An Post has bounced back into the black with an operating profit of €5.9 million last year, compared to an operating loss of €11.4 million in 2013.

Group revenues at the organisation also increased 10.9 per cent, rising from €811.7 million in 2013 to €820.6 million last year.

An increase in postal charges generated an extra €15.3 million for the organisation last year.

Mail revenue was 2.1 per cent or €10.6 million higher at €521.3 million. However, traditional mail volume contracted by 3.3 per cent in the course of the year.

An Post chief executive Donal Connell said 2014 was another year of significant challenge and change as the core company continued to adapt in order to stay relevant to customers.

“There is no doubt that mail volume decline is now well established, albeit at a slower rate and we must continue to align business strategy, including our staff numbers, with this reality,” he added.

He said government policy in relation to the role of the Post Office will be an important determinant of strategy in the coming years.

“While we continue to invest in aspects of the business that have the potential to generate revenue, the retail network faces many challenges including significant price pressure on bill payment revenues, competition from alternative payment networks and that low growth-potential of current Government business. As we have said before, we believe that An Post has a key role to play in the provision of a Basic Bank Account, in the context of financial inclusion”, he added.

During the year, Mr Connell saw his overall remuneration package fall 26 per cent from €386,000 to €285,000. This was due to a €55,000 drop in basic salary and €26,000 decline in pension contributions.

An Post said the financial shortfall in the Universal Service Obligation during 2014 was €38 million, a “substantial improvement” compared to €55 million in 2013.