bpost: the pandemic has accelerated the transformation of the company
bpost has said its fourth quarter 2020 results are in line with expectations, delivering on full year 2020 guidance through strong development in Parcels & Logistics and supported by solid last mile operations in Belgium.
Fourth quarter 2020 highlights
- Group operating income at EUR 1,194.4m, +7.2% compared with the same period last year, fully driven by continued strong performance in Parcels & Logistics Europe & Asia and North America.
- Group adjusted EBIT at EUR 60.5m (margin of 5.1%). Group reported EBIT at EUR -5.7m, due to EUR 62.1m of impairment charges on Press and Retail and International Mail.
- Business mix shift is further evidenced through combined adjusted EBIT contributions of the Parcels & Logistics businesses (EUR 36.4m) exceeding Mail & Retail adjusted EBIT (EUR 34.3m) for the third consecutive quarter.
- Mail & Retail adjusted EBIT at EUR 34.3m (6.5% margin), down by -33.3% from COVID-19 impacts on Advertising Mail and Proximity and convenience retail. Reported EBIT at EUR -15.5m, impacted by EUR 49.1m of impairment charges on Press and Retail. Underlying mail volume decline at -11.8% driven by less advertising campaigns due to non-essential retail lockdown in November 2020.
- Parcels & Logistics Europe & Asia adjusted EBIT at EUR 22.4m (7.1% margin), up EUR 8.6m. Reported EBIT at EUR 21.7m. Positive EBIT margin development is driven by elevated parcels volumes handled through the mail network. Parcels B2X volumes up +67.4% year-over-year, positively impacted by the November 2020 lockdown and end-of-year peak.
- Parcels & Logistics North America adjusted EBIT at EUR 13.9m (3.3% margin), up EUR 3.3m is fully driven by E-commerce logistics. Excluding the EBIT impact of the ransomware attack (EUR -9.2m), adjusted EBIT would have more than doubled to amount to EUR 23.1m, fully driven by operating leverage in E-commerce logistics and cost containment. Reported EBIT at EUR -1.7m, impacted by EUR 13.0m of impairment charges on International Mail (The Mail Group). Full year 2020 Total Contract Value (TCV) stood at USD 1,188.4m, largely exceeding the full year target.
- Adjusted group net profit for the full year came in at EUR 200.9m. Reported group net profit stood at EUR -19.2m, due to the impairment loss recognized on the remeasurement to fair value less costs to sell of bpost bank (EUR 141.6m) and impairment charges on Press, Retail and International Mail (EUR 62.1m).
François Cornelis, Chairman of the Board of Directors, commented: “While the COVID-19 pandemic was harmful to society, it has accelerated the transformation of the company into an e-commerce service provider. The year results confirm the potential of the adopted strategy and the confidence of the board in our capacity to serve society and reward our shareholders.”
Jean-Paul Van Avermaet, CEO of bpost group: “Our FY20 adjusted EBIT came in at EUR 280.6m, fully in line with our commitment to realize at least EUR 270m. We thank our committed employees, who have made considerable efforts to guarantee the continuity of our operations, in difficult circumstances. They have served our customers worldwide in the best possible way. Mail and Retail was impacted by a second national COVID-19 lockdown in Belgium in November, resulting in pressure on mail volumes and proximity retail. Our Parcels and Logistics businesses on both sides of the Atlantic continued to benefit from strong e-commerce development over the quarter.”
“For the full year 2020, within the challenging context of the pandemic we witnessed an unprecedented growth in our domestic parcels volumes and our international e-commerce activities, which progressively led to a shift in EBIT contribution by business unit. This strengthens our strategic vision CONNECT 2026 to accelerate our transformation into an e-commerce group close to our society, while remaining an efficient mail provider in Belgium.”
“By delivering on our ambitions for CONNECT 2026, and building on the recent development of our Parcels & Logistics activities, we expect our group adjusted EBIT for 2021 to be in the range of EUR 265-295m, broadly in line with 2020 where, despite all challenges faced, COVID-19 had a net positive contribution to the result.”