The U.S. Postal Service (USPS) on Tuesday posted a net loss of 5.1 billion U.S. dollars for the 2011 fiscal year that ended on Sept. 30 as mail volumes continued to drop.
The year-end loss would have been about 10.6 billion dollars had it not been approved by Congress to postpone a 5.5-billion-dollar payment for future retirees’ health benefits into fiscal 2012, said chief financial officer Joe Corbett.
The total mail volume declined by 3 billion pieces, or 1.7 percent, from 2010, mainly because of the recession and the increasing use of electronic communications, the USPS said.
It added that mail volumes have dropped more than 20 percent in the last five years, and the USPS has been in challenging fiscal situation for several years.
The USPS may run out of cash to operate by next September and will default on the benefits payment later this month, said Corbett, noting that the loss last year was 8.5 billion dollars, including a benefits payment.
“To return to profitability we must reduce our annual costs by 20 billion dollars by the end of 2015,” said Patrick Donahoe, Postmaster General and CEO, adding that aggressive cost-cutting actions would be probable.