February 26, 2018 / 8:37 AM / a year ago

UPDATE 1-PostNL lowers 2020 target as regulatory change weighs

(Adds shares, comment, CFO)

Feb 26 (Reuters) - Dutch postal company PostNL said on Monday it was lowering its cash operating income target for 2020, as falling volumes and a decision by regulators that it must share its distribution network with rivals weighed on its earnings.

Shares in the company were down 16.3 percent at 0831 GMT.

Mail volumes in the Netherlands have almost halved since 2005, while the regulator’s move to allowed other postal operators to use the PostNL network at reduced tariffs, has increased competition.

“In Mail in the Netherlands the volume decline was high due to intensifying competition, which is being supported by regulation,” said Chief Executive Herna Verhagen.

The company sees a 50-70 million euro ($61.6-86.3 million) hit from the regulations, higher than originally estimated.

The company now targets underlying cash operating income of 230-300 million euros ($283.5-369.8 million) for 2020, down from the 310-380 million euros forecast in November.

For the fourth quarter, the company reported underlying cash operating income of 98 million euros, down 11 percent

The company proposed a dividend of 0.23 euro per share for 2017.

The company also said it plans to appoint Pim Berendsen as Chief Financial Officer on April 18, to replace Jan Bos. ($1 = 0.8114 euros) (Reporting by Charlotte Steenackers; Editing by Gopakumar Warrier and Louise Heavens)

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