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.