THE Royal Mail has made record profits of £537m, triggering a bonus of more than £1,000 for 180,000 postal workers.

The state-owned operator also revealed that first-class mail deliveries were the best in a decade, while the number of letters being lost have been cut by half in the past year.

Chairman Allan Leighton said postmen and women had achieved a fantastic turnaround and would now benefit from one of the biggest profit shares with employees in UK corporate history.

Every worker will receive £1,074, amounting to £218m of the Royal Mail's profits.

The Royal Mail was losing more than £1.5m a day before it launched a renewal plan three years ago. It has turned this around to making £2m a day profit.

Quality of service to customers hit the best levels in a decade, with 92.8 per cent of first-class mail being delivered on time between January and March, 0.3 per cent above the target.

The number of letters lost fell from 28 million to 16 million, with 99.92pc of mail arriving safely.

Income reached a record £8.96bn, while a record 84 million letters a day were handled, one million more every day than the previous year.

But Post Offices lost £110m and executives warned that the future of the network rested on the ability to sell a growing range of products and services.