The Low Post News

Post Office Registers $1.9 Billion Loss during Second Quarter

The U.S. Postal Service completed its second quarter registering a $1.9 billion net loss as volumes of first class mail continued tumbling. The U.S. government could not provide any relief, the agency announced Friday.

The net loss for the agency’s fiscal second quarter that ended on March 31 surpassed the loss of the first quarter of $354 million. However, it remained flat compared to the same quarter one year ago. Over the past 22 quarters, the agency has reported there have been 20 ending in a loss, said the USPS.

The product that was most profitable for the Postal Service, its first class mail, dropped by 4.1% during the second quarter due to more Americans opting to make communication and to pay bills on the Internet.

Liabilities that totaled $64 billion surpassed the $42 billion in current assets, adding to the agency’s dire situation financially, said the agency in a prepared statement.

At the same time, its packaging and shipping business remained positive. The agency has leveraged the growth in its e-commerce, and saw its packaging and shipping volumes increase over 7.3%, as more users shopped online and were in needed of carriers to make deliveries of their goods.

The U.S. Postal Service has struggled under the heavy weight of the mandatory payments for its future retirees’ health fund that became a requirement by the U.S. Congress since 2006.

The mail carrier sought relief from Congress to allow modernization of its different business services it offers, restructuring its payments for retirees and shifting to a mail delivery service of just five days by eliminating deliveries on Saturday.

As the U.S. public becomes more and more accustomed to using the Internet for making purchases, making payments and conducting business, the Postal Service is expecting its first class mail volumes to continue to drop.

The volume of first class mail is expected 4 billion fewer overall pieces for the 2014 fiscal year. The agency does not have the money to make an upgrade to its vehicles that are now 23-years old.

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