For the six months ended 31 March 2010, MaltaPost registered a pre tax profit of €1.86m (2009: €1.92m) and €1.18m profit after tax as compared to €1.14m for the corresponding period last year, representing an increase of 3.5%.

The main factors underlying the performance for the period under review, in comparison with the same period last year, are as follows:

* Revenue increased marginally to €10.55m. The traditional domestic postal market registered a slight increase over last year. This was further complemented by an increase in the international mail business;

* Employee benefits expense increased by 5.8% to €5.09m;

* Depreciation increased by 8.1% to €440k as a result of upgrading the Company’s branch network in order to improve customer experience and to prepare for new business opportunities;

* Other expenses decreased by 6.2% to €3.31m in the continuing effort to improve the efficiency of business processes;

Shareholders’ funds increased to €11.92m from €10.88m as at 30 September 2009. This was principally due to the considerable number of shareholders opting for scrip dividend in preference to receiving their dividend in cash.

The competitive environment and outlook for the Company continues to be determined to a substantial degree by the effect that e-substitution is having on traditional mail volumes and the impact on its main source of revenue. However, the general decreasing trend of the traditional mail market continues to be substituted by increases in international inbound mail as a result of growth in internet mail-order. Increasing local and international competition, especially in the packets and parcel business, means that the Company must continue to strive for excellence in all its operations, maintain high levels of customer service and adapt its products to meet clients’ requirements. The Company intends to further diversify the business into low cost financial services and the provision of bespoke back office processes.

The Board has taken into consideration the evolving market situation and, to date, the directors do not envisage any occurrence which could prevent the Company from achieving the targets set for the financial year. Furthermore, it believes that the Company continues to have a sound balance sheet which enables it to move forward with its plans from a position of strength. The performance for the first half of the financial year is the result of the good work by management and staff as well as the continued support of the customers of MaltaPost.

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