A sharp decline in lettermail volumes and a drop in parcel volumes led to a 56% y-o-y drop in operating profit for PostNord in the first financial quarter of the year. Though revenues grew 1% compared to Q1, 2022 to SEK 9.9bn (£769m) the postal operator saw a fall in profits to SEK 43m (£3.34m).
Lettermail volumes dropped by 11% y-o-y and parcel volumes also saw a 2% drop compared to Q1, 2022. A total of 58m parcels were handled, only slightly down compared to 59m for the comparable quarter. Forward exchange contracts played a role in the bottom line too.
Annmarie Gardshol, President and CEO of the PostNord Group said of the fall in profits, “The confidence of consumers regarding their own finances remains at historically low levels and transportation costs are persistently high.” However, looking forward she added, “It is clear that the sharp decline in volume in the wake of the pandemic has started to ease.”
As of April 1, 2023, PostNord’s Board has introduced a new organisational structure where all non-Nordics parcel logistics will be handled under the PostNord International brand. This will help the postal operator manage imports from China, USA, the UK and Europe and so on with a dedicated organisational and management channel.
In recent months, a Swedish government commission has stated that PostNord’s Universal Service Obligation (USO) should qualify for state aid. Gardshol said of this, “This is important in terms of ensuring an efficient and accessible postal service for everyone living and working in the country.” Currently it operates an alternate day letter delivery service to addresses in the country to manage the costs of the USO, and future government support should ensure this is maintained into the future.
Delivery costs and sustainability at the postal operator have also been minimised thanks to the company’s well established parcel locker network across the Nordics. This amounts to some 13,000 units with much of the region offering parcel lockers within easy reach of consumers.
Gardshol concluded, “I would like to express my sincere thanks to all our employees for your hard work, dedication and loyalty in a period of challenging circumstances and essential adjustments.”
Source: Ti Insights
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