Royal Mail today revealed a 72% plunge in half-year profits after its letters business slumped into the red.
Further declines in the number of letters posted in Britain saw the letters division report losses of £66 million in the six months to September 26 against £48 million profits a year earlier.
The group said the average postbag is now at a level not seen since the mid 1990s, with letter volumes falling to around 68 million a day - a drop of 16 million in the past five years.
Royal Mail's overall operating profits dropped to £52 million from £184 million as it said the group continued to suffer increased competition from rivals as well as the use of email, websites and social media.
Today's figures come a month after the Government announced Royal Mail was to be privatised. It is pushing the Postal Services Bill through Parliament to enable private capital to be injected and will take on Royal Mail's £8 billion in pension liabilities to smooth the path for privatisation.
A Department for Business spokesman said: "These results really bring home the need for the action.
"Letter volumes have fallen by 5% in six months and Royal Mail continues to lose money. The situation is not sustainable and that is why we are pressing ahead with our plans."
But the privatisation plans continue to face stiff opposition from the Communication Workers Union (CWU).
Billy Hayes, general secretary of the CWU, said: "Today's results are the strongest argument yet for keeping Royal mail publicly owned and fully integrated.
"Overall there was a group profit and the quality of service has been maintained - would anyone expect a private company to provide the universal service and good quality of service in this context?"