AusPost makes the most of e-commerce boom while letter volumes decline

Robert Stockdill

23rd Feb 2022

Surging parcels and service revenue drove a healthy increase in profit for Australia Post in the December half. 

With an estimated 15 million Australians under lockdown due to the Covid-19 pandemic at times during the period, there was significant migration to shopping online. Australia Post boosted revenue by 10.4 per cent to $4.8 billion, on the back of a 13.6-per-cent increase in parcel and services revenue, which reached $3.87 billion. 

Letter revenue, once the former government department’s business backbone, continued its decline, down by 1.2 per cent to $935 million, despite the national Census mailout. 

Group CEO and MD Paul Graham described the parcel volume as the strongest in the company’s history. 

He said the result was a significant achievement given the ongoing disruptions to the business during the Covid-19 pandemic and the necessary network changes required to continue to provide essential goods and services to customers.  

“Just like many businesses around the country, we have dealt with unprecedented challenges over the past year, but the ability of our people to adapt during ongoing challenges presented by the Covid-19 pandemic has been nothing short of remarkable,” he said.  

Australia Post’s network of 4300 post offices around the country hosted 112 million visits during the half, 20 million of those in December alone. 

An improved profit of $199.8 million was aided by asset sales, revaluations and favourable bond rate movements. 

During the half, the company invested $217.8 million in capital – $28.4 million more than last year – part of $400 million budgeted for this year covering new parcel facilities, updated vehicle fleets, and technology. 

While the first-half results were positive, Australia Post anticipates a loss during the second half due to declining letter volumes, and a more subdued e-commerce market as consumers return to physical stores. 

“Australia Post will release full-year results in September, and at this stage expects to post a modest profit while being cognisant of the ongoing uncertainty of Covid-19 and pressures facing customers,” the company said in a statement.