Friday June 15, 2012
Pos Malaysia to diversify
It wants to depend less on mail business, to go into high growth areas
“We want to reduce our dependency on mail.
“We will look into opportunities to diversify revenue by venturing into high growth areas. We will also expand into the digital business,” he said in a briefing to announce the second stage of its transformation plan and financial results.
Khalid said the postal group had been highly dependent on the mail business which accounted for 62% of its total revenue of RM1.48bil for the 15 months ended March 31. The company posted a net profit of RM138.8mil for the 15 months period. Pos Malaysia has changed its financial year ending to March 31 from December 31 previously.
“We already have a number of digital businesses such as corporate mail management and direct mail,” Khalid said, adding that in future Pos Malaysia would be a solution-driven company.
The second stage transformation plan which will be guided by five strategic thrusts, SCORE, involves diversification of Pos Malaysia's income stream in supply chain solution, provides innovative solutions across channels, expanding into digital business and provide services beyond postal services. It focuses on developing Pos Malaysia's potential and enhances operational capabilities.
Khalid said although digital technologies were among the main challenges for Pos Malaysia as it was changing the way of communication, it would also be a key enabler for the group.
“Technology will take us to the next level. We recognised the important of technology but there are some areas of our business that can never be digitised. Such as flows of goods. We have the advantage of being able to converge physical and digital,” he said.
Khalid said the transformation plan also took into considering of its extensive network throughout the country and capability to deliver to over eight million addresses would be capitalised to offer some solutions to its customers.
Pos Malaysia is also looking at introducing syariah-compliant pawn broking business as it transforms itself to become a one-stop solutions provider.
“We are going to launch this very soon. We have identified the parties to be with us. We are not building any new offices. We are going to use our post offices for this but not all entire branches,” Khalid said, adding that it had also finalised the funding for the setting up of its Islamic pawn-broking business.
Following its transformation plan, Pos Malaysia hopes to achieve double-digit growth in turnover by 2017 and better profit margins than the current 12%.
Separately, Khalid said Pos Malaysia was looking into unlocking its land but no firm plans had been made. He added that it had set up a unit to look into the redevelopment of its lands.
“If we see potential than just a post office, then we will look into redevelopment,” he said, adding that land business was not its core business.
Pos Malaysia would also be looking into setting up six to seven mail smaller mail processing hub following the success of its National Mail and Parcel Hub in Shah Alam which had helped to increase more than 60% of mail automation level.
Khalid said Pos Malaysia is expected to spend about RM150mil annually on capital expenditure on an average for the next five years. It is also maintaining its dividend policy payout ratio of 35%.