Mail handled 3 per cent fewer addressed letters in the year, a smaller decline than it had forecast, largely due to the return of direct delivery volumes, it said on Thursday.

Reuters