Finnish postal group Itella improved its profits last year thanks to logistics growth and mailsavings in an uncertain market environment.
Underlying operating profits grew strongly by 74 per cent to €53.2 million, representing a2.7 per cent profit margin. Reported EBIT was €39 million compared to a previous year loss of €5.9million. The company’s ongoing €100 million cost-cutting programme launched in 2011 had a positiveimpact on results.
Itella Group’s net sales grew by 2.4 per cent to €1.95 billion, with international operationsaccounting for 31 per cent. The main revenue driver was the consolidation of VR Transpoint, thelogistics business of Finnish Railways (VR) that was acquired last year.
In the October–December 2012 fourth quarter, however, underlying profits dropped 46 per centto €12.8 million and the reported result halved to €9.1 million. Sales increased 4.7 per cent to€542.6 million.
President and CEO Heikki Malinen said: “The development trend in Itella’s business as a wholewas largely positive during the year. We began to see the positive profit impact of the €100million cost-cutting program that we initiated in 2011. The improvement in performance wasnecessary, but we still have some way to go before achieving the target level. We will continue ourefforts to increase net sales and improve profitability as well as our cost-cutting measures.”
Itella Mail Communications, the largest division, increased sales by 1.4 per cent to €1.2billion last year, with flat Q4 revenues. Its underlying profit improved by 48 per cent to €74million. The business opened 100 new automated parcel terminals and pick-up outlets during theyear, and the number of Netposti users grew beyond 400,000 in August.
Malinen commented: “The effects of earlier measures aiming to improve productivity areclearly visible in Itella Mail Communications, the operating result of which was a clearly betterthan the year before. The rate at which electronic services are replacing letter shipmentsaccelerated at an expected pace – a trend evident in the declining volumes of letter shipments.Volumes in parcel services grew by 5 per cent.”
Itella Logistics increased revenues by 6.8 per cent to €781.5 million in 2012, including 17.3per cent growth in Q4, but the business remained in the red with an underlying loss of €9.5million.
