S&P'S affirms NZ Post Ratings
Ratings agency Standard & Poor’s has affirmed its ratings on New Zealand Post, but revised its outlook to negative because of slowing growth in its postal business.
S&P’s downgraded its outlook from stable.
NZ Post’s long-term rating of AA- is S&P’s fourth-highest rating level, reflecting its government ownership, market position and strong cash flow, said S&P credit analyst Anna Hughes.
“The negative outlook reflects the flattening growth of NZ Post’s core postal business and its changing business mix,” Ms Hughes said.
The popularity of email meant growth in letters would continue to decline, leaving NZ Post’s other businesses operating in more competitive markets to contribute a larger share of earnings.
The effect of banking subsidiary, Kiwibank, on the overall business was also increasing.
Kiwibank contributed 23 per cent of NZ Post’s net income, but its modest position in a very competitive market, and moderate profitability, detracted from the parent’s credit position, Ms Hughes said.
