PostNord Interim Report Q3 2023 – Adjustments to operations continuing
Third quarter 2023
- Net sales totaled SEK 9,149 million (9,456),
a decrease of -6 percent (-2) in fixed currency for like-for-like units
- Parcel volumes decreased by in all -2 percent (-4)
- Mail volumes decreased by -16 percent (-11)
- Operating income (EBIT) totaled SEK -6 million (65)
- Adjusted operating income (adjusted EBIT) was SEK -6 million (108)
Comments from Annemarie Gardshol, CEO
The Group’s sales totaled SEK 9,149 million (9,456), a decrease of -6 percent in fixed currency for like-for-like units. Operating income totaled SEK -6 million (65). Parcel volumes decreased by -2 percent (-4), while mail volumes decreased by -16 percent (-11).
The Group's income decreased mainly through weak growth in operations in Sweden, where production costs, primarily in the parcel and logistics business, have been high relative to the reduced volumes. The sharp decline in mail volumes should be viewed against the background of Sweden’s parliamentary elections in the third quarter of 2022. The parcel market is characterized by pressure on prices and a continued decline in volumes. Income in Sweden was also negatively impacted by continued high inflation, together with actions to improve quality in the mail business. The latter has yielded results and mail quality in the month of September was measured at 95.6 (93.8) percent.
At the same time, in view of the challenging macroeconomic situation, we are pleased to report that in the quarter several of our major segments show improvements in income.
Further actions being taken
The world remains challenging, with high inflation affecting our costs and those of our customers, along with high interest costs that are burdening consumers. We are maintaining a high pace in our improvement programs, as well as our focus on developing flexibility in our business model to enable us to adapt capacity more rapidly in response to changes in volume. We are continuing to apply price increases to compensate for rising costs. As we anticipate a macroeconomic environment that will remain challenging going forward, we are now looking at further measures to adapt our network in Sweden, along with further adjustments to our overall costs.
Industry-leading climate action
It is natural for us to take the lead in the climate transition in the logistics and transport sector. We have high climate ambitions, and have set a goal to be fossil-free by 2030. In September, our Swedish e-commerce logistics business was the first organization in the Nordics to be awarded the Nordic Swan Ecolabel. The award, which recognizes our solid work on sustainability, also enables consumers to feel secure in the knowledge that they are making a sustainable delivery choice.
Continued investments aimed at providing an attractive Nordic parcel offering
On the parcel side, we are continuing to invest in our Nordic offering.
In Finland, we have completed the important process of establishing our own network of parcel lockers and distribution points. The network is now one of the most comprehensive in Finland.
Having a strong, comprehensive offering that caters to consumers’ preferences is absolutely vital. We are continuing to expand and optimize our network of parcel lockers and distribution points. At the end of the quarter, we had 16,000 distribution points – parcel lockers and service points – operating in the Nordics.
Major changes to the universal postal service in Denmark
Before the summer, the Danish government and five opposition parties announced that they were tabling a parliamentary bill to abolish the universal postal service, effective January 1, 2024. The bill includes a special procurement scheme covering mail shipments to small islands, mail for the visually impaired and international mail. The Danish government intends to enter into a transitional agreement with PostNord Denmark until the three procurements are completed. PostNord Denmark has for a long time been a provider of the universal service obligation and has in recent years received compensation from the Danish State for this. The timetable for liberalizing the Danish postal market is tight. There is a dialogue between PostNord and the Danish state about transitional regulations.
Contact person: Björn Bergman, Head of Group Brand & Communication.
This information is of such a nature that PostNord AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted, through the agency of the contact stated above, for publication at 08.30 CET on October 27, 2023.