Operator's assistance. I would now like to turn the conference over to Harold Hagenauer, Head of Investor Relations. Please go ahead.
Good afternoon, ladies and gentlemen. Welcome to this conference call of Austrian Post, where we would love to discuss our start into the year 2021. And so I want to hand over to our CFO, Walter Bilgin.
Good afternoon, ladies and gentlemen. It's a pleasure to have the opportunity to Give you an update on where Ostrempose stands after Q1. I think overall, I can summarize that Q1 has been a strong start Into the New Year despite difficult despite the difficult environment. Let me start on Page 3, Summarizing who we are, we last year showed revenue of 2.2 €1,000,000,000 and EBIT of €161,000,000 We operate in the 3 well known segments. Mail, this is our incumbent Austrian Declining business, Partner and Logistics, this is our growth engine covering Austria and eight Geographies, including Southeastern Europe and Turkey, and Retail and Bank.
This includes our retail network and our newly It's Bank 99. The pie chart on the right side shows you the revenue mix of Q1. And it's a pleasure To inform you that for the first time after Q1, we show Revenue distribution, where our parcel business is equally strong is our mail business Our Austrian parcel business is equally strong as our addressed letter mail business. So The transformation that we are in from a predominantly male dominant group To a group that stands on 2 strong legs is well underway, has been accelerated by the pandemic. Page 4, I think shows you this in a quite compelling way.
2 years ago, our parcel and logistics revenues made up A little bit more than a quarter of our group revenues. This Q1, Parts and Logistics made up 49.7 Percent of our revenues, of course, this includes the revenue of ARRAS Cargo, which is now for the first time fully consolidated in Q1. But with those 49.7%, our Partner and Logistics business is a little bit stronger And bigger than our main business. To summarize Q1, as I said, a good start into the year. Of course, COVID-nineteen still substantially influenced our business environment and also continue to challenge our operations.
I think on the health aspect, I think we had a Quiet Q1 with our safety measures working well and protecting our workforce. Accordingly, we had very smooth operations that also resulted in good productivity and cost efficiency. On the volume side, of course, the pandemic continued to negatively impact our letter mail and predominantly our Direct mail volumes, for those of you who are not familiar with the Austrian situation, we had 5 weeks of relatively strict lockdown at the beginning of the year. Then shops were allowed to open up again with restaurants and hotels still closed. And then at the end of March, Eastern Austria, again, went into a strict lockdown, which lasted until a few days ago.
As of May 19, Austria will step by step reopen. So restaurants and hotels and a lot of other service industries will be allowed to open again. But in Q1, The 5 weeks of lockdown in January were the predominant impact of the pandemic environment was negative impact on the mail side, but of course also Positive volume impact on our partial businesses across the regions. As a result, we had A strong revenue development as a group, revenues increased by 28.5%. Yes, this includes the inorganic Contribution of Abbascargo was around €83,000,000 out of this €646,000,000 Without that, you'll see that on the next page, organic growth was around 12.5%.
And the earnings well above Last year's admittedly weak Q1 EBITDA plus 51 percent to €99,000,000 and EBIT Up almost 80% to roughly €60,000,000 Page 6 shows you an overview of our revenue development. Already said That group revenues increased by 28.5 percent, excluding the contribution of RS Cargo. This translates into an organic growth of 12%. This is the combination of a Resilient Mail Business, which despite 5 weeks of full lockdown in Austria, showed a stable revenue development with minus 2.1 percent volume declined stronger than that, but we still had the impact The tariff reform implemented April 1 last year. On parcel and logistics, this was A very strong growth quarter with in total 85.6 percent of revenue growth with again ARRAT cargo contributing $83,000,000 of inorganic growth and also the Organic growth in all regions being above 30%, and we'll come to more details later on.
Moving on to Page 7. EBIT, given this strong revenue development and smooth operations, increased by Almost 80% to almost $60,000,000 Of course, Q1 2020 was $33,300,000 was Weaker than a typical Q1. I think we're all aware that the pandemic started to hit us in mid March and the second half of March showed strong last year, so it showed strong direct mail decline, direct mail volume decline and a Parcel Business, which did not yet show the strong growth that we saw a few weeks after that, the first impact on Parcel and Logistics Last year had been that P2B revenues were negatively impacted. So Q1 in total last year was, of course, already the start into a difficult period. But even compared to Previous Q1s, the 59.8% is a strong start into the year.
