UK Mail Releases Interim Results - November 19, 2009 [Press Release.]Highlights:
. Group revenues down 3.2% to £188.2m (2008: £194.5m)
. UK Mail revenues up 5.6% to £84.6m (2008: £80.1m)
. Group profit before tax up 18.6% to £7.0m (2008: £5.9m)
. Net cash at period end of £3.6m (2008: net debt £1.9m)
. Interim dividend of 6.4p per share (2008: 6.4p)
Guy Buswell, Chief Executive of UK Mail, said:
“Our first half performance has been robust, despite the market challenges.
We have taken more cost out of our distribution network, already one of the most efficient in the industry. This, together with new business wins and innovative new products coming on stream, has increased profit by 18.6% despite a slight revenue reduction. Our financial position is also strong, with net cash at the period end.
Our strategy is to leverage our low-cost network in order to build competitive advantage and drive profitable revenue growth. By bringing new products and services to market, we aim to increase both the size of the market available to us and our share of that market.
Whilst market conditions for the balance of the year remain hard to predict, trading in recent weeks has been in line with our expectations, with minimal overall impact from the recent mail strikes. We therefore remain confident about the outcome for the full year, and about UK Mail Group?s longer-term prospects.”
Austrian Post Q1-3 2009: Revenue Decline of 3.4 percent - November 13, 2009 [Press Release.]Highlights:
- Ongoing difficult market environment in 2009: Postal services
negatively impacted by recession and electronic substitution
- Group revenue Q1-3 down 3.4%, or EUR 61.4m
- Downward trend continues in Q3: revenue declines 3.2%, or EUR 18.6m
- Volume decline in letter mail and international parcels business,
but growth in Austrian parcels volumes
- Efficiency enhancement and cost reduction measures have a positive
effect: Savings in staff costs and operating expenses
- Earnings before interest and tax (EBIT) in Q1-3 decreases by 9.0% to
EUR 93.7m EBIT in Q3 down 12.8%
- Focus on costs, cash flow and a solid balance sheet structure
- Operating cash flow before changes in working capital in Q1-3 of
EUR 128.4m (minus EUR 33.4m)
- Free cash flow before the acquisition/sale of securities only EUR 20.5
below the previous year
- Balance sheet: surplus of cash and cash equivalents compared to
financial liabilities
- Georg Pölzl assumed office as CEO on October 1, 2009
Austrian Post at a glance
Developments during the first three quarters of the 2009 financial year show that the economic downturn has also had a negative impact on the business operations of Austrian Post. Letter mail and parcel delivery volumes are dependent on the overall market development, consumption patterns of the population and advertising expenditures of companies. Many companies are trying to achieve cost savings also in respect to postal costs, which has negative consequences on delivery volumes and prices for Austrian Post. Accordingly, total revenue of Austrian Post fell by 3.4% in the first nine months of the 2009 financial year, to EUR 1,723.2m. Group revenue declined in the third quarter by 3.2%, to EUR 567.3m.
Revenue in the Mail Division decreased considerably, falling 4.5%, which can be attributed to the economic downswing as well as the e-mail substitution of letters. Similarly, the Parcel & Logistics Division also recorded a drop in revenue (- 2.4%) as a result of recession-related price pressure on an international level. In contrast, the parcel business in Austria developed very positively, registering significant volume growth driven by the new customer Hermes. In the Branch Network Division, lower internal sales reflect the current structural change: prior to market liberalisation, letters are being increasingly picked up from large customers. As a result of these changed customer requirements and the recession-related decrease in mail and parcel delivery volumes, it is absolutely essential to adapt the structure of the branch network and increasingly rely on partner-operated postal service points.
The top priority of Austrian Post is to implement cost reduction measures as a means of counteracting this loss of revenue. Various measures have been initiated in order to sustainably cut staff costs as well as operating expenses. Austrian Post succeeded in compensating for the extensive salary increases in 2009, which were based on the high inflation rate of the previous year, by taking advantage of employee fluctuation and thus reducing its total staff by more than 1,000 employees. Net savings in operating expenses of EUR 12.0m were also achieved.
