New Zealand Post Increases Year End Profit Result

New Zealand Post Increases Year End Profit Result

New Zealand Post announced today it had achieved a profit result of $21.9 million after tax for the 12 months to 30 June 2002, an increase of 4.1% on last year.

Chairman Jim Bolger said the result was pleasing, particularly given the major development costs associated with Kiwibank over the year.

“In one of the world’s most competitive letter markets, New Zealand Post continues to provide a world class service, return a dividend and build value for the Shareholder.”

Chief Executive Elmar Toime said that Zealand Post’s domestic mail volumes had increased against a worldwide trend of decline, and service performance for mail delivered on time improved from 95.7% in 2001 to 96.1%.

“Our core business has performed well with domestic letter volumes increasing by 0.8% driven by good economic conditions and the 2001 local government and 2002 general election campaigns. On 3 May we processed 6.9 million items, the highest volume ever recorded on a single day. This beat the previous record of 6.7 million items processed on ‘Free Post Day’ in July 1996.

“While we don’t expect domestic letter volumes to grow at a faster rate in the years ahead, we do expect the business segment to continue to be profitable.”

Mr Toime said New Zealand Post had no plans to raise the price of Standard Post.

“At 40c, the standard letter rate remains one of the cheapest in the OECD and at the same price as it was fifteen years ago. If the price had increased with inflation since 1987, it would now cost 65 cents to send a letter by Standard Post.”

Another highlight for the year was the launch of Kiwibank, which now has the largest branch network of any bank in the country with 259 outlets.

“The launch of Kiwibank during the year was a major logistical undertaking and it is to the credit of New Zealand Post people that it was achieved on time and within budget. The customer uptake has exceeded forecast expectations and we have received very positive feedback about the wide range of products and services available,” said Mr Toime.

Operating revenue was up 1.2% at $966.4 million on the previous year ($954.7 million).

Expenses increased by 2.0% to $931.4 on the previous year ($13.2 million), largely as a result of the planned expenditure on Kiwibank. Excluding Kiwibank, overall expenditure reduced by $1.2 million (0.1%), demonstrating continued attention to cost containment and productivity improvements.

An interim dividend payment of $9.6 million was made to the Shareholder, with a final dividend of $3.5 million to be paid on 30 September.

“We are confident New Zealand Post will continue to grow by strengthening its core business capabilities, building Kiwibank and exporting our expertise and equipment through Transend Worldwide.”
Financial Performance Twelve months ended 30 June 2002 Twelve months ended 30 June 2001
Operating revenue $966.4m $954.7m
Operating expenditure $931.4m $913.2m
Net earnings $21.9m $21.0m
Total dividend $13.1m $7.4m
Total dividend per share 6.8c 6.2c
Issued and paid-up capital $192.2m $120.0m
Total equity $303.9m $208.5m

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