EANS-Adhoc: AUSTRIAN POST H1 2010:y / SECOND-QUARTER INCREASE IN REVENUE AND EARNINGS LEADS TO STABLE HALF- YEAR RESULT AND IMPROVED CASH FLOW

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6-month report

11.08.2010

AUSTRIAN POST H1 2010:
SECOND-QUARTER INCREASE IN REVENUE AND EARNINGS LEADS TO STABLE HALF-
YEAR RESULT AND IMPROVED CASH FLOW

- Q2: Good second quarter leads to stable half-year - Revenue
+0.7%; EBIT +5.8% - H1: Half-year 2010 development confirms
forecasted trends - Decline in the Mail Division of -0.9% to EUR
682.1m due to electronic substitution - Growth in the Parcel &
Logistics Division of 4.3% to EUR 387.0m - Group revenue and EBIT
at the previous year´s level - Improved domestic and international
cost structure - Cost reduction measures have a positive impact
- Turnaround at subsidiaries begins to take hold - Cash flow reflects
efficient use of financial resources and good development -
Operating cash flow before changes in working capital and tax up
14.8% to EUR 115.3m - Free cash flow before the
acquisition/disposal of securities improves by 31.3% to EUR 46.3m

AUSTRIAN POST AT A GLANCE The business development of Austrian Post
in the first half of 2010 proceeded very satisfactorily. A good
second quarter revenue featuring a 0.7% revenue increase and an
earnings improvement of 5.8% led to a stable development in the first
six months of 2010 as a whole. Total Group revenue in the first
half- year amounted to EUR 1,150.1m, whereas EBIT was EUR 74.5m, at a
comparable level to the prior-year period.

Sales measures and innovations contributed to keeping the volume
decline in the Mail Division as low as possible. The revenue increase
of 4.3% in the Parcel & Logistics Division showed an ongoing rise in
transport volumes. Growth in the core business was even higher in the
light of the fact that unprofitable transport logistics operations
were terminated in Germany at the end of last year.

In order to counteract structural changes in the postal business,
Austrian Post will continue to take all the measures it considers
necessary to enhance the productivity of the company. Notable
successes with respect to operating costs and direct personnel
expenditures could already be achieved in the first half of 2010.
Cost reduction measures in Austria as well as the turnaround of
Austrian Post´s international subsidiaries are beginning to take
hold. The Branch Network Division is also undergoing constant
changes. Unprofitable company-operated branches are being
systematically converted into postal partner offices. Austrian Post
will continue to pursue its strategy of improving service quality and
the cost structure.

"We are on the right path, both in terms of the development of our
business operations as well as the implementation of strategic
measures", says Austrian Post CEO Georg Pölzl. "We have succeeded in
counteracting the revenue decline in the letter mail business for the
most part, and exploiting growth opportunities in the parcels
segment. Although our cost structure has substantially improved it is
absolutely essential to continue working on further enhancing
efficiency", Pölzl adds.

The measures Austrian Post is persistently implementing within the
context of its strategic programme Post@2011 are designed to exploit
revenue growth opportunities as well as to realise potential cost
savings.

The earnings strength of Austrian Post and the efficient use of
available financial resources is best demonstrated by the operating
cash flow before taxes, which was increased by 14.8% in the first
half-year 2010. Based on this development, we confirm our original
forecast for the year 2010. Revenue is expected to decrease by 1% to
2% from the comparable figure for 2009, but the EBITDA margin will
continue to be in a range between 10% and 12%.

REVENUE DEVELOPMENT IN DETAIL The revenue development of Austrian
Post in the first half-year 2010 confirmed the forecasted trends.
Whereas the Mail Division posted a decline, the Parcel & Logistics
Division reported continuing growth. On balance, the second quarter
proceeded extremely satisfactorily, reflected by a 0.7% revenue
increase. In the first half of 2010, total revenue of Austrian Post
was down by only 0.5% from the previous year to EUR 1,150.1m.

During the first six months of 2010, revenue of the Mail Division
only decreased by 0.9% in a year-on-year comparison. This can be
attributed to the gains achieved by the Infomail and Media Post
Business Areas. The main trends negatively affecting the Mail
Division continued, i.e. the electronic substitution of letters, the
declining business with high value mail items and the reduced weight
of the mail being posted. However, intensive efforts to attract
customers and innovative ideas limited the revenue decrease.
Similarly, one-off effects and an additional working day in the
second quarter in comparison to 2009 positively impacted the
performance of the Mail Division.

The Parcel & Logistics Division featured an ongoing rise in business
volume. Although the price situation remained tense, the division
profited from good volume development as well as an increase in new
customers. Despite the termination of unprofitable transport
logistics operations in Germany, revenue in the first half of 2010
rose 4.3% in a year-on-year comparison, and even climbed 6.0% in the
second quarter compared to the prior-year level.

