Interview with Alex Glanzmann, Head of Finance
“The path is challenging, but our efforts are having an impact.”
Alex Glanzmann, Head of Finance, assesses the 2024 annual results and takes a look back on an eventful strategy period: four years of consistent change in line with customer needs have enabled Swiss Post to stabilize its result. Swiss Post is fit for the future thanks to investments in its core markets and new competencies. The challenges, however, remain.
Alex Glanzmann, how do you see the 2024 annual results?
Given the difficult operating framework, we achieved good results and managed to stabilize Swiss Post’s financial result again after a challenging year in 2024. We generated a Group profit of 324 million francs. That's 70 million francs more than in 2023. We achieved the operating profit that increased to 401 million francs through price and efficiency measures.
We want to remain relevant for Switzerland and finance the universal service obligation from our own resources.
2024 was the last year of the four-year Swiss Post of tomorrow strategy period. Is the strategy working?
Yes, the measures we’ve implemented with the strategy are working. When we developed them in 2019, the Swiss Post system was under a great deal of pressure. Letter volumes and over-the-counter transactions, which, up to then, had both made a major contribution to results, were in serious decline and the interest rate environment was difficult. These trends remain to this day. If we hadn't made changes, our results would have continued to fall. With the Swiss Post of tomorrow strategy, we’ve fundamentally realigned Swiss Post with the goal of financing our universal service obligation from our own resources in the future.
What are the main drivers behind the improved result?
For 2024, the main driver is the Logistics Services unit. Thanks to more efficient processes and the price adjustments implemented, we more than offset the continuing decline in demand in the letter and parcel business.
But as I said, if we are to remain relevant, we need to undergo a holistic transformation. In the past four years, we’ve invested heavily in our core business to adapt to changing customer needs. In logistics, for example, we’ve increased our storage and processing capacities and further electrified our vehicle fleet. Thanks to targeted acquisitions of companies in healthcare and construction logistics, we’ve gained key expertise. We’ve built up new infrastructure and competencies in digital communication. We’ve continued to develop our branch network and opened our locations up to service providers and public authorities. And, at the same time, we’ve worked intensively on our internal structures and processes throughout the Group.
We need to gear our products and services consistently towards customers’ needs.
The market environment remains challenging. How do you assess the results in this context?
Our society has changed profoundly in recent years. Digitization, the dynamic nature of customer requirements and the geopolitical situation have all had a direct impact on our business. The decline in the volume of letters and payment transactions is irreversible. In 2024, we processed 5.5 percent fewer letters and the number of over-the-counter payments fell by 10.7 percent. In 2024, after two years of declining parcel volumes, we again processed more parcels in the run-up to Christmas, but over the year as a whole, these volumes continued to fall. Falling interest income and increasing pressure on margins are also weighing on PostFinance’s result. The structural decline in volumes and the volatile interest rate environment, particularly influenced by the SNB’s interest rate decisions, continue to be a challenge for Swiss Post.
Is Swiss Post ready for the new strategy period?
Yes, Swiss Post is in good shape. Our logistics are now efficient and we offer trust-based digital services. But we’re not standing still. Given the challenging conditions, it’s even more important for us to continually evolve and adapt to the changing environment. We need to gear our products and services consistently towards customers’ needs, while also keeping a close eye on our costs. This is the only way that we can both remain relevant for Switzerland and provide a self-financed public service.