bpost records 20% profit growth in 2013

Solid growth in e-commerce and associated parcel volumes, including a bumper festive season, helped Belgium’s bpost boost profits by 20% in 2013, according to latest figures. The postal operator majority-owned by the Belgian government saw its net profit in the final quarter of the year increase by 78% compared to last year’s fourth quarter.

Overall, revenue remained fairly flat for the last quarter and the full year, as domestic mail volume declined by 4.1% in the fourth quarter (adjusted for election mailings) and 4.2% in the 2013 year as a whole, and with state subsidies down, but with prices increased.

Domestic parcel volumes grew by 8% in the fourth quarter, with the month of December showing 12.9% year-on-year growth.

In the fourth quarter, revenue grew by 0.6% to EUR 640.9m, with net profit up by 78% to EUR 52.7m.

The full year saw revenue up 0.5% compared to 2012, to EUR 2.43bn, with underlying net profit up by 20% to EUR 273.3m.

Bpost said its profit growth was helped by cost-cutting and productivity improvement measures, which progressed ahead of expectations, bringing in more than EUR 20m in savings in the fourth quarter.

During the fourth quarter, the decline in advertising mail volumes of 5% was an improvement on the 7.3% drop in the third quarter, but bpost said it was too early to tell if this was a trend resulting from an improving economy.

bpost said its international mail revenue was down 7.7% in the 2013 year, including a drop of more than EUR 4m in the fourth quarter alone, as a result of the company’s strategy to withdraw from contracts offering poor profitability. The international parcel business fared better, with a EUR 13.7m increase in revenue thanks to the acquisition of US firm Landmark Global.

“Disciplined”

Looking ahead, the Belgian national postal service said it has planned its 2014 based on an assumption for a 5% decline in domestic mail volumes, but the company fully expects parcel volume growth this year to surpass that seen in 2013.

As a result, the company said it was confident of maintaining its profitability levels this year.

Johnny Thijs, bpost’s outgoing chief executive, said he was happy with the firm’s performance in a “difficult” economic climate.

“I’m happy that the disciplined execution of our strategy again resulted in an improvement of boost’s profitability in 2013,” he said.