And The composition of the revenue shows you that our still strongest EBIT contributor mail It was relatively stable with €45,500,000 revenues. Parts and logistics EBIT almost quadrupled from Around €8,000,000 €8,000,000 €9,000,000 to almost €36,000,000 And our Retail and Bank segment, which showed Good. Operative development, of course, not supported by the pandemic, showed an operative positive EBIT Development, one off negative effects from staff related provisions caused a small decline In EBIT in the corporate segment, a little bit on the positive side. Let me now proceed with an update on our strategy implementation. Page 9 reminds you of the New framework that was the result of the strategy update last year with 3 core business priorities.
Number 1, defending our leadership and profitability in the core business, meaning our core Austrian Mail and Parcel Business. Priority number 2, Growth in near markets. This is about growth in parcel and logistics internationally, in particular, East of Austria And about growth in value added solutions and services along the value chain, left and right from May and Patos. In priority 3, continue to develop our retail and digital offering private customers and SMEs, this is about our retail network, about our bank, about our online marketplace shopping And about a few other consumer focused initiatives. And then we have a 4th important priority, Which covers all business segments, which is about sustainability, diversity and customer focus As overarching priorities and will give you a brief update on our efforts and progress on the Sustainability side.
Later on, I last time gave a more extended Talk about our ambitious targets in that field and the comprehensive program. Let me start on Page 10 With an update on our letter mail business, excuse me, our letter mail business last year Declined around at a rate of around 7% after around 4% to 5% in previous years. Q1 resulted in a letter mail decline of around 6%, which I think It was within expectations and over you see the monthly development on the right side. And without over interpreting individual months, I think the message is that lockdowns also impact our addressed Letter Mail business, once the economy reopens and scale speed again, also our Letter Mail revenues and volumes start to recover a little bit still. We have to expect a Somewhat higher mail volume decline as a result of the pandemic.
Page 11, moving to Direct Mail and Media Post business in Austria, this is the business segment which has been hit most heavily and most immediately by the pandemic. Last year, revenue and volume decline of 11.3%. While we see shops and our customers increasingly Better equipped to handle lockdowns. Still, of course, the 5 weeks of lockdown in May Again, hit this business and volumes were down 8.5% compared to Previous Q1, which again included already 2 weeks of strict lockdown, but you also see here In the monthly development that once shop reopen, this business at least partially comes back. We have the REIT.
The food retailers is a very stable element in our customer portfolio And the non food retailers are, of course, not distributing direct mail when they have to close. And this is also the segment which where the pandemic will have also longer lasting impact As of course, this segment suffers most from the success of e commerce. So I think still We have to expect that this business segment remains under pressure also going forward. Page 12, moving to our Austrian Pasha business, which is, of course, in terms of volumes benefiting So from the increased e commerce shopping activity that the pandemic has induced, Last year, volume growth of 30 percent to record volumes of 166,000,000 Partially shipped in delivered in Austria, and this growth dynamic continued in Q1, 33.5%. We should not expect this strong growth to continue for the remaining three quarters As we are now comparing ourselves against very strong individual months last year with April May Being last year record months with volume growth compared to 2019 compared to pre pandemic of 40% 50% plus.
Still, we do what we see from the last weeks That we do not fall behind these record volumes of April early May. And I think we are optimistic that also for the remaining three quarters, we will be able to show a net growth in volumes. Moving on to Page 13. This strong growth in parcel has led us to accelerate our Capacity expansion program in Austria, but also in our other geographies, we are currently in a Few bigger projects well underway. Bigger project is a new logistics center in Tyrol.
1 is the 2nd expansion base now of our logistics center in Alhamming in Upper Austria, Yes, which should come into operation next year. This is only a selection. The next page then gives you a broader Road map of the individual project, but the impact of this is that we will see most probably a record Here also in terms of CapEx, on top of $7,000,000 to $80,000,000 maintenance CapEx, we will So you have $20,000,000 to $30,000,000 CapEx also internationally, of course, also a large parcel network such as ARAV Cargo represents. With the strong growth, they have required investments into capacity expansion. And then in Austria, we expect to spend Around €20,000,000 on properties and at least €60,000,000 in gross related CapEx for buildings and equipment.
Page 14 shows you the more detailed road map. I will move on to Page 15, Giving you an update on the development of our staff structure and numbers in Austria. I think 2 messages. 1 is we have been a stable and secure employer throughout the pandemic. We've been one of the few Austrian companies, bigger Austrian companies, who has hired new and additional employers.
