– The U.S. Postal Service on Friday reported a net loss of $1.5 billion during the first three months of this year, noting that while more people are using its shipping and package services, it’s costly to do and other revenues have declined.

The Postal Service is an independent agency that receives no tax dollars for its day-to-day operations but is subject to congressional control. It has asked to end most Saturday deliveries, a request that was blocked by Congress.

According to its latest financial statement, which covers Jan. 1 through March 31, the Postal Service sent 420 million fewer pieces of mail compared with the same period last year. First-class mail fell by 2.1 percent and standard mail by 1.1 percent. But a 14.4 percent increase in shipping and package volume contributed to a slight uptick — 1.3 percent — in operating revenue.

That $223 million increase in operating revenue, however, was tempered by high operating expenses. The Postal Service said it found some relief because of a decline in workers’ compensation costs. But it said it’s still dealing with “higher compensation costs from growth in the labor-intensive shipping and package business, as well as higher retirement contribution rates” mandated by the government.

“Shipping and package services are a key business driver. However, operating margins in this business are lower than in mailing services,” said Joseph Corbett, Postal Service chief financial officer. “While we’re pleased to see a small increase in controllable income, to improve our margins, we’ll need to make investments in our network infrastructure and delivery vehicles.”

The National Association of Letter Carriers said the figures show that the Postal Service is turning itself around.

Associated Press