New Zealand Post Group, which plans to eliminate up 2,000 jobs in the next three years and reduce deliveries to just three days a week, says first-half profit has risen 18 per cent as it slashes costs faster than revenue declines.
Profit was $NZ71 million ($A66.09 million) in the six months ended December 31, from $NZ60m a year earlier, the state-owned postal service said on Monday.
Sales fell to $NZ860m from $NZ872m, while operating costs dropped four per cent to $NZ761m, or declines of $NZ12m and $NZ32m, respectively.
NZ Post expects its full-year result to be "close to plan," chief executive Brian Roche said.
"We will balance ongoing cost reduction with a strong focus on growing new and profitable revenue and developing new ways to serve customers and meet their changing needs."
The company is grappling with the continued slide in the volume of letters posted as consumers switch to the internet, email and social media for everything from paying bills to sending birthday greetings and keeping in touch with loved ones. It estimates letter volumes have tumbled 30 per cent since 2006.
In the same period, parcel volumes have increased and today Roche said growing its parcels and logistics business "is a top priority".
NZ Post is preparing to reduce delivery of standard mail to urban households to alternate days in mid-2015 and is trialling different modes of delivery over the next six months, it said.
In November, the company said it aims to eliminate between 1,500 and 2,000 jobs in a three-year shake-up, by reducing deliveries, closing Post Shops and trimming costs.
"New Zealand Post will continue to reduce its property footprint, including owning fewer corporate Post Shops in its network of 880 service points, with more services being hosted by local businesses," Roche said.
The company will pay a $NZ2.5m interim dividend to the government, unchanged from a year earlier.