In the first three quarters of the 2009 financial year, earnings before interest and tax (EBIT) fell 9.0% from the previous year, to EUR 93.7m. Third-quarter EBIT was down by 12.8%. For the year 2009 as a whole, the current economic environment and the cost-cutting measures implemented by Austrian Post’s customers are expected to continue having a negative impact on delivery volumes of postal services. A fundamental improvement in the overall economic situation is not anticipated at the present time.
“On the basis of the ongoing difficult environment for providing postal services, it is important for me to carry out all possible measures at our disposal, both in terms of revenues as well as reducing costs, in order to optimally cope with this market situation”, says the new CEO Georg Pölzl.
TNT Q3 Results: Sharp Focus On Cost And Cash Continues To Pay Off - November 2, 2009 [Press Release.] Highlights:
Group
" Cash flow remains strong; full-year cost-savings targets reaffirmed
" Profit from continuing operations 102 million euro, 10% blow Q3 2008 Express
" Quarter-on-quarter improvement in Express volumes and weight per consignment
" Continuing success in achieving cost savings: 128 million euro in Q3 2009, 368 million euro year to date
" Underlying operating income of 77 million euros (99 million euros in Q3 2008) Mail
" Addressed mail volume decline in the Netherlands 4.8% i line with trend
" Strong Master plan savings of 24 million euros in the quarter
" Operating income in line with Q3 2008 CEO Peter Bakker comments:
In this quarter the trading environment has stabilised further with some early signs of positive underlying developments. With Q3 being the low volume season, the EBIT of both our divisions is at a satisfactory level.
The rate of decline of Express volumes has modestly improved. In particular, the average weight per consignment developed positively for the first time in a year, while price pressure remained. At the same time, our people continue to deliver on cost.
Mail achieved a solid result helped by strong Master plan savings in the quarter. Discussions with our unions to find ways of achieving necessary cost savings are ongoing.
TNT is optimally positioned to take advantage of a possible economic upturn but also needs to be prepared for continued harsh economic conditions and therefore remains focused on achieving its aggressive cost and cash control targets.
Norway Post: Enhanced Efficiency Improves Profitability - October 30, 2009 [Press Release.]Norway Post's revenues are declining as a result of the economic slump and electronic substitution, but extensive efficiency measures are leading to greater profitability at the end of the first three quarters of 2009.
The earnings before non-recurring items and write-downs came to NOK 647 million during the first three quarters of 2009, compared to NOK 345 million for the same period last year. The operating revenues amounted to NOK 20.1 billion, compared to NOK 20.8 billion at the end of Q3 2008.
The main reasons for the improved profitability are that the Spinnaker programme, which is intended to improve efficiency, has produced positive results and that the Norwegian state has paid for mandatory, unprofitable services in accordance with the licence conditions. As at 30 September 2009, government procurements of NOK 369 million were recorded in the books.
The Spinnaker effect - NOK 800 million
The Spinnaker programme was implemented in 2008 and consists of a number of measures to reduce costs and increase revenues in the Group. The measures are primarily intended to meet the challenges involved in the decline in volume and changes in customer behaviour in the traditional mail sector. The transition to electronic mail is leading to a permanently lower volume of letters, sharp fall in banking transactions and considerable decline in the number of those visiting post offices.
As at 30 September 2009, the effect of the Spinnaker measures equals around NOK 800 million. In the three first quarters of 2009, the effect equals around NOK 563 million.
«With the Spinnaker efficiency programme, we have so far succeeded in improving the efficiency of our operations and adapting our costs to the lower volumes of letters. The economic slump is also affecting the Logistics and IT activities, so that the efficiency programmes have been extended to also cover these parts of our operations,» says Dag Mejdell, the CEO of Norway Post.
