EANS-Adhoc: Österreichische Post AG / AUSTRIAN POST 2013: SLIGHT RISE IN REVENUE AND EARNINGS IMPROVEMENT; OUTLOOK 2014 SHOWS CONTINUITY (with document)

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Financial Figures/Balance Sheet/annual report
13.03.2014

- Market environment - Positive revenue effects due to elections
dampen volume decline in the Austrian mail business - Ongoing
robust growth in the Austrian parcel market - Strong competitive
pressure in the international parcel business - Higher revenue -
Revenue increase of 0.8% in 2013 (excl. Benelux) - Slight growth
both in the mail and parcel businesses (excl. Benelux) - Further
earnings improvement - Slightly improved EBIT of EUR 186.0m despite
impairment losses - Earnings negatively impacted by special effects
- Strong cash flow and solid balance sheet - Stable cash flow
finances future-oriented investments and dividends - Solid balance
sheet structure with low level of debt - Attractive dividends -
Continuation of attractive dividend policy - Dividend proposal of
EUR 1.90 per share to the Annual General Meeting - Outlook for 2014
reflects continuity - Stable revenue development targeted in a
challenging market environment - Goal achieving an EBITDA margin of
10-12% and improved EBIT

OVERVIEW OF AUSTRIAN POST Austrian Post showed a good performance in
the 2013 financial year against the backdrop of a challenging
business environment on the postal and logistics markets. Revenue
increased by 0.8% in the reporting period compared to the prior-year
figure adjusted to take account of the Benelux subsidiaries divested
by Austrian Post in 2012. This positive revenue development was due
to growth in the parcel business as well as in the company's
strategic international investments. At the same time, positive
revenue effects from elections and referendums helped cushion the
steady volume decline in the mail segment. This structural trend of
declining letter mail volumes as a consequence of electronic
substitution is continuing. Moreover, the advertising spending of
several customers, and thus the revenue derived from direct mail
items, was subject to cyclical fluctuations. In addition to the
pressure on physical outlets resulting from e-commerce, a market
consolidation process in the retail sector was perceptible. In
contrast, clear growth was generated in the parcel business, both in
Austria and in South East and Eastern Europe, whereas parcel revenue
in the German market declined slightly. The Group's operating profit
featuring an EBIT of EUR 186.0m was slightly higher than in the
previous year, but was impacted by special measures carried out in
the third quarter of 2013. EBIT included positive effects on
provisions, along with impairment losses on goodwill for the
trans-o-flex Group in the amount of EUR 27.0m. Earnings per share
amounted to EUR 1.82, at the same level as in the previous year,
whereas both years included write-downs in the financial result. "We
can be satisfied with our performance in 2013. The increase in
revenue and earnings once again demonstrates that the strategic path
we have chosen is the right one. In the future, we will also pursue
growth in the parcel business and in our international business in
order to compensate for declining mail volumes. In this regard, all
our activities will be consistently oriented towards the needs of our
customers, in order to consequently increase our service level", says
Chief Executive Officer Georg Pölzl. "The 2013 financial year was
fully geared to implementing extensive future-oriented investments,
such as for our new logistics centre in Upper Austria. The good
earnings and cash flow development also enables us to continue our
attractive dividend policy", Pölzl adds. The Management Board of
Austrian Post will propose the distribution of a dividend of EUR 1.90
per share for approval by the Annual General Meeting planned for
April 24, 2014. Austrian Post aims to achieve a stable revenue
development again. With respect to earnings, the targeted EBITDA
margin in the range of 10% to 12% is confirmed. In addition, the
company is also striving to generate a further improvement in its
EBIT. The operating cash flow generated by Austrian Post will
continue to be prudently and purposefully used to finance sustainable
efficiency improvements, structural measures and future-oriented
investments.

