Just when you’re getting used to one phony number, another comes along! We covered the famous “$25 million a day!” loss figure back in April, pointing out that almost all of it was from the arbitrary PAEA trust fund charges, and that postal operations accounted for just 8/10ths of one percent of the “loss”. We also pointed out that the 99.2% caused by PAEA was strictly a paper loss- an accounting entry, not actual money that the USPS had “lost”.

Now the Associated Press features a story on today’s financial results that appears to have been written by a summer intern with a calculator:

The nearly bankrupt U.S. Postal Service on Thursday reported losses of $57 million per day in the last quarter and warned it will miss another payment due to the U.S. Treasury, just one week after its first-ever default on a payment for future retiree health benefits.

From April to June, losses totaled $5.2 billion, up $2.1 billion from the same period last year.

Notice that the author seems to be blissfully unaware of the fact that most of the amazing “$57 million per day” loss is the same money as the two “defaults” mentioned in the story. And, as we pointed out this morning, some of the “$57 million per day” “loss” was also included in last year’s “$25 million per day” “loss”. And needless to say, the writer never mentions that the majority of the “loss” is just an entry in a spreadsheet, not real money…

Do they still have editors at the AP?

via The Associated Press: Postal Service reports $5.2B loss in 3rd quarter.

Update: for a well written, comprehensive analysis of the USPS financial report, check out this story at Federal News Radio.

From USPS News Link:

For the second consecutive quarter, service performance and customer experience measurement (CEM) scores have improved.

The Postal Service had its best quarter on record for overnight, 2-day and 3- to 5-day First-Class Mail delivery. And service scores for presorted commercial mail exceeded targets in all three service standards.

In a presentation to the USPS Board of Governors, Chief Operations Officer Megan Brennan reported that the combined performance score for overnight First-Class Mail (97.1 percent) exceeded the target of 96.7 percent and also beat the performance established at the same point during the previous fiscal year. Similarly, service performance scores for 2-day and 3- to 5-day deliveries consistently exceeded targets and improved on scores from a year ago.

Brennan said overall CEM scores also showed improvement over the same period in 2011. The third quarter score for residential customers improved to 88.7 percent, more than 1.5 points higher than a year ago. And more than 84 percent of small and medium business customers surveyed expressed appreciation for the service they received from employees, exceeding levels reported for the same period last year.

Brennan’s report came on the same day Acting Chief Financial Officer Steve Masse announced a continuing decline in First-Class Mail volume and overall revenue. But Brennan, Masse and other members of the USPS leadership emphasized the important contributions employees are making to point the Postal Service in a positive direction.

“We are going through significant consolidations and changes to the way we do business,” said Board of Governors Chairman Thurgood Marshall Jr. “Even in the midst of these changes, our employees have demonstrated their commitment to performance, to customers and to delivering excellent service.”

PMG Pat Donahoe said that in spite of negative financial news, “We will continue to deliver the mail, we will pay our employees and pay our suppliers.” He added the Postal Service’s financial problems are the result of an “inflexible business model” that action by Congress can improve.

Congressional action is part of the Postal Service’s 5-year comprehensive business plan, which also includes steps USPS has the flexibility to pursue on its own. USPS already is implementing a new operating model for rural Post Offices, as well as consolidation of network facilities and delivery units. The plan also addresses revenue growth, such as the increase in shipping services and the growth of Every Door Direct Mail.

Donahoe said that even during challenging times, employees take pride in their service mission and that he’s grateful for their efforts. “We never forget for a moment that their commitment and hard work make the whole organization function every day,” he said.

Click herefor more information on today’s Third Quarter Financial report.

August 9, 2012 — Today’s figures reflect the congressional role in the Postal Service’s red ink and the need for Congress to address the damage it has done. The USPS reported that $3.1 billion of the $5.2 billion loss resulted from the 2006 congressional mandate that the Postal Service – alone among all agencies and companies – pre-fund future retiree health benefits 75 years into the future. In the first three quarters of this fiscal year, that mandate accounts for $9.3 billion of the $11.7 billion in USPS red ink, or 80 percent.

Overall, since pre-funding went into effect in 2007, it accounts for 83 percent of the Postal Service’s losses. That means that only 17 percent of all the red ink stems from actual mail operations, including the decline in first-class mail.

The irony of Congress continuing to insist on pre-funding is that the Postal Service already has $45 billion in its future retiree health benefits fund, more than any company in America and enough for decades into the future.

The positive aspects to today’s USPS report are the continuing sharp rises in revenue from package deliveries associated with Internet orders and also in productivity. If Congress would step up and fix the pre-funding mess it created, then the Postal Service could focus on developing a business plan for the future that would meet the challenges of an evolving society while taking advantage of opportunities such as e-commerce. Degrading services and dismantling the universal network are not a business plan.

via Statement on USPS FY2012 Q3 Financial Report.

Postcom reports from today’s USPS Board of Governors meeting:

The Postal Service ended its third fiscal quarter (April 1 – June 30) with a net loss of $5.2 billion, compared to a net loss of $3.1 billion for the same period last year. Contributing significantly to the quarter’s $5.2 billion loss was $3.1 billion of expense for the legislatively mandated prefunding of retiree health benefits. These expenses along with the continued decline of First-Class Mail volume, more than offset the quarter’s 9 percent growth in revenue from Shipping Services and package delivery. Despite continued success in generating new package delivery revenue, improving efficiency and reducing costs, large losses are expected to continue until legislative changes are made in line with the Postal Service Business Plan to return to financial stability.

Two things to note about this massive “loss”.

1. Most of the “loss”, the $3.1 billion pre-funding expense, doesn’t reflect actual money the USPS has paid out, but rather, three months worth of PAEA trust fund payments that the USPS has already said it won’t be making.
2. Last year’s Q3 “loss” of $3.1 billion included $1.4 billion worth of last years trust fund payment, which was never made. Congress rolled that payment over to 2012, so the same $1.4 billion that was shown on the Q3 2011 books, but never actually paid, has also been added to this year’s “loss”.

And of course, there’s the matter of the $56.3 billion the USPS has “in the bank”- $45.3 billion already in the PAEA trust fund, and $11 billion in verified FERS overpayments. (Can you think of another company supposedly “teetering” on the brink of bankruptcy that has $56 billion in the bank?)

Isn’t it amazing what you can come up with when you combine postal bookkeeping and Congressional accounting?

Here is the USPS press release on the results: