Press release -
Post Office Annual Report Statement 2015-2016
- The Operating loss before subsidy more than halved from £57m to £24m
- Commercial turnover remained stable up from £976m to £981m
- Continued progress in the reduction of overall financial support required from government of £50m
- Over 6,000 branches now transformed, offering 200,000 extra opening hours every week and over 3,800 open on Sundays
The Post Office today (2 August 2016) announced its results for 2015-16, which show continued progress with the operating loss before subsidy more than halved from £57m to £24m.
The results show that the Post Office’s commercial turnover remained stable, up from £976m to £981m in the face of challenging market conditions. Total revenue decreased by £25m from £1,136m to £1,111m as a result of the planned reduction in the network subsidy payment (part of financial support from government), which reduced from £160m in 2014/15 to £130m in 2015/16.
It has grown revenue in Financial Services and Telecoms and maintained position in the Mails market, at the same time delivering a £28m reduction in costs across the business. This continued progress means that since 2013 the Post Office has reduced its loss before subsidy from £116m to £24m.
As well as improving its financial position, it has continued to deliver the biggest modernisation programme in UK retail history. By the end of March 2016, it had transformed more than 6,000 of its over 11,500 branches.
Modernised branches now offer an extra 200,000 opening hours a week and in June the Post Office announced it is now the largest retail network open seven days a week, with more than 3,800 branches now open on Sundays.
During the year the Post Office continued to invest strongly for the future, as reflected in the accounts.In addition to investment in its modernisation programme, it also acquired the other 50% of its insurance joint venture.
Paula Vennells, Chief Executive of the Post Office, said: “The results show that we are heading in the right direction and making steady progress towards commercial sustainability.
“We have achieved the progress so far by becoming simpler to run and by focusing on becoming better for customers. The fact that we have now modernised 6,000 branches, for example, shows our commitment to customers.
“It is greatly encouraging that we are continuing to head in the right direction.However, we operate in competitive and challenging markets and we must always remember that we are still a business that spends more money than it takes in. We are committed to transforming our business to ensure we have a sustainable network of branches at the heart of communities for future generations.”
Overview of Product Stream Performance
Financial Services revenue was up by 4.8% (£14m), driven by strong 19.7% growth in personal financial services (such as insurances), offsetting a decline in more traditional services such as bill payments.
Telecoms saw a growth of 8.3% (£10m), driven by strong performance in Homephone and Broadband, to deliver annual revenue of £130m.
Government Services turnover decreased by 9.2% (£13m) as a result of customers increasingly using online channel for motor vehicle licence payments and a decrease in DWP payments in relation to the Post Office Card Account. However, Home Office revenue has increased by £4m largely driven by passport Check & Send, biometric enrolment and increased use of identity related services.
Transactional volumes in mails increased slightly, although revenue in Mails and Retail slightly reduced to £380m. A good sales and service performance over the Christmas period saw a 3.6% increase in year-on-year trading income for that period.
The Post Office Report and Accounts can be found on the Post Office website.
Ends
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Post Office Press Office
20 Finsbury Street
London EC2Y 9AQ
Tel: 020 7012 3456 (24 hours),
Email: pressoffice@postoffice.co.uk
Twitter: @PostOfficeNews
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About the Post Office
The Post Office (Post Office Limited) has an unrivalled national network of over 11,500 branches across the UK, more than all the high street banks combined, and sits at the heart of communities in Northern Ireland, Scotland, Wales and England. The Post Office has made a commitment to maintaining its network of branches at its current size and reach. It provides around 170 different products and services spanning financial services including savings, insurance, loans, mortgages and credit cards; Government services; telephony; foreign currency; travel insurance and mail services.
The Post Office serves over 17 million customers a week and a third of small businesses. Some 99.7% of the total population live within three miles of a post office and over 97% live with one mile of a post office. For many rural communities, the post office is the only retail outlet. Post Offices branches remain highly valued and trusted, and are the focal point of many communities. For more information, visit http://www.postoffice.co.uk/.
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