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Download Pdf Nz Post Integrated Report 2016 NZ Post Integrated Report 2016 Delivering on NZ Post Integrated Report 2016 Year at a glance CEO and Chairman About NZ Post Our strategy Our reporting Our governance Message and performance and approach The sale of Converga for Building underway on a 2016 AUD new parcel facility Year at a glance $75m generated a gain of in Christchurch Completion of a NZD Inbound international parcel volumes including new $43m state-of-the-art freeing up capital funds sorting machines supplied facility for investment by Daifuku BCS grew by for courier nearly million letters We achieved and postal operations processed 15.5% for the two postal 76% in Te Rapa flag referendums diversion of waste the Waikato Operations Centre from landfill Choice of the Introduced a new range of Paxster parcel delivery as NZ Post’s new electric delivery vehicle, with 500 to be used for the options giving customers combined delivery more choice about where and when they receive their parcels of parcels and mail in larger towns and cities Nearing In 2015/16 we processed We partnered with the A¯kina Foundation 578m & 65.1m 200,000 items of mail, parcels regional social registered YouShop customers (a drop of 7.7% since 2014/15) (up from 61.2 million the year enterprise hubs 194,000 before, an increase of 6.4%) as at 30 June New Zealand Post is... Delivering on our customers’ our customers’ expectations aspirations 6what counts our strategy7 CONTENTS 01 Year at a glance 01 09 CEO and Chairman’s message Year at a glance 13 About NZ Post 14 Who we are & What we do 16 Our purpose, strategy and values 19 Our strategy and performance 20 Grow 26 Innovate and serve 34 Lower cost 09 39 Our reporting and approach CEO and Chairman’s message 40 Our capitals 42 Our material matters 44 Our business model 47 Our governance 48 Board of directors Delivering on our trusted performance 52 NZ Post Group leadership team Foreword 13 CEO and Chairman’s message About NZ Post As we pass the half-way mark of our advances to $11 million. The bank’s year-end five-year transformation plan the results are set out in our Group Annual Report New Zealand Post Group is in a much that has been published alongside this document. stronger position to withstand and This remainder of this report focuses on the respond positively to the challenges postal services side of the business. faced by our parcels, mail and 19 logistics (postal) and financial services The postal services business made an operating Our strategy and performance (Kiwibank) businesses. loss after tax of $11 million reflecting the ongoing fall in revenue from lower mail volumes. The loss The ongoing effects of digital disruption and would have been greater had it not been for further competition in both markets prompted a reset cost reductions and a 2.9% growth in parcel in our strategic thinking in late 2013 and has led revenue. Parcel volumes grew by 6.4% overall to a range of responses since then. The Group is and international inbound volumes by 15.5%. addressing two unique strategic imperatives: the While margin growth remains difficult in structural decline of our core letters business and challenging market conditions, the parcel trends the opportunity to take Kiwibank to the next stage are pleasing and we are actively pursuing market 39 in its development. opportunities to further grow our parcels business. Our reporting and approach Kiwibank continued to perform well in 2016 and We made good progress during FY 2016 in posted an after tax profit of $130 million, down continuing to implement the large scale slightly on the year before. It grew lending and operational, organisational and asset portfolio advances to customers by 7.0% from $15.6 billion changes we identified at the outset of the to $16.7 billion, and customer deposits by 7.6% transformation plan as necessary parts of our from $13.7 billion to $14.8 billion. It also saw a journey to becoming a profitable modern 47 15% reduction in impairment losses on loans and services business. Our governance 9 NZ Post Integrated Report 2016 Year at a glance CEO and Chairman About NZ Post Our strategy Our reporting Our governance Message and performance and approach From a portfolio perspective, our strategy of As we modernise and increase the services we Times have changed and we must devolve selling non-core assets to free up cash for deliver for our customers, we are also making more accountability and decision-making to investment in our mail and parcels business fundamental changes to both our organisational the front line by giving customer-facing leaders took another significant step with the sale of and operating models. These changes, which we in operations and sales a strong mandate Converga. At the time of writing, the process to began last year, are perhaps the hardest part of and more focused support and tools to build introduce new Crown shareholders in Kiwibank our transformation. We are significantly reducing strong, mutually beneficial relationships with was progressing well and nearing completion. our headcount, resulting in a number of people our customers. It also means we need to shift The arrangement will allow New Zealand Post to leaving the business, and the changes depend on our deeply ingrained habits and beliefs so that repay debt acquired to grow Kiwibank and provide successfully embedding a completely new way we are able to move our story on from being new sources of capital and investment expertise of working. about a declining letters business to a growing for Kiwibank. It also allows New Zealand Post to parcels business that embraces the future and focus on its core packages and parcels business. To be a truly modern services business, we need can respond quickly and confidently to changing This is New Zealand Post’s fourth report applying to instinctively look outwards so that everything customer needs. We have received the first shipment of the 500 we do has the customer in mind. While sounding the International Integrated Reporting Council Paxster electric vehicles that will be used to obvious, it is a different way of operating from We are making good progress towards meeting (IIRC) Integrated Reporting Framework. We were deliver parcels as well as letters to residential the historically more structured and hierarchical these aims. Ultimately, in a highly competitive a participant in the IIRC pilot programme and areas in New Zealand. They are already in New Zealand Post model that has served New marketplace we want to be distinguishable from produced New Zealand’s first integrated report operation in parts of the North Shore, New Zealand’s communities and businesses well for the competition with a reputation for going the in 2013. Plymouth and Oamaru. A brand new integrated 176 years and made us one of this country’s most extra mile for our customers and for being the This year we have made a significant change in parcels and mail hub began operations just recognised and trusted brands. best place to work. focusing our integrated report on the Post part outside Hamilton in July, and building got of the business. By not including Kiwibank/ underway on a purpose-built parcels processing Our focus must necessarily be on maintaining financial services in this report, we aim to and distribution centre at Christchurch Airport. and enhancing shareholder value. That has many remove some of the complexity and provide Another highlight was the introduction of three challenges in our current operating environment greater clarity regarding the Post business Boeing 737-400 freight aircraft into a shared air but it also one with several opportunities available model. To meet our statutory obligations as a network providing services for New Zealand Post, as we reposition our business to one focused on Group, we have produced a separate annual which will carry more parcels, faster and at packages and parcels. Similarly, the financial report covering all parts of the New Zealand less cost. services business, with the introduction of new owners and availability of capital, will now be able Post Group. For our processing operations, we selected new to more actively pursue market opportunities. In summary, we are here to create value for our machines for the Christchurch site that will sort stakeholders, across our six capitals, via our parcels four times faster and more reliably than Both businesses are focussed on continuing to strategy to address our material issues. In an they are now. In addition, we have chosen new transform themselves into much more digitally effort to improve the connectivity of information technology to improve the speed, accuracy and led businesses and, in doing so, improve the contained in the report we have increased the service levels of the letter sorting machines at customer experience and quality of their use of icons and colour-coding (see the glossary our mail processing centres. respective services to the market. on the back cover flap for details), to show how We are continuing to fund new infrastructure and everything is interlinked. technology, and develop new and improved online, At the start of each of the three performance mobile and delivery services for our large sending, chapters, namely Grow, Innovate and Serve, and and receiving customers. We introduced the first Lower Cost the relevant material issues, capitals of several new parcel collection and delivery and stakeholders are identified. The six capitals services into the market to give our customers provide a holistic view of the range of resources more options to ensure they can receive parcels we rely on to run our business and deliver value.
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