Operating profit (EBIT) decreased from 640 million to 593 million francs.
In the first nine months of 2016, Swiss Post generated Group profit of 466 million francs, 37 million francs less than in the prior-year period. The operating profit of 593 million francs was 47 million francs below the prior-year figure. This decrease 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. At 6,039 million francs, operating income was on a par with the previous year (6,015 million francs).
In the communication market, Swiss Post recorded an operating profit of 94 million francs in the first three quarters of 2016 (previous year: 166 million francs). The decline in profit generated by Post Offices & Sales is principally due to the Group unit’s new internal cost allocation. Operating profit at PostMail fell by 11 million francs to 235 million francs, while Swiss Post Solutions increased its contribution to the result by 5 million to 15 million francs. The decline in the volume of addressed letters was more pronounced: the number fell by almost 4 percent.
In the logistics market, PostLogistics recorded an operating profit of 73 million francs (previous year: 95 million francs). The logistics market continues to be characterized by increasing competition and price pressure, both nationally and internationally. Despite additional income from the 5.6 percent rise in parcel volumes (previous year: + 2.5 percent) and increased demand for value logistics solutions, operating profit fell. This decline is due to modifications to the Group unit’s internal cost allocation.
In the passenger transport market, PostBus increased its operating profit by one million francs to 30 million francs thanks to the low price of fuel. As the budgets of the public entities which act as contracting bodies for transport services are squeezed, the pressure on prices continues to rise.
Sharp decline in interest income
Operating EBIT at PostFinance declined in the first nine months of 2016, principally as a result of the sharp decline in interest income (-93 million francs year-on-year). Thanks to non-recurring revenue from the sale of equity holdings and a participation, PostFinance nonetheless generated operating profit (EBIT) of 410 million francs (previous year: 351 million francs). Despite this, the negative trend in business operations will continue in the coming years, as it is increasingly difficult for PostFinance to find profitable investments for the customer deposits entrusted to it in the current negative interest rate environment due to the lending prohibition.
Source: Swiss Post