Canada Post reports a profit and highlights significant growth in parcel volume due to Canadians buying more products online.
While it is the nation’s postal carrier, just like in the U.S. with USPS, the operations of Canada Post are funded by the revenue generated from the sale of its products and services, not taxpayer dollars.
Here is the Press Release from Canada Post
Canada Post is reporting a first-quarter profit, driven mostly by robust growth in its Parcels business as it delivers Canadians’ online purchases. The growth continues 2017’s positive momentum, when Canada Post employees delivered record Parcels volumes.
The Canada Post segment’s $70-million profit before tax for the first quarter, ended March 31, 2018, compares to a profit before tax of $50 million in the first quarter of 2017.1
In the first quarter, Canada Post – the country’s No. 1 parcel company – grew Parcels revenue by $110 million1 or 24.6 per cent,1 while volumes increased by 17 million pieces or 33.0 per cent2 compared to the same period in 2017. Domestic Parcels, the largest product category, continued to grow strongly, as revenue increased by $76 million1 or 23.6 per cent1, 2 and volumes grew by six million pieces or 17.3 per cent. 2 The growth in Parcels volumes was driven by strong performance from major commercial customers and by Canada Post’s solid delivery performance as consumers order more products online.
Transaction Mail results
Transaction Mail is mostly letters, bills and statements. In the first quarter of 2018, Transaction Mail revenue decreased by $46 million1 or 4.1 per cent1, 2 while volumes decreased by 50 million pieces or 4.0 per cent2 compared to the same period in 2017. For Domestic Lettermail, the largest product category, revenue decreased by $24 million1 or 1.6 per cent1, 2 and volumes decreased by 34 million pieces or 2.4 per cent.2 The ongoing decline in mail volumes is due to the growing use of digital alternatives by consumers and businesses. It is one of the most significant challenges facing the Corporation.
Direct Marketing results
In the first quarter of 2018, Direct Marketing revenue decreased by $3 million,1 which is an increase of 0.5 per cent1 when adjusted for trading days, while volumes fell by 23 million pieces or 0.5 per cent2compared to the same period in 2017. Revenue for Neighbourhood MailTM, the largest volume product category, remained constant while volumes decreased slightly, by seven million pieces compared to the same period in 2017.
Group of Companies results
The Canada Post Group of Companies3 reported a profit before tax of $96 million, compared to a profit before tax of $68 million1 in the same period in 2017. The Group of Companies’ positive first-quarter results were primarily driven by positive results in the Canada Post segment, which were largely due to parcel growth. The Purolator segment’s profit before tax was $21 million for the first quarter of 2018, compared to a profit before tax of $14 million in the first quarter of 2017.1
To read the full report in PDF, visit canadapost.ca/aboutus and select “Financial Reports” from the Corporate menu.
References: 1. The amounts for 2017 were restated as a result of new accounting standards. 2. Adjusted for trading days. 3. The Canada Post Group of Companies consists of the core Canada Post segment and its three non-wholly owned subsidiaries, Purolator Holdings Ltd., SCI Group Inc. and Innovapost Inc.
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