Pitney Bowes Announces Fourth Quarter and Annual Results for 2012 Business Wire STAMFORD, Conn. -- January 31, 2013 Pitney Bowes Inc. (NYSE: PBI) today reported financial results for the fourth quarter and full year 2012. Highlights *Fourth quarter revenue of $1.3 billion; Adjusted EPS of $0.56; GAAP EPS of $0.55. *Year-over-year revenue growth in Management Services; first since 2008. *Year-over-year revenue growth in International Mailing, Software and Mail Services. *Revenue trends continue to improve in the SMB group. *Full year revenue of $4.9 billion; Adjusted EPS of $2.18, which includes a first quarter $0.11 per share tax benefit; GAAP EPS of $2.21. *Full year free cash flow of $769 million. *Results reflect International Mail Services (IMS) as a discontinued operation. *The Board of Directors approved a first quarter 2013 dividend of $0.375 per share for the Company’s common stock. President and Chief Executive Officer, Marc Lautenbach, commented, “In my brief tenure here, I have been impressed by the Company’s assets and our opportunities to deliver long-term value to shareholders and customers. I am working with the management team to develop strategies for driving growth and on-going profitability as the Company continues to transform.” Fourth Quarter 2012 Results Revenue in the fourth quarter totaled $1.3 billion, a decline of one percent compared to the prior year period, on both a reported and constant currency basis. The year-over-year revenue comparison this quarter is an improvement in the revenue trends as a result of growth in four of the business segments. Earnings per diluted share (EPS), as reported under Generally Accepted Accounting Principles (GAAP), for the fourth quarter were $0.55, which includes a net charge of $0.07 per share for restructuring. GAAP earnings per share also include income of $0.06 per share from discontinued operations, which is the net of $0.07 per share of income from the resolution of tax matters and a loss of less than $0.02 per share associated with the expected sale of the International Mail Services (IMS) business. GAAP EPS for the fourth quarter 2011 were $1.28, which included charges totaling $0.72 per share for goodwill, restructuring and asset impairments, as well as income of $1.03 per share in discontinued operations, which was primarily related to a net tax benefit from the resolution of tax matters. Adjusted earnings per diluted share from continuing operations for the fourth quarter of 2012 and 2011 exclude any goodwill, restructuring and asset impairment charges. For the fourth quarter 2012, adjusted EPS were $0.56 per share, as compared with $0.98 in the same period in the 2011. In comparison, 2011 fourth quarter adjusted EPS from continuing operations also included a $0.37 per share benefit related to favorable tax settlements. Excluding this tax benefit, the comparable 2011 fourth quarter adjusted EPS from continuing operations were $0.61 per share. Full Year 2012 Results For the full year, revenue totaled $4.9 billion, a decline of 4 percent compared with the prior year on a reported basis and a decline of 3 percent excluding the impact of currency fluctuations. Earnings per diluted share on a GAAP basis for 2012 were $2.21, which includes $0.08 per share net charge for restructuring, as well as a net benefit of $0.06 per share from the sale of leveraged lease assets. GAAP earnings per share also include income of $0.05 per share from discontinued operations, which is the net of $0.17 per share of income from the resolution of tax matters and a loss of $0.12 per share associated with the IMS business. GAAP EPS for 2011 were $3.05 per share, which included charges totaling $0.89 per share for goodwill, restructuring and asset impairments; a tax charge in continuing operations of $0.02 per share; a net benefit of $0.13 per share related to the sale of leveraged lease assets; as well as income in discontinued operations of $1.07 per share which was the net of $1.31 per share of income from the resolution of tax matters primarily related to the former Capital Services business and a loss of $0.24 per share associated with IMS. Adjusted EPS per diluted share from continuing operations exclude goodwill, restructuring and asset impairment charges; the net benefit from the sale of leveraged lease assets; and net tax charges. For 2012 adjusted EPS were $2.18 per share, which includes a first quarter $0.11 per share net tax benefit. 