Australia Post has reported a loss of $200 million. 

The figure marks a historic turning point, representing the first major structural loss in over three decades. 

The company warns that unless there are substantial cuts in services by the federal government, these losses are poised to persist.

Despite the parcel segment experiencing steady growth, losses in the letter division have soared by more than 50 per cent, reaching $384 million. 

The estimated expenses for fulfilling Australia Post's community service obligations have surged to $442 million, a 27 per cent increase from the previous year.

While revenue from parcels and services has held steady at $7.3 billion, the letter sector continues to decline, with volumes dropping by 7.8 per cent from the previous year. 

This year-end loss of $200.3 million, a stark contrast to the $55.3 million profit posted the prior year, is only the second annual loss since Australia Post's transition into a self-funded government business enterprise in 1989.

Australia Post's Chief Executive, Paul Graham, has issued a stark warning, asserting that further losses are inevitable unless significant changes occur. 

“If we do everything in our power to run this business well and we get a favourable regulatory response towards modernisation, I’m confident that Australia Post will return to profit. Without this support, the FY23 loss will be followed by many more,” he said on Thursday.

Australia Post is actively pressing the federal government, its sole owner, for a political commitment to implement changes such as reducing letter frequency and closing certain full-service post offices in metropolitan areas. 

The changing landscape of communication is evident, with the average Australian household receiving only 2.2 addressed letters weekly, down from 8.5 per week in 2008. 

This figure is projected to nearly halve over the next five years, according to Post's predictions.

Furthermore, Post Offices face mounting challenges, with over-the-counter transactions declining by 21 per cent. 

The corporate Post Office network is also grappling with increasing losses as foot traffic dwindles. 

Total expenses have climbed by 2.7 per cent to $9.1 billion, driven by rising costs in fuel, energy, and labour. 

However, Australia Post claims to have saved $237 million by streamlining its support office structures.