WASHINGTON — The financially troubled Postal Service on Friday posted a net Loss of .9 Billion in the Second quarter, which ended March 31, compared with a $1.3 Billion Loss last quarter, when holiday shopping and heavy spending on political advertising during the 2012 election helped the agency.
Over all, the Postal Service reported operating revenues of $16.3 Billion in the Second quarter, an increase of $121 million, or 0.7 percent, which it attributed to strong growth in e-commerce deliveries and a small increase in standard mail, also known as junk mail.
But Postal officials said the service’s expenses of $18.2 billion, which included continuing debt, offset the modest increase in revenue. Joseph Corbett, the Postal Service’s chief financial officer, said it had nearly $50 Billion in debt obligations.
Officials said the Postal Service continues to lose $25 million dollars a day as it waits for Congress to pass legislation to overhaul the Postal system.
The Postal Service has struggled as mail volume has declined, which it continued to do in the Second quarter, to 38.8 Billion pieces, down from 39.4 Billion for the same period a year earlier, according to agency financial documents.
Revenue from first-class mail, which provides the bulk of the revenue for the Postal Service, declined $198 million, or 2.7 percent, from the same period the previous year, with a decrease in volume of 713 million pieces, or 4.1 percent.
There were a few bright spots in the gloomy financial report. Revenue from advertising mail increased $96 million, or 2.4 percent, in the Second Quarter compared with the same period a year earlier on a volume increase of 181 million pieces, or 1 percent.
Revenue from package deliveries continues to grow, up $267 million, or 9.3 percent, compared with the same period last year.
Postal officials said they were able to curb the losses by cutting back the hours at many post offices, reducing staff through attrition and consolidating about half of the service’s processing plants. But the agency said these actions were not enough to reduce its massive debt.
Patrick R. Donahoe, the postmaster general, said Congress should pass a Postal overhaul bill that will give the Service the flexibility it needs.
“We need comprehensive legislation to provide the Postal Service with a workable business model for today’s marketplace,” Mr. Donahoe said at a morning briefing on the service’s finances for its board of governors.
The Postal Service said it continued to suffer from a 2006 Congressional mandate that requires it to pay $5.5 Billion annually into a health fund for its future retirees. The agency defaulted on two payments last year for the first time and said it would not be able to make payments into the fund this year because of its worsening finances. The Postal Service and Postal worker unions said Congress needed to fix the requirement by lowering the amount of the payments and stretching out the length of time needed to pay it.
The Service also said the continuing shift to electronic communication, including online bill paying and e-mail, was affecting its bottom line. To offset the losses in this area, Postal officials have asked Congress for the authority to enter into new lines of business, like beer and wine delivery, from which it is currently prohibited. The Senate passed a Postal overhaul last year, but a House version never made it out of committee. Congress has not set a timetable for work on a new bill.
Mickey D. Barnett, chairman of the Postal Service board of governors, said that in the absence of Congressional action the board has asked agency officials to take several steps to deal with the continuing losses.
The changes include renegotiating labor agreements with Postal worker unions, administrative actions to reduce costs and, as a last resort, increasing prices on post office products.
“We’re looking at every option to close our widening budgetary gap,” Mr. Barnett said.
Over all, the Postal Service reported operating revenues of $16.3 Billion in the Second quarter, an increase of $121 million, or 0.7 percent, which it attributed to strong growth in e-commerce deliveries and a small increase in standard mail, also known as junk mail.
But Postal officials said the service’s expenses of $18.2 billion, which included continuing debt, offset the modest increase in revenue. Joseph Corbett, the Postal Service’s chief financial officer, said it had nearly $50 Billion in debt obligations.
Officials said the Postal Service continues to lose $25 million dollars a day as it waits for Congress to pass legislation to overhaul the Postal system.
The Postal Service has struggled as mail volume has declined, which it continued to do in the Second quarter, to 38.8 Billion pieces, down from 39.4 Billion for the same period a year earlier, according to agency financial documents.
Revenue from first-class mail, which provides the bulk of the revenue for the Postal Service, declined $198 million, or 2.7 percent, from the same period the previous year, with a decrease in volume of 713 million pieces, or 4.1 percent.
There were a few bright spots in the gloomy financial report. Revenue from advertising mail increased $96 million, or 2.4 percent, in the Second Quarter compared with the same period a year earlier on a volume increase of 181 million pieces, or 1 percent.
Revenue from package deliveries continues to grow, up $267 million, or 9.3 percent, compared with the same period last year.
Postal officials said they were able to curb the losses by cutting back the hours at many post offices, reducing staff through attrition and consolidating about half of the service’s processing plants. But the agency said these actions were not enough to reduce its massive debt.
Patrick R. Donahoe, the postmaster general, said Congress should pass a Postal overhaul bill that will give the Service the flexibility it needs.
“We need comprehensive legislation to provide the Postal Service with a workable business model for today’s marketplace,” Mr. Donahoe said at a morning briefing on the service’s finances for its board of governors.
The Postal Service said it continued to suffer from a 2006 Congressional mandate that requires it to pay $5.5 Billion annually into a health fund for its future retirees. The agency defaulted on two payments last year for the first time and said it would not be able to make payments into the fund this year because of its worsening finances. The Postal Service and Postal worker unions said Congress needed to fix the requirement by lowering the amount of the payments and stretching out the length of time needed to pay it.
The Service also said the continuing shift to electronic communication, including online bill paying and e-mail, was affecting its bottom line. To offset the losses in this area, Postal officials have asked Congress for the authority to enter into new lines of business, like beer and wine delivery, from which it is currently prohibited. The Senate passed a Postal overhaul last year, but a House version never made it out of committee. Congress has not set a timetable for work on a new bill.
Mickey D. Barnett, chairman of the Postal Service board of governors, said that in the absence of Congressional action the board has asked agency officials to take several steps to deal with the continuing losses.
The changes include renegotiating labor agreements with Postal worker unions, administrative actions to reduce costs and, as a last resort, increasing prices on post office products.
“We’re looking at every option to close our widening budgetary gap,” Mr. Barnett said.