2011 adjusted EPS per diluted share from continuing operations were $2.75 per share, which included a $0.44 per share net tax benefit. Excluding these benefits in adjusted EPS, comparable adjusted EPS from continuing operations for 2012 were $2.07 per share versus $2.31 per share for 2011. The Company’s results for the quarter and the year are summarized in the table below: Earnings Per Share Reconciliation* Q4 2012 Q4 2011 FY 2012 FY 2011 Adjusted EPS from continuing $0.56 $0.61 $2.07 $2.31 operations before net tax benefit Net tax benefit - $0.37 $0.11 $0.44 Adjusted EPS from continuing $0.56 $0.98 $2.18 $2.75 operations Restructuring and asset ($0.07) ($0.31) ($0.08) ($0.48) impairments Goodwill charge - ($0.41) - ($0.41) Tax charge - - - ($0.02) Sale of leveraged lease assets - - $0.06 $0.13 GAAP EPS from continuing $0.49 $0.25 $2.16 $1.98 operations Discontinued operations – income $0.06 $1.03 $0.05 $1.07 (loss) GAAP EPS $0.55 $1.28 $2.21 $3.05 *2012 and 2011 results reflect the International Mail Services (IMS) business as a discontinued operation. The sum of the earnings per share may not equal the totals above due to rounding. Free Cash Flow Results Free cash flow during the quarter was $253 million and $769 million for the year. On a GAAP basis, the Company generated $256 million in cash from operations for the quarter and $660 million for the year. During the fourth quarter, the Company used cash to pay $84 million in dividends. For the year, the Company has used its cash primarily to reduce debt, pay dividends, contribute to its pension plans and make restructuring payments. Business Segment Results SMB Solutions Group 4Q 2012 Y-O-Y Change Change ex Currency Revenue $644 million (3%) (3%) EBIT $200 million (9%) Within the SMB Solutions Group: North America Mailing 4Q 2012 Y-O-Y Change Change ex Currency Revenue $456 million (6%) (6%) EBIT $174 million (11%) During the quarter, North America Mailing revenue was impacted by lower recurring revenue streams, although at a slower rate than previous quarters. Equipment sales revenue for the segment declined 3 percent, which is a continuation of the year-over-year improvement in trend, in part due to increased placements of SendSuiteLive™ shipping solutions in the U.S. and growth in equipment sales in Canada. Additionally, meter placements in Canada continued to grow for the second consecutive quarter. EBIT margin for the segment declined versus the prior year as a result of fewer lease extensions on existing equipment and the decline in higher margin recurring revenue streams. International Mailing 4Q 2012 Y-O-Y Change Change ex Currency Revenue $188 million 3% 4% EBIT $ 26 million 10% International Mailing revenue benefited from increased equipment sales in the Nordics. Revenue also benefited from increased placements of Connect+™ mailing systems, particularly in France where it was recently launched, offset by the impact of the overall economic environment in Europe. EBIT margin improved year-over-year primarily due to improved service margins and productivity initiatives. Enterprise Business Solutions Group 4Q 2012 Y-O-Y Change Change ex Currency Revenue $643 million 1% 1% EBIT $ 77 million (9%) Within the Enterprise Business Solutions Group: Worldwide Production Mail 4Q 2012 Y-O-Y Change Change ex Currency Revenue $152 million (6%) (6%) EBIT $ 14 million (30%) Production Mail revenue experienced a significant increase in the backlog of orders, especially in North America, as the outlook improved and some larger orders were written at the end of the year. These orders are expected to have a positive impact on revenue in future periods. However, revenue in the fourth quarter was negatively impacted due to global economic uncertainty experienced earlier in the year and the comparison against a strong quarter last year. EBIT margin