Austrian Post “on right track” as innovation helps up profits 4.6%

Austrian Post said yesterday that it appears to be “on the right track”, after net profits rose 4.6% in 2011 on the back of growth in mail and particularly parcels. The national postal operator said compared to 2010, its revenue increased above-target on a comparable basis by 4.2%, to EUR 2,349m, while net profit grew to EUR 123m.

Sales grew by EUR 56.3m or 4.4% in the group’s mail division and by 5.6% in its parcel and logistics division’s EUR 846.5m sales, both partly driven by e-commerce growth, although letter mail and direct mail segments also showed “good development”.

Although substitution of letters by email is continuing in Austria, the company said e-commerce is now shifting volumes from the parcels category more into the letters services, helping with revenues in the mail unit.

The “sound” state of the Austrian advertising industry is also helping with addressed and unaddressed letter volumes, although expectations are for a general 3-5% decrease in overall letter volumes to continue this year.

Revenue in the post office network fell 3%, however, although there were two less working days in the calendar. Austrian Post is restructuring its branch network to increase the number of partner-run outlets, which increased from 1,117 to 1,258 during the year.

Commenting on its latest financial results, the company said 2011 had proceeded “very satisfactorily” even after complete liberalisation of the Austrian postal market at the beginning of the year.

The group saw “very satisfactory” development of its business in Austria and in Eastern Europe, but performances in the German and Benelux markets were below expectations. Austrian Post recently sold off its trans-o-flex operations in Belgium and the Netherlands to Dutch postal operator PostNL.

Innovation

Austrian Post CEO Georg Pölzl said the improvements in the mail and parcels divisions had come as the result of offering more innovative services to customers.

Recent innovations have included new two-tier business mail services and new drop-off and collection boxes for parcel services.

He said: “The new option to choose between ‘Premium” and ‘Economy’ letters as well as the positive development of business parcels and advertising mail show that we can also offer the solutions that businesses demand, even in a challenging market.”

This year, Pölzl said his company would continue efforts to develop innovative services tailored to customer needs.

Last month Austrian Post launched a new “Kuvert” (Envelope) service for advertising mail designed to “tidy up letter boxes”, in which direct mail materials are bundled into a single package for households. The launched followed successful pilots in 2011.

Pölzl said: “We are also investing in innovative self-service systems such as the drop-off and pick-up boxes. These have been successfully rolled out in urban areas following test operations carried out in 2011.

“All these solutions have one goal in mind: greater flexibility and simplified services for customers,” added the Austrian Post CEO.