Covid-19 penalizes CTT. Profit drops to 3.7 million euros
The company recorded profits of 3.7 million euros between January and March, a year-on-year decrease of 0.4%. Company highlights the impact of virus on business.
CTT saw profits drop slightly in the first quarter of the year. They fell by 0.4% to 3.7 million euros, with the company highlighting the negative impact of the pandemic on its business, especially in the second fortnight of March.
According to the company in a statement, operating revenues were growing by 7.4% in the first two months of the year, including the inorganic effect of the purchase of 321 Crédito bank, “which illustrates the robust performance that the company was achieving in its business lines until the acceleration of the effects of the pandemic.”
However, the virus has spread throughout the country, forcing the government to take restrictive measures that have negatively affected the business of many companies, including CTT.
The company led by João Bento says EBITDA fell 3.7% to 20.2 million euros in the first quarter, “due to the significant impact of Covid-19 in March”. CTT noticed a reverse in the performance of this result, which was growing at a very high rate (up 49.7%) in the first two months of 2020.
“This good start of the year has, for now, cushioned the significant impact of the economic crisis resulting from the pandemic, which has already materialized in a significant drop in revenue in the second fortnight of March,” says João Bento.
Bank and parcels contradict fall in mail
In the first quarter of this year, the CTT maintained what has been the trends of the last ones: The Post Office business in decline and growth of the Express and Parcels segment and Banco CTT.
With the Post Office, the revenues fell almost 10% to 109.5 million euros. “The business was very affected in the second half of March,” justify CTT. Without the impact of the pandemic, this sector lost only 2% in January and February.
The company states that the Express and Parcels business was also affected, especially in Spain. Several initiatives were launched in Portugal to help companies market their products online, with the delivery service of CTT. In this scenario, revenues amounted to 37.3 million euros, an increase of 1.6% compared to the same period last year.
As for Banco CTT, the effects of the virus outbreak “were less significant” and “allowed the bank to present, for the first time in its history, a positive result in the quarter”. The bank’s income more than doubled to 19.5 million euros, of which 8 million came from 321 Crédito, an institution acquired in May 2019.
In Financial Services and Retail, revenues grew 23% to 13 million euros, a performance-driven by the increase in Public Debt Certificates subscriptions in January and February (yielding 6.6 million euros). However, with the coronavirus pandemic, the subscriptions saw up to 75% decline in the second fortnight of March over the previous one.