declined when compared to the prior year due to lower revenue, the mix of equipment sales and continued investment in Volly™. Excluding the investment in Volly, EBIT margin would have been approximately 510 basis points higher this quarter. Software 4Q 2012 Y-O-Y Change Change ex Currency Revenue $105 million 2% 2% EBIT $ 18 million 172% Software revenue increased versus the prior year in part due to the growth in large licensing deals, particularly in the Americas. However, there continued to be weakness in the European and Asian markets because of ongoing economic uncertainty and continued austerity measures in the public sector. EBIT margin increased versus the prior year due to revenue growth and the benefits of productivity initiatives. Management Services 4Q 2012 Y-O-Y Change Change ex Currency Revenue $242 million 5% 5% EBIT $ 19 million 11% Management Services revenue improved year-over-year for the first time since 2008 as a result of positive net new written business in prior quarters and an increased volume of documents processed in the quarter. There continued to be positive net new written business this quarter, which is expected to drive recurring revenue growth in future periods. EBIT margin benefited from revenue growth and continued expense management. Mail Services 4Q 2012 Y-O-Y Change Change ex Currency Revenue $113 million 3% 2% EBIT $ 20 million (43%) Mail Services revenue improved in the fourth quarter as a result of continued penetration in workshare discount categories, as well as increased co-transportation of mail for customers. Revenue also benefited from an increase in the use of the Company’s ecommerce solutions for cross-border package delivery. EBIT margin comparisons with the prior year were impacted by a $9 million insurance reimbursement in the fourth quarter of last year. EBIT margin this quarter was also affected by the start-up investment in the Company’s new ecommerce offering. Excluding prior year’s insurance reimbursement, the underlying EBIT margin for the presort business continued to be in line with prior year. Marketing Services 4Q 2012 Y-O-Y Change Change ex Currency Revenue $ 32 million (5%) (5%) EBIT $ 6 million (1%) Marketing Services revenue declined in part due to lower household move volumes during the quarter, while the EBIT margin improved due to lower print production costs and ongoing productivity initiatives. Executive Vice President and Chief Financial Officer, Michael Monahan, commented, “During the quarter, the Company continued to invest in several growth initiatives, including ecommerce and Volly, which are expected to help drive future revenue. We remain focused on our cost structure to support the changing mix of our business and to gain leverage as revenue improves. The Company will continue to take actions, as necessary, to reduce costs and make the appropriate investments in the business to drive shareholder returns.” 2013 Annual Guidance This guidance discusses future results which are inherently subject to unforeseen risks and developments. As such, discussions about the business outlook should be read in the context of an uncertain future, as well as the risk factors identified in the safe harbor language at the end of this release and as more fully outlined in the Company's 2011 Form 10-K Annual Report and other reports filed with the Securities and Exchange Commission. In 2013, the Company expects revenue growth in its Enterprise Solutions Group and a moderation in the decline of revenue in its SMB Solutions Group. Revenue in 2013 is expected to benefit from growth in the Company’s new ecommerce, print outsourcing and software solutions. The Company also expects revenue to benefit from improving trends in equipment sales, including increased placements of Connect+ and SendSuiteLive; as well as a moderation in the decline of its recurring revenue streams. The Company expects that the economic and postal environments will not improve or deteriorate significantly in 2013 as compared to 2012. The Company’s 2013 guidance is as follows: *Revenue, excluding the impacts of currency, to be in the range of flat to 3 percent