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Pos Malaysia banking on AEC to lift courier segment [New Straits Time (Malaysia)](New Straits Time (Malaysia) Via Acquire Media NewsEdge) KUALA LUMPUR: POS Malaysia Bhd expects courier service segment to register double-digit growth on the back of the implementation of the Asean Economic Community (AEC) at end of next year, which will see the removal of tax barriers between the 10-member group. The group's courier service will benefit from the dynamic collaborations with postal carriers across the region through AEC, said group chief executive Datuk Iskandar Mizal Mahmood. "Malaysia's total courier market stands at RM3 billion, slightly higher than the other Asean countries, with a collective value of RM15 billion. "The value of the market in Malaysia is relatively high because it leads Asean countries in terms of Internet penetration which translates into a vibrant e-commerce community. A vibrant e- commerce community calls for parcel delivery and that's where Pos Malaysia comes in. "Thus, the opportunity to tap into the courier segment is huge," he told Business Times on the sidelines of KL Converge 2014, here, yesterday. Iskandar said Pos Malaysia is already actively collaborating with regional postal players from the Asean region to establish itself as a worthy regional player. Meanwhile an analyst told Business Times that though things look rosy for Pos Malaysia in the Asean region it will still have to face high transportation costs, mostly due to higher fuel prices. Pos Malaysia's bottom line will be hampered by two things, high transportation costs and cost of staff retention. "We will see a growth in courier service. But the revenue will not be as significant as what the firm has projected because of high transport costs," said the analyst. The postal service provider's biggest revenue generator is its mailing segment which contributed 57.1 per cent, or RM724.5 million, to its total revenue of RM1.43 billion for the financial year ended March 31 2014, the highest it has recorded to date. Its courier business comes second at 25.4 per cent, or RM322.7 million, of total contribution. However, for the first quarter ended June 30 2014, the firm registered an eight per cent decrease year-on-year (YoY) in lower prepaid, registered mail and ordinary mail volumes while its courier segment reflected commendable operating profit growth of 21 per cent YoY to RM20.3 million which was largely supported by sustained growth in demand for prepaid box and envelopes and on-demand and contract customers. Pos Malaysia recently announced that it has set aside over RM150 million in capital expenditure for its financial year ending March 31 2015 to further improve its services, which includes the introduction of 24-hour parcel lockers. Other initiatives include the upgrading of its offices and information and communications technology infrastructure and the purchase of motor vehicles. (c) 2014 ProQuest Information and Learning Company; All Rights Reserved. |