Canada Post reports $107-million loss before tax in the first quarter

Canada Post has released its first quarter 2023 results. The Corporation recorded a loss before tax of $107 million as Parcels revenue was relatively flat and Transaction Mail and Direct Marketing revenue declined from the same period a year earlier.

The company continued to face intensifying competition in the parcel delivery sector. This increased competition as well as a softer ecommerce market negatively affected Parcels revenue and volumes in the first quarter.

Highlights

• The Canada Post segment’s loss before tax of $107 million in the first quarter marked an improvement of $22 million from the same period of 2022.
• Revenue fell by $32 million, or 1.7 per cent, compared to the same period of 2022.
• Parcels revenue was relatively flat as volumes declined slightly from the same period of the prior year.
• Direct Marketing revenue and volumes fell as businesses continued to pull back on marketing, and Transaction Mail revenue and volumes continued to erode.
• With Parcels representing approximately half of Canada Post’s revenue, we continue to invest to better position the company in a competitive market and ensure the postal service continues to be a valued delivery partner.
• We’re making significant strategic investments to improve service and tracking, enable our network, increase capacity and enhance the customer experience.

Click here to read the news release.

2023/05/26

Canada Post releases 2022 results and Annual Report

Canada Post’s 2022 results and Annual Report have been released. The Corporation recorded a loss before tax of $548 million in 2022. Growing competition in the parcel delivery sector, combined with economic uncertainty and reduced consumer spending, negatively affected parcel volumes and revenue.

To read the full story of 2022, including how we’re delivering on our purpose and transformation plan, A Stronger Canada – Delivered, go to our 2022 Annual Report on canadapost.ca.

Please watch this video from President and CEO Doug Ettinger, which provides context on the financial results and how we’re fighting for every parcel in an increasingly competitive landscape.

What you need to know:

• • Canada Post’s 2022 loss before tax widened by $58 million from a loss before tax of $490 million in 2021.
• • Total revenue for the Canada Post segment declined by $167 million, or 1.9 per cent, from the previous year.
• • While Parcels revenue declined from 2021, the line of business ended 2022 with stronger revenue than before the pandemic started.
• • Transaction Mail volumes continued to erode, while Direct Marketing revenue and volumes slowly recovered from the prior year.
• • We’re making strategic investments to improve service and tracking, enable our network, increase capacity and enhance the customer experience.
• • While online shopping has slowed partly due to economic uncertainty and the rising cost of living, the ecommerce market is expected to more than double over the next decade.

2023/05/04

Canada Post segment records $227-million loss before tax for third quarter

Canada Post’s third-quarter financial results are available. Here’s what we’re seeing and forecasting.

Canada’s ecommerce market has begun to settle after two years of accelerated growth. Online shopping is softening with the return of in-store shopping, the rising cost of living and economic uncertainty. The economy has also affected spending on direct marketing.

We’re also facing increased competition in ecommerce. There’s more in-house delivery by major retailers, more delivery to consumers in cities by traditional couriers and more new low-cost competitors.

The good news is that the fundamentals of ecommerce growth remain strong. We expect ecommerce to double in the next 10 years – with continued growth in our parcel volumes and revenue.

Canada Post remains very well positioned to succeed. Our transformation plan puts the needs of Canadians first and addresses what’s happening in the market. We’re investing billions of dollars, building capacity and improving service so that we can take on the competition. Canadians tell us they prefer us because we’re Canadian and they trust us.

Below are some key results compared to the same periods in 2021:

In the third quarter of 2022, Canada Post recorded a loss before tax of $227 million. That is an improvement from a loss before tax of $264 million in the third quarter of the prior year. For the first three quarters of the year, Canada Post recorded a loss before tax of $516 million, compared to a loss before tax of $492 million in the same period a year earlier.

Parcels: In the third quarter of 2022, revenue for the Parcels line of business increased by $22 million, or 2.8 per cent, as volumes declined by 12 million pieces, or 16.2 per cent, compared to the same period in 2021.

Transaction Mail: Revenue fell by $5 million, or 1.0 per cent, in the third quarter compared to the same period in 2021, as volumes fell by 28 million pieces, or 4.9 per cent.

Direct Marketing: For the third quarter, Direct Marketing revenue decreased by $11 million, or 4.7 per cent, while volumes fell by 107 million pieces, or 10.9 per cent, compared to the same quarter in 2021.

2022/11/25

Canada Post segment reports $160-million loss before tax for second quarter

Canada Post recorded a loss before tax of $160 million in the second quarter of 2022 as Canadians’ online shopping slowed and revenue declined for Parcels and Transaction Mail.

The Canada Post segment’s loss widened from a loss before tax of $151 million in the second quarter of last year. Revenue fell by $98 million, or 3.9 per cent, from a year earlier.

For the first half of 2022, the segment recorded a loss before tax of $289 million, compared to $228 million in the same period a year earlier. Revenue fell by $218 million, or 5.0 per cent, compared to the first half of 2021.

Parcels revenue declined for both the second quarter and first half of 2022, as Canadians’ online shopping slowed from elevated levels a year earlier. Transaction Mail volumes and revenue continued to erode. Direct Marketing continued to recover compared to the previous year, even as consumers and businesses pulled back on spending due to uncertainty about the economic outlook.

Cost of operations improved by $84 million, or 4.3 per cent, for the second quarter compared to the same period a year earlier. For the first half of 2022, costs improved by $161 million, or 3.3 per cent, from the prior year period.

Below are some key results for Q2 compared to the same quarter of the prior year:

Parcels

• Volumes fell by 27 million pieces, or 27.9 per cent.
• Revenue declined by $79 million, or 7.3 per cent.

Transaction Mail

• Volumes declined by 59 million pieces, or 8.1 per cent.
• Revenue fell by $28 million, or 2.9 per cent.

Direct Marketing

• Volumes increased by 140 million pieces, or 16.7 per cent.
• Revenue rose by $24 million, or 13.2 per cent.

2022/08/26

Canada Post segment records $129-million loss before tax for first quarter

Canada Post recorded a loss before tax of $129 million in the first quarter of 2022 as revenue declined more than costs.

Revenue fell by $120 million, or 6.1 per cent, in the first quarter of 2022 compared to the same period in 2021. The largest component of this decline is from lower Parcels volumes in the first quarter of 2022, compared to high Parcels volumes in the first quarter of 2021, when many physical stores were closed due to COVID-19.

Transaction Mail revenue and volumes also decreased from the prior year. Direct Marketing continued to recover from the impact of customers postponing or cancelling marketing campaigns, which had begun early in the pandemic, and so revenue and volumes increased.

Cost of operations decreased by $77 million, or 2.3 per cent, in the first quarter of 2022 compared to the same period in 2021. Labour costs decreased by $34 million in 2022 due to a drop in parcel volumes and one less paid day compared to 2021, while employee benefits costs decreased by $85 million due to an increase in discount rates. These were partly offset by higher transportation and facilities costs, as well as increased spending to sustain the network and improve its capacity.

Below are some key results for Q1 compared to the same period last year:

Parcels:

• Volumes fell by 23 million pieces, or 23.1 per cent (compared to Q1 of 2021, when volumes were high because stores were closed due to COVID-19).
• Revenue declined by $92 million, or 9.6 per cent.

Transaction Mail:

• Volumes declined by 65 million pieces, or 9.1 per cent.
• Revenue fell by $36 million, or 5 per cent.

Direct Marketing:

• Volumes increased by 66 million pieces, or 7.6 per cent.
• Revenue grew by $18 million, or 8 per cent.

2022/05/27