Canada Post Records Tenth Consecutive Profit
April 13, 2005
In its 2004 Annual Report tabled today in Parliament, Canada Post reported its tenth consecutive year of profit for its Group of Companies. The Corporation recorded a consolidated net income of $147 million for the fiscal period ended December 31, 2004.
"Ten years of profitability is an accomplishment the management and employees of Canada Post can take great pride in," said the Honourable John McCallum, the Minister Responsible for Canada Post. "However there are many challenges facing the corporation in the coming years and now is the time to prepare to meet those challenges."
The return on equity for 2004 reached 12.1 per cent, a key milestone, triggering the commencement of an annual dividend payment at the rate of 40 per cent of net income as established in the multi-year Policy Framework. The Corporation has declared and will pay a dividend of $59 million to the Government of Canada in 2005. In 2004 Canada Post paid its shareholder a dividend of $63 million.
"The financial success achieved by the Corporation has provided a solid foundation for future growth," said Gordon Feeney, Chairman of the Board of Directors. "However, there are major challenges ahead brought on by rapid technological change. As the pace of electronic substitution continues to erode traditional Lettermail volumes, it is clear that strategies must be revised to bring new product offerings to the marketplace."
Canada Post's consolidated net income of $147 million was a decrease of
$106 million from 2003 and the cost of operations increased by $251 million
or 4.1 per cent from the comparative period.
Consolidated revenues reached $6.7 billion, an increase of 5 per cent or
$307 million over the comparative period a year ago. The population growth added some 240,000 new points of delivery and between $20 million and
$30 million to the cost of providing postal services in 2004.
On a consolidated basis, Canada Post Corporation processed 10.9 billion pieces during the 12-month period. An on-time service performance score of 96.8% for Lettermail was achieved against the target of 96%.
Anne Joynt, President and Chief Executive Officer for Canada Post said, "I want to thank our employees for yet another job well done. But we can't stand on our laurels. The reality is that Lettermail volumes are declining, points of delivery are increasing, distribution growth is limited by aggressive global competition and our letter rate increases are limited to two-thirds of inflation. As we move forward, we need to find more cost reductions and create new and relevant products."
Canada Post's vision is to be a world leader in providing innovative physical and electronic delivery solutions, creating value for its customers, employees and all Canadians.
Highlights of the 2004 Annual Report
Canada Post's Annual Report is available at www.canadapost.ca
For further information, contact: