Postal Service reports $592M January loss
The US Postal Service saw a net loss of $592 million for January, and a total loss of $890 million for the first four months of its 2010 fiscal year, according to preliminary financial data released by the Postal Regulatory Commission on March 3. The data was made public one day after the USPS revealed its 10-year financial recovery plan.
In January, the USPS' mail volume was 13.9 billion pieces. For the first four months of the 2010 fiscal year, the agency mailed 59.7 billion pieces.
The Postal Service earned a profit of $179 million for December 2009, but lost $297 million during its fiscal first quarter, which ran from October 1 to the end of last year. It lost $255 million for November 2009.
The PRC made the data public one day after the Postal Service released its financial recovery plan, which includes cost-cutting measures, new products and services and regulatory reform. The USPS will also ask Congress to allow it to cut home delivery on Saturdays and to enact an exigent price increase exceeding its inflation-based price cap in 2011. The USPS is also considering the closure of 162 branches.
The PRC said March 2 that it will review the Postal Service's pension payment system. The USPS' inspector general contends that the current funding system forced the agency to overpay by $75 billion from 1975 to 2009.
Yvonne Yoerger, spokeswoman for the USPS, said that the agency expects to run a net loss for the year in the billions. She added that the Postal Service used fewer work hours than it planned for during the period. The agency aims to reduce work hours by 93 million this fiscal year, she said.
On March 2, Joseph Corbett, EVP and CFO of the US Postal Service, told DMNews that the USPS needs “fundamental changes in the way we operate.”
“We just completed a comprehensive study with three consulting firms and have concluded that that we stand to lose as much as $240 billion over the next decade if we continue business as usual,” he said.