STAMFORD, Conn.--(BUSINESS WIRE)--Oct. 29, 2015-- Pitney Bowes Inc. (NYSE:PBI), a global technology company that provides products and solutions that power commerce, today reported financial results for the third quarter 2015.

Quarterly Financial Results:

• Revenue of $870 million, a decline of 4 percent on a constant currency basis and 8 percent as reported.
• Adjusted EPS of $0.43; GAAP EPS of $0.44. EPS includes a $0.02 per share negative impact of foreign exchange during the quarter.
• SG&A of $309 million, a decline of $33 million versus prior year.
• Gross Margin of 58.8 percent, improvement of 150 basis points versus prior year.
• Free cash flow of $131 million; GAAP cash from operations of $150 million.
• Repurchased $100 million of stock or 4.9 million shares.
• Company reaffirms adjusted EPS, GAAP EPS and free cash flow guidance; updates revenue guidance.

Strategic Updates:

• As announced in September, the Board of Directors authorized an incremental $100 million share repurchase.
• The Company launched its initial implementation of the new ERP platform in Canada in early October and remains on schedule to achieve the targeted savings and efficiencies associated with this program.
• The Company introduced several new products and solutions, including:
  • SMB group launched the Relay™ Multi-Channel Communications Suite globally;
  • Production Mail expanded its offerings in print, insertion and sortation equipment through its new AcceleJet™, Epic™ and TrueSort™ products;
  • Software expanded its offerings with the EngageOne^® Video solution, which helps enterprises up-sell and cross-sell through personalized videos.
• The Company made significant progress integrating its Borderfree acquisition while also achieving initial cost synergies.

"We made solid progress on our strategic plan in the third quarter," said Marc B. Lautenbach, President and CEO, Pitney Bowes. “Our North America SMB business continued to stabilize with equipment sales growing for the quarter. We improved our operational excellence with increased margins and very solid cash flow performance in the quarter. Our ERP project, which promises to unlock substantial value in our Company, got off to a very good start in early October with a successful launch in Canada. Finally, although our Ecommerce business continued to face currency headwinds, the integration of Borderfree remains on track. Overall, Digital Commerce grew 10 percent on a constant currency basis and I remain very optimistic about the long-term prospects of this business."

THIRD QUARTER 2015 - FINANCIAL RESULTS

Revenue was $870 million, a decline of 4 percent on a constant currency basis and 8 percent on a reported basis when compared to prior year.

Digital Commerce Solutions revenue grew 10 percent on a constant currency basis and 6 percent on a reported basis. Enterprise Business Solutions revenue declined 1 percent on a constant currency basis and 3 percent on a reported basis. SMB Solutions revenue declined 3 percent on a constant currency basis and 8 percent on a reported basis.

Adjusted earnings per diluted share were $0.43. Prior year adjusted earnings per diluted share were $0.51 and included $0.08 per share of tax benefits. Excluding the tax benefits in the prior year, adjusted earnings per diluted share this quarter would have been flat to the prior year.

Generally Accepted Accounting Principles (GAAP) earnings per diluted share were $0.44 and included a $0.01 per share net tax benefit related to the Company’s previous divestiture of an investment and other acquisition and disposition related transactions.

Earnings per share this quarter were reduced by $0.02 per share due to the impacts of foreign exchange. As expected, earnings per share this quarter were also impacted by the loss of three months of Imagitas earnings, which were estimated to be approximately $0.03 per share, and $0.01 per share of expense for three months of amortization of intangibles related to Borderfree.

The Company’s earnings per share results for the quarter are summarized in the table below:

			Third Quarter *
			2015				2014
Adjusted EPS from continuing operations			$	0.43			$	0.51
Net tax benefit from transactions			$	0.01				-
Investment divestiture				-			$	0.05
Restructuring charges				-				($0.01	)
GAAP EPS from continuing operations			$	0.44			$	0.55
Discontinued operations - income				-			$	0.10
GAAP EPS			$	0.44			$	0.65
* The sum of the earnings per share may not equal the totals above due to rounding

Free cash flow during the quarter was $131 million and cash provided by operating activities was $150 million on a GAAP basis. In comparison to the prior year, third quarter free cash flow was higher primarily due to lower working capital requirements and lower capital expenditures due to less of an investment in the Company’s new ERP platform. During the quarter, the Company used cash to pay $38 million in dividends to its common shareholders, repurchase $100 million worth of its shares and make $15 million in restructuring payments.

