US Postal Service concludes fiscal year 2008 with net loss
US Postal Service records a USD 2.8bn loss on revenue of USD 75bn.
The U.S. Postal Service concluded the 2008 fiscal year ending 30 September 2008 with a net loss of USD 2.8bn as the national economic slowdown lowered mail volume and as the Postal Service bore additional costs mandated by the Postal Act of 2006. The loss occurred despite more than USD 2bn in cost-cutting measures that included the use of 50 million fewer work hours compared to the previous year. The Postal Service continued to improve national on-time First-Class Mail delivery performance, reaching record highs in 2008.
Mail volume in FY 2008 totaled 202.7 billion pieces, a decline of 9.5 billion pieces, or 4.5 pct, compared to the previous fiscal year. Declining mail volume was a symptom of the worsening national economy, particularly related to the financial and housing industries and to trends toward the use of electronic mail.
Total revenue in FY 2008 was USD 75bn, unchanged from last year. Expenses totaled USD 77.8bn, including the USD 5.6bn payment required by the Postal Act of 2006 to pre-fund retiree health benefits. Excluding all the retiree health benefit fund payments from 2008 and 2007, expenses were up less than 1 pct over last year. Cost reductions offset nearly all of the impact from rising inflation, of which the major contributors were a USD 562m increase in cost of living adjustments paid to craft employees and USD 525m in additional fuel costs.
In the fourth quarter of 2008, on-time delivery performance for overnight First-Class Mail service remained at 97 pct for the second consecutive quarter, one point above the same period last year. Two-day service was 94% on-time and three-day service was 93 pct on-time, unchanged from the fourth quarter of the previous year.
