USPS reports $1.8bn revenue drop
The US Postal Service (USPS) has reported a revenue of $69.6bn for fiscal year 2017, which was down around $1.8bn on last year.
In a statement sent to Post&Parcel today (14 November), USPS said that revenue drop was “driven largely by accelerated declines in First-Class and Marketing Mail volumes”.
Mail volumes for the year were down 3.6%, or 5bn pieces. On the plus side, package volumes grew by 11.4%, or 589m pieces. Although the package growth offset the mail drop to some extent, the overall volume declined by 4.9b pieces.
USPS said that the growth in its Shipping and Packages business “provided some help to the financial picture of the Postal Service as revenue increased $2.1bn, or 11.8%”. However, that growth was offset by the drop in mail volumes, “as well as a $1.1bn 2016 noncash change in accounting estimate and the 2016 roll-back of the exigent surcharge mandated by the Postal Regulatory Commission (PRC) which further reduced revenue by $1.1bn from what it otherwise would have been”.
The reported net loss for the year was $2.7bn, a decrease in net loss of $2.8bn compared to 2016. Of this decline in net loss, said USPS, $2.4bn was “the result of changes in interest rates, outside of management’s control, that reduced workers’ compensation expense compared to last year”.
Not for the first time, US Postmaster General and CEO Megan J. Brennan described the USPS financial situation as “serious, though solvable”.
Brennan added: “There is a path to profitability and long-term financial stability. We are taking actions to control costs and compete effectively for revenues in addition to legislative and regulatory reform. We continue to optimize our network, enhance our products and services, and invest to better serve the American public.”