In a seasonally quieter quarter amid persistent challenging conditions, the overall performance of the Bpost group exceeded expectations. Despite ongoing challenges, Belgium demonstrated resilience, propelled by robust parcel volumes and improved profits in Eurasia, offsetting revenue pressures in North America.
The group’s operating income stood at €978.5 m, a decrease of 4.2% compared to the previous year. Adjusted EBIT reached €28.1m (with a margin of 2.9%), or €23.1m excluding a €5.0m downward revision due to repricing services for the Belgian State. The reported EBIT was €-50.1 m, impacted by a provision of €75.0 m related to overcompensation. Belgium witnessed a total operating income of €538.4m, marking a 6.2% increase. Despite an underlying decline in mail volume by 8.2%, positive price/mix effects almost balanced the decrease. Parcel volumes surged by 5.5%, accompanied by a 6.6% price/mix impact. However, higher operating expenses (+20.8%) were due to the €75.0m provision for overcompensation. This provision led to a reported EBIT of €-49.2m, while the adjusted EBIT, among other adjustments for this provision, stood at 25.9 m (4.8% margin).
E-Logistics Eurasia recorded a total operating income of 151.6 m (-2.4%), driven by decreased cross-border sales in the UK and softer growth from recent Asian customer wins. However, Radial EU and Active Ants continued expanding (+11%). Lower operating expenses (-6.8%) were attributed to reduced transport costs aligned with volume development and steady payroll expenses. The reported EBIT was €7.1 m (+4.7%), with an adjusted EBIT of €7.9 m (5.2% margin). E-Logistics North America experienced a total operating income of €310.3 m, reflecting a decrease of 17.6% (or -10.8% at constant exchange rates) due to lower volumes at Radial and Landmark US (Amazon insourcing). Despite lower variable costs and improved labor management, reported EBIT stood at €2.3 m (0.8% margin), with an adjusted EBIT of €4.5 m (1.5% margin).
Philippe Dartienne, CEO a.i. of bpostgroup, acknowledged the solid performance amidst challenging market conditions in the third quarter, expressing gratitude to employees for their efforts. Dartienne highlighted progress in compliance reviews, reinstating the group’s EBIT guidance for 2023 and welcoming the new Group CEO, Chris Peeters. Looking ahead, the focus is on the fourth quarter and year-end peak season, despite uncertainties, particularly in North America.Regarding the 2023 group EBIT outlook, despite challenges in North America and compliance review impacts, bpostgroup anticipates the group adjusted EBIT to surpass €240 m. The total operating income for 2023 is expected to decrease by a low-single-digit percentage.The revised outlook for Belgium forecasts a 4-5% growth in total operating income, driven by specific projections for mail and parcel services, with an adjusted EBIT margin of 7-9%. E-Logistics Eurasia anticipates low double-digit percentage growth in total operating income, while E-Logistics North America expects a low double-digit percentage decline. Adjusted EBIT margins for both regions are forecasted accordingly.The group EBIT will include increased payroll costs at the corporate level, operating expenses supporting ongoing transformation, and impacts from compliance reviews. The gross capex is estimated at around €170 m, reflecting prudent spending in challenging market conditions.