Declining volumes of mail - improved quality
The volume of letters was in total 13.5 per cent lower as at 30 September 2009 than on the same date in 2008. Unaddressed advertising fell by 17.5 per cent while A and B mail fell by 8.6 per cent during the first three quarters of this year.
«Electronic substitution is leading to a permanent reduction in volume and changes to our customers' requirements. We expect the volume of letters to continue falling and that the amounts we lose to electronic messaging will not find their way back to Norway Post,» says Mr Mejdell.
In Q3 2009, Norway Post delivered 89.2 per cent of the A mail overnight, compared to 88.7 per cent in Q3 2008. This is well above the licence requirement of 85 per cent.
The economic slump is affecting Logistics and IT operations?
The generally lower level of activity in the economy is also affecting the development of revenue and earnings in the Logistics segment. In total, the operating revenues fell by three per cent during the first three quarters of 2009. Lower volumes and subsequent declining capacity utilisation levels had a negative effect on profitability. A number of measures have been implemented to compensate for this trend. Further adaptations are being considered in line with developments in the economy.
The revenues of the IT segment (ErgoGroup) fell by six per cent during the first three quarters of 2009, mainly due to a sharp slump in the Swedish market. Measures have been introduced to reduce the costs in the IT segment, but these are not expected to have any effect on the results until 2010.
So far this year, ErgoGroup has won a lot of new contracts and entered into contracts worth NOK 2 136 million during the first three quarters of 2009. This is NOK 136 million more than during the same period in 2008.
Swiss Post: Gratifying Result Thanks To Good Third Quarter - October 30, 2009 [Press Release.]In the first three quarters of 2009, Swiss Post generated Group profit of 553 million Swiss francs. This is an increase of around 11.5% compared with the same period last year. The rise is due primarily to successes chalked up by PostFinance. The mid-year result had shown a 16% drop from 12 months previously.
Between January and September 2009, Swiss Post generated Group profit of CHF 553 million (2008: CHF 496 million). This represents an increase of CHF 57 million or 11.5% compared with the same period in 2008. The improvement is attributable mainly to the success of PostFinance, which lifted its unit result by 76% to CHF 351 million (2008: CHF 199 million). In addition to the above-average growth in new customers and customer deposits, the much smaller scale of writedowns required was responsible for this increase. Two other units, Swiss Post International and PostBus, also improved their results.
Compared with 2008, operating income fell by CHF 160 million (2.5%) to CHF 6,310 million. Almost all Group units posted a decline in earnings. At PostMail, this decrease was accentuated by the implementation of price cuts for letters on 1 July 2009. Three quarters of the operating income (around 75%) was generated by Group units PostMail, PostLogistics and PostFinance. Investments came to CHF 257 million, some CHF 43 million below last year’s figure. In the past nine months they were again financed completely by resources generated by Swiss Post itself.
Economy compounding declining letter volumes
The decline in letter volumes is continuing unabated: from January until September, Swiss Post carried 4.9% fewer addressed letters than in the same period of 2008. The economic crisis has reinforced the decline resulting from substitution (replacement of physical mail with electronic means of communication) and dispatch optimization (bundling of items). Parcel volumes remained largely stable. Swiss Post reacted to the shrinking volumes by adapting its organizational structure and human resources.
Owing to the persistently difficult economic situation and the effects of price cuts in the letter segment, Swiss Post is expecting the result for the year as a whole to be lower than that of last year.
Q2 revenue rose 7.9%; net profit up 8.3%
The Group’s revenue increased 7.9% to S$130.3 million in the second quarter, boosted by
the consolidation of revenue from Quantium Solutions Group (formerly known as G3
Worldwide Aspac group of companies) (“Quantium Solutions”), which became wholly-owned
since May 2009. On a comparable basis with the same quarter last year, the Group’s
revenue would have registered a decline of 4.5% without the consolidation of Quantium
Solutions.
