Czech Post has negotiated with banks to increase its credit framework from CZK 3.25 billion to CZK 4.75 billion this year. While Česká pošta has secured credit limits for operational financing from ČSOB and UniCredit Bank, Raiffeisenbank and ING Bank have provided financing for the period until the reimbursement of the costs of providing universal service. This compensation is paid by the State to the Czech Post for the public services provided under the postal licence. However, its payment is subject to notification by the European Commission, which takes a number of months. The Post Office said in a press release today.
“Even though we deployed rigorous crisis management last year and expect to reduce Česká pošta’s losses to below CZK 800 million, which is a significant improvement year-on-year, the stabilisation of operational financing for this year was mainly due to the confirmed credit frameworks from leading Czech banks,” said Ondřej Škorpil, director of Česká pošta’s shared services division. Negotiating new loan agreements with banks took several months and involved a careful examination of the company’s financial situation.
This year, the Post Office is undergoing a transformation aimed at long-term stabilisation of its management, separation of commercial and public services and strengthening its role as a contact point between the citizen and the state. A major milestone will be the separation of commercial and public services, scheduled for 1 January 2025. The Czech Post will apply to the Government for funding for transformation activities on the basis of a clear specification of individual activities.
Czech Post has been in an unfavourable financial situation in the past. “The steps that Czech Post has taken so far to improve its performance have convinced us to provide a credit framework for the next period. We have provided the financing on the assumption that the transformation will continue successfully at Česká pošta, including financial support for specific transformation steps by the state. We are therefore closely monitoring the situation in Česká pošta,” said František Ježek, a member of the Board of Directors of Raiffeisenbank.
To improve its revenues, Česká pošta is preparing to expand the range of products and services offered at its branches, for example through cooperation with certain state institutions, and on the cost side it continues to optimise its operating costs and modernise its processes. The State Enterprise is also continuing to sell its unnecessary real estate assets.
