An Post pension liabilities rocket

PENSION liabilities at An Post rocketed to €582.3 million at the end of 2008, up from €114.3m a year earlier, the company’s annual report reveals.

And pre-tax profits at An Post have plummeted by more than €10m to €39.89m in 2008 from €49.417m in 2007, the fifth

consecutive profitable year for the State-owned postal system.

The annual report shows that the company’s defined pension schemes have current assets of €1.448 billion and obligations of €2.03bn and the pension funds made a loss of €486.57m in 2008.

The annual report states: “Since January 1, 2008 there has been a decline in the market value of the scheme assets. Discussions amongst all of the interested parties have commenced with a view to establishing a considered plan to address the deficit.”

The press release issued by the company in conjunction with the release of the annual report makes no mention of the pension deficit or the fall in pre-tax profits but instead reported that An Post made a record operating profit of €31.2m for 2008, amounting to 3.7% of turnover.

The report also shows that chief executive officer Donal Connell’s annual pay package fell by €61,000 to €493,000, down from €523,000 in 2007 as he did not receive any “non-pensionable performance-related pay” in 2008. He received €61,000 under this category in 2007.

Sales fell to €850m, down €26m (2.9%), reflecting a 2% drop in mail volumes over the previous year.

Commenting on the 2008 performance after the company’s Annual General Meeting at the GPO, An Post Chairman John Fitzgerald said that 2008 is a year on which everyone in An Post can reflect with some pride.

“A most acceptable operating profit was achieved on the back of tight cost control in every aspect of the business. This prudent approach must continue as we are now in a radically different economic environment, and there is only one certainty for An Post – that is the imperative to continue to transform the business into an entity that can remain viable in a competitive market,” he said.

The company noted that the price of the basic stamp at 55c since March 2007.

Speaking at the GPO, Donal Connell, An Post Chief Executive said “This financial performance means that we look to the future from a solid base of consistent improvements in virtually every aspect of our business. The unprecedented economic downturn, and its potential to affect our ongoing profitability, brings new and very serious challenges for everyone and a renewed cost focus, he said.

“I am confident that An Post can meet the current challenges as a strong and leading player at the centre of the Irish economy,” he concluded.