- USPS Ground Advantage leads Shipping and Package
growth
- Reductions in transportation expenses reflect continued
progress under the Delivering for America
plan
- Operating revenue increase of $410
million to $19.7
billion
WASHINGTON, May 9, 2024
/PRNewswire/ -- The U.S. Postal Service today announced its
financial results for the second quarter of fiscal year 2024
(Jan. 1, 2024 - Mar. 31, 2024). The net loss for the quarter
under generally accepted accounting principles (GAAP) totaled
$1.5 billion, compared to a net loss
of $2.5 billion for the same quarter
last year. GAAP results for the quarter were negatively impacted by
$1.4 billion of expenses
attributed to the amortization of unfunded retiree pension
liabilities, offset by a workers' compensation non-cash benefit of
$224 million driven by actuarial
revaluation and discount rate changes; these factors are not
controllable by the Postal Service. Controllable loss, as defined
below, for the quarter was $317
million, compared to a controllable loss of $498 million for the same quarter last year.
These results were favorably impacted by increased revenue and
lower transportation costs, partially offset by the continued
effect of inflation on operating expenses.
Total operating revenue was $19.7
billion for the quarter, an increase of $410 million, or 2.1 percent, compared to the
same quarter last year.
Revenue for the overall Shipping and Packages category increased
$89 million, or 1.2 percent, on a
volume increase of 25 million pieces, or 1.5 percent, compared to
the same quarter last year. USPS Ground Advantage, the
Postal Service's shipping offering which provides a simple,
reliable, and more affordable way to ship packages, has continued
to experience wide adoption in the marketplace.
First-Class Mail revenue increased $280
million, or 4.4 percent, on a volume decline of 261 million
pieces, or 2.2 percent, compared to the same quarter last year.
Marketing Mail revenue increased $74
million, or 2.1 percent, on a volume decline of 282 million
pieces, or 2.0 percent, compared to the same quarter last year.
"Our financial results this quarter demonstrated positive trends
regarding improved revenue generation and cost control. This
reflected progress in the implementation of our 10-year
transformation and modernization plan," said Postmaster General
Louis DeJoy. "We also saw gains in
package deliveries through our successful USPS Ground
Advantage offering, which was enabled by our new operating
model. As we continue to modernize our processing, transportation,
and delivery functions, we will increasingly operate with greater
efficiency and capability, and at a consistently higher level of
performance."
Total operating expenses were $21.3
billion for the quarter, a decrease of $685 million, or 3.1 percent, compared to the
same quarter last year, reflecting our cost control efforts over
transportation expenses and work hours.
"The second quarter saw continued growth in package revenues,
which along with lower transportation expenses, favorably impacted
our business," said Chief Financial Officer Joseph Corbett. "Inflation, and higher mandated
retirement benefit costs, continue to offset these positive
efforts. We continue to manage the costs within our control,
working toward financial stability for our organization through the
full implementation of the Delivering for America plan."
Second Quarter Fiscal Year 2024 Operating Revenue and
Volume by Service Category Compared to Prior Year
The following table presents revenue and volume by service
category for the three months ended March
31, 2024 and 2023:
|
Revenue
|
|
Volume
|
(revenue in $
millions; volume in millions of pieces)
|
2024
|
|
2023
|
|
2024
|
|
2023
|
Service
Category
|
|
|
|
|
|
|
|
First-Class
Mail
|
$
6,590
|
|
$
6,310
|
|
11,678
|
|
11,939
|
Marketing
Mail
|
3,653
|
|
3,579
|
|
13,814
|
|
14,096
|
Shipping and
Packages
|
7,711
|
|
7,622
|
|
1,714
|
|
1,689
|
International
|
366
|
|
400
|
|
75
|
|
82
|
Periodicals
|
221
|
|
226
|
|
671
|
|
737
|
Other
|
1,171
|
|
1,165
|
|
59
|
|
67
|
Total operating
revenue and volume
|
$
19,712
|
|
$
19,302
|
|
28,011
|
|
28,610
|
Selected Second Quarter Fiscal Year 2024 Results of
Operations and Non-GAAP Measures
This news release includes controllable loss which is not
calculated and presented in accordance with GAAP. This non-GAAP
measure is calculated as net loss adjusted for costs outside of
management's control, including workers' compensation expenses
caused by actuarial revaluation and discount rate changes and the
amortization of the CSRS and FERS unfunded liabilities. These
latter costs not only are largely outside of management's control
but also can fluctuate significantly based on actuarial assumptions
and interest rates.
