Canada Post sees profits fall by $45m

Canada Post blames a fall of Q1 pre-tax profits of $45 million on strike action this year. It achieved $25 million in the quarter.

The postal operator put it down to the “continued impact from major customers making other delivery arrangements last fall and into 2019.”

Revenue in the quarter amounted to $1.7bn, a decrease of 1.5% as against the same period last year.

In parcels, revenues grew by 3.4% to $20 million, while it saw a one million piece volume increase by comparison to the year before. Within that segment, Domestic Parcels saw revenues grow by 9.4% and volumes by six million pieces. E-commerce is behind this rapid growth.

As is the story of so many postal operators, transactional mail fell by 68 million pieces (8.1%) and revenue fell by $31 million. In domestic letter mail, volumes fell by 61 million pieces (7.6%) and revenues fell by 3.1% despite a regulated increase in stamp prices.

The company said: “The ongoing decline in mail volumes in the digital era remains a significant challenge.”

The Canada Post Group of Companies reported a profit before tax of $39 million for the first quarter of 2019, compared to a profit before tax of $94 million for the same period in 2018.

The company said: “The $55 million decrease in profit was largely due to the results of the Canada Post segment. Purolator’s profit before tax was $12 million in the first quarter, compared to a profit before tax of $20 million for the same period in 2018. Results for the Group of Companies can also be attributed in part to a softening of the Canadian economy in late 2018 and in early 2019.”

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