NZ Post profits flat as postal declines

NZ Post says letter volumes were down 6 per cent. Photo/Anthony Phelps

New Zealand Post has reported a half-year net profit of $52.8 million, as the contribution from subsidiary Kiwibank grew but postal services declined.

The result for the six months to December was barely changed from the corresponding period a year earlier.

It was achieved on revenue of $656.2m, slightly down from $658.3m a year earlier, but NZ Post said the revenue figures were not directly comparable as a result of changes to the group's Australian courier operations.

The state-owned enterprise is cutting its interim dividend to the Government to $6.9m from $16.9m a year earlier.

Group chief executive John Allen said the level of dividend had been cut to enable reinvestment of funds into the business.

Letter volumes were down about 6 per cent in the first half, with the decline across domestic and international letters and unaddressed mail, said Allen.

It was caused by electronic substitution, the economic climate and competition.

The data management operation was experiencing slightly reduced mail volumes, but the economic climate was creating increased interest in business processing outsourcing and customer relationship management.

Allan said the second half of the year was expected to be challenging, with the low growth economic environment continuing for the foreseeable future.

- NZPA