Lombard Bank to increase shareholding in Maltapost

Lombard Bank has announced it increase its shareholding in MaltaPost plc, through its subsidiary company Redbox Limited, from the present holding of 67.72% to not more than 74.5%.

MaltaPost's interim results for the six months ended 31 March 2012, registered €11 million in revenue - a 3.1% increase over the same period in 2011 - on the back of increased cross-border traffic and non-postal revenue. The company has been faced with a considerable increase in direct mail costs due to changes in tariffs regulated by the Universal Postal Union, impacting revenue streams.

Maltapost also registered a 2.3% increase in its wage bill to €5.3 million, as well as a 33% increase in depreciation to €580,000 following the acquisition of the company's head office in Marsa and other 'strategically located properties'.

Profit registered was €796,000, which was significantly lower than the €1.69 million reported in respect of the six months ended 31 March 2011.

MaltaPost plc will be retaining their monopoly despite an impending liberalisation of the market in January 2013, as required by EU legislation.

The Malta Communications Authority intends to renew MaltaPost's designation as the company responsible for the daily collection and delivery of postal items, which is enshrined in its Universal Service Obligations, without issuing an international tender.

The assignment of universal service obligations (USOs), unlike that of other postal services, is carried out by legal notice on the basis of advice by the MCA, and this will remain the case up until the market is fully liberalised in January 2013.

While everyone will be able to apply for a license to carry out postal services on an equal footing, MaltaPost is set to retain its "obligation" to carry out the daily collection and delivery of postal items. This is because the MCA believes that at this stage nobody else is able to carry out the obligations presently carried out by MaltaPost.

This could change in the future when other operators become more established in Malta.

"Over time, as the sector picks up, there may be alternatives and at that point one can consider the feasibility of assigning the USO, or parts of it, to alternative operators," the MCA said, adding that it will periodically carry out an assessment through which it will "question the need for the assignment of the USO on a postal operator in the process, if market forces are seen to be satisfactorily addressing a particular public need."