USPS Net Income $1.4 Billion Over BudgetThe U.S. Postal Service generated net income of $1.8 billion from Oct. 1 to May 31, according to financial and operating statements the agency released yesterday.
USPS net income was $1.4 billion over budget and revenue totaled $47.4 billion, which was $1.1 billion better than planned and up 1.5 percent from the year-ago period. Expenses of $45.5 billion were $221.4 million under plan but up 4 percent from the year-ago period.
Total year-to-date mail volume of 142.8 billion pieces was a 3 percent rise from the year-ago period. The most significant volume increase was in Standard, which jumped 6.1 percent. The category with the next-largest increase was Priority Mail, up 4.2 percent.
Other categories producing volume increases in the period included Package Services (2.2 percent), Express Mail (1.6 percent), First Class (0.2 percent) and Periodicals (0.1 percent). The International category declined 0.4 percent.
Meanwhile, a USPS attorney filed a response June 17 to an interrogatory from the Office of the Consumer Advocate. An interrogatory is a formal or written question, or series of questions, that must be answered under oath during the discovery process.
The OCA filed the interrogatory June 16 after reading a statement posted on the Association of Postal Commerce's Web site (www.postcom.org) that said: "Word has it that the Postal Service is sitting on a whale of a lot more cash than it originally disclosed to the Postal Rate Commission. If this is true, look for an errata to be filed at the PRC."
An errata is a list of errors and their corrections or additions to something that already has been printed.
The USPS filed a rate case with the PRC in April seeking an expedited recommended decision to raise rates and fees 5.4 percent for virtually all mail categories, to be implemented early next year. In previous filings sent to the PRC regarding the case, the OCA suggested that the USPS does not need to raise rates 5.4 percent because of its positive financial situation. The OCA is part of the commission.
In the interrogatory, the OCA asked the USPS, among other things, to state whether it has significantly more cash than originally was disclosed to the PRC and whether an errata will be filed at the commission reflecting a significant amount of cash in excess of originally filed estimates.
USPS attorney Scott L. Reiter said in his response: "[The] Postal Service does not have more cash than that reflected in the current filing and knows of no basis for the quoted statement on the Postcom Web site. In fact, the average cash balance estimated for May 2005 [$3.2 billion] was approximately $400 million more than the Postal Service's actual experience [$2.8 billion]."
Reiter also said no further errata on this matter would be filed.
Melissa Campanelli covers postal news, CRM and database marketing for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters