This growth was based on the company’s logistics and international e-commerce business. On the other hand, the quarter was characterised by a further decrease in the traditional letter service segment.
In the first quarter of 2016, the total revenue of the group amounted to 20.6 million euros, a 23% increase compared to the same period of the previous year. The increase in revenue was most influenced by growth in the volume of Omniva’s e-commerce business and logistics services. Revenues from postal services decreased by 7%.
The company's growth is driven by its parcel business
The volume of Omniva’s parcel business services grew by 26% compared to the first quarter of the previous year. Growth was especially remarkable in the other Baltic states, particularly in Latvia, where the volume of parcel services grew by 86% in Q1 in a year-on-year comparison.
Omniva’s network of parcel machines that is convenient for and easily accessible by our clients supports growth in the volume of Omniva’s parcel business services. Omniva's 205 parcel machines make up the largest network of parcel machines in the Baltic states, and this number will further increase by approximately a third in 2016. At the same time, Omniva's parcel machine service will become more and more available in smaller towns and settlements too.
In March 2015, elections of the Estonian Parliament, or Riigikogu, were held. Therefore, profits from advertising services decreased by 26% in the first quarter of 2016. The yearly decrease in the volume of letters sent in Estonia was 7% and the respective decrease in profits was 1%. The decrease in the volume of letter services is mainly caused by the fact that invoices are now sent through electronic channels.
"In a situation where the volume of letter services is decreasing and most customers visit post offices to send or receive parcels, we must prioritise the needs of our parcel business in the development of our network," said Aavo Kärmas, the Chairman of the Board of Omniva. "Therefore, we also need to update the requirements for our postal network. These requirements were established ten years ago primarily considering the needs of our letter service."
The spread of e-invoices supports the growth of our information business
The group's revenues from its information business services grew by 22% compared to the first quarter of 2015. The growth potential of our information business in Estonia is supported by the state’s plan to adopt machine-readable e-invoicing between the public and private sector by the end of 2016 as well as the European Commission’s plan to develop a common e-invoice standard for European countries by the end of 2016, which would facilitate cross-border e-invoicing.
Omniva is an international group that offers postal, logistics and information logistics services. The group comprises AS Eesti Post as the parent company, AS Maksekeskus, UAB Omniva LT in Lithuania and SIA Omniva in Latvia as its subsidiaries, and the affiliated company OÜ Post11. The principal activity of the parent company is the provision of postal, logistics and information logistics services, and the management of e-invoices (Omniva's invoice management solution). The principal activity SIA Omniva and UAB Omniva LT is the provision of parcel machine and courier services on the Latvian and Lithuanian markets. The area of activity of AS Maksekeskus is the provision of payment solutions to e-commerce companies in the Baltics. Post11 provides integrated international logistics solutions to online merchants to deliver goods all over the world.