Canada Post says it’s burning through $1B loan, expects to run out of cash by year-end

Canada Post says it will need another bailout by early 2026 after burning through a $1-billion federal loan amid record losses and ongoing strike disruptions.

After starting the year with a $1-billion federal loan, Canada Post said it will need another bailout by early 2026 as the Crown corporation bleeds cash, putting it on track for its worst fiscal year yet.

It reported the highest quarterly loss in its history Friday, as the beleaguered mail service contends with stiff competition for parcel delivery and disruptions from an ongoing labour dispute.

The loan of $1.03 billion from Ottawa in January “was meant to carry the corporation through the government of Canada’s fiscal year ending March 31, 2026,” it said in its quarterly report.

But now it expects that money to be “fully utilized” by Dec. 31 because of the hit to revenues from ongoing strike action by its 55,000 mail carriers.

“The corporation will need to access short-term financing facilities or other measures to maintain solvency and support operations over the next 12 months,” it said.

The organization lost $541 million before taxes in its third quarter. The “unprecedented” losses ballooned 72 per cent from $315 million in the same quarter a year earlier, it said.

“Canada Post’s financial situation continued to deteriorate in the third quarter,” it said in a release. “Ongoing strike activity and uncertainty continued to drive customers to competitors for their deliveries.”

Revenue from parcels — its most lucrative segment last year — fell 40 per cent to $450 million amid a volume decline of 27 million pieces.