New Post

1
New Zealand Post Annual ReportMedia presentation
23 September 2005
A Broader Perspective
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2004/2005 Year In Review

• A significant financial result - 137.2m Net
  Profit After Tax
• 58.6m net profit excluding the gain on
  divestment (78.6m) from joint venture with DHL
  for Express Couriers Limited (increase of 60.5
  ahead on last years 36.5m)
• Overall result also driven by continued strong
  performance of Postal Services Group, Express
  Couriers Limited and a maiden year profit from
  Kiwibank
• 8.3m contribution from the sale of Christchurch
  Mail Centre and Whangarei Post Office

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Key Financials
12 months to 30 June 05
12 months to 30 June 04
Profit after tax 137.2m 36.5m
Operating Revenue 1,208.9m 1,055.4m Operating
Expenses 1,044.7m 990.5m EBIT (incl. gain on
divestment) 168.2m 73.4m EBIT (excl. gain on
divestment) 89.6m 73.4m Total dividend 50.0m
21.9m EVA 19.7m 10.3m
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Profit After Tax

• 2004/2005 net surplus is highest ever achieved

Million
(Year Ending March to 2000, Year Ending June from
and including 2001) Note 2005 includes 78.6m
ECL gain on divestment
G-1
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Dividends and Taxes

• Total dividends of 50m included 23m from
  surplus available funds
• Since incorporation, New Zealand Post has paid
  almost 1 billion in dividends and taxes

Million
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Revenue

• Revenue for the New Zealand Post Group increased
  14.5 on last year (including gain on divestment,
  7.1 excluding gain on divestment)
• Kiwibank revenue rose 37 driven by strong growth
  in Kiwibank customer deposits
• 1.4 increase in letters volumes saw Postal
  Services Group revenue increase 5
• From 1 January the 50 investment in ECL was
  equity accounted for resulting in a decrease in
  comparative revenue numbers

2001 2002 2003 2004 2005
Operating revenue ( millions)
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Operating Expenditure

• Expenses increased to 1.04 billion
• Increase largely attributable to full year
  consolidation of the OSA Group, wage increases
  and higher personnel levels, in particular in
  Kiwibank and the Retail Network.

2001 2002 2003 2004 2005
Operating expenditure ( millions)
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Balance Sheet
Financial Position as at 30 June 2005
Credit rating AA-
30 June 2005 30 June 2004
Total Funds Employed
2,506m 1,875m
483m 350m
Equity
1,689m 1,165m
Kiwibank liabilities
Current liabilities
204m 230m
Non-current liabilities
130m 130m
Total Assets
2,506m 1,875m
Current assets
263m 214m
Kiwibank banking assets
1,814m 1,255m
Fixed assets
329m 305m
Other non-current assets
100m 101m
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Strategic Enablers

• To be customer driven
• To create a high performing culture
• To reinvent our processes
• To grow the business

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Customer and Personal Communication

• Despite pressures on letter volumes, overall
  volumes increased 1.4 on the previous year but
  full-rate mail volumes were down 2
• People are using mail in different ways with
  growth of 7.4 seen in packets and parcels
• International Outbound airmail packets grew 8
  and parcels 11
• Changing mix of mail has created challenges
  including a fall in service performance to
  94.8, although bulk mail volumes consistently
  achieved over 96 on time delivery

• Strong growth in business mail volumes of 5 over
  same period last year
• Major mailings from Electoral Enrolment Centre,
  banks and other financial institutions
  contributed to growth

2002 2003 2004 2005
increase in business mail volumes
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Banking and Payments

• Kiwibank maiden year profit of 7.2 million
  recorded
• Excellent financial performance of Kiwibank with
  customer deposits growing to 1.42 billion and
  home loans at 1.57 billion
• Number of initiatives including business banking,
  ATM roll out and text messaging service launched
• Continued strong growth with more than 354,000
  retail customers Kiwibank and the network
  extended to 307 branches

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Physical Goods Distribution

• 90m received (incl. 78.6m gain on divestment)
  following formation of joint venture with DHL
  which was announced in December 2004
• Decision to enter into 5050 joint venture driven
  by a number of factors including the opportunity
  to further expand warehousing and logistics
  capabilities
• Re-branding of 750 vans, 40 trucks, 3 motorbikes,
  16 bicycles and over 800 uniformed couriers
• Secured major contract with Netlink worth 30m
  over five years to distribute magazines
  throughout New Zealand

13
Document and Information Management

• Appointment of new CEO with responsibility across
  the Datamail Group of companies
• Primarily a year of consolidation for the
  Datamail Group
• 2004 TUANZ Innovation Award won for
  TelstraClears adoption of Datamails RightNow
  online customer solution product
• Increased shareholding of Outsource Solutions
  Limited from 68 to 87
• ECN Group, a provider of a range of electronic
  message exchange, integration, business process
  management and email messaging services achieved
  significant customers wins and saw 40 revenue
  increase

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The coming year

• Target improved profit (excluding
  extraordinaries)
• Ensuring the sustainability of our postal
  services business
• Support Kiwibanks growth
• Developing Express Couriers Joint Venture with
  DHL
• Strengthening our document and information
  management capability

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Annual report presentation

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