AusPost to transform delivery network on declining profits 

Dean Blake

25th Feb 2020

Australia Post saw its busiest Christmas ever, delivering 50 million parcels across the country in December, though declining letter volumes knocked profit for the half down by almost half. 

The logistics provider grew revenue in its parcels and services division to $2.69 billion for the six months to 31 December – 13 per cent up on the same period of FY19. 

The result drove group revenue to $3.8 billion for the half, up four per cent on the prior year, though the continuing decline in Australian’s use of letters continued – with category revenue falling nine per cent to $1.1 billion.

This result ultimately led to a 46 per cent fall in group profit for the half to $83 million. 

Group chief executive Christine Holgate said the increasing cost of the people delivering, collecting and processing letters, in tandem with the falling volume of letters sent and by extension revenue of the letters vertical, largely led to the result. 

“Australia Post and the services we provide are highly regarded in the community, particularly in rural and regional Australia, where often we are the last remaining service provider with a physical presence,” Holgate said.

“In order to ensure we are able to continue to provide these community services and remain sustainable, the time has come we must transform our delivery network.”

While Holgate didn’t specify what this transformation would entail, Australia Post has already begun investing in automation across its processing facilities, while also opening the largest parcel processing facility in the southern hemisphere. 

The business also partnered with fulfilment firm Doddle to expand its collect and return network across retail and property partners, such as IGA and Priceline.