Growth at Post Italiane despite falling mail volumes

Poste Italiane announced a rise in net profit of 12.6% for 2010 despite continuing weakness of the global economy. Consolidated net profit was up 12.6% to EUR 1.02bn, whilst total revenue grew 8.7% to EUR 21.8bn.

There was also an improvement in operating profit, totalling EUR 1.87bn (up 16.9% on 2009).

This was achieved despite postal service revenues falling 3.1% on 2009 levels – impacted by the progressive reduction in postal volumes.

The operator said Postepay prepaid cards were up 21.5%. PosteVita saw a record turnover of EUR 9.5bn, up 34%, whilst PosteMobile’s operating profit stood at EUR 9.5m, up 218.5 %.

The Group’s consolidated financial statements have been approved by a meeting of Poste Italiane’s Board of Directors, chaired by Giovanni Ialongo.

The operator said results were “thanks to its operating performance, reflecting its commitment to boosting efficiency and keeping a tight control over costs”.

Results were described as “significant”, given that it was achieved against a backdrop of continuing economic weakness, making it increasingly difficult to maintain current levels of profitability.

“The result also confirms the fact that the Group’s performance has been driven by its ability to innovate over the last ten years, modernising its processes and extending the range of products and services on offer,” Poste Italiane said.

A major contribution to the result was provided by the positive performance of Insurance Services, which saw the value of premiums written rise to EUR 9.5bn from EUR 7.1bn in 2009, marking growth of 34% on the previous year.

Massimo Sarmi, CEO, said: “Improvements across all indicators and strong profit growth show that the Group was capable of turning in a good performance even in a difficult year such as 2010, and despite the progressive decline in postal volumes.

“This was achieved thanks to our ability to launch a continuous stream of innovative products and services and to successfully enter new markets.

“The Group’s strength and the excellent results reported in these financial statements give us grounds for optimism as we prepare to face the challenge presented by postal market liberalisation.

“I would like to stress that 2010 not only saw us achieve excellent results, but also take on a leading international role, acting as advisor to many countries in the Mediterranean area and in eastern Europe. As a result, we are helping them to introduce new technologies into their logistics and postal networks and with the introduction of financial and digital communication services, where we are leading the way in Europe”.

Financial Services witnessed a slight reduction in revenues (down 0.4% or EUR 18m) compared with 2009, a year that, however, benefited from an exceptional inflow into postal savings products.

Income from current accounts (EUR 2.6bn, up 1.7% on 2009) performed well thanks to increased income from the investment of deposits (up 4.2%), which rose as a result of both a 3.5% increase in average deposits (EUR 34.7bn in 2009, compared with EUR 35.9bn in 2010), and positive returns on the investment in securities of the postal current account deposits of private customers.

The number of Postepay cards in circulation also rose strongly, increasing 21.5% compared with 2009 and confirming our market leadership with 6.8m cards issued.

The Poste Italiane Group raised its international profile in 2010, entering into a large number of technology cooperation agreements.

“The resulting partnerships are proof of the Company’s ability to establish networks and contribute to developing the logistics and postal infrastructures of other countries by sharing its business model and its experience in the field of technological innovation.

“Poste Italiane now exports its know-how to Russia, Egypt, Albania and Lebanon and is partnering postal service providers in Argentina, Saudi Arabia, the United Arab Emirates, Morocco, the Netherlands, San Marino, Chile and the Vatican City,” a statement said.

With premiums written of EUR 9.5bn (EUR 7.09bn in 2009), Poste Vita, the Group’s insurance company, achieved record turnover in 2010, achieving growth of 34% compared with 2009 and increasing its market share by around two percentage points to nearly 11%.

In its first nine months in operation, Poste Assicura, the Group’s non-life company, which has been operating since 1 April 2010, made “excellent progress”: a total of approximately 179 thousand policies were sold and total inflows, well distributed among the various product lines, amount to around EUR 24.7m.

PosteMobile reached breakeven point in 2010. The company reported an operating profit of approximately EUR 9.5m, marking an improvement of 218.5% on 2009, when the company made an operating loss of around EUR 8m. The company has so far sold a total of 2m SIM cards.