Have used none of the state subsidy schemes such as furlough schemes, Guetzalbert. On the other rather the opposite is true. We have increased our staff year on year comparison by almost 700 Employees to handle the strong growth in parcels and also to substitute 1 or the other subcontracted delivery Agent and also in sorting centers, we increased our own workforce. So this is message number 1, Increased number of employees. Message number 2 is that the transformation from Expensive civil servant contracts and contracts under the old collective wage agreement to new collective wage agreement is continuing.
We now have a substantially larger workforce already under the new collective wage agreement than under the Oates teams. But still, there is further cost relief from continuing this transformation to be expected in the coming years. Moving on to Page 16, to our second Strategic priority growth in your markets, as we said, with 2 sub priorities. 1 is Enhancing the value chain was value added services, on the one hand around Mail and document services with scanning services, printing services, But also around the parcel value chain, e commerce value chain with warehousing, order picking and Shipping services, in particular, this area showed a very good development over the last months. We also were able to Help in mastering the pandemic with Logistics Services around testing, Mass distribution and information services using traditional mail And other communication products of Austrian Post to inform about vaccination.
And increasing speed is also shown in the development of our digital Business models such as ACL, our e commerce software solutions provider in the group, which showed very good revenue And EBIT Development. So this is priority 1, the sub priority number 1. The bigger sub priority in this growth in new markets is the growth in international Markets with parcel and logistics, most importantly, of course, with parcel delivery networks, you see here the markets that we Cover Southeast of Austria and as of August last year also including Turkey. Page 17 shows you the volume numbers that this growth over the last That Kate has resulted in. We started with $7,000,000 in parcels in 2,009, delivered internationally and last year delivered, Including Ares for the full year, euros 250,000,000 parcels from that base.
Q1 Again, showed very good growth with 35% to 40% growth in the individual markets. And we are very satisfied with how our international portfolio has been developing over the last 12 months. In particular, pleasing with the development of Avast Cargo on Page 18. We have Given overviews in the previous quarterly communications, Q1 has shown spectacular growth, Revenue growth of 69% compared to previous Q1, revenue volume growth of 37%, Which I think also makes clear that the company is able to implement Price increases above inflation, resulting also in margin expansion. And as a result, there was also very good EBIT contribution from Cardo to the group.
Moving to the 3rd strategy pillar, our Retail and Bank and Consumer Business in general. Bank 99 continues to develop. Of course, the pandemic is somewhat hindering new customer acquisition And some transaction service segments of the bank. Still a year after the start, almost 80,000 current account customers, I think, is a very good Development after 1 year. And as you see on Page 20, we are now working On expanding the product offering of Bank 99, I think we have well established payment services This current account was a very well functioning current account product with various subcategories established last year, And we are now building a product portfolio of loan products, Including consumer loans that we have established with a partner, This is not coming on our own balance sheet.
And later in the year, we plan to add housing, So mortgage loans and investment products. So I think good development there. Then an important element of our 3rd strategy pillar is also to further develop our Consumer self-service solutions, you see here this well known chart, which continues to show upwards. All our self-service solutions are well established. We continue to invest in these services.
They are a source of differentiation in a competitive marketplace, Well accepted by the consumer at consumer convenience and safe process costs. A brief update on our sustainability efforts. Let me just briefly remind you about the targets we communicated last time. Our aim is to reduce the specific CO2 footprint. So the CO2 footprint per shipped ton by 70% from 2,009 to 2,030, about 40% the absolute footprint from Basically, last year to 2,030.
And the 3rd ambitious target is to Deliver all mail and password fully PO2 free Not only CO2 neutral as we do it since 2011, including substantial Compensation with CO2 certificates, no, by 2,030, we want to have eliminated the last combustion engine from our delivery fleet. We are well on track with that program with more than 2,000 electric vehicles in our fleet. This year, as you see here On this chart, which gives you a few examples of recent priorities on the Our sustainability program, you see that we have ordered already 600 additional new vehicles this year. We are well on track with a pilot in the urban area of gas where we want to, For the first time, eliminated combustion engines in a full larger urban area, Including also the delivery of Parcel, already 50% implemented this project. And you see also in other Elements from the customer sustainability side to social aspects of our sustainability That we implement every month additional initiatives On the social side, for example, one of our priorities, of course, has been to support both On a national level, but also within the company to fight the pandemic, We are we have established more than 35 vaccination sites.
