Swiss Post reports “solid” income, but a decline in profit
Swiss Post has reported that it achieved a “solid” operating income of 8,188m francs for 2016, but its operating profit (EBIT) of 704m francs was 119m francs down on 2015. In a statement issued yesterday (9 March), the postal operator said that “declining consignment volumes, pressure on margins in the logistics business and the low interest environment in the financial sector” all had a “significant impact” on the 2016 performance.
“Other factors include the sale of a PostFinance participation and a reduction of the depreciation period for tenant fit-outs in logistics centres, which was necessitated by the rapidly changing economic environment in the logistics business,” said Swiss Post.
The number of addressed letters fell by 3.8%, and while PostMail still recorded an operating profit of 317m francs, this was down from 358m in 2015 . Operating income was up, from 2,820m francs to 2,906m francs.
Focusing on the parcels and e-commerce sector, Swiss Post said: “With the boom in online retail, momentum in the logistics market continues to grow. The volume of parcels processed by PostLogistics rose by 5.7% year-on-year (2015: +3.0%). PostLogistics generated an operating profit of 117m francs, down 28m francs year-on-year. This is due to the high pressure on margins in a fully liberalized market and – on the basis of a strategy revision – higher expenses arising from the transfer of product responsibility for private customer parcels from Post Offices & Sales.”
Swiss Post also looked at the steps it is taking to meet the challenging of increased digitalization.
“The replacement of traditional postal products with digital products and services continues,” said Swiss Post. “Inpayments at the Post Offices & Sales unit were down by 5.4 percent. In the past year, the operating result at Post Offices & Sales stood at –193 million francs (previous year: –110 million). At the same time, operating income fell from 1,601 million to 1,196 million francs.
“The was due to both the continuing decline in over-the-counter transactions and adjustments to the internal performance mandate. Since the announcement of the development of the postal network by 2020, Swiss Post has begun taking steps towards establishing a branch network with a broad range of physical and digital access points that are fit for the future.”
As Post&Parcel has reported previously, Swiss Post plans to expand its network of access points from 3,700 to 4,000 – but as part of this transformation it is looking to increase the number of agencies, and cut back on traditional post offices.
Swiss Post also reported that it had scored well in terms of delivery punctuality in 2016. In a statement issued on Wednesday (8 March), the operator said: “In 2016, Swiss Post once again recorded very high on-time delivery rates for letters and parcels: 98% of A Mail letters and 98.9% of B Mail letters were delivered to their recipients within the promised timeframe. For parcels, 98.1 percent of all PostPac Priority and 97.2% of all PostPac Economy consignments arrived on time. This performance exceeds the stipulations of the Federal Council.”
