Pitney Bowes Announces Second Quarter 2020 Financial Results

Note: Consolidated statements of income; revenue, EBIT and EBITDA by business segment; and reconciliations of GAAP to non-GAAP measures for the three months and six months ended June 30, 2020 and 2019, and consolidated balance sheets at June 30, 2020 and December 31, 2019 are attached.

 

Pitney Bowes Inc.                
Consolidated Statements of Income (Loss)                
(Unaudited; in thousands, except per share amounts)                
                   
      Three months ended June 30,   Six months ended June 30,
     

 

2020

 

 

 

2019

 

 

 

2020

 

 

 

2019

 

Revenue:                
  Business services  

 $

                                 528,990

 

 

 $

                                 417,963

 

 

 $

                                 973,369

 

 

 $

                                 824,508

 

  Support services  

 

                                    113,786

 

 

 

                                    127,705

 

 

 

                                    235,801

 

 

 

                                    256,304

 

  Financing  

 

                                      85,462

 

 

 

                                      92,419

 

 

 

                                    174,540

 

 

 

                                    189,462

 

  Equipment sales  

 

                                      57,837

 

 

 

                                      85,551

 

 

 

                                    134,110

 

 

 

                                    175,338

 

  Supplies  

 

                                      32,773

 

 

 

                                      46,490

 

 

 

                                      78,482

 

 

 

                                      97,443

 

  Rentals  

 

                                      18,644

 

 

 

                                      18,445

 

 

 

                                      37,458

 

 

 

                                      40,602

 

        Total revenue  

 

                                    837,492

 

 

 

                                    788,573

 

 

 

                                 1,633,760

 

 

 

                                 1,583,657

 

                   
Costs and expenses:                
  Cost of business services  

 

                                    454,311

 

 

 

                                    337,918

 

 

 

                                    828,976

 

 

 

                                    664,964

 

  Cost of support services  

 

                                      36,725

 

 

 

                                      40,520

 

 

 

                                      76,485

 

 

 

                                      82,367

 

  Financing interest expense  

 

                                      11,939

 

 

 

                                      11,043

 

 

 

                                      24,428

 

 

 

                                      22,407

 

  Cost of equipment sales  

 

                                      47,920

 

 

 

                                      58,570

 

 

 

                                    105,279

 

 

 

                                    122,235

 

  Cost of supplies  

 

                                        8,379

 

 

 

                                      11,758

 

 

 

                                      20,619

 

 

 

                                      25,308

 

  Cost of rentals  

 

                                        6,022

 

 

 

                                        8,418

 

 

 

                                      12,400

 

 

 

                                      18,133

 

  Selling, general and administrative  

 

                                    233,631

 

 

 

                                    241,467

 

 

 

                                    482,264

 

 

 

                                    503,136

 

  Research and development  

 

                                        7,467

 

 

 

                                      13,572

 

 

 

                                      19,583

 

 

 

                                      26,149

 

  Goodwill impairment  

 

                                              -

 

 

 

                                              -

 

 

 

                                    198,169

 

 

 

                                              -

 

  Restructuring charges and asset impairments  

 

                                        4,922

 

 

 

                                        5,899

 

 

 

                                        8,739

 

 

 

                                        9,599

 

  Interest expense, net  

 

                                      26,446

 

 

 

                                      28,019

 

 

 

                                      52,329

 

 

 

                                      55,621

 

  Other components of net pension and postretirement income  

 

                                           386

 

 

 

                                      (1,618

)

 

 

                                           235

 

 

 

                                      (2,256

)

  Other (income) expense  

 

                                    (17,375

)

 

 

                                           (27

)

 

 

                                      16,112

 

 

 

                                      17,683

 

       Total costs and expenses  

 

                                    820,773

 

 

 

                                    755,539

 

 

 

                                 1,845,618

 

 

 

                                 1,545,346

 

                   
Income (loss) from continuing operations before taxes  

 

                                      16,719

 

 

 

                                      33,034

 

 

 

                                  (211,858

)

 

 

                                      38,311

 

Provision for income taxes  

 

                                      17,016

 

 

 

                                        3,724

 

 

 

                                        6,986

 

 

 

                                      11,544

 

(Loss) income from continuing operations   

 

                                         (297

)

 

 

                                      29,310

 

 

 

                                  (218,844

)

 

 

                                      26,767

 

(Loss) income from discontinued operations, net of tax  

 

                                      (3,032

)

 

 

                                      (5,613

)

 

 

                                        7,032

 

 

 

                                      (5,729

)

Net (loss) income  

 $

                                   (3,329

)

 

 $

                                   23,697

 

 

 $

                               (211,812

)

 

 $

                                   21,038

 

                   
Basic (loss) earnings per share (1):                
  Continuing operations  

 $

                                           -

 

 

 $

                                       0.17

 

 

 $

                                     (1.28

)

 

 $

                                       0.15

 

  Discontinued operations  

 

                                        (0.02

)

 

 

                                        (0.03

)

 

 

                                          0.04

 

 

 

                                        (0.03

)

  Net (loss) income  

 $

                                     (0.02

)

 

 $

                                       0.13

 

 

 $

                                     (1.24

)

 

 $

                                       0.12

 

                   
Diluted (loss) earnings per share (1):                
  Continuing operations  

 $

                                           -

 

 

 $

                                       0.16

 

 

 $

                                     (1.28

)

 

 $

                                       0.15

 

  Discontinued operations  

 

                                        (0.02

)

 

 

                                        (0.03

)

 

 

                                          0.04

 

 

 

                                        (0.03

)

  Net (loss) income  

 $

                                     (0.02

)

