- Net sales SEK 9,638m (10,033).
- Operating income SEK 300m (312).
- Net income for the period SEK 219m (203).
- Earnings per share SEK 0.11 (0.10)
- Cash flow from operating activities SEK 211m (1,140).
Message from Håkan Ericsson, President and CEO
E-commerce continues to grow with impressive momentum. The logistics market is expanding, but competition is tough. The mail market is characterized by declining volumes. In this market situation, we are continuing to make headway on our chosen path, to maintain a high pace in adapting our business to meet new needs and conditions.
Group operating income for the first quarter totaled SEK 300m (312). Net sales, excluding acquisitions and exchange rate effects, decreased by 4% compared to the corresponding quarter last year, mainly as a result of a fall in mail volumes. The decrease was partly caused by the calendar effect of the early Easter holiday. Our robust programme of adjustment is progressing according to plan, and cost reductions have enabled us to offset the loss of revenue.
The strong growth in e-commerce throughout the Nordic region continues. Our B2C volumes were 12.4% higher than in the corresponding quarter in 2015. PostNord is steadily consolidating its position as the first choice for e-retailers, by offering specialist know-how and offering a competitive portfolio of services that cater to all customer needs. On April 1, we launched MyPack in Europe, providing a service that enables our e-commerce customers to reach private individuals in Europe. This is made possible via our collaboration with DPD, which operates perhaps the best delivery network in Europe.
As part of our strategy to develop a harmonized end-to-end Nordic offering, we acquired G.P. Spedition in Denmark. The acquisition boosts our total offering in heavy logistics, above all in Danish and intra-Nordic logistics. PostNord is already a major, broadly-based logistics operator in Sweden and Norway. With the expansion in Denmark and last year’s acquisition of UPK in Finland, we have rounded out our cross-border logistics offering to customers in all Nordic countries.
The Group’s total mail volumes declined by 8% in the quarter, of which 18% in Denmark and 6% in Sweden. However, volumes were also impacted to some extent by the above-mentioned Easter effect. This development put pressure on constant adjustment of our operations. We are now progressively implementing our integrated production model, enabling us to increase capacity utilization and improve efficiency and service to our customers. It is also a matter of urgency that postal regulations should be realigned with the current business and communication landscape, in which digital modes of communication are continuing to gain ground. Against that background, we welcome that the Swedish government’s special inquiry recommends that the requirement for overnight delivery be changed to two-day delivery. As regards the price cap, the inquiry opens up the possibility of taking our volume losses into account, but at the same time proposes that Sweden’s Consumer Price Index (KPI) should be retained as a parameter. It is unfortunate since KPI doesn’t reflect the price development for the major cost drivers in our business. The final report from the inquiry is expected after the summer. In Denmark, work continues on the review of Danish postal legislation.
One of our strategic priorities is to integrate sustainability into everything we do. To customers this means, for example, that we can help them cut their carbon dioxide emissions by offering environmentally correct communication and logistics solutions. We also aim to be an attractive employer who conducts its operations by clear business ethics principles and who makes correspondingly high demands on suppliers. Quality is an important priority area and, following disruptions during 2015 in Sweden, we have established better stability. By maintaining an even enhanced focus on quality throughout the organization and keeping up a high pace of development in our end-to-end Nordic offering, we will continue to live up to our customer promise. We deliver.
PostNord AB (publ) is required to disclose the above information under the provisions of the Securities Market Act and/or the Financial Instruments Trading Act. The information was submitted for publication at 08.30 AM CET on April 29, 2016.