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Australia Post 2020 Annual Report PROTECT | SERVE | SAFEGUARD 2020 Annual Report Protect Serve Safeguard 1 AUSTRALIA POST ANNUAL REPORT 2020 Table of contents Performance highlights 1 About Australia Post 2 About this report 3 Chair’s message 4 Strategic direction 5 Group Chief Executive Officer and Managing Director’s message 6 Corporate responsibility 8 Network overview 9 Value creation 10 Our business performance 12 Our people 18 Our customers and communities 28 Our network 38 Our innovation and expertise 42 Our environment 46 Addressing our key risks 54 Materiality assessment 2020 57 Our Board 58 Our Executive Team 60 Corporate governance statement 62 Remuneration report 64 Financial and statutory reports 84 Our full Corporate Governance Statement and Australia Post acknowledges the Traditional Corporate Responsibility Index, including Global Custodians of the land on which we operate, Reporting Initiative (GRI) Content Index, are available live and gather as employees, and recognises online at: their continuing connection to land, water and auspost.com.au/about-us/news-media/publications community. We pay respect to Elders past, present and emerging. Front cover: Effie, Docks Operation Support from Melbourne Parcel Facility 2 PROTECT | SERVE | SAFEGUARD Performance highlights Our business Our customers and Our people performance communities • Record revenue of $7.5 billion, • Introduced measures to protect and • Supported 10,802 jobs in regional and up 7 per cent support our people during the challenges remote Australia through our delivery and • Profit before tax of $53.6 million, of bushfires and COVID-19 Post Office network up 30 per cent • Reduced manual handling touchpoints • An increase of 57 per cent in visits to our • Business efficiency savings of by 520,000 per day across six sites digital channels, with 495 million visits PERFORMANCE HIGHLIGHTS HIGHLIGHTS PERFORMANCE $281.1 million • Achieved record attendance and • Facilitated an estimated $2.4 billion • 80 per cent growth in eCommerce productivity through the first COVID-19 eCommerce boom during the height of the during the first eight weeks of the quarter COVID-19 crisis, helping create local jobs COVID-19 pandemic • Invested $20 million in PPE to keep our • 230 million SMS messages sent to • Non-letter revenue was up 15 per people safe customers between April and June 2020, cent, constituting 73 per cent of • Provided security for more than advising them of their parcel’s status. total revenue 33,000 postal employees by signing • Supported fire-ravaged communities with • Delivered approximately 400 million a Memorandum of Understanding free mail redirection, over-the-counter parcels, including 118 million during to protect employee conditions donations in Post Offices and the disaster the last quarter • Used new ways such as SMS and video relief stamp pack to connect with our workforce and keep • Launched our Community Strategy them informed about COVID-19 including partnerships with Beyond • Celebrated our diversity with workplace Blue, the Australian Red Cross and the initiatives, community activities and Indigenous Literacy Foundation online forums Our innovation Our network Our environment and expertise • $316.1 million capital investment • Launched Sending Made Easy, • Achieved our 2020 emissions target to introducing national flat rate retail reduce CO e (Carbon Dioxide equivalent) • Opened the Brisbane Parcel Facility 2 in Redbank, Queensland - the largest pricing for parcels up to 5 kilograms by 25 per cent, equivalent to 100,000 tonnes of CO e since 2010 parcel facility and delivery centre in • Secured new agreement with the 2 the southern hemisphere - and rolled Universal Postal Union • Achieved our 2020 reuse and recycling out automation at six other sites • Supported businesses to work target to divert 100,000 tonnes of material • Made significant adjustments to remotely and adapt to eCommerce from landfill between 2016 and 2020 support communities through during COVID-19 • Introduced ‘best in market’ plastic COVID-19, with 16 pop-up facilities • Launched Workforce Verification, satchels with 80 per cent recycled and up to 17 planes chartered per day providing a streamlined and efficient content, and mailing boxes that are • Partnered with supermarkets and verification solution to employers 100 per cent certified by the Forest Stewardship Council (FSC) pharmacies to deliver essential • Supported small business growth items during COVID-19 through our Local Business Partner • Implemented carbon neutral delivery for all parcel products sent through the Retail • $50 million investment in security program including X-ray equipment, explosive and MyPost business channels, offsetting trace detection units and automated the emissions of 62 million parcel conveyer systems deliveries annually Performance against targets Performance indicator Standard/Target Performance Profit before tax $15.0 million $53.6 million Shareholder return on equity 0.5% 1.9% Dividend declared for 2019/20 $6.1 million $27.9 million Dividend paid in 2019/20 $24.0 