EANS-Adhoc: Österreichische Post AG AUSTRIAN POST INTRODUCES NEW PRICE STRUCTURE FOR MAIL AS OF MARCH 1, 2015 REGULATORY AUTHORITES APPROVE INFLATION ADJUSTMENT OF POSTAL RATES

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16.09.2014

Austrian Post is aligning its product and pricing structure to
reflect current market conditions. An inflation-related price
increase for mail will take place as of March 1, 2015, following the
last product and price reform in 2011. The adjustment in postal rates
was approved by the relevant regulatory authorities - the Post
Control Commission (PCK) and the Austrian Regulatory Authority for
Broadcasting and Telecommunications (RTR) - on September 15, 2014. In
addition, Austrian Post is making changes to its service portfolio to
facilitate customer access, for example the delivery of direct mail
or other shipping and handling options for mail items. This will
significantly facilitate the processing of postal business,
especially with respect to advertising mail for SMEs.

The introduction of a new postal rate structure is also designed to
ensure the medium-term balance between the structural decrease in the
mail business and the steady increase in staff costs. The objective
is to safeguard the long-term rendering of nationwide postal services
and maintain their top quality, also in European comparison. "This
inflation adjustment secures the sustainable development and
innovative strength of Austrian Post in spite of rising costs and
declining letter mail volumes. The ongoing expansion of modern
services and our product and service offering can also be seen in the
persistent modernisation of the branch network. 250 branch offices
were completely redesigned in just three years in order to further
improve service quality at the customer interface. Moreover, with
close to 1,900 postal service points, the availability of postal
services was considerably expanded in recent years. In future, we
also want to maintain and further upgrade our logistics
infrastructure and service quality for the benefit of the Austrian
economy", emphasises Georg Pölzl, Chief Executive Officer of Austrian
Post. The new inflation-based pricing structure has a mid-table
international ranking but, at the same time, offers superior service
quality, especially with respect to the quality of delivery and the
nationwide availability of postal service points. This has been
continually confirmed by international studies.

Rate for standard letters raised from 62 to 68 cents, large letters
from EUR 3.80 to 4.00 The price of standard domestic letters in the
"Premium" category (delivery on the next working day) will be raised
from 62 to 68 cents. The "Economy" option for letters sent by
business customers (longer delivery time, minimum of 1,000 items)
will now cost 62 cents per letter in line with the new postal rate
structure instead of 57 cents. The pricing adjustments are in a
comparable range for other formats, i.e. Standard Plus, Maxi and Maxi
Plus. For the "Large Letter" format extensively used in the field of
e-commerce, postage rates will rise slightly from EUR 3.80 to EUR
4.00 per mail item in order to enable Austrian Post to continue
offering an attractive letter mail product for the fast-growing
online shopping market. This change in postal rates, the first since
the year 2011, is aligned to the inflation rate since that time, in
spite of the fact that factor costs relevant to the postal business
such as staff costs or tolls have climbed more sharply in the same
period. The Consumer Price Index (CPI) has climbed by 10% since the
last tariff application was submitted. On average, the rise in postal
rates carried out by Austrian Post will lead to additional costs of
close to one euro each year for every Austrian citizen (average
postage expenses per person in Austria for sending letters equals EUR
12 per year). Slight adjustments will also be made in rates for
sending parcels effective January 1, 2015. For example, the cost of
sending a domestic parcel weighing up to 2 kg will rise from EUR 4.47
to EUR 4.60.

Customer-oriented further development of postal services "High
quality and the state-of-the-art development of the service portfolio
reflect the needs of customers and ensure the high attractiveness of
postal services. We are fighting for every letter through broad-based
sales initiatives, product innovations and the steady increase in
availability of the postal network. In future, we will prioritise our
investments designed to enhance customer convenience. For example,
one of our goals is to increase the number of Post Pick-up Boxes to
10,000 units," CEO Pölzl adds. These extensive investments will
continue in future in order to maintain the high level of services.
This is only possible on a medium to long term basis if
inflation-related factor cost rises are taken into account in the
pricing policy. For this reason, it is a matter of concern to
Austrian Post to have general rules put in place - as is the case in
other countries - designed to ensure that postal rates continually
keep pace with inflation in the future. In turn, this also increases
planning reliability for customers. At the same time, the further,
up-to-date development of universal postal services must also take
place, with the aim of aligning Austrian Post's products to the real
needs of customers, as well as to ensure an improved cost-benefit
ratio.

Long-term stable economic development On balance, Austrian Post is
striving to achieve a stable to slightly positive revenue development
in the Group in the medium to long term. The good development of the
company in recent years should be continued, and profitability
maintained. With the above-mentioned inflation adjustments, Austrian
Post strives to generate an EBITDA margin of around 12%. This also
provides the basis for continuing investments in new customer
solutions in spite of rising factor costs, and to move ahead with
modernising operations. In this regard, Austrian Post plans further
investments and efficiency increases. For example, Austrian Post aims
to promote models enabling civil servants working for the company to
transfer to the federal public service. This bundle of measures
should sustainably secure the profitability and innovative strength
of the company.

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

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

end of announcement euro adhoc
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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