<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
FORM 10 - Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1994
OR
___ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _____________ to _____________
Commission File Number: 1-3579
PITNEY BOWES INC.
State of Incorporation IRS Employer Identification No.
Delaware 06-0495050
World Headquarters
Stamford, Connecticut 06926-0700
Telephone Number: (203) 356-5000
The Registrant (1) has filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months, and (2) has been subject to such filing requirements for the
past 90 days. Yes X No_____
Number of shares of common stock, $2 par value, outstanding as of March
31, 1994 is 158,188,833.
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 2 of 15
Pitney Bowes Inc.
Index
Page Number
Part I - Financial Information:
Consolidated Statement of Income - Three Months
Ended March 31, 1994 and 1993. . . . . . . . . . . . . . . . 3
Consolidated Balance Sheet - March 31, 1994
and December 31, 1993. . . . . . . . . . . . . . . . . . . . 4
Consolidated Statement of Cash Flows -
Three Months Ended March 31, 1994 and 1993 . . . . . . . . . 5
Notes to Consolidated Financial Statements . . . . . . . . . . 6 - 7
Management's Discussion and Analysis of
Financial Condition and Results of Operations. . . . . . . . 8 - 11
Part II - Other Information:
Item 6: Exhibits and Reports on Form 8-K. . . . . . . . . . . 12
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Exhibit (i) - Computation of Earnings per Share. . . . . . . . . 14
Exhibit (ii) - Computation of Ratio of Earnings
to Fixed Charges. . . . . . . . . . . . . . . . 15
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 3 of 15
Part I - Financial Information
Pitney Bowes Inc.
Consolidated Statement of Income
(Unaudited)
<TABLE>
(Dollars in thousands, except per share data)
<CAPTION> Three Months Ended March 31,
1994 1993
<S> <C> <C>
Revenue from:
Sales. . . . . . . . . . . . . . . . . . . . $ 416,604 $ 379,318
Rentals and financing. . . . . . . . . . . . 330,720 324,878
Support services . . . . . . . . . . . . . . 129,453 129,228
Total revenue. . . . . . . . . . . . . . . 876,777 833,424
Costs and expenses:
Cost of sales. . . . . . . . . . . . . . . . 232,661 207,414
Cost of rentals and financing. . . . . . . . 103,191 101,711
Selling, service and administrative. . . . . 328,839 319,152
Research and development . . . . . . . . . . 23,729 26,006
Interest, net. . . . . . . . . . . . . . . . 41,499 48,762
Total costs and expenses . . . . . . . . . 729,919 703,045
Income before income taxes . . . . . . . . . . 146,858 130,379
Provision for income taxes . . . . . . . . . . 54,996 48,319
Income before effect of a change
in accounting for postemployment
benefits . . . . . . . . . . . . . . . . . . 91,862 82,060
Effect of a change in accounting for
postemployment benefits. . . . . . . . . . . (119,532) -
Net (loss) income. . . . . . . . . . . . . . . $ (27,670) $ 82,060
Income per common and common
equivalent share:
Income before effect of a change
in accounting for postemployment
benefits . . . . . . . . . . . . . . . . $ .58 $ .52
Effect of a change in accounting
for postemployment benefits. . . . . . . (.75) -
Net (loss) income. . . . . . . . . . . . . $ (.17) $ .52
Average common and common equivalent
shares outstanding . . . . . . . . . . . . . 159,669,700 158,899,837
Dividends declared per share of
common stock . . . . . . . . . . . . . . . . $ .26 $ .225
Ratio of earnings to fixed charges . . . . . . 3.63 3.19
</TABLE>
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 4 of 15
Pitney Bowes Inc.