Mail revenue decreased 4.4% to S$87.6 million on lower international mail contributions.
Logistics revenue increased 142.6%, benefiting from the first full quarterly contribution from
Quantium Solutions, although revenue from Speedpost saw a decline. In Retail, revenue
remained relatively steady.
Rental and property-related income continued to grow, rising 23.1% to S$10.1 million, with
higher rental income from Singapore Post Centre and the leasing of space at the repurposed
post office buildings.
The Group’s total expenses increased 10.8% to S$94.4 million in the second quarter, due
mainly to the consolidation of Quantium Solutions. Excluding Quantium Solutions, Group
expenses would have declined 4.0%. Labour and related expenses rose, as higher staff
base offset the benefits from the Jobs Credit Scheme. Volume-related expenses increased,
as higher costs of sales offset the decline in traffic expenses. The rise in administrative and other expenses was largely due to additional costs from Quantium Solutions and higher
professional and consultancy fees.
For the second quarter, the Group’s net profit grew 8.3% to S$40.5 million while its
underlying net profit declined by 8.6% to S$35.4 million.
Said Mr Wilson Tan, Goup Chief Executive Officer of SingPost: “Although the global
economy is showing signs of recovery, the postal industry typically experiences a longer
recovery runway. We are certainly not out of the woods yet and we continue to face
unrelenting pressures from the operating environment.”
He added: “We remain disciplined on cost management, and are focused on expanding
Quantium Solutions’ business beyond cross-border mail and extending its core
competencies in Asia Pacific. We will continue to reinvent ourselves and stay relevant to
our customers, while actively pursuing new growth opportunities.”
Review of First-half Performance
In the first half of FY2009/10, the Group’s revenue grew 4.3% to S$252.0 million as the
consolidation of Quantium Solutions offset revenue declines from Mail and Logistics.
Excluding the consolidation of Quantium Solutions, revenue in the first half declined by
5.6%.
Total expenses rose 8.2% to S$181.1 million in the first half, due to the consolidation of
Quantium Solutions. Excluding Quantium Solutions, total expenses would have declined
3.3%.
For the first half, the Group’s net profit grew 4.0% to S$79.9 million while underlying net
profit declined by 6.9% to S$72.3 million.
New Terminal Dues To Impact Singpost's Profit By 5%
[ Angela Tan, Business times
.]
Singapore Post said on Thursday that the new terminal dues starting January 1, 2010 will affect its underlying net profit by 5 per cent yearly.
'The annualised impact is estimated to be around 5% of underlying net profit,' the postal and logistic group said.
With effect from 1 January 2010, Singapore will be reclassified as a New Target Country from the current category of Developing Country by the Universal Postal Union (UPU) for the purpose of terminal dues settlements, i.e. settlements for the processing and delivery of international mail between countries.
SingPost will settle terminal dues under a new settlement structure, which will result in an increase in its net terminal dues payments for international mailing as terminal dues payable by Target Countries are generally higher.
It said the group has and will continue to take active measures to mitigate the effect.
For the second quarter ended September 30, 2009, SingPost's underlying profit slipped 8.6 per cent to S$35.41 million.
Its underlying net profit is defined as profit after tax and minority interest before one-off items and gains and losses on property, plant and equipment.
SingPost has declared an interim dividend of 1.25 cents a share, to be paid on November 30, 2009. The dividend payout is unchanged from a year ago.
Itella Interim Report for January–September 2009 - October 26, 2009 [Press Release.]Highlights:
• Itella Group's net sales in January-September 2009 fell by 4.5% to 1,328.7 million (EUR 1,391.5 million in January-September 2008). Excluding the impact of acquisitions and divestments, net sales fell by 10.9%.
• Consolidated operating profit fell by 67.5% to EUR 22.1 million (EUR 68.1 million), representing 1.7% (4.9%) of net sales. Operating profit improved in Itella Information but shrank in Itella Mail Communication and Itella Logistics.
