Pitney Bowes Announces Third Quarter 2017 Financial Results

North America Mailing

The Company successfully launched the new SendPro C-Series product line in early September, and as such recognized less than a month of equipment sales from this new product during the quarter. Equipment sales declined largely due to lower sales in the top of the line products, where prior year included a large deal, and this year, a few deals did not close in the quarter. In addition, North America Mailing realized a lower level of client lease extensions, which impacted equipment sales. Recurring revenue streams declined, largely around lower rentals and financing revenue. EBIT margin was lower than prior year largely due to the decline and mix of equipment sales along with the decline in recurring streams.

International Mailing

Revenue declined largely due to lower recurring revenue streams. Equipment sales were relatively flat driven by growth in France and the UK, and offset primarily by weakness in Italy and Japan. EBIT margin decreased slightly from prior year.

 

Enterprise Business Solutions Group

      ($ millions)     Third Quarter
      Revenue    

   2017   

 

   2016   

 

Y/Y
Reported

 

Y/Y
Ex Currency

      Production Mail     $104   $106   (2 %)   (3 %)
      Presort Services     119   114   4 %   4 %
      Enterprise Business     $223   $220   1 %   1 %
                         
      EBIT                  
      Production Mail     $15   $16   (5 %)    
      Presort Services     19   19   2 %    
      Enterprise Business     $34   $35   (1 %)    
                           

 

Production Mail

Equipment sales declined versus prior year largely due to lower inserter equipment placements, which were partially offset by higher print equipment sales. Support services revenue was slightly favorable, but offset by a decline in Supplies revenue. EBIT margin declined from prior year primarily as a result of the decline in revenue and the mix of equipment sales.

Presort Services

Revenue growth was driven by improved revenue per piece along with higher Standard Class mail and Parcel volumes processed, but partly offset by lower First Class mail volumes. EBIT margin declined slightly from prior year driven by increased mail processing costs and investments in the Company’s new parcel sortation capabilities.

 

Digital Commerce Solutions Group

      ($ millions)     Third Quarter
      Revenue    

   2017   

 

   2016   

 

Y/Y
Reported

 

Y/Y
Ex Currency

      Software Solutions     $99     $89   12 %   11 %
      Global Ecommerce     106     83   28 %   28 %
      Digital Commerce     $206     $172   19 %   19 %
                         
      EBIT                  
      Software Solutions     $21     $10  

> 100

%

   
      Global Ecommerce     (10 )   2  

> (100

%)

   
      Digital Commerce     $11     $12   (5 %)    
                             

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