Country sheet: Sweden – Main developments in the postal sector (2006-2008)
Country sheet: Sweden – Main developments in the postal sector (2006-2008)
Read MoreTag: Sweden Post
Posten – Sales advance despite weakening economy
Posten interim report January-June 2008
– Net sales totaled SEK 15,595m (15,062)
– Operating earnings totaled SEK 1,165m (1,388)
– A strong financial position put the equity-assets ratio at 39pct (36pct)
– On June 18, the Swedish parliament adopted the government’s proposal to merge Posten with Post Danmark, and on June 12 the Danish parliament approved the merger
– Lars G Nordström was appointed new President and CEO
Posten’s net sales increased 4pct, mainly as a result of the acquisition of Tollpost Globe. Posten Logistics experienced organic growth of 9pct, while net sales increased 24pct including Tollpost. Stralfors’ operations in information logistics and graphics reported growth of 11pct. However, net sales for Posten Messaging fell again in the second quarter, decreasing a total of SEK 192m, or 2pct, during the first half of 2008. It is uncertain how much of a slowdown the economy will undergo and how that will affect the volumes in Posten’s core operations. However, we predict the negative trend in volumes will continue, mainly in mail operations as substitution accelerates. We are also encountering intensifying competition from international players in all core operations and across all markets where we are active.
Operating earnings totaled SEK 1,165m, SEK 223m less than for the same period the preceding year. Weaker operating earnings were attributable to lower sales for Posten Messaging and to increased costs of transportation and personnel.
1 USD = 6.37877 SEK
Read MoreDoes a liberalized postal market need a sector specific regulator?
For different reasons, most actors in liberalized postal markets call for sector specific regulatory bodies. However those should disappear over time along with an increasingly market-oriented definition of universal services.
Sector specific regulation in the postal sector has rarely been questioned so far. However, with the total opening of the European market now foreseen between 2011 and 2013, and in some countries already in place, we should think again.
To recall the context, specific regulation in the postal sector is an invention of the European Community back in 1997. The regulation was a copy of what at that time had already been set up for the telecommunications sector. Indeed the Postal Directive (97/67/EC) required every member country to set up a postal regulator. The regulator’s main functions were: firstly to make sure the Universal Service Obligation (USO) and corresponding quality criteria are fulfilled; and secondly to watch on possible cross-subsidies resulting from the monopoly, which in turn was designed as a means to finance the USO.
Abolition of postal monopoly
With the new Postal Directive of the European Community (2008/6/EC), the monopoly will be abolished in 2011 with exceptions granted to some member countries in 2013. Finland, Germany, Sweden and the United Kingdom have already abolished (at least de jure) their monopoly protection, while the Netherlands delayed full market opening because of continuing barriers to entry in Germany. Outside the European Union, Switzerland might open its postal market completely to competition by 2012, while Canada thinks on deregulating outbound mail.
Read MoreStrengthened Posten grows with improved profitability
Posten has continued to deliver strong financial results throughout 2007. Operating
earnings improved by 38 pct to total almost SEK 2 billion. These are the best earnings
from the core business in Posten’s 371-year history. At the same time, sales increased by
7 pct, totaling approximately SEK 30 billion. This shows that we have succeeded, already
during the first year of our new operational structure, in carrying out our focused
efforts to reduce costs and increase income by clearer specialization and increased
customer focus.
1 USD = 6.30871 SEK
The strong 10 pct growth of Posten Logistics is solid proof that we have been successful
in standing up to increasingly tough competition to strengthen our position on the
market. With additional acquisitions in Finland and the establishment of the distribution
network MyPack in Norway, Posten Logistics has created the conditions for a more
unified logistics concept on the Finnish market and broadened its offer for distance
trading, and has increased its total capacity on the growing Nordic logistics market.
By successfully integrating Posten’s printing operations and winning important
deals, Stralfors has grown by a full 31 pct within information logistics. At the same
time, Stralfors has both streamlined the business with divestments of non-core businesses, and has created new growth opportunities, especially for Graphic Solutions
aimed toward the pharmaceutical industry.
Distance Selling Today (2007) in Sweden
Distance Selling Today (2007) in Sweden
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