Consolidated Balance Sheet
(Unaudited)
<TABLE>
(Dollars in thousands) March 31, December 31,
<CAPTION> 1994 1993
<S> <C> <C>
Assets
Current assets:
Cash and cash equivalents. . . . . . . . . . . . $ 96,066 $ 54,653
Short-term investments, at cost which
approximates market. . . . . . . . . . . . . . 1,271 1,153
Accounts receivable, less allowances:
3/94, $16,889; 12/93, $16,691. . . . . . . . . 409,973 411,810
Finance receivables, less allowances:
3/94, $36,073; 12/93, $39,488. . . . . . . . . 956,314 994,998
Inventories (Note 2) . . . . . . . . . . . . . . 411,843 394,744
Other current assets and prepayments . . . . . . 79,890 79,391
Total current assets . . . . . . . . . . . . . 1,955,357 1,936,749
Property, plant and equipment, net (Note 3). . . . 551,469 555,038
Rental equipment and related
inventories, net (Note 3). . . . . . . . . . . . 647,086 641,588
Property leased under capital
leases, net (Note 3) . . . . . . . . . . . . . . 13,779 15,451
Long-term finance receivables, less allowances:
3/94, $81,466; 12/93, $77,024. . . . . . . . . . 2,824,356 2,895,952
Goodwill, net of amortization:
3/94, $35,626; 12/93, $33,640. . . . . . . . . . 230,013 231,309
Other assets . . . . . . . . . . . . . . . . . . . 521,154 517,729
Total assets . . . . . . . . . . . . . . . . . . . $6,743,214 $6,793,816
Liabilities and stockholders' equity
Current liabilities:
Accounts payable and
accrued liabilities (Note 4) . . . . . . . . . $ 639,245 $ 675,559
Income taxes payable . . . . . . . . . . . . . . 254,687 200,110
Notes payable and current portion of
long-term obligations (Note 4) . . . . . . . . 1,884,958 2,081,872
Advance billings . . . . . . . . . . . . . . . . 328,682 315,840
Total current liabilities. . . . . . . . . . . 3,107,572 3,273,381
Deferred taxes on income . . . . . . . . . . . . . 315,614 409,660
Long-term debt . . . . . . . . . . . . . . . . . . 945,609 847,316
Other noncurrent liabilities (Note 5). . . . . . . 575,884 391,864
Total liabilities. . . . . . . . . . . . . . . 4,944,679 4,922,221
Stockholders' equity:
Cumulative preferred stock, $50 par
value, 4% convertible. . . . . . . . . . . . . 68 68
Cumulative preference stock, no par
value, $2.12 convertible . . . . . . . . . . . 2,910 2,969
Common stock, $2 par value . . . . . . . . . . . 323,338 323,338
Capital in excess of par value . . . . . . . . . 35,334 36,762
Retained earnings. . . . . . . . . . . . . . . . 1,605,319 1,674,168
Cumulative translation adjustments . . . . . . . (49,540) (47,319)
Treasury stock, at cost. . . . . . . . . . . . . (118,894) (118,391)
Total stockholders' equity . . . . . . . . . . 1,798,535 1,871,595
Total liabilities and stockholders' equity . . . . $6,743,214 $6,793,816
</TABLE>
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 5 of 15
Pitney Bowes Inc.