BUSINESS SEGMENT REPORTING

The Company revised its business segment reporting in the second quarter 2015 for its Digital Commerce Solutions segment. The Company’s business segment reporting reflects the clients served in each market and the way it manages these segments for growth and profitability. The primary reporting segment groups are the SMB Solutions group; the Enterprise Business Solutions group; and the Digital Commerce Solutions group.

The SMB Solutions group offers mailing equipment, financing, services and supplies for small and medium businesses to efficiently create mail and evidence postage. This group includes the North America Mailing and International Mailing segments. North America Mailing includes the operations of U.S. and Canada Mailing. International Mailing includes all other SMB operations around the world.

The Enterprise Business Solutions group provides mailing and printing equipment and services for large enterprise clients to process mail, including sortation services to qualify large mail volumes for postal worksharing discounts. This group includes the global Production Mail and Presort Services segments.

The Digital Commerce Solutions group provides customer engagement, customer information and location intelligence software; and solutions that facilitate global cross-border ecommerce transactions and shipping solutions for businesses of all sizes. This group includes the Software Solutions and Global Ecommerce segments.

The Other segment is comprised of the Imagitas marketing services business, which was sold on May 29, 2015.

SMB Solutions Group
					($ millions)				Third Quarter
					Revenue				2015		2014		Y/Y Reported		Y/Y Ex Currency		Y/Y Ex Currency and Divested Revenues*
					North America Mailing				$353		$363		(3%)		(2%)		(2%)
					International Mailing				105		132		(21%)		(9%)		(7%)
					SMB Solutions Total				$458		$496		(8%)		(3%)		(3%)
					EBIT
					North America Mailing				$159		$160		0%
					International Mailing				11		16		(33%)
					SMB Solutions Total				$170		$176		(3%)

* Excludes the impacts of currency and the divested revenues in Europe related to the transition to a dealer sales network in six smaller European markets completed in the third quarter of 2014.

North America Mailing

North America Mailing revenue experienced the lowest rate of decline in 6 quarters, benefiting from 2 percent growth in equipment sales as productivity continues to improve. Recurring revenue stream trends also continued to be in-line with prior quarters. EBIT margin continued to improve versus the prior year due to the mix of business, organizational streamlining and on-going cost reduction initiatives.

International Mailing

During the quarter, currency adversely affected revenue comparisons by 12 percentage points. For comparative purposes, revenue declined 7 percent when adjusted for the impacts of both currency and the reduction in revenue resulting from the exit of direct operations in some European countries completed in the third quarter of 2014.

The rate of decline in revenue is stabilizing in most of the major markets where the go-to-market resource shift has been completed. The Company has been focused on the transition and training of the new sales organization in France, which is expected to result in improved productivity. EBIT margin declined versus the prior year due to lower mail finishing equipment sales, the impact of currency on costs and the temporary incremental costs related to the transition of the sales organization in France.

Enterprise Business Solutions Group
					($ millions)			Third Quarter
					Revenue			2015		2014		Y/Y Reported		Y/Y Ex Currency		Y/Y Ex Currency and Divested Revenues*
					Production Mail			$102		$113		(10%)		(5%)		(4%)
					Presort Services			116		111		4%		4%		4%
					Enterprise Business Total			$218		$225		(3%)		(1%)		0%
					EBIT
					Production Mail			$12		$10		30%
					Presort Services			26		22		18%
					Enterprise Business Total			$38		$31		22%

* Excluding the impacts of currency and the divested revenues in Europe related to the transition to a dealer sales network in six smaller European markets completed in the third quarter of 2014.

Production Mail

While inserting equipment sales grew versus prior year, there were no production print installations during the quarter, which adversely impacted revenue. Revenue also declined partially due to lower support services. EBIT margin improved versus the prior year due to the mix of higher-margin inserting equipment sales as well as on-going cost reduction initiatives.

Presort Services

Revenue benefited from higher volumes of First Class and Standard mail processed versus the prior year. EBIT margin improved versus the prior year due to the revenue growth and on-going operational productivity.

Digital Commerce Solutions Group
					($ millions)				Third Quarter
					Revenue				2015		2014		Y/Y Reported		Y/Y Ex Currency
					Software Solutions				$98		$112		(13%)		(7%)
					Global Ecommerce				97		72		34%		36%
					Digital Commerce Total				$194		$184		6%		10%
					EBIT
					Software Solutions				$15		$19		(23%)
					Global Ecommerce				(1)		(1)		(83%)
					Digital Commerce Total				$13		$18		(27%)

Software Solutions

Revenue comparisons were adversely impacted by lower licensing revenue in the Americas when compared to the prior year, which included a large licensing deal. Excluding the impact of that deal, Software’s results were in-line with expectations as the business continues to acquire new enterprise clients through targeted industry and application-specific solutions. EBIT margin declined as a result of a lower amount of licensing revenue, which has a higher-margin.

