Incorporated in Delaware
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I.R.S. Employer Identification No. 06-0495050
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3001 Summer Street, Stamford, CT 06926
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(203) 356-5000
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, $1 par value per share
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New York Stock Exchange
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$2.12 Convertible Cumulative Preference Stock (no par value)
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New York Stock Exchange
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Large accelerated filer
þ
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
¨
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Emerging growth company
¨
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Page Number
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PART I
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV
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Item 15.
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Item 16.
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•
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any potential impact from the announcement that the Board of Directors of the Company is conducting a review of strategic alternatives
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•
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declining physical mail volumes
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•
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competitive factors, including pricing pressures; technological developments and the introduction of new products and services by competitors
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•
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our success in developing new products and services, including digital-based products and services, obtaining regulatory approval if required
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•
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the market’s acceptance of new products and services
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•
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our ability to fully utilize the enterprise business platform in North America, implemented in 2016, and successfully deploy it in major international markets without significant disruption to existing operations
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•
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the continued availability and security of key information technology systems and the cost to comply with information security requirements and privacy laws
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•
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a breach of security, including a cyberattack or other comparable event
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•
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macroeconomic factors, including global and regional business conditions that adversely impact customer demand, foreign currency exchange rates, interest rates, labor conditions and fuel prices
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•
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third-party suppliers' ability to provide products and services required by our clients
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•
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our success at managing the relationships with our outsource providers, including the costs of outsourcing functions and operations not central to our business
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•
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changes in postal or banking regulations, including changes in, or loss of, our contractual relationships with the U.S. Postal Service
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•
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integrating newly acquired businesses, including operations and product and service offerings
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•
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the loss of some of our larger clients in the Global Ecommerce segment
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•
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intellectual property infringement claims
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•
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our success at managing customer credit risk
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•
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capital market disruptions or credit rating downgrades that adversely impact our ability to access capital markets at reasonable costs
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•
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significant changes in pension, health care and retiree medical costs
|
•
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income tax adjustments or other regulatory levies for prior audit years and changes in tax laws, rulings or regulations, including the impact of the Tax Cuts and Jobs Act of 2017
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•
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a disruption of our businesses due to changes in international or national political conditions, including the use of the mail for transmitting harmful biological agents or other terrorist attacks
|
•
|
acts of nature
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Name
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Age
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|
Title
|
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Executive
Officer Since
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Marc B. Lautenbach
|
|
56
|
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President and Chief Executive Officer
|
|
2012
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Jason C. Dies
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|
48
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|
Executive Vice President and President, SMB Solutions
|
|
2017
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Daniel J. Goldstein
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56
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|
Executive Vice President and Chief Legal Officer and Corporate Secretary
|
|
2010
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Robert Guidotti
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|
60
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|
Executive Vice President and President, Software Solutions
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|
2016
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Abby F. Kohnstamm
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|
64
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Executive Vice President and Chief Marketing Officer
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2013
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Michael Monahan
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57
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Executive Vice President and Chief Operating Officer
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2005
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Roger J. Pilc
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|
50
|
|
Executive Vice President and Chief Innovation Officer
|
|
2013
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Mark L. Shearer
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|
61
|
|
Executive Vice President
|
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2013
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Lila Snyder
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45
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|
Executive Vice President and President, Commerce Services
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|
2016
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Christoph Stehmann
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|
55
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|
Executive Vice President, International SMB Solutions
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|
2016
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Stanley J. Sutula III
|
|
52
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|
Executive Vice President and Chief Financial Officer
|
|
2017
|
Johnna G. Torsone
|
|
67
|
|
Executive Vice President and Chief Human Resources Officer
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|
1993
|
•
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difficulties in achieving anticipated benefits or synergies from acquisitions and divestitures;
|
•
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difficulties in integrating newly acquired businesses and operations, including combining product and service offerings and entering new markets, or reducing fixed costs previously associated with divested businesses;
|
•
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the loss of key employees or clients of businesses acquired or divested; and
|
•
|
significant charges to earnings for employee severance and other restructuring costs, goodwill and asset impairments and legal, accounting and financial advisory fees.
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|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The sum of earnings per share may not equal the totals due to rounding.
|
|
2017
|
2016
|
Change
|
|||||
Revenue
|
$
|
3,549,948
|
|
$
|
3,406,575
|
|
4
|
%
|
Income from continuing operations
|
$
|
261,340
|
|
$
|
114,551
|
|
>100%
|
|
Net income
|
$
|
261,340
|
|
$
|
92,805
|
|
>100%
|
|
Earnings per share from continuing operations - diluted
|
$
|
1.39
|
|
$
|
0.51
|
|
>100%
|
|
Net Cash Provided by Operations
|
$
|
495,813
|
|
$
|
496,122
|
|
—
|
%
|
•
|
Revenue increased
4%
, on a reported and constant currency basis reflecting growth in business services, software and equipment sales and declines in financing, support services, supplies and rentals.
|
•
|
SMB revenue declined
5%
on a reported and constant currency basis. North America Mailing revenue declined
5%
on a reported and constant currency basis driven by declines in recurring revenue streams. International Mailing revenue declined
7%
as reported and
6%
on a constant currency basis primarily due to lower equipment sales and recurring revenue streams.
|
•
|
EBS revenue increased
3%
on a reported and constant currency basis. Presort Services revenue grew
5%
driven by higher standard mail and parcel volumes and higher revenue per piece. Production Mail revenue increased
1%
as reported and was flat on a constant currency basis as the higher equipment sales were offset by lower support services revenue.
|
•
|
DCS revenue grew
32%
on a reported and constant currency basis. Global Ecommerce revenue grew
63%
on a reported and constant currency basis driven by the acquisition of Newgistics, growth in cross-border retail and marketplace volumes and growth in domestic shipping. In the fourth quarter, we stabilized our shipping APIs, which also positively impacted the growth in domestic shipping. Software Solutions revenue increased
1%
as reported and
2%
on a constant currency basis, primarily due to an increase in licensing revenue.
|
•
|
Acquire Newgistics for $471 million;
|
•
|
Spend $171 million on capital expenditures; and
|
•
|
Pay dividends of $139 million to our stockholders.
|
|
Revenue
|
|
% change
|
||||||||||||||||||||
|
Years Ended December 31,
|
|
Actual
|
|
Constant Currency
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||||
Equipment sales
|
$
|
680
|
|
|
$
|
675
|
|
|
$
|
695
|
|
|
1
|
%
|
|
(3
|
)%
|
|
—
|
%
|
|
(2
|
)%
|
Supplies
|
253
|
|
|
263
|
|
|
288
|
|
|
(4
|
)%
|
|
(9
|
)%
|
|
(4
|
)%
|
|
(7
|
)%
|
|||
Software
|
353
|
|
|
349
|
|
|
386
|
|
|
1
|
%
|
|
(10
|
)%
|
|
2
|
%
|
|
(7
|
)%
|
|||
Rentals
|
386
|
|
|
413
|
|
|
442
|
|
|
(6
|
)%
|
|
(7
|
)%
|
|
(7
|
)%
|
|
(6
|
)%
|
|||
Financing
|
331
|
|
|
366
|
|
|
410
|
|
|
(10
|
)%
|
|
(11
|
)%
|
|
(9
|
)%
|
|
(10
|
)%
|
|||
Support services
|
479
|
|
|
513
|
|
|
555
|
|
|
(7
|
)%
|
|
(8
|
)%
|
|
(7
|
)%
|
|
(7
|
)%
|
|||
Business services
|
1,068
|
|
|
828
|
|
|
802
|
|
|
29
|
%
|
|
3
|
%
|
|
29
|
%
|
|
4
|
%
|
|||
Total revenue
|
$
|
3,550
|
|
|
$
|
3,407
|
|
|
$
|
3,578
|
|
|
4
|
%
|
|
(5
|
)%
|
|
4
|
%
|
|
(4
|
)%
|
|
Cost of Revenue
|
|||||||||||||||||||
|
Years Ended December 31,
|
|||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
|
$
|
|
% of revenue
|
|
$
|
|
% of revenue
|
|
$
|
|
% of revenue
|
|||||||||
Cost of equipment sales
|
$
|
341
|
|
|
50.1
|
%
|
|
$
|
332
|
|
|
49.1
|
%
|
|
$
|
331
|
|
|
47.6
|
%
|
Cost of supplies
|
83
|
|
|
32.8
|
%
|
|
81
|
|
|
31.0
|
%
|
|
89
|
|
|
30.8
|
%
|
|||
Cost of software
|
102
|
|
|
28.9
|
%
|
|
106
|
|
|
30.4
|
%
|
|
114
|
|
|
29.4
|
%
|
|||
Cost of rentals
|
84
|
|
|
21.8
|
%
|
|
76
|
|
|
18.4
|
%
|
|
84
|
|
|
19.1
|
%
|
|||
Financing interest expense
|
51
|
|
|
15.3
|
%
|
|
55
|
|
|
15.1
|
%
|
|
72
|
|
|
17.5
|
%
|
|||
Cost of support services
|
289
|
|
|
60.4
|
%
|
|
296
|
|
|
57.7
|
%
|
|
323
|
|
|
58.2
|
%
|
|||
Cost of business services
|
773
|
|
|
72.4
|
%
|
|
569
|
|
|
68.7
|
%
|
|
546
|
|
|
68.1
|
%
|
|||
Total cost of revenue
|
$
|
1,723
|
|
|
48.5
|
%
|
|
$
|
1,515
|
|
|
44.5
|
%
|
|
$
|
1,559
|
|
|
43.6
|
%
|
•
|
1% from higher equipment sales in Production Mail; and
|
•
|
1% from higher equipment sales in North America Mailing, reflecting a favorable comparison to prior year, which was impacted by the enterprise business platform implementation in the second quarter of 2016; offset by
|
•
|
2% from lower equipment sales in International Mailing particularly in Europe.
|
•
|
3% from lower mailing equipment sales in North America, due in part to sales disruption during the second quarter from the enterprise business platform implementation; and
|
•
|
1% from the exit of certain geographic markets in 2016 (Market Exits); partially offset by
|
•
|
2% from higher sales in our production mail business, primarily due to higher installations of sorter, inserter and print equipment.
|
•
|
4% from lower North America mailing supplies sales;
|
•
|
1% from lower international mailing supplies, primarily in the U.K. and France;
|
•
|
1% from lower sales in our production mail business; and
|
•
|
1% from Market Exits.
|
•
|
6% from a decline in installed mailing equipment worldwide; and
|
•
|
1% from lower maintenance revenue on Production Mail equipment as some in-house mailers in the prior year moved their mail processing to third-party service bureaus who service their own equipment.
|
•
|
2% from lower maintenance revenue on production mail equipment as some in-house mailers moved their mail processing to third-party service bureaus who service some of their own equipment;
|
•
|
2% from the worldwide decline in the number of mailing machines in service and shift to less-featured, lower cost machines; and
|
•
|
2% from Market Exits.
|
•
|
17% from the acquisition of Newgistics;
|
•
|
9% from growth in Global Ecommerce due to higher cross-border and retail volumes; and
|
•
|
3% from higher volumes of mail processed in Presort Services.
|
•
|
10% from growth in our Ecommerce business from the expansion of our U.S. and U.K. cross-border marketplace business and retail network, including a full year of operations of Borderfree; and
|
•
|
1% from higher shipping solutions services.
|
|
Revenue
|
|
% change
|
||||||||||||||||||||
|
Years Ended December 31,
|
|
Actual
|
|
Constant Currency
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||||
North America Mailing
|
$
|
1,357
|
|
|
$
|
1,427
|
|
|
$
|
1,530
|
|
|
(5
|
)%
|
|
(7
|
)%
|
|
(5
|
)%
|
|
(7
|
)%
|
International Mailing
|
384
|
|
|
412
|
|
|
450
|
|
|
(7
|
)%
|
|
(8
|
)%
|
|
(6
|
)%
|
|
(5
|
)%
|
|||
Small & Medium Business Solutions
|
1,740
|
|
|
1,839
|
|
|
1,980
|
|
|
(5
|
)%
|
|
(7
|
)%
|
|
(5
|
)%
|
|
(6
|
)%
|
|||
Production Mail
|
407
|
|
|
405
|
|
|
421
|
|
|
1
|
%
|
|
(4
|
)%
|
|
—
|
%
|
|
(3
|
)%
|
|||
Presort Services
|
498
|
|
|
476
|
|
|
474
|
|
|
5
|
%
|
|
—
|
%
|
|
5
|
%
|
|
—
|
%
|
|||
Enterprise Business Solutions
|
905
|
|
|
881
|
|
|
895
|
|
|
3
|
%
|
|
(2
|
)%
|
|
3
|
%
|
|
(1
|
)%
|
|||
Software Solutions
|
352
|
|
|
348
|
|
|
386
|
|
|
1
|
%
|
|
(10
|
)%
|
|
2
|
%
|
|
(7
|
)%
|
|||
Global Ecommerce
|
552
|
|
|
339
|
|
|
263
|
|
|
63
|
%
|
|
29
|
%
|
|
63
|
%
|
|
31
|
%
|
|||
Digital Commerce Solutions
|
905
|
|
|
688
|
|
|
649
|
|
|
32
|
%
|
|
6
|
%
|
|
32
|
%
|
|
8
|
%
|
|||
Other
|
—
|
|
|
—
|
|
|
55
|
|
|
—
|
%
|
|
(100
|
)%
|
|
—
|
%
|
|
(100
|
)%
|
|||
Total
|
$
|
3,550
|
|
|
$
|
3,407
|
|
|
$
|
3,578
|
|
|
4
|
%
|
|
(5
|
)%
|
|
4
|
%
|
|
(4
|
)%
|
|
EBIT
|
||||||||||||||||
|
Years Ended December 31,
|
|
% change
|
||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
||||||||
North America Mailing
|
$
|
498
|
|
|
$
|
593
|
|
|
$
|
663
|
|
|
(16
|
)%
|
|
(11
|
)%
|
International Mailing
|
48
|
|
|
45
|
|
|
49
|
|
|
7
|
%
|
|
(9
|
)%
|
|||
Small & Medium Business Solutions
|
546
|
|
|
638
|
|
|
712
|
|
|
(14
|
)%
|
|
(10
|
)%
|
|||
Production Mail
|
51
|
|
|
54
|
|
|
48
|
|
|
(7
|
)%
|
|
12
|
%
|
|||
Presort Services
|
98
|
|
|
95
|
|
|
105
|
|
|
2
|
%
|
|
(9
|
)%
|
|||
Enterprise Business Solutions
|
148
|
|
|
149
|
|
|
153
|
|
|
(1
|
)%
|
|
(2
|
)%
|
|||
Software Solutions
|
42
|
|
|
30
|
|
|
49
|
|
|
38
|
%
|
|
(38
|
)%
|
|||
Global Ecommerce
|
(18
|
)
|
|
3
|
|
|
5
|
|
|
> (100)%
|
|
|
(40
|
)%
|
|||
Digital Commerce Solutions
|
24
|
|
|
33
|
|
|
54
|
|
|
(29
|
)%
|
|
(38
|
)%
|
|||
Other
|
—
|
|
|
—
|
|
|
10
|
|
|
—
|
%
|
|
(100
|
)%
|
|||
Total
|
$
|
718
|
|
|
$
|
820
|
|
|
$
|
929
|
|
|
(13
|
)%
|
|
(12
|
)%
|
•
|
3% from declines in rentals and support services revenue due to a decline in installed mailing equipment and lower postage volumes; and
|
•
|
2% from lower financing revenue primarily due to a declining lease portfolio and lower fee income.
|
•
|
2% from lower financing revenue primarily from declining equipment sales in prior periods and lower fees resulting from proactive waivers to allow clients to adjust to new billing formats and delayed timing of invoices resulting from the platform cutover;
|
•
|
1% from lower sales of supplies due to lower demand and sales productivity issues from the platform cutover;
|
•
|
1% from lower rentals revenue and 1% from lower support services revenue, primarily reflecting continuing decline in installed meters and shift to less-featured lower-cost machines; and
|
•
|
1% from lower equipment sales which were impacted by sales productivity issues from the platform cutover.
|
•
|
3% from lower equipment sales particularly in Europe; and
|
•
|
3% from declines in rentals, financing and support services revenue resulting from a decline in installed mailing equipment and the lease portfolio.
|
•
|
2% from Market Exits; and
|
•
|
1% decline in each of rental, supplies and support services revenue resulting from the continued decline in installed meters.
|
•
|
1% from higher equipment sales as a significant deal for printers and sorters closed and were installed in the fourth quarter of 2017; partially offset by
|
•
|
1% from lower support services revenue as result of some in-house mailers shifting their mail processing to third-party outsourcers who service their own equipment in the prior year.
|
•
|
3% from Market Exits; and
|
•
|
3% from lower support services revenue as result of some in-house mailers shifting their mail processing to third-party outsourcers; partially offset by
|
•
|
4% from higher equipment sales due to higher installations of sorter, inserter and print equipment.
|
•
|
41% from the acquisition of Newgistics;
|
•
|
12% from higher domestic ecommerce shipping revenues;
|
•
|
6% from higher cross-border marketplace volumes, particularly in the UK; and
|
•
|
4% from higher retail volumes.
|
|
Years Ended December 31,
|
|
Change
|
||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
||||||||||
Net cash provided by operating activities
|
$
|
496
|
|
|
$
|
496
|
|
|
$
|
523
|
|
|
$
|
—
|
|
|
$
|
(27
|
)
|
Net cash used in investing activities
|
(663
|
)
|
|
(116
|
)
|
|
(303
|
)
|
|
(547
|
)
|
|
187
|
|
|||||
Net cash provided by (used in) financing activities
|
368
|
|
|
(230
|
)
|
|
(579
|
)
|
|
598
|
|
|
349
|
|
|||||
Effect of exchange rate changes on cash and cash equivalents
|
44
|
|
|
(27
|
)
|
|
(44
|
)
|
|
71
|
|
|
17
|
|
|||||
Change in cash and cash equivalents
|
$
|
244
|
|
|
$
|
124
|
|
|
$
|
(403
|
)
|
|
$
|
122
|
|
|
$
|
526
|
|
•
|
Lower income;
|
•
|
A special pension plan contribution of $37 million to the U.K. pension plan; and
|
•
|
Payments associated with the launch of the enterprise business platform and new advertising campaign; partially offset by
|
•
|
Lower employee related costs and income tax payments.
|
•
|
Higher acquisitions spending of $445 million;
|
•
|
Lower cash from investment activities of $94 million;
|
•
|
Lower proceeds from asset sales of $12 million;
|
•
|
Higher capital expenditures of $10 million; partially offset by
|
•
|
An increase in reserve deposits of $13 million.
|
•
|
Lower acquisitions spending of $356 million;
|
•
|
Higher cash from investment activities of $142 million;
|
•
|
An increase in reserve deposits of $22 million; and
|
•
|
Lower capital expenditures of $6 million; partially offset by
|
•
|
Proceeds of $292 million from the sale of Imagitas in 2015; and
|
•
|
Lower proceeds from asset sales of $34 million.
|
•
|
The payment of $300 million in 2016 to redeem a noncontrolling interest;
|
•
|
Share repurchases of $197 million in 2016;
|
•
|
Higher net cash flows from debt activities of $38 million; and
|
•
|
In 2017, other financing activities of $35 million includes $46 million related to a timing difference between our investing excess cash at a subsidiary level and our funding of an intercompany cash transfer. This amount was partially offset by payments related to the early extinguishment of debt and withholding tax associated with stock-based compensation.
|
•
|
Higher cash from debt activities of $709 million as we had net borrowings of debt of $434 million in 2017 compared to net repayments of debt of $275 million in 2016; partially offset by
|
•
|
Redemption of noncontrolling interests for $300 million; and
|
•
|
Higher share repurchases of $65 million.
