CTT's revenue stabilised at 355M€ and profits went up in the first semester..
Despite its core postal business going down, CTT’s revenue stabilised at 355M€ this first half of the year. And, for the first time, the semester’s profits went up 21% to 9M€ as a result of the restructuring process that has impacted last year’s accounts. These were also the first results after Francisco de Lacerda’s exit from CTT’s leadership, being replaced by João Bento on the 22nd of May.
In a reaction to the report’s heartwarming conclusions, the new CEO highlighted “CTT’s return to net income’s growth, reinforcing the operational income’s stability and confirming the positive outcome of 321 Crédito’s acquisition”.
“CTT will keep implementing its Operational Transformation Plan to accomplish the saving goals already announced while reinforcing both its proximity to the population and the quality of its service”, João Bento said, adding the company will keep betting on “innovation and efficiency”.
There was good and bad news in the semester’s report, though. First, the bad ones: the company did not manage to stop postal service’s losses, which still represents 70% of CTT’s revenue stream. The operational income of the postal service dropped by 4.4% to 240.7M€ with less post sent and fewer stamps bought. However, express mail and deliveries, even though still being business levers, showed a turnover of 72.8M€.
The good news is: CTT bank saw its revenues increased by 50% to 23.6M€ due to the acquisition of 321 Crédito and the payments’ business segment. The last has generated a revenue of 15.6M€ (+24.1%).
CTT was still able to drain the operational costs as they were reduced by 0.1% to 308.6M€. There were several containment measures announced by Lacerda at the end of 2017, being the most mediatic the board salaries’ cut. The restructuration occurred last year, cutting the number of post offices and workers as well as dividends.
Most recently, ECO advanced that João Bento kept going with the cuts’ policy in the administration. The CEO and the board renounced to 25% of their salaries until the end of their mandates, coming into force on the 1st of July. Other top-ranking officers suffered a salary cut of 15%. All summed up, it is estimated that CTT saved 500,000€ with just this measure.
CTT also updated its strategic priorities as the investment’s budget will be cut down from 55 to 45M€, alongside a bet on alienating some real estate assets as long as the market conditions are favourable to it.