Canada Post reports $41-million loss before tax in first quarter
Transaction Mail benefits from one-time provincial election mailings as Parcels results slump due to lasting impacts of the labour disruption
OTTAWA, ON, May 28, 2025 /CNW/ - Canada Post recorded a loss before tax of $41 million in the first quarter of 2025 as Parcels results declined significantly and Transaction Mail and Direct Marketing revenue grew.
The segment's $41-million loss before tax in the first quarter improved by $35 million compared to a loss before tax of $76 million in the first quarter of the prior year. Canada Post's revenue increased by $42 million, or 4.0 per cent,¹ in the first quarter compared to the same period of 2024.
While results temporarily improved in the first quarter, Canada Post continues to confront significant challenges. The company recently reported a 2024 loss before tax of $841 million – the seventh consecutive annual loss for the Corporation. From 2018 to 2024, the Corporation lost more than $3.8 billion before taxes.
In the first quarter of 2025, the impacts of the 2024 labour disruption continued to weigh heavily on Parcels volumes and revenue, as many customers that had turned to other carriers for their shipments have not yet returned to Canada Post – a financial impact that is expected to last well into 2025 and beyond. Canada Post continued to be without new collective agreements with the Canadian Union of Postal Workers (CUPW) in the first quarter, creating ongoing uncertainty for customers.
While Transaction Mail continues to erode more broadly, the line of business benefitted from election mailings in the first quarter, as well as a one-time volume surge that followed the strike at the end of 2024. Regulated postage rate increases in 2024 and 2025 also positively contributed to results. Direct Marketing experienced higher sales partly due to a resurgence of business following the labour disruption.
The cost of operations declined by $68 million, or 0.5 per cent, in the first quarter compared to the same period a year earlier. Lower parcel volumes led to a decline in transportation costs, and non-capital investments decreased as the company has continued to refocus its investment priorities.
To ensure the company could remain solvent and continue operating, the Government of Canada announced in early 2025 it would make available to Canada Post up to $1.034 billion of repayable funding during the government's fiscal year ending March 31, 2026. While the repayable funding ensures the continuity of postal services and stability for the workers who depend on their pay and benefits, it will not solve Canada Post's structural issues.
Parcels
For the first quarter of 2025, Parcels revenue declined by $194 million, or 22.9 per cent, while volumes fell by 18 million pieces, or 25.8 per cent, compared to the same period in 2024. The labour disruption at the end of 2024 continued to weigh on the line of business, as the shut down of operations pushed parcel volumes to flexible, low-cost delivery providers. The volumes are a challenge to win back from carriers with competitive offers and pricing, and many customers have not yet returned to Canada Post. In the first quarter, the 2024 strike and labour uncertainty continued to impact all channels (domestic, inbound and outbound).
Transaction Mail
In the first quarter, Transaction Mail revenue rose by $223 million, or 36.7 per cent, as volumes increased by 42 million pieces, or 8.6 per cent, compared to the same period a year earlier. While Transaction Mail continues to be in secular decline, the line of business benefitted from election mailings in the first quarter, as well as a one-time volume surge that followed the strike at the end of 2024. The company's May 2024 and January 2025 regulated postage rate increases also helped improve revenue for the line of business.
Direct Marketing
In the first quarter, Direct Marketing revenue grew by $11 million, or 5.8 per cent, as volumes increased by 69 million pieces, or 8.3 per cent, compared to the same period in 2024. Strong sales for the Canada Post Neighbourhood Mail™ service positively impacted results, as well as a general resurgence in business following the 2024 labour disruption that shut down operations.
Canada Post Group of Companies²
On January 31, 2025, Purolator Holdings Ltd. acquired 100 per cent of the shares of international trade-services firm Livingston International, which specializes in customs brokerage, global freight forwarding and trade consulting. The acquisition supports Purolator's strategy to expand its international capabilities, enhance its competitiveness, and position Purolator as a Canadian-owned leader in the domestic and international freight, package and logistics market.
Livingston results were consolidated from the acquisition date and impact the year-over-year comparisons for the Group of Companies and the Purolator segment.
The Group of Companies recorded a loss before tax of $102 million in the first quarter, compared to a profit before tax of $106 million in the same period a year earlier. The loss by the Canada Post segment weighed on results for the Group of Companies. Purolator recorded a profit before tax of $19 million in the quarter, compared to $39 million in the same period of 2024.
Background
The Canada Post Group of Companies' operations are funded by revenue generated by the sale of its products and services, not taxpayer dollars.
1. | All percentages in this news release are calculated on values rounded to the nearest thousand; they are also adjusted for differences in business and paid days between the comparison periods. In the first quarter of 2025, Canada Post and the Group of Companies had one less business day, and two fewer paid days, compared to the same period of 2024. Fewer business days result in a decrease in revenue and volume, while fewer paid days result in lower costs. |
2. | The Canada Post Group of Companies consists of the core Canada Post segment and its non-wholly owned subsidiary Purolator Holdings Ltd. |
TM Trademark of Canada Post Corporation.
SOURCE Canada Post