Post Office profits
During the year under review, the Sapo maintained its unbroken six-year record of profitable trading by producing a R488 million pre-tax profit.
“This is despite an extremely challenging financial year, which saw turmoil in international financial markets reduce postal revenues and hike input costs,” the Sapo said.
“The strong results strengthen the case for improved delivery at the Sapo.”
Although profits declined slightly as a consequence of the depressed economy and the drop in postal volumes, the results showed the Sapo had “continued to deliver steadily improving trading profits since its turnaround in 2004”.
The year saw a 5.8 percent decline in mail volumes, the first in seven years, the Sapo said.
“However, to counter the adverse conditions in the trading environment during the past financial year, the Sapo embarked on a strategy of tighter cost controls and improving efficiencies across all its operations as well as exploring potential new revenue streams,” it said.
Group chief executive officer, Motshoanetsi Lefoka said the positive results achieved at a time of unprecedented turmoil in global markets indicated that the turnaround achieved by the Sapo in the past five years had created a sound platform on which to grow further successes.
“The positive results are a means to the end of improving delivery towards a world class postal, logistics and financial services to all South Africans,” Lefoka said.
He said revenues for the 2009 financial year were up eight percent on the previous year to a total of R6 billion
“However, profit before tax declined 14 percent on the previous year –from R565 million to R488 million — as a result of higher input costs, especially fuel and salary costs.”
Operating expenses were up 10 percent, reflecting the Sapo’s higher cost operating environment.
As a result, the profit margin declined two percent from 10.1percent in 2008 to 8.1 percent, he said.
In spite of this, the Sapo’s total assets increased 13 percent to R8.7 billion, Lefoka said.
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