growth when compared to 2012; *GAAP earnings per diluted share from continuing operations to be in the range of $1.85 to $2.00, which excludes any unusual items that may occur during the year; *Free cash flow to be in the range of $600 million to $700 million. The Company expects that it will make continued investments in its growth initiatives that will result in higher expenses in the first half of the year, but are anticipated to lead to greater revenue and margin contribution in the second half of the year. Additionally, it is expected that the decline in recurring revenue streams will continue to moderate and will have less of an impact on revenue and earnings in the second half of the year. Conference Call and Webcast Management of Pitney Bowes will discuss the Company’s results in a broadcast over the Internet today at 8:00 a.m. EST. Instructions for listening to the earnings results via the Web are available on the Investor Relations page of the Company’s web site at www.pb.com. About Pitney Bowes Delivering more than 90 years of innovation, Pitney Bowes provides business communications software, mailing systems and services that integrate physical and digital communications channels. Long known for making its customers more productive, Pitney Bowes is increasingly helping other companies grow their business through advanced customer communications management. Pitney Bowes is a $5 billion company with 29,000 employees worldwide. Pitney Bowes: Every connection is a new opportunity™. www.pb.com The Company's financial results are reported in accordance with generally accepted accounting principles (GAAP). The Company uses measures such as adjusted earnings per share, adjusted income from continuing operations and free cash flow to exclude the impact of special items like restructuring charges, tax adjustments, and asset write-downs, because, while these are actual Company expenses, they can mask underlying trends associated with our business. Such items are often inconsistent in amount and frequency and as such, the adjustments allow an investor greater insight into the current underlying operating trends of the business. The use of free cash flow provides investors insight into the amount of cash that management could have available for other discretionary uses. It adjusts GAAP cash from operations for capital expenditures, as well as special items like cash used for restructuring charges, unusual tax payments and contributions to its pension funds. Management uses segment EBIT to measure profitability and performance at the segment level. EBIT is determined by deducting the related costs and expenses attributable to the segment. Segment EBIT excludes interest, taxes, general corporate expenses not allocated to a particular business segment, restructuring charges, asset impairments, and goodwill charges which are recognized on a consolidated basis. In addition, financial results are presented on a constant currency basis to exclude the impact of changes in foreign currency exchange rates since the prior period under comparison. Constant currency measures are intended to help investors better understand the underlying operational performance of the business excluding the impacts of shifts in currency exchange rates over the intervening period. Pitney Bowes has provided a quantitative reconciliation to GAAP in supplemental schedules. This information may also be found at the Company's web site www.pb.com/investorrelations. This document contains “forward-looking statements” about our expected or potential future business and financial performance. For us forward-looking statements include, but are not limited to, statements about our future revenue and earnings guidance and other statements about future events or conditions. