USPS June Financials Released
From USPS News Link:
Net deficiency of $594.5 million posted after escrow allocation
USPS revenues for June were $27 million, or 0.4% under plan and 5.6% more than June 2005. Expenses for the month were $39 million, or 0.7% under plan and 4.4% more than June 2005. The result is a net loss of $11.9 million before the escrow allocation. The net deficiency after escrow allocation is $261.9 million.
Year-to-date (YTD) revenue through June is 3.9% higher than the same period last year (SPLY) and is $386 million above plan. YTD expenses are 4.2% higher than SPLY and $222 million over plan. YTD total mail volume is 0.9% above SPLY.
YTD, net income before escrow allocation is $1.66 billion. However, our net deficiency after the escrow allocation is $594.5 million.
Contributing to the YTD performance was the new postage rate structure implemented Jan. 8, which provided a 5.4% revenue increase needed to fulfill the requirement of Public Law 108-18, The Postal Civil Service Retirement System (CSRS) Funding Act, enacted in 2003. This law requires the Postal Service to hold $3 billion in an escrow account by Sept. 30, 2006, to cover the difference between the CSRS retirement costs before and after the implementation of this law. We are allocating $250 million per month for purposes of assessing our financial position.
Full results are posted on USPS.com at http://www.usps.com/financials/fos/welcome.htm.
From the USPS notes attached to the June data (page numbers refer to the Excel version):
Information: For the month, there were the same number of delivery days and business weekdays when compared to same period last year (SPLY). Year-to-date (YTD), there are an equal number of delivery days and business days compared to last year.
Analysis of the Financial and Operating Statements
Revenue - Pages 1, 2, 3, 4, 5 and 6
For June, Total Revenue was $27 million or 0.4% under plan, and $312 million or 5.6% over same period last year (SPLY). Commercial Revenue was under plan by $33 million or 0.7% and Retail Revenue was over plan $17 million or 1.2%. In June, Total Commercial Revenue and Retail Revenue, combined, were $306 million more than SPLY. Most of the increase in revenue to SPLY for June was reflected in Presort First Class and Package Services/Permit Imprint and Permit Imprint. Combined these revenue sources were $116 million more than SPLY.
Year-to-date, Total Revenue is $386 million or 0.7% over plan with the largest contributor being Retail Revenue at $537 million or 4.1% more than plan. Year-to-date, Total Revenue is $2.1 billion over SPLY. Primary contributors to the increase over SPLY are Permit Revenue at $1.6 billion more and Other Retail Channels Revenue at $0.7 billion more than SPLY.
Expenses - Pages 1, 2, 4, 7, 8 and 9
For June, Total Expenses were $39 million under plan. Personnel costs were $2.3 million under plan and non-personnel costs were under plan by $29 million or 2.3%. Compared to SPLY, this month’s Total Expenses were increased by $249 million or 4.4%. Factors contributing to this increase over SPLY include vehicle maintenance and hire costs, communications, increased fuel prices, health benefits, other personnel compensation and COLA costs.
Year-to-date, Total Expenses were $222 million or 0.4% above plan. Personnel costs are $388 million or 0.9% above plan while non-personnel expenses are $128 million or 1.1% below plan. The largest contributors to the non-personnel plan underrun are Information Technology at $125 million or 32.3% below plan and Training at $17 million or 31% below plan. Year-to-date, Total Expenses are $2.1 billion or 4.2% above SPLY.
Mail Volume and Revenue - Page 3
Total Mail Volume for Quarter 3, FY 2006 was 1.2 billion pieces or 2.3% above same period last year (SPLY). Most of this quarter’s increase in mail volume above Quarter 3, FY 2005 levels occurred in Standard Mail, 699 million pieces or 2.9% above, and First-Class Mail, 276 million pieces or 1.2% above.
Year-to-date, Total Mail Volume is 0.9% or 1.5 billion pieces over SPLY. The most significant mail volume increase over SPLY, year-to-date, is in Standard Mail, which increased 1.5 billion pieces or 2.0%. Year-to-date, First-Class Mail volume is 0.4% less than SPLY generating $643 million or 2.3% more revenue than SPLY.
Capital Investments - Pages 1 and 13
The Fiscal Year 2006 Capital Commitments, year-to-date, through June 2006 are $952 million compared to a plan of $1 billion. This represents a plan underrun of about $66 million or 6.5%.
The Cash Outlays, year-to-date, are $1.7 billion versus a plan of $1.6 billion.
Workhours - Pages 1, 14 and 15
Total Workhours for June 2006 were 0.8 million hours or 0.7% above plan. This month’s workhours usage was slightly below that of June 2005. Rural Delivery increased 0.6 million hours over SPLY.
Year-to-date, Total Workhours for June 2006 are 16.1 million hours or 1.5% above plan, and 2.3 million hours or 0.2% below SPLY. The most significant plan overruns lie in Mail Processing by 9.0 million hours, Delivery Services by 4.7 million hours, and Customer Services by 4.4 million hours. These overruns in workhours are a reflection of growth in volume above plan and continued growth in delivery points. Year-to-date, major contributors to the workhours decrease in SPLY are City Delivery and Mail Processing workhours. Combined workhours in these operations are 3.8 million hours below SPLY.