And Now I hope that soon also the chats will arrive. Yes, let me now I'll conclude before I finish then with the outlook with a few more details on our financials. Page 25 shows you the core KPIs. I think quite good EBIT. GA and EBIT margins was 15.3% 9.2% and a good start into the year with an earnings per share of $0.71 and a cash flow of $74,000,000 in operating cash flow.
Let me maybe Jump the income statement on Page 26 and move right away into the segments. Page 27, To see a little bit more sheds a little bit more light on our Mail division, the core letter Mail segment With the support of the tariff increase last year showing a slight plus On the revenue side, plus 1.1%. So this is kind of The net of a 6% volume decline and positive tariffs and also Mix effect, given that we also have e commerce volumes flowing Into these products with a larger per piece revenue. On the direct mail type, we see that kind of the decline of volumes almost 1 on 1 translated into revenue minus 8%, again 5 weeks of lockdown Left their marks. Page 28, the summary of the Income statement of the Mail division revenue was down minus 2.1%.
I've already commented on the individual product groups. EBIT down minus 3%, but still I think given the environment, it's €45,500,000 in Q1 and EBIT margin of 13.6 I think those numbers show a resilient mail business and show also that our efforts to contain cost And take off costs when volumes decline pay off. Moving to Page 29,000,000 to our Partner and Logistics division, revenue up 85.5%, almost $233,000,000 coming from Aras Cargo, which for the first time in Q1 is fully consolidated. Austria showing a revenue increase of almost 40% and also Eastern Europe Showing a good revenue development above 30% growth. Income statement on Page 30, the good revenue development combined with Smooth, efficient processes, also enhanced productivity through additional capacity that brought online good progress On the final integration steps from resulting from the takeover of DHL Resulted in a strong margin improvement.
Also international portfolio, including Turkey, A strong contribution to absolute EBIT and margin expansion. So it's Almost $36,000,000 almost quadrupling of last year's Q1 EBIT. Whittel and Bank segment, revenue growth of 27% from 3%, mostly coming from the fact that last year In Q1, we didn't have a bank yet. So I think operationally good progress. Of course, as I said already, not Supported but hindered by the pandemic, P and L of this segment, Page 32, Shows a small EBIT decrease.
This is, to a large extent, Due to a one off staff restructuring provision that we've booked on an operational level, Both our retail network as well as our bank showed improvements to compared to Q1 last year. Yes. Let me now Close the financial part with our balance sheet, with the balance sheet update and update on cash flow development. We continue to show a conservative balance sheet with a stable Absolute amount of equity around €700,000,000 This is before paying out a dividend of 108,000,000 which we did end of April. I think key highlights of our balance sheet include a A cash surplus of $230,000,000 for the whole group, as I said before, dividend payout, A stable level of provisions, Slightly increased even we continue to be conservative in accounting and an extension of the balance sheet Mostly due to the fact that our bank with every customer grows the balance sheet.
But I think overall, a very conservative balance sheet. And also, As in the past, we have any pension obligations. Page 34, update on cash flow development. CapEx activity in Q1 was still a little bit slow. There's a lot more to come in the remaining three quarters.
Operating free cash flow before growth CapEx was At $74,400,000 substantially above last year and free cash flow after growth I think it's at $70,000,000 I think a good start into the year. And we continue to see a business That generates great cash. Yes. Let me now conclude with the outlook, Which is in terms of core trends and market environment It's pretty much unchanged. In terms of outlook on revenue and earnings, it's slightly improved.
We Continue to see a volatile and challenging market environment, which continues to be impacted by the pandemic and government imposed measures, although we are optimistic that we I'm now entering a new phase in the pandemic development. And Also in Austria, we have about 40% of the population already being Vaccinated or recovered from COVID-nineteen and Vaccination momentum gathers pace. And so I think the opening plans seem quite robust. We do hope that we will see this reflected also in the development of the business segments that have been negatively impacted by the pandemic. By the pandemic, specifically for our business, this environment It means that we continue to expect strong growth on the parcel and logistics side with more than 25 Including the contribution of our cargo, we expect our mail revenues coming out Roughly where we were last year.
