USPS reports double-digit revenue and volume growth in Shipping and Packages in 2016 amid net loss of $5.6bn


For the fiscal year ended September 30, 2016, the United States Postal Service (USPS) reported a net loss of $5.6bn due largely to mandated retiree health benefits expenses. Excluding this “prefunding obligation”, net income would have been around $200m.

Overall revenues grew by 2.3% to $70.4bn in 2016, excluding a $1.1bn impact due to accounting method changes. Revenue growth was achieved despite the April 2016 expiration of the “exigent surcharge” mandated by the Postal Regulatory Commission. As a result, the USPS asserts that revenue for 2016 was lower by approximately $1bn than it otherwise would have been. Furthermore, going forward without the surcharge, the USPS expects its revenue to decline from what it otherwise would be by almost $2bn per year.

Parcel volumes driven by the trend towards e-commerce continue to be a boon for the USPS. The Shipping and Packages division had volume and revenue growth of 13.8% and 15.8% respectively. These gains were offset by a decline in First-Class Mail revenue of $925m, or 3.3%, due largely to the exigent surcharge expiration and continuing electronic migration. Together with steady standard mail and advertising mail revenues in addition to a slight increase in other revenues, the USPS achieved revenue growth of $1.6bn.

“The Postal Service continues to win e-commerce customers and grow our package delivery business. We deliver more e-commerce packages to the home than any other shipper because of our predictable service, enhanced visibility and competitive pricing,” said Postmaster General and CEO Megan J. Brennan.

If this news article has been of interest you might also like to download Ti’s analysis and market overview of the global express and small parcels industry. Ti’s annual report includes insight into what factors are shaping the market as we know it. It also contains Ti’s unique market sizing and forecast data, as well as company profiles of post offices, LSPs and the integrators to showcase their differing strategies as the market develops.

Source: United States Postal Service

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