PostNL profits much lower than expected


Dutch postal operator PostNL saw a collapse in profits in its full 2022 financial year. Profits from continuing operations at PostNL fell sharply by 89% y-o-y to just €26m in the calendar year to 31st December 2022. Revenues were down by 9.3% y-o-y to €3,144m, with most revenue sources seeing drops. However, the decline came after an unprecedented spike in demand as a result of Covid.

Speaking of the year as a whole, PostNL CEO Herna Verhagen said, “High inflation and deteriorating macroeconomic conditions put real pressure on consumer spending throughout the year, at a time that most countries were still recovering from the pandemic and its impact on global supply chains,” continuing, “These developments negatively impacted e-commerce, putting significant pressure on the sector and on PostNL, leading to lower results than we had expected.”

The Mail in the Netherlands segment saw a 12% drop in revenues, partially driven by the global trend of drops in letter mail volumes. Even so, this amounted to a €246m drop in revenues for the postal operator. Verhagen said of this segment, “The main challenges were the very tight labour market and relatively high levels of sick leave.” The leadership set out to tackle the labour shortage, with Verhagen reporting, “We continued to implement our regular cost savings programmes and took several measures to combat the shortage of deliverers.”

Parcel volumes and revenues also saw substantial declines, though revenue per parcel increased by €0.14 y-o-y to €6.29. Macroeconomic factors played a significant role in the drop in volumes. Verhagen admitted, “Lower consumer spending combined with much higher organic cost levels [caused] the e-commerce market and our e-commerce business major challenges.”

PostNL was also rocked by Belgian authorities’ investigations into the legality of immigrant staff used by the postal operator in 2022. The CEO said of this, “The few breaches found during those checks were resolved quickly, with most of our delivery partners fully complying with regulations. We will continue to defend our people vigorously in a court case that will resume in 2023.”

The overall situation is set to recover in the near to medium term according to Verhagen, who said optimistically, “We have no doubt that the opportunities for strong e-commerce development will return as soon as macroeconomic circumstances recover.”

Source: PostNL

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