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, but are not limited to: mail volumes; the uncertain economic environment; timely development, market acceptance and regulatory approvals, if needed, of new products; fluctuations in customer demand; changes in postal regulations; interrupted use of key information systems; management of outsourcing arrangements; foreign currency exchange rates; changes in our credit ratings; management of credit risk; changes in interest rates; the financial health of national posts; and other factors beyond our control as more fully outlined in the Company's 2011 Form 10-K Annual Report and other reports filed with the Securities and Exchange Commission. Pitney Bowes assumes no obligation to update any forward-looking statements contained in this document as a result of new information, events or developments. Note: Consolidated statements of income; revenue and EBIT by business segment; and reconciliation of GAAP to non-GAAP measures for the three months and twelve months ended December 31, 2012 and 2011, and consolidated balance sheets at December 31, 2012 and 2011 are attached. Pitney Bowes Inc. Consolidated Statements of Income (Unaudited) (Dollars in thousands, except per share data) Three months ended December Twelve months ended December 31, 31, 2012 2011 ^(2) 2012 2011 ^(2) Revenue: Equipment $ 281,772 $ 280,365 $ 938,289 $ 986,392 sales Supplies 69,815 72,246 283,604 307,974 Software 110,385 108,301 412,762 426,606 Rentals 141,445 151,926 569,619 618,990 Financing 121,435 134,311 495,130 547,269 Support 173,243 175,798 689,667 706,505 services Business 389,212 382,208 1,514,944 1,528,860 services Total revenue 1,287,307 1,305,155 4,904,015 5,122,596 Costs and expenses: Cost of equipment 149,861 132,782 459,051 449,479 sales Cost of 22,141 23,089 87,569 97,454 supplies Cost of 24,427 25,566 92,708 99,107 software Cost of 28,098 30,770 115,356 138,603 rentals Financing interest 19,755 20,783 81,140 87,698 expense Cost of support 105,750 107,815 440,055 452,582 services Cost of business 298,767 287,354 1,156,828 1,161,429 services Selling, general and 410,281 425,473 1,598,286 1,690,360 administrative Research and 32,390 40,873 136,908 148,645 development Restructuring charges and 22,291 84,087 23,117 136,548 asset impairments Goodwill - 84,500 - 84,500 impairment Other interest 27,967 29,357 115,228 115,363 expense Interest (2,189 ) (1,093 ) (7,982 ) (5,795 ) income Other income, - (9,200 ) 1,138 (19,918 ) net Total costs 1,139,539 1,282,156 4,299,402 4,636,055 and expenses Income from continuing operations 147,768 22,999 604,613 486,541 before income taxes Provision for 44,224 (32,170 ) 150,305 67,610 income taxes Income from continuing 103,544 55,169 454,308 418,931 operations Income from discontinued operations, 11,387 206,899 9,231 216,924 net of income tax Net income before attribution of 114,931 262,068 463,539 635,855 noncontrolling interests Less: Preferred stock dividends of subsidiaries attributable to noncontrolling 4,594 4,594 18,376 18,375 interests Net income - Pitney Bowes $ 110,337 $ 257,474 $ 445,163 $ 617,480 Inc. Amounts attributable to common stockholders: Income from continuing $ 98,950 $ 50,575 $ 435,932 $ 400,556 operations Income from discontinued 11,387 206,899 9,231 216,924 operations Net income - Pitney Bowes $ 110,337 $ 257,474 $ 445,163 $ 617,480 Inc. Basic earnings per share attributable to common stockholders ^(1): Continuing 0.49 0.25 2.18 1.98 operations Discontinued 0.06 1.04 0.05 1.07 operations Net income - Pitney Bowes $ 0.55 $ 1.29 $ 2.22 $ 3.06 Inc. Diluted earnings per share attributable to common stockholders ^(1): Continuing 0.49 0.25 2.16 1.98 operations Discontinued 0.06 1.03 0.05 1.07 operations Net income - Pitney Bowes $ 0.55 $ 1.28 $ 2.21 $ 3.05 Inc. ^(1) The sum of the earnings per share amounts may not equal the totals above due to rounding. ^(2) Certain prior year amounts have been reclassified to conform to the current year presentation. Pitney Bowes Inc. Consolidated Balance Sheets (Unaudited in thousands, except per share data) Assets 12/31/12 12/31/11 Current assets: Cash and cash equivalents $ 913,276 $ 856,238 Short-term investments 36,611 12,971 Accounts receivable, gross 755,218 755,485 Allowance for doubtful accounts receivable (26,968 ) (31,855 ) Accounts receivable, net 728,250 723,630 Finance receivables 1,213,776 1,296,673 Allowance for credit losses (25,484 ) (45,583 ) Finance receivables, net 1,188,292 1,251,090 Inventories 179,678 178,599 