PostNL, the post,  parcels and e-commerce group based in The Hague, reported operating profit fell to €225m in 2017 from €255m the previous year as ‘heavy competition’ ripped into revenues and mail volume fell.

The company said on Monday that competition on the mail market heated up in both its home market as well as in operations in Germany and Italy.

In addition, the company said it had experienced a heavier than expected loss of volume to other postal concerns due to a ruling by competition watchdog ACM last summer.

The ACM said PostNL had substantial market power and ordered it to open its sorting and delivery networks to rival providers at pre-established prices. CEO Herna Verhagen said the effects of that decision were worse than anticipated and the full damage would not be apparent until 2020.

To compensate for the decrease in postal volumes, PostNL will make cost cuts of €40m, mainly in overheads. Results will be seen ‘towards 2021,’ she said.