The revenue and organisational structure of the Branch Network
Division is undergoing change. External sales decreased by EUR 15.2m,
whereas total costs were reduced by EUR 19.1m. The changed reporting
of revenue derived from sales of prepaid phone cards based on new
Austrian VAT regulations also contributed EUR 5.3m to the revenue
decline. Internal sales were down by EUR 7.3m due to the increasing
direct collection of letters and parcels from large customers.

Revenue by division

EURm H1 H1 Change Q2 Q2
2009 2010 % EURm 2009 2010
Total revenue 1,156.0 1,150.1 -0.5% -5.8 560.8 564.5
(external sales)
Mail 688.4 682.1 -0.9% -6.3 335.5 333.9
Parcel&Logistics 371.1 387.0 +4.3% +15.9 180.2 191.1
Branch Network 95.2 80.0 -16.0% -15.2 44.2 39.1
Other 2.1 2.6 +20.3% +0.4 0.4 1.2
Consolidation -0.9 -1.5 -71.3% -0.6 0.2 -0.8
Working days in Austria 122 123 --- --- 60 61
(Calendar)

Income Statement
EUR m H1 H1 Change Q2 Q2
2009 2010 % EURm 2009 2010
Revenue 1,156.0 1,150.1 -0.5% -5.8 560.8 564.5
EBITDA 126.5 124.8 -1.4% -1.8 54.3 56.4
EBIT 75.4 74.5 -1.1% -0.9 27.6 29.2
Profit for the period 56.2 54.1 -3.8% -2.1 22.5 20.6
Earnings per share (EUR) 0.83 0.80 -3.8% -0.03 0.33 0.31

Top management priorities at Austrian Post are to counteract the
revenue decline related to reduced letter mail volume and also
increase productivity and efficiency.

Staff costs comprise the largest operating expense item of Austrian
Post at EUR 562.1m, accounting for close to 50% of total revenue. In
addition to direct personnel expenditures for salaries and wages,
staff costs also encompass changes in staff-related provisions along
with restructuring costs in line with the voluntary social plan for
employees leaving the company.

Direct personnel expenditures could be reduced by about EUR 15m
compared to the first half of 2009. On average, the total workforce
decreased by 939 employees in a year-on-year comparison, to 24,961
people. Costs related to employee social plan payments such as
termination benefits and staff-related provisions amounted to
approximately EUR 18m.

Savings in operating costs were realised in the cost of raw
materials, consumables and services used as well as other operating
expenses. On balance, these net cost reductions in the first six
months of 2010 totalled EUR 11.1m compared to the preceding year. The
changed reporting of prepaid phone cards in the financial statements
of Austrian Post resulted in a reduction of EUR 5.3m. Further savings
were achieved with energy, fuel and heating costs.

Other operating income declined slightly to EUR 34.5m during the
period under review, including income from rents and leases of EUR
12.0m.

In the first half-year 2010, earnings before interest and tax (EBIT)
of Austrian Post only declined by 1.1%, or EUR 0.9m, to EUR 74.5m,
which is related to the fact that the revenue drop could be largely
compensated by cost savings. EBIT only decreased in the first quarter
of 2010, whereas it actually rose by 5.8% in the second quarter
compared to the prior-year level. The EBITDA margin was 10.9%, the
EBIT margin 6.5%.

In comparing earnings indicators, it is important to note that the
previous year´s performance was positively affected by proceeds of
EUR 4.4m derived from the sale of a 49.8% stake in Mader
Zeitschriftenverlags GmbH.

There was a change in the reporting of termination benefits relating
to the voluntary social plan for employees. Since the beginning of
2010, these expenses have been assigned to the particular division in
which they arise, whereas termination benefits had been previously
recognised in the other segment. On balance, employee social plan
payments totalled EUR 5.3m, of which the largest share or EUR 2.9m
was allocated to the Branch Network Division. Division earnings
excluding employee social plan payments changed as follows: The Mail
Division generated an EBIT increase of EUR 5.1m to EUR 119.6m in the
first half-year 2010. EBIT of the Parcel & Logistics Division rose by
EUR 9.6m to EUR 6.2m, whereas EBIT at the Branch Network Division
declined by EUR 4.8m to minus EUR 8.7m.

EBIT excluding social plan payments of the Other segment fell from
minus EUR 26.7m to minus EUR 37.3m.This encompasses, amongst other
items, non-allocated costs for central departments, expenses in
connection with unused properties as well as the change in
staff-related provisions. The provisions allocated for employees who
accepted the voluntary social plan putting them on temporary leave
until they reach retirement rose by EUR 7m. All in all, the provision
for employee under-utilisation and the provision for employees
transferring to the Austrian federal government remained constant for
the most part.

