Brewer said the move would not incur additional capital expenditure because the costs would be borne by the operator that would lease the space from Pos Malaysia.
KUALA LUMPUR: Pos Malaysia Bhd
is planning to monetise the retail and warehouse spaces it owns around the country.
The company, which is part of DRB-Hicom Bhd, is in the midst of a turnaround plan.
“Increasingly, we see ourselves being a landlord and we would like to (repurpose) and lease out the retail spaces which have post offices in it,” said Pos Malaysia group chief executive officer Charles Brewer at a media luncheon and briefing here yesterday.
“We may own the land where the four walls are built on, but what we do within the four walls will be renting out some space. We are hiring a team of people for this purpose. We would like to increase our revenue per sq ft which will get us to break even,” Brewer added.
Brewer explained to StarBiz on the sidelines of the media luncheon that it would not need to incur an additional capital expenditure (capex) since the costs would be borne by the operator who would be leasing the space from Pos Malaysia.
“We want to monetise the land this way. In fact many postal services companies around the world are facing this predicament where almost everything is done online. Some of them have decided to sell the land that they own,” he said.
In his presentation, Brewer also said the company might incorporate retail elements into existing land space that it owns such as pharmaceutical or electric vehicle charging.“In terms of retail, we are still learning what works and doesn’t or the ones that create values.
“We have 631 locations but we won’t do them in all of these locations. What we offer in Kota Baru may be different from what we offer in Kuala Lumpur or Ipoh. There will be elements of localisation,” he said.Brewer added that retail was both a challenge and opportunity for the group.
“Some 70% of the costs to operate in those locations are staff-related costs and we do have 1.2 million unique visitors every month,” he said.
“The number of people coming to the post offices have declined since many transactions can be done online. We need to think and reimagine how to leverage the 3.2 million sq ft of retail space that we have.
“How do we repurpose this to generate increased footfall and sales?”
He explained that as much as possible, costs associated with any business plan would preferably be incurred as operational expenditure.
To a question as to when a possible break-even and an eventual return to profitability would happen, Brewer did not commit to a timeframe.
“We are cautiously optimistic that the company will deliver improved results in 2023 from 2022. It is not a walk in the park but it should be better,” he said.
In the financial year 2022, Pos Malaysia reported a net loss of RM167.67mil.
Brewer also shared that apart from the retail segment where post offices are parked under, the courier business segment is currently struggling.
“The two segments are the main headwinds for us – parcel and retail. In parcel, it is difficult to make money. There are too many players in the market presently. We have 120 licences for 33 million people. Indonesia has 30 licences for 400 million people and Thailand has 37 licences for 70 million people,” he said.