REVENUE DEVELOPMENT IN DETAIL Austrian Post reported total revenue of
EUR 2,366.8m in 2013, at the same level as in the previous year.
Adjusted to take account of the revenue of EUR 17.3m generated by the
Benelux subsidiaries, which Austrian Post divested in the first half
of 2012, the year-on-year revenue increase actually amounted to 0.8%.
Revenue of the Mail & Branch Network Division rose by 0.2% to EUR
1,510.8m. The positive revenue effects of new Group companies and
elections and referendums in Austria were reflected in both the
Letter Mail and Direct Mail segments. In the Letter Mail & Mail
Solutions business area, revenue improved by 1.2% from the prior-year
period to EUR 793.7m. The substitution of letter mail by electronic
media is continuing as before. Decreases took place, for example, in
the telecommunications customer segment and in the public sector. In
contrast, various elections provided added impetus, due to the fact
that the option of voting by absentee ballot has emerged as a popular
instrument of direct democracy. New services offered in the field of
Mail Solutions also posted growth. However, the basic trend of
declining letter mail volumes continues. Revenue in the Direct Mail
business fell by 0.8% in 2013 to EUR 441.8m. This field is
particularly impacted by fluctuations in the economy and advertising
behaviour. The weaker economy and the pressure exerted by online
business on retail stores led to dampened advertising spending on the
part of several customers. Moreover, a market consolidation process
was perceptible in the retail sector. The year 2013 was generally
characterised by declining direct mail volumes, especially in the
unaddressed segment, as well as greater volatility of the advertising
industry. In the Parcel & Logistics Division, revenue in the 2013
financial year, adjusted to take account of the disposed subsidiaries
in the Benelux region, rose by 2.0% to EUR 857.3m. From a regional
perspective, the Austrian parcel market generated the strongest
growth, with revenue up 7.8%, whereas revenue declined in Germany.
Premium Parcels (parcel delivery within 24 hours), which are mainly
used in the business-to-business segment, generated revenue of EUR
643.7m in 2013, a decrease of 1.1% from the previous year. This
decline is primarily due to the deconsolidation of the Benelux
subsidiaries as well as the downward trend in Germany. Adjusted to
take account of the former Benelux subsidiaries, the Premium Parcel
business actually posted a 1.3% rise in revenue. Disproportionately
high growth was generated with business customer parcels as well as
higher quality private customer parcels in Austria. The Standard
Parcel business, which mainly involves shipments to private customers
in Austria, also posted growth, with revenue up 2.2% to EUR 181.7m.
Revenue of EUR 32.0m was achieved in the field of Other Parcel
Services, which encompasses various complementary logistics services
such as fulfilment, warehousing and value logistics (e.g. the
transport of cash and valuables). This represents an increase of
8.2%. From a regional perspective, 57% of total revenue in the Parcel
& Logistics Division was generated in Germany, 35% in Austria and 8%
by the Austrian Post subsidiaries in South East and Eastern Europe.
The Austrian and CEE markets developed very positively, whereas in
Germany revenue achieved by the subsidiary trans-o-flex was down by
1.8% due to the challenging competitive environment. At the same
time, revenue growth in Austria reached a level of 7.8%, driven by
the trend towards online shopping as well as the higher market share
in the business parcel segment. On balance, the South East and
Eastern European subsidiaries posted revenue growth of 6.2%.

