By Caitlan Reeg
Federal regulators Monday approved Deutsche Post AG's (DPW.XE)
request to raise postal rates next year, as the company tries to
offset declining mail volumes and higher labor costs.
The German mailing and logistics group will raise the price of
stamps for regularly sized domestic letters, to EUR00.60 ($0.82)
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,
calculates postage prices using a cap based on inflation and
productivity rates.
Analyst Dirk Schlamp from DZ Bank estimated the higher fees
could increase Deutsche Post's earnings by roughly EUR50 million
annually.
Deutsche Post also plans to lower fees on some international
packages and bring them into line with standard retail practices.
For example, a package from abroad and 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 remained at EUR0.55, but
in 2012 the network agency approved Deutsche Post's request to
increase the fee by 5%, to EUR00.58.
In mid-November, Deutsche Post confirmed its sales and earnings
outlook 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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