So either stable or slight decrease. We continue to expect ongoing revenue growth in our Retail and Banks division. I already gave The details of our CapEx outlook is a little bit higher than last time given the strong volume development and the need to accelerate Investment programs and on earnings, we now guide for an EBIT increase of about 15% compared to 10% Well, the last time with mail again being roughly stable On the parcel side, we see at least 25% earnings decrease. We also do expect improved operational earnings level in the Retail and Bank division. And yes, I think overall, we would see this outlook as still being a little bit more on the defensive side Despite having had a very good Q1 and also good business momentum continuing into April, we still see A quite volatile and uncertain environment ahead of us and do remain cautious.
So thanks a lot for your attention, And I'm now happy to take questions.
Ladies and gentlemen, at this time, we will begin the question and answer session. Our first question is from Alvear from LVNV. Please go ahead.
Hello. Quick question from my side. Can you provide some kind of visibility in terms of Are the cargo contribution to EBIT and cash flow? Thank you.
Yes, we can. However, please bear with us that we do not provide full details. We Had a very positive EBIT contribution, double digit level of margins, and we had a positive Contribution also to group cash flows.
Okay. And you don't provide any kind of Because obviously, for all the other segments you provide on the presentation of discrimination, within the segment, how much they contribute to Abbott? On the case of Parcels, You basically only disclose like premium and stuff. You don't have any and can't you provide any kind of numbers In terms of contribution profitability?
I think overall, we do not provide EBIT contribution Below the segment level, we do provide revenue contributions, both on the Mail and Parcels segment, and the revenue split is strong in the presentation. In the presentation, Aras Cargo on a revenue, so €83,000,000 Euro revenue in local currencies was up 69% compared to last year, volume up 37%. And as I said, double digit EBITDA margin.
Okay. So that was my first question. Just a second follow-up very quickly. Looking at the €83,000,000 contribution for revenue from ARES Cargo and looking at your segmentation between Austria and CE revenues, It seems that the revenues from outside of ARESCAR actually were at a significant decline Revenues, is this true?
No. In the whole division, maybe to go back to The growth of revenue growth we've been having. We had $150,000,000 revenue growth in parcel. So $83,000,000 revenue growth came from Ricky, a €10,000,000 revenue growth came from TME and €10,000,000 revenue growth came from Austria.
Okay, perfect. Thank you so much.
You're
welcome. The next question comes from Bernd Maurer from Raiffeisen Bank International. Please go ahead.
Hello and good afternoon. One question I do have. When you look at Extraordinary personnel expenses, you had some €10,000,000 perhaps a bit more in Q1. Would you say that it was the fault of Extra charges of provisioning you expect for this fiscal year to be booked in Q1? Or Can we reckon with a bit more provisioning than in the last 3 years going forward?
Or was this now Related to the bank done in Q1 and small provisioning on it to expect it going forward?
I think it's the character of provisions that you have to book them once the topics arise, so it's hard to forecast Yes. So sorry that I cannot give you the more forecast As expected provisions, there's nothing we see on the horizon, but which doesn't mean that We might not come to the conclusion that we have to put further restructuring provisions here or there. But Given our staff development and given that some of the bigger discontinuities around The recent network in the bank are rather behind them ahead of us. I would not expect too much to come. But The year has only 4 months.
Yes. Okay. Thank you. For details, I have just follow-up. When looking at the cost Split now after the consolidation of Aras Cargo.
Would you see Q1 cost split of kind of representative going forward? Or was there something included?
But you said
it's a bit distorting the picture and we should rather not take the cost Q1, it's a proxy for the quarter, so Tom, knowing that Q4 has its seasonality items.
Yes. I mean, of course, I don't need to explain to you that our business is has Strong seasonal fluctuations on the revenue side and we quite balanced those with adjusting most of the cost base. And Q1 is after Q4, The 2nd strongest quarter and you went into 3 of the weaker quarters. What I would say in terms of cost structure, if that was your question, I think There is no reason that Q1 should not be reflective of the full year cost structure.
Thank you very much.
I just want to say, of course, There's a mix change from mail to parcel. Of course, our cost structure also changes a little bit For classes, we have more subcontracted costs on transport on last mile delivery. But I think this is a more gradual change than but Q1, I think, is By and large, quite reflective of the full year.
There are no more questions in This concludes our question and answer session. I'd like to hand it back to Harold Hagenauer for closing comments.
Thanks, ladies and gentlemen, for participating in this call. Obviously, everything was made clear to If you have some more questions the next stage, please don't hesitate to call us directly And we can clarify everything, of course. So happy to say, see you next time.