NZ Post improved net profits fourfold in the half-year ending December 2019 as parcel volumes grew strongly in the pre-Christmas peak season.
The postal operator today announced a half year result of a net profit after tax of NZ$31 million, due in part to a record-breaking Christmas delivery season for parcels. This compared with a NZ$7 million profit for the same period the previous year. Half-year revenue increased by NZ$20 million as the company delivered an average of 218,000 parcels a day over the period.
“NZ Post has delivered 34 million parcels for the six months to 31 December 2019. We’re proud to have played an essential role in delivering Christmas for Kiwis and businesses, with independent testing showing that we made 97% of our courier deliveries on time,” said CEO David Walsh.
“This strong performance is reflected in our net profit for this period of NZ$31 million – an increase of NZ$24 million compared to last year,” he added.
Walsh emphasised: “NZ Post is primed to continue maximising the growth and opportunities that eCommerce brings, especially in the fast-growing business-to-consumer market. We are continuing to look to invest for the future. This coming year will be important as we plan to meet the opportunities of eCommerce and start to invest for growth.”
But he noted: “While there’s no doubt that the growth in profit generated from parcel delivery is good news, NZ Post continues to manage the challenge of a declining number of letters being sent.” Letter volumes dropped by 11%, resulting in a NZ$5 million fall in letter revenues.
The CEO underlined: “Providing a physical mail service for New Zealanders that meets the needs of both rural and urban New Zealand, and organisations that send a lot of mail, is part of NZ Post’s DNA – but it must be financially sustainable on its own. We will be taking a methodical and planned approach to this. We are keeping our shareholder, the Government, fully informed.
“As we look ahead, we continue to juggle the opportunity of a growing parcels business and planning for further growth, with the challenge of fewer letters, the declining revenue from this service and the cost of running it. We are also mindful that the second half of the financial year is typically softer, and this year comes against a backdrop of uncertain global trading conditions.”
