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Post Office Loss Declines in Third Quarter

August 9, 2013 by

Over all, the post office reported operating revenues of $16.2 billion in the third quarter, which ended June 30, compared with $15.6 billion over the same period last year, a 3.6 percent increase. It attributed the increase to cost-cutting measures and strong growth in e-commerce deliveries.

Postal officials said the service’s expenses were $16.9 billion, compared with $20.8 billion over the same time last year. Expenses were lowered by a $918 million decrease in workers’ compensation costs because of lower interest rates.

“The Postal Service’s latest quarterly report makes clear that Postal Service finances are rebounding strongly as the U.S. economy improves,” said Fredric V. Rolando, president of the National Association of Letter Carriers. He said that the post office would have made a profit of $660 million without the health fund payments required by Congress.

Mail volume continues to fall, but not as sharply as in the past. Total volume for the quarter was 37.9 billion pieces, compared with 38.3 billion over the same period last year. The volume of first-class mail, the largest revenue source for the post office, declined about 3.4 percent. Revenues generated by first-class mail were about $6.9 billion, down about 1 percent, or $60 million, from the same period last year.

Revenue from advertising mail — many call it junk mail — increased by $117 million, or 3 percent, compared with the same period a year earlier. Revenue from package deliveries also continued to grow. Revenue was $2.9 billion, up $237 million, or 8.8 percent, over last year.

Despite a somewhat better financial picture, the post office said it continued to suffer from the 2006 Congressional mandate that requires it to pay $5.5 billion annually into a health fund for future retirees.

The service defaulted on two payments last year for the first time and said it would not be able to make payments into the fund this year.

To increase revenues, postal officials have asked Congress for the authority to enter into new lines of business like beer and wine delivery, which are now forbidden. It has also asked Congress to change the mandate for the retirees’ health fund.

Congress has recently began working on a postal overhaul bill after similar legislation failed last year. The Senate passed its version of the bill last year, but a House measure never made it out of committee.

Last month, a House committee passed a bill that would allow the post office to phase out letter delivery on Saturday, but six-day delivery would continue for packages and medicine. The bill would also end delivery to individual homes in favor of cluster boxes. It would also forgive the two health fund payments the post office missed last year, but would not end the payments. The Senate has not begun work on its version of the postal overhaul.

“We are encouraged that comprehensive postal reform legislation has started making its way through the legislative process in both the House and Senate,” Patrick R. Donahoe, the postmaster general, said.

Article source: http://www.nytimes.com/2013/08/10/us/post-office-loss-declines-in-third-quarter.html?partner=rss&emc=rss

Filed Under: Economy News Tagged With: , ,

DealBook: Credit Agricole Hit by $3.7 Billion Charge on Earnings

February 1, 2013 by Leave a Comment

Paris, the 01 february 2013

Crédit Agricole S.A. records a goodwill impairment charge in its financial statements for the fourth quarter of 2012 to be published on 20 February 2013, with no impact on its solvency or liquidity

These measures do not involve any cash outflows and do not affect the strength of the Group

As part of the process of preparing its consolidated financial statements, Crédit Agricole S.A. has carried out impairment tests on the goodwill carried on its balance sheet. In accordance with IFRS standards, these tests are based on the comparison between the amounts of goodwill on Crédit Agricole S.A.’s books and the values in use of the relevant assets. The calculation of value in use is based on discounted cash flows.

These accounting charges primarily reflect the impact of tighter regulatory requirements, hence the reduction of the value in use of the relevant entities. They also reflect the present macro-economic and financial environment in the relevant countries and business lines.

The net impairment charge, Group share, recognised in the consolidated financial statements for the fourth quarter of 2012 amounts to 2,676 million euros, broken down as follows:

  • Corporate and Investment Banking                                           466 million euros
  • Brokerage (Newedge)                                                             366 million euros
  • Consumer finance                                                                  923 million euros
  • International retail and banking                                                921 million euros
    of which retail banking in Italy                                                 852 million euros

In addition, the value of the bank’s 20.2% interest in BES has been written down by 267 million euros.

These impairment charges have a negative impact of the same amount on Crédit Agricole S.A.’s net income Group share for the fourth quarter of 2012, but do not affect either its solvency or its liquidity as goodwill is already fully deducted in the calculation of solvency ratios. They do not affect Crédit Agricole S.A.’s cash position, as related disbursements were made at the time of the acquisition of the relevant companies.

Furthermore, Crédit Agricole S.A. announces that other non-operating items affect its financial statements for the fourth quarter of 2012. First, a negative impact on revenues of about 850 million euros has been recognised on the revaluation of its own debt due to the improvement of funding conditions during the quarter. Secondly, a tax expense of around 130 million euros has been recognised in relation to the exceptional 7% tax on the capitalisation reserve of the Group’s insurance companies.

Lastly, as announced in its press release of 25 January 2013, Crédit Agricole S.A. reiterates that the impairment of the carrying value of SAS Rue La Boétie shares in the consolidated financial statements of the Regional Banks has an impact of some 160 million euros on their contribution to Crédit Agricole S.A.’s consolidated income.

Article source: http://dealbook.nytimes.com/2013/02/01/credit-agricole-hit-by-3-7-billion-charge-on-earnings/?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Chinese Economy Picks Up Steam in Last Quarter

January 17, 2013 by Leave a Comment

HONG KONG — The giant Chinese economy picked up some steam during the last few months of 2012, closely watched data from Beijing on Friday confirmed. But at the same time the figures underlined the view that the pace of future growth is likely to remain well below that seen in recent years.

China’s gross domestic product expanded 7.9 percent during the final quarter of last year, compared to a year earlier — slightly better than expectations, and significantly above the 7.4 percent pace recorded during the previous quarter.

Separate data for the month of December also came in a touch better than analysts had forecast: Retail sales expanded 15.2 percent from a year earlier, and industrial output grew 10.3 percent. Both figures were slightly better than those recorded in November, and helped lift stock markets in mainland China and Hong Kong on Friday.

China’s mild re-acceleration has been helped by a gradual recovery in overseas demand for Chinese-made goods in recent months, as well as a string of economic stimulus measures that helped dissipate earlier concerns that China might be headed for a “hard landing” during 2012.

At the same time however, the batch of data released by the Chinese statistics bureau on Friday also underlined that China’s once red-hot economy has now settled into a much lower pace of expansion.

The head of the statistics authority, Ma Jiantang, acknowledged as much at a press conference in Beijing: “I think you could use these two sentences to give a relatively concise assessment of economic performance in 2012,” he said. “First, national economic performance maintained stability while slowing; second, economic and social development made advances while maintaining stability.”

Annual expansion has slowed to around 8 percent — the pace for 2012 was 7.8 percent, according to Friday’s data, and many analysts expect a similar or slightly better pace for 2013 — far below the double-digit rates it enjoyed in the past.

Moreover, analysts believe the pace is likely to slow even further over the coming decade as the authorities pursue a shift towards higher-quality growth, and grapple with the gradual aging of the country’s population.

Friday’s data confirmed “that the worst is probably over for the economy and that China has avoided a hard landing. But it is quite a narrow escape,” commented Xianfang Ren, an economist at IHS Global Insight in Beijing, in a note. “The economy will likely be wiggling within quite a narrow band of growth rates in 2013, as the upside pull only marginally outweighs the downside drag.”

Chris Buckley contributed reporting.

Article source: http://www.nytimes.com/2013/01/19/business/global/chinese-economy-picks-up-steam-in-last-quarter.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,