Royal Mail has announced a dip in revenue expectations from its parcels business as a result of intensifying competition in the account, consumer/small and medium-sized enterprise and export channels.

Revenue from parcels dropped by one per cent in the three months ended June 29th 2014 and including the period from March 31st 2014 to date.

Despite the slump in this area of the business, Royal Mail says it anticipates its overall performance will be in line with full-year expectations due to cost control measures and good performance in letters.

"Our parcels revenue will be dependent on our performance in the second half, which includes the Christmas trading period, and on no further weakening in our addressable UK parcels market," said Royal Mail's chief executive officer Moya Greene.

In addition to aggressive pricing practices by other carriers, Royal Mail Group said its parcels business had been affected by changes to Amazon's minimum order level for free delivery and expansion of its own delivery network.