Courier and logistics business proves robust at 83 percent of growth
Even though they experienced challenges in their amalgamation process with Botswana Couriers and Logistics, Botswana Post registered a profit before tax of P 6.2 million, representing a revenue growth of 16.5 percent year-on-year.
According to the company’s Chief Finance Officer (CFO), Ofentse Mabote, of the 16.5 percent increase (P292 million), 83 percent was due to the revenue from the courier and logistics business. “Growth from business before inclusion of courier and logistics was 2.8 percent. This moderate growth was largely driven by non-traditional revenue lines which grew by 10 percent while the traditional revenue lines shrank by 7 percent,” Mabote stated in the company’s annual financial report.
Botswana Post’s balance sheet also rocketed up by 2.9 percent with a growth in assets to P576.1 million. “We have a challenge when it comes to solvency and liquidity, something that means that our balance sheet is very weak and it also means that cash flow is coming from a very poor ground. I have however noted that we are continuously growing this balance sheet with a maximum of 3 percent, so one would imagine what would happen if we were to sort out the structure of that balance sheet,” Botswana Post said when briefing members of the media during the presentation of the company’s financial results recently.
The company did not do well in managing its controllable costs as they increased by 33.7 percent with operating costs totalling P157.3 million. Botswana Post had registered a reduction of 6.8 percent in controllable costs in the previous financial year. However, in explaining the drastic increase, the CEO of Botswana Post Cornelius Ramatlhakwane referred to amalgamation. “When you amalgamate, there are a lot of things that you have to do; things like aligning the pay structures of the combined entities to be the same,” he said.
Botswana Post paid its staff members P96.7 million in salaries in the current financial year as compared to P64.5 million in the previous financial year. The amalgamation, on the other hand, cost Botswana Post around P63 million.
Ramatlhakwane said cost reduction of cost reduction would remain a focus at Botswana Post. “Costs are the devil that if you don’t manage, the company becomes a poor performer. Costs are things that we are able to control because they are behavioural and I am happy the company realises the importance of dealing with costs,” he said.