The other financial result of Austrian Post declined from minus EUR
0.1m to minus EUR 4.0m in the first half-year 2010, which is related,
amongst other factors, to lower interest rates.

Earnings before tax fell by EUR 4.7m to EUR 70.6m. After deducting
income taxes totalling EUR 16.5m, the Group net profit (profit after
tax for the period) amounted to EUR 54.1m, corresponding to earnings
of EUR 0.80 per share for the first half of the 2010 financial year,
compared to EUR 0.83 per share in the first half of 2009.

BALANCE SHEET WITH HIGH EQUITY RATIO Austrian Post takes a
risk-adverse business approach. This is demonstrated by its high
equity ratio, the relatively low level of financial liabilities and
the high amount of cash and cash equivalents.

All in all, the analysis of the balance sheet of Austrian Post shows
a considerable level of current and non-current financial resources.
Austrian Post had cash and cash equivalents of EUR 243.4m as at June
30, 2010, and financial investments in securities amounting to EUR
52.6m.

Accordingly, the financial resources at the disposal of Austrian Post
in the first half of 2010 totalled EUR 296.0m at the end of June
2010. As opposed to the total financial resources of Austrian Post,
financial liabilities only amount to EUR 128.4m. The Equity ratio was
37.3%

IMPROVED CASH FLOW Operating cash flow before changes in working
capital amounted to EUR 80.7m in the first half of 2010. This decline
of EUR 2.0m is primarily due to different income tax payments in the
half-year comparison. The operating cash flow before changes in
working capital and taxes was EUR 115.3m, a rise of 14.8% from the
previous year´s level.

The cash flow from changes in working capital amounted to minus EUR
21.9m in the first half of 2010, primarily as the result of a lower
level of liabilities. On balance, the cash flow from operating
activities in the first half-year 2010 totalled EUR 58.8m, compared
to EUR 58.9m in the comparable period of 2009.

The cash flow from investing activities at minus EUR 7.5m includes
the purchase of property, plant and equipment (CAPEX) amounting to
EUR 14.9m, and proceeds from the disposal of property, plant and
equipment of EUR 5.8m.

The free cash flow was EUR 51.3m. The improved operating performance
is reflected in the free cash flow before the acquisition or disposal
of securities, which climbed by 31.3% to EUR 46.3m, a rise of EUR
11.0m above the previous year´s level.

EMPLOYEES During the period under review, the average number of
full-time employees at Austrian Post fell by 3.6%, or 939 people, to
24,961. This decline can be primarily attributed to the lower number
of employees working for the Mail and Branch Network Divisions and in
the Other segment.

Most of Austrian Post`s labour force (20,720 full-time equivalent
employees) is employed by the parent company, Österreichische Post
AG. More than 4,000 employees are employed by subsidiaries.

OUTLOOK 2010 Current trends in the letter mail and parcels businesses
confirm the forecasted development. Austrian Post continues to
predict a Group revenue decrease of between 1% and 2% in 2010
compared to 2009.

Revenue in the Mail Division will further decline, primarily as a
result of electronic substitution and the lower weight of mail items
being posted. The Parcel & Logistics Division showed an ongoing
improvement in revenue from the parcels business. This situation is
expected to continue during the course of the year in line with
current economic forecasts.

A series of measures have been implemented in order to exploit
potential cost savings. Austrian Post aims to achieve a sustainable
EBITDA margin of 10-12% annually, in 2010 as well as in subsequent
years.

With regard to the expected financing requirements for 2010, Austrian
Post anticipates total capital expenditure to reach a level of about
EUR 65m. The priority in Austrian Post´s international business will
be to further integrate and expand existing networks, and to improve
the operating results of its subsidiaries, which are expected to
generate a sustained earnings contribution in 2010.

PERFORMANCE OF DIVISIONS MAIL DIVISION External sales of the Mail
Division only fell by 0.9% in the first half of 2010 from the
comparable period of 2009, to EUR 682.1m. The second quarter decrease
was only 0.4%.

Revenue generated by the Letter Mail Business Area declined and were
down by 2.8% or EUR 10.3m from the prior-year period. The trend
towards the substitution of letters by electronic media is
continuing, for example in the customer segments of financial
services and telecommunications. A decline was also evident in other
areas as well as in the public sector, which cut back on the number
of registered letters it posted. In contrast, elections and the
related possibility of casting absentee ballots as well as one
additional working day compared to the preceding year had positive
one-off effects in the first half-year 2010.

In the first half of 2010, the revenue achieved by the Infomail
Business Area (addressed and unaddressed direct mail items) rose by
1.5% or EUR 3.8m compared to the prior-year level. The Infomail
Business Area was characterised by a positive volume development
along with lower average weights of mail items. Efforts to acquire
new customers were successful, and could thus compensate for the loss
of the large customer Quelle.

