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MTAC. Mailers' Technical Advisory Committee. FINANCIAL PERFORMANCE JANUARY, FY 2005. Richard J. Strasser, Jr. Chief Financial Officer & Executive Vice President. Summary: October 1, 2004 - January 31, 2005. Unusually high revenue/volume growth in November - PowerPoint PPT Presentation
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Richard J. Strasser, Jr.Chief Financial Officer &Executive Vice President
FINANCIAL PERFORMANCE
JANUARY, FY 2005
FINANCIAL PERFORMANCE
JANUARY, FY 2005
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCESummary: October 1, 2004 - January 31, 2005Summary: October 1, 2004 - January 31, 2005
Unusually high revenue/volume growth in November
Slight revenue/volume growth in October and December
Slight revenue/volume decline in January
Increased expenses due to cost inflation and additional volumes and deliveries
High productivity increase held down expenses
Net income below last year, but over plan
Unusually high revenue/volume growth in November
Slight revenue/volume growth in October and December
Slight revenue/volume decline in January
Increased expenses due to cost inflation and additional volumes and deliveries
High productivity increase held down expenses
Net income below last year, but over plan
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCEIncome Statement – January 2005Income Statement – January 2005
Numbers may not add due to rounding($ Millions)Numbers may not add due to rounding($ Millions)
ActualActual Var Var %Plan%PlanPlan Plan SPLYSPLY
RevenueRevenue $5,815 $5,815 +92 +92 +1.6 +1.6 $5,723 $5,723 -0.8%-0.8%
ExpenseExpense 5,673 5,673 -122 -122 -2.1 -2.1 5,795 5,795 +1.8%
Net IncomeNet Income $ 143$ 143 +215 +215 -$ 72 -$ 72 $ 290$ 290
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCEVolume Compared to SPLYVolume Compared to SPLY
71.4B 74.1B71.4B 74.1B
ActualActual
+2.8B+2.8B
+3.9%+3.9%
SPLYSPLY
Quarter 1 Quarter 1
53.8B 56.8B
January January
+5.5%+5.5%
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCEVolume - Percent Change to SPLYVolume - Percent Change to SPLY
January YTD +3.9%January YTD +3.9%
FY 2005FY 2005Quarter 1 +5.5%Quarter 1 +5.5%
NOVNOV DECDEC JANJANOCTOCTSEPSEP
5.4% 4.4%
1.2%
15.0%
1.6%
-1.0%
FY 2004FY 2004AUGAUG
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCE
-3.8%-2.9%
5.1%
1.3%
2.4%
5.0%
-0.9%
-2.7%
2.1%
6.2%
-1.2%-0.3%
Total First-Class Priority Standard Packages All Other
Plan Actual
Revenue Compared to SPLY – January YTDRevenue Compared to SPLY – January YTD
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCEVolume and Revenue - Change to SPLY- Jan YTDVolume and Revenue - Change to SPLY- Jan YTD
+3.9%+3.9%74.1B74.1BTotalTotal +$500M+$500M
+7.5%+7.5%34.7B34.7BStandardStandard +$382M+$382M
-0.1% -0.1%3.0B3.0BPeriodicalsPeriodicals -$2M-$2M
+0.3%+0.3%416.5M416.5MPackage Serv.Package Serv. -$10M-$10M
+2.6%+2.6%309.9M309.9MPriorityPriority +$38M+$38M
+0.6%+0.6%17.9M17.9MExpressExpress +$1M+$1M
-$40M-$40M
Revenue Change
Revenue Change
+0.7%+0.7%35.1B35.1BFirst-ClassFirst-Class
ChangeChangeFY 2005FY 2005 Volume Volume
OtherOther +$131M+$131M+16.7%+16.7%0.6B0.6B
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCEIncome Statement – January Year-to-dateIncome Statement – January Year-to-date
Numbers may not add due to rounding($ Millions)Numbers may not add due to rounding($ Millions)
ActualActual Var Var %Plan%PlanPlan Plan SPLYSPLY
RevenueRevenue $24,602 $24,602 +709 +709 +3.0 +3.0 $23,893 $23,893 +2.1%+2.1%
ExpenseExpense 22,810 22,810 -231 -231 -1.0 -1.0 23,041 23,041 +3.7%+3.7%
Net IncomeNet Income $ 1,792$ 1,792 +940+940 $ 852 $ 852 $ 2,100$ 2,100
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCEDeliveries – January 2005Deliveries – January 2005
Deliveries 143.0MDeliveries 143.0M
Change From SPLY Change From SPLY 1.8M 1.8M
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCE
2.3M2.3M
Workhours - Change to SPLY - January YTDWorkhours - Change to SPLY - January YTD
1.1M1.1M
ActualActual
SavingsSavings
Increased Volume/DeliveriesIncreased Volume/Deliveries
3.4M3.4M
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCE
Change in Combined Workload
Change in Resources
Used
Total Factor Productivity DefinedTotal Factor Productivity Defined
==
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCE
Change in Combined Workload
Change in Resources
Used
2.6%0.4%
2.2%
Total Factor Productivity – January YTDTotal Factor Productivity – January YTD
==
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCEProductivity Components – January YTDProductivity Components – January YTD
2.6%
CostInflation
Workload Growth
TFPTFP
5.9%5.9% 5.9%5.9%
3.3%
Actual Expense
3.7%
2.2%2.2%
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCETotal Factor ProductivityTotal Factor Productivity
0
2
4
6
8
10
12
14
16
18
20
71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05
Percent GrowthPercent Growth *January YTD*January YTD**
Cumulative 1972 – 2005Cumulative 1972 – 2005
FY
FY 2005 – FINANCIAL PERFORMANCEFY 2005 – FINANCIAL PERFORMANCEFY 2005 Quarter 2 – Summary OutlookFY 2005 Quarter 2 – Summary Outlook
Above ForecastAbove Forecast
$17.2B $17.2B
-$0.2B -$0.2B Above Forecast Above Forecast
$17.0B $17.0B
51.1B 51.1B
ForecastForecast
Expenses Expenses $16.6B $16.6B
Net Income/Loss Net Income/Loss +$0.7B +$0.7B
Revenue Revenue $17.3B $17.3B
Below ForecastBelow Forecast
Volume Volume 51.5B 51.5B
FY 2004 FY 2004Quarter 2Quarter 2 OutlookOutlook
Above ForecastAbove Forecast
Escrow Requirement Recreates Over-Funding
$3.1B Required to Fund FY 2006 EscrowAnd Annual Funding Requirement Increases to $5.4B in FY 2015
USPS Recommended Elimination of Escrow
Requirement
PUBLIC LAW 108-18PUBLIC LAW 108-18 Escrow Account and Use of “Savings”
Preferred - With Military Service Costs Returned to Treasury:
Pre-Fund Postretirement Health Benefit Costs of All Employees and Retirees
Eliminate Escrow Requirement – USPS
Would Be Only Agency Pre-Funding
Pension and Retiree Health Benefit Costs
PUBLIC LAW 108-18PUBLIC LAW 108-18 USPS Proposal On “Savings”