Posti reports record parcel volumes for Q4
Finland’s Posti has reported that it saw record parcel volumes in the fourth quarter (Q4) of 2017.
In a statement issued today (1 March), Posti said that the combined parcel volume of Finland and the Baltic countries increased by 11% in October-December, with 18% of this growth coming from consumer (B2C) parcels.
For 2017 as a whole, the combined parcel volume of Finland and the Baltic countries increased by 9%, with 12% of this growth coming from B2C parcels.
The Posti Group’s net sales for 2017 were €1,647.0m, up 2.5% on 2016, but EBITDA was down at €118.6m compared to €126.7m in 2016.
In its “operational highlights” for the year, Posti flagged up the construction of its new 26,000 m2 freight terminal on Suokalliontie in Vantaa, which is scheduled to be completed in summer 2018, and the Parliamentary decision that the Finnish State can decrease its ownership in Posti Group Corporation, but its share of ownership must remain at 50.1%.
“With a separate decision by the Government plenary session,” added Posti, “49.9% of the ownership of Posti Group Corporation can be transferred to Vake Oy, a state-owned development company, with the other 50.1% remaining in the State’s direct ownership.”
Commenting on the results, Heikki Malinen, President and CEO, said: “In many ways, 2017 was a significant milestone for Posti on our path of renewal. The Postal Act reforms that entered into force last year promote the goal of extending the life cycle of traditional communication, while the new two-year collective agreement and the reform of early-morning delivery provide long-term stability in a period when the business environment is undergoing a difficult transformation. Our quality program and the renewal measures we implemented during the year lifted the quality in our operations as a whole to a high level. Our performance during the crucial Christmas season was excellent, and we hit daily, weekly and monthly volume records in parcel deliveries.
“Last year, we also took significant steps in the development of our businesses and services by updating our strategy. Since 2013, Posti has systematically shifted its focus to our core activities, namely mail and logistics services. The cornerstones of our strategy now consist of four key goals: win e-commerce play, keep mail relevant to customers, renew service culture, and digitally powered to secure your service delivery.
“The past year was very encouraging in highlighting how the new strategy presents Posti with broader growth opportunities in parcel and logistics services as the transformation of commerce goes on and consumer behavior continues to change. Strong growth in e-commerce saw us deliver about 37 million parcels in Finland last year, more than ever before. Consumer parcel growth was 12% and international parcel growth was 19%. Another positive sign was the freight volume increasing by 8%. We estimate that the volume of e-commerce will continue to grow in Finland this year by approximately 10%, and we will open new Posti Parcel Lockers to support this growth.
“The Group’s net sales increased by 2.5%, driven by parcel and logistics services. Also worth noting was that the adjusted operating result of Mail, Parcel and Logistics Services showed a substantial year-on-year improvement in the fourth quarter. The Group’s adjusted operating result for the full year was EUR 42.4 million.
“In spite of the divestment of operations, Posti’s capital expenditure for the year remained high at EUR 73 million. We will continue to invest in digital services, increased automation and improving the competitiveness of our core business. One example of these investments is the new freight terminal in Vantaa. It will be the largest freight terminal in Finland and it is scheduled to be completed in 2018 at a cost of more than EUR 30 million. Relying on its comprehensive delivery and terminal network, Posti will enhance its capacity to provide services to the grocery, consumer goods and food production industries. Acquisitions remain a potential avenue for implementing the strategy, but only if they strengthen the Group’s core business.
“We carried out restructuring measures in the OpusCapita segment during the year by divesting the Finance and Accounting Outsourcing business and transferring the sending of documents and invoices as well as OpusCapita’s digitizing operations in Finland to Posti’s Mail, Parcel and Logistics Services segment. OpusCapita will focus on global solutions for sourcing, payment and cash management.
“In the Itella Russia segment, we will continue to increase operational efficiency in order to improve profitability. Itella Russia is moving in the right direction, with net sales increasing by 5% in October–December and adjusted EBITDA amounting to EUR 1.6 million.”
