An Post: COVID-19 to have material adverse impact on mail volumes
An Post 2019 results show 3rd year of profit and revenue growth as business transformation delivered but the company expects a material decline in revenues during 2020 because of the impact of COVID-19.
The results for 2019 show like-for-like profits up 40% on prior year and like-for-like revenue up 2%. Pre-tax profits increased by 147%, from €26.8 million to €66.3 million , helped by the sale of the One4all GVS business which delivered €40 million profit (excluded from the like-for-like comparison). By the year-end An Post had positive cash on its balance sheet of €143 million .
The results for 2019 show good progress against the Company’s transformation strategy. In 2016, advisers forecast that An Post would lose €110 million annual loss in 2019, absent changes. The Company developed a transformation strategy in 2017 which has delivered a €150 million turnaround in annual profitability.
Commenting on the financial results David McRedmond, CEO, An Post said: “In 2019 we accelerated the transformation of An Post. The focus on e-commerce saw parcel volumes up 30% over the prior year and the Post Office network is replacing traditional revenues with new products and financial services. Operating costs are shifting into the new areas of growth and the business is strongly cash positive. Management, staff, the unions and the Board have worked together to accelerate the transformation of An Post from an old world of letters and cash into a new world of e-commerce delivery and financial services.
“Our plan for 2020 is for rapid digital development across all services, the move to a new HQ, and the launch of the long-term strategy based on sustainable goals. However, COVID-19 has changed all our lives. An Post is currently solely focused on delivering an essential service across both its networks to serve the people of Ireland and to assist Government. While we expect a negative financial impact from mail volume decline (as many businesses not currently mailing) only partially offset by strong parcel growth, the strengthened balance sheet underpins the Company. The men and women of An Post, together with the Communications Workers’ Union, are determined to deliver on our core purpose: To act for the Common Good”, he concluded.
Peter Quinn, Chief Financial Officer, An Post said: “The financial results for 2019 are extremely positive and have built on the encouraging result in 2018. This, along with the disposal of assets, enables the Group to execute the strategic plan that is bearing fruit. The company will withstand the COVID-19 crisis and return to its Strategic Plan to continue the success of the business”.