Posten Norge sees increased profits for mail and logistics

Posten Norge has reported that profits for both its mail and logistics segments were up in the first quarter (Q1) of 2017. The company said the improvement was partly due to more business days compared to the first quarter of last year, but added that it had also made “significant cost reductions” in operations which “more than compensated” for the negative financial impact of fewer addressed deliveries.

Revenue was down from NOK6,199m in Q1 2016 to NOK6,094m, but adjusted profit was up from NOK18m to NOK191m.

The logistics segment increased its profit (EBITE) in Q1 2017 by NOK73m compared with the same period in 2016.

According to Posten Norge: “This was mainly due to more business days, new sales, cost reductions and the phasing out of unprofitable freight operations in Sweden. High growth in online shopping volume and increased home delivery in Sweden and Denmark also contributed to profitability improvements. The Group’s e-commerce volume was up 15%.”

Posten Norge’s CEO Tone Wille commented: “Even though Q1 showed an improvement in financial results, we still need to increase profitability in the logistics segment. Furthermore, we’re preparing to step up the pace and momentum in our work on digital innovation based on new customer needs. The key focus here is digitalisation of work processes, tools and customer service.

Addressed mail volumes in Norway fell by 7.6% compared to Q1 2016, but when adjusted for number of business days the decline was 12%.

According to Wille: “The mail segment has delivered a good financial result in Q1 despite a significant decrease in volumes. In a digital era where customer needs change quickly, we need to restructure faster and more often. The postal service offering must be adapted to a dramatically changed market situation. This requires political decisions, and that Posten Norge is provided with a predictable framework for granted government procurements of commercially non-viable postal services.”