Austrian Post achieves 70% boost in earnings

Austrian Post said today it’s “on the right track”, after recording an 11% growth in earnings before tax and a 2.9% increase in overall revenues for the first half of this year. Overall turnover was up to EUR 1.14bn for the six months, while pre-tax earnings were up to EUR 81.3m.

Growth was lead by parcel and logistics, which saw a 70% increase in pre-tax earnings and a 6.2% increase in revenue, while for the mail division there was a 10% rise in pre-tax earnings and a 2.1% growth in revenue.

Substitution of letters by electronic communications was offset by growth in self-service mail products and advance purchases of a new line of postage stamps, Austrian Post said.

Good economic growth in Austria has also helped with addressed and unaddressed advertising mail volumes.

Restructuring efforts have seen sales falling 6.2% in Austrian Post’s branch network compared to the first half in 2010, but the network’s earnings before tax rose 34%.

Austrian Post is converting more of its post offices into third party-operated facilities – with 456 more partner-provided post offices in its network in the past year. There are now 1,212 partner-run post offices in the network of 1,876 postal service points.

“The first half of 2011 proceeded very satisfactorily for Austrian Post. We are on the right track, pursuing our strategy of offsetting declining letter mail volumes by generating growth in the parcel business and advertising mail,” commented CEO Georg Pölzl.

“In the mail and parcel segments we succeeded in maintaining our market leadership position and continuing our development in other markets.”

Looking ahead, Austrian Post said it was expecting revenue growth to continue in the back-end of 2011 at a rate of around 2.9%, with expectations that the 11% margin seen in the first half would continue towards 11 or 12%.

Pölzl also noted the continuing importance of Austrian Post’s sustainability initiatives, saying: “Our current Austria-wide initiative ‘CO2 neutral delivery’ is also in line with this approach to pro-actively support each of our customers demanding ecologically sustainable logistics services. Thus, key cornerstones of Austrian Post’s corporate strategy are the efficiency improvements and adjustments carried out as a response to the continuing changes in the market environment.”

Austrian Post’s staff costs fell EUR 6.1m during the first half, as the overall workforce was cut by 786 to 23,250 employees, but transportation costs pushed up non-staff operating costs 7.2% to EUR 360.3m.