NZ Post has reported a net loss after tax of $121 million for the financial year.
Last year the company made profit of $13m but this was impacted by 65.8 million fewer letters sent compared to the previous year.
Net profit was also impacted by a $38m one-off cost to bring NZ Post in line with the Holidays Act 2003, a $51m write down on mail assets, and a $59m write down of a deferred tax asset.
Revenue was up to $35 million with a strong performance in the parcel business with 78 million deliveries in the year.
“This operational performance shows that the strategy to focus on parcels is the right one, as our parcels business continues to grow,” NZ Post board chair Rodger Finlay says.
“We will continue to look to invest for the future, to meet the opportunities from eCommerce.
“We also continue to recalibrate for low numbers of letters being sent and the impact this has on our bottom line.
“1.8 million New Zealanders shopped online in 2018, spending a total of $4.2 billion. A significant proportion of this spending is on items that require delivery as parcels. NZ Post completes well over half of these deliveries.
“Our challenge is to juggle the cost of delivering mail and the reduction in the number of letters being sent, with the high value that New Zealanders place on the mail service.
“Providing a physical mail service for New Zealanders that meets the needs of both rural and urban New Zealand is part of NZ Post’s DNA – but it must be financially sustainable on its own,” Finlay says.
NZ Post chief executive David Walsh says eCommerce presents some strong opportunities “especially in the fast-growing business-to-consumer market where NZ Post has the largest share”.
“It was a record Christmas too, with over 14.5 million parcels delivered during November and December. That’s an average of almost three parcels a second. We will be investing significantly in our parcel network over the next three years to continue to meet this growth.”
“Ten years ago, one billion letters each year were sent through our network – in the past 12 months we delivered just 380 million letters, and an unquantifiable reduction is set to continue,” Walsh says.
“This won’t be a surprise for New Zealanders. Around the world, people have been sending fewer letters for many years now.
“Even so, mail continues to be valued by New Zealanders – we currently use letters for a range of important functions, such as local government elections and medical appointments.”
