Good profitability and increased revenues lead to earnings of more than NOK 1 billion for Norway Post

The Norway Post Group’s preliminary results for 2004 show earnings before tax of NOK 1,079 million, up NOK 623 million from 2003. This development is due both to increased revenues and successful efficiency initiatives
Skrevet av: Elisabeth Gjølme
“The result for 2004 shows that Norway Post has developed a profitable postal organisation that is ready to meet full competition from 2007. We have restructured operations by developing Norway Post’s strengths, extending our range of services by combining electronic information and physical distribution, and have made us more capable of resistance,” says Norway Post chief executive Kaare Frydenberg.

Growth and development

Norway Post’s revenues for 2004 increased by 15.5 per cent to NOK 17 975 million. Over the last five years turnover has risen by 37 per cent.

The acquisition of Nor-Cargo in 2004 yielded significant growth in the logistics area. In addition, the parcels market experienced growth of 4.2 per cent as a result of a rise in e-commerce. Logistics accounts for 33 per cent of Norway Post’s revenues, compared with 24 per cent in 2003.

The total letter volume for the year fell by 2.6 per cent. The volume of A and B mail has decreased by 6.8 per cent compared with the previous year. Since 1999 the volume of A and B mail has fallen by 24 per cent due to the transition to new electronic alternatives. Communications account for 51 per cent of Norway Post’s revenues.

Banking services offered through Norway Post’s sales network account for 5.4 per cent of Norway Post’s turnover. The number of banking transactions decreased by 5.6 per cent in 2004, while the sale of savings and loan products fell by 3.2 per cent. Norway Post’s agreement with DnBNOR/Postbanken expires in 2005.

Over the last year ErgoGroup has streamlined its operations and divested non-strategic areas. Turnover fell by NOK 278 million in 2004, to NOK 2 622 million, partly due to the sale of ErgoBluegarden and ErgoEnet. Operating profits before depreciation (EBITDA) amounted to NOK 415 million, compared with NOK 480 million in 2003. From 2005 ErgoGroup has reorganised and will focus on providing a total, integrated range of services within electronic solutions, business solutions and administrative solutions. IKT operations also contribute significantly to the totality of services offered. The volume of new orders at the beginning of 2005 is good.

Good profitability and return on equity

Earnings before tax (EBIT) were NOK 1 136 million, compared with NOK 512 million in 2003, yielding a net operating margin in 2004 of 6.3 per cent, as against 3.3 per cent in 2003. Return on capital employed (ROCE) before non-recurring items was 19.6 per cent, representing an improvement from 6.2 percent in 2003. Norway Post has thus satisfied the owner’s requirement concerning return on equity.

Increased revenues per full-time equivalent

Norway Post’s workforce totalled 21 222 man-years at the end of 2004. Adjusted for 1 239 full-time equivalents in Nor-Cargo, the workforce has 1 957 fewer full-time equivalents than in 2003. Turnover per full-time equivalent is NOK 778 000, based on operating revenues over the last twelve months, up from NOK 686 000 per full-time equivalent in 2003. In 1999 turnover per full-time equivalent in Norway Post was NOK 483 000.

Improved service

Norway Post’s strategy is to develop the company as a leading service provider, based on fulfilling the licence requirements. In 2004 service has been improved through increased availability, and reduced waiting times at post offices. 26 Post in Shop units were established in 2004. At year-end the sales network consisted of 328 post offices and 1201 Post in Shop units – a total of 1 529 sales outlets.

Norway Post’s delivery quality, measured as a percentage of A-priority mail delivered overnight, remained stable at 87.5 per cent in 2004, in line with the previous year’s level and well above the licence requirement of 85 per cent. Since 1999 delivery quality has increased from below 80 per cent.

For additional information, please contact:

– Elisabeth H. Gjølme, Senior Vice President Information, tel. +47 901 40 449
– Birgitte Lund Nakken, Press Officer, tel. +47 908 88 284
– or Norway Post’s 24-hour media contact: +47 23 14 80 00
– See also
– Receive news (in Norwegian) from Norway Post by SMS: Send POSTVARSEL to 1960. Each received news message costs NOK 1.

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