Q3 2011 results PostNL

FY results likely to exceed guided range

7 November 2011 at 08:00 CET – The Hague

Highlights Q3 2011

  • Good operating results driven by Mail in NL volume development
  • International strong underlying improvement to €4 million (Q3 2010: €(5) million)
  • Underlying revenues down 2% to €996 million (organic plus 2%)
  • Underlying cash operating income €21 million (Q3 2010: €23 million)
  • Net debt position €1,053 million as at 1 October 2011
  • Stake in TNT Express: impairment €337 million
  • Coverage ratio main pension fund 96%, below minimum required level (around 105%)
  • Based on current parameters, stock dividend in 2012

CEO statement

Harry Koorstra, CEO of PostNL, states: ”The positive development in our operations was strongly continued in the third quarter: addressed mail volumes have developed better than expected, OPTA approved new stamp prices that will be effective as of January 2012 and step-by-step Master plan III is being rolled out. Parcels delivers as promised and shows good growth in volumes, revenues and results. International’s performance again improved and with the sale of the mailroom activities in Italy in October the focus on value realisation in International has been successfully concluded.

On the back of the operational performance during the first nine months of the year, I expect an underlying cash operating income for the full year above the top end of the €130 – 170 million range.

Since our last results, the financial markets have been extremely turbulent, leading to another impairment on the Express stake. Dutch interest rates are at historically low levels. The coverage ratio of the main pension fund dropped well below the minimum required level, resulting in possible substantial recovery payments in the period 2012 – 2014. In addition, regular pension premiums will probably increase from next year. All this will impact our capability of paying cash dividend the next few years.

We are looking at a variety of ways to mitigate some of the impact of the pension developments.

An improvement in the health of the economy could have a positive impact on pensions and dividend.”

Summary outlook 2011

PostNL expects underlying cash operating income to be above €170 million in 2011 mainly driven by better operational performance and the phasing of restructuring cash out. The phasing of the Master plans has developed in such a way that restructuring cash out and implementation costs in 2011 are running below the levels expected at the time we developed our plans. These costs will be incurred in 2012. Due to ongoing substitution and competition, in this second year after full liberalisation, the expected decline in addressed volumes in 2011 in the Netherlands is 8 – 10%. Master plan savings of €60 – 70 million are expected for the year.

About PostNL
Annually PostNL processes 8.8 billion addressed postal items (including 100 million parcels) and delivers to more than 88 million addresses in the Benelux, Germany, the UK and Italy. PostNL’s main business is mail, parcels and e-commerce. The company also provides services in the area of data and document management, direct marketing and fulfilment. PostNL employs some 77,000 people. In 2010 the company generated a turnover of nearly 4.3 billion euros. More information about PostNL can be found on its website www.postnl.com.

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