NZ Post six-month profit up 23 percent

By NZPA

Thursday 20th March 2003

State-owned post company New Zealand post increased its six-month profit by 23 percent to $19.6 million, the company said today.

New Zealand Post acting chief executive John Allen said a 0.6 percent increase in domestic mail volumes, driven by high volume business mail, contributed to the result for the period ended December.

The unaudited net result, after tax, was up $3.6 million on the same period the year before.

Domestic mail volumes were up 0.8 percent over the last 18 months, arresting a two-year period of volume decline, Mr Allen said.

"Unaddressed advertising mail also grew as did parcel and courier items. Christmas letter volumes were up on last year, with four days of volumes over five million items, one more than 2001."

The result also reflected the strength of the economy, he said.

Operating revenue was up $4.9 million at $516 million on the back of higher mail volumes, while operating expenses fell $6.6 million to $476.8 million.

The focus on cost reduction remained, particularly in Transend and the Express and Logistics Group.

NZ Post will pay an interim dividend of $11.8 million, or 60 percent of net profit after tax, compared with $9.6 million for the same period last year.

"There were a number of key achievements during the period, particularly in relation to Kiwibank, which already has more than 115,000 customers in its first year of business against a three-year target of 165,000," Mr Allen said.

NZ Post also launched a new financial system, at the cost of $10.1 million, and bought 30 percent of direct marketing text messaging company Synapse.

Mr Allen called the transition of its international postal consultancy Transend Worldwide to focus on smaller contracts in specific regions "difficult". During the period Transend won a $NZ1.5 million contract to provide Hong Kong Post with 650 postal delivery sorting systems.

In December NZ Post chief executive Elmar Toime resigned to take up a position with Royal Mail in the UK, and the company is currently looking for a new chief executive.

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