The Post Office is to be given an extra £370 million by the government, after the postal service announced it had made a profit for the first time in to get 16 years.

The money will be used largely to protect Post Office services in rural areas, as well as to modernise the existing 11,600 Post Offices. The Government has already committed £2 billion to the group since 2010, with £160 million of this round going towards rural branches and £210 million to modernise services.

Business Secretary Greg Clark announced the extra funding on Wednesday, saying the Post Office was “at the heart of communities across the UK, with millions of customers and small businesses relying on their local branch every day to access a wide range of important services”.

He said: “With the network at its most stable in decades, this £370 million of government funding will ensure it can continue to modernise and bring further benefits to customers across the UK.”