Swiss Post makes a good start to 2022 in challenging conditions
Swiss Post recorded a better result for the first quarter of 2022 than the prior year period, with a substantial share of this improvement coming from PostFinance. The largest contribution to the Group result was again made by the Logistics Services unit, although parcel volumes declined by around ten percent year-on-year. Overall, Swiss Post remains on track and is pushing ahead with the planned expansion of its logistics infrastructure and digital competencies. Given the many uncertainties and challenges it faces, the company is monitoring the current environment very closely.
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Parcel market grows – but more slowly again
In the first quarter of 2022, Swiss Post generated Group profit of 159 million francs, up 68 million francs on the previous year’s figure. At 145 million francs, operating profit (EBIT) was up 64 million francs year-on-year. Revenue (operating income) reached 1,749 million francs – a rise of 58 million francs over the previous year. “Swiss Post made a good start to the year in the first quarter, and we’re on track both financially and strategically,” says Alex Glanzmann, Head of Finance at Swiss Post. “However, despite this good result, a lot of challenging work still lies ahead of us.”
The main contributor to the encouraging start was PostFinance. Interest income on financial assets continued to decline due to market conditions, but was offset by increased activity in the interbank money market and higher customer asset fees. This meant that interest income was higher overall than in the previous year. PostFinance also achieved better results in commissions and services, thanks in part to new digital investment products such as electronic asset management.
Parcel market grows – but more slowly again
While the decline of –1.8 percent in letters (at 471.8 million) was smaller than in the previous year, parcel volumes in the first quarter fell significantly year-on-year. Swiss Post processed 47.2 million parcels in the first quarter of this year, 9.6 percent less than in the same period in 2021, which saw very high volumes in online retail as a result of the lockdown. The coronavirus measures have now been largely lifted and people are again shopping more in high street stores. Supply bottlenecks in Asia and subdued consumer confidence as a result of the war in Ukraine also contributed to the decline in parcel volumes. This means Swiss Post expects the parcel market to develop more slowly in 2022 than previously assumed. Despite a flattened growth curve, the rise in volumes will continue in the long term. Given such projections, Swiss Post is continuing to expand its parcel processing infrastructure as planned. “The additional capacities are needed to ensure that the processing and delivery of our parcel volumes, which are growing over the long term, are both efficient and environmentally friendly,” says Alex Glanzmann. “However, the fluctuations in volumes and uncertain forecasts with regard to economic trends call for forward-looking management of capacities and costs.”