USPS: Standard Strong Despite October Slip

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Standard mail remains a leading growth category for the U.S. Postal Service, officials said last week, despite operating statements showing that Standard saw the largest decrease of all mail categories in October.


For the first month of the postal service's fiscal 2006 (covering Oct. 1-31, 2005), Standard mail volume of 9.65 billion pieces was down 4.5 percent versus the first month of fiscal 2005 (Oct. 1-31, 2004), when volume reached 10.1 billion.


That drop is an anomaly, USPS spokesman Jim Quirk said, because "last year was an election year, so there was a lot of campaign mail surrounding that." Standard mail is still strong, he added, "and we expect it to continue to be strong."


The decrease was surprising given that from Oct. 1, 2004, to Aug. 31, 2005, the most significant volume increase was in Standard mail, which jumped 5.9 percent. And for fiscal year 2005, Standard mail volume exceeded First Class for the first time in history.


Overall, October 2005 mail volume of 18.8 billion pieces was a 3.5 percent decrease from 19.5 billion in October 2004. Volume also dipped for First Class, 3.5 percent; and Package Services, 0.5 percent. Categories that saw increases include International Mail, 6.5 percent; Priority Mail, 5.5 percent; Express Mail, 4.8 percent; and Periodicals, 2.6 percent.


The USPS generated net income of $276.6 million from Oct. 1 to Oct. 31, which was $144.4 million under forecast. These numbers, however, refer to net income before an escrow allocation of $250 million. With the allocation, net income dropped to $26.6 million. This is the first time the USPS financial statements reflected the escrow payment issue.


According to the statements, the Postal Civil Service Retirement System Funding Reform Act of 2003 requires that the postal service hold an amount in escrow equal to the difference between the CSRS retirement costs before and after the implementation of the law.


Total revenue was $5.99 billion, which was $198.1 million under plan. Total expenses of $5.71 billion were $53.7 million under plan.


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


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