Australia Post has delivered the federal government a $244 million dividend in 2012/13, but warns a decline in regular mail bodes badly for the business.

The postal agency's $312 million after-tax profit, up 10.9 per cent on 2011/12, came via strong growth in online shopping, the purchase of the StarTrack parcels service and cuts to running costs.

However, mail volumes continue to fall as more people turn to email.

"Australia Post now delivers one billion fewer letters per year than we did in 2008 due to the shift by both businesses and consumers to digital means of communication," chief executive Ahmed Fahour said in a statement.

Mr Fahour said the volume drop and the absence of a price rise for stamps during the year led to the regulated mail business losing $218.4 million in the past financial year.

"If unchanged, the widening losses in our traditional letter services will eventually stifle positive developments in our parcels business," he said.

Communications Minister Malcolm Turnbull has said the government has no plans to privatise Australia Post and Labor is opposed to the sale.

 

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