Revenue of the Media Post Business Area increased by 0.4% or EUR 0.3m
due to the growing business volume generated by company magazines.

On balance, the Mail Division posted an EBIT excluding employee
social plan payments of EUR 119.6m, a rise of 4.5%, or EUR 5.1m from
the comparable period of the previous year. This earnings improvement
is primarily related to efficiency increases. Both operating expenses
and staff costs could be reduced.

PARCEL & LOGISTICS DIVISION In the first half of 2010, external sales
of the Parcel & Logistics Division climbed by 4.3%, to EUR 387.0m as
a consequence of the good volume development. The parcel and
logistics market showed an overall trend towards volume growth in the
first six months of 2010, although price pressure continued.

The premium parcel product segment (parcel delivery within 24 hours)
generated total revenue of EUR 303.9m in the first half-year. The
revenue decline of 0.3%, is primarily due to the termination of
loss-making transport logistics operations in Germany. Adjusted
revenue in this German product segment actually rose by about 8%
year-on-year, which is mainly related to new customer acquisition.
The subsidiary trans-o-flex in Germany accounts for approximately
three quarters of premium parcel revenue. The volume of business
parcels in South East and Eastern Europe also development very
positively.

Revenue of the standard parcels product segment in Austria developed
more gratifyingly, rising by close to 30%, to EUR 78.1m. The main
reasons for this positive development were organic growth, the
increased mail order business since June 2009 as well as parcel
volumes shifted from the premium to the standard segment.

There was a turnaround in the performance of the Parcel & Logistics
Division. In the first half of 2010, EBIT excluding employee social
plan payments rose to EUR 6.2m compared to the negative results of
minus EUR 3.4m in the first half- year 2009.

Carl-Gerold Mende, member of the Management Board with responsibility
for the Parcel & Logistics Division, informed the Supervisory Board
of his decision to fulfill his employment contract until June 2011
but for personal reasons not to exercise his option of having the
contract extended until 2013. "We respect the personal decision of
Mr. Mende. He will continue to carry out his responsibilities with
complete dedication and successfully press ahead with the growth
strategy of the Parcel & Logistics Division", says Peter Michaelis,
Chairman of the Supervisory board.

BRANCH NETWORK DIVISION The organisation of the branch network is
undergoing change, which impacts sales as well as the cost structure.
External sales of the Branch Network Division fell by EUR 15.2m in
the first six months of 2010, whereas total costs were reduced by EUR
19.1m.

Part of the revenue decline, or EUR 5.3m, is related to the changed
reporting of revenue from prepaid calling cards as the result of new
Austrian VAT regulations. During the 2009 financial year, the nominal
value of prepaid calling cards was still recognised as revenue,
whereas the related costs of the goods sold were reported as raw
materials, consumables and services used. Since January 1, 2010, only
the commission derived from prepaid calling card sales is recognised.
Moreover, sales of retail products declined in the first half-year
2010. In particular, telecommunications products in the field of
mobile telephony are subject to increasing market saturation.

Financial services and the related commissions earned also showed a
downward trend, which is attributable to reduced margins and the
current low interest rate environment.

Internal sales with postal services also further decreased, and fell
by 7.9%. There has been a fundamental reduction in the volume of
letters posted and subsequently transported by the branch network.
Moreover, letters are increasingly being picked up directly from
customers prior to market liberalisation.

The service and cost structure of the branch network is being
continually improved as a result of the structural change taking
place in the Branch Network Division. Unprofitable company-operated
branches in Austria are being converted by Austrian Post into
partner-operated postal service points.

Austrian Post had a total of 1,807 postal service points at the end
of June 2010, including 756 operated by external partners. The
conversion of additional company-operated branches to postal partner
offices is in preparation.

EBIT of the Branch Network Division excluding social plan payments
amounted to minus EUR 8.7m in the first half of 2010, down from minus
EUR 4.0m in the comparable period of 2009. The workforce of the
Branch Network Division was reduced by 387 employees compared to the
prior-year period. Employee social plan payments amounted to EUR
2.9m.

Vienna, August 11, 2010

The half year financial report H1 2010 is available in the internet:
www.post.at/ir/en -> Publications --> Financial Reports

end of announcement euro adhoc
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ots Originaltext: Österreichische Post AG
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:

Austrian Post

Head of Investor Relations

Mr. Harald Hagenauer

Tel.: +43 (0) 57767 - 30400

Head of Group Communications

Ms. Ina Sabitzer

Tel.: +43 (0) 57767 - 21763

ina.sabitzer@post.at

Group Communication/Press Spokesman

Mr. Michael Homola

Tel.: +43 (0) 57767 - 32010

michael.homola@post.at

Branche: Transport
ISIN: AT0000APOST4
WKN: A0JML5
Index: ATX Prime, ATX
Börsen: Wien / Regulated free trade