Global Ecommerce

Results included a full quarter of revenue from Borderfree and the continued expansion of the eBay UK outbound cross-border service. Outbound package shipments from the U.S. continued to be pressured by the strong U.S. dollar. EBIT margin was impacted primarily by amortization of intangibles and investments related to the Borderfree acquisition, offsetting benefits from initial integration synergies.

Other

($ millions)

Third Quarter

2015

2014

Y/Y Reported

Y/Y Ex Currency

Revenue

$0

$37

NM

NM

EBIT

$0

$8

NM

The Other segment is comprised of the Imagitas marketing services business, which was sold in May 2015.

2015 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 2014 Form 10-K Annual Report and other reports filed with the Securities and Exchange Commission.

The Company expects improving trends in the business to continue into the fourth quarter as a result of actions taken to achieve its long-term strategic initiatives. The Company is reaffirming its annual adjusted EPS, GAAP EPS and free cash flow guidance. The Company is updating its annual revenue guidance based on year-to-date results and the outlook for the remainder of the year.

The Company now expects:

• Annual revenue to be in the range of flat to a decline of 2 percent when compared to 2014 on a constant currency basis.

The Company still expects:

• Adjusted EPS to be in the range of $1.75 to $1.90;
• GAAP EPS to be in the range of $2.06 to $2.21;
• Free cash flow to be in the range of $450 million to $525 million.

As a reminder, GAAP EPS guidance for the year includes the following:

• $0.44 per share of Other income related to the net gain from the sale of Imagitas;
• $0.05 per share of Other expense for the resolution of an outstanding legal matter and transaction costs and fees related to the Borderfree and Imagitas transactions;
• $0.04 per share of Restructuring and asset impairment charges;
• $0.04 per share of compensation expense related to the vesting of options associated with the Borderfree acquisition.

This guidance excludes any unusual items that may occur or additional portfolio or restructuring actions, not specifically identified, as the Company implements plans to further streamline its operations and reduce costs.

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. ET. 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

Pitney Bowes (NYSE:PBI) is a global technology company offering innovative products and solutions that enable commerce in the areas of customer information management, location intelligence, customer engagement, shipping and mailing, and global ecommerce. More than 1.5 million clients in approximately 100 countries around the world rely on products, solutions and services from Pitney Bowes. For additional information, visit Pitney Bowes at www.pitneybowes.com.

The Company's financial results are reported in accordance with generally accepted accounting principles (GAAP). The Company uses measures such as adjusted earnings before interest and taxes (EBIT), 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 goodwill and asset write-downs, because, while these are actual Company expenses, they can mask underlying trends associated with its 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 settlements or payments and contributions to its pension funds. Management uses segment EBIT to measure profitability and performance at the segment level. Segment EBIT is determined by deducting from revenue 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 and goodwill and asset impairments, which are recognized on a consolidated basis. In addition, revenue growth is 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 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 the Company’s expected or potential future business and financial performance. Forward-looking statements include, but are not limited to, statements about its 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; the implementation of a new enterprise resource planning system; changes in business portfolio; the success of our investment in rebranding the Company; the risk of customer concentration in our Digital Commerce Solutions group; integrating newly acquired businesses, including operations and product and service offerings; 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 its control as more fully outlined in the Company's 2014 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 and nine months ended September 30, 2015 and 2014, and consolidated balance sheets at September 30, 2015 and December 31, 2014 are attached.