 

 $

                                       0.13

 

 

 $

                                     (1.24

)

 

 $

                                       0.12

 

                   
Weighted-average shares used in diluted earnings per share  

 

                                    171,478

 

 

 

                                    178,281

 

 

 

                                    171,167

 

 

 

                                    182,638

(1)   The sum of the earnings per share amounts may not equal the totals due to rounding.
Pitney Bowes Inc.      
Consolidated Balance Sheets      
(Unaudited; in thousands)      
         
Assets June 30,
 2020
  December 31,
 2019
Current assets:      
  Cash and cash equivalents

 $

                                    862,897

 

 

 $

                                    924,442

 

  Short-term investments

 

                                        153,221

 

 

 

                                        115,879

 

  Accounts and other receivables, net

 

                                        391,748

 

 

 

                                        373,471

 

  Short-term finance receivables, net

 

                                        555,196

 

 

 

                                        629,643

 

  Inventories

 

                                          73,653

 

 

 

                                          68,251

 

  Current income taxes

 

                                            1,893

 

 

 

                                            5,565

 

  Other current assets and prepayments

 

                                        121,924

 

 

 

                                        101,601

 

  Assets of discontinued operations

 

                                                   -

 

 

 

                                          17,229

 

Total current assets

 

                                    2,160,532

 

 

 

                                    2,236,081

 

         
Property, plant and equipment, net

 

                                        375,465

 

 

 

                                        376,177

 

Rental property and equipment, net

 

                                          40,875

 

 

 

                                          41,225

 

Long-term finance receivables, net

 

                                        583,839

 

 

 

                                        625,487

 

Goodwill

 

                                    1,132,785

 

 

 

                                    1,324,179

 

Intangible assets, net

 

                                        175,460

 

 

 

                                        190,640

 

Operating lease assets

 

                                        199,162

 

 

 

                                        200,752

 

Noncurrent income taxes

 

                                          68,449

 

 

 

                                          71,903

 

Other assets

 

                                        379,611

 

 

 

                                        400,456

 

Total assets

 $

                                 5,116,178

 

 

 $

                                 5,466,900

 

         
Liabilities and stockholders' equity       
Current liabilities:      
  Accounts payable and accrued liabilities

 $

                                    732,048

 

 

 $

                                    793,690

 

  Customer deposits at Pitney Bowes Bank

 

                                        613,449

 

 

 

                                        591,118

 

  Current operating lease liabilities

 

                                          35,432

 

 

 

                                          36,060

 

  Current portion of long-term debt 

 

                                        163,257

 

 

 

                                          20,108

 

  Advance billings

 

                                        122,606

 

 

 

                                        101,920

 

  Current income taxes

 

                                          11,723

 

 

 

                                          17,083

 

  Liabilities of discontinued operations

 

                                                   -

 

 

 

                                            9,713

 

Total current liabilities

 

                                    1,678,515

 

 

 

                                    1,569,692

 

         
Long-term debt

 

                                    2,553,490

 

 

 

                                    2,719,614

 

Deferred taxes on income

 

                                        270,376

 

 

 

                                        274,435

 

Tax uncertainties and other income tax liabilities

 

                                          35,928

 

 

 

                                          38,834

 

Noncurrent operating lease liabilities

 

                                        177,901

 

 

 

                                        177,711

 

Other noncurrent liabilities

 

                                        355,388

 

 

 

                                        400,518

 

Total liabilities

 

                                    5,071,598

 

 

 

                                    5,180,804

 

         
Stockholders' equity:      
  Common stock

 

                                        323,338

 

 

 

                                        323,338

 

  Additional paid-in-capital

 

                                          68,498

 

 

 

                                          98,748

 

  Retained earnings

 

                                    5,188,119

 

 

 

                                    5,438,930

 

  Accumulated other comprehensive loss

 

                                      (836,262

)

 

 

                                      (840,143

)

  Treasury stock, at cost

 

                                   (4,699,113

)

 

 

                                   (4,734,777

)

Total stockholders' equity 

 

                                          44,580

 

 

 

                                        286,096

 

Total liabilities and stockholders' equity

 $

                                 5,116,178

 

 

 $

                                 5,466,900

 

Pitney Bowes Inc.                      
Business Segment Revenue                      
(Unaudited; in thousands)                      
                         
     Three months ended June 30,     Six months ended June 30, 
   

 

2020

 

 

2019

 

 % Change 

 

 

2020

 

 

2019

 

 % Change

REVENUE                      
  Global Ecommerce

 $

                      398,453

 

 $

                      282,319

 

41

%

 

 $

                      690,776

 

 $

                      548,573

 

26

%

  Presort Services

 

                         118,127

 

 

                         128,138

 

(8

%)

 

 

                         258,847

 

 

                         262,985

 

(2

%)

  Commerce Services

 

                         516,580

 

 

                         410,457

 

26

%

 

 

                         949,623

 

 

                         811,558

 

17

%

                         
  Sending Technology Solutions

 

                         320,912

 

 

                         378,116

 

(15

%)

 

 

                         684,137

 

 

                         772,099

 

(11

%)

  Total revenue - GAAP

 

                         837,492

 

 

                         788,573

 

6

%

 

 

                      1,633,760

 

 

                      1,583,657

 

3

%

                         
  Currency impact on revenue

 

                             2,627

 

 

                                   -  

     

 

                             4,967

 

 

                                   -  

   
  Revenue, at constant currency

 $

                      840,119

 

 $

                      788,573

 

7

%

 

 $

                   1,638,727

 

 $

                   1,583,657

 

3

%


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