Post Office Suffers Almost R360m Loss In Previous Financial Year

THE South African Post Office posted a net loss of R358.88m for the year ended March 31 2014, a 6.5% increase on the loss of R337.12m declared in the previous financial year.

According to the Post Office’s latest annual report tabled in Parliament on Tuesday, the revenue loss was caused by lower-than-expected revenues as consumers found other service providers, the lack of government funding for its universal service obligations, and an unprotected labour strike that ended in November.

The posted loss was less than a quarter of the estimated R1.3bn loss that Post Office auditors told Parliament last year to expect in the year to March 2015.

The problems at the Post Office meant that the release of its annual report was delayed by four months. All state-owned entities have to send their annual reports and financial statements to Parliament by the end of September.

Acting Post Office group CEO Mlu Mathonsi said group revenue had risen by 2% to R5.78bn from R5.69bn in 2013. However, the decline in mail and courier volumes and the loss of customers was slightly outweighed by the 5% general price increase granted by the postal regulator for products and reserved services.

An example of a reserved Post Office service is the rule that all items with a weight of less than 1kg have to be transported by the Post Office.

Regarding the labour unrest, Mr Mathonsi said it had contributed to the losses and that additional costs were incurred to clear the postal backlogs caused by the unprotected strike.

He said the lower revenues were, to some extent, offset by the implementation of cost optimisation programmes and containment measures across the group that resulted in operating expenses being limited to R6.51bn (2013: R6.08bn) — a rise of 7%.

The Post Office’s balance sheet was strengthened, with an increase of R530m in the value of the total assets to R11.29bn, from R10.76bn in 2013.

Mr Mathonsi said the growth in total assets resulted from the increase of R308m in short-term assets to match the growth of R245m in the Postbank depositor funds.

-BDlive

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