By Caitlan Reeg
Deutsche Post AG (DPW.XE) said Friday that it has asked federal
regulators for permission to raise postal rates from next year, as
the company tries to offset declining mail volumes and higher labor
costs.
The German mailing and logistics group wants to raise the price
of stamps for regularly sized domestic letters, to EUR00.60 ($0.81)
from EUR00.58, in addition to increasing fees for select mail
forwarding services, packages and international mail.
Germany's Federal Network Agency, which also oversees industry
pricing for electricity, gas, rail, and telecommunications, sets
postage prices using a cap based on inflation and productivity
rates.
Analyst Dirk Schlamp from DZ Bank estimates the higher fees
could increase Deutsche Post's earnings by roughly EUR50 million
annually.
In tandem, Deutsche Post has proposed lowering fees on some
international packages, orienting package prices more closely to
standard retail practices--for example, a package abroad weighing
up to 5 kilograms would cost EUR14.99, rather than a round
EUR15.00.
German postal price increases are a recent development. For over
a decade, the price of a standard letter didn't budge, remaining at
EUR0.55. But in 2012, the network agency approved Deutsche Post's
request to increase the fee by 5%, to EUR00.58.
The company said it expects the network agency will issue a
decision on the request within two weeks.
Consumer groups have yet to comment on the proposed
increases.
Tuesday, Deutsche Post confirmed its outlook of higher sales and
earnings this year, despite third-quarter figures coming in under
analysts' expectations. Third-quarter net profit rose 5.8% from the
year-earlier quarter to EUR399 million, just below analysts'
forecasts of EUR411 million. Revenue during the quarter fell,
primarily due to currency effects, to EUR13.5 billion.
Following the earnings release, DZ bank's Mr. Schlamp said
Deutsche Post is well positioned with "attractive" long-term growth
prospects.
(Kirsten Bienk in Hamburg contributed to this item)
Write to Caitlan Reeg at caitlan.reeg@dowjones.com
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