Bpost announces an operating loss of 50.1 million euros for the third quarter. This is mainly the result of taking a provision of 75 million euros for overcharges in the past on three government contracts. Bpost hopes that the refund of 75 million will be sufficient to arrange this. Earlier this year, on April 24, Bpost spoke of an impact on operating profit of 25 million to 50 million, for the year 2023 alone.
Bpost has adjusted this to 10 million for 2023 plus the aforementioned provision. The various government services discussed on Thursday how they will act towards Bpost. This concerns the Ministries of Finance, Mobility and Justice. The most important file is that of Finance. That contract was not put out to tender in the past, but that is now changing.
Bpost does not yet know whether the government will agree to the 75 million. The next step is for the government to defend the scheme with the European Commission. The file can therefore hang above Bpost for a while.
The press concession is a separate file. According to interim financial director Koen Aelterman, there is no problem of overcompensation, but there is a problem of possible infringements of competition. Because Bpost was the first to bring the case to the competition watchdog, it could in principle avoid a fine.
Bpost hopes that the government will announce within a few weeks who will be allowed to operate the new press concession for the period 2024-2027. If Bpost wins the contract, the new concession will start on January 1. If it becomes a different player, Bpost may continue the current concession until June 30, so that the new player can warm up to the delivery of newspapers in particular.
Bpost had withdrawn its initial profit forecast of an operating profit of 240 to 260 million in April, but on Thursday the company said that it now expects an operating profit of at least 240 million for the entire year. That is without the provision for past files. The new forecast comes despite a 4.2 percent decline in third quarter revenues to 978.5 million.
The problem child is the North America branch, which saw its revenues fall by 17.6 percent. Excluding exchange rate effects, this is a decrease of 10.6 percent as a result of declining volumes at both Radial and Canadian Landmark. Only an operating margin of 0.8 percent was achieved on the 310 million turnover. As soon as the market picks up, a margin of 4 to 6 percent should be possible, Bpost says.
In Belgium, Bpost held up much better and delivered 5.5 percent more parcels in a shrinking market. Bpost managed to compensate for the decline in letter mail with price increases.