This non-GAAP measure provides meaningful information to assist
users of the Postal Service's financial statements to more fully
understand the financial results and assess the Postal Service's
ongoing performance because it excludes items that may not be
indicative of, or are unrelated to, underlying operations.
Non-GAAP financial measures should be considered in addition to,
and not as an alternative for, the Postal Service's reported
results prepared in accordance with GAAP. This adjusted financial
information does not represent a comprehensive basis of
accounting.
The following table reconciles GAAP net loss to our non-GAAP
financial measure for the three months ended March 31, 2024 and 2023:
(results in $
millions)
|
2024
|
|
2023
|
Net
loss
|
$
(1,468)
|
|
$
(2,480)
|
Workers' compensation
non-cash (benefit) expense1
|
(224)
|
|
732
|
CSRS unfunded
liability amortization expense2
|
800
|
|
775
|
FERS unfunded
liability amortization expense3
|
575
|
|
475
|
Controllable
loss
|
$
(317)
|
|
$
(498)
|
|
1
Represents workers' compensation non-cash
(benefit) expense resulting from fluctuations in discount rates,
changes in assumptions, valuation of new claims, revaluation of
existing claims, and the administrative fee paid to the U.S.
Department of Labor, less current year claim payments.
|
2
Expense for the accrual for the annual
payments due to the Office of Personnel Management (OPM) by
September 30 of the respective fiscal year, to amortize the
unfunded CSRS retirement obligation. Payments are to be made
through 2043 based on OPM invoices.
|
3
Expense for the accrual for the annual
payment due to OPM by September 30 of the respective fiscal year,
to amortize the unfunded FERS retirement obligation. Payments are
to be made over a 30-year rolling period based on OPM
invoices.
|
Financial results in the Form 10-Q are available at
http://about.usps.com/what/financials/.
Forward-Looking Statements
Forward-looking statements
contained in this release represent the Postal Service's best
estimates of known and anticipated trends believed relevant to
future operations. However, actual results may differ significantly
from current estimates. Certain forward-looking statements included
in this release use such words as "may," "will," "could," "expect,"
"believe," "plan," "estimate," "project," or other similar
terminology. These forward-looking statements, which involve a
number of risks and uncertainties, reflect current expectations
regarding future events and operating performance as of the date of
this report. The Postal Service has no obligation to publicly
update or revise any forward-looking statements, whether as a
result of new information, future events, or otherwise.
The United States Postal Service is an independent federal
establishment, mandated to be self-financing and to serve every
American community through the affordable, reliable and secure
delivery of mail and packages to nearly 167 million addresses six
and often seven days a week. Overseen by a bipartisan Board of
Governors, the Postal Service is implementing a 10-year
transformation plan, Delivering for America, to
modernize the postal network, restore long-term financial
sustainability, dramatically improve service across all mail and
shipping categories, and maintain the organization as one of
America's most valued and trusted brands.
The Postal Service generally receives no tax dollars for
operating expenses and relies on the sale of postage, products and
services to fund its operations.
For USPS media resources, including broadcast-quality video and
audio and photo stills, visit the USPS Newsroom. Follow us
on X, formerly known as
Twitter; Instagram; Pinterest; Threads and
LinkedIn. Subscribe to the USPS YouTube
Channel and like us on Facebook. For more
information about the Postal Service, visit
usps.com and facts.usps.com.
Contact: Martha Johnson
martha.s.johnson@usps.gov
usps.com/news
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SOURCE U.S. Postal Service