Current income taxes 51,836 102,556 Other current assets and prepayments 114,184 134,774 Total current assets 3,212,127 3,259,858 Property, plant and equipment, net 385,377 404,146 Rental property and equipment, net 241,192 258,711 Finance receivables 1,041,099 1,123,638 Allowance for credit losses (14,610 ) (17,847 ) Finance receivables, net 1,026,489 1,105,791 Investment in leveraged leases 34,546 138,271 Goodwill 2,136,138 2,147,088 Intangible assets, net 166,214 212,603 Non-current income taxes 94,434 89,992 Other assets 563,374 530,644 Total assets $ 7,859,891 $ 8,147,104 Liabilities, noncontrolling interests and stockholders' equity (deficit) Current liabilities: Accounts payable and accrued liabilities $ 1,809,226 $ 1,840,465 Current income taxes 240,681 242,972 Notes payable and current portion of 375,000 550,000 long-term obligations Advance billings 452,130 458,425 Total current liabilities 2,877,037 3,091,862 Deferred taxes on income 69,222 175,944 Tax uncertainties and other income tax 145,881 194,840 liabilities Long-term debt 3,642,375 3,683,909 Other non-current liabilities 718,375 743,165 Total liabilities 7,452,890 7,889,720 Noncontrolling interests (Preferred 296,370 296,370 stockholders' equity in subsidiaries) Stockholders' equity: Cumulative preferred stock, $50 par value, 4 4 4% convertible Cumulative preference stock, no par value, 648 659 $2.12 convertible Common stock, $1 par value 323,338 323,338 Additional paid-in-capital 223,847 240,584 Retained Earnings 4,744,802 4,600,217 Accumulated other comprehensive loss (681,213 ) (661,645 ) Treasury Stock, at cost (4,500,795 ) (4,542,143 ) Total Pitney Bowes Inc. stockholders' equity 110,631 (38,986 ) (deficit) Total liabilities, noncontrolling interests $ 7,859,891 $ 8,147,104 and stockholders' equity (deficit) Pitney Bowes Inc. Revenue and EBIT Business Segments December 31, 2012 (Unaudited) (Dollars in thousands) Three Months Ended December 31, % 2012 2011 Change Revenue North America Mailing $ 456,243 $ 482,843 (6 %) International Mailing 187,973 182,928 3 % Small & Medium Business Solutions 644,216 665,771 (3 %) Production Mail 151,775 161,888 (6 %) Software 104,550 102,481 2 % Management Services 241,880 231,378 5 % Mail Services 112,690 109,849 3 % Marketing Services 32,196 33,788 (5 %) Enterprise Business Solutions 643,091 639,384 1 % Total revenue $ 1,287,307 $ 1,305,155 (1 %) EBIT (1) North America Mailing $ 173,690 $ 195,272 (11 %) International Mailing 25,939 23,568 10 % Small & Medium Business Solutions 199,629 218,840 (9 %) Production Mail 13,716 19,591 (30 %) Software 17,823 6,564 172 % Management Services 19,012 17,065 11 % Mail Services 19,841 34,651 (43 %) Marketing Services 6,444 6,516 (1 %) Enterprise Business Solutions 76,836 84,387 (9 %) Total EBIT $ 276,465 $ 303,227 (9 %) Unallocated amounts: Interest, net (2) (45,533 ) (49,047 ) Corporate and other expenses (60,873 ) (62,594 ) Restructuring and asset impairments (22,291 ) (84,087 ) Goodwill impairment - (84,500 ) Income from continuing operations $ 147,768 $ 22,999 before income taxes Earnings before interest and taxes (EBIT) excludes general corporate (1) expenses, restructuring charges and asset impairments and goodwill impairment. (2) Interest, net includes financing interest expense, other interest expense and interest income. Pitney Bowes Inc. Revenue and EBIT Business Segments December 31, 2012 (Unaudited) (Dollars in thousands) Twelve Months Ended December 31, % 2012 2011 Change Revenue North America Mailing $ 1,818,952 $ 1,961,198 (7 %) International Mailing 675,637 707,416 (4 %) Small & Medium Business Solutions 2,494,589 2,668,614 (7 %) Production Mail 512,109 544,483 (6 %) Software 393,380 407,402 (3 %) Management Services 920,959 948,891 (3 %) Mail Services 445,092 411,634 8 % Marketing Services 137,886 141,572 (3 %) Enterprise Business Solutions 2,409,426 2,453,982 (2 %) Total Revenue $ 4,904,015 $ 5,122,596 (4 %) EBIT (1) North America Mailing $ 688,665 $ 727,999 (5 %) International Mailing 78,979 98,601 (20 %) Small & Medium Business Solutions 767,644 826,600 (7 %) Production Mail 25,644 32,562 (21 %) Software 37,958 38,182 (1 %) Management Services 55,198 76,321 (28 %) Mail Services 101,005 103,026 (2 %) Marketing Services 28,061 26,184 7 % Enterprise Business Solutions 247,866 276,275 (10 %) Total EBIT $ 1,015,510 $ 1,102,875 (8 %) Unallocated amounts: Interest, net (188,386 ) (197,266 ) Corporate and other expenses (199,394 ) (198,020 ) Restructuring and asset impairments (23,117 ) (136,548 ) Goodwill impairment - (84,500 ) Income from continuing operations $ 604,613 $ 486,541 before income taxes Earnings before interest and taxes (EBIT) excludes general corporate (1) expenses, restructuring charges and asset impairments and goodwill impairment. (2) Interest, net includes financing interest expense, other interest expense and interest income. Pitney Bowes Inc. Reconciliation of Reported Consolidated Results to Adjusted Results (Unaudited) (Dollars in thousands, except per share data) Three Months Ended December Twelve Months Ended December 31, 31, 2012 2011 2012 2011 GAAP income from continuing operations after income taxes, as $ 98,950 $ 50,575 $ 435,932 $ 400,556 reported Restructuring charges and 15,096 62,571 15,407 97,660 asset impairments Goodwill - 82,890 - 82,890 impairment Sale of leveraged - - (12,886 ) (26,689 ) lease assets Tax - 579 - 3,539 adjustments Income from continuing operations after income taxes, as $ 114,046 $ 196,615 $ 438,453 $ 557,956 adjusted GAAP diluted earnings per share from continuing operations, as $ 0.49 $ 0.25 $ 2.16 $ 1.98 reported Restructuring charges and 0.07 0.31 0.08 0.48 asset impairments Goodwill - 0.41 - 0.41 impairment Sale of leveraged - - (0.06 ) (0.13 ) lease Tax - 0.00 - 0.02 adjustments Diluted earnings per share from continuing operations, as $ 0.56 $ 0.98 $ 2.18 $ 2.75 adjusted GAAP net cash provided by operating activities, as reported $ 255,560 $ 198,531 $ 660,188 $ 948,987 Capital (48,770 ) (32,951 ) (176,586 ) (155,980 ) expenditures Restructuring 13,972 28,623 74,718 107,002 payments Pension - - 95,000 123,000 contribution Tax payments on sale of 14,879 - 114,128 - leveraged lease assets Reserve account 17,009 49,882 1,636 35,354 deposits Free cash flow, as $ 252,650 $ 244,085 $ 769,084 $ 1,058,363 adjusted NOTE: The sum of the earnings per share amounts may not equal the totals above due to rounding. The above table includes an adjustment to GAAP net cash provided by operating activities due to a reclassification between net cash provided by operating activities and net cash used in investing activities. As a result, GAAP net cash provided by operating activities increased by $28.8 million for the year ended December 31, 2011, and decreased by $35.0 million for the nine months ended September 30, 2012. Pitney Bowes Inc. Reconciliation of Reported Consolidated Results to Adjusted Results (Unaudited) (Dollars in thousands, except per share data) Three Months Ended December Twelve Months Ended December 31, 31, 2012 2011 2012 2011 GAAP income from continuing operations after income taxes, as $ 98,950 $ 50,575 $ 435,932 $ 400,556 reported Restructuring charges and 15,096 62,571 15,407 97,660 asset impairments Goodwill - 82,890 - 82,890 impairment Sale of leveraged lease - - (12,886 ) (26,689 ) assets Tax adjustments - 579 - 3,539 Income from continuing operations after income taxes, as 114,046 196,615 438,453 557,956 adjusted Provision for income taxes, 51,418 (9,623 ) 174,718 138,539 as adjusted Preferred stock dividends of subsidiaries attributable to noncontrolling 4,594 4,594 18,376 18,375 interests Income from continuing 170,058 191,586 631,547 714,870 operations, as adjusted Interest 45,533 49,047 188,386 197,266 expense, net Adjusted EBIT 215,591 240,633 819,933 912,136 Depreciation and 64,049 67,141 255,556 272,142 amortization Adjusted EBITDA $ 279,640 $ 307,774 $ 1,075,489 $ 1,184,278 Contact: Pitney Bowes Inc. Editorial – Sheryl Y. Battles VP, Corp. Communications 203-351-6808 or Financial – Charles F. McBride VP, Investor Relations 203-351-6349 Website – www.pitneybowes.com
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Pitney Bowes Announces Fourth Quarter and Annual Results for 2012
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