Austrian Post H1 2023 Results

Austria Post

Austrian Post has announced a revenue and earnings increase in the first half of 2023.

H1 revenue growth in Parcel & Logistics and Retail & Bank

  • Revenue +6.0 % to € 1,284.8m
  • Mail –0.2 % to € 598.1m
  • Parcel & Logistics +9.9 % to € 628.4m
  • Retail & Bank +41.3 % to € 76.5m

H1 Group earnings with strong improvement in Retail & Bank

  • EBITDA +5.3 % to € 189.0m
  • EBIT +4.6 % to € 95.2m
  • Earnings per share +36.0 % to € 1.13

Cash flow and balance sheet

  • H1 operating free cash flow of € 115.5m
  • Total assets as at 30 June including bank99 of € 5.3bn

Outlook for 2023

  • Targeted Group revenue growth in the mid-single-digit range
  • Earnings (EBIT) target remains close to the prior year level 

The first half of 2023 was characterised by challenging conditions. Economic developments and the ongoing high inflation rate continue to impact Austrian Post’s business model. This applies particularly to higher costs for energy and purchased services as well as increased staff costs alongside a weaker economic environment as reflected in the subdued consumer confidence. “Our performance in the first half year is in line with our expectations,” says CEO Georg Pölzl. “However, we succeeded in growing revenue as well as earnings thanks to the necessary cost and price discipline,” he added.
Group revenue totalled € 1,284.8m in the first half of 2023, implying a rise of 6.0 %. The Parcel & Logistics Division showed a 9.9 % revenue increase to € 628.4m. Business in Türkiye continued to be negatively impacted by inflation and currency effects. Nevertheless, the company managed to generate higher revenue in all regions. The Mail Division reported a slight revenue decline of 0.2 % to € 598.1m in the first half year 2023, with the rise in conventional letter mail in contrast to a decrease in the direct mail business. The Retail & Bank Division generated strong revenue growth of 41.3 % to € 76.5m due to the improved interest rate environment for banks. Austrian Post’s Group revenue in the first and second quarters of 2023 was considerably affected by the exchange rate of the Turkish Lira. Accordingly, the first quarter benefited with revenue increasing by 10.5 %, whereas the second quarter was negatively impacted, showing an increase of only 1.6 % mainly due to currency effects in line with hyperinflationary accounting.
Despite the ongoing challenges, Austrian Post reported an improvement in its key financial indicators for the first half of 2023. EBITDA increased by 5.3 % to € 189.0m and earnings before interest and taxes (EBIT) rose 4.6 % from € 91.0m to € 95.2m. EBIT reported by the Mail Division totalled € 77.6m in the first half of 2023 compared to € 82.9m in the previous year. The earnings reduction is attributable to the ongoing volume decline and cost increases in all areas which could be only partially offset by postal rate increases. EBIT achieved by the Parcel & Logistics Division equalled € 36.3m in the first half of 2023 compared to the prior-year figure of € 45.5m. This decrease can be attributed to positive special effects amounting to € 10.9m in the previous year in connection with Aras Kargo (in particular the option valuation relating to the increase in Austrian Post’s stake in the company). The Retail & Bank Division showed a strong earnings improvement, recording an EBIT of € 1.1m in the first half of 2023, up from minus € 20.4m in the prior-year period. In this regard, a significant contribution was made by the positive development of the financial services business of bank99 based on the improved interest rate environment. All in all, second-quarter EBIT of the Austrian Post Group was down from € 51.4m to € 48.2m due to the above-mentioned positive special effects of € 10.9m in the second quarter of 2022. The profit for the period climbed from € 54.8m to € 78.6m in the first half-year 2023, corresponding to improved earnings per share of € 1.13 in contrast to € 0.83 per share in the previous year.
In the second half of 2023, the economic environment in Europe will continue to be characterised by high inflation, restrained consumer behaviour and a limited investment activity. Austrian Post will adapt its product and pricing portfolio for conventional letter mail items effective 1 September 2023. Both business and private customers will be able to choose between the cheaper ECO letter with two to three working days delivery and the faster PRIO letter with next working day delivery. In turn, this will enhance freedom of choice and ensure reliable delivery quality. The Group maintains its performance targets for the 2023 financial year and expects to achieve revenue growth in the mid-single-digit range and earnings (EBIT) at about the same level as last year.
The investment programme of Austrian Post to ensure sustainability and growth is also a top priority in 2023. The focus is on expanding parcel logistics capacities in Austria as well as the sustainable vehicle fleet to enhance e-mobility. Austrian Post is very well positioned to maintain delivery quality and speed for parcels in Austria at a high level even in the case of increasing volumes due to the scheduled completion of the Logistics Centre Vienna in the autumn of this year. “In the interest of customer orientation, the performance of our services and our leading role in sustainable logistics are at the centre of our actions,” CEO Georg Pölzl concludes.

Source: Austrian Post