NZ Post delivers $137m profit

New Zealand Post has paid the Government $50 million in dividend this year after it announced a record $137.2 million June year net profit today.

The profit included a one-off $78.6m gain on the sale of Express Couriers to NZ Post's joint venture with DHL, a unit of Europe's biggest postal service, Deutsche Post.

Part of the Government's dividend included $23m from the one-off gain.

Excluding the one-off, NZ Post's net profit was $58.6m, up 60.5 per cent on last year's $36.5m. The State-Owned Enterprise made a $40.4m half year net profit.
Last year NZ Post paid $21.9m in dividends.

Chief executive John Allen said the result was driven by a strong performance by the Postal Services Group and the maiden profit of its Kiwibank susidiary.

Chairman Jim Bolger said the corporation was one of the strongest performers of any postal service around the world and its performance was all the more remarkable as its core service, traditional letters, were a declining business.

Mr Bolger noted that since NZ Post had been turned into a State-Owned Enterprise in 1987, it had paid the Government over $1 billion in dividends.

The establishment of the Express Couriers joint venture had allowed NZ Post to create a more integrated service by combining DHL's international network and service with New Zealand's local network.

The Postal Services Group, had a good year despite the continuing trend by people to use electronic services such as email and texting.

Overall mail volumes rose by 1.4 per cent thanks to greater use of direct mail and bulk business mailing and domestic parcel volumes, boosted by the activities of on-line auction house Trade Me, rose 7.4 per cent.

Standard rate mail continued to decline.

NZ Post was embarking on getting New Zealanders to use postcodes to improve efficiency.

Operating revnue rose 15 per cent to $1.21 billion and expenses rose 5.5 per cent to $1.04 billion.

Excluding the one-one gain, earnings before interest and tax rose to $89.6m from $73.4m.

Mr Allen said that NZ Post's financial position was strong, with equity rising to $483m from $350m a year earlier, and there would be no need to call on the Government to increase Kiwibank's equity as the bank grew.

He said Kiwibank now accounted for the lion's share of NZ Post's balance sheet and it would play an increasingly important role within the corporation.

"A great deal of our future is tied up in the continued growth of Kiwibank." he said.

While NZ Post was unlikely to repeat the net profit of 2005 due to the one-off gain, Mr Allen said the underlying profitability of the corporation would continue to grow.

- NZPA