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Parcels-delivery service is booming: Australia Post

Rapid e-commerce growth has seen great success for the parcel delivery division of national courier, Australia Post.

The strength of the parcels-delivery business overshadows losses in letter volumes which totalled $255.7 million in FY2022, up from $205.7 million in FY2021.

“The success of our parcels service has been a great story for Australia Post and the community, but it has obscured the significant structural challenges in our letters service which are deepening and beginning to significantly impact our financial performance,” said Australia Post Group CEO and Managing Director, Paul Graham.

“Over the past three years, parcels delivery revenue has increased by 65 per cent, while letters revenue has fallen by more than 17 per cent.

“While we remain committed to meeting the needs of the community, the ongoing and rapid decline in the letters business is not sustainable. As we flagged in our full year results, it’s clear that losses in this business are expected to continue into the future, and at an accelerating rate.”

Graham said revenue from Australia Post’s letters services is declining because people are sending fewer letters. Simultaneously, the cost of delivering letters is increasing while the number of delivery points is growing.

Demand for online services has also seen a reduction in the number of Australia Post customers accessing post offices.

“Despite the headwinds, we are continuing to invest in our digital technology, network capability, and parcels business, which operates in a highly competitive environment,” said Graham.

“This will help to meet the needs and expectations of customers and communities, as digitisation continues to fundamentally change the consumer landscape.”

Last month, Australia Post launched its 2025 Sustainability Roadmap which formally supports the Australian Government’s commitment to achieving net zero emissions by 2050.

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