Canada Post’s Losses Escalate for 3rd Straight Year, Incurs $193M Operating Loss in 2013
By Esther Tanquintic-Misa | May 6, 2014 2:23 PM EST
Canada Post's losses continued to escalate for the third consecutive year, incurring a $193 million operating loss in 2013.
But Deepak Chopra, Canada Post Corp. Chief Executive Officer, said new schemes put in place by the company, including delivering packages to online shoppers, will offset the decline in its traditional mail business.
A Canada Post employee delivers mail in Ottawa December 11, 2013. Canada's postal service will phase out urban home delivery within five years and hike the cost of postage stamps to try to stem soaring losses, the post office said on Wednesday. REUTERS/Chris Wattie
It has also decided to end door-to-door mail delivery.
"We're moving from the letterbox to a cart," Chopra told Bloomberg. "What's happening now is a bit of a race to reposition our business from letters to parcels."
Canada Post's upsetting 2013 fiscal performance follows a decline trend of $106 million in 2012 and $226 million in 2011.
But if profits at courier subsidiary Purolator Holdings Ltd. were to be excluded, the firm's overall 2013 loss was at a bigger $269 million.
Revenue in the meantime grew a measly 0.4 per cent to $7.6 billion in 2013.
"Obviously, there are huge challenges, but we're optimistic about the future," spokesman Jon Hamilton said. "The early results are good. It's turning in the right direction."
One of the things that Chopra did when he took over the reins of the money-losing Ottawa-based postal agency three years ago was to "invest in technology, invested in more scanning, more visibility."
"We placed a bet very early on, literally in the first 90 days, on e-commerce," he said, as he recalled that Canada Post didn't even have an iPhone application when he joined in February 2011.
Chopra said Canada Post was the last mail service to introduce postal codes and even automate mail sorting.
The company increased the prices of stamps by 35 per cent to 85 cents at the end of March for a book of at least 10 pieces. Single stamp prices are now $1.
Canada Post is scheduled to convert 5.1 million homes to community mailboxes.
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