2.7 Segment information
Accounting policies
PostNL reports two operating segments: Parcels and Mail in the Netherlands and one other segment: PostNL Other. Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-makers. These chief operating decision-makers, who are responsible for allocating resources and assessing the performance of the operating segments, have been identified as the Board of Management of PostNL that makes strategic decisions. Transfer prices between operating segments are on an arm's length basis and intercompany sales relate to similar activities as revenue. PostNL Other represents head office entities.
The following table presents the reconciliation of the 2023 segment information relating to the income statement of the reportable segments. Segment information relating to the balance sheet is reported in note 3.11.
PostNL Segmentation in € million
2023
| Year ended at 31 December 2023 | Parcels | Mail in NL | PostNL Other | Eliminations | Total |
|---|---|---|---|---|---|
| Revenue from contracts with customers | 1,975 | 1,174 | 5 | 3,153 | |
| Intercompany sales | 282 | 192 | 240 | (713) | 0 |
| Other operating revenue | 4 | 7 | 0 | 12 | |
| Total operating revenue | 2,260 | 1,373 | 245 | (713) | 3,165 |
| Other income | 3 | 8 | (2) | 9 | |
| Depreciation/impairment PP&E | (33) | (12) | (4) | (49) | |
| Amortisation/impairment intangibles | (2) | (2) | (52) | (57) | |
| Depreciation/impairment right-of-use assets | (48) | (12) | (12) | (72) | |
| Total operating income | 43 | 47 | (6) | 84 | |
| Net financial income/(expense) | (2) | ||||
| Results from investments in JVs/associates | (4) | ||||
| Income taxes | (24) | ||||
| Profit/(loss) from discontinued operations | 1 | ||||
| Profit/(loss) for the year | 56 | ||||
| Normalised EBIT | 47 | 50 | (5) | 92 |
The key financial performance indicator for management of the reportable segments is normalised EBIT. Normalised EBIT is derived from the IFRS-based performance measure operating income adjusted for the impact of project costs and incidentals. Normalised EBIT is reported on a monthly basis to the chief operating decision-makers. The following table presents the reconciliation from reported operating income to normalised EBIT.
PostNL From operating income to normalised EBIT in € million
2023
| Year ended at 31 December | Reported operating income | Project costs and other | Normalised EBIT |
|---|---|---|---|
| Parcels | 43 | 4 | 47 |
| Mail in NL | 47 | 3 | 50 |
| PostNL Other | (6) | 1 | (5) |
| Total 2023 | 84 | 7 | 92 |
From operating income to normalised EBIT
In 2023, normalised EBIT totalled €92 million (2022: €84 million). Normalised EBIT excludes exceptional items, which amounted to €7 million in 2023 (2022: €1,375 million). In 2023, the normalisation for project costs and other included results related to legal advisory costs (€2 million), claim-related costs (€3 million) and discontinuation costs of two specialised logistics services (€3 million). The increase of €8 million in normalised EBIT comprised lower results in Parcels (€9 million) and Mail in the Netherlands (€57 million), offset by a higher result at PostNL Other (€75 million) mainly caused by lower pension expenses due to the change to a collective defined contribution scheme.
The following tables present the reconciliation of the 2022 segment information relating to the income statement of the reportable segments. Segment information relating to the balance sheet is reported in note 3.11.
PostNL Segmentation in € million
2022
| Year ended at 31 December 2022 | Parcels | Mail in NL | PostNL Other | Eliminations | Total |
|---|---|---|---|---|---|
| Revenue from contracts with customers | 1,918 | 1,211 | 2 | 3,132 | |
| Intercompany sales | 242 | 277 | 212 | (731) | 0 |
| Other operating revenue | 5 | 7 | 1 | 13 | |
| Total operating revenue | 2,165 | 1,495 | 215 | (731) | 3,144 |
| Other income | 0 | 7 | 0 | 7 | |
| Depreciation/impairment PP&E | (28) | (14) | (4) | (46) | |
| Amortisation/impairment intangibles | (2) | (2) | (40) | (44) | |
| Depreciation/impairment right-of-use assets | (43) | (12) | (11) | (66) | |
| Total operating income | 54 | 98 | (1,443) | (1,291) | |
| Net financial income/(expense) | (19) | ||||
| Results from investments in JVs/associates | (1) | ||||
| Income taxes | 330 | ||||
| Profit/(loss) from discontinued operations | (11) | ||||
| Profit/(loss) for the year | (993) | ||||
| Normalised EBIT | 56 | 107 | (80) | 84 |
PostNL From operating income to normalised EBIT in € million
2022
| Year ended at 31 December | Reported operating income | Change in pension accounting classification | Project costs and other | Normalised EBIT |
|---|---|---|---|---|
| Parcels | 54 | 2 | 56 | |
| Mail in NL | 98 | 2 | 7 | 107 |
| PostNL Other | (1,443) | 1,355 | 9 | (80) |
| Total 2022 | (1,291) | 1,357 | 17 | 84 |
Reference is made to note 3.5 for further information on the normalised impact of the change in accounting classification of our main pension plan. In 2022, the normalisation for project costs and other included results related to legal advisory costs (€6 million), settlement costs (€9 million) and discontinuation costs of an in-house Food delivery network (€2 million).