Federal Employees News Digest

USPS revenue gains on package business

The U.S. Postal Service reported a 3.3 percent increase in operating revenue for the first quarter of fiscal 2016.

The Postal Service posted operating revenue of $19.3 billion for the first fiscal quarter —a $613 million increase over the same period last year. USPS credited the increase to a record volume of packages delivered during the 2015 holiday season.

 “Shipping and package revenue grew 13.5 percent over the same period last year, and was particularly strong during the holiday shipping season,” Postmaster General and CEO Megan Brennan said last week. “We projected and delivered more than a 16 percent increase in package volume.”

At the same time, Brennan warned that the organization’s overall financial picture is still dire, and called on Congress for a remedy.

“Despite these achievements and the best efforts of our employees, our financial condition will worsen without legislative reform,” said Brennan. “Our financial situation is serious but solvable through the enactment of prudent legislative reform.”

USPS reported “controllable income” for the quarter of $1.3 billion, compared to $1.1 billion for last’s year’s period. Controllable income accounts for operational expenses such as compensation, benefits and work hours—but does not reflect expenses such as those resulting from the statutory requirement to prefund retiree health benefits.

Net income for the quarter was $307 million—up $1.1 billion from a net loss of $754 million for the same period last year. The increase was attributable to a favorable change in workers' compensation expense due to interest rate changes.

"While net income is favorable compared to a net loss, it unfortunately does not reflect the end of our losses," Chief Financial Officer and Executive Vice President Joseph Corbett said in a statement. "Excluding the favorable impact of interest rate changes and the exigent surcharge, the organization would have actually reported a net loss of approximately $700 million in the first quarter. Absent legislative reform, the exigent surcharge is expected to roll back in April, and our losses will increase by approximately $2 billion per year."

See more at: http://about.usps.com/news/national-releases/2016/pr16_006.htm.

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Edward A. Zurndorfer Certified Financial Planner
Mike Causey Columnist
Tom Fox VP for Leadership and Innovation, Partnership for Public Service
Mathew B. Tully Legal Analyst

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