Canada Post parts with downtown Vancouver hub to avoid loss
The country’s embattled mail delivery service, Canada Post, swung to a profit in the first quarter but only because it sold off a key real-estate holding in Vancouver.
The mail service made $51 million before tax for the first quarter of the year, boosted by the sale of its mail sorting plant in downtown Vancouver in January.
The sale of the property gave the federal Crown corporation a $109-million gain before taxes. A year earlier, the group had a pre-tax loss of $73 million in the first quarter.
“The plant was one of Canada Post’s most significant properties,” the Crown company said in a quarterly release.
Without the property sale, the company said it would have lost $58 million for the three-month period between January and March this year including a $41-million loss at the core Canada Post segment.
Total delivery volumes fell by 136 million pieces in the quarter year on year, while revenues were $1.5-billion or about the same as the first quarter of 2012.
Financial results “continued to be adversely affected by mail erosion driven by electronic substitution,” Canada Post said.
The company said Wednesday that it expects to report a full-year loss for 2013 amid a longer-term slide.
Canada Post has been grappling with a persistent drop in many forms of mail as a result of newer technologies such as electronic mail and online banking.
In a bid this month to boost the service’s flyer delivery business notices went out to thousands of residents on Canada Post’s Consumers’ Choice database, a list of homes that have requested un-addressed mail not be delivered, asking them toaccept flyers again.
The pitch: coupon-loaded flyers “can save you money and keep you connected with your local community,” the open letter said.
Besides Canada Post, the group includes the Purolator courier service and other subsidiaries.
A lone bright spot has been parcel deliveries – mainly for goods bought online and mailed to buyers. Volumes were up 4 per cent to 300,000 packages while revenues ticked 2.9 per cent higher.
With files from the Canadian Press.