Austrian Post balances mail volume decline with parcel growth in 2013
Austrian Post maintained its profit level on stable revenues in 2013, as election materials dampened its mail volume decline and robust parcel growth bolstered income.
The company said yesterday that it saw the result as a “good performance” against the challenges in the postal industry and logistics market.
Revenue for the year held at EUR 2.36bn, although on a like-for-like comparison overlooking the effect of selling the company’s trans-o-flex businesses in Belgium and Holland in 2012, there would have been revenue growth of 0.8%.
Pre-tax earnings (EBIT) were up 2% at Austrian Post in 2013 compared to the year before, to EUR 186m, although affected by impairment losses from the trans-o-flex divestments, but profits once taxes were taken into account edged up only 0.7% on 2012, to EUR 124m.
Commenting on the results, Austrian Post said elections and the country’s referendum on compulsory military service helped “cushion” the company’s ongoing year-on-year mail volume declines that result from communications moving online.
But, the company suggested that consolidation in the advertising market adversely affected its direct mail volumes.
The parcel business brought clear growth in both Austria and South East and Eastern Europe, but Austrian Post said its parcel revenue in Germany declined slightly.
Austrian Post’s chief executive officer, Georg Pölzl, said his company could be “satisfied” by its performance in 2013.
He explained: “The increase in revenue and earnings once again demonstrates that the strategic path we have chosen is the right one. In the future, we will also pursue growth in the parcel business and in our international business in order to compensate for declining mail volumes. In this regard, all our activities will be consistently oriented towards the needs of our customers, in order to consequently increase our service level.”
Pölzl added that 2013 had seen “extensive” investments made to assist Austrian Post’s future, including its new logistics centre in Upper Austria. These investments are set to continue with more automation and sorting technologies to help the company cut its costs.
In 2014, Austrian Post is expecting slightly improved growth, although mail volume declines will continue, particularly as new rules on official government mail switching to electronic means will start to bite.
The company is anticipating mail volume declines of between 3% and 5% in 2014. But, parcel growth of 3-6% is expected thanks to e-commerce.
Among Austrian Post’s divisions, the Mail & Branch Network saw its revenue stable, rising by 0.2% to EUR 1.51bn.
The division’s letter and mail solutions business saw its revenue improve by 1.2% year-on-year to EUR 793.7m. Mail volume declines continued, including cuts in letter volumes from telecommunications customers and the public sector. However, various elections helped with volumes, particularly with the growing popularity of the absentee ballot. Austrian Post said it also achieved some growth with new services in its Mail Solutions field.
Direct Mail revenue fell by 0.8% to EUR 441.8m in 2013, as the result of a weaker economy and a “perceptible” consolidation in the retail sector that has eaten into advertising volumes, particularly unaddressed mail.
Parcels
Austrian Post’s Parcel & Logistics division saw its revenue up 2% year-on-year, to EUR 857.3m, adjusted for the effect of trans-o-flex units in the Benelux countries being sold to PostNL in 2012.
The domestic parcel business saw its revenue up 7.8%, but the German market saw a revenue decline for Austrian Post, which operates in Germany through the trans-o-flex brand.
Austrian Post said within its parcels business, the overnight business-to-business service Premium Parcels saw a 1.1% decline in revenue to EUR 643.7m, mainly stemming from the sale of the Benelux trans-o-flex units and the decline in sales in Germany. Adjusted for the trans-o-flex effect, the business would have achieved a 1.3% year-on-year growth.
Standard parcel services saw 2.2% year-on-year growth, to EUR 181.7m, with good business from retail customers in Austria, while the company also brought in EUR 32m from added-value parcel services like fulfillment, warehousing and secure logistics, an 8.2% growth for this area.