|
|
Payments due in
|
||||||||||||||||||
|
Total
|
|
2018
|
|
2019-20
|
|
2021-22
|
|
After 2022
|
||||||||||
Debt maturities
|
$
|
3,866
|
|
|
$
|
270
|
|
|
$
|
1,230
|
|
|
$
|
1,000
|
|
|
$
|
1,366
|
|
Interest payments on debt
(1)
|
1,293
|
|
|
167
|
|
|
287
|
|
|
191
|
|
|
648
|
|
|||||
Noncancelable operating lease obligations
|
218
|
|
|
48
|
|
|
69
|
|
|
38
|
|
|
64
|
|
|||||
Purchase obligations (2)
|
241
|
|
|
202
|
|
|
31
|
|
|
4
|
|
|
4
|
|
|||||
Pension plan contributions (3)
|
19
|
|
|
19
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Retiree medical payments (4)
|
146
|
|
|
18
|
|
|
34
|
|
|
31
|
|
|
63
|
|
|||||
Total
|
$
|
5,783
|
|
|
$
|
724
|
|
|
$
|
1,651
|
|
|
$
|
1,264
|
|
|
$
|
2,145
|
|
(1)
|
Assumes all debt is held to maturity.
|
(2)
|
Includes unrecorded agreements to purchase goods and services that are enforceable and legally binding upon us and that specify all significant terms, including fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction. Purchase obligations exclude agreements that are cancelable without penalty.
|
(3)
|
Represents the amount of contributions we anticipate making to our pension plans during 2018. We will assess our funding alternatives as the year progresses and this amount is subject to change.
|
(4)
|
Our retiree health benefit plans are nonfunded plans and cash contributions are made each year to cover medical claims costs incurred. The amounts reported in the above table represent our estimate of future payments.
|
Plan Category
|
|
(a)
Number of securities to be issued upon exercise of outstanding options, warrants and rights
|
|
(b)
Weighted-average exercise price of outstanding options, warrants and rights
|
|
(c)
Number of securities remaining available for future issuance under equity compensation plans excluding securities reflected in column (a)
|
|||
Equity compensation plans approved by security holders
|
|
10,495,039
|
|
|
$21.67
|
|
15,725,806
|
|
|
Equity compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
|
10,495,039
|
|
|
$21.67
|
|
15,725,806
|
|
(a)
|
1. Financial statements - see "Index to Consolidated Financial Statements and Supplemental Data" on
page 41
of this Form 10-K.
|
Reg. S-K
exhibits
|
Description
|
Status or incorporation by reference
|
3(a)
|
Restated Certificate of Incorporation of Pitney Bowes Inc.
|
|
3(b)
|
Pitney Bowes Inc. Amended and Restated By-laws (effective May 10, 2013)
|
|
4(a)
|
Form of Indenture between the Company and SunTrust Bank, as Trustee
|
|
4(b)
|
Supplemental Indenture No. 1 dated April 18, 2003 between the Company and SunTrust Bank, as Trustee
|
|
4(d)
|
First Supplemental Indenture, by and among Pitney Bowes Inc., The Bank of New York, and Citibank, N.A., to the Indenture, dated as of February 14, 2005, by and between the Company and Citibank
|
|
10(a) *
|
Retirement Plan for Directors of Pitney Bowes Inc.
|
|
10(b.3) *
|
Pitney Bowes Inc. Directors' Stock Plan (Amended and Restated effective May 12, 2014)
|
|
10(c) *
|
Pitney Bowes Stock Plan (as amended and restated as of January 1, 2002)
|
|
10(d) *
|
Pitney Bowes Inc. 2007 Stock Plan (as amended November 7, 2009)
|
|
10(e) *
|
Pitney Bowes Inc. Key Employees' Incentive Plan (as amended and restated October 1, 2007) (as amended November 7, 2009)
|
|
10(f) *
|
Pitney Bowes Severance Plan (as amended and restated as of January 1, 2008)
|
|
10(g) *
|
Pitney Bowes Senior Executive Severance Policy (as amended and restated as of September 11, 2017)
|
|
10(h) *
|
Pitney Bowes Inc. Deferred Incentive Savings Plan for the Board of Directors, as amended and restated effective January 1, 2009
|
|
10(i) *
|
Pitney Bowes Inc. Deferred Incentive Savings Plan as amended and restated effective January 1, 2009
|
|
10(j) *
|
Pitney Bowes Inc. 1998 U.K. S.A.Y.E. Stock Option Plan
|
|
10(k) *
|
Form of Long Term Incentive Award Agreement
|
|
10(l) **
|
Agreement and Plan of Merger, dated as of September 6, 2017, among Pitney Bowes Inc., Neutron Acquisition Corp., NGS Holdings, Inc. and Littlejohn Fund IV, L.P., solely in its capacity as stockholder representative
|
|
|
Page Number
|
|
|
|
Consolidated Financial Statements of Pitney Bowes Inc.
|
|
|
|
Consolidated Statements of Income for the Years Ended December 31, 20
17, 2016 and 2015
|
|
|
||
|
||
|
||
|
||
|
||
Financial Statement Schedule
|
|
|
|
||
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Revenue:
|
|
|
|
|
|
|
|
||||
Equipment sales
|
$
|
679,803
|
|
|
$
|
675,451
|
|
|
$
|
695,159
|
|
Supplies
|
252,824
|
|
|
262,682
|
|
|
288,103
|
|
|||
Software
|
352,595
|
|
|
348,661
|
|
|
386,506
|
|
|||
Rentals
|
386,348
|
|
|
412,738
|
|
|
441,663
|
|
|||
Financing
|
331,416
|
|
|
366,547
|
|
|
410,035
|
|
|||
Support services
|
478,536
|
|
|
512,820
|
|
|
554,764
|
|
|||
Business services
|
1,068,426
|
|
|
827,676
|
|
|
801,830
|
|
|||
Total revenue
|
3,549,948
|
|
|
3,406,575
|
|
|
3,578,060
|
|
|||
Costs and expenses:
|
|
|
|
|
|
|
|
||||
Cost of equipment sales
|
340,745
|
|
|
331,942
|
|
|
331,069
|
|
|||
Cost of supplies
|
82,992
|
|
|
81,420
|
|
|
88,802
|
|
|||
Cost of software
|
101,969
|
|
|
105,841
|
|
|
113,580
|
|
|||
Cost of rentals
|
84,270
|
|
|
76,040
|
|
|
84,188
|
|
|||
Financing interest expense
|
50,665
|
|
|
55,241
|
|
|
71,791
|
|
|||
Cost of support services
|
288,976
|
|
|
295,685
|
|
|
322,960
|
|
|||
Cost of business services
|
773,052
|
|
|
568,509
|
|
|
546,201
|
|
|||
Selling, general and administrative
|
1,237,739
|
|
|
1,200,327
|
|
|
1,279,961
|
|
|||
Research and development
|
129,767
|
|
|
121,306
|
|
|
110,156
|
|
|||
Restructuring charges and asset impairments, net
|
59,431
|
|
|
63,296
|
|
|
25,782
|
|
|||
Goodwill impairment
|
—
|
|
|
171,092
|
|
|
—
|
|
|||
Interest expense, net
|
113,497
|
|
|
88,970
|
|
|
87,583
|
|
|||
Other expense (income), net
|
3,856
|
|
|
536
|
|
|
(94,838
|
)
|
|||
Total costs and expenses
|
3,266,959
|
|
|
3,160,205
|
|
|
2,967,235
|
|
|||
Income from continuing operations before income taxes
|
282,989
|
|
|
246,370
|
|
|
610,825
|
|
|||
Provision for income taxes
|
21,649
|
|
|
131,819
|
|
|
189,778
|
|
|||
Income from continuing operations
|
261,340
|
|
|
114,551
|
|
|
421,047
|
|
|||
(Loss) income from discontinued operations, net of tax
|
—
|
|
|
(2,701
|
)
|
|
5,271
|
|
|||
Net income
|
261,340
|
|
|
111,850
|
|
|
426,318
|
|
|||
Less: Preferred stock dividends of subsidiaries attributable to noncontrolling interests
|
—
|
|
|
19,045
|
|
|
18,375
|
|
|||
Net income - Pitney Bowes Inc.
|
$
|
261,340
|
|
|
$
|
92,805
|
|
|
$
|
407,943
|
|
Amounts attributable to common stockholders:
|
|
|
|
|
|
|
|
||||
Net income from continuing operations
|
$
|
261,340
|
|
|
$
|
95,506
|
|
|
$
|
402,672
|
|
(Loss) income from discontinued operations, net of tax
|
—
|
|
|
(2,701
|
)
|
|
5,271
|
|
|||
Net income - Pitney Bowes Inc.
|
$
|
261,340
|
|
|
$
|
92,805
|
|
|
$
|
407,943
|
|
Basic earnings per share attributable to common stockholders
(1)
:
|
|
|
|
|
|
|
|
||||
Continuing operations
|
$
|
1.40
|
|
|
$
|
0.51
|
|
|
$
|
2.01
|
|
Discontinued operations
|
—
|
|
|
(0.01
|
)
|
|
0.03
|
|
|||
Net income - Pitney Bowes Inc.
|
$
|
1.40
|
|
|
$
|
0.49
|
|
|
$
|
2.04
|
|
Diluted earnings per share attributable to common stockholders
(1)
:
|
|
|
|
|
|
|
|
||||
Continuing operations
|
$
|
1.39
|
|
|
$
|
0.51
|
|
|
$
|
2.00
|
|
Discontinued operations
|
—
|
|
|
(0.01
|
)
|
|
0.03
|
|
|||
Net income - Pitney Bowes Inc.
|
$
|
1.39
|
|
|
$
|
0.49
|
|
|
$
|
2.03
|
|
|
|
|
|
|
|
||||||
Dividends declared per share of common stock
|
$
|
0.75
|
|
|
$
|
0.75
|
|
|
$
|
0.75
|
|
(1)
|
The sum of the earnings per share amounts may not equal the totals due to rounding.
|
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
|
|
|
||||||
Net income
|
$
|
261,340
|
|
|
$
|
111,850
|
|
|
$
|
426,318
|
|
Less: Preferred stock dividends attributable to noncontrolling interests
|
—
|
|
|
19,045
|
|
|
18,375
|
|
|||
Net income - Pitney Bowes Inc.
|
261,340
|
|
|
92,805
|
|
|
407,943
|
|
|||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Foreign currency translations
|
106,391
|
|
|
(4,464
|
)
|
|
(88,137
|
)
|
|||
Net unrealized gain on cash flow hedges, net of tax of $678, $1,513, and $484, respectively
|
1,079
|
|
|
2,427
|
|
|
777
|
|
|||
Net unrealized gain (loss) on available for sale securities, net of tax of $944, $(244) and $(1,427), respectively
|
1,477
|
|
|
(416
|
)
|
|
(2,430
|
)
|
|||
Adjustments to pension and postretirement plans, net of tax of $3,089, $(17,550) and $13,844, respectively
|
12,185
|
|
|
(73,141
|
)
|
|
19,146
|
|
|||
Amortization of pension and postretirement costs, net of tax of $13,936, $14,430, and $15,966, respectively
|
26,828
|
|
|
24,096
|
|
|
28,165
|
|
|||
Other comprehensive income (loss)
|
147,960
|
|
|
(51,498
|
)
|
|
(42,479
|
)
|
|||
Comprehensive income - Pitney Bowes Inc.
|
$
|
409,300
|
|
|
$
|
41,307
|
|
|
$
|
365,464
|
|
|
December 31, 2017
|
|
December 31, 2016
|
||||
ASSETS
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
1,009,021
|
|
|
$
|
764,522
|
|
Short-term investments
|
48,988
|
|
|
38,448
|
|
||
Accounts receivable (net of allowance of $15,985 and $14,372 respectively)
|
524,424
|
|
|
455,527
|
|
||
Short-term finance receivables (net of allowance of $12,187 and $13,323, respectively)
|
828,003
|
|
|
893,950
|
|
||
Inventories
|
89,679
|
|
|
92,726
|
|
||
Current income taxes
|
58,439
|
|
|
11,373
|
|
||
Other current assets and prepayments
|
77,954
|
|
|
68,637
|
|
||
Total current assets
|
2,636,508
|
|
|
2,325,183
|
|
||
Property, plant and equipment, net
|
379,044
|
|
|
314,603
|
|
||
Rental property and equipment, net
|
185,741
|
|
|
188,054
|
|
||
Long-term finance receivables (net of allowance of $6,446 and $7,177, respectively)
|
652,087
|
|
|
673,207
|
|
||
Goodwill
|
1,952,444
|
|
|
1,571,335
|
|
||
Intangible assets, net
|
272,186
|
|
|
165,172
|
|
||
Noncurrent income taxes
|
59,909
|
|
|
74,806
|
|
||
Other assets
|
540,796
|
|
|
524,773
|
|
||
Total assets
|
$
|
6,678,715
|
|
|
$
|
5,837,133
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
|
|
|
|
|
|||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable and accrued liabilities
|
$
|
1,486,741
|
|
|
$
|
1,378,822
|
|
Current income taxes
|
8,823
|
|
|
34,434
|
|
||
Current portion of long-term obligations
|
271,057
|
|
|
614,485
|
|
||
Advance billings
|
288,372
|
|
|
299,878
|
|
||
Total current liabilities
|
2,054,993
|
|
|
2,327,619
|
|
||
Deferred taxes on income
|
234,643
|
|
|
204,289
|
|
||
Tax uncertainties and other income tax liabilities
|
116,551
|
|
|
61,276
|
|
||
Long-term debt
|
3,559,278
|
|
|
2,750,405
|
|
||
Other noncurrent liabilities
|
524,689
|
|
|
597,204
|
|
||
Total liabilities
|
6,490,154
|
|
|
5,940,793
|
|
||
|
|
|
|
||||
Commitments and contingencies (See Note 14)
|
|
|
|
|
|
||
|
|
|
|
||||
Stockholders' equity (deficit):
|
|
|
|
||||
Cumulative preferred stock, $50 par value, 4% convertible
|
1
|
|
|
1
|
|
||
Cumulative preference stock, no par value, $2.12 convertible
|
441
|
|
|
483
|
|
||
Common stock, $1 par value (480,000,000 shares authorized; 323,337,912 shares issued)
|
323,338
|
|
|
323,338
|
|
||
Additional paid-in capital
|
138,367
|
|
|
148,125
|
|
||
Retained earnings
|
5,229,584
|
|
|
5,107,734
|
|
||
Accumulated other comprehensive loss
|
(792,173
|
)
|
|
(940,133
|
)
|
||
Treasury stock, at cost (136,734,174 and 137,669,194 shares, respectively)
|
(4,710,997
|
)
|
|
(4,743,208
|
)
|
||
Total Pitney Bowes Inc. stockholders’ equity (deficit)
|
188,561
|
|
|
(103,660
|
)
|
||
Total liabilities and stockholders’ equity (deficit)
|
$
|
6,678,715
|
|
|
$
|
5,837,133
|
|
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
||||
Net income
|
$
|
261,340
|
|
|
$
|
111,850
|
|
|
$
|
426,318
|
|
Restructuring payments
|
(40,804
|
)
|
|
(64,930
|
)
|
|
(62,086
|
)
|
|||
Special pension plan contribution
|
—
|
|
|
(36,731
|
)
|
|
—
|
|
|||
Net tax payments from other investments
|
—
|
|
|
—
|
|
|
(20,602
|
)
|
|||
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
||||
Restructuring charges and asset impairments
|
59,431
|
|
|
63,296
|
|
|
25,782
|
|
|||
Goodwill impairment
|
—
|
|
|
171,092
|
|
|
—
|
|
|||
Depreciation and amortization
|
182,336
|
|
|
178,486
|
|
|
173,312
|
|
|||
Loss (gain) on sale of businesses
|
—
|
|
|
5,786
|
|
|
(105,826
|
)
|
|||
Gain on sale of technology
|
(6,085
|
)
|
|
—
|
|
|
—
|
|
|||
Gain on sale of leveraged lease assets, net of tax
|
—
|
|
|
—
|
|
|
(2,152
|
)
|
|||
Gain on debt forgiveness
|
—
|
|
|
(10,000
|
)
|
|
—
|
|
|||
Stock-based compensation
|
24,389
|
|
|
14,882
|
|
|
21,049
|
|
|||
Deferred tax (benefit) provision
|
(23,882
|
)
|
|
3,940
|
|
|
40,184
|
|
|||
Changes in operating assets and liabilities, net of acquisitions/divestitures:
|
|
|
|
|
|
|
|
||||
(Increase) decrease in accounts receivable
|
(20,590
|
)
|
|
22,559
|
|
|
(35,925
|
)
|
|||
Decrease in finance receivables
|
125,991
|
|
|
119,883
|
|
|
95,341
|
|
|||
Decrease (increase) in inventories
|
5,565
|
|
|
(6,995
|
)
|
|
(7,621
|
)
|
|||
Decrease (increase) in other current assets and prepayments
|
8,743
|
|
|
7,260
|
|
|
(10,557
|
)
|
|||
Decrease in accounts payable and accrued liabilities
|
(14,084
|
)
|
|
(59,450
|
)
|
|
(94,722
|
)
|
|||
(Decrease) increase in current and non-current income taxes
|
(16,013
|
)
|
|
(1,035
|
)
|
|
21,567
|
|
|||
(Decrease) increase in advance billings
|
(26,029
|
)
|
|
(40,248
|
)
|
|
1,344
|
|
|||
Other, net
|
(24,495
|
)
|
|
16,477
|
|
|
57,583
|
|
|||
Net cash provided by operating activities
|
495,813
|
|
|
496,122
|
|
|
522,989
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||
Purchases of available-for-sale securities
|
(125,055
|
)
|
|
(212,810
|
)
|
|
(205,256
|
)
|
|||
Proceeds from sales/maturities of available-for-sale securities
|
113,501
|
|
|
211,696
|
|
|
207,063
|
|
|||
Net change in short-term and other investments
|
(8,284
|
)
|
|
75,654
|
|
|
(69,017
|
)
|
|||
Capital expenditures
|
(170,990
|
)
|
|
(160,831
|
)
|
|
(166,746
|
)
|
|||
Proceeds from sale of assets
|
5,458
|
|
|
17,671
|
|
|
52,110
|
|
|||
Reserve account deposits
|
10,954
|
|
|
(2,183
|
)
|
|
(24,202
|
)
|
|||
Proceeds from sale of businesses, net of cash transferred
|
—
|
|
|
—
|
|
|
289,211
|
|
|||
Acquisitions, net of cash acquired
|
(482,853
|
)
|
|
(37,842
|
)
|
|
(393,695
|
)
|
|||
Other investing activities
|
(5,751
|
)
|
|
(6,908
|
)
|
|
7,339
|
|
|||
Net cash used in investing activities
|
(663,020
|
)
|
|
(115,553
|
)
|
|
(303,193
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||
Proceeds from issuance of long-term debt
|
1,436,660
|
|
|
894,744
|
|
|
150,950
|
|
|||
Principal payments of long-term obligations
|
(964,550
|
)
|
|
(371,007
|
)
|
|
(516,070
|
)
|
|||
(Decrease) increase in short-term borrowings
|
—
|
|
|
(90,000
|
)
|
|
90,000
|
|
|||
Dividends paid to stockholders
|
(139,490
|
)
|
|
(140,608
|
)
|
|
(150,114
|
)
|
|||
Dividends paid to noncontrolling interests
|
—
|
|
|
(18,528
|
)
|
|
(18,375
|
)
|
|||
Common stock repurchases
|
—
|
|
|
(197,267
|
)
|
|
(131,719
|
)
|
|||
Redemption of noncontrolling interests
|
—
|
|
|
(300,000
|
)
|
|
—
|
|
|||
Other financing activities
|
35,127
|
|
|
(6,863
|
)
|
|
(3,330
|
)
|
|||
Net cash provided by (used in) financing activities
|
367,747
|
|
|
(229,529
|
)
|
|
(578,658
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
43,959
|
|
|
(26,708
|
)
|
|
(44,387
|
)
|
|||
Increase (decrease) in cash and cash equivalents
|
244,499
|
|
|
124,332
|
|
|
(403,249
|
)
|
|||
Cash and cash equivalents at beginning of period
|
764,522
|
|
|
640,190
|
|
|
1,043,439
|
|
|||
Cash and cash equivalents at end of period
|
$
|
1,009,021
|
|
|
$
|
764,522
|
|
|
$
|
640,190
|
|
Cash interest paid
|
$
|
169,279
|
|
|
$
|
150,567
|
|
|
$
|
165,287
|
|
Cash income tax payments, net of refunds
|
$
|
53,247
|
|
|
$
|
127,299
|
|
|
$
|
138,877
|
|
|
Preferred
stock
|
|
Preference
stock
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Retained earnings
|
|
Accumulated other comprehensive loss
|
|
Treasury stock
|
|
Total equity
|
||||||||||||||||
Balance at December 31, 2014
|
$
|
1
|
|
|
$
|
548
|
|
|
$
|
323,338
|
|
|
$
|
178,852
|
|
|
$
|
4,897,708
|
|
|
$
|
(846,156
|
)
|
|
$
|
(4,477,032
|
)
|
|
$
|
77,259
|
|
Net income - Pitney Bowes Inc.
