Canada Post Group of Companies lifted from $58-million loss by $109-million gain from sale of downtown Vancouver plant
Expects substantial financial loss for the year
May 29, 2013
Ottawa (ON) – The sale of a mail processing plant in downtown Vancouver lifted the Canada Post Group of Companies1 to a profit before tax of $51 million for the first quarter ended March 30, 2013. If not for the $109-million gain from the sale, the Group of Companies would have had a loss before tax of $58 million for the first quarter. The Group of Companies reported a loss before tax of $73 million for the first quarter of 2012.
The core Canada Post segment would have reported a loss before tax of $41 million for the first quarter if not for the sale of the Vancouver plant. Instead, the segment is reporting a profit before tax of $68 million for the first quarter, compared to a loss before tax of $59 million for the same period last year. The plant was one of Canada Post’s most significant properties and was disposed of in January 2013, as a new multi-purpose facility is being built at the Vancouver International Airport.
Declining volumes continued to underscore the changing needs of Canadians for postal services and the need for Canada Post to transform the business. The segment’s total volumes declined by more than 136 million pieces in the first quarter compared to the same period a year earlier and revenue from operations was essentially flat despite price increases. With continued volume declines, eroding revenue and limited flexibility to make rapid adjustments given its infrastructure and high fixed costs, Canada Post expects a substantial financial loss in 2013.
Transaction Mail is primarily the letters, bills and statements that generate most of the Canada Post segment’s revenue. In the first quarter, Transaction Mail volumes declined by 60 million pieces or 1.9 per cent compared to the same period in 2012. This is due to the impact of digital alternatives, the implementation of pay-for-paper initiatives by some of Canada Post’s largest customers, particularly in the banking and telecommunications sectors, and the highly competitive environment.
Direct Marketing volumes declined by 76 million pieces or 2.9 per cent compared to the same period in 2012. In Publications Mail, publishers and consumers are shifting to digital alternatives, while Unaddressed Admail customers are reducing their spending or redirecting portions of it to other channels.
Canada Post’s strong position in the competitive business-to-consumer delivery market was reflected in the growth of parcel volumes, which were up by about 300,000 items or 4.0 per cent in the first quarter compared to the same period in 2012.
The operations of the Canada Post Group of Companies are funded by the revenue generated by the sale of its products and services, not taxpayer dollars. Canada Post has a mandate from the Government of Canada to remain financially self-sufficient and to provide a standard of postal service that is affordable and meets the needs of the people of Canada.
To access the full report in PDF, visit canadapost.ca/aboutus and select “Quarterly Financial Reports” from the Corporate menu.
1 The Canada Post Group of Companies, or the Group of Companies, refers to the Canada Post Corporation and its principal subsidiaries Purolator Inc., SCI Group Inc. and Innovapost Inc.
*This press release was obtained from the Canada Post web-site for your information.
Commentary on the “doom and gloom” reports by Canada Post and the Harper government’s latest budget implementation bill, bill C-60
This recent press release by Canada Post regarding the last financial business quarter is the same type of “doom and gloom” reporting that the corporation has been carrying out for the past few years and which the monopoly controlled media repeats ad nauseum. In previous Sunday e-mails, we have extensively covered all this “doom and gloom” reporting and have shown how this is serving the corporate aims. We have also disseminated many articles on the subject written by post office retiree, Louis Lang.
This type of rendering of accounts by Canada Post through its quarterly and annual financial reports is what is facilitating the Harper government in imposing its budget implementation bill, bill C-60 which will make meddling in collective bargaining at Crown corporations a standard practice for the federal government.
The bill targets three major Crown corporations that is Via Rail, Canadian Broadcasting Corporation and Canada Post Corporation. Finance Minister Jim Flaherty tabled this budget implementation bill on April 29, 2013 in the House of Commons and has since become law.
At the time of introducing Bill C-60 in the House of Commons, The Globe and Mail reported Treasury Board President Tony Clement citing the example of Canada Post in justifying the government`s intervention at bargaining. Clement was reported as saying: “it is common knowledge that Canada Post Corporation is struggling to re-imagine itself with a declining demand”. He then added: “the three are all good examples of Crown corporations that when their financial viability goes too far south, they always seem to be at the doorstep of the government”.
While introducing the bill, the Conservative government said that it would not take “marching orders from union bosses”. Parliamentary Secretary Pierre Poilievre was reported as commenting: “I represent taxpayers and frankly taxpayers expect us to keep costs under control so that we can keep taxes down. It is for those taxpayers that we work. Not union bosses.”
Amongst many other things, the bill gives more powers and oversight to the Treasury Board Secretariat over collective bargaining conducted by Crown corporations which can go as far as to set the wages and benefits of the workers basing themselves on equivalents in the private sector.
The bill also allows for the government to sit at the bargaining table as a third party. Postal workers already know how it feels to have the government interfere in the bargaining process with back-to-work legislation.
Denis Lemelin, national president of the Canadian Union of Postal Workers, said to the CBC that “in 2011, the Harper government got rid of our right to strike. Now, with this omnibus bill, they got rid of our right to negotiate.”
On May 8, 2013 the CUPW stood on Parliament Hill with other workers and the Opposition Labour Critic Alexandre Boulerice to oppose Harper’s budget implementation bill. In a bulletin to the membership written the same day, Denis Lemelin wrote: “Imagine the implications of this regime at CBC, at the Bank of Canada, at the Canada Council for the Arts, and other Crown corporations whose autonomy is established by law”.
He also added: “Of course, we don’t have to imagine the implications at Canada Post. We already know what it is like when the government interferes at the negotiating table. In 2011, the Harper Conservative government decided to impose even lower wages on postal workers than what Canada Post had put on the table. Under C-60, the government’s offer would be the only offer on the table”.
While the bill targets three of the above mentioned Crown corporations, it affects all 47 Crown corporations, which taken altogether, represents more than 88,000 workers.
Note that the main reason for the conversion of the post office from a government department to a Crown corporation in October 1981, 32 years ago, was to allow for collective bargaining at the post office without the interference of the government and that of Treasury Board.
It is this situation which Canada Post Corporation is trying to reverse with all of its “doom and gloom” reporting through its quarterly and annual financial reports. CPC management is on a very retrogressive path and one which aims at ultimately privatizing the post office while using the same old justifications as the ones contained in its last quarterly financial report.