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Home Archive Significant improvement in financial results for Posten Norge

Significant improvement in financial results for Posten Norge

Posten Norge significantly improved its financial results in the first quarter of 2017. Profitability in both the mail and logistics segments has increased.

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Posten og Bring resultat

The improvement is due partly to more business days compared to the first quarter of last year, but the Group has also made significant cost reductions in operations. This has more than compensated for the negative financial impact of fewer addressed deliveries. 

 "It is gratifying to be able to present improved financial results for the first quarter. The Group is focusing on achieving lower costs and greater profitability. In the future we will also simplify our operations and reduce organisational complexity," says CEO Tone Wille in Posten Norge. 

Better logistics results

The logistics segment increased its profit (EBITE) in Q1 2017 by MNOK 73 compared with the same period in 2016. This was mainly due to more business days, new sales, cost reductions and the phasing out of unprofitable freight operations in Sweden. High growth in online shopping volume and increased home delivery in Sweden and Denmark also contributed to profitability improvements. The Group's e-commerce volume was up 15 per cent.

"Even though Q1 showed an improvement in financial results, we still need to increase profitability in the logistics segment. Furthermore, we’re preparing to step up the pace and momentum in our work on digital innovation based on new customer needs. The key focus here is digitalisation of work processes, tools and customer service," says Wille. 

Faster restructuring

In the first quarter, addressed mail volumes fell by 7.6 per cent in Norway, but when adjusted for number of business days the decline was 12 per cent. 

 "The mail segment has delivered a good financial result in Q1 despite a significant decrease in volumes. In a digital era where customer needs change quickly, we need to restructure faster and more often. The postal service offering must be adapted to a dramatically changed market situation. This requires political decisions, and that Posten Norge is provided with a predictable framework for granted government procurements of commercially non-viable postal services," says Wille.

 The government has allocated MNOK 177 for government procurements of commercially non-viable postal services for the 2017 fiscal year. The allocation is MNOK 316 lower than the projected requirement for 2017.

New ambitious environmental goal

Posten Norge has already met the goal of reducing its greenhouse gas emissions by 40 per cent from 2008 to 2020. Now the Group has set a new goal: Posten and Bring – renewable by 2025.

 "This means that the Group will work toward using renewable energy sources in its own vehicles and buildings, provided that new technologies are competitive with fossil solutions when they are to be used on a large scale. I'm proud of this. It commits us to being the most forward-looking postal and logistics group in the world," says Wille.
 

Highlights Q1 2017 (Q1 2016)

Revenue: MNOK 6 094 (6 199)

Adjusted profit (EBITE): MNOK 191 (18)

Operating profit (EBIT): MNOK 203 (25)

Cash flow from operating activities: MNOK 127 (77)

Return on invested capital (ROIC): 11.2 per cent (6.8)