Australia Post boss Ahmed Fahour resigns, despite profit rebound

Australia Post boss Ahmed Fahour resigns, despite profit rebound

Australia Post boss Ahmed Fahour resigns, despite profit rebound

Updated 23 February 2017, 13:45 AEDT

Australia Post's managing director Ahmed Fahour resigns, despite the business posting a large profit turnaround due to online shopping parcel deliveries.

Australia Post's managing director Ahmed Fahour has resigned, despite the company posting a large profit turnaround.

Earlier this month, Mr Fahour was the subject of intense criticism for his $5.6 million dollar annual salary, with Prime Minister Malcolm Turnbull describing it as too high.

Amid media reports that Mr Fahour had quit, this afternoon Australia Post released a statement confirming his departure, saying he tendered his resignation at a board meeting yesterday.

Australia Post's chairman John Stanhope paid tribute to Mr Fahour, saying he had successfully turned around the failing government enterprise.

"Ahmed was appointed at a time when Post was still highly dependent on revenue from the letters service, but the community's use of letters had already peaked and was in the early stages of decline," Mr Stanhope said in a statement.

"He led the team that developed an entirely new strategy focused on investing in the parcels and eCommerce business.

"It was the right strategy. It has put Australia Post on a pathway to a sustainable future and avoiding a taxpayer bailout."

Australia Post profit rebounds

Mr Fahour's resignation comes despite today's announcement of a return to profit growth for the business.

Australia Post's half-year profit has surged to $131 million after tax in the six months to December, helped by strong growth in its parcels delivery service.

That was a huge jump from its $16 million profit during the same period a year earlier.

Its group profit before tax surged to $197 million during the half, up from just $1 million in the prior corresponding period.

Group revenue increased by 8 per cent year-on-year to $3.52 billion for the half year.

Australia Post's profits in its parcels business surged 16 per cent to $189 million.

In recent years, the company has been transforming to focus on parcels delivery and e-commerce, and said 70 per cent of its revenue is now derived from those areas.

Australia Post's managing director and group chief executive Ahmed Fahour said the result was extremely pleasing.

"This is one of the strongest first half results in recent history," he said in statement.

"We are delivering more parcels than ever before, with domestic parcel volumes up 5 per cent in the first half, market share increasing and, at the same time, we're trialling new delivery innovations like evening and weekend deliveries to give our customers an even better experience."

Australia Post's letters division saw volumes slump by 11 per cent, but the company said those losses were stabilising.

"Without changes to the letters business introduced early last year, independent modelling suggests this loss would have been over $2 billion today," Mr Fahour said.

The company said all performance indicators, including on-time delivery for letters and parcels were either met or exceeded.

Australia Post will release its full-year results in September.