Canada Publish mentioned Friday its monetary scenario is so grim it may run out of working funds in lower than a yr, after the Crown company posted one other whopping pre-tax lack of $748 million in 2023.
In its annual report launched late Friday afternoon, the corporate predicts “bigger, unsustainable losses in future years” with out main adjustments to its working mannequin.
“Even with Canada Publish’s lately proposed stamp worth improve, the Company initiatives that, with out extra borrowing and refinancing, it can fall beneath its required working and reserve money necessities by early 2025,” the report says.
Canada Publish has been shedding cash since 2018. Within the final six years, its losses have totalled $3 billion.
The company cites declining income from supply of letter mail and parcels, regardless of a rise within the quantity of packages the corporate is delivering.
Letter mail has been declining because it peaked in 2006. Canada Publish delivered lower than 2.2 billion letters in 2023.
The price of delivering mail and parcels is rising, the corporate mentioned. Canada Publish has struggled to compete post-pandemic with the rising variety of new, privately owned supply corporations that use what it calls a “low-cost labour” enterprise mannequin.
“These rivals grew quickly, leaning on their low-cost-labour enterprise fashions that depend on contracted drivers to supply decrease costs, plus higher comfort with night and weekend service,” the report mentioned.
Canada Publish tried to interrupt into the e-commerce market however its share “shortly eroded” from 62 per cent in 2019 to only 29 per cent, the corporate mentioned.
“Whereas we have reported on our declining monetary scenario for just a few years, the present aggressive panorama has shortly compounded our challenges, that are reaching a crucial level,” the report says.
About 200,000 new addresses are added in Canada yearly, including to the prices of supply, the corporate mentioned.
Earlier this yr, the corporate offered off its IT and logistics departments as a part of a metamorphosis plan to avoid wasting the beleaguered nationwide mail service.
It additionally has spent closely on new processing capability for bundle supply, upgraded its services and tried to enhance customer support.
“Canada Publish is dedicated to main that change, constructing on the enhancements we have made throughout the group over the previous few years,” the corporate’s president Doug Ettinger mentioned in a information launch.
The Canadian Union of Postal Employees (CUPW), which represents 60,000 workers, didn’t reply to CBC’s request for remark.
