Pitney Bowes Inc.
) reported fourth-quarter 2012 earnings per share from continuing
operations of 56 cents, above the Zacks Consensus Estimate of 51
cents but below the prior-year earnings of 98 cents. The earnings
for the quarter include net tax benefit of 37 cents as a result
of an agreement between the company and the IRS on the tax
treatment of a number of issues, as well as revised tax
For 2012, the company's earnings per share from continuing
operations were $2.18 compared with $2.75 in 2011. The Zacks
Consensus Estimate for the year was $2.00.
Total revenue was $1.3 billion; down 1% y/y. Foreign currency
effect was neutral to total revenue. Revenue in the quarter was
aided by improvement in revenue trend in four of its business
For 2012, total revenue was $4.9 billion, down 4% year over
Small and Medium Business (SMB) Solutions
segment sales declined 6% year over year on a constant currency
basis to $644 million, as a result of a fall in North America
Mailing revenue by 6%, partially offset by a 4% increase in
International Mailing revenue.
Enterprise Business Solutions
segment sales increased by 1% year over year to $643 million, led
by a 2% increase in revenue from Software, 5% in Management
Services and 2% in Mail Services. The positive effect was
partially offset by a 5% decrease in Marketing Services revenue
and 6% in Worldwide Production Mail revenue.
The company incurred total SG&A expense of approximately
$410.3 million in the quarter versus approximately $425.5 million
in the fourth quarter of 2011. R&D expense was $32.4 million
versus $40.9 million. Income from continuing operations of the
company was $147.8 million compared with $23 million in the
Cash and cash equivalents were $913.3 million with long-term
debt of $3.6 billion and shareholder's deficit of $110.6 million
compared to prior year figures of $856.3 million, $3.7 billion
and shareholders' deficit of $39 million, respectively.
Free cash flow in the quarter was $215.3 million versus $289.5
million in fourth quarter of 2010.
The company expects its revenue growth trend to improve in
2013 with a number of initiatives designed to drive new growth
opportunities. In 2013, the Company expects revenue growth in its
Enterprise Solutions Group and an improvement in revenue in its
SMB Solutions Group though the segment is expected to still
witness a negative growth.
For 2013, revenue growth, excluding the impact of currency, is
expected to be in the range of flat to a 3% increase. The company
expects earnings per share from continuing operations to be in
the range of $1.85 to $2.00. Free cash flow for 2013 is expected
to be in the range of $600 million to $700 million.
Pitney Bowes currently has a Zacks Rank #4 (Sell) which might
not be a good stock to consider at the moment. However, some
other companies that can be considered at the moment are
) which has a Zacks Rank #1 and
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