Canada Post has reported a massive second-quarter loss of $378 million due to the COVID-19 pandemic.
The Crown corporation, which is largely funded through postage paid by customers, said it saw unprecedented growth in parcel volumes and revenue from Canadians shopping online while sheltering in place at home, delivering as much during the second quarter as the postal service does during the peak Christmas season.
But mail and direct marketing revenues dropped faster with businesses mailing and advertising less than they did pre-pandemic. Traditional mail revenue dropped by 15.4% in the second quarter compared to the same period of 2019, while year-over-year direct marketing revenue fell by 46.4% in the second quarter.
Canada Post estimates COVID-19 led to a revenue shortfall of $46 million, and increased costs by $118 million. The postal service has now recorded a before-tax loss of $444 million through the first half of 2020, compared to a loss of $27 million during the same period last year.
Revenues over the second quarter of 2020 totaled $3.3 billion. Canada Post said in a news release that it would have incurred a loss even without the impact of the pandemic, as pay increases for employees under new collective agreements went into effect.
