Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

NZ Post half year results 2017/18

NZ Post half year results 2017/18 - Ongoing and accelerating letter decline challenges

• Nearly 38 million fewer letters were delivered compared to the same period last year

• Letter volumes declined by 13.8% resulting in revenue decline of $20 million

NZ Post today reported a net profit after tax from continuing operations of $6 million for the six months to 31 December 2017 (HY 2018).

The result for NZ Post’s core business (excluding Kiwi Group Holdings) was a net loss of $13 million. This can be largely attributed to a marked acceleration in letter volume decline.

New Zealand Post Chief Executive David Walsh said responding to this decline, whilst maintaining service obligations, has resulted in a very financially challenging six months.

“Our largest sending customers are increasingly moving to online communication for their own customers, as this is now what many of us expect in a digitised world.

“This is a significant challenge for NZ Post, and cannot be underestimated in terms of loss of revenue as we seek financial sustainability for this valued service.

“We did however see an increase in parcel volumes, up 9.9% on the same period the year before, with over 39 million delivered. During the Christmas period, on our busiest day we processed over 330,000 parcels, an increase of 15% from the previous seasonal record.

“The growth in parcels is evidence that our e-commerce strategy is the right one.”

Areas of focus for the second half of FY 2018 are the ongoing need to make the letters business financially sustainable, maximising the opportunities from continued growth in parcels, and furthering plans for e-commerce partnerships, Mr Walsh said.

Looking ahead, Mr Walsh said meeting the year-end financial targets would be challenging.

“The business is having to adapt to rapidly changing customer preferences and the ongoing complexity of operational transformation.

“We remain committed to ensuring we’re providing the best possible service for our customers”.

Other points of note include:

• Revenue from operations of $452 million, down 3% from the prior comparable period - attributable to the decline of letter volumes, not fully offset by growth in the parcel services

• Expenditure of $468 million, up from $446 million in HY 2017 – mostly attributable to supporting growth in parcels

• Net loss after tax from NZ Post’s core business (excluding Kiwi Group Holdings) of $13 million, a decline of $23 million on the prior comparable period

• Delivered 39 million parcels with volume growth of 9.9%, resulting in 6% increase in parcel revenue from the prior comparable period

• A total of 235 million domestic and international letters were delivered over the HY 2018

• NZI Sustainable Business Network Awards 2017 - Supreme Award Winner

• An interim dividend to the Crown of $2.5 million

Investment in Kiwibank

Kiwi Group contributed $19 million to NZ Post’s net profit after tax for the six-month period ended 31 December 2017, compared to $54 million in HY 2017. The year-on-year decline reflects the sale of 47% of Kiwi Group on 31 October 2016. In addition to its share of Kiwi Group earnings in the period prior to 31 October 2016, NZ Post recorded a gain of $25 million on the partial sale of Kiwi Group.

Summary of the NZ Post’s financial performance (including its investment in Kiwi Group)

$ millions6 months ended
31 December 2017

unaudited
$m
6 months ended
31 December 2016

unaudited
$m
Revenue from operations452467
Expenditure468446
Net profit after tax from continuing operations*622
Share capital192192
Total equity1,2901,382

* Continuing operations represent NZ Post’s core business plus its 53% share of Kiwi Group earnings from 1 November 2016 to 31 December 2016 and from 1 July to 31 December 2017. Revenue from operations and expenditure in both the current and prior year no longer include revenue and expenditure from Kiwi Group’s operations.


ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Stats NZ: Consents For New Homes At All-Time High

A record 41,028 new homes have been consented in the year ended March 2021, Stats NZ said today. The previous record for the annual number of new homes consented was 40,025 in the year ended February 1974. “Within 10 years the number of new homes ... More>>

Stats NZ: Unemployment Declines As Underutilisation Rises

The seasonally adjusted unemployment rate decreased to 4.7 percent in the March 2021 quarter, continuing to fall from its recent peak of 5.2 percent in the September 2020 quarter but remaining high compared with recent years, Stats NZ said today. ... More>>

ALSO:

Digitl: The Story Behind Vodafone’s FibreX Court Ruling

Vodafone’s FibreX service was in the news this week. What is the story behind the Fair Trading Act court case? More>>

Reserve Bank: Concerned About New Zealand's Rising House Prices

New Zealand house prices have risen significantly in the past 12 months. This has raised concerns at the Reserve Bank of New Zealand – Te Putea Matua about the risk this poses to financial stability. Central banks responded swiftly to the global ... More>>

Westpac: Announces Strong Financial Result

Westpac New Zealand (Westpac NZ) [i] says a strong half-year financial result has been driven by better than expected economic conditions. Chief Executive David McLean said while the global COVID-19 pandemic was far from over, the financial effect on ... More>>

MYOB: SME Confidence In Economic Performance Still Cautious

New insights from the annual MYOB Business Monitor have shown the SME sector is still cautious about the potential for further economic recovery, with two-in-five (41%) expecting the New Zealand economy to decline this year. The latest research ... More>>