Pitney Bowes Inc.
Consolidated Statements of Income
(Unaudited; in thousands, except per share data)
			Three months ended September 30,								Nine months ended September 30,
			2015				2014				2015				2014
Revenue:
	Equipment sales		$	163,857			$	177,458			$	495,328			$	558,032
	Supplies			71,174				72,548				215,178				228,349
	Software			97,700				112,271				283,241				312,891
	Rentals			108,420				119,047				333,729				365,069
	Financing			99,925				107,835				306,992				325,529
	Support services			136,820				154,321				415,615				470,763
	Business services			191,645				198,164				591,030				576,958
	Total revenue			869,541				941,644				2,641,113				2,837,591
Costs and expenses:
	Cost of equipment sales			78,650				90,984				232,706				262,336
	Cost of supplies			21,629				22,470				65,912				70,129
	Cost of software			27,219				29,775				85,584				93,423
	Cost of rentals			21,423				23,636				63,127				74,273
	Financing interest expense			17,533				19,667				54,171				59,733
	Cost of support services			79,747				92,500				244,853				288,203
	Cost of business services			130,004				142,512				405,559				406,472
	Selling, general and administrative			309,211				341,738				939,318				1,031,497
	Research and development			29,153				26,060				83,693				80,901
	Restructuring charges and asset impairments, net			36				4,526				14,305				22,666
	Interest expense, net			20,165				22,158				65,200				67,704
	Other (income) expense, net			(1,781	)			(15,919	)			(94,916	)			45,738
	Total costs and expenses			732,989				800,107				2,159,512				2,503,075
Income from continuing operations before income taxes				136,552				141,537				481,601				334,516
Provision for income taxes				42,676				25,310				145,574				79,681
Income from continuing operations				93,876				116,227				336,027				254,835
Income (loss) from discontinued operations, net of tax				-				20,655				(582	)			30,173
Net income before attribution of noncontrolling interests				93,876				136,882				335,445				285,008
Less: Preferred stock dividends of subsidiaries attributable to noncontrolling interests				4,594				4,593				13,781				13,781
Net income - Pitney Bowes Inc.			$	89,282			$	132,289			$	321,664			$	271,227
Amounts attributable to common stockholders:
	Income from continuing operations		$	89,282			$	111,634			$	322,246			$	241,054
	Income (loss) from discontinued operations, net of tax			-				20,655				(582	)			30,173
	Net income - Pitney Bowes Inc.		$	89,282			$	132,289			$	321,664			$	271,227
Basic earnings per share attributable to common stockholders (1):
	Continuing operations		$	0.45			$	0.55			$	1.60			$	1.19
	Discontinued operations			-				0.10				-				0.15
	Net income - Pitney Bowes Inc.		$	0.45			$	0.65			$	1.60			$	1.34
Diluted earnings per share attributable to common stockholders (1):
	Continuing operations		$	0.44			$	0.55			$	1.60			$	1.18
	Discontinued operations			-				0.10				-				0.15
	Net income - Pitney Bowes Inc.		$	0.44			$	0.65			$	1.59			$	1.33
Weighted-average shares used in diluted EPS				201,016,809				203,968,557				201,884,967				203,959,978
(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, except per share data)
Assets				September 30, 2015				December 31, 2014 (1)
Current assets:
	Cash and cash equivalents			$	715,976			$	1,079,145
	Short-term investments				34,318				32,121
	Accounts receivable, gross				411,804				448,017
	Allowance for doubtful accounts				(12,680	)			(10,742	)
	Accounts receivable, net				399,124				437,275
	Short-term finance receivables				956,767				1,019,412
	Allowance for credit losses				(16,143	)			(19,108	)
	Short-term finance receivables, net				940,624				1,000,304
	Inventories				103,195				84,827
	Current income taxes				33,057				40,542
	Other current assets and prepayments				71,454				57,173
	Assets held for sale				-				52,271
Total current assets					2,297,748				2,783,658
Property, plant and equipment, net					317,005				285,091
Rental property and equipment, net					188,485				200,380
Long-term finance receivables					774,690				828,723
Allowance for credit losses					(6,551	)			(9,002	)
Long-term finance receivables, net					768,139				819,721
Goodwill					1,753,888				1,672,721
Intangible assets, net					192,318				82,173
Non-current income taxes					70,731				96,377
Other assets					553,467				569,110
Total assets				$	6,141,781			$	6,509,231
Liabilities, noncontrolling interests and stockholders' equity
Current liabilities:
	Accounts payable and accrued liabilities			$	1,379,337			$	1,572,971
	Current income taxes				79,689				90,167
	Current portion of long-term debt and notes payable				521,091				324,879
	Advance billings				353,467				386,846
Total current liabilities					2,333,584				2,374,863
Deferred taxes on income					131,416				64,839
Tax uncertainties and other income tax liabilities					94,822				86,127
Long-term debt					2,471,055				2,927,127
Other non-current liabilities					672,507				682,646
Total liabilities					5,703,384				6,135,602
Noncontrolling interests (Preferred stockholders' equity in subsidiaries)					296,370				296,370
Stockholders' equity:
	Cumulative preferred stock, $50 par value, 4% convertible				1				1
	Cumulative preference stock, no par value, $2.12 convertible				519				548
	Common stock, $1 par value				323,338				323,338
	Additional paid-in-capital				156,195				178,852
	Retained earnings				5,106,214				4,897,708
	Accumulated other comprehensive loss				(900,852	)			(846,156	)
	Treasury stock, at cost				(4,543,388	)			(4,477,032	)
Total Pitney Bowes Inc. stockholders' equity					142,027				77,259
Total liabilities, noncontrolling interests and stockholders' equity				$	6,141,781			$	6,509,231
(1) Certain prior year amounts have been revised.

