Austrian Post improved profits last year despite stagnant revenues and has sold off itsloss-making German direct marketing subsidiary Meiller GHP to Britain’s Paragon Group.
The Austrian postal group said in an announcement yesterday ahead of full results on March 12that it achieved “solid” business results in 2014 and met its profit targets.
In line with the existing outlook, the company reported stable revenue development, with afractional 0.2% rise to €2,371 million. The revenue trends of the first three quarters continued inthe fourth quarter.
The announced earnings objective of further improving group operating profits was also achieved.According to preliminary figures, EBIT rose 5.9% in last year to €197 million. However, whereas theoperational development of the mail and parcel businesses showed a continuation of the trendsprevailing in previous quarters, earnings in 2014 were also impacted by various special effects.
On balance, the preliminary group profit for the period in 2014 rose to €147 million from €124million in 2013. However, the previous year was impacted by a negative effect in the financialresult related to the German-based joint venture Meiller GHP.
This company, a joint venture between Austrian Post (65%) and Swiss Post (65%), declaredinsolvency in February 2014 but continued to trade following a restructuring. However, the twoowners sold the firm, part of the Meiller Group, to UK-based Paragon Group Ltd earlier thismonth.
Meanwhile, Austrian Post’s Mail & Branch Network Division registered a 1.5% revenue declineduring the year to €1,488 million. The decrease in the mail business was due to the ongoing trendtowards electronic substitution of letters and declining direct mail volumes. At the same time,revenue from branch network services also fell in 2014.
This was more than compensated by the Parcel & Logistics Division, which generated a revenueincrease of 3.1% to €882 million in 2014. From a regional perspective, the division showed a slightrevenue drop in the highly competitive German market. In contrast, a significant top-line increasewas achieved in Austria and in South East and Eastern Europe.
The sale of Austrian Post’s former corporate headquarters located on Postgasse in Vienna’s innercity to the Soravia Group was a positive special effect which led to operating income of €62million from the transaction.
At the same time, other negative special effects had an impact on the 2014 results. The Germansubsidiary trans-o-flex is in the midst of a restructuring process as a consequence of the highlycompetitive market environment. The related write-downs and structural measures as well as theimpairment loss on goodwill (non-cash) led to a negative earnings effect totaling €49 million.Impairment losses of €10 million were also recognised for Austrian Post’s mail subsidiaries in theCEE region.
