Poste Italiane presented its accounts as at 30 June. Net profit grows by 57,2% in the quarter compared to the same period of 2017. A leap forward that brings half-year profit to 735 million (+44,1%), thanks to the increase in the operating result, explains the press release from the company led by Matteo Del Fante. The current six-month report marks the first direct comparison with the season of Francesco Caio who preceded him and remained in office until the entire first quarter of 2017.
Since his arrival, therefore, Del Fante has begun to leave his mark on Poste. And after the presentation of the Deliver 2022 plan, he is reaping the results. Looking at the note from Poste, revenues fell by 4,5% in the quarter and by 1,3% in the six months to 5,4 billion. The only sector with revenues on the increase is that of payments (including mobile and digital) which brings half-yearly revenues to 307 million, an increase of 10,4%. However, consolidated operating costs decreased by 6,4% compared to the second quarter of 2017 and by 5,9% compared to the first half of 2017 due to fewer employees and greater efficiency. The consequence is a strong improvement in the operating result to 350 million in the quarter, with an increase of 9% and equal to 1,1 billion in the half year (+24,3%) and an improvement in all operating sectors.
THE COMEBACK SPREAD AND THE SOLVENCY RATIO KNOB
At 11, the Poste stock lost 3,29% on the Stock Exchange to 7,6 euros. The performance of the share then worsened, reaching a drop of almost 5% in the afternoon as the half-yearly report revealed that Poste Italiane suffered a marked drop in the solvency ratio of the subsidiary Poste Vita due to the volatility of BTPs recorded in the second quarter of the year, after the vote in March.
The ratio between equity capital and the solvency capital requirement fell to 185% at the end of June, compared to 279% at the end of 2017, explained Tiziano Ceccarani, head of Poste Italiane's Planning & Control and Financial Reporting during the conference call with analysts . Matteo Del Fante specified that PosteVita is part of a group that has little debt, and that there is no capital problem for the subsidiary. But he said he was ready to intervene if necessary to reassure the market.
At the end of 2017, Poste Italiane had government bonds worth 134 billion in its belly. If the yield on BTPs increases, the value of those already subscribed actually decreases, Del Fante explained, however assuring that Poste Italiane has already started investing in securities with higher than expected rates, offsetting the decline in the solvency ratio
Parcel volumes are growing and the total assets under management reached €510 billion in June 2018, with an increase of €4 billion compared to 2017 with net inflows of €4,4 billion in the first half of 2018, supported by life products, deposits and mutual funds.
PARCELS AND FINANCIAL SERVICES
Going into more detail, i parcel volumes record a 40% increase in B2C volumes in the half year against a price reduction and B2B shift, including international parcels while in the insurance services sector revenues amounted to €685 million in the first half of 2018 (€361 million in the second quarter of 2018). Poste Italiane is rebalancing its insurance portfolio under the Deliver 2022 plan. The operating result increased thanks to the contribution of the non-life business and the operating profit amounted to 216 million in the second quarter of 2018 (+5,4%) and to 360 million for the second half (+2,9%).
Revenues from Financial Services stop at 2,7 billion (-1,3%) due to the lower capital gains. However, commissions deriving from postal savings increased: they increased by 7%, equal to 444 million in the quarter, reaching 894 million in the half year (+16%), thanks to the agreement signed six months ago with Cassa Depositi e Prestiti and the greater commercial commitment on the product.
With these data, Matteo Del Frante confirms the objectives for 2018 “both at group and business unit level. We will continue to aim high to guarantee an offer of quality products and services adapted to the new needs of our customers".
Updated 15:50pm Thursday 2nd August
