NZ Post chief executive Sir Brian Roche announced he was leaving the role in April after indicating last year he would leave the state-owned entity early this year.
NZ Post (not including Kiwibank) reported a profit after tax of $35million for the six months, down from the $37million reported in the previous corresponding period.
Revenue from operations fell nearly 9% to $467million from $513million and expenditure fell nearly 13% to $446million from $511million.
The profit from Kiwi Group Holdings, which has 47% ownership by the New Zealand Super Fund and Accident Compensation Commission reported a net profit of $65million in the period, down 11% from $73million.
NZ Post received a $54million share of the Kiwi Group profit to take its reported profit to $89million, down from the $110million last year when it owned all of Kiwibank.
Sir Brian said the result for the postal services, which excluded one-off items, was up $15million on the same period last year.
The improvement was attributable to the benefits flowing through from cost savings over the past three years, more efficient delivery of mail and parcels and a 7.5% increase in parcel volumes in the six-month period. He was encouraged by the turnaround in the postal services business performance from a year ago.
``This is a strong first-half result. Given we face the same challenge every year of having to combat the $20million to $30million in revenue we lose annually due to the decline in letters, we are pleased our strategy is delivering and putting the postal services business further in the black.''
Online shopping continued to boom as more businesses embraced e-commerce, Sir Brian said.
NZ Post was now in a better position to capture more of the growth, the major difference from where the company was in this time last year. The sale on October 31 last year of 47% of the group shareholding in Kiwi Group, for $493.5million had put the postal services business on a strong financial footing and able to take advantage of growth opportunities, he said.
A gain of $25million was realised on the partial sale and the remaining 53% shareholding was valued at $709million at balance date. Debt of $180million had been repaid and an interim special dividend of $100million would be paid to the Crown. Kiwi Group chief executive Paul Brock said the result was in line with expectations. Deposit and lending growth continued to improve but financial results had been affected by funding pressures, continued investment in the bank's infrastructure and, to a lesser extent, the Kaikoura earthquake. Total lending in the six months increased 4.4% from $16.7billion to $17.4billion, customer deposits increased 3.9% from $14.8billion to $15.4million, impaired assets fell to 0.05% of total loans and advances and funds under management increased 8% to $4.2billion. Lending activity continued to grow, although at lower margins than the previous period.
Most banks had a renewed focus on increasing customer deposits. Domestic deposits continued to provide essential funding for more than 80% of Kiwibank's lending which insulated it to a degree from volatile international markets. Continued growth in small to medium business banking was particularly encouraging, he said.
``This has always been a major target area for Kiwibank and the potential for further growth is significant.''
New Zealand was built on small businesses and there was a natural alignment between those businesses and a New Zealand-owned company like Kiwibank, Mr Brock said.
