Postal Service Profit Up $1.7 Billion
The Postal Service posted another profitable quarter and is now $1.7 billion in the black.
Postal Service Chief Financial Officer Michael Riley said Tuesday that the agency finished the second quarter ending March 1 with a $1.5-billion surplus, which climbed to $1.7 billion by April 26.
Nonetheless, Riley told the postal governing board that agency executives are concerned that mail volume is falling short of expectations, a decline that could hurt profits in coming months.
He estimated that the agency will finish the fiscal year in September between $700 million and $900 million in the black, an indication that some losses are likely between now and then.
The post office had a $1.77-billion profit for fiscal 1995, a showing that was anticipated because of rate increases on Jan. 1, 1995.
It is normal for the Postal Service to record a surplus in the year or so following rate increases. Rising costs tend to erode this over time, however, with the agency generally breaking even in the second or third year, then slipping into the red before having to raise rates again.
Generally surplus funds are used to reduce debt accumulated during years when the agency loses money and to purchase new equipment.
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