1. Richard J. Strasser, Jr. Chief Financial Officer & Executive Vice President Richard J. Strasser, Jr. Chief Financial Officer & Executive Vice President

2. FINANCIAL UPDATE  Revenue below Plan  Expenses below Plan  Net Income under Plan Summary Outlook ($296M) ($119M) ($177M) Quarter III, FY 2003 (Feb 22 – May 16, 2003) APs 7 & 8 (Feb 22 – Apr 18)

3. FINANCIAL UPDATE $ 1,542 Net Income $ 1,909 366 43,005 -1,248 Expense 41,757 1.2 Plan Var $44,547 [-881] Actual Revenue $43,666 %SPLY 5.7 ($ Millions) [ ] = Unfavorable Variance to Plan Numbers may not add due to rounding Income Statement – YTD AP 8 (Sept 7, 2002 – April 18, 2003)

4. FINANCIAL UPDATE % SPLY PQ 1PQ 2PQ 3PQ 4 Actual Plan FY 2003 – Total Mail Volume Change APs 7&8 0.5

5. FINANCIAL UPDATE % SPLY PQ 1PQ 2PQ 3PQ 4 Actual Plan FY 2003 – First-Class Mail Volume Change -2.1 APs 7&8

6. FINANCIAL UPDATE % SPLY PQ 1PQ 2PQ 3PQ 4 Actual Plan FY 2003 – Standard Mail Volume Change APs 7&8 3.8

7. FINANCIAL UPDATE Actual Expense Growth FY 2003 – Expense Trend AP12345678

8. FINANCIAL UPDATE FY 2003 – Cumulative Work Hour Reductions (Millions) Actual Work Hour Reduction

9. FINANCIAL UPDATE -59,858 AP 8 Cumulative Career Complement Reductions

10. FINANCIAL UPDATE Percent Growth Total Factor Productivity Cumulative 1971 - 2003 *Projection * *

11. FINANCIAL UPDATE Percent Growth Output Per Work Hour Cumulative 1971 - 2003 *Projection * *

12. FINANCIAL UPDATE FY 2003 – Cumulative Net Income $0.6B $1.91B Actual ($ Billions)

13. FINANCIAL UPDATE FY 2003 – Average AP Revenue & Expense $5,551M $5,571M $5,510M $5,069M $5,281M $5,451M $5,398M $5,294M Net Inc/(Loss) $ 270M $ 120M $ 112M ($ 225M) Expense

14. FINANCIAL UPDATE Average AP Net Income (Loss) Quarter 1 $270M Quarter 2 $120M Quarter 3 $112M Quarter 4 ($225M) ($ Billions) FY 2003 – Cumulative Net Income Plan $0.6B FY 2003 – Net Income (Loss)

15. Richard J. Strasser, Jr. Chief Financial Officer & Executive Vice President Richard J. Strasser, Jr. Chief Financial Officer & Executive Vice President