Record levels of revenue and volume helped the U.S. Postal Service conclude its 2006 fiscal year with net income of $900 million, but increases in fuel and labor costs limited the financial success.
The FY 2006 year-end financial figures were released Nov. 15 by H. Glen Walker, USPS chief financial officer and executive vice president, during the November meeting of the Board of Governors in Washington.
The postal service’s 2006 fiscal year covered Oct. 1, 2005, to Sept. 30. Total revenue was $72.8 billion, up 4.0 percent, while total expenses rose 4.9 percent from the previous year to $71.9 billion. The net deficiency, after including a $3 billion escrow allocation as required by law, was $2.1 billion.
Fuel and transportation costs totaled about $1.7 billion in FY 2006, or $260 million more than anticipated, Mr. Walker said. As one of the nation’s largest transportation and delivery organizations, the USPS is sensitive to changing energy costs.
Total mail volume increased in FY 2006 by 1.4 billion pieces, or 0.7 percent. Though the volume decline trend continued for First Class Mail (down 0.5 percent from the previous FY), Mr. Walker said growth in Standard and Priority Mail helped increase overall mail volume to 213 billion pieces. Standard Mail totaled 102.5 billion pieces compared with 97.6 billion for First Class.
Mr. Walker also reported a record seventh consecutive year of positive total factor productivity. The USPS uses TFP to measure the change in the relationship between workload and the resources used in producing that workload. TFP increased 0.4 percent in FY 2006.