USPS reports Q1 results
The US Postal Service (USPS) has reported controllable income for the first quarter 2018 (ending on 31 December) of $353m, down from $522m last year.
According to USPS, this decrease was “largely driven by volume declines in First-Class and Marketing Mail, higher normal cost of retiree health benefits expenses of $140 million and higher transportation expenses of $109 million, partially offset by a reduction in compensation and benefits expenses of $91 million”.
Total revenue for the quarter was largely unchanged at $19.2bn – but revenue from First-Class Mail and Marketing Mail decreased $309m and $248m, respectively, due largely to lower volumes. Revenue from the Shipping and Packages business increased $505m, or 9.3%.
Operating expenses for the quarter were up $2bn at $19.7bn, driven by increases in workers’ compensation expenses and retirement benefit costs.
The net loss for the quarter was $540m, compared to a net income of $1.4bn for the same period last year.
Package volumes grew by 111m pieces, or around 7%, while mail volumes declined by 2.0bn pieces (5%) – continuing what USPS described as a “multi-year trend of increasing package volume and declining letter volumes”.
USPS also noted that it set a new record on 18 December when more than 37m packages were delivered, which was “the most packages delivered in a single day in the organization’s more than 240 year history”.
US Postmaster General and CEO Megan J. Brennan commented: “Although we continue to win customers and grow our package business, these gains are not sufficient to offset continuing declines in our mail business, which is our main source of revenue and contribution.
“We will continue to do everything within our control to improve operating efficiencies, manage expenses, expand our use of technology and keep mail affordable, but these actions must be combined with regulatory and legislative changes.”