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
407,943
|
|
|
—
|
|
|
—
|
|
|
407,943
|
|
||||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42,479
|
)
|
|
—
|
|
|
(42,479
|
)
|
||||||||
Cash dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Common
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(150,073
|
)
|
|
—
|
|
|
—
|
|
|
(150,073
|
)
|
||||||||
Preference
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(41
|
)
|
|
—
|
|
|
—
|
|
|
(41
|
)
|
||||||||
Issuances of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(37,705
|
)
|
|
—
|
|
|
—
|
|
|
34,487
|
|
|
(3,218
|
)
|
||||||||
Conversions to common stock
|
|
|
(43
|
)
|
|
—
|
|
|
(916
|
)
|
|
—
|
|
|
—
|
|
|
959
|
|
|
—
|
|
|||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
21,049
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,049
|
|
||||||||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(131,719
|
)
|
|
(131,719
|
)
|
||||||||
Balance at December 31, 2015
|
1
|
|
|
505
|
|
|
323,338
|
|
|
161,280
|
|
|
5,155,537
|
|
|
(888,635
|
)
|
|
(4,573,305
|
)
|
|
178,721
|
|
||||||||
Net income - Pitney Bowes Inc.
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
92,805
|
|
|
—
|
|
|
—
|
|
|
92,805
|
|
||||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(51,498
|
)
|
|
—
|
|
|
(51,498
|
)
|
||||||||
Cash dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Common
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(140,570
|
)
|
|
—
|
|
|
—
|
|
|
(140,570
|
)
|
||||||||
Preference
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
||||||||
Issuances of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(27,856
|
)
|
|
—
|
|
|
—
|
|
|
26,886
|
|
|
(970
|
)
|
||||||||
Conversions to common stock
|
—
|
|
|
(22
|
)
|
|
—
|
|
|
(456
|
)
|
|
—
|
|
|
—
|
|
|
478
|
|
|
—
|
|
||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
15,157
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,157
|
|
||||||||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(197,267
|
)
|
|
(197,267
|
)
|
||||||||
Balance at December 31, 2016
|
1
|
|
|
483
|
|
|
323,338
|
|
|
148,125
|
|
|
5,107,734
|
|
|
(940,133
|
)
|
|
(4,743,208
|
)
|
|
(103,660
|
)
|
||||||||
Net income - Pitney Bowes Inc.
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
261,340
|
|
|
—
|
|
|
—
|
|
|
261,340
|
|
||||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
147,960
|
|
|
—
|
|
|
147,960
|
|
||||||||
Cash dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Common
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(139,454
|
)
|
|
—
|
|
|
—
|
|
|
(139,454
|
)
|
||||||||
Preference
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(36
|
)
|
|
—
|
|
|
—
|
|
|
(36
|
)
|
||||||||
Issuances of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(33,316
|
)
|
|
—
|
|
|
—
|
|
|
31,338
|
|
|
(1,978
|
)
|
||||||||
Conversions to common stock
|
—
|
|
|
(42
|
)
|
|
—
|
|
|
(831
|
)
|
|
—
|
|
|
—
|
|
|
873
|
|
|
—
|
|
||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
24,389
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24,389
|
|
||||||||
Balance at December 31, 2017
|
$
|
1
|
|
|
$
|
441
|
|
|
$
|
323,338
|
|
|
$
|
138,367
|
|
|
$
|
5,229,584
|
|
|
$
|
(792,173
|
)
|
|
$
|
(4,710,997
|
)
|
|
$
|
188,561
|
|
|
Revenues
|
||||||||||
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
North America Mailing
|
$
|
1,356,561
|
|
|
$
|
1,427,094
|
|
|
$
|
1,530,060
|
|
International Mailing
|
383,670
|
|
|
411,642
|
|
|
449,828
|
|
|||
Small & Medium Business Solutions
|
1,740,231
|
|
|
1,838,736
|
|
|
1,979,888
|
|
|||
Production Mail
|
407,194
|
|
|
404,703
|
|
|
421,178
|
|
|||
Presort Services
|
497,901
|
|
|
475,582
|
|
|
473,612
|
|
|||
Enterprise Business Solutions
|
905,095
|
|
|
880,285
|
|
|
894,790
|
|
|||
Software Solutions
|
352,380
|
|
|
348,234
|
|
|
385,908
|
|
|||
Global Ecommerce
|
552,242
|
|
|
339,320
|
|
|
262,667
|
|
|||
Digital Commerce Solutions
|
904,622
|
|
|
687,554
|
|
|
648,575
|
|
|||
Other
|
—
|
|
|
—
|
|
|
54,807
|
|
|||
Total revenue
|
$
|
3,549,948
|
|
|
$
|
3,406,575
|
|
|
$
|
3,578,060
|
|
|
|
|
|
|
|
||||||
Geographic data:
|
|
|
|
|
|
||||||
United States
|
$
|
2,738,711
|
|
|
$
|
2,589,535
|
|
|
$
|
2,681,285
|
|
Outside United States
|
811,237
|
|
|
817,040
|
|
|
896,775
|
|
|||
Total
|
$
|
3,549,948
|
|
|
$
|
3,406,575
|
|
|
$
|
3,578,060
|
|
|
EBIT
|
||||||||||
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
North America Mailing
|
$
|
497,809
|
|
|
$
|
592,978
|
|
|
$
|
663,031
|
|
International Mailing
|
48,164
|
|
|
44,806
|
|
|
49,071
|
|
|||
Small & Medium Business Solutions
|
545,973
|
|
|
637,784
|
|
|
712,102
|
|
|||
Production Mail
|
50,513
|
|
|
54,061
|
|
|
48,254
|
|
|||
Presort Services
|
97,506
|
|
|
95,258
|
|
|
104,655
|
|
|||
Enterprise Business Solutions
|
148,019
|
|
|
149,319
|
|
|
152,909
|
|
|||
Software Solutions
|
41,635
|
|
|
30,159
|
|
|
48,531
|
|
|||
Global Ecommerce
|
(17,899
|
)
|
|
3,043
|
|
|
5,110
|
|
|||
Digital Commerce Solutions
|
23,736
|
|
|
33,202
|
|
|
53,641
|
|
|||
Other
|
—
|
|
|
—
|
|
|
10,569
|
|
|||
Total EBIT
|
717,728
|
|
|
820,305
|
|
|
929,221
|
|
|||
Reconciling items:
|
|
|
|
|
|
|
|
||||
Interest, net
|
(164,162
|
)
|
|
(144,211
|
)
|
|
(159,374
|
)
|
|||
Unallocated corporate expenses
|
(204,211
|
)
|
|
(189,215
|
)
|
|
(213,095
|
)
|
|||
Goodwill impairment
|
—
|
|
|
(171,092
|
)
|
|
—
|
|
|||
Restructuring charges and asset impairments, net
|
(59,431
|
)
|
|
(63,296
|
)
|
|
(25,782
|
)
|
|||
Gain on sale of technology
|
6,085
|
|
|
—
|
|
|
—
|
|
|||
Acquisition/disposition related expenses
|
(9,164
|
)
|
|
(5,585
|
)
|
|
(14,983
|
)
|
|||
Other (expense) income, net
|
(3,856
|
)
|
|
(536
|
)
|
|
94,838
|
|
|||
Income from continuing operations before income taxes
|
282,989
|
|
|
246,370
|
|
|
610,825
|
|
|||
Provision for income taxes
|
21,649
|
|
|
131,819
|
|
|
189,778
|
|
|||
(Loss) income from discontinued operations, net of tax
|
—
|
|
|
(2,701
|
)
|
|
5,271
|
|
|||
Net income
|
$
|
261,340
|
|
|
$
|
111,850
|
|
|
$
|
426,318
|
|
|
Depreciation and amortization
|
||||||||||
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
North America Mailing
|
$
|
64,803
|
|
|
$
|
60,066
|
|
|
$
|
58,141
|
|
International Mailing
|
18,562
|
|
|
19,431
|
|
|
23,262
|
|
|||
Small & Medium Business Solutions
|
83,365
|
|
|
79,497
|
|
|
81,403
|
|
|||
Production Mail
|
2,686
|
|
|
4,421
|
|
|
4,075
|
|
|||
Presort Services
|
26,541
|
|
|
27,929
|
|
|
27,305
|
|
|||
Enterprise Business Solutions
|
29,227
|
|
|
32,350
|
|
|
31,380
|
|
|||
Software Solutions
|
8,978
|
|
|
14,621
|
|
|
18,151
|
|
|||
Global Ecommerce
|
36,662
|
|
|
30,607
|
|
|
21,025
|
|
|||
Digital Commerce Solutions
|
45,640
|
|
|
45,228
|
|
|
39,176
|
|
|||
Other
|
—
|
|
|
—
|
|
|
2,057
|
|
|||
Total for reportable segments
|
158,232
|
|
|
157,075
|
|
|
154,016
|
|
|||
Unallocated amount
|
24,104
|
|
|
21,411
|
|
|
19,296
|
|
|||
Total depreciation and amortization
|
$
|
182,336
|
|
|
$
|
178,486
|
|
|
$
|
173,312
|
|
|
Capital expenditures
|
||||||||||
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
North America Mailing
|
$
|
69,131
|
|
|
$
|
83,547
|
|
|
$
|
60,621
|
|
International Mailing
|
11,982
|
|
|
3,163
|
|
|
11,196
|
|
|||
Small & Medium Business Solutions
|
81,113
|
|
|
86,710
|
|
|
71,817
|
|
|||
Production Mail
|
2,893
|
|
|
1,599
|
|
|
3,418
|
|
|||
Presort Services
|
20,860
|
|
|
17,537
|
|
|
17,096
|
|
|||
Enterprise Business Solutions
|
23,753
|
|
|
19,136
|
|
|
20,514
|
|
|||
Software Solutions
|
9,181
|
|
|
4,617
|
|
|
1,688
|
|
|||
Global Ecommerce
|
26,810
|
|
|
15,647
|
|
|
17,321
|
|
|||
Digital Commerce Solutions
|
35,991
|
|
|
20,264
|
|
|
19,009
|
|
|||
Other
|
—
|
|
|
—
|
|
|
857
|
|
|||
Total for reportable segments
|
140,857
|
|
|
126,110
|
|
|
112,197
|
|
|||
Unallocated amount
|
30,133
|
|
|
34,721
|
|
|
54,549
|
|
|||
Total capital expenditures
|
$
|
170,990
|
|
|
$
|
160,831
|
|
|
$
|
166,746
|
|
|
Assets
|
||||||||||
|
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
North America Mailing
|
$
|
1,959,206
|
|
|
$
|
2,066,480
|
|
|
$
|
2,562,816
|
|
International Mailing
|
552,570
|
|
|
532,647
|
|
|
594,564
|
|
|||
Small & Medium Business Solutions
|
2,511,776
|
|
|
2,599,127
|
|
|
3,157,380
|
|
|||
Production Mail
|
260,977
|
|
|
239,358
|
|
|
244,156
|
|
|||
Presort Services
|
387,701
|
|
|
373,443
|
|
|
374,647
|
|
|||
Enterprise Business Solutions
|
648,678
|
|
|
612,801
|
|
|
618,803
|
|
|||
Software Solutions
|
658,737
|
|
|
645,349
|
|
|
858,308
|
|
|||
Global Ecommerce
|
1,016,045
|
|
|
449,363
|
|
|
438,917
|
|
|||
Digital Commerce Solutions
|
1,674,782
|
|
|
1,094,712
|
|
|
1,297,225
|
|
|||
Total for reportable segments
|
4,835,236
|
|
|
4,306,640
|
|
|
5,073,408
|
|
|||
Reconciliation to consolidated amount:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
1,009,021
|
|
|
764,522
|
|
|
640,190
|
|
|||
Short-term investments
|
48,988
|
|
|
38,448
|
|
|
127,388
|
|
|||
Other corporate assets
|
785,470
|
|
|
727,523
|
|
|
282,146
|
|
|||
Total assets
|
$
|
6,678,715
|
|
|
$
|
5,837,133
|
|
|
$
|
6,123,132
|
|
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Numerator:
|
|
|
|
|
|
|
|
|
|||
Net income from continuing operations
|
$
|
261,340
|
|
|
$
|
95,506
|
|
|
$
|
402,672
|
|
(Loss) income from discontinued operations
|
—
|
|
|
(2,701
|
)
|
|
5,271
|
|
|||
Net income (numerator for diluted EPS)
|
261,340
|
|
|
92,805
|
|
|
407,943
|
|
|||
Less: Preference stock dividend
|
36
|
|
|
38
|
|
|
41
|
|
|||
Income attributable to common stockholders (numerator for basic EPS)
|
$
|
261,304
|
|
|
$
|
92,767
|
|
|
$
|
407,902
|
|
Denominator (in thousands):
|
|
|
|
|
|
|
|
|
|||
Weighted-average shares used in basic EPS
|
186,332
|
|
|
187,945
|
|
|
199,835
|
|
|||
Effect of dilutive shares
|
1,103
|
|
|
1,030
|
|
|
1,110
|
|
|||
Weighted-average shares used in diluted EPS
|
187,435
|
|
|
188,975
|
|
|
200,945
|
|
|||
Basic earnings per share:
|
|
|
|
|
|
|
|
|
|||
Continuing operations
|
$
|
1.40
|
|
|
$
|
0.51
|
|
|
$
|
2.01
|
|
Discontinued operations
|
—
|
|
|
(0.01
|
)
|
|
0.03
|
|
|||
Net income attributable to Pitney Bowes Inc.
|
$
|
1.40
|
|
|
$
|
0.49
|
|
|
$
|
2.04
|
|
Diluted earnings per share:
|
|
|
|
|
|
|
|
|
|||
Continuing operations
|
$
|
1.39
|
|
|
$
|
0.51
|
|
|
$
|
2.00
|
|
Discontinued operations
|
—
|
|
|
(0.01
|
)
|
|
0.03
|
|
|||
Net income attributable to Pitney Bowes Inc.
|
$
|
1.39
|
|
|
$
|
0.49
|
|
|
$
|
2.03
|
|
|
|
|
|
|
|
||||||
Anti-dilutive options excluded from diluted earnings per share (in thousands):
|
10,267
|
|
|
8,126
|
|
|
8,079
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Raw materials
|
$
|
30,166
|
|
|
$
|
28,541
|
|
Work in process
|
4,981
|
|
|
6,498
|
|
||
Supplies and service parts
|
45,366
|
|
|
45,152
|
|
||
Finished products
|
21,765
|
|
|
24,678
|
|
||
Inventory at FIFO cost, net
|
102,278
|
|
|
104,869
|
|
||
Excess of FIFO cost over LIFO cost
|
(12,599
|
)
|
|
(12,143
|
)
|
||
Total inventory, net
|
$
|
89,679
|
|
|
$
|
92,726
|
|
|
December 31, 2017
|
|
December 31, 2016
|
||||||||||||||||||||
|
North America
|
|
International
|
|
Total
|
|
North America
|
|
International
|
|
Total
|
||||||||||||
Sales-type lease receivables
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Gross finance receivables
|
$
|
1,023,549
|
|
|
$
|
292,059
|
|
|
$
|
1,315,608
|
|
|
$
|
1,088,053
|
|
|
$
|
273,262
|
|
|
$
|
1,361,315
|
|
Unguaranteed residual values
|
74,093
|
|
|
14,202
|
|
|
88,295
|
|
|
90,190
|
|
|
13,655
|
|
|
103,845
|
|
||||||
Unearned income
|
(216,720
|
)
|
|
(62,325
|
)
|
|
(279,045
|
)
|
|
(223,908
|
)
|
|
(60,458
|
)
|
|
(284,366
|
)
|
||||||
Allowance for credit losses
|
(7,721
|
)
|
|
(2,794
|
)
|
|
(10,515
|
)
|
|
(8,247
|
)
|
|
(2,647
|
)
|
|
(10,894
|
)
|
||||||
Net investment in sales-type lease receivables
|
873,201
|
|
|
241,142
|
|
|
1,114,343
|
|
|
946,088
|
|
|
223,812
|
|
|
1,169,900
|
|
||||||
Loan receivables
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Loan receivables
|
339,373
|
|
|
34,492
|
|
|
373,865
|
|
|
374,147
|
|
|
32,716
|
|
|
406,863
|
|
||||||
Allowance for credit losses
|
(7,098
|
)
|
|
(1,020
|
)
|
|
(8,118
|
)
|
|
(8,517
|
)
|
|
(1,089
|
)
|
|
(9,606
|
)
|
||||||
Net investment in loan receivables
|
332,275
|
|
|
33,472
|
|
|
365,747
|
|
|
365,630
|
|
|
31,627
|
|
|
397,257
|
|
||||||
Net investment in finance receivables
|
$
|
1,205,476
|
|
|
$
|
274,614
|
|
|
$
|
1,480,090
|
|
|
$
|
1,311,718
|
|
|
$
|
255,439
|
|
|
$
|
1,567,157
|
|
|
Sales-type Lease Receivables
|
|
Loan Receivables
|
|
|
||||||||||||||
|
North
America
|
|
International
|
|
North
America
|
|
International
|
|
Total
|
||||||||||
Balance at December 31, 2014
|
$
|
10,125
|
|
|
$
|
5,023
|
|
|
$
|
11,068
|
|
|
$
|
1,788
|
|
|
$
|
28,004
|
|
Amounts charged to expense
|
1,189
|
|
|
890
|
|
|
8,286
|
|
|
1,023
|
|
|
11,388
|
|
|||||
Accounts written off
|
(4,708
|
)
|
|
(2,371
|
)
|
|
(9,330
|
)
|
|
(1,293
|
)
|
|
(17,702
|
)
|
|||||
Balance at December 31, 2015
|
6,606
|
|
|
3,542
|
|
|
10,024
|
|
|
1,518
|
|
|
21,690
|
|
|||||
Amounts charged to expense
|
5,136
|
|
|
1,161
|
|
|
6,238
|
|
|
836
|
|
|
13,371
|
|
|||||
Accounts written off
|
(3,495
|
)
|
|
(2,056
|
)
|
|
(7,745
|
)
|
|
(1,265
|
)
|
|
(14,561
|
)
|
|||||
Balance at December 31, 2016
|
8,247
|
|
|
2,647
|
|
|
8,517
|
|
|
1,089
|
|
|
20,500
|
|
|||||
Amounts charged to expense
|
7,544
|
|
|
1,280
|
|
|
6,273
|
|
|
510
|
|
|
15,607
|
|
|||||
Accounts written off
|
(8,070
|
)
|
|
(1,133
|
)
|
|
(7,692
|
)
|
|
(579
|
)
|
|
(17,474
|
)
|
|||||
Balance at December 31, 2017
|
$
|
7,721
|
|
|
$
|
2,794
|
|
|
$
|
7,098
|
|
|
$
|
1,020
|
|
|
$
|
18,633
|
|
|
Sales-type Lease Receivables
|
|
Loan Receivables
|
|
|
||||||||||||||
|
North
America
|
|
International
|
|
North
America
|
|
International
|
|
Total
|
||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
1 - 90 days
|
$
|
971,002
|
|
|
$
|
286,170
|
|
|
$
|
330,503
|
|
|
$
|
34,239
|
|
|
$
|
1,621,914
|
|
> 90 days
|
52,547
|
|
|
5,889
|
|
|
8,870
|
|
|
253
|
|
|
67,559
|
|
|||||
Total
|
$
|
1,023,549
|
|
|
$
|
292,059
|
|
|
$
|
339,373
|
|
|
$
|
34,492
|
|
|
$
|
1,689,473
|
|
Past due amounts > 90 days
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Still accruing interest
|
$
|
10,807
|
|
|
$
|
1,738
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
12,545
|
|
Not accruing interest
|
41,740
|
|
|
4,151
|
|
|
8,870
|
|
|
253
|
|
|
55,014
|
|
|||||
Total
|
$
|
52,547
|
|
|
$
|
5,889
|
|
|
$
|
8,870
|
|
|
$
|
253
|
|
|
$
|
67,559
|
|
|
Sales-type Lease Receivables
|
|
Loan Receivables
|
|
|
||||||||||||||
|
North
America
|
|
International
|
|
North
America
|
|
International
|
|
Total
|
||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
1 - 90 days
|
$
|
1,025,313
|
|
|
$
|
269,247
|
|
|
$
|
366,726
|
|
|
$
|
32,420
|
|
|
$
|
1,693,706
|
|
> 90 days
|
62,740
|
|
|
4,015
|
|
|
7,421
|
|
|
296
|
|
|
74,472
|
|
|||||
Total
|
$
|
1,088,053
|
|
|
$
|
273,262
|
|
|
$
|
374,147
|
|
|
$
|
32,716
|
|
|
$
|
1,768,178
|
|
Past due amounts > 90 days
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Still accruing interest
|
$
|
8,831
|
|
|
$
|
972
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,803
|
|
Not accruing interest
|
53,909
|
|
|
3,043
|
|
|
7,421
|
|
|
296
|
|
|
64,669
|
|
|||||
Total
|
$
|
62,740
|
|
|
$
|
4,015
|
|
|
$
|
7,421
|
|
|
$
|
296
|
|
|
$
|
74,472
|
|
•
|
Low risk accounts are companies with very good credit scores and are considered to approximate the top
30%
of all commercial borrowers.
|
•
|
Medium risk accounts are companies with average to good credit scores and are considered to approximate the middle
40%
of all commercial borrowers.
|
•
|
High risk accounts are companies with poor credit scores, are delinquent or are at risk of becoming delinquent and are considered to approximate the bottom
30%
of all commercial borrowers.
