Slovenska Posta postal company earns Q1-Q3 profit

State-run postal company Slovenska Posta has earned SKK 380 billion in profit over the January-September period, up SKK 1.1 million y/y. The company reported favorable development mainly in revenues which rose after increasing charges for domestic and international postal services and an intensification of postal services. Over the first nine months of this year, Slovenska Posta reported revenues of SKK 4 888 billion. The company expects to close the current year with balanced economic performance and a profit of about SKK 320 million, said Milan Smehyl, member of the Slovenska Posta strategy team at the 2nd postal conference held on Tuesday in Stara Lesna in the High Tatras.

Revenues from production activities favorably influenced the company’s economic performance, where the growth rate reached 125 17%. On the other hand, revenues from procurement activities slightly dipped from 2002 showing a 98.54% growth index. Costs in the monitored period reached SKK 4.508 billion, which is SKK 521.4 million more than in the same period of last year. Mainly an increase in the prices of energy, materials, services and wage costs were behind the rising costs.

In 2004 the company expects to earn profit between SKK 350 million and SKK 400 million, added Mr. Smehyl. Investments are planned at about SKK 220 million.

Slovenska Posta aims to remain the leader in all postal services on the local market. The company’s strategic plans strive to reach a profit of SKK 500 million in 2005 by motivating its employees with a higher than average wage. In order to achieve this target the company must undergo transformation into a joint stock company, said Mr. Smehyl. The company’s transformation is expected on May or July next year.

Slovenska Posta, employing a staff of 17,200, is one of the biggest employers in Slovakia. Transformation of the company will also involve laying-off about 700 employees in 2004. According to Mr. Smehyl, personnel costs represent the largest item in the overall costs in the company. He said that in 2004 the Slovak postal company would increase the price of mail services, which the

company plans to offset by reducing prices of other product. (€1 = SKK40.958 on November 25)