Statement by Directors, Group Chief Executive Officer and Managing Director and Group Chief Financial Officer

2018/19 Financial Statements

In our opinion:
(a) the accompanying financial statements for the year ended 30 June 2019:

(i) present fairly the entity’s financial position, financial performance and cash flows;

(ii) comply with the accounting standards and any other requirements prescribed by the Public Governance, Performance and Accountability Act 2013 and the Public Governance, Performance and Accountability (Financial Reporting) Rule 2015; and

(iii) have been prepared based on properly maintained financial records.

(b) at the date of this report, there are reasonable grounds to believe that the group will be able to pay its debts as and when they fall due.

This statement is made in accordance with a resolution of the directors.

Australia Post Group
2018/19 Financial Statements Certification by Directors

Prior to the adoption of the 2018/19 financial statements, the board received and considered a written statement from the Group Chief Executive Officer and Managing Director and Group Chief Financial Officer that in their opinion:

• the financial records of the corporation and the consolidated entity have been properly maintained;
• the statements comply with the accounting standards and any other requirements prescribed by the Public Governance, Performance and Accountability Act 2013 and the Public Governance, Performance and Accountability (Financial Reporting) Rule 2015 and present fairly the entity’s financial position, financial performance and cash flows; and
• integrity of the financial statements is founded on a sound system of risk management and internal control which is operating effectively.

John Stanhope AM
Chairman
Melbourne
21 August 2019

Annual performance statement

Each year, Australia Post provides a rolling four year corporate plan. The 2018/19 corporate plan and associated Statement of Corporate Intent were submitted to shareholder ministers in August 2019 detailing Australia Post’s strategic direction.

Statement

The directors, as the accountable authority of Australia Post, present the 30 June 2019 performance statements of the Australian Postal Corporation and its controlled entities, as required under paragraph 39(1)(1) of the Public Governance, Performance and Accountability Act 2013 and other applicable legislation.

In the opinion of the directors, the annual performance statement is based on properly maintained records, accurately reflects the performance of the entity, and complies with subsection 39(2) of the Public Governance, Performance and Accountability Act 2013.

Purpose

Australia Post’s purpose is expressed through the Australian Postal Corporation Act 1989 (APC Act) that sets both community service and commercial objectives.

The principal function of Australia Post as per the APC Act is to supply postal services within Australia and between Australia and places outside Australia. While doing this, we will provide high-quality, efficient services to the community, and operate commercially and achieve a reasonable return on assets.

More specifically, we are required to meet our community service obligations by ensuring that the regulated letters service:

• is reasonably accessible to all Australians on an equitable basis;
• operates to performance standards that meet the needs of the community; and
• is provided at a uniform price for standard letters carried by ordinary post within Australia.

In an environment where non-letter products are an ever- increasing part of our network, Australia Post operates to a more expansive purpose that is aligned to the full range of services that our customers value.

We deliver letters and parcels to all Australians. We deliver incoming international letters and parcels, and offer outbound international services. We offer an extensive range of letter and parcel services, to a choice of delivery standards.

We provide financial services through a network of more than 4,000 post offices, including over 2,500 in rural and remote Australia. While many of the services offered in post offices are subject to digital substitution, in-person services remain highly valued by the Australian community. In addition, we offer a range of digital payment solutions for businesses and consumers.

We connect people with each other and the world. We help unlock opportunities for everyone. Everyone Matters.

People are at the heart of everything we do. And providing access to the services and support that they need is what drives us.

• we will support communities to thrive;
• we will support customers to grow;
• we will connect customers in a dynamic global market;
• we will create products that people love and trust; and
• we will always provide great service and value.

Results

Key community service objectives as set out in the plan for 2018/19 which align to the APC Act and prescribed performance standards and performance against these were as follows:

Key commercial objectives as set out in the plan for 2018/19 and performance against these were as follows:

Analysis

This was another year of significant achievement amidst ongoing change for Australia Post, as we delivered on our dual objectives of providing an accessible, reliable nationwide community service, while achieving a commercial rate of return for our shareholder.

Just like postal businesses around the world, the digital disruption of our traditional core business (particularly the declining use of letters) remains our primary challenge.

We have consistently pursued our One Australia Post strategy to position customers at the centre of all that we do, and in doing so, have realised many notable achievements:

• maintaining a purpose of connection with Australian communities by providing services that all Australians value;
• refreshing our Bank@Post agreement, securing ongoing access to essential banking services for all Australians;
• providing Australians with access to our services via the Australia Post Mobile application which is one of the highest rated mobile apps (4.8/5) on Apple’s app store;
• completing the reset of our payments to Licensed Post Offices; the first significant transition in over 20 years, and largely enabled by our refreshed Bank@Post agreements. The reset has resulted in a sustainable payments model that reflects fair returns for a contemporary range of post office services;
• prioritising the safety of our people through an initial rollout of electronic delivery vehicles that will accommodate greater parcel volumes. The safety and wellbeing of our people will continue to be our first business priority as we pursue a goal of zero fatalities;
• improving the customer service experience for consumers, evidenced through a reduction in complaints directed to the Postal Industry Ombudsman. We are now utilising teams to target the most salient and frequent issues and complaints as soon as they happen. This has resulted in marked improvements in complaint resolution times;
• introducing an improved go-to-market model and enhanced customer coverage for business customers;
• managing the decline of our letters business – addressed letter volumes declined 9.0 per cent. A successful trial of a tracked letter product has effectively promoted the value of mail to customers seeking a tracked service;
• growing parcels profitably. We delivered over 40 million parcels in December 2018, including 10 days in December of over 2 million. Ongoing investments in capacity and capability, including our new processing centre in Redbank, Queensland, will position us to continue capturing the eCommerce opportunity; and
• positioning ourselves to grow our International business through the full acquisition of Aramex Global Solutions (renamed to Australia Post Global). This will enable Australia Post to accelerate its expansion into the global eCommerce business.

This statement is made in accordance with a resolution of the directors.

John Stanhope AM
Chairman

21 August 2019

Financial statement audit report