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UPDATE 1-PostNL sees FY profit at low end of target range
August 6, 2012 / 6:35 AM / 5 years ago

UPDATE 1-PostNL sees FY profit at low end of target range

AMSTERDAM, Aug 6 (Reuters) - Dutch postal group PostNL , under pressure to improve performance as mail volumes decline, warned that its full-year profit would be at the low end of its target range as it struggles to overhaul its domestic business.

PostNL, the largest shareholder in TNT Express, the parcel delivery company being bought by UPS for 5.2 billion euros ($6.42 billion), said its underlying cash operating income in 2012 would be at the bottom end of a 110 million - 160 million euro range.

“The outlook is sensitive to further developments” in the Dutch real estate market and implementation of a long-term corporate restructuring, PostNL said in a statement.

PostNL said underlying second-quarter operating profit (EBIT) rose 9 percent to 97 million euros on revenue up 1.6 percent at 1.04 billion.

However, underlying cash operating income in the quarter fell a sharp 60 percent to 10 million euros, due to a poor performance in the Dutch mail operations and higher provisions.

PostNL was forced to delay the implementation of an electronic mail sorting system in its core Dutch mail business due to technical problems, resulting in higher delivery costs and a delay in restructuring plans.

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