PostNL “on track to achieve full year 2015 outlook”
PostNL has reported revenues of €1,058 million for the first quarter of 2015, up from €1,033 million for the same period last year. However, the underlying cash operating income was down by around 12% to at €68 million and net cash from operating and investing activities was down from €23 million to €21 million.
The volume of “addressed mail” (letters) fell by more than 13%, while parcel volume increased by 8%.
The company also announced that it had achieved €15 million of cost savings, and said that the results “reconfirmed” an expected full year underlying cash operating income between €280 million and €320 million.
Herna Verhagen, CEO of PostNL, commented: “Our performance in the first quarter is in line with our expectations. In Mail in the Netherlands, price increases and cost savings did not fully compensate for the volume decline. The volume development corresponds with fluctuations that come with substitution and phasing in working days. For the full year we expect volume decline to be within the earlier guided range of 9% -12%. Cost savings are expected to be higher in the second half of 2015 due to phasing in the implementation of the restructuring plans.”
Verhagen continued: “Our financial position developed positively with net cash in line with Q1 2014 and an improved equity position. The application of a pension liability ceiling in the accounting of our pension obligation significantly reduces the further sensitivity of our equity position for lower interest rates.”
The PostNL CEO said that the company supported FedEx’s intention to buy TNT Express, which would have “an additional positive impact” on PostNL’s financial position when completed. (PostNL currently has a 14.7% stake in TNT Express, but last month signed an irrevocable undertaking with FedEx in support of the offer.)
Verhagen added: “We regret that the joint venture in the United Kingdom did not succeed.” This was a reference to the news that LDC, the private equity business within the Lloyds Banking Group, has decided not to work with PostNL on the future development of Whistl.
Concluding her statement, Verhagen said: that “continuous regulatory uncertainties” in the countries in which PostNL operates have led the company to launch a strategic review of its activities abroad.
