News vom 12.12.2007
Austrian Post Repositions Parcel & Logistics Division in Austria
- Package of measures approved a realignment of the Parcel & Logistics Division
- Positive EBIT 2008 in the Parcel & Logistics Division and also in Austrian Post’s parcels business in Austria
- Austrian Post maintains medium-term EBIT target of 7% - 8%; EBIT goal of 5% for the Parcel & Logistics Division
- Reduction of parcel delivery bases from 21 to 14 locations, and greater integration in the letter mail logistics than in the past; transfer of parcel sorting centre from Graz to Kalsdorf; reduction of parcel logistics work force by 360 employees by the end of 2008
- Austrian Post also launches 24 hour next day parcel service for the B2C segment; Saturday and multiple delivery attempts
In a Supervisory Board meeting held on December 12, 2007, the Management Board and Supervisory Board of Austrian Post approved a comprehensive plan to reposition the Parcel & Logistics Division in Austria.
Essentially, the concept encompasses three core measures which will be implemented during the year 2008 to enable an improved market position of the Parcel & Logistics Division.
1. Redimensioning (downsizing) of parcel logistics operations, and its partial integration in the letter mail logistics operations, in order to create an even more efficient nationwide delivery network
2. New premium product: the 24 hour business parcel (B2B and B2C)
3. Growth in the B2B business customer parcels segment – market share of 20% in 2011
The restructuring measures will lead to the closing of 7 parcel delivery bases, and the transfer of the Parcel Sorting Centre Graz to the existing location in Kalsdorf. The planned reduction in the parcel logistics work force by about 360 employees resulting from lower parcel volumes will be cushioned as much as possible by shifting employees to the Mail Division or by means of a social (redundancy) plan.
"In recent years, we have transformed Austrian Post into a successful and profitable company. The EBIT has risen continually from EUR 4m in 2002 to a planned level of EUR 160m in 2007. The current package of measures will enable us to continue our path to success. The restructuring measures will ensure that the Group profit for the period in 2008 will only be slightly under the 2007 level, and then rise continually. We are well on track to achieve an expected mid-term EBIT margin of between 7% and 8%”, says Anton Wais, Chairman of the Management Board of Austrian Post.
The restructuring plan encompasses the following measures:
1. Redimensioning of parcel logistics operations: quicker and more efficient service in conjunction with letter mail logistics
This new approach will enable standard package logistics to be carried out in a more efficient manner, and exploit synergies with letter mail delivery processes. A total of 7 parcel delivery bases (Wörgl, Vitis, Steyr-Dietach, Großwilfersdorf, Fohnsdorf, Liezen and St. Georgen locations), will be closed. A large proportion of the parcels volume will be handled by Austrian Post’s nationwide network of 11,000 delivery staff. Parcel delivery in urban areas will continue to be carried out with a separate parcel delivery service.
Accordingly, Austrian Post will require about 360 fewer employees for parcel logistics. All related measures will be cushioned by an existing employee severance scheme. In addition, some employees from the Parcel & Logistics Division will be integrated into the letter mail logistics segment. Transport logistics will be further optimised, and the areas covered by existing freight carriers partnering with Austrian Post will be expanded.
2. Improved and value added services: launch of new premium product, the “24 hour business parcel service“ to complement the 48 hour parcel
The Parcel & Logistics Division will offer improved services in the course of the year 2008. A new premium product, the “24 hour business parcel service” will provide considerable competitive advantages to B2B and B2C customers. The final deadline for accepting parcels for next day delivery will be extended from 7:00 p.m. at present until 1:00 a.m. This represents an extremely significant improvement, taking into account the parcels arriving from international central storage facilities, which are increasingly located outside of Austria.
Moreover, multiple delivery attempts and Saturday delivery are among the changes which will primarily benefit private customers. In the case of multiple delivery attempts, a time will be scheduled with the recipient via a call centre and electronic notification of the parcel delivery staff.
3. Sales drive in the B2B segment – market share of 20% targeted for 2011
Austrian Post will initiate a sales drive to win over new customers in the business parcels segment. In particular, logistics complexity and expense will be improved and flexible rerouting made possible due to evening and late parcel pick-up, as well as a new IT full data registration system for all parcels. Specialised sectoral solutions such as temperature-controlled transport will be expanded. Austrian Post expects to increase its market share in the B2B segment from a current level of 5% to about 20% in 2011.
“With all these measures and a more offensive business strategy, the role of Austrian Post will be transformed, making it not only the traditional caretaker of the Austrian postal market but also a hunter more aggressively striving to increase its market share“, Austrian Post Management Board Chairman Wais adds.
The newly-announced restructuring measures will ensure a sustainable increase in the company’s profitability. The Parcel & Logistics Division will not only be profitable internationally (75% of revenue in the Parcel & Logistics Division now being generated outside of Austria following acquisitions made in recent years) but also remain profitable in Austria. On a medium-term basis, the Parcel & Logistics Division aims to achieve an EBIT margin of 5%.
Despite the loss of parcels volume on the domestic parcels market, Austrian Post expects earnings before interest and tax (EBIT) to be only slightly below the 2007 level, and then rise again continually in succeeding financial years.
Head of Public Relations
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Head of Investor Relations & Public Relations
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Vienna, December 12, 2007