Russian Post improved profits by 57% last year thanks to rising revenues, including from parcelsand express, as well as higher productivity, and continued to invest in modernisation.
Last year, the Russian postal operator generated revenues of RUB 105.4 billion (€2.58 billion),a 9.5% rise on 2009. The net profit soared 57% to RUB 480 million (€11.75 million).
Postal services accounted for 41% of revenues, 37% came from financial services, 2% from expressdelivery and 20% from retail and other services. Similar to the previous year, traditional servicesgrew well. First-class letters generated 35% revenue growth and 30% volume growth, express deliveryby EMS Russian Post showed revenue increase of 56% and volume growth of 41% while financialservices grew with volumes of received payments increasing by 26%.
Russian Post said that it also strengthened its position on a number of highly competitivemarkets in 2010. For example, its share on the domestic express market rose to 20% while its marketshare in the segment of financial payments increased to 22%. The organisation is now ranked number14 in Russia for financial services.
In 2010, Russian Post started a series of new commercial projects, including a new financialproduct ‘Forsage’ for urgent transfers. As part of its project ‘Mobile mail’, Russian Post has alsostarted to sell mobile phones. This includes receiving payment for mobile communication andinternet, registration of contracts with mobile operators as well as selling prepaid cards.
Last year’s investment rose 60% to RUB 8.1 billion (€198.34 million), 13% of which was used forcreating a network of automated sorting centres. Another 29% was invested in modernisation oftechnological and information-communications infrastructure and equipment upgrade respectively. Afurther 11% was invested in upgrading the company’s fleet und modernising logistics while theremaining 18% was spent on restructuring post offices.
Meanwhile, to keep up with rising volumes in international express mail, Russian Post has openedits first specialised office of international postal exchange at Sheremetyevo Airport in Moscowthis year. Its estimated processing capacity amounts to 100,000 shipments per month. The new officewill help optimise the logistics scheme of handling EMS shipments and is expected to reducedelivery times by one day on average. The new office is currently being tested. From Februaryonwards, EMS flows coming from abroad will be redirected to it.
Russian Post also plans to open a new international postal exchange office at the other end ofthe country in the Primorsky Krai region (around Vladivostok) bordered by China, North Korea andthe Sea of Japan. The office will focus on handling international EMS shipments from China, Korea,Hong Kong, Japan and the US West Coast. In view of the strong economic growth in Southeast Asia,which accounts for 40% of the overall EMS import volumes, the Far East office will improve thecompany’s logistics and reduce delivery times significantly.
Looking ahead, Russian Post expects its revenues to grow by 12% to RUB 118.2 billion (€2.89billion) this year. The employees’ productivity and the average salary are also expected toincrease by 17% and 12% respectively. The company also plans to increase investment by 73% to RUB14 billion (€342.86 million) this year and focus on four main areas. These comprise construction ofautomatic sorting centres, modernisation of post offices and logistics as well as implementation ofinnovative technologies.
This year, the postal operator will start preparations for transforming Russian Post into ajoint-stock company and continue working on the project for creating a postal bank for Russia. Theorganisational structures of the company are also to be transformed with key activities to beseparated into individual business units to increase business development efficiency.
Russian Post CEO Alexander Kiselyov commented: “The key to our success in 2010 was theintroduction of a balanced tariff policy, implementation of new services, development of marketingcommunication, increased efficiency in customer service and upgrade of the technological base ofservices. In 2011, we will continue developing towards modernisation and broad implementation ofinnovations across all business areas, diversifying business, and improving service quality andcustomer service.”