EXPENSE AND EARNINGS DEVELOPMENT Staff costs comprise a major portion
of the cost structure of Austrian Post. Accordingly, 47.8% of the
total operating expenses incurred by Austrian Post in 2013 can be
attributed to staff costs. The second largest expense item accounting
for 33.6% of operating expenses is raw materials, consumables and
services used, of which a large part relates to external transport
services. Other operating expenses represent 13.3% of the total
costs, and 5.3% is attributable to depreciation and amortisation. The
item raw materials, consumables and services used declined by 1.8% in
the reporting period to EUR 753.3m. This development is primarily due
to the decrease in costs for external transport services. In
particular in Germany, the business model of the trans-o-flex Group
was always characterised by a high level of external value creation.
This was reduced in 2013 by the acquisition of distribution companies
as well as optimisation measures implemented in the network. Total
staff costs of Austrian Post in 2013 were down 1.6% or EUR 17.9m from
the prior-year level to EUR 1,073.5m. The decrease is mainly due to
lower non-operational staff costs. Operational staff costs, which
mainly consist of salaries, wages, jubilee benefits, bonuses and
auxiliary wage costs amounted to EUR 1,043.1m in the reporting period
and were at approximately the same level as in the previous year.
Persistent efficiency enhancement measures succeeded in counteracting
regular salary increases. Moreover, the implemented measures also
offset additional staff costs from newly acquired companies in South
East and Eastern Europe as well as higher staff costs in Germany. On
balance, the average number of employees (full-time equivalents)
working for Austrian Post amounted to 24,211 people in 2013, compared
to 23,181 employees in 2012. Non-operational staff costs totalled EUR
30.4m in 2013. In addition to severance payments, this figure also
includes changes in provisions, which are primarily related to the
specific employment situation of civil servants at Austrian Post.
Accordingly, provisions were allocated in 2013 for social plans,
employee under-utilisation and the voluntary transfer of employees to
the federal public service. Costs for termination benefits amounting
to EUR 26.5m in the 2013 financial year were at the prior-year level.
In contrast, the expenses for provisions for employee
under-utilisation, including the provisions for employees
transferring to the federal public service, were reduced by EUR 17.6m
in 2013. The fact that several programmes for employees impacted by
restructuring measures could be carried out more quickly than
originally expected positively impacted the provisions for employee
under-utilisation. Similarly, the year 2013 also saw a positive
effect with respect to the provision for employees transferring to
the federal public service. In the 2013 financial year, EBITDA of the
Austrian Post Group increased to EUR 304.5m. The rise of EUR 33.3m
can be largely attributed to the previously-mentioned positive effect
on provisions in non-operational staff costs in the amount of EUR
17.6m. As a consequence of this special effect, the EBITDA margin
improved to 12.9%. On balance, depreciation, amortisation and
impairment losses totalled EUR 118.5m during the period under review.
This includes the impairment loss on goodwill for the trans-o-flex
Group in the amount of EUR 27.0m, which is related to the intensely
competitive market situation and the reduced earnings situation of
the company. Other impairment losses totalled EUR 8.1m, slightly
above the comparable prior-year figure of EUR 7.2m. Taking account of
the two special effects with respect to staff costs and depreciation,
amortisation and impairments, earnings before interest and tax (EBIT)
totalled EUR 186.0m, a rise of 2.0% from the previous year. The
corresponding EBIT margin was 7.9%. The other financial result of
Austrian Post amounted to minus EUR 14.8m in 2013. This includes the
complete write-down on receivables arising from shareholder loans to
the amount of EUR 10.6m from the joint venture company MEILLERGHP.
The underlying reason for this write-down is the current difficult
market environment, the uncertain development of the company and the
subordinated nature of the loans. The other financial result in 2012
also included the write-down of Austrian Post's indirect shareholding
in the bank BAWAG P.S.K. in the amount of EUR 28.4m. The tax burden
in 2013 totalled EUR 47.2m. After deducting the income tax, the Group
net profit (profit after tax for the period) amounted to EUR 124.0m,
a rise of 0.7% from the previous year. Thus, earnings per share
remained at a constant level of EUR 1.82 for the 2013 financial year.
From a divisional perspective, the company's earnings situation is
also impacted by the above-mentioned special effects. The Mail &
Branch Network Division generated an EBITDA of EUR 320.7m, a rise of
4.4%, and an EBIT of EUR 281.8m, up 3.4% from the previous year. This
improvement can be attributed to the positive revenue effects in the
election year 2013 as well as the fact that earnings in the
prior-year period were negatively impacted by an impairment loss of
EUR 9.6m recognised for Austrian Post's stake in MEILLERGHP. EBITDA
of the Parcel & Logistics Division in 2013 amounted to EUR 42.8m,
whereas EBIT totalled minus EUR 4.9m. This includes the EUR 27.0m
impairment loss on goodwill for the trans-o-flex Group as well as
write-downs on receivables to the amount of EUR 7.1m. The efficiency
enhancement programme in the trans-o-flex Group includes the
reintegration of external services by acquiring selected distribution
partners. Four distribution companies in Germany (Locations: Hürth
near Cologne, Duisburg, Dortmund and Meinerzhagen) were acquired in
the fourth quarter of 2013 to ensure that these services comprise
part of the company's own value creation. The objective is to
optimise operating costs and exploit synergies in the field of
distribution logistics. The Corporate Division basically encompasses
all expenses for central departments in the Group as well as
staff-related provisions and the earnings contribution of selected
new business areas. In addition, the division also encompasses
innovation management and the development of new business models. The
above-mentioned reduced expenses for staff-related provisions in 2013
resulted in an improved EBIT of minus EUR 90.9m compared to minus EUR
115.4m in the previous year (including consolidation).

CASH FLOW AND BALANCE SHEET In the 2013 financial year, operating
cash flow before changes in working capital totalled EUR 299.4m,
above the prior-year level. On balance, the changes in net working
capital totalled minus EUR 49.0m during the period under review,
compared to minus EUR 29.8m in 2012. The difference can be mainly
attributed to the reduction in liabilities as well as the use of
current provisions. As a result of this development, the cash flow
from operating activities amounted to EUR 250.4m, slightly above the
comparable prior-year figure.

The cash flow from investing activities of minus EUR 189.9m in 2013 was
primarily impacted by higher cash outflows for acquisitions and capital
expenditures. Payments for the purchase of property, plant and equipment (CAPEX)
totalled EUR 96.4m during the period under review, including investments of EUR
23.4m for property, plant and equipment relating to the new logistics centre in
Upper Austria, which will be completed by the middle of 2014. In addition, cash
outflows of EUR 69.0m related to payments for acquisitions. The main part, or
approximately EUR 50m, was for the acquisition of a 25% stake in the Turkish
company Aras Kargo a.s. Moreover, there was a change of minus EUR 24.3m in the
cash flow relating to the securities portfolio, which mainly involved a shift of
investments of cash and cash equivalents to securities. On balance, the free
cash flow before acquisitions and securities was EUR 153.9m in 2013.
Austrian Post pursues a conservative balance sheet and financing structure. This
is demonstrated by the high equity ratio, the low amount of financial
liabilities and the solid level of cash and cash equivalents invested with the
least possible risk. Equity of the Austrian Post Group amounted to EUR 699.4m at
the end of December 2013, comprising an equity ratio of 42.6% (incl. equity
attributable to non-controlling interests of EUR 2.3m). The available financial
resources at the disposal of the Austrian Post Group (cash and cash equivalents
and securities) amounted to EUR 305.2m, current and non-current financial
liabilities only totalled EUR 21.0m.

