PostNL announce loss of €19 million over the first nine months of 2024

Highlights Q3

• Normalised EBIT of €(19) million at Mail in the Netherlands: result shows urgent need for adjustments in regulation
• Parliament disappointingly postponed decision towards future-proof and financially viable postal service and requires further actions by PostNL
• Parcel volumes increased by 7.4% (September exit rate 10.7%), supported by accelerating domestic volume growth (September exit rate 2.7%)
• Gradual improvement in contribution from volume growth at Parcels
• High organic cost increase of €34 million, largely mitigated
• New collective labour agreements (CLAs) for PostNL and Saturday workers
• 14% further improvement in average carbon efficiency year-to-date (YTD)

CEO statement

Herna Verhagen, CEO of PostNL, said: “The urgent need to transform the current unsustainable business model at Mail in the Netherlands is clearly shown by the loss of €19 million over the first nine months of 2024, €15 million lower than last year. Underlying trends in volume decline, the shift towards non-24-hour mail and cost increases are continuing. Therefore, adjustments in the universal service obligation (USO) and a financial contribution are necessary to secure that the legal duty of the USO is not loss-making.

“Because parliament recently postponed the decision for a future-proof postal market and waits for more background information, we have to take additional actions. In addition to the previously communicated migration of non-USO mail to a standard service level of ’within 2 days’ as of 1 January 2025 we are now also considering further impactful measures, such as emptying mailboxes on the streets during the daytime instead of in the evening as well as potential further price increases for sending mail. Actions are inevitable to safeguard a future-proof and financially viable postal service that ensures predictable delivery for everyone in the Netherlands, while also providing job security to tens of thousands of people.

“At Parcels, overall volume growth is further picking up and trending well towards our full-year growth projection. Domestic volumes were up 1%, with market share remaining relatively stable. Volumes from international customers continued to grow significantly. The mix was slightly better than in the previous quarter and we anticipate further improvement going forward. We are pleased to see that the result, for the first time this year, improved compared with last year, supported by a strong performance in September after weak summer months. We are ready for the ramp-up towards peak season and put a lot of effort into optimising the balance between volume, value and capacity utilisation. Efficiency improvements, such as our initiatives to optimise our collection and transportation services as well as rationalisation of delivery options, are gaining momentum. Coupled with strict cost control and supported by accelerating volume growth, these measures will strengthen our results going forward. The positive performance trajectory at Parcels is encouraging.

“For the third quarter, as anticipated, the overall result was negative, predominantly driven by the performance of Mail in the Netherlands. Parcels reported a positive, and improved, result. In the current challenging market circumstances, we remain fully focused on adjusting our operations and offerings with ongoing attention for our customers, while improving efficiency and capacity utilisation.

“Given the results so far this year and persistent volatility in economic conditions, we now expect a normalised EBIT of around €80 million for full-year 2024, in line with current market expectations. We remain fully committed to paying out a dividend that is in line with our business performance.”