10 May 2013

Kenya: Posta Projects Sh3.5 Billion Full Year Revenue

STATE-OWNED Postal Corporation of Kenya expects to rake in Sh3.5 billion revenue by end of financial year ending June 2013 a 9.4 per cent increase from last year's turnover.

Postmaster general Enock Kinara said that while agency business has helped supplement income for Posta, the bulk of the revenue collected was due to its core business of mail and courier.

According to Communications Commission of Kenya statistics for quarter one and two of the current financial year, locally sent leters increased by 15.9 per cent during the first quarter to 17.7 million compared to 16.7 million sent between April and January 2012.

In quarter two, international outgoing letters boosted the business by rising 18.1 per cent to a total of 1.9 million from 1.6 million sent during quarter one of year 2012/2013.

This countered the drop in local letters sent during the second quarter which stood at 17.3 million compared to 17.7 million letters and parcels sent during quarter one translating to a slight drop of 2 per cent.

PCK is developing a three year business plan that targets to grow revenue to Sh5 billion through improving its agency business via a $1 million (Sh84 million) financial transactions IT system.

The system will enable the corporation conduct electronic payments for utility bills on behalf of various service providers, agency banking functions, mobile money transfer and card based transactions.

Kinara said that though the corporation did not report any profits for the last financial year ending June 2012, it expects profit as at end June 2013 due to growth in business.

"As a universal communications services provider, 70 per cent of our network is not viable but we are still operating them," said Kinara explaining the lack of profit last year. Agency business operations that PCK conducts are expected to rake in Sh350 million by end June, added Kinara.

He was speaking during the flagoff of a new fleet of vehicles and motorbikes by the corporation that have been purchased to meet demand for mail and courier services which are still the cash cow of the business according to Kinara. This is despite the advent of technology like use of social media and email that has reduced the need to send physical letters.

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