Australia Post chief Ahmed Fahour’s $2m cheque is in the mail
AUSTRALIA Post chief Ahmed Fahour will pocket a bonus of more than $2 million this year after steering the 207-year-old organisation back to a slender profit.
Business
Don't miss out on the headlines from Business. Followed categories will be added to My News.
AUSTRALIA Post chief Ahmed Fahour will pocket a bonus of more than $2 million this year after steering the 207-year-old organisation back to a slender profit.
Despite meeting performance criteria, Mr Fahour last year turned down his bonus as the postal service struggled to get into the black. Costs were cut and stamp prices increased.
The postal chief took home a $2.6 million bonus in 2014, for a total pay and perks package of $4.6 million.
It is believed his pay and perks will be similar this year after Australia Post in August revealed it had delivered a $36 million net profit for the year to June.
Its letters business, which is shrinking at a rapid clip, still suffered losses of $138 million in the past year.
But the shortfall was offset by the parcels operation, which chalked up earnings of $314 million.
A year earlier, the postal service had suffered a loss of $222 million — its first annual loss in more than 30 years.
The executive pay details will be revealed in Australia Post’s annual report, due out this month.
Mr Fahour has a tough job on his hands transforming the postal service into a global logistics player if it is to prosper as its letters business withers.
Australians are eschewing sending letters — the old-style “snail mail” — for email and online.
While many elderly Australians prefer traditional letters, the mass exodus means Mr Fahour has to manage the decline while also adhering to government rules to deliver to everyone in the nation, and while keeping the organisation solvent.
In recent months, the authority has spent almost $100 million on a 4.5 per cent stake in Dubai-based logistics heavyweight Aramex.
The bonus means Mr Fahour is paid more than another high-profile public servant, NBNCo chief Bill Morrow, who made $3.6 million in pay and perks in the past financial year. Mr Morrow tripled his bonus from $483,000 to $1.2 million.
When Mr Fahour voluntarily gave up a bonus of more than $2 million last year, six other Australia Post executives also gave up combined bonuses valued at $1.5 million.
The executives declined their bonuses as the organisation suffered its first annual loss in three decades, with Mr Fahour telling the board he also “shares the pain”.
Last year Mr Fahour fought a battle to have the regulatory restrictions around the company loosened, which led to changes in January.
For years stamp prices had been held steady at 70c and Australia Post was not allowed to offer a “priority” service.
Under the changes, stamp prices rose to $1, although the concession price for 5.7 million Australians will stay at 60c and greeting cards at 65c.
There is now also a two-speed letter service, with normal post two days slower than a more costly one-to-four business day priority service.
NOW FOR THE POST E-BIKE
Online shopping obsessed Aussies are driving a change of wheels at Australia Post.
Australia Post has started trialling a new model electric vehicle that increases the number of parcels posties can carry from 30 up to 100.
It comes as Australians in the first six months of the year increased their online purchases by 16 per cent on the same time last year.
This is tipped to increase even further.
Parcels now generate more than half of Australia Post’s revenue — a segment that is growing rapidly — after making up less than a quarter of revenue a decade ago.
The e-vehicle trial comes after Australia Post last month revealed a $36 million net profit — a $258 million turnaround from a year ago.
Chief executive Ahmed Fahour said the new electric trikes mean posties will be able to carry larger parcels, traditionally handled by van drivers.
“We are finding the humble motorbike or push bike, which was great for delivering letters was not good for parcels,” he told Business Daily.
“We’ve been working with employees and unions with trials for alternative modes of transport. We have seen how successful these were in New Zealand, so we are taking up trials in the next six to nine months.”
He said they could be on suburban streets by mid next year.
Mr Fahour said the move was about ensuring posties remained part of the revenue growing areas of the business in order to ensure their future.
How the NBN has delivered just in time
The NBN has delivered, and it has done so in what can only be described as the ultimate — the hit-the-ground running immediate — stress test, rites Terry McCrann.
Sydney airport the wrong place at the wrong time
Sydney Airport has some of the sweetest acreage in Australia but when passengers numbers have dwindled from 9 million in the March quarter to 400,000 in the June quarter, that doesn’t count for much, writes Terry McCrann.