EMPLOYEES

The average number of full-time employees at the Austrian Post Group
totalled 24,211 people during the period under review, comprising an
increase of 1,030 employees from the prior-year period. This rise can
be mainly attributed to the newly acquired subsidiaries in Bulgaria,
Romania, Germany, Austria and Poland, which employed about 1,600
people (full-time equivalents) in the 2013 financial year. Most of
Austrian Post's staff (full-time equivalents) is employed by the
parent company Österreichische Post AG (a total of 18,951 full-time
equivalents). A total of 5,260 people (full-time equivalents) are
employed by the subsidiaries.

OUTLOOK 2014 On the basis of the available economic data, the core
region of Austrian Post is expected to show a slightly upward
economic growth trend in 2014. The basic trends in the postal sector
are set to persist. Revenue in the mail segment will continue to be
impacted by the ongoing volume decline for traditional addressed
letter mail due to electronic substitution. In Austria, new
regulations stipulating the obligatory electronic delivery of
official government mail are expected to have an impact on the
business in 2014. In line with international trends, the decrease in
letter mail volume is likely to amount to 3-5%. The market for
addressed and unaddressed direct mail items will continue to be
subject to a volatile volume development. The reduced weight of
shipments in some customer segments, for example in the mail order
business, could have a negative effect on revenue. Moreover, there is
the risk of losing revenue from individual customers due to further
market consolidation in the retail sector. The development of the
parcel and logistics business is also dominated by two trends. In the
private customer parcel segment, growth of 3-6% is anticipated,
depending on the region. The steadily growing field of e-commerce is
the driving force behind this increase. The positive development of
the business parcel segment depends on a stable economy and the
competitive situation. It is crucial to exploit the company's good
strategic market position and the resulting revenue potential,
especially in the international parcel business. Following the slight
revenue increases in recent years - plus 1.9% in 2012 and plus 0.8%
in 2013 excluding the divested Benelux subsidiaries - Austrian Post
is striving to achieve an ongoing stable revenue development in 2014,
in which the decrease in mail revenue can be compensated by higher
parcel revenue. The efficiency of the services provided must always
be a key focus in the postal business. Structures and processes in
both mail and parcel logistics will be consistently improved. The new
automation and sorting technologies will enable Austrian Post to
consistently exploit cost reduction potential. Profitability is the
top priority in the company's international business operations, both
in terms of concentrating on the core business as well as in ensuring
efficient value creation. With respect to its earnings development,
Austrian Post remains committed to its target of achieving a
sustainable EBITDA margin in the range of 10-12%. The company is also
striving to improve its earnings before interest and tax (EBIT) in
2014. The operating cash flow generated by Austrian Post will
continue to be used prudently and in a targeted manner to finance
sustainable efficiency increases, structural measures and
future-oriented investments. One priority of the investments being
made in 2013 and 2014 is the new logistics centre under construction
in Upper Austria. As a result, capital expenditure is expected to
reach a level of about EUR 100m again in 2014. Other investments will
mainly focus on modernisation, replacement of existing facilities and
vehicles and capacity expansion in the parcel segment. The Management
Board will propose to the Annual General Meeting scheduled for April
24, 2014 to approve the distribution of a dividend totalling EUR 1.90
per share for the 2013 financial year. Thus, the company is once
again continuing its attractive dividend policy on the basis of a
solid balance sheet structure and the generated cash flow. Austrian
Post aims to distribute at least 75% of the Group's net profit to its
shareholders. Assuming the company continues its successful business
development, the dividend should develop further in line with the
Group's net results.

The Annual Financial Report 2013 is available on the Internet at
www.post.at/ir --> Publications --> Financial Reports.

Attachments with Announcement:
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Further inquiry note:
Austrian Post
Harald Hagenauer
Head of Investor Relations, Corporate Governance, Group Auditing & Compliance
Tel.: +43 (0) 57767-30400
harald.hagenauer@post.at

Austrian Post
Ingeborg Gratzer
Head of Press Relations & Internal Communications
Tel.: +43 (0) 57767-24730
ingeborg.gratzer@post.at

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issuer: Österreichische Post AG
Haidingergasse 1
A-1030 Wien
phone: +43 (0)57767-0
mail: investor@post.at
WWW: www.post.at
sector: Transport
ISIN: AT0000APOST4
indexes: ATX Prime, ATX
stockmarkets: official market: Wien
language: English