Swiss Post achieves 35 million franc lower operating result
Published: Thursday, Mar 14th 2024, 10:41
Updated At: Thursday, Mar 14th 2024, 13:30
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Swiss Post generated a Group profit of 254 million francs in 2023, compared with 295 million francs in 2022. The result was heavily influenced by the decline in letter and parcel volumes. The Postal Network segment also recorded further losses due to the decline in payment transactions at post office counters.
The consequences of inflation, depressed consumer sentiment and the decline in the core business also played a role, as was reported to the media in Bern on Thursday. At 323 million francs, the operating result (EBIT) was 35 million francs below that of the previous year.
Operating income amounted to CHF 7279 million (previous year: CHF 6859 million). Overall, 2023 was in line with expectations.
Fewer parcels and letters sent
In the Logistics Services division, earnings before interest and taxes fell by 23 million francs to 335 million francs. Despite declining parcel volumes (down 4.6 percent compared to 2022), growth is expected here in the long term. Swiss Post customers are now sending around 70 percent more parcels than ten years ago. This is why Swiss Post has also opened new parcel sorting locations in 2023.
Letter volumes fell by 5.6 percent compared to the previous year to 1647 million. The advertising market, which is heavily dependent on the economy, was unable to escape the negative consumer sentiment. Addressed advertising mail fell by 5.3 percent and unaddressed advertising by 6.4 percent.
18 percent fewer payments at the counter
The Postal Network segment posted an operating loss of 93 million francs - compared to minus 71 million francs in 2022. In particular, there was a sharp decline of over 18 percent in over-the-counter payment transactions in 2023. Overall, payment transactions have fallen by almost 50 percent in the last five years.
At 21 million francs, the 2023 result for Mobility Services (PostBus and Post Company Cars) was 6 million francs lower than in the previous year. The increase in passenger numbers at PostBus was unable to offset the simultaneous rise in personnel and fuel costs. Demand at PostBus has increased and is above the pre-pandemic level (up 4.2 percent on 2019).
The operating result of the Communication Services segment was the same as in the previous year, with a loss of CHF 72 million, according to the statement. This segment is still being developed. However, operating income rose by 84 million francs in 2022 to 157 million francs. It was increased primarily through strategic acquisitions in the areas of e-government, secure customer communication and cybersecurity, according to the statement.
Interest rate turnaround has a positive effect
Postfinance, the second-largest segment, felt the positive impact of the interest rate turnaround last year and achieved a higher operating result. The financial subsidiary of Swiss Post generated a good 15 percent higher operating profit of 264 million francs (previous year: 229 million francs). Operating income increased by a good quarter to 1.96 billion francs in 2023.
Compared to the end of 2022, however, customer assets fell by a good 0.5 billion to 104.1 billion francs. The Swiss Post subsidiary had a total of 2.47 million customers at the end of September.
Swiss Post must adapt
Chairman of the Board of Directors Christian Levrat and CEO Roberto Cirillo also emphasized that Swiss Post must adapt to changing customer needs.
In order to fulfill its mission, Swiss Post needs "more freedom", said Levrat. In view of the current challenges, particularly in the area of digitalization, measures have been taken to develop initial answers. "But that's not enough," said the former SP member of the Council of States, who mentioned the topics of electronic identity, the electronic patient dossier and e-voting.
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