Australia Post has racked up its first full year loss in more than 30 years, posting a $222 million loss after tax for 2014/15.

A press statement on the Australia Post website said:

Australia Post today announced a full-year loss after tax of $222 million ($352 million before tax), driven by the continued decline in letter volumes.

Addressed letter volumes fell by 7.3 per cent, with ordinary stamped letters falling by 10.3 per cent, as Australians continue to switch to digital alternatives, with losses in the mail business growing to $381 million. Group revenue remained stable at $6.37 billion, with parcels revenue up 3.6 per cent to $3.21 billion, for the first time delivering more than half of total revenue.

Despite recording a full financial year loss, Australia Post managing director and Group CEO Ahmed Fahour said the business had now made important headway reforming the letters service.

“As we had forecast, this has been a challenging but crucial year of transition for our business, reflected in the numbers.” Fahour said.

“We are grateful to the government and members of parliament for supporting our reform program as it passed the Senate last week, enabling us to get on with this critical transformation.

“We continue to make headway with reforming our letters business and we are investing in the infrastructure and digital capabilities – vital to servicing the changing needs of our customers.

“We are confident we have the resources, infrastructure and support in place to manage the ongoing transition of our letters business as we become a more eCommerce-centric organisation.”

The parcels business continued to be challenged, despite revenue growing year-on-year, in a highly competitive market where domestic freight providers are building capacity and international competitors acquiring sorting and last-mile delivery capabilities in Australia.

“Despite increasing competition, for the first time ever our parcels business delivered more than half of total revenue. We are well positioned to continue our strong support for Australian business and consumers.”

Ongoing investments in eCommerce delivered this year include:

• Expanded major parcels facilities in Sydney and Melbourne, doubling processing capacity at both sites
• Significant growth across the MyPost product offering, including the Digital Mailbox, with two million subscribers now registered
• $125 million pledged in annualised payments over the past two years, to support the sustainability of our Licensed Post Offices and Community Postal Agencies
• Continued rollout of the 24/7 Parcel Lockers network and the introduction of extended post office trading hours and Saturday deliveries
• Further development on key strategic partnerships with leading Chinese companies to help grow eCommerce trade between the two nations.

The Australia Post Annual Report will be tabled in Federal Parliament later this year.