USPS Ends Fiscal Year With $5.1 Billion Loss
On Tuesday, the United States Postal Service announced the end of its 2011 fiscal year with a loss of $5.1 billion. Declining mail volume, particularly First Class mail, was attributed as the primary reason for the loss, despite increased revenue in other areas.
Overall mail volume decreased by 3 billion pieces from 2010, with first class mail declining 5.8 percent, or $2 billion, to $32.2 billion for the year. Other services, such as Priority Mail and Standard Mail, saw revenue increases of 2.6 to 6.3 percent respectively; actual revenue from these services, $530 million and $495 million, was still well below the losses in other categories.
The USPS said that the loss would have been much larger had the government not intervened. Fiscal year 2011, which ended on Sept. 30, was projected to have a $10.6 billion loss until the White House endorsed a plan to restructure the Postal Service days before the deadline. Part of that plan allowed the USPS to postpone payment of $5.5 billion toward a retiree benefit fund; unless Congress enacts further legislation, that payment will become due on Friday, Nov. 18. The USPS has stated it would default on that payment.
"The Postal Service can become profitable again if Congress passes comprehensive legislation to provide us with a more flexible business model so we can respond better to a changing marketplace," said Postmaster General and CEO Patrick Donahoe in a press release. "To return to profitability we must reduce our annual costs by $20 billion by the end of 2015."
"We continue to take aggressive cost-cutting actions in areas under our control and urgently need Congress to do its part to get us the rest of the way there," Donahoe said.
A copy of the full release and financial figures is available on the Postal Service's website.