• The volumes of mail delivered by Itella fell significantly. First class letter volumes decreased by 8% and parcels by 13%. The volume of addressed letters has been falling for a period of five years.
• Performance was burdened by the EUR 14.2 million restructuring costs related to personnel.
• An impairment of EUR 10.6 million was recorded in the goodwill of Itella Logistics' Russian operations. The long-term outlook for the Russian business remains, however, unaltered. When the economic trends begin to recover, Itella's position on the market is expected to strengthen.
• A total of EUR 94.7 million was spent on investments that focused on postal services in Finland.
• Itella introduced fully carbon-neutral Itella Green delivery services for the letters, magazines, advertisements, and parcels for corporate customers. Similar services will be available to consumers in 2010.
Jukka Alho, President and CEO:
The economic conditions reflect differently on Itella's various services. On the whole, volumes are not showing any tangible signs of the expected upswing, which means the full-year net sales and operating profit will be weaker than a year earlier.
Itella Mail Communication has been able to partly compensate for the decline in delivery volumes through productivity-boosting measures, but the full impact of these measures will only be seen in the upcoming years. Moreover, regardless of general economic trends, we must prepare for a fall in letter volumes in the future.
Itella Information has seen positive development throughout the year with its profitability moving against the general economic cycle.
Itella Logistics' volume development reflects the overall industry development. Of all our lines of business, logistics has been the most severely hit by the economic downturn. Volumes have fallen sharply in Russia, although our Russian customers are currently reserving more capacity, which improves the business outlook for the future.
UPS 3Q Results: Earnings at High End of Guidance Range; Volumes Improve Through Quarter - October 23, 2009 [Press Release.]UPS reported diluted earnings per share of $0.55 for the third quarter on $11.2 billion in revenue. A stabilizing economic environment led to improving volume trends during the quarter, while UPS's International business continued to increase market share.
The $0.55 in diluted earnings per share was at the high end of the company's guidance range of $0.45 to $0.55.
"I'm encouraged by the signs of economic recovery that are becoming apparent, although we still have a long way to go," said Scott Davis, chairman and CEO. "Ongoing strategic investment has positioned UPS to capitalize on growth opportunities around the world. We are managing operations well, while controlling costs and maintaining excellent service."
Consolidated volume for the three months ended Sept. 30, 2009, totaled 927 million packages, down 2.4% fom the same period in 2008. Average daily volume and revenue per piece declined 3.9% ad 11.3%, espectively. Operating profit decreased to $929 million as the benefits of substantial cost reductions and productivity gains were more than offset by the economic impact of lower volumes and changes in product mix.
Magyar Posta Sees Profits Exceeding Target - October 9, 2009 [Press Release.]State-owned postal services company Magyar Posta expects to close 2009 with pre-tax profit of HUF 6.2 billion, well over the HUF 4.87 billion target in the business plan, CEO Ildikó Szuts said at a press conference on the occasion of World Postal Day.
Pre-tax profit in January-August exceeded the pro rata target by HUF 1.5 billion, Szuts said.
In spite of the bigger profits, Magyar Posta expects revenue to fall HUF 5 billion under the target because of a drop in letter, package and newspaper deliveries. The fall in revenue will be offset by cost cuts, which the company made without laying people off.
In spite of the crisis, Magyar Posta is spending HUF 13 billion on investments this year. It will complete renovations at 48 post offices in 2009 and renovate another 89 over the next year and a half. The company will trade in about HUF 1 billion of its trucks for smaller, more efficient vehicles this year. It will put its employees on about 5,000 new bicycles purchased at a cost of HUF 370 million, and it will spend HUF 500 million on making post offices accessible to people with disabilities.
Magyar Posta will test about 15 automated bill payment terminals in cooperation with Erste Bank at the end of 2009 and the beginning of 2010. The terminals will be tested for 3-4 months before a decision on further developments is made.
