® USPS Financial Update Mailer’s Technical Advisory Committee Meeting May 19, 2010 Joe Corbett Chief Financial Officer & Executive Vice President

® Economy Crude Oil Dow Jones

3 Financial Results ($ in Billions) 0.3(1.9)($1.6) Net Loss (0.6) Expense (0.2)16.9$16.7 Revenue (1) ($ Chg) (3.8) (1.4) (% Chg) Three Months Ended March 31, Retiree Health Bfts Volume (Pieces) (2) -3.3% (1) Includes $180 Million in Census Revenue for Qtr II 2010 period. (2) Includes 486 Million pieces in Census Volume for Qtr II 2010 period.

4 Total Mail Volume 8 Quarter Moving Average Growth Rates % SPLY FY 2007FY 2008 FY 2009 FY 2010

5 First-Class Mail Volume 8 Quarter Moving Average Growth Rates % SPLY FY 2007FY 2008FY 2009 FY 2010

6 Standard Mail Volume 8 Quarter Moving Average Growth Rates % SPLY FY 2007FY 2008FY 2009FY 2010

7 1. Reduce Workhours Reduction of 22,000 employees Oct/Nov Goal – approx. 90,000 workhours 2.Day-to-Day Management ●Efficiency – Productivity and Overtime ●Service Performance – All Categories 3.Variance & Staffing Modeling ●Mail Processing ●Customer Service ●People Repositioning 4.Implement National Programs a)Network Distribution Center Accelerated b)Area Mail Processing Implementation c)Route Adjustment Process d)Flat Sorter Sequencing Implementation e)All Areas – Costs Down Across the Postal Service Focus on Cost

8 1.Reduce Workhours Reduction of 22,000 employees Oct/Nov Goal – approx. 90,000 workhours 2.Day-to-Day Management Efficiency – Productivity and Overtime Service Performance – All Categories 3.Variance & Staffing Modeling ●Mail Processing ●Customer Service ●People Repositioning 4.Implement National Programs a)Network Distribution Center Accelerated b)Area Mail Processing Implementation c)Route Adjustment Process d)Flat Sorter Sequencing Implementation e)All Areas – Costs Down Across the Postal Service Focus on Cost

9 1.Reduce Workhours Reduction of 22,000 employees Oct/Nov Goal – approx. 90,000 workhours 2.Day-to-Day Management ●Efficiency – Productivity and Overtime ●Service Performance – All Categories 3.Variance & Staffing Modeling Mail Processing Customer Service People Repositioning 4.Implement National Programs a)Network Distribution Center Accelerated b)Area Mail Processing Implementation c)Route Adjustment Process d)Flat Sorter Sequencing Implementation e)All Areas – Costs Down Across the Postal Service Focus on Cost

10 1.Reduce Workhours Reduction of 22,000 employees Oct/Nov Goal – approx. 90,000 workhours 2.Day-to-Day Management ●Efficiency – Productivity and Overtime ●Service Performance – All Categories 3.Variance & Staffing Modeling ●Mail Processing ●Customer Service ●People Repositioning 4.Implement National Programs a) Network Distribution Center Accelerated b) Area Mail Processing Implementation c) Route Adjustment Process d) Flat Sorter Sequencing Implementation e) All Areas – Costs Down Across the Postal Service Focus on Cost

11 Workhours 88.1B 117M 82M 206M 87M 106M 598M 49M Workhours Below SPLY Six Months Ended March 31, 2010

12 Financial Results ($ in Billions) 0.4(2.3)($1.9) Net Loss (1.4) Expense (0.9)36.0$35.1 Revenue (1) ($ Chg) (4.5) (2.7) (% Chg) Six Months Ended March 31, Volume (Pieces) (2) -6.3% (1) Includes $180 Million in Census Revenue for Qtr II YTD 2010 period. (2) Includes 486 Million pieces in Census Volume for Qtr II YTD 2010 period. Retiree Health Bfts

® USPS Financial Update Mailer’s Technical Advisory Committee Meeting May 19, 2010 Joe Corbett Chief Financial Officer & Executive Vice President