USPS Losses Continue, Default on Federal Payments Looming
Major elements of the third quarter financial results include:
- Total mail volume of 39.8 billion pieces, compared to 40.9 billion pieces in the same period a year earlier, a decrease of 2.6 percent, led by a drop in First-Class Mail; and
- Operating revenue of $15.8 billion, compared to $16.0 billion in the same period a year earlier, a decrease of 1.7 percent.
Mailing Services revenue of $13.6 billion decreased $429 million, or 3.1 percent, in the third quarter of 2011, compared to the same period a year ago. Mailing Services volume of 39.5 billion pieces represents a 2.7 percent decline from the same period a year earlier.
Mailing Services results in the third quarter include:
- First-Class Mail revenue of $7.8 billion, on volume of 17.7 billion pieces;
- Standard Mail revenue of $4.2 billion, on volume of 19.8 billion pieces;
- Periodicals revenue of $454 million, on volume of 1.8 billion pieces; and
- Package Services revenue of $354 million, on volume of 143 million pieces.
Shipping Services revenue of $2.2 billion represents an increase of $150 million or 7.3 percent compared to the same period a year ago. Shipping Services volume of 359 million pieces represented a 5.9 percent increase compared to the same period a year earlier.
Electronic diversion continues to cause reductions in First-Class Mail. For the third quarter, single-piece First-Class letter revenue declined $259 million or 8.7 percent, while Periodicals revenue decreased 3.0 percent compared to the same period a year earlier.
“Since the passage of the Postal Accountability and Enhancement Act of 2006 (PAEA), the Postal Service has contributed more than $37 billion to a trust fund for future retiree health benefits,” noted Joseph Corbett, CFO and executive vice president. “We are experiencing a severe cash crisis and are unable to continue to maintain the aggressive prepayment schedule that was mandated in the PAEA. Without changes in the law, the Postal Service will be unable to make the $5.5 billion mandated prepayment due in September.”