Consolidated Statement of Cash Flows
(Unaudited)
<TABLE>
(Dollars in thousands)
<CAPTION> Three Months Ended March 31,
1994 1993
<S> <C> <C>
Cash flows from operating activities:
Net (loss) income. . . . . . . . . . . . . . . $ (27,670) $ 82,060
Effect of a change in accounting for
postemployment benefits. . . . . . . . . . . 119,532 -
Adjustments to reconcile net (loss) income to
net cash provided by operating activities:
Depreciation and amortization. . . . . . . 70,477 64,099
Nonrecurring charges, net. . . . . . . . . (344) (1,061)
(Decrease) increase in deferred taxes
on income. . . . . . . . . . . . . . . . (18,850) 15,055
Change in assets and liabilities:
Accounts receivable. . . . . . . . . . . 1,675 2,315
Sales-type lease receivables . . . . . . (11,899) 2,490
Inventories. . . . . . . . . . . . . . . (17,444) (16,729)
Other current assets and prepayments . . 746 (13,714)
Accounts payable and accrued
liabilities. . . . . . . . . . . . . . (50,911) (50,289)
Income taxes payable . . . . . . . . . . 60,672 (9,757)
Advance billings . . . . . . . . . . . . 12,986 5,340
Other, net . . . . . . . . . . . . . . . . (7,586) (2,948)
Net cash provided by operating
activities . . . . . . . . . . . . . . 131,384 76,861
Cash flows from investing activities:
Short-term investments . . . . . . . . . . . . (22) (4,034)
Net investment in fixed assets . . . . . . . . (68,562) (59,230)
Net investment in direct-finance lease
receivables. . . . . . . . . . . . . . . . . 118,721 43,133
Investment in leveraged leases . . . . . . . . 951 5,254
Net cash provided by (used in)
investing activities . . . . . . . . . 51,088 (14,877)
Cash flows from financing activities:
(Decrease) increase in notes payable . . . . . (276,578) 161,072
Proceeds from long-term obligations. . . . . . 200,000 -
Principal payments on long-term obligations. . (19,838) (185,111)
Proceeds from issuance of stock. . . . . . . . 2,020 1,689
Stock repurchases. . . . . . . . . . . . . . . (5,447) (5,144)
Dividends paid . . . . . . . . . . . . . . . . (41,179) (35,414)
Net cash used in financing activities. . (141,022) (62,908)
Effect of exchange rate changes on cash. . . . . (37) (1,509)
Increase (decrease) in cash and cash
equivalents. . . . . . . . . . . . . . . . . . 41,413 (2,433)
Cash and cash equivalents at beginning
of period. . . . . . . . . . . . . . . . . . . 54,653 71,016
Cash and cash equivalents at end of period . . . $ 96,066 $ 68,583
Interest paid. . . . . . . . . . . . . . . . . . $ 46,486 $ 62,365
Income taxes paid. . . . . . . . . . . . . . . . $ 11,795 $ 38,333
</TABLE>
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 6 of 15
Pitney Bowes Inc.
Notes to Consolidated Financial Statements
Note 1:
The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions to Form 10-Q and do not
include all the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion
of Pitney Bowes Inc. (the Company), all adjustments (consisting of only
normal recurring adjustments) necessary to present fairly the financial
position of the Company as of March 31, 1994 and the results of its
operations and cash flows for the three months ended March 31, 1994 and
1993 have been included. Operating results for the three months ended
March 31, 1994 are not necessarily indicative of the results that may
be expected for the year ending December 31, 1994. These statements
should be read in conjunction with the financial statements and notes
thereto included in the Company's Annual Report to Stockholders and Form
10-K Annual Report for the year ended December 31, 1993.
Note 2:
<TABLE>
Inventories are comprised of the following:
<CAPTION>
(Dollars in thousands) March 31, December 31,
1994 1993
<S> <C> <C>
Raw materials and work in process. . . . . . . $ 101,686 $ 98,647
Supplies and service parts . . . . . . . . . . 102,744 98,773
Finished products. . . . . . . . . . . . . . . 207,413 197,324
Total. . . . . . . . . . . . . . . . . . . . . $ 411,843 $ 394,744
</TABLE>
Note 3:
<TABLE>
Fixed assets are comprised of the following:
<CAPTION>
(Dollars in thousands) March 31, December 31,
1994 1993
<S> <C> <C>
Property, plant and equipment. . . . . . . . . . $1,149,994 $1,136,849
Accumulated depreciation . . . . . . . . . . . . (598,525) (581,811)
Property, plant and equipment, net . . . . . . . $ 551,469 $ 555,038
Rental equipment and related
inventories. . . . . . . . . . . . . . . . . . $1,424,846 $1,426,395
Accumulated depreciation . . . . . . . . . . . . (777,760) (784,807)