Pitney Bowes Inc.
Revenue and EBIT
Business Segments
(Unaudited; in thousands)
			Three Months Ended September 30,
											%
			2015				2014				Change
	Revenue
	North America Mailing		$	353,159			$	363,285			(3	%)
	International Mailing			104,615				132,291			(21	%)
	Small & Medium Business Solutions			457,774				495,576			(8	%)
	Production Mail			101,646				113,497			(10	%)
	Presort Services			115,912				111,434			4	%
	Enterprise Business Solutions			217,558				224,931			(3	%)
	Software Solutions			97,638				112,006			(13	%)
	Global Ecommerce			96,571				71,870			34	%
	Digital Commerce Solutions			194,209				183,876			6	%
	Other			-				37,261			(100	%)
	Total revenue		$	869,541			$	941,644			(8	%)
	EBIT (1)
	North America Mailing		$	159,319			$	159,638			(0	%)
	International Mailing			10,739				16,079			(33	%)
	Small & Medium Business Solutions			170,058				175,717			(3	%)
	Production Mail			12,401				9,570			30	%
	Presort Services			25,908				21,927			18	%
	Enterprise Business Solutions			38,309				31,497			22	%
	Software Solutions			14,613				18,921			(23	%)
	Global Ecommerce			(1,240	)			(676	)		(83	%)
	Digital Commerce Solutions			13,373				18,245			(27	%)
	Other			-				7,980			(100	%)
	Total EBIT			221,740				233,439			(5	%)
	Unallocated amounts:
	Interest, net (2)			(37,698	)			(41,825	)
	Corporate and other expenses			(49,235	)			(61,470	)
	Restructuring charges and asset impairments, net			(36	)			(4,526	)
	Other income, net			1,781				15,919
	Income from continuing operations before income taxes		$	136,552			$	141,537

(1)		Segment EBIT excludes interest, taxes, general corporate expenses, restructuring charges and other items, which are not allocated to a particular business segment.
(2)		Includes financing interest expense and interest expense, net.

Pitney Bowes Inc.
Revenue and EBIT
Business Segments
(Unaudited; in thousands)
			Nine Months Ended September 30,
											%
			2015				2014				Change
	Revenue
	North America Mailing		$	1,071,824			$	1,115,506			(4	%)
	International Mailing			331,398				438,819			(24	%)
	Small & Medium Business Solutions			1,403,222				1,554,325			(10	%)
	Production Mail			298,880				330,469			(10	%)
	Presort Services			351,365				339,206			4	%
	Enterprise Business Solutions			650,245				669,675			(3	%)
	Software Solutions			282,916				312,200			(9	%)
	Global Ecommerce			249,923				204,399			22	%
	Digital Commerce Solutions			532,839				516,599			3	%
	Other			54,807				96,992			(43	%)
	Total revenue		$	2,641,113			$	2,837,591			(7	%)
	EBIT (1)
	North America Mailing		$	482,376			$	476,757			1	%
	International Mailing			36,585				67,347			(46	%)
	Small & Medium Business Solutions			518,961				544,104			(5	%)
	Production Mail			31,461				27,865			13	%
	Presort Services			76,946				68,235			13	%
	Enterprise Business Solutions			108,407				96,100			13	%
	Software Solutions			34,904				30,620			14	%
	Global Ecommerce			9,962				9,100			9	%
	Digital Commerce Solutions			44,866				39,720			13	%
	Other			10,569				13,965			(24	%)
	Total EBIT			682,803				693,889			(2	%)
	Unallocated amounts:
	Interest, net (2)			(119,371	)			(127,437	)
	Corporate and other expenses			(151,959	)			(163,532	)
	Restructuring charges and asset impairments, net			(14,305	)			(22,666	)
	Other income (expense), net			94,916				(45,738	)
	Acquisition related compensation expense			(10,483	)			-
	Income from continuing operations before income taxes		$	481,601			$	334,516

(1)		Segment EBIT excludes interest, taxes, general corporate expenses, restructuring charges and other items, which are not allocated to a particular business segment.
(2)		Includes financing interest expense and interest expense, net.

