AusPost's $2bn plan for web shopping boom
The online shopping must get through. Photo: Michele Mossop
Australia Post will invest $2 billion under its ''future ready'' strategy to digitise its mail delivery services and increase its parcel sorting capacity to handle the increase in packages expected to flood the country from the online shopping boom.
The investment program, up more than 50 per cent on its typical capital expenditure budget, is the biggest spend by Australia Post and forms part of a larger strategy to transform its national logistics network and scoop up a greater share of the money being poured into internet commerce.
Unveiling the company's 2012 financial year result yesterday, Australia Post chief executive Ahmed Fahour said the $2 billion in investment would create a world-class parcel delivery network, improve automation and increase the group's capacity at its network of shops.
On Mr Fahour's checklist is by 2014 for 80 per cent of Australians in a metropolitan area to be within 10 minutes' drive of an after-hours parcel collection location - for shoppers picking up goods purchased online outside of business hours. By the end of the year, Australia Post will roll out 128 parcel locker locations across Australia.
''This investment will provide the infrastructure and delivery options to ensure Australian businesses and consumers can reap the benefits of the digital economy,'' Mr Fahour said.
Australia Post will invest $350 million in communications to help create and distribute its digital mailbox tool that will allow consumers to receive correspondence from businesses and government via a secure online mailbox.
The company will invest $450 million in its shops and consumer initiatives that include parcel lockers and Australia Post super stores.
A further $1.2 billion will be invested in its parcels capability, which includes the recent decision to buy 100 per cent of StarTrack for $400 million. This, with other investments in its parcel network, will allow Australia Post to double its parcel capacity by 2020.
Australia Post yesterday announced a group profit of $281 million, up 16.6 per cent, and the second year of profit growth under the ''future ready'' strategy. Revenue for 2012 increased slightly to $5.126 billion.
The company will pay the federal government a dividend of $213.7 million, up more than 20 per cent.
Despite the robust bottom line, Australia Post's traditional service, delivering regulated post, saw losses widen 15 per cent to $148 million on the back of mail volume and revenue declines.
That was countered by continued volume increases in parcel post and express deliveries, with parcels and retail profit of $546 million in Australia Post's unregulated business. Revenue for the business grew 8.5 per cent.