Canada Post increases Q1 profits

Supported by the continuing growth of its parcel business, Canada Post saw a Q1 2016 profit before tax of $44 million. This compares to a Q1 profit before tax of $24 million.

In a statement Canada Post said of the growing profits,  “First-quarter Parcels revenue for the Canada Post segment climbed 12.5% and volumes grew 14.4% over the same period a year ago. As an example of the growth, Canada Post delivered one million or more parcels on every Monday in January as Canadians shop online more often.”

Transactional mail fell by $40 million. Volumes of bills, letters and statements dropped by 83 million pieces compared to the same period in 2015. Since the beginning of 2015, Canada Post’s mail volumes have fallen by over 300 million pieces.

The Canadian postal operator warned, “Though both parcels and direct marketing represent opportunity for Canada Post, their growth will not be enough to offset the decline in the core Lettermail business and pay for the pension, or allow the Corporation to invest in its network and customer service. Therefore, this growth will not be enough to ensure Canada Post’s long-term financial self-sustainability.”

Canada Post has implemented a range of measures that are hoped to reduce the costs of mail delivery across the country. These included the community mailbox scheme that the new government has strongly urged the postal operator to revisit. On the 5th of May, Canada’s Public Services Minister Judy Foote announced that the Canadian government was launching an independent review of Canada Post’s activities.

In the first phase of the review, a four-member Task Force is working to “gather facts, conduct analysis and come up with viable options for postal service in Canada” and then produce a Discussion Paper in September.