Rental equipment and related
inventories, net . . . . . . . . . . . . . . . $ 647,086 $ 641,588
Property leased under capital
leases . . . . . . . . . . . . . . . . . . . . $ 46,207 $ 48,792
Accumulated amortization . . . . . . . . . . . . (32,428) (33,341)
Property leased under capital
leases, net. . . . . . . . . . . . . . . . . . $ 13,779 $ 15,451
</TABLE>
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 7 of 15
Note 4:
<TABLE>
Current liabilities include the following:
<CAPTION>
(Dollars in thousands) March 31, December 31,
1994 1993
<S> <C> <C>
Accounts payable and accrued liabilities:
Accounts payable - trade . . . . . . . . . . $ 136,970 $ 187,480
Accrued salaries, wages
and commissions. . . . . . . . . . . . . . 68,890 94,092
Accrued pension benefits . . . . . . . . . . 92,515 80,898
Miscellaneous accounts payable
and accrued liabilities. . . . . . . . . . 340,870 313,089
Total. . . . . . . . . . . . . . . . . . . . $ 639,245 $ 675,559
Notes payable and current portion
of long-term obligations:
Notes payable and overdrafts . . . . . . . $1,723,577 $2,000,364
Current portion of long-term debt. . . . . 158,875 78,222
Current portion of capital lease
obligations. . . . . . . . . . . . . . . 2,506 3,286
Total. . . . . . . . . . . . . . . . . . . $1,884,958 $2,081,872
</TABLE>
Note 5:
<TABLE>
Other noncurrent liabilities include
the following:
<CAPTION> March 31, December 31,
(Dollars in thousands) 1994 1993
<S> <C> <C>
Accrued nonpension postretirement
benefits . . . . . . . . . . . . . . . . . . $ 361,245 $ 362,402
Accrued postemployment benefits. . . . . . . . 186,823 -
Long-term capital lease obligations. . . . . . 27,816 29,462
Total. . . . . . . . . . . . . . . . . . . . . $ 575,884 $ 391,864
</TABLE>
Note 6:
The Company adopted Statement of Financial Accounting Standards No. 112,
"Employers' Accounting for Postemployment Benefits" (FAS 112) as of
January 1, 1994. FAS 112 requires that postemployment benefits be
recognized on the accrual basis of accounting for fiscal years beginning
after December 15, 1993. Postemployment benefits include primarily
Company provided medical benefits to disabled employees and Company
provided life insurance as well as other disability- and death-related
benefits to former or inactive employees, their beneficiaries and
covered dependents.
The one-time effect of adopting FAS 112 was a non-cash, after-tax charge
of $119.5 million (net of approximately $80.5 million of income taxes),
or 75 cents per share. Application of this new standard had no
significant effect on the Company's 1994 first quarter expense.
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 8 of 15
Pitney Bowes Inc.
Management's Discussion and Analysis of Financial
Condition and Results of Operations
Results of Operations - first quarter 1994 vs. first quarter 1993
Revenue increased five percent to $876.8 million in 1994 while income
before the one-time effect of a change in accounting increased 12
percent to $91.9 million. The first quarter revenue increase included
five percent from growth in volume and one percent from price increases
offset, in part, by a one percent unfavorable foreign currency exchange
rate impact. The current year period reflects the impact of adopting
Statement of Financial Accounting Standards No. 112, "Employers'
Accounting for Postemployment Benefits" (FAS 112) as of January 1, 1994.
FAS 112 requires that postemployment benefit costs be recognized on the
accrual basis of accounting for fiscal years beginning after December
15, 1993. Postemployment benefits include primarily Company provided
medical benefits to disabled employees and Company provided life
insurance as well as other disability- and death-related benefits to
former or inactive employees, their beneficiaries and covered
dependents. The one-time effect of adopting FAS 112 was a non-cash,
after-tax charge of $119.5 million, or 75 cents per share.
Sales revenue increased ten percent in 1994 primarily due to the
acquisition of Ameriscribe Corporation, a nationwide provider of on-site
reprographics, mailroom and other office services, in the fourth quarter
of 1993. The sales revenue growth of the business equipment segment was
impacted by higher 1993 PROM, disk and scale chart revenue. Sales
revenue of the business supplies and services segment increased
significantly reflecting the growth of the facilities management
business offset, in part, by lower placements of marking systems
products.
