Following a 16.6 per cent increase in profit to $281 million, Australia Post has announced it will be putting $2 billion towards infrastructure, products and services to transform its national logistics network to a universal digital platform.

The investment will create a parcel delivery network that will improve automation and expand Australia Post's footprint across Australia, deliver convenience and choice in parcel delivery for both consumers and business, expand our network of retail superstores across the country and make available a secure, free, personalised Australia Post Digital MailBox to every Australian.

Australia Post managing director and CEO Ahmed Fahour said without making this investment, Australia Post would not be able to sustain the growing demand for parcel services.

“This investment will provide the infrastructure and delivery options to ensure Australian businesses and consumers can reap the benefits of the digital economy,” he said.

"An investment of this magnitude is only possible due to continued strong profit growth of 16.6 per cent in 2011/12 which has been achieved through disciplined cost management, innovation in our retail products and services and the continued growth in online shopping driving parcel delivery.

“This focus has helped Australia Post deliver a profit after tax of $281.2 million for 2011/12 and deliver a dividend to the Australian Government and community of $213.7 million."

Online shopping continues to grow in Australia, with local consumers spending a total of $11.9 billion in online retail sales in the last year – an increase of around 22 per cent, year on year. In good news for local e-tailers, more than 70 per cent of these items are purchased through local online retailers.

This growth in demand for parcels has resulted in Australia Post operating at peak levels throughout the year, not just at traditional peak demand times such as Christmas.

"This year we will invest significantly to ensure we deal with the Christmas rush effectively. Last year we delivered more than three million parcels in December alone. This Christmas will be even busier," Fahour said.

"We want to ensure that we are doing all we can to give Australia retailers and e-tailers the competitive edge this Christmas and we will work with them to help them meet their customers' expectations this holiday season."