million $21.0 million Street posting boxes 10,000 15,036 On-time letter delivery 94.0% 97.1% Retail outlets In total 4,000 4,330 In rural and remote areas 2,500 2,520 In metropolitan areas* 90.0% 93.7% In non-metropolitan (i.e. rural and remote) areas# 85.0% 88.8% Delivery frequency per delivery point at least 5 days per week 98.0% 98.8% no less than 2 days per week 99.7% 99.9% * Residences to be located within 2.5 kms of an outlet # Residences to be located within 7.5 kms of an outlet 1 AUSTRALIA POST ANNUAL REPORT 2020 About Australia Post Hobart North Post Office in Tasmania Today, more than ever, Australia Post is at the heart of Australian communities, connecting them to each other and the world. In a We deliver to year that has been one of the most challenging in Australia Post’s more than 200-year history, as Australia’s leading logistics and 12.3 million integrated services business, our objective has nevertheless delivery points across Australia remained the same: to support our customers to grow and Street address communities to thrive, to create products that people value and trust, and to always deliver great service and value to our But as we continue to transform and innovate our business to customers and the community. meet the changing needs and expectations of our customers, As bushfires swept across our nation and isolated many what we do is much more than just delivering on our community communities, our Post Offices stayed open and acted as a service obligations. vital local hub for Australians, particularly in rural and We continue to meet the growing demand for online shopping, regional Australia. exacerbated this year by the challenges of COVID-19. Our They helped communities stay connected, and at a time when investment in our parcels business in recent years, ensured we cash was crucial, our Bank@Post service helped bushfire- were well placed to tackle the massive spike in parcel volumes affected communities access the essential goods they needed. as people were forced to stay home, and traditional bricks and Then, we moved on to the next challenge - the onset of a global mortar retail was required to adapt online. pandemic - and again, our Posties, our drivers, and our facilities Each year, we make a direct contribution of over $3 billion played an important role, helping deliver the essential items to national GDP through our operations; and the indirect Australians needed. economic impacts that flow from our activities contribute As a Government Business Enterprise (GBE) that operates under almost as much again. the Australian Postal Corporation Act 1989 (APC Act), Australia Our workforce of more than 75,000 people is made up of 35,000 Post is a completely self-funded business with both commercial employees and an extended workforce of contractors, licensees and community service obligations. It requires us to make the and subcontractors. We continue to place the safety of our best use of our assets and resources, enabling us in turn to earn people as our highest priority because we believe everyone profits that can be reinvested in our business for the benefit of should feel safe and well in the course of their day. the Australian community. We are committed to enhancing our reputation and performance Section 27 of the APC Act prescribes our community service as a responsible business, and we are actively pursuing our goal obligations (CSO), which require us to provide an accessible and of reducing our environmental impacts. reliable letters service, at a uniform price, for all Australians, regardless of where they live. 2 PROTECT | SERVE | SAFEGUARD About this report ABOUT AUSTRALIA POST AND ABOUT THIS REPORT We use these symbols throughout the report to signal content relating to the six capitals of the Integrated Reporting Framework. Financial capital Human capital Social capital Manufactured Intellectual Natural capital Our business Our people Our customers capital capital Our environment performance and communities Our network Our innovation and expertise Our annual report provides an overview of our business activities Identifying material issues and our financial, environmental and social performance for the 2019/20 financial year in a single, integrated report. Each year, we undertake a materiality review to identify those topics that have a direct or indirect impact on Australia Post’s The report is prepared in accordance with legislative ability to create, sustain or erode economic, environmental requirements, the Integrated Reporting <IR> framework, the and social value for the enterprise, our stakeholders and Global Reporting Initiative Standards (GRI) Core option and the society at large. 10 principles set out in the UN Global Compact. Our approach to value creation, governance, performance and future outlook The top 10 material issues nominated by our internal and are reported against the six capitals of the <IR> framework – external stakeholders for 2020 were: financial, human, social, manufactured, intellectual and • Employee safety, health and wellbeing natural capitals.
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