U.S. Postal Service Reports Controllable Loss of $3.4 billion for FY 2019 | PostalReporter.com
t

U.S. Postal Service Reports Controllable Loss of $3.4 billion for FY 2019

Posted on by postal
  • Operating revenue increase of $514 million
  • Overall volume decline of 3.8 billion pieces
  • Urgent need to advance legislative and regulatory reforms, along with continued aggressive management and innovation

WASHINGTON – The U.S. Postal Service reported operating revenue of $71.1 billion for fiscal year 2019 (October 1, 2018 – September 30, 2019), an increase of $514 million compared to the prior year. The higher revenues were driven largely by price increases and continued growth in the Shipping and Packages business, where revenue increased $1.3 billion, or 6.1 percent, which more than offset revenue declines in First-Class and Marketing Mail as a result of declining volumes in that segment of its business.

The total volume of mail and packages delivered during the year declined by 3.8 billion pieces or 2.6 percent, driven largely by First-Class Mail declines of 1.8 billion pieces, or 3.1 percent, and Marketing Mail declines of 1.6 billion pieces, or 2.1 percent. Package volume grew slightly at 16 million pieces, or 0.3 percent, continuing a multi-year trend of declining mail volumes and increasing package volumes, although package volume growth slowed considerably during the year.

“We continue to adjust to declining mail volume and remain focused on leveraging our unique and unrivaled network to gain new customers and grow profitable revenue in the increasingly competitive package business,” said Postmaster General and CEO Megan J. Brennan.

“However, revenue growth in our package business will never be enough to offset imbalances in the Postal Service’s business model, which must be addressed through legislative and regulatory reforms in order to secure a sustainable future,” Brennan emphasized.

Operating expenses for the year were $79.9 billion, an increase of $5.4 billion, or 7.3 percent, compared to the prior year. This was driven by an increase in workers compensation expense of $3.5 billion, of which $3.4 billion was directly the result of changes in discount rates outside of management’s control.

Compensation and benefits expenses increased by $994 million due to contractual wage increases, and retirement benefits expenses increased by $320 million due largely to the higher amortization costs of unfunded benefits. Transportation expenses increased by $323 million as the Postal Service continued to experience increases in fuel prices and highway contract rates.

As planned, the Postal Service reduced its debt level during 2019 by $2.2 billion, finishing the year with $11.0 billion in debt outstanding. This reduction allows the Postal Service to continue to reduce interest costs.

Controllable loss for the year was $3.4 billion, an increase of $1.5 billion compared to the prior year. The net loss for the year was $8.8 billion, an increase in net loss of $4.9 billion compared to 2018. Approximately $3.4 billion of this increase in net loss was the non-cash impact of discount rate changes on actuarial calculations affecting workers’ compensation expense.

“We continued to make progress in the fiscal year in containing expenses that are under management’s control,” said Chief Financial Officer and Executive Vice President Joseph Corbett. “However, actions within the control of the Postal Service are not enough to return the Postal Service to financial health.”

FY 2019 Operating Revenue and Volume by Service Category Compared to Prior Year
The following presents revenue and volume by service category for the year ended September 30, 2019, and 2018:

Complete financial results are available in the Form 10-K, available at http://about.usps.com/who-we-are/financials/welcome.htm.

Financial Briefing
Postmaster General and Chief Executive Officer Megan J. Brennan and Chief Financial Officer and Executive Vice President Joseph Corbett will host a telephone/Web conference call to discuss the financial results in more detail. The call will begin at 11:30 am ET on November 14, 2019, and is open to news media and all other interested parties.

How to Participate:
US/Canada Attendee Dial-in: 844-340-4622   Conference ID: 4784052

Attendee Direct URL: https://usps.webex.com/usps/onstage/g.php?MTID=e69d71470912231e158a0fa994cc2da23

If you cannot join using the direct link above, please use the alternate logins below:
Alternate URL: https://usps.webex.com
Event Number: 824 136 345

The briefing will also be available on live audio webcast (listen only) at:
http://about.usps.com/news/electronic-press-kits/cfo/welcome.htm

2 thoughts on “U.S. Postal Service Reports Controllable Loss of $3.4 billion for FY 2019”

  1. Our great government should require every employer to prefund health care costs. If the idea is good enough for the postal service, then it’s good enough to require everyone else. Of course the idea is to strangle the postal service, the idea behind the law signed by ex President Forrest Gump. make the Army and Navy pre pay their health care costs!

  2. The Postal Service processes the packages that are delivered by Fed Ex, UPS and some Amazon. The Postal Service gets a share of their profit.
    The Postal Service is the only one with the machines capable of processing packages.
    In fact, before 2006 the did not know how much mail it was processing because packages, odd sized mail, magazines and periodicals could not be processed by the machines .
    Once the Postal Service had knowledge of the amount that was being processed and the amount that could be processed, they began to claim a loss…
    None of the no-bid, tax-free contracts that are let by the Postal Service have ever been monitored or audited.
    All contracts are offered to former associates of managers and Postmasters first!

Comments are closed.