Royal Mail has admitted that the threat of industrial action and the introduction of size-based parcel pricing led to volumes being flat in the first nine months of the current financial year.

In its interim management statement covering the nine months ended 29 December 2013, like-for-like turnover in its UK parcels business rose 8% due to the introduction of a new pricing model, but also led to a decline in consumer volume.

Despite seeing growth in account parcel volumes, the threat of industrial action by members of the Communication Workers Union (CWU) ahead of the Christmas peak deterred some customers from using the operator.

The secline in its letters business also continued, with volume falling 5% compared to the same period in 2012. Revenue was also down 3%.

Group turnover rose by a marginal 2%, with just over half of this coming from its parcels business.

It expects these trends to continue in the final quarter of the year, which will end on 30 March.

Chief executive Moya Greene said: "Our financial performance to date is in line with our expectations and gives us confidence that we will deliver against our key value drivers for the full year."

An agreement between the operator and the CWU has been put before staff in a ballot, which began earlier this week and runs until 5 February.

"We remained the nation's number one parcel delivery company, handling 115 million parcels in the month of December alone," Greene added.

Royal Mail will increase prices for some of its final-mile mail contracts later this year.

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