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Sales-type lease receivables
|
|
|
|
|
|
||
Low
|
$
|
819,776
|
|
|
$
|
879,823
|
|
Medium
|
148,000
|
|
|
135,953
|
|
||
High
|
21,728
|
|
|
22,600
|
|
||
Not Scored
|
34,045
|
|
|
49,677
|
|
||
Total
|
$
|
1,023,549
|
|
|
$
|
1,088,053
|
|
Loan receivables
|
|
|
|
|
|
||
Low
|
$
|
262,646
|
|
|
$
|
296,598
|
|
Medium
|
56,744
|
|
|
53,647
|
|
||
High
|
6,791
|
|
|
7,216
|
|
||
Not Scored
|
13,192
|
|
|
16,686
|
|
||
Total
|
$
|
339,373
|
|
|
$
|
374,147
|
|
|
|
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Land
|
$
|
9,333
|
|
|
$
|
9,908
|
|
Buildings
|
207,024
|
|
|
185,431
|
|
||
Capitalized software
|
224,753
|
|
|
192,395
|
|
||
Machinery and equipment
|
703,924
|
|
|
610,597
|
|
||
|
1,145,034
|
|
|
998,331
|
|
||
Accumulated depreciation
|
(765,990
|
)
|
|
(683,728
|
)
|
||
Property, plant and equipment, net
|
$
|
379,044
|
|
|
$
|
314,603
|
|
|
|
|
|
||||
Rental property and equipment
|
$
|
394,627
|
|
|
$
|
400,913
|
|
Accumulated depreciation
|
(208,886
|
)
|
|
(212,859
|
)
|
||
Rental property and equipment, net
|
$
|
185,741
|
|
|
$
|
188,054
|
|
Accounts receivable
|
$
|
36,195
|
|
Other current assets
|
16,051
|
|
|
Fixed assets
|
26,933
|
|
|
Goodwill
|
330,272
|
|
|
Intangible assets
|
135,640
|
|
|
Accounts payable and other current liabilities
|
(21,500
|
)
|
|
Deferred taxes, net
|
(52,363
|
)
|
|
Other assets and liabilities, net
|
(688
|
)
|
|
|
$
|
470,540
|
|
|
Value
|
|
Amortization period
|
|||
Customer relationships
|
$
|
111,600
|
|
—
|
|
10 years
|
Developed technology
|
19,000
|
|
—
|
|
5 years
|
|
Tradenames
|
4,300
|
|
—
|
|
3 years
|
|
Other
|
740
|
|
|
1-3 years
|
||
Total intangible assets, net
|
$
|
135,640
|
|
|
|
|
December 31, 2017
|
|
December 31, 2016
|
||||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
Customer relationships
|
$
|
526,149
|
|
|
$
|
(292,500
|
)
|
|
$
|
233,649
|
|
|
$
|
445,039
|
|
|
$
|
(300,906
|
)
|
|
$
|
144,133
|
|
Software & technology
|
173,141
|
|
|
(144,742
|
)
|
|
28,399
|
|
|
150,037
|
|
|
(136,508
|
)
|
|
13,529
|
|
||||||
Trademarks & other
|
42,505
|
|
|
(32,367
|
)
|
|
10,138
|
|
|
36,212
|
|
|
(28,702
|
)
|
|
7,510
|
|
||||||
Total intangible assets, net
|
$
|
741,795
|
|
|
$
|
(469,609
|
)
|
|
$
|
272,186
|
|
|
$
|
631,288
|
|
|
$
|
(466,116
|
)
|
|
$
|
165,172
|
|
|
Gross value before accumulated impairment
|
|
Accumulated impairment
|
|
December 31, 2016
|
|
Acquisition
|
|
Impairment
|
|
Other
(1)
|
|
December 31, 2017
|
||||||||||||||
North America Mailing
|
$
|
354,000
|
|
|
$
|
—
|
|
|
$
|
354,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,905
|
|
|
$
|
368,905
|
|
International Mailing
|
145,566
|
|
|
—
|
|
|
145,566
|
|
|
—
|
|
|
—
|
|
|
12,637
|
|
|
158,203
|
|
|||||||
Small & Medium Business Solutions
|
499,566
|
|
|
—
|
|
|
499,566
|
|
|
—
|
|
|
—
|
|
|
27,542
|
|
|
527,108
|
|
|||||||
Production Mail
|
101,099
|
|
|
—
|
|
|
101,099
|
|
|
—
|
|
|
—
|
|
|
6,390
|
|
|
107,489
|
|
|||||||
Presort Services
|
196,890
|
|
|
—
|
|
|
196,890
|
|
|
7,891
|
|
|
—
|
|
|
—
|
|
|
204,781
|
|
|||||||
Enterprise Business Solutions
|
297,989
|
|
|
—
|
|
|
297,989
|
|
|
7,891
|
|
|
—
|
|
|
6,390
|
|
|
312,270
|
|
|||||||
Software Solutions
|
672,683
|
|
|
(171,092
|
)
|
|
501,591
|
|
|
—
|
|
|
—
|
|
|
9,014
|
|
|
510,605
|
|
|||||||
Global Ecommerce
|
272,189
|
|
|
—
|
|
|
272,189
|
|
|
330,272
|
|
|
—
|
|
|
—
|
|
|
602,461
|
|
|||||||
Digital Commerce Solutions
|
944,872
|
|
|
(171,092
|
)
|
|
773,780
|
|
|
330,272
|
|
|
—
|
|
|
9,014
|
|
|
1,113,066
|
|
|||||||
Total goodwill
|
$
|
1,742,427
|
|
|
$
|
(171,092
|
)
|
|
$
|
1,571,335
|
|
|
$
|
338,163
|
|
|
$
|
—
|
|
|
$
|
42,946
|
|
|
$
|
1,952,444
|
|
|
Gross value before accumulated impairment
|
|
Accumulated impairment
|
|
December 31, 2015
|
|
Acquisition
|
|
Impairment
|
|
Other
(1)
|
|
December 31, 2016
|
||||||||||||||
North America Mailing
|
$
|
357,215
|
|
|
$
|
—
|
|
|
$
|
357,215
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3,215
|
)
|
|
$
|
354,000
|
|
International Mailing
|
148,351
|
|
|
—
|
|
|
148,351
|
|
|
—
|
|
|
—
|
|
|
(2,785
|
)
|
|
145,566
|
|
|||||||
Small & Medium Business Solutions
|
505,566
|
|
|
—
|
|
|
505,566
|
|
|
—
|
|
|
—
|
|
|
(6,000
|
)
|
|
499,566
|
|
|||||||
Production Mail
|
105,757
|
|
|
—
|
|
|
105,757
|
|
|
—
|
|
|
—
|
|
|
(4,658
|
)
|
|
101,099
|
|
|||||||
Presort Services
|
196,890
|
|
|
—
|
|
|
196,890
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
196,890
|
|
|||||||
Enterprise Business Solutions
|
302,647
|
|
|
—
|
|
|
302,647
|
|
|
—
|
|
|
—
|
|
|
(4,658
|
)
|
|
297,989
|
|
|||||||
Software Solutions
|
674,976
|
|
|
—
|
|
|
674,976
|
|
|
11,908
|
|
|
(171,092
|
)
|
|
(14,201
|
)
|
|
501,591
|
|
|||||||
Global Ecommerce
|
262,768
|
|
|
—
|
|
|
262,768
|
|
|
9,421
|
|
|
—
|
|
|
—
|
|
|
272,189
|
|
|||||||
Digital Commerce Solutions
|
937,744
|
|
|
—
|
|
|
937,744
|
|
|
21,329
|
|
|
(171,092
|
)
|
|
(14,201
|
)
|
|
773,780
|
|
|||||||
Total goodwill
|
$
|
1,745,957
|
|
|
$
|
—
|
|
|
$
|
1,745,957
|
|
|
$
|
21,329
|
|
|
$
|
(171,092
|
)
|
|
$
|
(24,859
|
)
|
|
$
|
1,571,335
|
|
(1)
|
Primarily represents foreign currency translation adjustments.
|
Level 1
–
|
Unadjusted quoted prices in active markets for identical assets and liabilities.
|
Level 2
–
|
Quoted prices for identical assets and liabilities in markets that are not active, quoted prices for similar assets and liabilities in active markets or other inputs that are observable or can be corroborated by observable market data.
|
Level 3
–
|
Unobservable inputs that are supported by little or no market activity and may be derived from internally developed methodologies based on management's best estimates.
|
|
December 31, 2017
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Investment securities
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds / commercial paper
|
$
|
143,349
|
|
|
$
|
542,568
|
|
|
$
|
—
|
|
|
$
|
685,917
|
|
Equity securities
|
—
|
|
|
40,717
|
|
|
—
|
|
|
40,717
|
|
||||
Commingled fixed income securities
|
1,569
|
|
|
4,516
|
|
|
—
|
|
|
6,085
|
|
||||
Government and related securities
|
116,041
|
|
|
18,587
|
|
|
—
|
|
|
134,628
|
|
||||
Corporate debt securities
|
—
|
|
|
75,109
|
|
|
—
|
|
|
75,109
|
|
||||
Mortgage-backed / asset-backed securities
|
—
|
|
|
158,202
|
|
|
—
|
|
|
158,202
|
|
||||
Derivatives
|
|
|
|
|
|
|
|
|
|
||||||
Interest rate swap
|
—
|
|
|
1,776
|
|
|
—
|
|
|
1,776
|
|
||||
Foreign exchange contracts
|
—
|
|
|
122
|
|
|
—
|
|
|
122
|
|
||||
Total assets
|
$
|
260,959
|
|
|
$
|
841,597
|
|
|
$
|
—
|
|
|
$
|
1,102,556
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Derivatives
|
|
|
|
|
|
|
|
|
|
|
|
||||
Foreign exchange contracts
|
$
|
—
|
|
|
$
|
(335
|
)
|
|
$
|
—
|
|
|
$
|
(335
|
)
|
Total liabilities
|
$
|
—
|
|
|
$
|
(335
|
)
|
|
$
|
—
|
|
|
$
|
(335
|
)
|
|
December 31, 2016
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Investment securities
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds / commercial paper
|
$
|
114,471
|
|
|
$
|
217,175
|
|
|
$
|
—
|
|
|
$
|
331,646
|
|
Equity securities
|
—
|
|
|
24,571
|
|
|
—
|
|
|
24,571
|
|
||||
Commingled fixed income securities
|
1,536
|
|
|
22,132
|
|
|
—
|
|
|
23,668
|
|
||||
Government and related securities
|
116,822
|
|
|
19,358
|
|
|
—
|
|
|
136,180
|
|
||||
Corporate debt securities
|
—
|
|
|
69,891
|
|
|
—
|
|
|
69,891
|
|
||||
Mortgage-backed / asset-backed securities
|
—
|
|
|
158,996
|
|
|
—
|
|
|
158,996
|
|
||||
Derivatives
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swap
|
—
|
|
|
1,588
|
|
|
—
|
|
|
1,588
|
|
||||
Foreign exchange contracts
|
—
|
|
|
637
|
|
|
—
|
|
|
637
|
|
||||
Total assets
|
$
|
232,829
|
|
|
$
|
514,348
|
|
|
$
|
—
|
|
|
$
|
747,177
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Derivatives
|
|
|
|
|
|
|
|
|
|
|
|
||||
Foreign exchange contracts
|
$
|
—
|
|
|
$
|
(3,717
|
)
|
|
$
|
—
|
|
|
$
|
(3,717
|
)
|
Total liabilities
|
$
|
—
|
|
|
$
|
(3,717
|
)
|
|
$
|
—
|
|
|
$
|
(3,717
|
)
|
•
|
Money Market Funds / Commercial Paper:
Money market funds typically invest in government securities, certificates of deposit, commercial paper and other highly liquid, low risk securities. Money market funds are principally used for overnight deposits and are classified as Level 1 when unadjusted quoted prices in active markets are available and as Level 2 when they are not actively traded on an exchange. Direct investments in commercial paper are not listed on an exchange in an active market and are classified as Level 2.
|
•
|
Equity Securities:
comprised of mutual funds investing in U.S. and foreign stocks. These mutual funds are classified as Level 2.
|
•
|
Commingled Fixed Income Securities:
comprised of mutual funds that invest in a variety of fixed income securities including securities of the U.S. government and its agencies, corporate debt, mortgage-backed securities and asset-backed securities. Fair value is based on the value of the underlying investments owned by each fund, minus its liabilities, divided by the number of shares outstanding, as reported by the fund manager. These mutual funds are classified as Level 2.
|
•
|
Government and related securities:
Debt securities are classified as Level 1 where active, high volume trades for identical securities exist. Valuation adjustments are not applied to these securities. Debt securities valued using quoted market prices for similar securities or benchmarking model derived prices to quoted market prices and trade data for identical or comparable securities are classified as Level 2.
|
•
|
Corporate Debt Securities:
Corporate debt securities are valued using recently executed transactions, market price quotations where observable, or bond spreads. The spread data used are for the same maturity as the security. These securities are classified as Level 2.
|
•
|
Mortgage-Backed Securities / Asset-Backed Securities:
These securities are valued based on external pricing indices. When external index pricing is not observable, these securities are valued based on external price/spread data. These securities are classified as Level 2.
