PostNL: better-than-expected Q2 results and raised FY 2023 outlook
Normalised EBIT of €18 million for Q2 2023 (Q2 2022: €10 million)
The Hague, 7 August 2023
- Better-than-expected volume development at Parcels: volumes up 3.3%, with growth from domestic and, predominantly, international customers
- Reported volumes -9.0% at Mail in the Netherlands, mainly substitution
- Measures taken to mitigate inflationary pressures supported good operational leverage and efficiency improvements
- 10% further improvement in average carbon efficiency
- Reduction of 200-300 FTEs in overhead, mainly at Parcels, ahead of schedule:
- restructuring and related costs in 2023 €10 million at most (previously: around €20 million), of which €5 million in Q2
- small part of cost savings expected to be achieved as early as in 2023 (previously: ~€25 million as of 2024)
- Interim dividend set at €0.06 per share
Raised outlook for FY 2023
- Normalised EBIT between €100 million and €130 million (previously: between €70 million and €100 million)
- Free cash flow unchanged at between €10 million and €40 million
Herna Verhagen, CEO of PostNL, said: “We are pleased to announce a second consecutive quarter with results above expectations. Our adaptive measures to mitigate inflationary pressures are successfully paying off and volumes at Parcels returned to growth earlier than expected. In particular, volumes from international customers were above last year's level. Our cross-border activities maintained the positive trend visible since late 2022. Moreover, measures we have taken such as optimisation of routes, staff and fleet, resulted in improved operational leverage. At Mail in the Netherlands, developments are becoming more challenging. Overall, as expected, performance in the second quarter was lower than last year. Mail delivery quality, is below the required level, mainly due to the tight labour market and high sick leave rates, and this has our full attention.
“During the quarter, we made steady progress on our plans to reduce 200 -300 FTEs in overhead, mainly at Parcels. We have started to implement these plans, with expected annual savings of around €25 million to be achieved partially in 2023. And the restructuring and related costs are now expected to be significantly less than assumed earlier.
“We remain confident in our strategy and are continuing our transformation into an e-commerce logistics player. In the meantime, we are successfully navigating the current environment, that is still uncertain and volatile. Taking into account the lower restructuring costs and better-than-expected results in the first half of the year, we are comfortable to raise our outlook for FY 2023 normalised EBIT to between €100 million and €130 million. With the contribution of Mail in the Netherlands expected to be below our original expectation, the improved outlook for FY 2023 is driven by a stronger performance at Parcels.”
We are PostNL, here for everyone, bringing it all together for 225 years. With an extensive network of nearly 5,800 PostNL points, 11,000 letterboxes, and over 900 automated, also open to various carriers, along with millions of users of the PostNL app, we're always close by. We aim to be everyone's favourite deliverer by making it as easy as possible to send and receive parcels and mail. With nearly 34,000 colleagues working with us, we are part of society. We offer a range of services, including mail and parcel delivery, logistic e-commerce solutions, and cross-border solutions. On an average weekday in the Benelux, we deliver 1.1 million parcels and 6.9 million letters. We are commitment to customer satisfaction, providing opportunities for our employees, and generating value for our stakeholders through growth, digitalisation, and sustainability.
We optimise and support our physical networks through the use of smart digital solutions and introduce new propositions that add value for our customers. And aim for sustainable employment relationships by being a good employer to all people working with and for us. We focus on sustainability, making many journeys on foot and by bicycle, increasingly using cleaner fuels and electric vehicles, and offering innovative city logistics. PostNL N.V. is a publicly traded company with a turnover of €3.2 billion in 2023, 62% of which e-commerce related.