The US Postal Service filed its unaudited May financial results late yesterday, showing a loss of $1.3 billion for the month, most of it caused by Congressionally mandated “trust fund” payments and non-cash adjustments to the future value of workers comp liabilities. (Note: although the PMG has said the the USPS will be unable to actually hand over the trust fund payment in September, it still needs to recognize it as a monthly debit on its balance sheet).
Without Congress’s mandates, the USPS would show a loss for the month of $434 million, and for the year to date, $589 million. Without those mandates, the USPS would also be virtually debt free- but that would remove the “need” to place the service in receivership, as proposed by Republicans in Congress.
Looking at the real operational numbers, the picture is hardly rosy. First class mail volume continues to run at about 7% below the same period last year (SPLY). After 8 months of the current fiscal year, the USPS has processed 3.7 billion fewer first class pieces than in SPLY. That represents a revenue drop of $1.6 billion. While standard mail volume is 4.3% above SPLY YTD, that produces a revenue increase of just $426 million.
Bottom line revenue year to date is now $44.7 billion, down from $46 billion at this point last year. Meanwhile total expenses (including Congress’s mandates) are $49.4 billion, up slightly from a year ago.
The USPS has managed to lower employee workhours to match the decline in revenue- both are down 2.8% year to date. But that hasn’t translated to a equivalent drop in total expenses, which actually rose by 1%. Salaries and benefits are down only slightly (-0.8% YTD), while non-personnel costs jumped 4.7%, largely driven by higher fuel costs.