postalnews blog

WASHINGTON, Nov. 15 — Record levels of revenue and volume
helped the U.S. Postal Service conclude its 2006 fiscal year with net income of
$900 million, but increases in fuel and labor costs limited the overall
financial success.

The FY2006 year-end financial figures were released today by Chief Financial
Officer and Executive Vice President H. Glen Walker during the November meeting
of the Board of Governors. The Postal Service’s 2006 fiscal year began Oct. 1,
2005, and ended Sept. 30, 2006. Total revenue was $72.8 billion, and total
expenses were $71.9 billion. The net deficiency, after including a $3 billion
escrow allocation, as required by law, was $2.1 billion.

Fuel and transportation costs totaled approximately $1.7 billion in FY2006,
or $260 million more than anticipated, according to Walker. As one of the
nation’s largest transportation and delivery organizations, the Postal Service
is extremely sensitive to changing energy costs. Overall, total expenses
increased by 4.9% over the previous year.

Total mail volume increased in FY2006 by 1.4 billion pieces, or 0.7%. While
the mail volume decline trend continued for First-Class Mail (0.5% decrease from
the previous FY), Walker said growth in Standard and Priority Mail helped
increase overall mail volume to 213 billion pieces.

Walker also reported that the fiscal year ended with a record seventh
consecutive year in positive total factor productivity (TFP). The Postal Service
uses TFP to measure the change in the relationship between outputs, or workload,
and all the resources used in producing these outputs. Total Factor Productivity
increased by 0.4% in FY2006.