Rentals and financing revenue, substantially all of which is in the
business equipment and financial services segments, increased two
percent reflecting higher numbers of postage meters, especially higher-
yielding Postage By Phone(R) and electronic meters, facsimile and copier
machines in service as well as price increases. Financing revenue
decreased primarily due to the Company's decision early last year to
phase out the business of financing non-Pitney Bowes equipment outside
of the United States.
Since the first quarter of 1993, the Company has continued to phase out
the business of financing non-Pitney Bowes equipment outside the U.S.
The Company is continuing an inquiry and evaluation of the conduct by
former management personnel of its German leasing business. The results
of this inquiry to date indicate that former management caused the
Company's German leasing operation to enter into transactions which were
not consistent with company policy and guidelines and, in certain cases,
lacked appropriate documentation and collateral. Additionally, in
certain instances, the Company is continuing to locate, repossess and
remarket collateral where possible. At the current time, the Company
believes that sufficient reserves for expected losses are in place. As
the Company's inquiry continues it may determine that additional loss
provisions are necessary. If such additional loss provisions are
required, it is anticipated that the resulting charges against income
would be offset by gains on asset sales by the financial services
segment. The Company expects to complete its inquiry by the end of the
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 9 of 15
second quarter of 1994. The Company's management believes there are
sufficient opportunities for profitable growth in its domestic external
financing business and plans to make future external investments solely
in the U.S. market.
Support services revenue, most of which is derived from the business
equipment segment, was slightly above the prior year reflecting the
expansion of the dictation, facsimile and U.S. mailing service bases
mostly offset by unfavorable foreign currency exchange rate impacts.
The cost of sales to sales revenue ratio increased to 55.8 percent in
1994 from 54.7 percent in 1993 primarily due to the increased
significance of the Company's facilities management business which
includes most of its expenses in cost of sales. In addition, 1993
benefitted from a greater volume of high-margin PROM, disk and scale
chart sales. The cost of rentals and financing to rentals and financing
revenue ratio improved to 31.2 percent in 1994 from 31.3 percent in 1993
reflecting a lower mix of revenue from the financial services segment.
Selling, service and administrative expenses were 37.5 percent of
revenue in 1994 compared with 38.3 percent in 1993. This improvement
reflects the increased significance of the Company's facilities
management business which includes most of its expenses in cost of sales
and cost containment programs throughout the Company.
Research and development expenses decreased nine percent to $23.7
million in 1994 from $26.0 million in 1993. This decline reflects the
Company's cost reduction efforts and higher engineering support for
recently introduced products. These costs reflect continued investment
in advanced product development focusing on electronic technology and
software development.
Net interest expense decreased 15 percent to $41.5 million in 1994 from
$48.8 million in 1993 due to lower borrowing costs and average borrowing
levels. This favorable comparison is not expected to continue
throughout the remainder of 1994 due to the increasing short-term
interest rate environment.
The first quarter 1994 effective tax rate was 37.4 percent compared with
37.1 percent in the first quarter of 1993 principally due to a higher
U.S. statutory rate partly offset by the tax impact of a partnership
lease transaction.
Liquidity and Capital Resources
The current ratio reflects the Company's practice of utilizing a
balanced mix of debt maturities to fund finance assets. At March 31,
1994, this ratio was .63 to 1 compared to .59 to 1 at year-end 1993.
The increased ratio was primarily due to the issuance by Pitney Bowes
Credit Corporation (PBCC) of $200 million of 5.625 percent notes due in
February 1997 which funded the repayment of commercial paper borrowings
partly offset by the reclassification of PBCC's $100 million of 10.65
percent notes due in April 1999 to current portion of long-term debt.
In the first quarter of 1994, PBCC exercised the option to redeem its
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 10 of 15
10.65 percent notes on April 1, 1994. The Company continues to use a
balanced mix of debt maturities, variable- and fixed-rate debt and
interest swaps to control the sensitivity to interest rate volatility.
