E-commerce growth brought profit for Omniva in 1st quarter

The group’s business revenue was 29.8 million euros in three months and business profit was 208,000 euros. The result was affected by the planned cost cuts in the first quarter of 2020 and the e-commerce revenue that grew significantly due to the crisis.
 
According to chairman of the management board Ansi Arumeel, the first quarter of 2020 was extraordinarily influenced by the state of emergency declared in Estonia to combat the coronavirus and the resulting restrictions. “Due to the state of emergency the revenues related with direct mail declined while ordering from e-commerce gained speed, as well as using parcel machines as a contactless channel located outdoors,” Arumeel explained.
 
The group earned 208,000 euros of business profit in three months (280,000 euros of loss in the 1^st quarter of 2019), which exceeded the forecast results. Compared to the same three months of last year, the profitability of the company’s logistics business improved.
 
Estonian parcel volumes increased by 34% compared to the same period last year. Due to international commerce stopping, as well as the decrease in orders, the volumes of incoming shipments decreased. At the same time, the volume of e-commerce parcels within Estonia was boosted.
 
Profitability in the postal business with falling volumes declined the most due to the frontline workers’ pay raise in the 2^nd half of 2019. Postal business results were also influenced by the decrease in direct mail volumes in the first quarter.
 
In the first quarter the revenues of all the subsidiaries related with e-commerce also grew considerably. Parcel volumes in the Omniva Lithuanian unit doubled compared to first quarter of 2019, in Latvia these grew by nearly a third. The revenues of AS Maksekeskus, which provides convenient payment solutions to e-commerce companies, also doubled.
 
A major increase in costs was visible in logistics business personnel costs. IT and asset costs (incl. depreciation costs) have also increased. Outgoing international shipment costs decreased considerably due to the influence of declining international business service revenue.