USPS Posts $329 Million Quarterly Loss

USPS Posts $329 Million Quarterly Loss

The U.S. Postal Service lost $329 million in its last quarter and expects to run out of cash by the end of its fiscal year Sept. 30.

The USPS warned it will be forced to default on some of its federal financial obligations unless Congress raises its borrowing limit.

The $329 million loss in the quarter that ended Dec. 31, 2010, compares with a $297 million loss in the same period in 2009.

The USPS blamed the loss on the cost of retiree healthcare benefits and said changes to its workers' compensation liability led to the loss. Otherwise, the USPS said it would have had a $226 million profit.

Operating revenue declined 2.6 percent to $17.9 billion for the quarter. Total mail volume was up 1.5 percent at 46.4 billion pieces.

The postal service projects $2 billion in cost savings in fiscal year 2011 as it makes aggressive cuts across the organization.

It reduced work hours in the quarter by 6.4 million hours or 2.1 percent, the equivalent of about 3,600 full-time employees.

The number of career USPS employees fell by 5,616 workers from October to the end of December to 578,292 employees.

-- Contact William B. Cassidy at wcassidy@joc.com.