Summaries of Recent USPS NEWS RELEASES

Transformation Initiatives Reap Results During Past Year
September 6

In a fiscal year-end report to the Board of Governors, PMG Jack Potter detailed the "sweeping organizational changes" USPS has made since last September and outlined the challenges and opportunities he sees ahead.

"Our transformation plan began last September," Potter told the Board. "We are well on our way to achieving the operational targets we set for ourselves." Even before the events of Sept. 11, Potter said, the softening economy had "bared fundamental flaws in our business model." Mail volumes were declining, while the universal delivery network expanded by 1.7 million new deliveries a year.

"We realized that for change to be meaningful," Potter told the Governors, "we had to start at the top. We reduced the number of officers by 20%. And we eliminated over 800 Headquarters positions." He went on to list other transformational changes: eliminating area offices, reducing administrative staff, balancing workhours against workload.

"I also said we would manage costs. I am pleased to report that we have pulled $2.5 billion out of our costs this fiscal year," Potter said. "We did it partly by reducing workhours by more than 77 million. The net effect - we have 23,000 fewer employees. Our total complement is similar to what it was in 1995."

USPS Planning $600 Million Net Income in Fiscal Year 2003
September 6

The USPS financial plan for FY 2003 calls for a net income of $600 million for the year and the first reduction in outstanding debt since 1997. Chief Financial Officer Richard Strasser presented the plan at today's Board of Governors meeting.

For FY 2003, revenue is projected to grow to $70.4 billion. That is $3.9 billion, or 5.9%, above FY 2002's estimated revenue of $66.5 billion. Mail volume is projected to grow a modest 1.9% to 205.7 billion pieces, but will still be below FY 2000 levels.

Expenses are budgeted at $69.8 billion, a 3.2% growth over estimated expenses for FY 2002 of $67.7 billion. "We plan to reduce workhours by 30 million and reduce complement by another 12,000 employees, while at the same time adding 1.65 million daily deliveries," Strasser said.

New Pricing Initiatives Reinforce Transformation
September 6

The USPS Board of Governors has approved the Postal Rate Commission filing of two pricing initiatives designed to encourage greater efficiency and take advantage of USPS's existing pricing flexibility.

The first is a new classification for Periodicals. The other supports a negotiated service agreement (NSA) between USPS and Capital One, USPS's fourth largest customer and the largest single producer of First-Class Mail. Both will be filed as experiments, tentatively in mid-September.

As outlined in the Transformation Plan, NSAs are pricing initiatives designed to improve USPS efficiency, reduce costs and increase revenue. NSAs are one way to accommodate customers wanting pricing and services that meet their specific needs.