Australia Post is set to report its first full-year loss for the first time since 2015, driven by “unstoppable” letter losses.
Australia Post managed to deliver a before-tax profit of $23.6 million for the six months to December 2022, an 88.2 per cent drop from the same period the prior year’s $199.8 million take.
Parcels revenue during the half was $3.8 billion, a 1.6 per cent drop year-on-year.
However, letter losses have risen by 171.5 per cent from a year earlier to reach $189.7 million for the half. A stamp bump from $1.10 and $1.20 did little to stem the flow.
CEO Paul Graham has warned it will post a full-year loss.
“We are at a crossroads and the headwinds facing our business have never been stronger,” he said, flagging that “further changes to the way we operate are necessary”.
This suggests a mass round of sackings will come soon.
Eagle-eyed observers will notice the $28 million in bonuses paid to AusPost’s top-tier staffers at the end of last year is more than $23.6 million – providing a very easy way to make a profit.
Graham is blaming the letters, however, which make up less than 15 per cent of delivered mail.
“For more than a decade, Australia Post has been flagging concerns about the long-term viability of the business as it currently operates,” Graham said.
“During the COVID-19 lockdowns we benefitted from a considerable boost to our parcels business, which has now abated and revealed the unsustainable nature of the status quo.
“Every year it’s costing Australia Post more to deliver fewer letters,” he said. “We know letters are in an unstoppable decline, thanks largely to digital communications, yet letter costs are rising due to the increasing number of delivery points we service every day.”
“This all contributes to increased losses and is a global issue facing all postal services. We expect annual volumes will decline further, with Australian households receiving less than one letter per week by the end of the decade.”