|
|
December 31, 2017
|
||||||||||||||
|
Amortized cost
|
|
Gross unrealized gains
|
|
Gross unrealized losses
|
|
Estimated fair value
|
||||||||
Government and related securities
|
$
|
131,872
|
|
|
$
|
1,984
|
|
|
$
|
(1,090
|
)
|
|
$
|
132,766
|
|
Corporate debt securities
|
73,612
|
|
|
1,724
|
|
|
(227
|
)
|
|
75,109
|
|
||||
Commingled fixed income securities
|
1,796
|
|
|
—
|
|
|
(40
|
)
|
|
1,756
|
|
||||
Mortgage-backed / asset-backed securities
|
158,496
|
|
|
1,348
|
|
|
(1,642
|
)
|
|
158,202
|
|
||||
Total
|
$
|
365,776
|
|
|
$
|
5,056
|
|
|
$
|
(2,999
|
)
|
|
$
|
367,833
|
|
|
December 31, 2016
|
||||||||||||||
|
Amortized cost
|
|
Gross unrealized gains
|
|
Gross unrealized losses
|
|
Estimated fair value
|
||||||||
Government and related securities
|
$
|
136,316
|
|
|
$
|
1,571
|
|
|
$
|
(1,707
|
)
|
|
$
|
136,180
|
|
Corporate debt securities
|
69,376
|
|
|
1,180
|
|
|
(665
|
)
|
|
69,891
|
|
||||
Commingled fixed income securities
|
1,568
|
|
|
—
|
|
|
(32
|
)
|
|
1,536
|
|
||||
Mortgage-backed / asset-backed securities
|
159,312
|
|
|
1,566
|
|
|
(1,882
|
)
|
|
158,996
|
|
||||
Total
|
$
|
366,572
|
|
|
$
|
4,317
|
|
|
$
|
(4,286
|
)
|
|
$
|
366,603
|
|
|
Amortized cost
|
|
Estimated fair value
|
||||
Within 1 year
|
$
|
38,624
|
|
|
$
|
38,414
|
|
After 1 year through 5 years
|
111,756
|
|
|
111,704
|
|
||
After 5 years through 10 years
|
68,599
|
|
|
69,154
|
|
||
After 10 years
|
146,797
|
|
|
148,561
|
|
||
Total
|
$
|
365,776
|
|
|
$
|
367,833
|
|
|
|
|
|
December 31,
|
||||||
Designation of Derivatives
|
|
Balance Sheet Location
|
|
2017
|
|
2016
|
||||
Derivatives designated as hedging instruments
|
|
|
|
|
|
|
|
|
||
Foreign exchange contracts
|
|
Other current assets and prepayments
|
|
$
|
57
|
|
|
$
|
487
|
|
|
|
Accounts payable and accrued liabilities
|
|
(144
|
)
|
|
(136
|
)
|
||
|
|
|
|
|
|
|
||||
Interest rate swap
|
|
Other non-current assets
|
|
1,776
|
|
|
1,588
|
|
||
|
|
|
|
|
|
|
||||
Derivatives not designated as hedging instruments
|
|
|
|
|
|
|
|
|
||
Foreign exchange contracts
|
|
Other current assets and prepayments
|
|
65
|
|
|
150
|
|
||
|
|
Accounts payable and accrued liabilities
|
|
(191
|
)
|
|
(3,581
|
)
|
||
|
|
|
|
|
|
|
||||
|
|
Total derivative assets
|
|
1,898
|
|
|
2,225
|
|
||
|
|
Total derivative liabilities
|
|
(335
|
)
|
|
(3,717
|
)
|
||
|
|
Total net derivative liability
|
|
$
|
1,563
|
|
|
$
|
(1,492
|
)
|
|
|
Years Ended December 31,
|
||||||||||||||||
|
|
Derivative Gain (Loss)
Recognized in AOCI
(Effective Portion)
|
|
Location of Gain (Loss)
(Effective Portion)
|
|
Gain (Loss) Reclassified
from AOCI to Earnings
(Effective Portion)
|
||||||||||||
Derivative Instrument
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|||||||||
Foreign exchange contracts
|
|
$
|
(650
|
)
|
|
$
|
496
|
|
|
Revenue
|
|
$
|
(179
|
)
|
|
$
|
(68
|
)
|
|
|
|
|
|
|
|
|
Cost of sales
|
|
(32
|
)
|
|
222
|
|
||||
Interest rate swap
|
|
$
|
1,776
|
|
|
$
|
1,588
|
|
|
Interest Expense
|
|
—
|
|
|
—
|
|
||
|
|
|
|
|
|
|
|
|
|
$
|
(211
|
)
|
|
$
|
154
|
|
|
|
|
|
Years Ended December 31,
|
||||||
|
|
|
|
Derivative Gain (Loss)
Recognized in Earnings
|
||||||
Derivatives Instrument
|
|
Location of Derivative Gain (Loss)
|
|
2017
|
|
2016
|
||||
Foreign exchange contracts
|
|
Selling, general and administrative expense
|
|
$
|
(2,203
|
)
|
|
$
|
(2,382
|
)
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Other assets:
|
|
|
|
||||
Long-term investments
|
$
|
435,612
|
|
|
$
|
425,732
|
|
Other
|
105,184
|
|
|
99,041
|
|
||
Total
|
$
|
540,796
|
|
|
$
|
524,773
|
|
|
|
|
|
||||
Accounts payable and accrued liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
302,101
|
|
|
$
|
293,538
|
|
Customer deposits
|
693,004
|
|
|
688,772
|
|
||
Employee related liabilities
|
260,116
|
|
|
205,901
|
|
||
Other
|
231,520
|
|
|
190,611
|
|
||
Total
|
$
|
1,486,741
|
|
|
$
|
1,378,822
|
|
|
Severance and benefits costs
|
|
Other exit
costs
|
|
Total
|
||||||
Balance at December 31, 2015
|
$
|
43,700
|
|
|
$
|
3,722
|
|
|
$
|
47,422
|
|
Expenses, net
|
44,510
|
|
|
1,655
|
|
|
46,165
|
|
|||
Cash payments
|
(59,834
|
)
|
|
(5,096
|
)
|
|
(64,930
|
)
|
|||
Balance at December 31, 2016
|
28,376
|
|
|
281
|
|
|
28,657
|
|
|||
Expenses, net
|
53,322
|
|
|
2,545
|
|
|
55,867
|
|
|||
Cash payments
|
(39,547
|
)
|
|
(1,257
|
)
|
|
(40,804
|
)
|
|||
Balance at December 31, 2017
|
$
|
42,151
|
|
|
$
|
1,569
|
|
|
$
|
43,720
|
|
|
|
|
December 31,
|
||||||
|
Interest rate
|
|
2017
|
|
2016
|
||||
Notes due September 2017
|
5.75%
|
|
$
|
—
|
|
|
$
|
385,109
|
|
Notes due March 2018
|
5.60%
|
|
250,000
|
|
|
250,000
|
|
||
Notes due May 2018
|
4.75%
|
|
—
|
|
|
350,000
|
|
||
Notes due March 2019
|
6.25%
|
|
300,000
|
|
|
300,000
|
|
||
Notes due September 2020
|
3.625%
|
|
300,000
|
|
|
—
|
|
||
Notes due October 2021
|
3.625%
|
|
600,000
|
|
|
600,000
|
|
||
Notes due May 2022
|
4.125%
|
|
400,000
|
|
|
—
|
|
||
Notes due April 2023
|
4.70%
|
|
400,000
|
|
|
—
|
|
||
Notes due March 2024
|
4.625%
|
|
500,000
|
|
|
500,000
|
|
||
Notes due January 2037
|
5.25%
|
|
35,841
|
|
|
115,041
|
|
||
Notes due March 2043
|
6.70%
|
|
425,000
|
|
|
425,000
|
|
||
Term loans
|
Variable
|
|
650,000
|
|
|
450,000
|
|
||
Other debt
|
|
|
5,476
|
|
|
5,677
|
|
||
Principal amount
|
|
|
3,866,317
|
|
|
3,380,827
|
|
||
Less: unamortized costs, net
|
|
|
35,982
|
|
|
15,937
|
|
||
Total debt
|
|
|
3,830,335
|
|
|
3,364,890
|
|
||
Less: current portion long-term debt
|
|
|
271,057
|
|
|
614,485
|
|
||
Long-term debt
|
|
|
$
|
3,559,278
|
|
|
$
|
2,750,405
|
|
2018
|
$
|
270,000
|
|
2019
|
500,000
|
|
|
2020
|
730,476
|
|
|
2021
|
600,000
|
|
|
2022
|
400,000
|
|
|
Thereafter
|
1,365,841
|
|
|
Total
|
$
|
3,866,317
|
|
|
United States
|
|
Foreign
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Accumulated benefit obligation
|
$
|
1,726,824
|
|
|
$
|
1,677,288
|
|
|
$
|
737,580
|
|
|
$
|
675,566
|
|
|
|
|
|
|
|
|
|
||||||||
Projected benefit obligation
|
|
|
|
|
|
|
|
||||||||
Benefit obligation - beginning of year
|
$
|
1,678,097
|
|
|
$
|
1,689,885
|
|
|
$
|
688,172
|
|
|
$
|
647,112
|
|
Service cost
|
132
|
|
|
105
|
|
|
2,274
|
|
|
2,148
|
|
||||
Interest cost
|
68,611
|
|
|
73,699
|
|
|
18,836
|
|
|
21,886
|
|
||||
Plan participants' contributions
|
—
|
|
|
—
|
|
|
6
|
|
|
6
|
|
||||
Actuarial loss
|
92,789
|
|
|
31,764
|
|
|
2,098
|
|
|
127,054
|
|
||||
Foreign currency changes
|
—
|
|
|
—
|
|
|
64,236
|
|
|
(88,138
|
)
|
||||
Settlement
|
—
|
|
|
(5,887
|
)
|
|
—
|
|
|
(423
|
)
|
||||
Benefits paid
|
(111,892
|
)
|
|
(111,469
|
)
|
|
(24,249
|
)
|
|
(21,473
|
)
|
||||
Benefit obligation - end of year
|
$
|
1,727,737
|
|
|
$
|
1,678,097
|
|
|
$
|
751,373
|
|
|
$
|
688,172
|
|
Fair value of plan assets
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets - beginning of year
|
$
|
1,464,082
|
|
|
$
|
1,460,790
|
|
|
$
|
547,290
|
|
|
$
|
530,112
|
|
Actual return on plan assets
|
199,749
|
|
|
110,954
|
|
|
46,542
|
|
|
68,067
|
|
||||
Company contributions
|
5,968
|
|
|
9,694
|
|
|
13,081
|
|
|
40,872
|
|
||||
Plan participants' contributions
|
—
|
|
|
—
|
|
|
6
|
|
|
6
|
|
||||
Settlement
|
—
|
|
|
(5,887
|
)
|
|
—
|
|
|
(423
|
)
|
||||
Foreign currency changes
|
—
|
|
|
—
|
|
|
50,040
|
|
|
(69,871
|
)
|
||||
Benefits paid
|
(111,892
|
)
|
|
(111,469
|
)
|
|
(24,249
|
)
|
|
(21,473
|
)
|
||||
Fair value of plan assets - end of year
|
$
|
1,557,907
|
|
|
$
|
1,464,082
|
|
|
$
|
632,710
|
|
|
$
|
547,290
|
|
Amounts recognized in the Consolidated Balance Sheets
|
|
|
|
|
|
|
|
||||||||
Noncurrent asset
|
$
|
392
|
|
|
$
|
310
|
|
|
$
|
19,139
|
|
|
$
|
11,744
|
|
Current liability
|
(8,362
|
)
|
|
(7,937
|
)
|
|
(1,188
|
)
|
|
(1,045
|
)
|
||||
Noncurrent liability
|
(161,860
|
)
|
|
(206,388
|
)
|
|
(136,614
|
)
|
|
(151,581
|
)
|
||||
Funded status
|
$
|
(169,830
|
)
|
|
$
|
(214,015
|
)
|
|
$
|
(118,663
|
)
|
|
$
|
(140,882
|
)
|
|
United States
|
|
Foreign
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Projected benefit obligation
|
$
|
1,727,292
|
|
|
$
|
1,677,675
|
|
|
$
|
614,371
|
|
|
$
|
578,588
|
|
Accumulated benefit obligation
|
$
|
1,726,378
|
|
|
$
|
1,676,866
|
|
|
$
|
601,412
|
|
|
$
|
565,992
|
|
Fair value of plan assets
|
$
|
1,557,069
|
|
|
$
|
1,463,350
|
|
|
$
|
476,825
|
|
|
$
|
425,962
|
|
|
United States
|
|
Foreign
|
||||
Net actuarial loss
|
$
|
32,303
|
|
|
$
|
7,304
|
|
Prior service credit
|
(60
|
)
|
|
(72
|
)
|
||
Transition asset
|
—
|
|
|
(7
|
)
|
||
Total
|
$
|
32,243
|
|
|
$
|
7,225
|
|
|
United States
|
|
Foreign
|
||||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
||||||||||||
Service cost
|
$
|
132
|
|
|
$
|
105
|
|
|
$
|
134
|
|
|
$
|
2,274
|
|
|
$
|
2,148
|
|
|
$
|
2,229
|
|
Interest cost
|
68,611
|
|
|
73,699
|
|
|
74,331
|
|
|
18,836
|
|
|
21,886
|
|
|
24,261
|
|
||||||
Expected return on plan assets
|
(97,656
|
)
|
|
(101,918
|
)
|
|
(104,004
|
)
|
|
(32,242
|
)
|
|
(32,615
|
)
|
|
(35,421
|
)
|
||||||
Amortization of net transition asset
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
(8
|
)
|
|
(9
|
)
|
||||||
Amortization of prior service credit
|
(60
|
)
|
|
(60
|
)
|
|
(60
|
)
|
|
(71
|
)
|
|
(73
|
)
|
|
(66
|
)
|
||||||
Amortization of net actuarial loss
|
28,954
|
|
|
27,220
|
|
|
29,272
|
|
|
8,052
|
|
|
5,264
|
|
|
5,926
|
|
||||||
Special termination benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
52
|
|
|
79
|
|
||||||
Settlement
|
—
|
|
|
2,109
|
|
|
1,243
|
|
|
—
|
|
|
110
|
|
|
—
|
|
||||||
Net periodic benefit (income) cost
|
$
|
(19
|
)
|
|
$
|
1,155
|
|
|
$
|
916
|
|
|
$
|
(3,159
|
)
|
|
$
|
(3,236
|
)
|
|
$
|
(3,001
|
)
|
|
United States
|
|
Foreign
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Net actuarial (gain) loss
|
$
|
(9,304
|
)
|
|
$
|
22,728
|
|
|
$
|
(12,202
|
)
|
|
$
|
91,549
|
|
Amortization of net actuarial loss
|
(28,954
|
)
|
|
(27,220
|
)
|
|
(8,052
|
)
|
|
(5,264
|
)
|
||||
Amortization of prior service credit
|
60
|
|
|
60
|
|
|
71
|
|
|
73
|
|
||||
Net transition asset
|
—
|
|
|
—
|
|
|
8
|
|
|
8
|
|
||||
Settlement
|
—
|
|
|
(2,109
|
)
|
|
—
|
|
|
(110
|
)
|
||||
Total recognized in other comprehensive income
|
$
|
(38,198
|
)
|
|
$
|
(6,541
|
)
|
|
$
|
(20,175
|
)
|
|
$
|
86,256
|
|
|
2017
|
|
2016
|
|
2015
|
|||||||||
United States
|
|
|
|
|
|
|
|
|
|
|
|
|||
Used to determine benefit obligations
|
|
|
|
|
|
|
|
|
|
|
|
|||
Discount rate
|
3.69%
|
|
4.20%
|
|
4.55%
|
|||||||||
Rate of compensation increase
|
N/A
|
|
N/A
|
|
N/A
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Used to determine net periodic benefit cost
|
|
|
|
|
|
|
|
|
|
|
|
|||
Discount rate
|
4.20%
|
|
4.55%
|
|
4.15%
|
|||||||||
Expected return on plan assets
|
6.75%
|
|
7.00%
|
|
7.0%
|
|||||||||
Rate of compensation increase
|
N/A
|
|
N/A
|
|
N/A
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Foreign
|
|
|
|
|
|
|
|
|
|
|
|
|||
Used to determine benefit obligations
|
|
|
|
|
|
|
|
|
|
|
|
|||
Discount rate
|
0.65
|
%
|
-
|
3.35%
|
|
0.70
|
%
|
-
|
3.65%
|
|
1.15
|
%
|
-
|
3.95%
|
Rate of compensation increase
|
1.50
|
%
|
-
|
2.50%
|
|
1.50
|
%
|
-
|
2.50%
|
|
1.50
|
%
|
-
|
3.50%
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Used to determine net periodic benefit cost
|
|
|
|
|
|
|
|
|
|
|
|
|||
Discount rate
|
0.70
|
%
|
-
|
3.65%
|
|
1.15
|
%
|
-
|
3.95%
|
|
1.10
|
%
|
-
|
3.80%
|
Expected return on plan assets
|
3.75
|
%
|
-
|
6.25%
|
|
3.75
|
%
|
-
|
6.51%
|
|
4.00
|
%
|
-
|
7.00%
|
Rate of compensation increase
|
1.50
|
%
|
-
|
3.30%
|
|
1.50
|
%
|
-
|
3.50%
|
|
1.50
|
%
|
-
|
3.50%
|
|
Target allocation
|
|
Percent of Plan Assets at December 31,
|
|||||
|
2018
|
|
2017
|
|
2016
|
|||
Asset category
|
|
|
|
|
|
|||
U.S. equities
|
15
|
%
|
|
15
|
%
|
|
17
|
%
|
Non-U.S. equities
|
15
|
%
|
|
15
|
%
|
|
13
|
%
|
Fixed income
|
60
|
%
|
|
62
|
%
|
|
60
|
%
|
Real estate
|
5
|
%
|
|
6
|
%
|
|
6
|
%
|
Private equity
|
5
|
%
|
|
2
|
%
|
|
4
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
Target Allocation
|
|
Percent of Plan Assets at December 31,
|
|||||
|
2018
|
|
2017
|
|
2016
|
|||
Asset category
|
|
|
|
|
|
|||
U.K. equities
|
10
|
%
|
|
10
|
%
|
|
22
|
%
|
Non-U.K. equities
|
30
|
%
|
|
29
|
%
|
|
19
|
%
|
Fixed income
|
40
|
%
|
|
41
|
%
|
|
41
|
%
|
Real estate
|
10
|
%
|
|
9
|
%
|
|
8
|
%
|
Diversified growth
|
10
|
%
|
|
9
|
%
|
|
9
|
%
|
Cash
|
—
|
%
|
|
2
|
%
|
|
1
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
December 31, 2017
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Money market funds
|
$
|
8,810
|
|
|
$
|
9,350
|
|
|
$
|
—
|
|
|
$
|
18,160
|
|
Equity securities
|
152,815
|
|
|
150,043
|
|
|
—
|
|
|
302,858
|
|
||||
Commingled fixed income securities
|
—
|
|
|
377,078
|
|
|
—
|
|
|
377,078
|
|
||||
Government and related securities
|
295,404
|
|
|
20,473
|
|
|
—
|
|
|
315,877
|
|
||||
Corporate debt securities
|
—
|
|
|
418,908
|
|
|
—
|
|
|
418,908
|
|
||||
Mortgage-backed securities /asset-backed securities
|
—
|
|
|
19,223
|
|
|
—
|
|
|
19,223
|
|
||||
Private equity
|
—
|
|
|
—
|
|
|
38,362
|
|
|
38,362
|
|
||||
Real estate
|
—
|
|
|
—
|
|
|
91,352
|
|
|
91,352
|
|
||||
Securities lending collateral
(1)
|
—
|
|
|
152,179
|
|
|
—
|
|
|
152,179
|
|
||||
Total plan assets at fair value
|
$
|
457,029
|
|
|
$
|
1,147,254
|
|
|
$
|
129,714
|
|
|
$
|
1,733,997
|
|
Securities lending payable
(1)
|
|
|
|
|
|
|
(152,179
|
)
|
|||||||
Cash
|
|
|
|
|
|
|
5,186
|
|
|||||||
Other
|
|
|
|
|
|
|
(29,097
|
)
|
|||||||
Fair value of plan assets
|
|
|
|
|
|
|
|
|
$
|
1,557,907
|
|
|
December 31, 2016
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Money market funds
|
$
|
2,604
|
|
|
$
|
6,609
|
|
|
$
|
—
|
|
|
$
|
9,213
|
|
Equity securities
|
184,254
|
|
|
140,691
|
|
|
—
|
|
|
324,945
|
|
||||
Commingled fixed income securities
|
—
|
|
|
358,776
|
|
|
—
|
|
|
358,776
|
|
||||
Government and related securities
|
214,068
|
|
|
21,126
|
|
|
—
|
|
|
235,194
|
|
||||
Corporate debt securities
|
—
|
|
|
367,369
|
|
|
—
|
|
|
367,369
|
|
||||
Mortgage-backed securities /asset-backed securities
|
—
|
|
|
14,072
|
|
|
1,236
|
|
|
15,308
|
|
||||
Private equity
|
—
|
|
|
—
|
|
|
49,637
|
|
|
49,637
|
|
||||
Real estate
|
—
|
|
|
—
|
|
|
87,852
|
|
|
87,852
|
|
||||
Securities lending collateral
(1)
|
—
|
|
|
174,651
|
|
|
—
|
|
|
174,651
|
|
||||
Total plan assets at fair value
|
$
|
400,926
|
|
|
$
|
1,083,294
|
|
|
$
|
138,725
|
|
|
$
|
1,622,945
|
|
Securities lending payable
(1)
|
|
|
|
|
|
|
(174,651
|
)
|
|||||||
Cash
|
|
|
|
|
|
|
18,164
|
|
|||||||
Other
|
|
|
|
|
|
|
(2,376
|
)
|
|||||||
Fair value of plan assets
|
|
|
|
|
|
|
|
|
$
|
1,464,082
|
|
|
December 31, 2017
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Money market funds
|
$
|
—
|
|
|
$
|
13,375
|
|
|
$
|
—
|
|
|
$
|
13,375
|
|
Equity securities
|
—
|
|
|
226,032
|
|
|
—
|
|
|
226,032
|
|
||||
Commingled fixed income securities
|
—
|
|
|
213,844
|
|
|
—
|
|
|
213,844
|
|
||||
Government and related securities
|
—
|
|
|
66,115
|
|
|
—
|
|
|
66,115
|
|
||||
Corporate debt securities
|
—
|
|
|
24,889
|
|
|
—
|
|
|
24,889
|
|
||||
Real estate
|
—
|
|
|
—
|
|
|
41,601
|
|
|
41,601
|
|
||||
Diversified growth funds
|
—
|
|
|
—
|
|
|
44,024
|
|
|
44,024
|
|
||||
Total plan assets at fair value
|
$
|
—
|
|
|
$
|
544,255
|
|
|
$
|
85,625
|
|
|
$
|
629,880
|
|
Cash
|
|
|
|
|
|
|
2,203
|
|
|||||||
Other
|
|
|
|
|
|
|
627
|
|
|||||||
Fair value of plan assets
|
|
|
|
|
|
|
|
|
$
|
632,710
|
|
|
December 31, 2016
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Money market funds
|
$
|
—
|
|
|
$
|
6,811
|
|
|
$
|
—
|
|
|
$
|
6,811
|
|
Equity securities
|
32,295
|
|
|
181,943
|
|
|
—
|
|
|
214,238
|
|
||||
Commingled fixed income securities
|
—
|
|
|
69,022
|
|
|
—
|
|
|
69,022
|
|
||||
Government and related securities
|
—
|
|
|
29,363
|
|
|
—
|
|
|
29,363
|
|
||||
Corporate debt securities
|
—
|
|
|
150,767
|
|
|
—
|
|
|
150,767
|
|
||||
Real estate
|
—
|
|
|
—
|
|
|
34,483
|
|
|
34,483
|
|
||||
Diversified growth funds
|
—
|
|
|
—
|
|
|
36,779
|
|
|
36,779
|
|
||||
Total plan assets at fair value
|
$
|
32,295
|
|
|
$
|
437,906
|
|
|
$
|
71,262
|
|
|
$
|
541,463
|
|
Cash
|
|
|
|
|
|
|
4,262
|
|
|||||||
Other
|
|
|
|
|
|
|
1,565
|
|
|||||||
Fair value of plan assets
|
|
|
|
|
|
|
|
|
$
|
547,290
|
|
•
|
Money Market Funds:
Money market funds typically invest in government securities, certificates of deposit, commercial paper of companies and other highly liquid, low risk securities. Money market funds are principally used for overnight deposits.
