Canada Post profits down

The Canada Post segment has reported a profit before tax of $63m for 2015, down from $194m for 2014. In a statement issued on Friday (6 May), Canada Post said that the profit was “modest in comparison” to 2014 because it is facing the “significant challenges” of “declining mail volumes, an increasing number of addresses to serve each year, significant pension obligations and the ongoing need to invest in  infrastructure to continue to serve Canadians”.

The highlight of Canada Post’s results in 2015 was an “unprecedented growth in the Parcels line of business”, but this was balanced by a bills and letter decline of nearly a quarter billion pieces.

Focus on the parcels growth, the postal operator said: “The Canada Post segment’s expanding role as an essential enabler for online shoppers and retailers drove parcel deliveries to new heights in 2015. Following an unprecedented back-to-school surge in online sales in the third quarter, deliveries reached new records for the Canada Post segment. To meet the growing demand for parcel deliveries to Canadians, Canada Post responded with 16 delivery days of one million or more parcels each, and delivery of 2.2m parcels over eight weekends. The Canada Post segment Parcels revenue rose by 9.1% in 2015 compared to 2014, reaching $1.65bn and making Canada Post the largest parcel company in the country.”

Commenting on the mail sector, Canada Post said: “Volumes of Domestic Lettermail, the largest product category within Transaction Mail, declined by 5.2% or 187m pieces compared to 2014. Since Canadians’ use of paper bills, statements and letters peaked in 2006, Domestic Lettermail volumes have fallen by 32%, or 1.6bn pieces.”

As previously reported, the Canadian Government announced last week that it has instigated an independent review of Canada Post’s activities.

Canada Post responded by saying that it “welcomes” the review and it is “committed to actively participating in the process to help determine the best path forward given the ongoing challenges faced by the postal system”.