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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.
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