|
•
|
Equity Securities:
Equity securities include U.S. and foreign stocks, American Depository Receipts, preferred stock and commingled funds. There are no shares of our common stock included in the plan assets of our pension plans.
|
•
|
Commingled Fixed Income Securities:
Mutual funds that invest in fixed income securities of the U.S. government and its agencies, corporate debt, mortgage-backed securities and asset-backed securities. Fair value is based on the market value of the underlying investments owned by each fund, minus its liabilities, divided by the number of shares outstanding as reported by the fund manager.
|
•
|
Government and Related Securities:
Government and related securities include treasury notes and bonds, foreign government issues, U.S. government sponsored agency debt and commingled funds. Municipal debt securities include general obligation securities and revenue-backed securities. Fair value is based on benchmarking model derived prices to quotes market prices and trade data for identical comparable securities.
|
•
|
Corporate Debt Securities
: Investments are comprised of both investment grade debt and high-yield debt. The fair value of corporate debt securities is determined using recently executed transactions, market price quotations where observable, or bond spreads.
|
•
|
Mortgage-Backed Securities (MBS)/Asset-Backed Securities (ABS)
: MBS are investments are comprised of agency-backed MBS, non-agency MBS, collateralized mortgage obligations, commercial MBS, and commingled funds. These securities are valued based on external pricing indices- external price/spread data or broker quotes. ABS are investments are primarily comprised of credit card receivables, auto loan receivables, student loan receivables, and Small Business Administration loans.
|
•
|
Private Equity
: Investments are comprised of units in fund-of-funds investment vehicles. Fund-of-funds consist of various private equity investments and are used in an effort to gain greater diversification. The investments are valued in accordance with the most appropriate valuation techniques.
|
•
|
Real Estate:
Investments include units in open-ended commingled real estate funds. Properties that comprise these funds are valued in accordance with the most appropriate valuation techniques.
|
•
|
Diversified Growth Funds:
Investments are comprised of units in commingled diversified growth funds. These investments are valued based on the net asset value (NAV) per unit as reported by the fund manager.
|
•
|
Securities Lending Fund:
Investment represents a commingled fund through our custodian's securities lending program. The U.S. pension plan lends securities that are held within the plan to other banks and/or brokers, and receives collateral, typically cash. This collateral is invested in a short-term fixed income securities commingled fund. This amount invested in the fund is offset by a corresponding liability reflected in the U.S. pension plan's net assets available for benefits.
|
|
MBS & ABS
|
|
Private equity
|
|
Real estate
|
|
Total
|
||||||||
Balance at December 31, 2015
|
$
|
1,592
|
|
|
$
|
63,577
|
|
|
$
|
82,569
|
|
|
$
|
147,738
|
|
Realized gains
|
8
|
|
|
10,200
|
|
|
1,280
|
|
|
11,488
|
|
||||
Unrealized gains (losses)
|
38
|
|
|
(7,540
|
)
|
|
4,815
|
|
|
(2,687
|
)
|
||||
Net purchases, sales and settlements
|
(402
|
)
|
|
(16,600
|
)
|
|
(812
|
)
|
|
(17,814
|
)
|
||||
Balance at December 31, 2016
|
1,236
|
|
|
49,637
|
|
|
87,852
|
|
|
138,725
|
|
||||
Realized gains
|
25
|
|
|
9,226
|
|
|
980
|
|
|
10,231
|
|
||||
Unrealized gains (losses)
|
49
|
|
|
(2,334
|
)
|
|
2,397
|
|
|
112
|
|
||||
Net purchases, sales and settlements
|
(1,310
|
)
|
|
(18,167
|
)
|
|
123
|
|
|
(19,354
|
)
|
||||
Balance at December 31, 2017
|
$
|
—
|
|
|
$
|
38,362
|
|
|
$
|
91,352
|
|
|
$
|
129,714
|
|
|
Real estate
|
|
Diversified growth funds
|
|
Total
|
||||||
Balance at December 31, 2015
|
$
|
39,177
|
|
|
$
|
20,513
|
|
|
$
|
59,690
|
|
Unrealized gains
|
459
|
|
|
2,561
|
|
|
3,020
|
|
|||
Net purchases, sales and settlements
|
1,436
|
|
|
19,028
|
|
|
20,464
|
|
|||
Foreign currency loss
|
(6,589
|
)
|
|
(5,323
|
)
|
|
(11,912
|
)
|
|||
Balance at December 31, 2016
|
34,483
|
|
|
36,779
|
|
|
71,262
|
|
|||
Unrealized gains
|
2,159
|
|
|
3,551
|
|
|
5,710
|
|
|||
Net purchases, sales and settlements
|
1,481
|
|
|
—
|
|
|
1,481
|
|
|||
Foreign currency gain
|
3,478
|
|
|
3,694
|
|
|
7,172
|
|
|||
Balance at December 31, 2017
|
$
|
41,601
|
|
|
$
|
44,024
|
|
|
$
|
85,625
|
|
|
2017
|
|
2016
|
||||
Benefit obligation
|
|
|
|
||||
Benefit obligation - beginning of year
|
$
|
189,772
|
|
|
$
|
211,878
|
|
Service cost
|
1,727
|
|
|
2,046
|
|
||
Interest cost
|
7,100
|
|
|
7,969
|
|
||
Plan participants' contributions
|
3,820
|
|
|
4,241
|
|
||
Actuarial loss (gain)
|
5,134
|
|
|
(13,934
|
)
|
||
Foreign currency changes
|
1,066
|
|
|
409
|
|
||
Benefits paid
|
(19,778
|
)
|
|
(22,837
|
)
|
||
Benefit obligation - end of year
(1)
|
$
|
188,841
|
|
|
$
|
189,772
|
|
Fair value of plan assets
|
|
|
|
||||
Fair value of plan assets - beginning of year
|
$
|
—
|
|
|
$
|
—
|
|
Company contribution
|
15,958
|
|
|
18,596
|
|
||
Plan participants' contributions
|
3,820
|
|
|
4,241
|
|
||
Benefits paid
|
(19,778
|
)
|
|
(22,837
|
)
|
||
Fair value of plan assets - end of year
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
The benefit obligation for the U.S. nonpension postretirement plans was
$172 million
and
$174 million
at
December 31, 2017
and
2016
, respectively.
|
|
2017
|
|
2016
|
||||
Net actuarial loss
|
$
|
43,160
|
|
|
$
|
41,625
|
|
Prior service cost
|
1,466
|
|
|
1,763
|
|
||
Total
|
$
|
44,626
|
|
|
$
|
43,388
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
Service cost
|
$
|
1,727
|
|
|
$
|
2,046
|
|
|
$
|
2,455
|
|
Interest cost
|
7,100
|
|
|
7,969
|
|
|
8,799
|
|
|||
Amortization of prior service cost
|
297
|
|
|
297
|
|
|
297
|
|
|||
Amortization of net actuarial loss
|
3,600
|
|
|
3,615
|
|
|
7,528
|
|
|||
Net periodic benefit cost
|
$
|
12,724
|
|
|
$
|
13,927
|
|
|
$
|
19,079
|
|
|
2017
|
|
2016
|
||||
Net actuarial loss (gain)
|
$
|
5,134
|
|
|
$
|
(13,934
|
)
|
Amortization of net actuarial loss
|
(3,600
|
)
|
|
(3,615
|
)
|
||
Amortization of prior service cost
|
(297
|
)
|
|
(297
|
)
|
||
Total recognized in other comprehensive income
|
$
|
1,237
|
|
|
$
|
(17,846
|
)
|
Net actuarial loss
|
$
|
3,736
|
|
Prior service cost
|
351
|
|
|
Total
|
$
|
4,087
|
|
|
2017
|
|
2016
|
|
2015
|
|||
Discount rate used to determine benefit obligation
|
|
|
|
|
|
|||
U.S.
|
3.55
|
%
|
|
3.90
|
%
|
|
4.20
|
%
|
Canada
|
3.35
|
%
|
|
3.65
|
%
|
|
3.95
|
%
|
|
|
|
|
|
|
|||
Discount rate used to determine net period benefit cost
|
|
|
|
|
|
|||
U.S.
|
3.90
|
%
|
|
4.20
|
%
|
|
3.90
|
%
|
Canada
|
3.65
|
%
|
|
3.95
|
%
|
|
3.80
|
%
|
|
1% Increase
|
|
1% Decrease
|
||||
Effect on total of service and interest cost components
|
$
|
323
|
|
|
$
|
(269
|
)
|
Effect on postretirement benefit obligation
|
$
|
7,672
|
|
|
$
|
(6,479
|
)
|
|
Pension Benefits
|
|
Nonpension Benefits
|
||||
Years ending December 31,
|
|
|
|
||||
2018
|
$
|
132,626
|
|
|
$
|
17,693
|
|
2019
|
129,051
|
|
|
17,163
|
|
||
2020
|
130,201
|
|
|
16,554
|
|
||
2021
|
128,257
|
|
|
15,952
|
|
||
2022
|
128,221
|
|
|
15,347
|
|
||
Thereafter
|
628,715
|
|
|
63,303
|
|
||
|
$
|
1,277,071
|
|
|
$
|
146,012
|
|
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
U.S. Federal:
|
|
|
|
|
|
||||||
Current
|
$
|
46,836
|
|
|
$
|
95,598
|
|
|
$
|
115,557
|
|
Deferred
|
(48,449
|
)
|
|
(1,559
|
)
|
|
19,941
|
|
|||
|
(1,613
|
)
|
|
94,039
|
|
|
135,498
|
|
|||
U.S. State and Local:
|
|
|
|
|
|
||||||
Current
|
461
|
|
|
9,409
|
|
|
11,243
|
|
|||
Deferred
|
15,460
|
|
|
4,757
|
|
|
16,094
|
|
|||
|
15,921
|
|
|
14,166
|
|
|
27,337
|
|
|||
International:
|
|
|
|
|
|
||||||
Current
|
(1,766
|
)
|
|
22,872
|
|
|
22,794
|
|
|||
Deferred
|
9,107
|
|
|
742
|
|
|
4,149
|
|
|||
|
7,341
|
|
|
23,614
|
|
|
26,943
|
|
|||
|
|
|
|
|
|
||||||
Total current
|
45,531
|
|
|
127,879
|
|
|
149,594
|
|
|||
Total deferred
|
(23,882
|
)
|
|
3,940
|
|
|
40,184
|
|
|||
Total provision for income taxes
|
$
|
21,649
|
|
|
$
|
131,819
|
|
|
$
|
189,778
|
|
|
|
|
|
|
|
||||||
Effective tax rate
|
7.7
|
%
|
|
53.5
|
%
|
|
31.1
|
%
|
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Federal statutory provision
|
$
|
99,045
|
|
|
$
|
86,229
|
|
|
$
|
213,789
|
|
State and local income taxes
|
7,327
|
|
|
9,208
|
|
|
17,769
|
|
|||
Other impact of foreign operations
|
(31,573
|
)
|
|
(13,806
|
)
|
|
(6,492
|
)
|
|||
Tax incentives/credits/exempt income
|
(16,292
|
)
|
|
(10,735
|
)
|
|
(12,130
|
)
|
|||
Outside basis differences
|
—
|
|
|
—
|
|
|
(27,110
|
)
|
|||
Goodwill impairments
|
—
|
|
|
58,022
|
|
|
—
|
|
|||
Remeasurement of U.S. deferred tax liability
|
(129,612
|
)
|
|
—
|
|
|
—
|
|
|||
U.S. tax on unremitted earnings
|
90,916
|
|
|
—
|
|
|
—
|
|
|||
Other, net
|
1,838
|
|
|
2,901
|
|
|
3,952
|
|
|||
Provision for income taxes
|
$
|
21,649
|
|
|
$
|
131,819
|
|
|
$
|
189,778
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Depreciation
|
$
|
(77,415
|
)
|
|
$
|
(93,475
|
)
|
Deferred profit (for tax purposes) on sale to finance subsidiary
|
(60,340
|
)
|
|
(98,247
|
)
|
||
Lease revenue and related depreciation
|
(133,908
|
)
|
|
(137,665
|
)
|
||
Intangible assets
|
(106,488
|
)
|
|
(113,128
|
)
|
||
Other
|
(22,468
|
)
|
|
(27,340
|
)
|
||
Gross deferred tax liabilities
|
(400,619
|
)
|
|
(469,855
|
)
|
||
|
|
|
|
||||
Deferred tax assets:
|
|
|
|
||||
Nonpension postretirement benefits
|
48,387
|
|
|
71,101
|
|
||
Pension
|
66,270
|
|
|
105,564
|
|
||
Inventory and equipment capitalization
|
11,380
|
|
|
13,318
|
|
||
Restructuring charges
|
12,476
|
|
|
6,980
|
|
||
Long-term incentives
|
11,544
|
|
|
17,923
|
|
||
Net operating loss
|
108,006
|
|
|
97,194
|
|
||
Tax credit carry forwards
|
82,285
|
|
|
53,181
|
|
||
Tax uncertainties gross-up
|
9,920
|
|
|
18,273
|
|
||
Other
|
51,436
|
|
|
79,799
|
|
||
Gross deferred tax assets
|
401,704
|
|
|
463,333
|
|
||
Less: Valuation allowance
|
(178,156
|
)
|
|
(127,095
|
)
|
||
Net deferred tax assets
|
223,548
|
|
|
336,238
|
|
||
Total deferred taxes, net
|
$
|
(177,071
|
)
|
|
$
|
(133,617
|
)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Balance at beginning of year
|
$
|
124,728
|
|
|
$
|
139,249
|
|
|
$
|
132,495
|
|
Increases from prior period positions
|
528
|
|
|
—
|
|
|
7,637
|
|
|||
Decreases from prior period positions
|
(31,470
|
)
|
|
(21,207
|
)
|
|
(16,753
|
)
|
|||
Increases from current period positions
|
5,951
|
|
|
10,867
|
|
|
23,533
|
|
|||
Decreases relating to settlements with tax authorities
|
(6,953
|
)
|
|
(1,791
|
)
|
|
(3,831
|
)
|
|||
Reductions from lapse of applicable statute of limitations
|
(3,017
|
)
|
|
(2,390
|
)
|
|
(3,832
|
)
|
|||
Balance at end of year
|
$
|
89,767
|
|
|
$
|
124,728
|
|
|
$
|
139,249
|
|
Years ending December 31,
|
|
||
2018
|
$
|
47,820
|
|
2019
|
39,107
|
|
|
2020
|
30,180
|
|
|
2021
|
22,266
|
|
|
2022
|
15,256
|
|
|
Thereafter
|
63,685
|
|
|
Total minimum lease payments
|
$
|
218,314
|
|
|
Common Stock Outstanding
|
|
Treasury Stock
|
||
Balance at December 31, 2014
|
201,027,964
|
|
|
122,309,948
|
|
Repurchases of common stock
|
(6,476,796
|
)
|
|
6,476,796
|
|
Issuance of common stock
|
943,686
|
|
|
(943,686
|
)
|
Conversions to common stock
|
26,354
|
|
|
(26,354
|
)
|
Balance at December 31, 2015
|
195,521,208
|
|
|
127,816,704
|
|
Repurchases of common stock
|
(10,633,235
|
)
|
|
10,633,235
|
|
Issuance of common stock
|
767,060
|
|
|
(767,060
|
)
|
Conversions to common stock
|
13,685
|
|
|
(13,685
|
)
|
Balance at December 31, 2016
|
185,668,718
|
|
|
137,669,194
|
|
Issuance of common stock
|
881,480
|
|
|
(881,480
|
)
|
Conversions to common stock
|
53,540
|
|
|
(53,540
|
)
|
Balance at December 31, 2017
|
186,603,738
|
|
|
136,734,174
|
|
|
Amounts Reclassified from AOCI (a)
|
||||||||||
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Gains (losses) on cash flow hedges
|
|
|
|
|
|
||||||
Revenue
|
$
|
(179
|
)
|
|
$
|
68
|
|
|
$
|
1,082
|
|
Cost of sales
|
(32
|
)
|
|
(222
|
)
|
|
551
|
|
|||
Interest expense
|
(2,028
|
)
|
|
(2,028
|
)
|
|
(2,028
|
)
|
|||
Total before tax
|
(2,239
|
)
|
|
(2,182
|
)
|
|
(395
|
)
|
|||
Tax benefit
|
(872
|
)
|
|
(850
|
)
|
|
(164
|
)
|
|||
Net of tax
|
$
|
(1,367
|
)
|
|
$
|
(1,332
|
)
|
|
$
|
(231
|
)
|
|
|
|
|
|
|
||||||
Gains (losses) on available for sale securities
|
|
|
|
|
|
||||||
Interest income
|
$
|
(520
|
)
|
|
$
|
(1,126
|
)
|
|
$
|
1,134
|
|
Tax (benefit) provision
|
(201
|
)
|
|
(433
|
)
|
|
419
|
|
|||
Net of tax
|
$
|
(319
|
)
|
|
$
|
(693
|
)
|
|
$
|
715
|
|
|
|
|
|
|
|
||||||
Pension and Postretirement Benefit Plans (b)
|
|
|
|
|
|
||||||
Transition asset
|
$
|
8
|
|
|
$
|
8
|
|
|
$
|
9
|
|
Prior service costs
|
(166
|
)
|
|
(164
|
)
|
|
(171
|
)
|
|||
Actuarial losses
|
(40,606
|
)
|
|
(38,370
|
)
|
|
(43,969
|
)
|
|||
Total before tax
|
(40,764
|
)
|
|
(38,526
|
)
|
|
(44,131
|
)
|
|||
Tax benefit
|
(13,936
|
)
|
|
(14,430
|
)
|
|
(15,966
|
)
|
|||
Net of tax
|
$
|
(26,828
|
)
|
|
$
|
(24,096
|
)
|
|
$
|
(28,165
|
)
|
(b)
|
Reclassified from accumulated other comprehensive loss into selling, general and administrative expenses. These amounts are included in the computation of net periodic costs of defined benefit pension plans and nonpension postretirement benefit plans (see Note 12 for additional details).
