23-02-2023
Philippe Dartienne, CEO a.i. of bpostgroup: “I am pleased with the solid set of results of the fourth quarter, reflecting our meticulous preparation and the strong execution of the peak. For the year, despite persisting macro headwinds, bpostgroup managed to absorb the downside risk pressures to the initial EBIT guidance of 280-310 mEUR. This is a great achievement and I want to thank all our employees for their relentless efforts and the implementation of the actions taken by the Management to counter the market disruptions we have faced throughout the year.
We have clear priorities for 2023 and, while facing economic uncertainty and lasting macro headwinds in the coming months, bpostgroup continues to execute on its strategy and to progress on its growth and transformation journey.”
Management priorities for 2023
The Management continues to deliver on the ongoing execution of the bpostgroup’ strategy, with the ambition to:
Develop into a leading international e-commerce and logistics service provider
Reinvent, secure and grow our anchorage services in Belgium to citizens, businesses and public institutions
Be a reference in sustainability in all markets the group operates in
In line with this ambition, the 2023 priorities are:
Belgium:
Develop target operating model and supporting organization, based on client-centricity translating in higher quality and flexibility
Prepare for future of press concessions under different scenarios
Increase the wellbeing of our employees to improve absenteeism-levels
E-Logistics Eurasia:
Continue top-line growth for Radial, Active Ants and Cross-Border
Further boost commercial performance by means of sales excellence program and cross-selling (supported by common CRM)
Launch execution of Dyna multi-year turnaround plan
E-Logistics North America:
Develop and execute on commercial pipelines across entities adjusting to changed market conditions
Implement network-wide lean operating model for Radial, incl. reduction of SG&A, driving further margin improvement
Group:
Reinforce compliance programs
Continue portfolio optimization, including pursuit of M&A
Simplification of business processes and technology landscape
Appoint and onboard new Group CEO
Outlook for 2023
bpostgroup expects1 its adjusted EBIT 2023 to range between 240-260 mEUR. bpostgroup will continue to execute on its transformation while facing market pressures with sales, pricing, cost and productivity levers.
The group’s total operating income for 2023 is expected to increase by a mid- single-digit percentage 2,4 compared to 2022.
For the business units, bpostgroup expects:
Belgium:
3 to 5% growth2 in total operating income, notably driven by:
Mail: an underlying Domestic mail volume decline expected between -8% and -10%, offset by price increase and mix impacts.
Parcel: a mid-single digit percentage volume growth and a mid- to high single-digit percentage price/mix impact.
6.5 to 8.5% adjusted EBIT margin including higher payroll costs from full-year impact of the 2022 salary indexations and the additional ones of 20233, higher energy costs, partly mitigated by some efficiency gains in operations and continued cost reduction initiatives.
E-Logistics Eurasia:
Low double digit percentage growth in total operating income, driven by:
Continued growth of Radial Europe and Active Ants, and
Growing Commercial Cross-Border activities incl. development of new lanes, more than offsetting structural decline in Postal.
3 to 5% adjusted EBIT margin reflecting a negative mix effect at Cross-Border and including scale-up of sales organization and start-up costs of new customers at Radial Europe and Active Ants.
E-Logistics North America:
Slightly lower4 total operating income reflecting:
Amazon’s insourcing at Landmark Global and general price pressure.
Lower growth momentum at Radial in current market conditions, and overcapacity leading to price pressures.
4 to 6% adjusted EBIT margin from tighter labor costs, labor management and costs measures, offsetting price pressures and higher opex and incremental depreciation and amortization from new sites.
Group EBIT will include higher payroll costs at Corporate level and operating expenses to support the ongoing group transformation, as well as impacts from the ongoing “press concession” investigation.
Gross capex is expected to be around 200 mEUR. This capex envelope is geared towards growing e-commerce logistics.
The dividend relative to the results of the year 2023 will be in the range of 30-50% of IFRS net profit, and will be payable in May 2024 after the General Shareholders’ Meeting, in accordance with the dividend policy.
Source: bpost