An Post pretax loss at €25.6m as Postbank stake takes toll

AN POST recorded a pretax loss of €25.6 million in 2009, in part due to mounting losses on its stake in Postbank. Weaker turnover and a substantial pension-related charge also contributed.

Postbank, a joint venture between An Post and BNP Paribas Fortis, is being wound down and is in the process of negotiating redundancy terms with employees.

It is understood that a redundancy deal has been agreed between Postbank and worker representatives, who are recommending the package to their members.

“The process is ongoing and we are hopeful for a resolution,” a spokesman for Postbank said.

An Post’s turnover came under pressure last year as traditional mail volumes contracted by 10 per cent.

However, the decline was somewhat offset by a pick-up in demand for post office-based financial services.

Overall, the company’s turnover was down 5.4 per cent at €804.2 million.

Although the State-owned organisation managed to shave €20.3 million off its operating costs, bringing them down to just under €800 million, it moved from a net profit of €33.2 million in 2008 to a loss of €25.6 million last year.

The bulk of this loss relates to an accounting charge of €20.5 million based on the severe decline in the company’s pension fund assets in 2008.

This charge is expected to come in at €5 million for 2009, due to an improvement in the fund’s performance. An Post’s pension deficit fell from €582 million in 2008 to €403 million last year, but its pension scheme still falls well short of meeting the necessary minimum funding standard.

The company said that it is developing a plan to address this situation.

An Post experienced strong demand for its financial services in 2009, with customers investing an additional €1.8 billion in State savings products. The company intends to widen its revenue base by increasing its range of products and services. It will expand its financial offerings with the National Solidarity Bond, which was launched yesterday.

It is also expected to announce plans imminently to offer limited banking services to customers of National Irish Bank.

Subject to approval from the regulator, this will operate along the same lines as currently available to AIB customers at An Post outlets.