Pos Malaysia profit dips 86% on higher costs, lower revenue

The national courier continues to invest in tech and business process optimisation to improve Pos Laju

By MARK RAO / Pic By MUHD AMIN NAHARUL

Pos Malaysia Bhd’s first-quarter (1Q) earnings slumped due to the increased expenses incurred and lower turnover from key businesses.

The national courier’s net profit declined 86.1% year-on-year (YoY) to RM4.98 million, while revenue slipped 3.5% YoY to RM590.46 million due to higher sales costs, operating expenses and finance costs incurred during the quarter, coupled with drop in revenue from the postal, logistics and international segments.

The postal services business was hit with a 10% decline in mail volume due to electronic substitution, bringing revenue down by 11% YoY to RM172 million for the quarter ended June 30, according to its exchange filing last Friday.

Turnover from the international and logistics divisions were down on the loss in a major customer’s account and the Refinery and Petrochemical Integrated Development project being in the final stage of completion respectively. The courier business — the company’s largest revenue contributor at 34.6% of group revenue in 1Q — continued to perform well due to increased e-commerce demand and a larger online business customer base.

CEO Al-Ishsal Ishak said the company continues to invest in technology and business process optimisation to improve its Pos Laju omni-channel customer experience.

“We recognise an untapped market for e-commerce products within the postal reserved area to fulfil the increasing demands from our customers for the competitively priced, non-time sensitive delivery options,” he said in a statement last Friday.

“Our data indicates this to be a tangible opportunity for Pos Mel, particularly for inbound e-commerce items from China.”

Pos Malaysia currently operates the largest last-mile network and infrastructure in Malaysia, which facilitates the flow of e-commerce items.

For the postal services segment, the firm is offering digital mail-related services and is migrating its over-the-counter service offerings onto digital platforms to offset the volume decline in traditional mail.

The company is planning to consolidate its logistic assets, in line with industry conditions, while entering new markets such as the transportation of bulk commodities.

This is due to overcapacity in the logistics industry, coupled with the consolidation of major infrastructure projects.

Pos Malaysia currently has a network of over 3,700 touch points across Malaysia.