KUALA LUMPUR (Aug 16): Pos Malaysia Bhd sank deeper into the red as it suffered lower business volume across the board, including its courier services, as a result of Movement Control Order (MCO).

The postal group reported a net loss of RM121.84 million in the second quarter ended June 30, 2021 (2QFY21) compared with the RM19.02 million net loss posted in the same period a year ago, dragged mainly by lower revenue and impairment of property, plant and equipment.

Loss per share ballooned to 15.57 sen per share in 2QFY21, from 2.43 loss per share in 2QFY20, its filing with Bursa Malaysia showed.

Quarterly revenue fell nearly 12% to RM533.89 million from RM606.08 million a year ago.

On a quarter-on-quarter basis, its net loss also swelled from RM46.78 million in 1QFY21. Revenue shrank 10.3% from RM595.28 million the preceding quarter.

For the cumulative six-month period ended June 30, 2021 (6MFY21), its net loss widened to RM168.63 million from RM68.24 million in the previous corresponding period. Its revenue, however, declined marginally by 3% to RM1.13 billion from RM1.16 billion a year earlier.

Pos Malaysia said it continued to face challenges in 2QFY21 due to MCO 3.0 and the nationwide restriction continued to pressure its postal segment with a 20% decline in mail business as a result of multiple operational limitations arising from stricter standard operating procedures for bulk mailers and financial institutions.

"We foresee that the migration to digital alternatives and continuation of movement restrictions will continue to depress mail volumes further," it added.

For courier business, the group registered a 17% decline in volume as closure of physical outlets by its contract customers during the MCO period contributed to this decline.

Its retail business continued to experience minimal activities due to nationwide movement restrictions and shorter operating business hours, which compelled customers to switch to online platforms, while its international business had yet to normalise due to suspension of services for international mail and parcels.

In mitigating these challenges, amongst others, Pos Malaysia has introduced courier price revision for key customers to improve profitability.

"As part of the mail rationalisation initiative, four more mail processing centres (MPCs) are expected to be rationalised in the third quarter and fourth quarter of this financial year.

"Furthermore, we are revisiting our outsourcing models for Pos Rider (PR) and land transportation in order to manage costs better. Pos Aviation continues to manage its operational costs to minimise losses," it added.

Nonetheless, the group remains cautious about the challenging operational performance for the current financial year ending Dec 31, 2021 (FY21), whilst continuing to take appropriate steps to ensure that the near-term prospects remain stable.

Shares of Pos Malaysia closed up 0.5 sen to 81 sen, giving it a market value of RM634 million. The stock has fallen 30% year-to-date from RM1.16.