The economic slowdown had an impact on Omniva’s Q3 results

The economic slowdown had an impact on Omniva’s Q3 results

The sales revenue of Omniva group for the first nine months of 2023 totalled 94.7 million euros, which is almost 10% more than in the same period last year.

The group incurred a net loss of 1.9 million euros in the first three quarters. This was largely due to the income tax paid on dividends, but in addition to that, the operating results of the group are negatively affected by the provision of the unprofitable universal postal service.

The sales revenue of the group for the first nine months of 2023 was 94.7 million euros (2022: 86.7 million euros). 59 per cent of the sales revenue came from Estonia, 15 per cent from Lithuania, 10 per cent from Latvia, and 16 per cent from international transit. The universal postal service accounted for 9 per cent of the turnover. Operating income totalled 96.4 million euros (in 2022: 91.0 million euros), growing by 6 per cent compared to the same period last year. The group incurred an operating loss of 0.4 million euros (2022: operating loss of 0.7 million euros).

‘The sales results of the third quarter show a general cooling of the economic environment. The competition related to this cooling is now affecting price pressure, and as a result, the sales turnover in the third quarter fell short of expectations, regardless of the good volumes,’ said Mart Mägi, Chairman of the Management Board of Omniva. ‘The takeover of the early morning delivery helped to boost revenues, but the quality of service was unsatisfactory. To improve the service, Omniva is constantly taking new steps, from renovating post offices and training its staff to building new sorting centres. We are pleased to have already received several international awards as the fastest-growing postal company in the region,’ he added.

Omniva’s major activities in the third quarter

The cornerstone was laid for the region’s most modern package sorting terminal in Kaunas, scheduled for completion in 2024. Omniva is investing more than 40 million euros in the new parcel sorting terminal and the sorting technology to be installed there, making it the group’s largest single investment to date.

Omniva continued to renovate its post offices: during the first three quarters of the year, updated post offices were opened in Sillamäe, Rapla, Narva, Pärnu, Viimsi, and Kohtla-Järve. Omniva also continued to expand its network of new parcel machines: this year, Omniva will install nearly 40 new parcel machines in Estonia and replace several dozen outdated machines with new ones. In August, Omniva added 42 new environmentally friendly Renault Kangoo ZE electric cars to its fleet to provide a greener parcel and postal service.

In spring, the company acquired Parcelsea’s network of 700 private parcel machines – a personal parcel machine installed outside a commercial building or at the front gate of a home can be rented by anyone and couriers and private individuals alike can leave parcels there. To make the use and image of the parcel machine easy to understand for everyone, the name of the network was changed: Picapac, a stylised version of ‘pick a pack’.

In the second quarter, Omniva launched a new service of early-morning postal delivery in Viljandi, Pärnu, Tartu, and Tallinn. AS Express Post, which had previously been providing the early-morning delivery service, ceased the provision and Omniva took over the service, but there were various problems at the start. The biggest challenge was the recruitment of postal couriers, especially in Harju County, but in Q3, the company was able to get the processes running smoothly and the carrier rate is now more than 99%.

In addition, Omniva contributed nearly 1.2 million euros to the increase in wages at the primary level, which raised the salaries of 950 frontline employees from 1 July.

The activities of Omniva were also highlighted internationally. The Universal Postal Union (UPU) has recognised Estonia and Omniva as a leader of the postal sector in Europe and Central Asia. This recognition is based on the Integrated Index for Postal Development, which assesses the scope, relevance, reliability, and resilience of a country’s postal service.

In the third quarter, Omniva also started preparations for the global and local shopping holidays before the end of the year, which boost volumes every year.

The consolidated interim report (in Estonian) for the third quarter of 2023 has been published on Omniva’s website.

Omniva (AS Eesti Post) is a company owned by the Estonian state, the main activity of which is the provision of logistics services (parcel and postal services), digital services, and international transit services. The main activity of SIA Omniva and UAB Omniva LT is the provision of parcel machine and courier services in the Latvian and Lithuanian markets, respectively. UAB Omniva LT Sorting was established for the construction of a new logistics centre in Kaunas. The main activity of OÜ Picapac is the development of technological solutions for parcel machines and the provision of personalised parcel services. The main activity of OÜ Finbite is the provision of information business services (e-invoices).