by The Postal Service has incurred net losses in 14 of the last 16 fiscal
quarters. The fiscal 2010 year-to-date net loss is $5.4 billion, compared to
a loss in the same period last year of $4.7 billion.
The increase in operating expenses was attributable largely to higher
workers' compensation expenses due to a non-cash fair value adjustment and
higher retiree health benefits expenses.
The organization's financial situation is compounded by its obligation to
pay $5.4 billion to $5.8 billion annually to prefund retiree health
benefits.
Liquidity remains a major concern as the end of the fiscal year approaches.
Although cash flow appears to be sufficient for 2010 operations, it is
uncertain whether cash flow, together with maximum available borrowing of $3
billion, will be enough to fund the Congressionally-mandated $5.5 billion
payment to the Retiree Health Benefit Fund on September 30 and retain
sufficient liquidity into 2011, according to Joseph R. Corbett, the Postal
Service's Chief Financial Officer.
Excerpts from the USPS Press Release of August 5, 2010:
http://www.usps.com/communications/newsroom/2010/pr10_077.htm
--
Victor Manta, PWO, AIJP
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