The New Zealand Post Group today announced better results for the half-year ending December 31,2012, with express and banking growth outweighing declining mail volumes.
The group recorded a net profit after tax of NZ$59.6 million (€46.2 million), up 68%, whilepre-tax profits rose by 79% to NZ$78.4 million (€60.8 million). Revenues increased by over 30% toNZ$872.3 million (€676.3 million), largely due to the full consolidation of the courier businessExpress Couriers Limited (ECL).
Chief Executive Brian Roche said the result was boosted by the performance of Kiwibank and theGroup’s financial services businesses. The bank performed well in a highly competitive market,particularly in the face of aggressive competition in the home loan environment.
There were mixed results across the logistics and mail businesses where logistics growth wasbalanced against a continued decline in letter volumes and revenue.
Mr Roche said ECL’s performance was very encouraging in the extremely competitive couriermarket. “ECL has performed well to increase profitability compared with the previous year. Theresult supports our decision to purchase the remaining shares in this company so as to have 100%ownership of a business providing express delivery services.” The company bought DHL’s 50%share of the former joint venture last year.
However, challenges remain for the mail business with total mail volumes falling by 8.1%, or 35million items, although tight cost management helped offset the declines in revenue.
“Thirty-five million fewer pieces of mail in the network is a stark reminder of the need forchange. New Zealand Post Group is confident it can maintain a viable and sustainable physicalnetwork if it is given the flexibility to make necessary changes in the future. Making thosechanges can still be achieved in a measured and planned manner working in the best interests of thecommunity and business. But the latest mail volume statistics are further evidence that the abilityto make the right decisions needs to be given now rather than put off,” Roche said.
Looking ahead, New Zealand Post said it should meet expectations in the full year. Despite anincreasingly competitive residential banking sector, Kiwibank has maintained strong levels ofprofitability, although further pressure is expected towards the year-end.
ECL continues to trade strongly, the group said. The mail business continues to manage thedecline in letter volumes with operational changes to ensure the business remains viable whilelonger term initiatives are implemented.
“The group remains committed to and confident of achieving the strategic goals of growing thebank and delivering a sustainable network for the future”, Roche concluded.
