Austria Post CEO on H1: we have succeeded in growing both sales and earnings

Despite the ongoing challenges, Austrian Post was able to record an improvement in its key earnings figures in the first half of 2023

Revenue growth H1 in Parcel & Logistics and Branch & Bank

• Revenue +6.0% to EUR 1,284.8m
• Mail –0.2% to EUR 598.1m
• Parcel & Logistics +9.9% to EUR 628.4m
• Branch & Bank +41.3% to EUR 76.5m

Consolidated result H1 with strong improvement in Branch & Bank

• EBITDA +5.3 % to EUR 189.0m
• EBIT +4.6% to EUR 95.2m
• Earnings per share +36.0% to EUR 1.13

Cash flow and balance sheet

• Operating free cash flow H1 of EUR 115.5m
• Total assets as of June 30 including bank99 at EUR 5.3 billion

Outlook 2023

• Sales growth in the mid-single-digit range targeted
• Earnings (EBIT) remain at the previous year’s level

The first half of 2023 was characterized by challenging conditions. Economic developments and persistently high inflation continue to have an impact on Austrian Post’s business model. These are mainly the increased costs for energy, purchased services and personnel, but also a weaker economic environment, manifested by subdued consumerism. “The development in the first half of the year is in line with our expectations,” says CEO Georg Pölzl. “With the necessary cost and price discipline, we have succeeded in growing both sales and earnings,” Pölzl continued.
 
The Group’s revenue in the first half of 2023 amounted to EUR 1,284.8m (+6.0%). The Parcel & Logistics Division recorded revenue growth of 9.9% to EUR 628.4m. Business in Turkey continued to be impacted by inflation and currency effects, but it was possible to achieve an increase in sales in all regions. In the first half of 2023, the Mail Division recorded a slight decline in revenue of 0.2% to EUR 598.1m, with an increase in the traditional mail business offset a decline in direct mail. The Retail & Bank Division generated strong revenue growth of 41.3% to EUR 76.5m as a result of the improved interest rate environment for banks. The Group’s sales in the first and second quarters of 2023 were significantly influenced by the exchange rate of the Turkish lira: While the first quarter benefited positively with growth of 10.5%, the second quarter with an increase of 1.6% was mainly negatively impacted by currency effects in accordance with hyperinflation accounting.
 
Despite the ongoing challenges, Austrian Post was able to record an improvement in its key earnings figures in the first half of 2023. EBITDA increased by 5.3 % to EUR 189.0 million and earnings before interest and taxes (EBIT) rose from EUR 91.0 million to EUR 95.2 million (+4.6 %). The Mail Division generated EBIT of EUR 77.6m in the first half of 2023, compared with EUR 82.9m in the previous year. The decline is due to the steady decline in volumes and cost increases in all areas, which could only be partially offset by tariff measures. The Parcel & Logistics Division generated EBIT of EUR 36.3m in the first half of 2023, compared with EUR 45.5m in the previous year. This decline is attributable to positive one-off effects in the previous year in the amount of EUR 10.9m in connection with Aras Kargo (mainly option valuation, increase in shares). The Retail & Bank Division recorded EBIT of EUR 1.1m in the first half of 2023 after minus EUR 20.4m in the previous year, thus showing a strong improvement in earnings. The positive development in bank99’s financial services business, based on the improved interest rate environment, made a significant contribution to this. Consolidated earnings (EBIT) for the second quarter changed from EUR 51.4m to EUR 48.2m. In the second quarter, the previous year’s result included the above-mentioned positive one-off effects of EUR 10.9m. Net income for the period increased from EUR 54.8m to EUR 78.6m in the first half of 2023, resulting in improved earnings per share of EUR 1.13 compared to EUR 0.83 in the same period of the previous year.
 
In the second half of 2023, the economic environment in Europe will continue to be characterized by high inflation, restrained consumer behavior and limited willingness to invest on the part of companies. As of September 1, 2023, Austrian Post will adapt its product and price portfolio for traditional letter mail. Not only business but also private customers can then choose between the cheaper ECO letter with a transit time of two to three working days and the faster PRIO letter with delivery on the next working day. This ensures freedom of choice and reliable delivery quality. For the 2023 financial year, the company maintains its ambitions and expects a mid-single-digit increase in consolidated sales in 2023 and consolidated earnings (EBIT) for the full year 2023 at the previous year’s level.
 
The Group’s investment program to ensure sustainability and growth will continue to be a high priority in 2023. In particular, the focus is on expanding capacity for parcel logistics in Austria and expanding the sustainable vehicle fleet in the direction of e-mobility. With the completion of the Vienna logistics centre in autumn of this year, Austrian Post is very well positioned to maintain the delivery quality and speed of parcels in Austria at a high level, even with growing volumes. “In terms of customer orientation, the performance of our services and our role as a pioneer in sustainable logistics are at the heart of everything we do,” concludes Georg Pölzl.