My first year of duty as Postmaster General was filled with exciting and enlightening episodes. Advancement in electronic communication technologies and advent of social media software are threatening the viability of postal administrations worldwide. But despite the looming threat that e-substitution is imposing on traditional letter mail, rising penetration rate of the Internet is inculcating a set of emerging consumption habits and social behaviour that could open up new opportunities.
Against this backdrop, mail traffic registered an overall decrease of 5.6% as compared with 2008/09, weighted down by domestic mail which fell by 7.7% but offset in part by a comparable rise for international mail. Revenue for the year rose by 4.3% to HK$4,752 million, yielding a profit of HK$234 million and a return rate of 6.6% on average net fixed assets. This operating result highlights two fundamental issues – first, a pressing need to address the deteriorating profitability of domestic mail caused by erosion of traffic volume as well as our obligation to provide a reliable and affordable postal service; second, the importance of maintaining a tight grip on the cost structure of international mail which is heavily influenced by air freight rates and terminal dues.
As a public entity whose existence dates back to 1841, Hongkong Post is blessed with a service culture and corporate identity that enabled it to secure public trust and prevail through numerous adversities. Furthermore, it possesses an unmatched capability to meet stringent performance standard of delivery to each of the some 2.9 million addresses in Hong Kong. We must leverage on these attributes to alleviate the slowdown of domestic mail traffic. Some initial success has already been achieved in terms of order fulfillment for small consumer products and electronic goods as well as mail collection cum inter-branch document exchange service for corporate clients. In the coming year, we will focus on how to harness synergy between our inimitable delivery platform and a vast network of 127 retail outlets.
Gifted with an ideal geographical location and served by one of the most efficient air cargo hub in the world, Hong Kong has become a confluence of e-commerce activities. We will take full advantage of this development by strengthening our sorting and processing infrastructure to cope with demands during the peak period of outbound airmail traffic. We will forge closer partnership with major postal administrations to widen the choice of products for our clients. Needless to say, we should lose no vigilance in procuring adequate air conveyance capacity and pursuing bilateral agreements to manage terminal dues payment.
Faced with a volatile economic environment, Hongkong Post must also extend its footprint into activities complementary with or ancillary to postal services. Noticing that the widespread adoption of e-statements might increase the tendency for companies to outsource printing and enveloping work, we have reached out to the banking and insurance sectors with our hybrid mail service as a business facilitation tool. The impetus to modify our marketing strategy for stamp and philatelic products will sustain with a view to attracting interest from the younger generation, while efforts will be made to expand the variety of products available on ShopThruPost and to enhance its appeal as an online shopping portal. On direct marketing, we will monitor the impact brought about by launching of the opt-out sticker scheme and introduce value-added features for small and medium enterprises to make use of the Hongkong Post Circular Service.
Although the past year was fraught with arduous challenges, we managed to acquire sharper sensitivity towards market gyrations and customer sentiments. I wish to thank my management team for their unwavering support and unreserved advice. My gratitude also goes to frontline colleagues whose resilience and dedication have played a crucial part in enabling us to roll out innovative ideas and new ventures. Last but not least, I would like to thank our customers and business partners for their loyalty and understanding.
Clement CHEUNG
Postmaster General and
General Manager of the Post Office Trading Fund
Please click here to download The Postmaster General's Statement [PDF, 2 pages of 396KB]