Pitney Bowes Inc.
Reconciliation of Reported Consolidated Results to Adjusted Results
(Unaudited; in thousands, except per share data)
		Three Months Ended September 30,								Nine Months Ended September 30,
		2015				2014				2015				2014
Income from continuing operations
after income taxes, as reported:		$	89,282			$	111,634			$	322,246			$	241,054
Restructuring charges and asset impairments, net			47				2,903				8,607				15,161
Gain on sale of Imagitas			30				-				(88,399	)			-
Acquisition and disposition transaction costs			5,323				-				11,428				-
Legal settlement			(370	)			-				4,250				-
Acquisition related compensation expense			-				-				7,246				-
Investment divestiture			(7,756	)			(9,774	)			(7,756	)			(9,774	)
Extinguishment of debt			-				-				-				37,833
Income from continuing operations
after income taxes, as adjusted:		$	86,556			$	104,763			$	257,622			$	284,274
Diluted earnings per share from
continuing operations, as reported:		$	0.44			$	0.55			$	1.60			$	1.18
Restructuring charges and asset impairments, net			-				0.01				0.04				0.07
Gain on sale of Imagitas			-				-				(0.44	)			-
Acquisition and disposition transaction costs			0.03				-				0.06				-
Legal settlement			-				-				0.02				-
Acquisition related compensation expense			-				-				0.04				-
Investment divestiture			(0.04	)			(0.05	)			(0.04	)			(0.05	)
Extinguishment of debt			-				-				-				0.19
Diluted earnings per share from continuing
operations, as adjusted:		$	0.43			$	0.51			$	1.28			$	1.39
Net cash provided by operating activities,
as reported:		$	150,384			$	116,985			$	350,715			$	397,432
Capital expenditures			(40,708	)			(48,920	)			(129,643	)			(121,270	)
Restructuring payments			15,281				8,621				46,056				42,151
(Receipts) payments related to investment divestiture			(5,773	)			53,738				20,602				53,738
Reserve account deposits			(4,166	)			(12,563	)			(25,630	)			(15,919	)
Acquisition related compensation payment			-				-				10,483				-
Tax payment related to sale of Imagitas			15,918				-				15,918				-
Cash transaction fees related to acquisitions
and dispositions			-				-				11,116				-
Extinguishment of debt			-				-				-				61,657
Free cash flow, as adjusted:		$	130,936			$	117,861			$	299,617			$	417,789
Note: The sum of the earnings per share amounts may not equal the totals due to rounding.

Pitney Bowes Inc.
Reconciliation of Reported Consolidated Results to Adjusted Results
(Unaudited; in thousands)
			Three Months Ended September 30,								Nine Months Ended September 30,
			2015				2014				2015				2014
GAAP income from continuing operations
after income taxes, as reported			$	89,282			$	111,634			$	322,246			$	241,054
Restructuring charges and asset impairments, net				47				2,903				8,607				15,161
Gain on sale of Imagitas				30				-				(88,399	)			-
Acquisition and disposition transaction costs				5,323				-				11,428				-
Legal settlement				(370	)			-				4,250				-
Acquisition related compensation expense				-				-				7,246				-
Investment divestiture				(7,756	)			(9,774	)			(7,756	)			(9,774	)
Extinguishment of debt				-				-				-				37,833
Income from continuing operations
after income taxes, as adjusted				86,556				104,763				257,622				284,274
Provision for income taxes, as adjusted				43,657				20,788				140,070				104,865
Preferred stock dividends of subsidiaries
attributable to noncontrolling interests				4,594				4,593				13,781				13,781
Income from continuing operations
before income taxes, as adjusted				134,807				130,144				411,473				402,920
Interest, net				37,698				41,825				119,371				127,437
Adjusted EBIT				172,505				171,969				530,844				530,357
Depreciation and amortization				42,333				49,643				127,486				142,506
Adjusted EBITDA			$	214,838			$	221,612			$	658,330			$	672,863

View source version on businesswire.com: http://www.businesswire.com/news/home/20151029005124/en/

Source: Pitney Bowes Inc.

Pitney Bowes Inc.
Editorial:
Bill Hughes, 203/351-6785
Chief Communications Officer
or
Financial:
Charles F. McBride, 203/351-6349
VP, Investor Relations