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MILAN, March 19 (Reuters) - Poste Italiane expects to increase operating profit by 47% to 2.2 billion euros ($2.6 billion) by 2024, with the help of cost cuts and higher revenue that will allow it to pay generous dividends.
Under a plan through 2024 announced on Friday, the state-controlled conglomerate, comprising financial operations including insurance and digital payments as well as its traditional mail and parcels business, targeted revenues of 12.7 billion euros in 2024 up from 10.5 billion in 2020.
With net profit seen rising to 1.6 billion euros in 2024 from 1.2 billion last year, Poste pledged to boost dividend payments by 6% a year, starting from a floor of 0.55 euros it will pay on 2021 results, up 14% from 2020.
Poste Italiane shares were up 1.3% by 1000 GMT, while the main Italian stock index fell 0.4%.
“What matters the most is the step-up in shareholders’ remuneration with the company setting a 60% payout as the new normal,” analysts at Mediobanca Securities said.
Poste Italiane said its mail and parcels division would turn into a “profitable logistics player” by 2025, when revenues from parcels operations would exceed general mail.
“The turnaround in mail and parcels is fully under way ... we will become a fully-fledged logistics player with a sustainable business,” Chief Executive Matteo Del Fante, a former JPMorgan banker, said in a statement.
The smaller payments and mobile division is expected to more than double revenue by 2024, helped by value-added services such as energy products to be offered in early 2022, the group said.
It also expects increased demand for its insurance services, supported by health and property protection after the COVID-19 pandemic.
Its financial services division, however, is projected to register a drop in operating profit in 2024, reflecting higher costs.
$1 = 0.8381 euros Reporting by Elisa Anzolin Editing by Valentina Za, David Goodman and Barbara Lewis