Canada Post Corporation has reported a C$35 million loss for its core Canada Post business unitin its second quarter, ending 2 July, largely as a result of its two-week operational shutdown in
June due to its labour dispute with the Canadian Union of Postal Workers (CUPW).That loss represents a $70-million decline from the $35-million profit recorded by the group’score postal unit in the same period a year earlier. During the quarter, the company’s Canada Postoperation lost an estimated $167 million in revenues due to the impact of the disruptions. Thesebegan with rotating strikes in early June and culminated in the closure of the company’s entirepostal network from 14-27 June following a full-scale lockout.
The shutdown was eventually ended due to the passage of legislation in Canada’s parliament, ‘AnAct to provide for the resumption and continuation of postal services’, after Canada Post and theCUPW failed to find common ground in their dispute over modernisation, reforms, and workingconditions, remaining divided on a number of key bargaining issues including wages, pensions andsick leave.
The Corporation overall, including the Canada Post segment and the consolidated results of itsPurolator courier and express business, and its Logistics and other units, reported a loss of $17million in the second quarter, down from a net profit of $47 million during the same period a yearearlier. Consolidated revenue from operations in the second quarter was $1.76 billion, down 2.4%from the same period a year earlier.
All three lines of business in the Canada Post unit (Transaction Mail, Parcels, DirectMarketing) sustained year-on-year declines in revenue and volumes in the second quarter, mainly dueto the effects of the labour disruption. Volumes in Transaction Mail declined by 6% in the secondquarter compared to the same period in 2010, driven by a 5.8% volume decline in domesticLettermail. Volumes in Parcels and Direct Marketing declined by 14.6% and 12.2%, respectively.
In the six-month period ended 2 July, the postal division lost $13 million, representing a$70-million decline from the $57-million profit recorded in the same period a year earlier. TheCorporation overall reported a profit of $3 million for the six-month period, down from a profit of$71 million in the same period in 2010.
The group said its Canada Post Pension Plan continued to pose financial challenges in the firstsix months of 2011. The Canada Post unit made $214 million in special payments to the plan toaddress its solvency deficit, over and above regular contributions of $150 million, for a combined$364 million in regular and special contributions in the first six months of 2011.
Canada Post reported its quarterly financial results for the first time, in accordance withrecent changes to the Financial Administration Act relating to Canadian state-ownedcorporations.
