Pitney Bowes Announces 8% Increase for 4Q
Friday, February 08, 2008
Press release from the issuing company
STAMFORD, Conn., February 07, 2008 - Pitney Bowes Inc. today reported 2007 fourth quarter and annual financial results.
Revenue increased 8 percent for the quarter to $1.7 billion and 7 percent for the year to $6.1 billion. This compares with the company’s guidance range of 6 to 9 percent growth for the quarter and 6 to 8 percent growth for the year.
The company’s adjusted income from continuing operations was $157 million for the quarter and $601 million for the year. Adjusted income for the quarter and the year excludes charges related to the initiatives the company announced on November 15, 2007 to reduce costs, accelerate improvements in operational efficiency and transition its product line; an impairment of certain intangible assets; tax adjustments; and the alignment of MapInfo’s accounting treatment for software revenue recognition with the company’s policies. Adjusted income also excludes $10 million of income from discontinued operations for the quarter and $6 million of income for the year. On a Generally Accepted Accounting Principles (GAAP) basis, the company reported a net loss for the quarter of $58 million and net income of $367 million for the year.
Adjusted earnings per diluted share for the fourth quarter was $.72, which compares with the company’s guidance of $.67 to $.71 and $.77 for the prior year. Adjusted earnings per diluted share for the year was $2.72, which compares with the company’s guidance of $2.67 to $2.71 and $2.69 for the prior year. On a GAAP basis, the company reported a net loss per diluted share of $.27 for the fourth quarter, compared with earnings of $.71 per diluted share for the prior year. Earnings per diluted share for the year on a GAAP basis was $1.66, compared with $.47 for the prior year.
The company’s results for the quarter and the year are further summarized in the table below:
Free cash flow for the quarter was $374 million. Free cash flow for the year was $924 million, which compares with the company’s guidance of $625 million to $675 million. Free cash flow for the quarter and the year reflects lower utilization of cash for capital expenditures and working capital; lower tax payments; lower finance receivables; an increase in customer deposits for postage; and proceeds from the sale of one of the company’s facilities.
The company generated $364 million in cash from operations for the quarter and $1.1 billion for the year.
During the quarter, the company used $72 million of cash for dividends and $120 million to repurchase 3.1 million of its shares. The remaining authorization for future share repurchases is $407 million. For the year, the company returned $289 million to shareholders through dividends and repurchased $400 million of its shares.
Commenting on the quarter and the year, President and CEO Murray D. Martin noted, “We anticipated the factors that affected our results for the quarter, and are pleased with the positive impact of the actions we have taken in response to current conditions. During the quarter, we also benefited from the ongoing demand by large enterprise customers for our expanded software solutions and the continued success of our mail services business. As a result, we exceeded our revised earnings expectations. We also achieved exceptionally strong levels of free cash flow, which gives us the financial flexibility to invest in the future and return cash to our shareholders.
While we faced several challenges in 2007, we believe the actions we took in the fourth quarter, and that we will continue to take in 2008, will position the company for sustained, long-term improvement in earnings and increased shareholder value. We have the world’s most advanced mailing systems that are networkable and capable of accommodating a wide variety of postal rates and facilitating services that posts worldwide currently offer and will offer mailers in the future. We recognize the challenges ahead of us and have taken decisive actions to improve customer service, streamline our processes, and reduce our cost structure.”
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