Swiss Post profits see significant drop

Swiss Post has seen a significant drop in profits in 2016 by comparison to 2015. In the first three quarters of 2016 it generated a Group profit of SFr466m, down from SFr503 million in 2015. Operating profit (EBIT) fell to SFr593 million from SFr640 million in 2015.

Swiss Post said that the drop in profits was “mainly due to the lower result from the communication and logistics markets; the decline in the volume of addressed letters was more pronounced and pressure on parcel margins remains high”.

Where letter mail is dropping globally for postal operators and most are working on surviving this, Swiss Post also saw a significant drop in its communications market. Swiss Post saw an operating profit of SFr94 million in the first three quarters of 2016, down substantially from last year’s SFr166 million. Swiss Post said that the decline in profit generated from Post Offices & Sales was “principally due to the Group unit’s new internal cost allocation”.

The volume of addressed letters, as with many of Swiss Post’s opposite numbers around the world, fell again by 4%.

Swiss Post concluded its report with a very cautious outlook: “Given the current tense market environment, it will become more and more difficult for Swiss Post to achieve the financial goals set by its owner. As things stand today, Swiss Post nonetheless expects to meet these goals in 2016. Group profit is likely to be below the previous year’s level.”

All postal operators are facing a change in fortunes to some extent and must change themselves in order to survive. None have gone under though some are making obscene losses such as the USPS.

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