If the item does reach you then as you have the money and the item, one has to go.
You can cancel the order citing Problem with Buyer's Address this will fully refund them, they will be refunded everything they have paid you, and your seller performance is not affected.
I'm afraid with the ' loss' of cost of packing materials, ( how much did you use for a £1 item?), if you wish to you can add the loss to the starting price of another item you list in the future.
@traceybed10