Weaker result for Postal Services, Parcel and Logistics business turns to profit



Posti Group Corporation's Financial Statements and Board of Directors' Report for 2015

October-December 2015


Year 2015



 Key figures of Posti Group 10-12 10-12 1-12 1-12
  2015 2014 2015 2014
Net sales, EUR million 434.7 491.7 1,650.3 1,858.7
Operating result (non-IFRS), EUR million* 25.4 23.5 48.7 50.8
  Operating result (non-IFRS), %* 5.8 4.8 2.9 2.7
Operating result (EBIT), EUR million 9.7 10.9 55.9 5.8
  Operating result (EBIT), % 2.2 2.2 3.4 0.3
Result before taxes, EUR million 6.1 7.6 43.3 -4.6
Result for the period, EUR million 4.2 4.5 36.0 -4.4
  Return on equity (12 months), %     6.1 -0.7
  Return on invested capital (12 months), %     6.3 1.0
  Equity ratio, %     47.8 45.9
  Gearing, %     -10.5 17.2
Gross capital expenditure, EUR million 16.8 14.6 60.6 57.5
Average number of employees     22,219 24,617
Dividend     18.0** -
*) Non-IFRS = excluding non-recurring items        
**) Board of Directors' proposal to the Annual General Meeting        



Heikki Malinen, President and CEO:

"The year 2015 was difficult for Posti Group due to the transformation of the communication sector and the weak market situation in our business environment. Our net sales decreased across all business groups. Declining volumes in Posti's core business of delivering letters and publications reduced net sales by nearly EUR 75 million. Domestic freight transport volumes decreased as the total market continued to decline. Itella Russia's net sales were eroded by the weak ruble and the problems of the Russian economy.

In spite of the decrease in net sales, the Group's operating result remained at the previous year's level. This has, however, required many substitution measures and painful decisions. We have had to compensate for the losses through cost savings, efficiency improvements, price increases, and personnel reductions.

The most significant source of satisfaction was the strong improvement in the result of the Parcel and Logistics Services business group. Its operating result turned to profit on the strength of determined efficiency improvement measures and restructuring. In the previous year, the logistics business recorded a significant loss. Going forward, we expect various logistics services to be the engine of Posti's growth. Posti delivered over 33 million parcels last year, which represents an increase of more than 2%. In the latter part of the year, we unfortunately lost parcel volume to our competitors due to strikes.

Posti Group's operating result for 2015 showed a significant improvement from the previous year. The improved result is attributable to the positive result of Parcel and Logistics Services as well as a sale and leaseback transaction worth EUR 120 million, which involved Posti selling logistics properties located in Finland. The operating result in the comparison period was weighed down by non-recurring costs of EUR 45 million.

In Russia, the market situation became bleaker during the year. The substantially weaker national economy, declining consumer purchasing power and the weak ruble are currently complicating the business operations of foreign companies operating in Russia, and Itella Russia is no exception. Unfortunately, the prospects for 2016 involve significant continued uncertainty.

Posti faces unavoidable structural reforms as the volumes of traditional mail decline. Digitalization and intensifying competition give Posti no alternative but to quickly adapt to the changes. At the same time, we will seek new growth, particularly in logistics, warehousing, e-commerce, and new consumer services. We also see significant growth potential in OpusCapita's financial management software, financial processes and automation services.

Posti must carefully manage its profitability. While Posti's non-IFRS operating result improved from 2.7% to 2.9%, profitability is short of the target level of 5%. It is a concern that the operating result of the company's cornerstone, Postal Services, declined by as much as 15% last year, which represents a decrease of approximately EUR 10 million. The decline in volume has forced Posti to initiate cooperation negotiations.

Securing profitability is crucial for Posti also because we operate without public subsidies. In order for us to develop our operations and invest in growth projects, our operations must have a financially solid foundation. Increasing digitalization is also forcing us to achieve renewal in our operations. To accomplish this, we must allocate more resources to the digitalization of our services and production.Our investments last year amounted to EUR 61 million, which is 75% of depreciation. We must increase our level of investment in the medium term. We cannot fall behind in digitalization."



Financial Statements Release and the Board of Directors' Report (pdf)
Corporate Governance Statement 2015 (pdf)


Heikki Malinen, President and CEO, and Sari Helander, CFO
Tel. +358 20 452 3366 (MediaDesk)

Key media


Interim Report Q1/2016: April 29, 2016
Interim Report Q2/2016: July 18, 2016
Interim Report Q3/2016: October 31, 2016




Posti Group is your first choice in postal, logistics and e-commerce services. We manage the flow of commerce and everyday life in nine countries. Our net sales in 2015 amounted to EUR 1,650 million. We employ approximately 22,000 professionals who serve our customers in Finland under the name Posti and in other countries under the name Itella. All of our services in Finland are carbon neutral. www.posti.com.

Posti_Group_Financial_Statements_Release Posti_Group_Corporate_Governance_Statement_2015.pdf