|
|
Cash flow hedges
|
|
Available-for-sale securities
|
|
Pension and postretirement benefit plans
|
|
Foreign currency adjustments
|
|
Total
|
||||||||||
Balance January 1, 2015
|
$
|
(4,689
|
)
|
|
$
|
2,966
|
|
|
$
|
(786,079
|
)
|
|
$
|
(58,354
|
)
|
|
$
|
(846,156
|
)
|
Other comprehensive income (loss) before reclassifications (a)
|
546
|
|
|
(1,715
|
)
|
|
19,146
|
|
|
(91,436
|
)
|
|
(73,459
|
)
|
|||||
Amounts reclassified from accumulated other comprehensive income (loss) (a), (b)
|
231
|
|
|
(715
|
)
|
|
28,165
|
|
|
3,299
|
|
|
30,980
|
|
|||||
Net other comprehensive income (loss)
|
777
|
|
|
(2,430
|
)
|
|
47,311
|
|
|
(88,137
|
)
|
|
(42,479
|
)
|
|||||
Balance at December 31, 2015
|
(3,912
|
)
|
|
536
|
|
|
(738,768
|
)
|
|
(146,491
|
)
|
|
(888,635
|
)
|
|||||
Other comprehensive income (loss) before reclassifications (a)
|
1,095
|
|
|
(1,109
|
)
|
|
(73,141
|
)
|
|
(4,464
|
)
|
|
(77,619
|
)
|
|||||
Amounts reclassified from accumulated other comprehensive income (loss) (a), (b), (c)
|
1,332
|
|
|
693
|
|
|
24,096
|
|
|
—
|
|
|
26,121
|
|
|||||
Net other comprehensive income (loss)
|
2,427
|
|
|
(416
|
)
|
|
(49,045
|
)
|
|
(4,464
|
)
|
|
(51,498
|
)
|
|||||
Balance at December 31, 2016
|
(1,485
|
)
|
|
120
|
|
|
(787,813
|
)
|
|
(150,955
|
)
|
|
(940,133
|
)
|
|||||
Other comprehensive income (loss) before reclassifications (a)
|
(288
|
)
|
|
1,158
|
|
|
12,185
|
|
|
106,391
|
|
|
119,446
|
|
|||||
Amounts reclassified from accumulated other comprehensive income (loss) (a), (b), (c)
|
1,367
|
|
|
319
|
|
|
26,828
|
|
|
—
|
|
|
28,514
|
|
|||||
Net other comprehensive income (loss)
|
1,079
|
|
|
1,477
|
|
|
39,013
|
|
|
106,391
|
|
|
147,960
|
|
|||||
Balance at December 31, 2017
|
$
|
(406
|
)
|
|
$
|
1,597
|
|
|
$
|
(748,800
|
)
|
|
$
|
(44,564
|
)
|
|
$
|
(792,173
|
)
|
(c)
|
Foreign currency item amount represents the recognition of deferred translation upon the sale of certain businesses.
|
|
2017
|
|
2016
|
||||||||||
|
Shares
|
|
Weighted average grant date fair value
|
|
Shares
|
|
Weighted average grant date fair value
|
||||||
Outstanding - beginning of the year
|
1,609,459
|
|
|
$
|
17.50
|
|
|
1,727,214
|
|
|
$
|
18.30
|
|
Granted
|
1,995,473
|
|
|
13.24
|
|
|
826,546
|
|
|
17.20
|
|
||
Vested
|
(784,295
|
)
|
|
19.42
|
|
|
(822,290
|
)
|
|
19.91
|
|
||
Forfeited
|
(169,584
|
)
|
|
14.76
|
|
|
(122,011
|
)
|
|
19.97
|
|
||
Outstanding - end of the year
|
2,651,053
|
|
|
$
|
14.16
|
|
|
1,609,459
|
|
|
$
|
17.50
|
|
|
Years Ended December 31,
|
||||
|
2017
|
|
2016
|
||
Outstanding - beginning of the year
|
379,898
|
|
|
1,107,515
|
|
Granted
|
1,073,934
|
|
|
889,599
|
|
Performance adjustments
|
(226,154
|
)
|
|
(1,400,425
|
)
|
Forfeited
|
(82,653
|
)
|
|
(216,791
|
)
|
Outstanding - end of the year
|
1,145,025
|
|
|
379,898
|
|
|
2017
|
|
2016
|
||||||||||
|
Shares
|
|
Per share weighted average exercise prices
|
|
Shares
|
|
Per share weighted average exercise prices
|
||||||
Options outstanding - beginning of the year
|
9,122,762
|
|
|
$
|
27.13
|
|
|
8,771,600
|
|
|
$
|
31.26
|
|
Granted
|
2,553,510
|
|
|
13.16
|
|
|
1,758,760
|
|
|
16.87
|
|
||
Canceled
|
(63,517
|
)
|
|
20.34
|
|
|
(157,176
|
)
|
|
19.48
|
|
||
Expired
|
(1,117,716
|
)
|
|
46.88
|
|
|
(1,250,422
|
)
|
|
42.62
|
|
||
Options outstanding - end of the year
|
10,495,039
|
|
|
$
|
21.67
|
|
|
9,122,762
|
|
|
$
|
27.13
|
|
Options exercisable - end of the year
|
6,690,250
|
|
|
$
|
25.57
|
|
|
7,140,772
|
|
|
$
|
27.47
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||||
Range of per share exercise prices
|
|
Shares
|
|
Per share weighted-average exercise price
|
|
Weighted-average remaining contractual life
|
|
Shares
|
|
Per share weighted-average exercise price
|
|
Weighted-average remaining contractual life
|
||||||||
$13.11 - $14.26
|
|
2,653,510
|
|
|
$
|
13.17
|
|
|
8.9
|
years
|
|
100,000
|
|
|
$
|
13.39
|
|
|
4.9
|
years
|
$14.27 - $21.89
|
|
2,347,595
|
|
|
17.07
|
|
|
7.2
|
years
|
|
1,296,316
|
|
|
17.22
|
|
|
6.4
|
years
|
||
$21.90 - $24.77
|
|
2,683,597
|
|
|
23.29
|
|
|
2.3
|
years
|
|
2,683,597
|
|
|
23.29
|
|
|
2.3
|
years
|
||
$24.78 - $36.96
|
|
2,810,337
|
|
|
31.98
|
|
|
1.8
|
years
|
|
2,610,337
|
|
|
32.53
|
|
|
1.3
|
years
|
||
|
|
10,495,039
|
|
|
$
|
21.67
|
|
|
4.9
|
years
|
|
6,690,250
|
|
|
$
|
25.57
|
|
|
2.8
|
years
|
|
Years Ended December 31,
|
||||
|
2017
|
|
2016
|
||
Expected dividend yield
|
5.7
|
%
|
|
4.5
|
%
|
Expected stock price volatility
|
29.7
|
%
|
|
29.0
|
%
|
Risk-free interest rate
|
2.3
|
%
|
|
1.6
|
%
|
Expected life
|
7 years
|
|
|
7 years
|
|
Weighted-average fair value per option granted
|
$2.00
|
|
$2.85
|
||
Fair value of options granted
|
$5,107
|
|
$5,013
|
|
First
Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
|
Total
|
||||||||||
2017
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
$
|
836,640
|
|
|
$
|
821,371
|
|
|
$
|
842,820
|
|
|
$
|
1,049,117
|
|
|
$
|
3,549,948
|
|
Cost of revenues
|
374,174
|
|
|
382,565
|
|
|
401,306
|
|
|
564,624
|
|
|
1,722,669
|
|
|||||
Operating expenses
|
365,917
|
|
|
384,953
|
|
|
366,549
|
|
|
426,871
|
|
|
1,544,290
|
|
|||||
Income from continuing operations before income taxes
|
96,549
|
|
|
53,853
|
|
|
74,965
|
|
|
57,622
|
|
|
282,989
|
|
|||||
Provision for income taxes
|
31,416
|
|
|
4,952
|
|
|
17,607
|
|
|
(32,326
|
)
|
|
21,649
|
|
|||||
Net income - Pitney Bowes Inc.
|
$
|
65,133
|
|
|
$
|
48,901
|
|
|
$
|
57,358
|
|
|
$
|
89,948
|
|
|
$
|
261,340
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic earnings per share
(1)
|
$
|
0.35
|
|
|
$
|
0.26
|
|
|
$
|
0.31
|
|
|
$
|
0.48
|
|
|
$
|
1.40
|
|
Diluted earnings per share
(1)
|
$
|
0.35
|
|
|
$
|
0.26
|
|
|
$
|
0.31
|
|
|
$
|
0.48
|
|
|
$
|
1.39
|
|
|
First
Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
|
Total
|
||||||||||
2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
$
|
844,589
|
|
|
$
|
835,886
|
|
|
$
|
839,031
|
|
|
$
|
887,069
|
|
|
$
|
3,406,575
|
|
Cost of revenues
|
365,241
|
|
|
372,144
|
|
|
376,987
|
|
|
400,306
|
|
|
1,514,678
|
|
|||||
Operating expenses
(1)
|
379,684
|
|
|
370,504
|
|
|
368,451
|
|
|
526,888
|
|
|
1,645,527
|
|
|||||
Income from continuing operations before income taxes
|
99,664
|
|
|
93,238
|
|
|
93,593
|
|
|
(40,125
|
)
|
|
246,370
|
|
|||||
Provision for income taxes
|
37,024
|
|
|
33,394
|
|
|
23,197
|
|
|
38,204
|
|
|
131,819
|
|
|||||
Income from continuing operations
|
62,640
|
|
|
59,844
|
|
|
70,396
|
|
|
(78,329
|
)
|
|
114,551
|
|
|||||
(Loss) from discontinued operations
|
—
|
|
|
(1,660
|
)
|
|
(291
|
)
|
|
(750
|
)
|
|
(2,701
|
)
|
|||||
Net income before attribution of noncontrolling interests
|
62,640
|
|
|
58,184
|
|
|
70,105
|
|
|
(79,079
|
)
|
|
111,850
|
|
|||||
Less: Preferred stock dividends of subsidiaries attributable to noncontrolling interests
|
4,594
|
|
|
4,594
|
|
|
4,593
|
|
|
5,264
|
|
|
19,045
|
|
|||||
Net income (loss) - Pitney Bowes Inc.
|
$
|
58,046
|
|
|
$
|
53,590
|
|
|
$
|
65,512
|
|
|
$
|
(84,343
|
)
|
|
$
|
92,805
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Amounts attributable to common stockholders:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
$
|
58,046
|
|
|
$
|
55,250
|
|
|
$
|
65,803
|
|
|
$
|
(83,593
|
)
|
|
$
|
95,506
|
|
Loss from discontinued operations
|
—
|
|
|
(1,660
|
)
|
|
(291
|
)
|
|
(750
|
)
|
|
(2,701
|
)
|
|||||
Net income - Pitney Bowes Inc.
|
$
|
58,046
|
|
|
$
|
53,590
|
|
|
$
|
65,512
|
|
|
$
|
(84,343
|
)
|
|
$
|
92,805
|
|
Basic earnings per share attributable to common stockholders
(2)
:
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations
|
$
|
0.30
|
|
|
$
|
0.29
|
|
|
$
|
0.35
|
|
|
$
|
(0.45
|
)
|
|
$
|
0.51
|
|
Discontinued operations
|
—
|
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|
(0.01
|
)
|
|||||
Net income - Pitney Bowes Inc.
|
$
|
0.30
|
|
|
$
|
0.28
|
|
|
$
|
0.35
|
|
|
$
|
(0.45
|
)
|
|
$
|
0.49
|
|
Diluted earnings per share attributable to common stockholders
(2):
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations
|
$
|
0.30
|
|
|
$
|
0.29
|
|
|
$
|
0.35
|
|
|
$
|
(0.45
|
)
|
|
$
|
0.51
|
|
Discontinued operations
|
—
|
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|
(0.01
|
)
|
|||||
Net income - Pitney Bowes Inc.
|
$
|
0.30
|
|
|
$
|
0.28
|
|
|
$
|
0.35
|
|
|
$
|
(0.45
|
)
|
|
$
|
0.49
|
|
Description
|
|
Balance at beginning of year
|
|
Additions charged to expense
|
|
Deductions
|
|
Balance at end of year
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Allowance for doubtful accounts
|
||||||||||||||||
2017
|
|
$
|
14,372
|
|
|
$
|
9,770
|
|
|
$
|
(8,157
|
)
|
|
$
|
15,985
|
|
2016
|
|
$
|
9,997
|
|
|
$
|
6,797
|
|
|
$
|
(2,422
|
)
|
|
$
|
14,372
|
|
2015
|
|
$
|
12,455
|
|
|
$
|
430
|
|
|
$
|
(2,888
|
)
|
|
$
|
9,997
|
|
|
|
|
|
|
|
|
|
|
||||||||
Valuation allowance for deferred tax asset
|
||||||||||||||||
2017
|
|
$
|
127,095
|
|
|
$
|
53,782
|
|
|
$
|
(2,721
|
)
|
|
$
|
178,156
|
|
2016
|
|
$
|
132,624
|
|
|
$
|
6,523
|
|
|
$
|
(12,052
|
)
|
|
$
|
127,095
|
|
2015
|
|
$
|
116,935
|
|
|
$
|
21,232
|
|
|
$
|
(5,543
|
)
|
|
$
|
132,624
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Marc B. Lautenbach
Marc B. Lautenbach
|
|
President and Chief Executive Officer - Director
|
|
February 22, 2018
|
/s/ Stanley J. Sutula III
Stanley J. Sutula III |
|
Executive Vice President, Chief Financial Officer (Principal Financial Officer)
|
|
February 22, 2018
|
/s/ Joseph R. Catapano
Joseph R. Catapano
|
|
Vice President, Chief Accounting Officer (Principal Accounting Officer)
|
|
February 22, 2018
|
/s/ Michael I. Roth
Michael I. Roth
|
|
Non-Executive Chairman - Director
|
|
February 22, 2018
|
/s/ Linda G. Alvarado
Linda G. Alvarado
|
|
Director
|
|
February 22, 2018
|
/s/ Anne M. Busquet
Anne M. Busquet
|
|
Director
|
|
February 22, 2018
|
/s/ Roger Fradin
Roger Fradin
|
|
Director
|
|
February 22, 2018
|
/s/ Anne Sutherland Fuchs
Anne Sutherland Fuchs
|
|
Director
|
|
February 22, 2018
|
/s/ S. Douglas Hutcheson
S. Douglas Hutcheson
|
|
Director
|
|
February 22, 2018
|
/s/ Eduardo R. Menasc
é
Eduardo R. Menascé
|
|
Director
|
|
February 22, 2018
|
/s/ Linda S. Sanford
Linda S. Sanford
|
|
Director
|
|
February 22, 2018
|
/s/ David L. Shedlarz
David L. Shedlarz
|
|
Director
|
|
February 22, 2018
|
/s/ David B. Snow, Jr.
David B. Snow, Jr.
|
|
Director
|
|
February 22, 2018
|
1.1
|
Purpose 1
|
2.1
|
Annual Incentive 2
|
2.2
|
Annual Incentive Award 2
|
2.3
|
Annual Salary 2
|
2.4
|
Board 2
|
2.5
|
Change of Control 2
|
2.6
|
Code 3
|
2.7
|
Company 3
|
2.8
|
Date of the Change of Control 3
|
2.9
|
Date of Termination 3
|
2.10
|
Employee 4
|
2.11
|
ERISA 4
|
2.12
|
Participant 4
|
2.13
|
Plan 4
|
2.14
|
Restatement Effective Date 4
|
2.15
|
Separation Period 4
|
SECTION V - TERMINATION OF EMPLOYMENT
|
9
|
SECTION VIII – ADDITIONAL PAYMENTS
|
13
|
1.1
|
The purpose of the Plan is to provide certain designated senior executive employees with continued compensation and benefits, subject to the specific terms and conditions set forth in the Plan, in the event there is a Change of Control and the covered executive incurs a Termination of Employment. In addition, the Plan is intended to provide an incentive to covered executives to continue to perform their job duties on behalf of the Company where the Company is faced with a Change of Control. No Change of Control has occurred under the terms of the Plan as of the effective date of this restatement.
|
2.1
|
“
Annual Incentive
” shall mean the annual incentive, also referred to as the Pitney Bowes Incentive Plan (PBIP), that a Participant is eligible to earn under the Pitney Bowes Key Employee Incentive Plan.
|
2.2
|
“
Annual Incentive Award
” shall mean a Participant’s Annual Salary multiplied by the current incentive target percentage established for the Participant.
|
2.3
|
“
Annual Salary
” shall mean the Participant’s regular annual base salary in effect immediately prior to his or her Date of Termination, including cash compensation converted to other benefits under a flexible benefit arrangement maintained by the Company or deferred pursuant to a written plan or agreement with the Company, but excluding any type of allowances, reimbursements, premium pay, Cash Incentive Units, sign-on bonus, stock options and any actual gain thereon, prizes, awards, special bonuses and incentive payments other than the Annual Incentive.
|
2.4
|
“
Board
” shall mean the Board of Directors of the Company.
|
2.5
|
"
Change of Control
" For purposes of this Plan, a "Change of Control" shall be
|
2.6
|
“
Code
” shall mean the Internal Revenue Code of 1986, as amended from time to time.
|
2.7
|
"
Company
" shall mean Pitney Bowes Inc. and any successor thereto.
|
2.8
|
“
Date of the Change of Control
” shall mean the date on which a Change of Control is determined to first occur.
|
2.9
|
“
Date of Termination
” shall mean the date on which a Participant incurs a Termination of Employment as defined in Section 5.1 hereof.
|
2.11
|
“
ERISA
” shall mean the Employee Retirement Income Security Act of 1974, as amended, and the regulations thereunder.
|
2.12
|
“
Participant
” shall mean an Employee who is designated as a Participant pursuant to Section III hereof.
|
2.13
|
“
Plan
” shall mean the Pitney Bowes Senior Executive Severance Policy as amended and restated effective as of March 1, 2013.
|
2.14
|
“
Restatement Effective Date
” shall mean September 11, 2017.
|
2.15
|
“
Separation Period
” shall mean (i) for Participants who are in compensation Bands I or J on the Change of Control, the period beginning on a Participant’s Date of Termination and ending on the second anniversary thereof (ii) for Participants who are in compensation Band H, or Participants who are elected corporate officers of Pitney Bowes Inc. but not in compensation Bands I or J, the period beginning on a Participant's Date of Termination and ending on the expiration of 78 weeks following the Participant’s Date of Termination.
|
3.1
|
Each Employee who falls within compensation Bands H, I or J or who is an elected corporate officer of Pitney Bowes Inc. not in compensation Bands H, I or J shall be a Participant in the Plan.
|
3.2
|
Prior to the time a Change of Control has occurred, the Board may, in its sole discretion, without notice, amend, modify or terminate the eligibility of certain individual Employees or classes of Employees or Participants to participate in the Plan; provided, however, that such eligibility or participation may not be so amended, modified or terminated in connection with an actual, threatened, or proposed Change of Control in any manner which would result in an Employee or Participant otherwise becoming ineligible to participate in the Plan; and provided further that any amendment, modification or termination of the definition of an Employee or Participant’s participation in the Plan occurring within one year prior to a Change of Control shall be deemed to be in connection with an actual, threatened, or proposed Change of Control and shall be void.
|
4.1
|
If any Participant incurs a Termination of Employment within two years after a Change of Control occurs (whether or not such termination is a result of such Change of Control) or a Participant is terminated within sixty (60) days before a Change of Control at the request of a third party who has taken steps reasonably calculated to effect a Change of Control or otherwise in connection with or in anticipation of a Change of Control, and a Change of Control subsequently occurs, the Company shall pay such Participant separation benefits as determined in Section 4.2 hereof and the benefits as determined in Sections 4.3 and 4.4 hereof. For purposes of determining the benefits set forth in Sections 4.3 and 4.4, if the Participant incurs a Termination of Employment following a reduction of the Participant’s Annual Salary, opportunity to earn an Annual Incentive, or other compensation or employee benefits, such reduction shall not be given effect. Separation benefits as described in this Section shall be paid either (a) in one lump sum within fifteen (15) days of the Date of Termination or (b) in a stream of payments payable on regular pay periods following the Date of Termination only if the Change of Control event does not meet the definition of “change of control” under IRC Section 409A (as defined in Section 9.4 herein) and if required to be paid in that fashion by IRC 409A to avoid the additional tax imposed by IRC Section 409A; with such stream of payments continuing over the severance period used to calculate the severance benefits under Section 4.2 herein. If the termination of employment occurs before the Change of Control and is on account of the Change of Control, “fifteen (15) days” in the immediately prior sentence becomes “ninety (90) days” of the Date of Termination.
|
4.2
|
Separation benefits described in Section 4.1 hereof shall be determined as described below:
|
(a)
|
For a Participant in compensation Bands I or J, an amount equal to the product of (1) two times (2) the sum of (x) the Participant’s Annual Salary and (y) the Participant’s Annual Incentive Award.
