The net losses at the Postal Service grew by leaps and bounds in fiscal year 2019 according to the agency’s latest financial results.
The net loss for the year was $8.8 billion, an increase in net loss of $4.9 billion (roughly 125%) over 2018 in which it lost $3.9 billion. 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.
The “controllable loss” for the year was $3.4 billion, an increase of $1.5 billion compared to the prior year. These are expenses management considers to be under its control.
“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.”
Postmaster General Megan J. Brennan, who has announced her retirement from the agency effective at the end of January 2020, commented on the figures as well.
“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 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.”
Some Bright Spots in the Figures
The Postal Service reported the other details as well in its FY 2019 financial figures. There was some good news; revenue from the Shipping and Packages business increased by $1.3 billion (6.1%) over FY 2018. This helped to offset declines in its First-Class and Marketing Mail businesses. First-Class Mail was down by 1.8 billion pieces (3.1%) and Marketing Mail was down 1.6 billion pieces (2.1%).
Also, total operating revenue was up over 2018 by $514 million. It was driven primarily by the growth from Shipping and Packages and price increases. Package volume grew slightly at 16 million pieces (0.3%).
The Postal Service also intends to raise prices in its parcel shipping business by about 3% starting Jan. 26, 2020 in an effort to provide the agency with needed revenue.
