For the past month or so, An Post has been of those companies operating at the frontline, providing essential services to the State in the midst of the Covid-19 pandemic.
In economic terms, it has been a mixed blessing for the company, with parcel deliveries soaring but its letters division in freefall. Deliveries for Amazon are up 100 per cent year on year but with most businesses shuttered, mail deliveries have dried up.
The volume decline in letters for this year will be higher than the 7 per cent annual decline recorded in recent years.
In publishing its annual results on Friday, An Post said Covid-19 would have a “material” financial impact on the business, without putting a specific number on the hit. It has spent €1 million this year on protective equipment for staff.
Revenue down
The switch from mail to parcels has been under way at An Post for the past few years, with the State-owned company seeking to pivot away from letters and cash to parcels and financial services.
There was a familiar theme to its results. Revenue was down €4.8 million due to the drop in mail volumes but a €9 million decline in costs boosted its operating profit. The company was also bolstered by a €40 million gain from the sale of its share in the One4All gift voucher business founded by Michael Dawson.
Other “transformation” projects are also under way, including another automated parcels processing depot, and a move away from its historic offices in the GPO.
Two sites in the north docklands have been shortlisted as its new headquarters, and the company is pressing ahead with plans to make the switch in the first half of next year, regardless of Covid-19.
An Post’s trump card in the current crisis is the strength of its balance sheet. It had €143 million in cash at the end of last year, a war chest that will enable it to ride out the economic crisis caused by Covid-19, however long it lasts.
