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USPS Financial Update and a Plan for Our Future (Here to Serve Our Customers)

USPS Financial Update and a Plan for Our Future (Here to Serve Our Customers). October 13, 2011 Joe Corbett. August 2011 Preliminary Financial Results. Preliminary Financial Results. * Before RHB Pre-Funding, Non-Cash Adjustments to Workers’ Compensation Liabilities & Contingent Liabilities.

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USPS Financial Update and a Plan for Our Future (Here to Serve Our Customers)

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  1. USPS Financial Update and a Plan for Our Future(Here to Serve Our Customers) October 13, 2011 Joe Corbett

  2. August 2011 Preliminary Financial Results

  3. Preliminary Financial Results * Before RHB Pre-Funding, Non-Cash Adjustments to Workers’ Compensation Liabilities & Contingent Liabilities

  4. Preliminary Financial Results * Before RHB Pre-Funding, Non-Cash Adjustments to Workers’ Compensation Liabilities & Contingent Liabilities

  5. Preliminary Revenue11 Months Ended August 31, 2011 ($ Billions) $2.1 $0.5 $0.5 $0.2

  6. Preliminary Financial Results * Before RHB Pre-Funding, Non-Cash Adjustments to Workers’ Compensation Liabilities & Contingent Liabilities

  7. Workhour Changes August YTD – FY 2011 163.3M 153.8B 138.2M 366.4M 133.5M 1055.4M 197.7M 54.3M August YTD Reduction = 31.3M hours

  8. Preliminary Financial Results * Before RHB Pre-Funding, Non-Cash Adjustments to Workers’ Compensation Liabilities & Contingent Liabilities

  9. Preliminary Financial Results * Before RHB Pre-Funding, Non-Cash Adjustments to Workers’ Compensation Liabilities & Contingent Liabilities

  10. USPS Financial Future

  11. Plan to Profitability Revenue Declines $ in Billions Relentless First-Class Mail Migration Total Revenue

  12. Additional Actions Neededto Reduce Cost $ in Billions 2011-2020 Cumulative Losses of $154B Current Expense Outlook Total Revenue

  13. Aggressive Cost Reduction Needed $ in Billions 2011-2020 Cumulative Losses of $154B Current Expense Outlook $20B Shortfall in FY2015 Total Revenue $20B USPS Plan to Cut Expenses by FY2015

  14. Postal Plan to Profitability$20B Cost Eliminated by FY2015 $20B Total

  15. Network Optimization Future Network

  16. Potential Decrease in Processing Facilities Through 2013 Processing Facilities

  17. Possible Legislative Paths Current State of Play • President’s Plan on Deficit Reduction stabilizes USPS finances for next several years • USPS supports because it gives USPS sufficient operating cash for next two years • USPS recommends adoption of USPS Health Care Program • House Continuing Resolution: Defers Retiree Health Benefit payment until November 18 • Divergent House and Senate postal legislation

  18. President's Plan for the USPS Restructure retiree health benefit pre-funding to reduce near-term postal payments Provide USPS w/ refund over two years of $6.9 billion surplus contributed to Federal Employee Retirement System Reduce USPS operating costs by giving USPS authority to reduce mail delivery from 6 to 5 days Allow USPS to increase collaboration w/ state and local governments; e.g. non-postal products and to mail beer and wine Allows USPS ability to raise postage rates above current price cap USPS Supports President's Plan for USPS Reform

  19. Here to Serve Our Customers

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