Pitney Bowes Announces Third Quarter 2016 Financial Results


Pitney Bowes Inc.
Reconciliation of Reported Consolidated Results to Adjusted Results
(Unaudited; in thousands, except per share amounts)

	Three months ended September 30,							Nine months ended September 30,
	2016			2015			Y/Y Chg.	2016			2015			Y/Y Chg.

Reconciliation of reported revenue to revenue excluding currency and Market Exits
Revenue, as reported	$	839,031		$	869,541		(4%)	$	2,519,506		$	2,641,113		(5%)
Unfavorable impact on revenue due to currency		8,436			-		NM		23,157			-		NM
Revenue, excluding currency		847,467			869,541		(3%)		2,542,663			2,641,113		(4%)
Less revenue from Market Exits		(1,164	)		(8,352	)	NM		(3,703	)		(19,894	)	NM
Revenue, excluding currency and Market Exits	$	846,303		$	861,189		(2%)	$	2,538,960		$	2,621,219		(3%)


Reconciliation of reported net income to adjusted earnings
Net income	$	70,105		$	93,876			$	190,929		$	335,445
Loss from discontinued operations, net of tax		291			-				1,951			582
Restructuring charges and asset impairments, net		10,840			47				32,399			8,607
Loss (gain) on disposition of businesses		275			30				2,698			(88,399	)
Transaction costs related to acquisitions and dispositions		90			5,323				206			11,428
Legal settlement		-			(370	)			-			4,250
Investment divestiture		-			(7,756	)			-			(7,756	)
Tax cost - preferred stock redemption		4,847			-				4,847			-
Acquisition/disposition related expenses		-			-				-			7,246
Income from continuing operations, after
income taxes, as adjusted		86,448			91,150				233,030			271,403
Provision for income taxes, as adjusted		24,217			43,657				107,242			140,070
Income from continuing operations before income taxes, as adjusted		110,665			134,807				340,272			411,473
Interest, net		35,259			37,698				103,769			119,371
EBIT, as adjusted		145,924			172,505				444,041			530,844
Depreciation and amortization		50,687			42,333				140,225			127,486
EBITDA, as adjusted	$	196,611		$	214,838			$	584,266		$	658,330


Reconciliation of reported diluted earnings per share to adjusted diluted earnings per share from continuing operations
Diluted earnings per share	$	0.35		$	0.44			$	0.93		$	1.59
Loss from discontinued operations, net of tax		-			-				0.01			-
Restructuring charges and asset impairments, net		0.06			-				0.17			0.04
Loss (gain) on disposition of businesses		-			-				0.01			(0.44	)
Transaction costs related to acquisitions and dispositions		-			0.03				-			0.06
Legal settlement		-			-				-			0.02
Investment divestiture		-			(0.04	)			-			(0.04	)
Tax cost - preferred stock redemption		0.03			-				0.03			-
Acquisition/disposition related expenses		-			-				-			0.04
Diluted earnings per share from continuing
operations, as adjusted	$	0.44		$	0.43			$	1.16		$	1.28

Note : The sum of the earnings per share amounts may not equal the totals due to rounding.

Reconciliation of reported net cash from operating activities to free cash flow
Net cash provided by operating activities	$	137,342		$	150,392			$	290,929		$	351,400
Capital expenditures		(44,173	)		(40,716	)			(115,532	)		(130,328	)
Restructuring payments		17,295			15,281				51,161			46,056
Pension contribution		-			-				36,731			-
Reserve account deposits		8,956			(4,166	)			1,813			(25,630	)
Acquisition/disposition related expenses		-			-				-			10,483
Tax (receipts) payments related to investment divestiture		-			(5,773	)			-			20,602
Tax payment related to sale of Imagitas		-			15,918				-			15,918
Cash transaction fees		-			-				335			11,116

Free cash flow	$	119,420		$	130,936			$	265,437		$	299,617

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