|
(b)
|
An amount equal to the difference between (1) the lump sum actuarial equivalent of the benefit under the Company’s qualified defined benefit retirement plan (the “Pension Plan”) and any excess or supplemental defined benefit retirement plans in which the Participant participates (collectively, the “Pension Restoration Plan”) which the Participant would receive if his or her employment continued during the Separation Period, assuming the Participant is fully vested in his or her benefit under the Pension Plan as of the Date of Termination, and (2) the lump sum actuarial equivalent of the Participant’s actual benefit (paid or payable), if any, under the Pension Plan and the Pension Restoration Plan as of the Date of Termination. For purposes of the calculation required under subsection 4.2(b)(1), only the Participant’s additional months of age and service accrued during the Separation Period, but not the Participant’s compensation earned during the Separation Period, shall be taken into account. This calculation shall be performed on the same basis as if the Participant had remained actively employed throughout the entire Separation Period, except that the Participant’s earnings used in calculating the Participant’s highest average earnings shall cease on the day before the Separation Period begins. The calculation of this amount shall be performed using the same factors employed under the Pension Plan and Participant’s compensation earned through the Date of Termination. The actuarial determination hereunder shall be made as of the Date of Termination and the actuarial assumptions used for purposes of determining actuarial equivalence shall be no less favorable to the Participant than the most favorable of those in effect under the Retirement Plan and the Pension Restoration Plan on the Date of Termination. Any Pension Restoration Plan payment shall be made in accordance with the payment election the Participant made under the Pension Restoration Plan.
|
4.3
|
During the Separation Period, the Participant and his or her Dependents shall continue to be provided with the medical, prescription drug, dental and life insurance and other health and welfare benefits in which the Participant has coverage under the plans or programs of the Company or its affiliates at the Date of Termination as if the Participant’s employment had not been terminated, unless the Participant elects to decline such coverage; provided, however, that if the Participant becomes reemployed with another employer and is eligible to receive a particular benefit described above under another employer‑provided plan, the medical and other welfare benefits described herein shall be secondary to those provided under such other plan during such applicable period of eligibility. For purposes of determining eligibility (but not the time of commencement of benefits) of the Participant for retiree medical, dental and life insurance benefits under the Company’s plans, practices, programs and policies, the Participant shall be considered to have remained employed during the Separation Period and to have retired or terminated employment on the last day of such period. The “COBRA” continuation period for a Participant shall commence following the last day of the Separation Period.
|
|
of Control, but at a cost to the Company of not more than the lesser of (i) 12% of Annual Salary and (ii) fifty thousand dollars ($50,000.00).
|
4.5
|
To the extent any benefits described in this Section 4 cannot be provided to the Participant pursuant to the appropriate plan or program maintained for Company employees in which a Participant participates, including, without limitation, because the coverage would cause the benefit plan to become discriminatory, the Company shall provide such benefits outside such plan or program at no additional cost (including, without limitation, tax cost) to the Participant.
|
5.1
|
For purposes of the Plan, "Termination of Employment" shall include a termination of employment by the Participant for any of the following Good Reasons, subject to Section 5.3 below:
|
4.
|
The Company’s requiring the Participant, after a Change of Control, to
|
5.2
|
Any termination by the Company or by the Participant in accordance with Section 5.1 shall be communicated by a Notice of Termination to the other party. Any Notice of Termination shall be by written instrument which (i) indicates the specific termination provision in Section 5.1 above relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for
|
5.3
|
Notwithstanding the foregoing, a Termination of Employment for Good Reason under Section 5.1 shall not occur if, within 30 days after the date the Participant gives a Notice of Termination to the Company after a Change of Control, the Company corrects the action or failure to act that constitutes the grounds for termination for Good Reason as described in Section 5.1 and as set forth in the Participant’s Notice of Termination. If the Company does not correct the action or failure to act, the Participant must terminate his or her employment for Good Reason within 60 days after the end of the cure period, in order for the termination to be considered a Good Reason termination.
|
6.1
|
The Plan Administrator shall be the Board or its delegate. If an Employee or former Employee makes a written request alleging a right to receive benefits under this Plan or alleging a right to receive an adjustment in benefits being paid under the Plan, the Board shall treat it as a claim for benefits. All claims for benefits under the Plan shall be sent to the Executive Vice President Chief Human Resources Officer, or equivalent position, and must be received within 90 days after Termination of Employment. If the Board determines that any individual who has claimed a right to receive benefits, or different benefits, under the Plan is not entitled to receive all or any part of the benefits claimed, it will inform the claimant in writing of its determination and the reasons therefore in terms calculated to be understood by the claimant. The notice will be sent within 90 days of the claim unless the Board determines additional time, not exceeding 90 days, is needed. The notice shall make specific reference to the pertinent Plan provisions on which the denial is based, and describe any additional material or information as necessary. Such notice shall, in addition, inform the claimant what procedure the claimant should follow to take advantage of the review procedures set forth below in the event the claimant desires to contest the denial of the claim. The claimant may within 90 days thereafter submit in writing to the Board a notice that the claimant contests the denial of his or her claim by the Board and desires a further review. The Board shall within 60 days thereafter review the claim and authorize the claimant and his or her personal representative to appear personally and review pertinent documents and submit issues and comments relating to the claim to the persons responsible for making the determination on behalf of the Board. The Board will render its final decision with specific reasons therefore in writing and will transmit it to the claimant within 60 days of the written request for review, unless the Board determines additional time, not exceeding 60 days, is needed, and so notifies the Participant. If the Company fails to respond to a claim filed in accordance with the foregoing within 60 days or any such extended period, the Company shall be deemed to have denied the claim.
|
7.1
|
This Plan is established by the Company on a voluntary basis and not as consideration for services rendered in the past, and the benefits herein are provided at the will of the Company. Neither the establishment of this Plan nor the payment of benefits by the Company shall be construed or interpreted as a condition of employment, nor shall this Plan modify or enlarge any rights of any person covered by it to be continued or to be retained in the employ of the Company.
|
8.1
|
In the event that any benefits payable to a Participant pursuant to the Plan (“Payments”) (i) constitute “parachute payments” within the meaning of Section 280G of the Code, and (ii) but for this Section VIII would be subject to the excise tax imposed by Section 4999 of the Code, or any comparable successor provisions (the “Excise Tax”), then the Eligible Individual’s Payments hereunder shall be either (x) provided to the Participant in full, or (y) provided to the Participant as to such lesser extent which would result in no portion of such benefits being subject to the Excise Tax, whichever of the foregoing amounts, when taking into account applicable federal, state, local and foreign income and employment taxes, the Excise Tax, and any other applicable taxes, results in the receipt by the Participant, on an after-tax basis, of the greatest amount of benefits, notwithstanding that all or some portion of such benefits may be taxable under the Excise Tax. In the event that the payments and/or benefits are to be reduced pursuant to this Section VIII, such payments and benefits shall be reduced such that the reduction of compensation to be provided to the Participant as a result of this Section VIII is minimized. In applying this principle, the reduction shall be made in a manner consistent with the requirements of Section 409A of the Code and where two economically equivalent amounts are subject to reduction but payable at different times, such amounts shall be reduced on a pro rata basis but not below zero. Unless the Company and the Participant otherwise agree in writing, any determination required under this Section VIII shall be made in writing, in good faith and following the intent of this section by a nationally recognized accounting firm selected by the Company (the “Accountants”). The Company shall bear all costs the Accountants may reasonably incur in connection with any calculations contemplated by this Section VIII.
|
9.1
|
Non‑Alienability
. No benefit or payments provided hereunder shall be subject to any forms of sale, assignment or transfer. Benefits provided by this Plan shall not be subject to attachment, garnishment or other legal or equitable proceedings by creditors or persons representing creditors. Such payments are, however, subject to all applicable taxes and appropriate withholdings.
|
9.2
|
Eligibility for Other Benefits
. This Plan shall have no effect on the Participant’s eligibility for other benefits customarily provided after termination unless otherwise stated in a written agreement executed by an authorized representative of the Company. The payments of benefits under this Plan shall not be deemed to be a continuation of employment, pay, or credited service for purposes of determining the availability, nature, or extent of the Company's benefit plans, programs or policies, except as expressly set forth herein.
|
9.3
Unfunded Plan Status
.
|
This Plan is intended to be an unfunded plan maintained primarily for the purpose of providing nonqualified deferred compensation for a select group of management or highly compensated employees, within the meaning of Section 401 of ERISA. This Plan is not intended to qualify as an ERISA welfare benefit plan. All payments pursuant to the Plan shall be made from the general funds of the Company and no special or separate fund shall be established or other segregation of assets made to assure payment. No Participant or other person shall have under any circumstances any interest in any particular property or assets of the Company as a result of participating in the Plan. Notwithstanding the foregoing, the Company may (but shall not be obligated to) create one or more grantor trusts, the assets of which are subject to the claims of the Company’s creditors, to assist it in accumulating funds to pay its obligations under the Plan.
|
9.4
|
Death
. In case of death, any unpaid payment or benefits to which the Participant was entitled at the time of death shall be paid to the Participant’s survivors or estate
|
9.5
|
I.R.C. Section 409A
. If and to the extent that Section 409A of the Internal Revenue Code applies to amounts payable under the Plan, distributions may only be made under the Plan upon an event and in a manner permitted by Section 409A. To the extent that any provision of the Plan would cause a conflict with any applicable requirements of Section 409A, or would cause the administration of the Plan to fail to satisfy the applicable requirements of section 409A, such provision shall be deemed null and void. It is intended that this Plan comply with the Change of Control provisions of Section 409A.
|
9.6
|
Validity and Severability
. The invalidity or unenforceability of any provision of the Plan shall not affect the validity or enforceability of any other provision of the Plan, which shall remain in full force and effect, and any prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
|
9.7
|
Governing Law
.
The validity, interpretation, construction and performance of the Plan shall in all respects be governed by the laws of the State of Connecticut without reference to principles of conflict of law, except to the extent pre‑empted by federal law.
|
9.8
|
Plan Records
. The records for this Plan are kept on a plan year beginning on January 1 and ending on the following December 31.
|
9.9
|
Legal Service
. The person designated to receive legal papers or summons in connection with this Plan is the Corporate Secretary, Pitney Bowes Inc., World Headquarters, Stamford CT 06926‑0700.
|
|
Years Ended December 31,
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations before income taxes
|
$
|
282,989
|
|
|
$
|
246,370
|
|
|
$
|
610,825
|
|
|
$
|
431,196
|
|
|
$
|
383,954
|
|
Add:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
(1)
|
171,845
|
|
|
148,044
|
|
|
162,909
|
|
|
174,661
|
|
|
195,368
|
|
|||||
Portion of rents representative of the interest factor
|
15,340
|
|
|
14,927
|
|
|
15,807
|
|
|
18,367
|
|
|
22,259
|
|
|||||
Amortization of capitalized interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
973
|
|
|||||
Income as adjusted
|
$
|
470,174
|
|
|
$
|
409,341
|
|
|
$
|
789,541
|
|
|
$
|
624,224
|
|
|
$
|
602,554
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed charges:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
(1)
|
$
|
171,845
|
|
|
$
|
148,044
|
|
|
$
|
162,909
|
|
|
$
|
174,661
|
|
|
$
|
195,368
|
|
Portion of rents representative of the interest factor
|
15,340
|
|
|
14,927
|
|
|
15,807
|
|
|
18,367
|
|
|
22,259
|
|
|||||
Noncontrolling interests (preferred stock dividends of subsidiaries), excluding taxes
|
—
|
|
|
30,917
|
|
|
29,878
|
|
|
29,878
|
|
|
27,841
|
|
|||||
Total fixed charges
|
$
|
187,185
|
|
|
$
|
193,888
|
|
|
$
|
208,594
|
|
|
$
|
222,906
|
|
|
$
|
245,468
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ratio of earnings to fixed charges
(2)
|
2.51
|
|
2.11
|
|
3.79
|
|
2.80
|
|
2.45
|
(1)
|
Interest expense includes both financing interest expense and other interest expense.
|
(2)
|
The computation of the ratio of earnings to fixed charges has been computed by dividing income from continuing operations before income taxes as adjusted by fixed charges. Included in fixed charges is one-third of rent expense as the representative portion of interest.
|
Subsidiary Name
|
Country or state of incorporation
|
Alternative Mail & Parcels Investments Ltd
|
United Kingdom
|
AtLast Holdings Inc.
|
Colorado
|
B. Williams Funding Corp.
|
Delaware
|
Borderfree Canada, Inc.
|
Canada
|
Borderfree Limited
|
Ireland
|
Borderfree Research and Development Ltd.
|
Israel
|
Borderfree Trading (Shanghai) Co., Ltd.
|
China
|
Borderfree UK Limited
|
United Kingdom
|
Borderfree, Inc.
|
Delaware
|
BoxHop LLC
|
Delaware
|
Elmcroft Road Realty Corporation
|
Connecticut
|
Enroute Systems Corporation
|
Deleware
|
FSL Holdings Inc.
|
Connecticut
|
FSL Risk Managers Inc.
|
New York
|
Group 1 Software China Ltd.
|
Hong Kong
|
Harvey Company, L.L.C
|
Delaware
|
Intreprinderea Cu Capital Strain "Tacit Knowledge" S.R.L (Moldova)
|
Republic of Moldova
|
MapInfo Realty LLC
|
New York
|
MOUNT VERDE INSURANCE COMPANY, INC.
|
Vermont
|
Newgistics, Inc.
|
Delaware
|
NGS Holdings, Inc.
|
Delaware
|
NGS Intermediate Holdings, Inc.
|
Delaware
|
OLDEMT LIMITED
|
United Kingdom
|
OldEurope Limited
|
United Kingdom
|
OldMS Limited
|
United Kingdom
|
OLDPBIMS Limited
|
United Kingdom
|
OldPBSL
|
United Kingdom
|
PB Can LP II
|
Canada
|
PB Can US Holding LLC
|
Delaware
|
PB Equipment Management Inc.
|
Delaware
|
PB European UK LLC
|
Delaware
|
PB Nova Scotia Holding Inc.
|
Delaware
|
PB Nova Scotia Holdings ULC
|
Canada
|
PB Nova Scotia II ULC
|
Canada
|
PB Nova Scotia VI ULC
|
Canada
|
PB Nova Scotia VII ULC
|
Canada
|
PB Professional Services Inc.
|
Delaware
|
PB US Can LLC
|
Delaware
|
PB Worldwide Inc,
|
Delaware
|
Pitney Bowes (Asia Pacific) Pte. Ltd
|
Singapore
|
Pitney Bowes (Switzerland) AG
|
Switzerland
|
Pitney Bowes Australia FAS Pty Limited
|
Australia
|
Pitney Bowes Australia Pty Limited
|
Australia
|
Pitney Bowes Brasil Equipamentos e Servicos Ltda
|
Brazil
|
Pitney Bowes Canada II LP
|
Canada
|
Pitney Bowes Credit Australia Limited
|
Australia
|
Pitney Bowes Danmark A/S
|
Denmark
|
Pitney Bowes Deutschland GmbH
|
Germany
|
Pitney Bowes Finance Ireland Limited
|
Ireland
|
Pitney Bowes Finance Limited
|
United Kingdom
|
Pitney Bowes Funding SRL
|
Barbados
|
Pitney Bowes Global Financial Services LLC
|
Delaware
|
Pitney Bowes Global Limited
|
United Kingdom
|
Pitney Bowes Global LLC
|
Delaware
|
Pitney Bowes Holdco Limited
|
United Kingdom
|
Pitney Bowes Holding SNC
|
France
|
Pitney Bowes Holdings Limited
|
United Kingdom
|
Pitney Bowes India Private Limited
|
India
|
Pitney Bowes International Finance Limited
|
United Kingdom
|
Pitney Bowes International Holdings, Inc.
|
Delaware
|
Pitney Bowes Ireland Limited
|
Ireland
|
Pitney Bowes Italia S.r.l.
|
Italy
|
Pitney Bowes Japan K.K.
|
Japan
|
Pitney Bowes Limited
|
United Kingdom
|
Pitney Bowes Luxembourg Holding II S.a.r.l.
|
Luxembourg
|
Pitney Bowes Luxembourg Holding S.a.r.l.
|
Luxembourg
|
Pitney Bowes New Zealand Limited
|
New Zealand
|
Pitney Bowes Norge AS
|
Norway
|
Pitney Bowes Nova Scotia ULC
|
Canada
|
Pitney Bowes of Canada Ltd. - Pitney Bowes du Canada Ltee
|
Canada
|
Pitney Bowes Oy
|
Finland
|
Pitney Bowes PayCo Australia PTY LTD
|
Australia
|
Pitney Bowes PayCo Canada Ltd.
|
Canada
|
Pitney Bowes PayCo EMR Limited
|
United Arab Emirates
|
Pitney Bowes PayCo Holdings Limited
|
Ireland
|
Pitney Bowes PayCo Hong Kong Limited
|
Hong Kong
|
Pitney Bowes PayCo Japan KK
|
Japan
|
Pitney Bowes PayCo Korea Ltd
|
South Korea
|
Pitney Bowes PayCo Mexico, S. DE R.L. DE C.V.
|
Mexico
|
Pitney Bowes PayCo Singapore Pte Ltd
|
Singapore
|
Pitney Bowes PayCo Switzerland GmbH
|
Switzerland
|
Pitney Bowes PayCo UK Limited
|
United Kingdom
|
Pitney Bowes PayCo US Inc.
|
Delaware
|
Pitney Bowes Polska Sp. z.o.o.
|
Poland
|
Pitney Bowes Presort Services, Inc.
|
Delaware
|
Pitney Bowes Properties Inc.
|
Connecticut
|
Pitney Bowes Puerto Rico, Inc.
|
Puerto Rico
|
Pitney Bowes SAS
|
France
|
Pitney Bowes Shelton Realty LLC
|
Connecticut
|
Pitney Bowes Software (Beijing) Ltd
|
China
|
Pitney Bowes Software Canada Inc.
|
Canada
|
Pitney Bowes Software Europe Limited
|
United Kingdom
|
Pitney Bowes Software Holdings Limited
|
United Kingdom
|
Pitney Bowes Software Inc.
|
Delaware
|
Pitney Bowes Software India Private Limited
|
India
|
Pitney Bowes Software Pte. Ltd
|
Singapore
|
Pitney Bowes Software Pty Ltd
|
Australia
|
Pitney Bowes Software SAS
|
France
|
Pitney Bowes Svenska Aktiebolag
|
Sweden
|
Pitney Bowes UK LP
|
United Kingdom
|
PitneyWorks.com Inc.
|
Delaware
|
PitneyWorks.com L.L.C.
|
Delaware
|
Portrait International, Inc.
|
Ohio
|
Portrait Million Handshakes AS
|
Norway
|
Portrait Software International Limited
|
United Kingdom
|
Portrait Software Limited
|
United Kingdom
|
Quadstone Paramics Ltd
|
Scotland
|
Real Time Content Limited
|
United Kingdom
|
Tacit Knowledge Latin America, S. de R.L de C.V.
|
Mexico
|
Tacit Knowledge Ltd. (UK)
|
United Kingdom
|
Tacit Knowledge, Inc.
|
California
|
Technopli SARL
|
France
|
The Pitney Bowes Bank, Inc.
|
Utah
|
Wheeler Insurance, Ltd.
|
Vermont
|
1.
|
I have reviewed this Annual Report on Form 10-K of Pitney Bowes Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Marc B. Lautenbach
|
|
|
|
|
Marc B. Lautenbach
|
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
1.
|
I have reviewed this Annual Report on Form 10-K of Pitney Bowes Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Stanley J. Sutula III
|
|
|
|
Stanley J. Sutula III
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Marc B. Lautenbach
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Marc B. Lautenbach
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President and Chief Executive Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Stanley J. Sutula III
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Stanley J. Sutula III
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Executive Vice President and Chief Financial Officer
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