As part of the Company's non-financial services shelf registrations, a
medium-term note facility was established permitting issuance of up to
$100 million in debt securities with maturities ranging from more than
one year up to 30 years of which $32 million remained available at March
31, 1994. The Company also has an additional $300 million remaining on
shelf registrations filed with the Securities and Exchange Commission.
PBCC has $400 million available from a $500 million shelf registration
statement with the Securities and Exchange Commission. This
registration statement should meet PBCC's long-term financing needs for
the next two years. In March 1994, PBCC issued $200 million of 5.625
percent notes due in February 1997. In April 1994, PBCC redeemed $100
million of 10.65 percent notes due in April 1999. PBCC had previously
sold an option on a notional principal amount of $100 million to enable
a counterparty to require PBCC to pay a fixed rate of 10.67 percent for
five years starting April 1, 1994. The counterparty has exercised that
option.
In January 1994, the Company sold approximately $88 million of finance
assets in a privately-placed transaction with a third-party investor.
Proceeds from the sale of these finance assets were used to repay a
portion of the Company's commercial paper borrowings. This transaction
had no material effect on the Company's results.
The ratio of total debt to total debt and stockholders' equity was 61.4
percent at March 31, 1994 compared to 61.3 percent at year-end 1993.
This ratio was unfavorably impacted by the Company's first quarter 1994
adoption of FAS 112, as required, which resulted in a one-time, after-
tax charge of $119.5 million and the repurchase of $5.4 million of
common stock partly offset by the reduction in overall borrowing levels.
Book value per common share decreased to $11.35 at March 31, 1994 from
$11.81 at year-end 1993 principally due to the first quarter 1994
adoption of FAS 112.
During the period May 1 to May 12, 1994 the Company repurchased
approximately 846,000 shares of common stock at a total cost of $32.1
million. It is anticipated that the repurchased shares will be used for
issuances under the Company's stock and dividend reinvestment plans,
conversion requirements and other corporate purposes.
Capital investments
In the first three months of 1994, net investments in fixed assets
included $20.9 million in net additions to property, plant and equipment
and $45.3 million in net additions to rental equipment and related
inventories compared with $19.1 and $39.7 million, respectively, in the
same period in 1993. These additions included expenditures for normal
plant and manufacturing equipment. In the case of rental equipment, the
additions included the production of postage meters and the purchase of
facsimile equipment for both new placement and upgrade programs.
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 11 of 15
At March 31, 1994, commitments for the acquisition of property, plant
and equipment included plant and manufacturing equipment improvements
as well as rental equipment for new and replacement programs. The
Company is also building a new facility to house its Shipping and
Weighing Division in Shelton, Connecticut, which is expected to be
completed in 1995.
As previously reported, the Company's financial services segment has
made senior secured loans and commitments in connection with
acquisition, leveraged buyout and recapitalization financings. At March
31, 1994, the Company had a total of $2.5 million of such senior secured
loans and commitments outstanding compared to $13.9 million at December
31, 1993. In March 1994, the Company sold $11.3 million of its senior
secured loan and commitment with a Company that had previously filed
under Chapter 11 of the Federal Bankruptcy Code and recovered 100
percent of its carrying value. The Company has not participated in
unsecured or subordinated debt financing in any highly leveraged
transactions.
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 12 of 15
Part II - Other Information
Item 6: Exhibits and Reports on Form 8-K.
(a) Exhibits (numbered in accordance with Item 601 of Regulation S-K)
Reg. S-K Status or Incorporation
Exhibits Description by Reference
(11) Computation of earnings See Exhibit (i)
per share. on page 14.
(12) Computation of ratio of See Exhibit (ii)
earnings to fixed charges. on page 15.
(b) Reports on Form 8-K.
No reports on Form 8-K were filed for the three months ended
March 31, 1994.
<PAGE>
Pitney Bowes Inc. - Form 10-Q
Three Months Ended March 31, 1994
Page 13 of 15
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PITNEY BOWES INC.
May 13, 1994
/s/ C. F. Adimando
C. F. Adimando
Vice President - Finance and
Administration, and Treasurer
(Principal Financial Officer)
/s/ S. J. Green
S. J. Green
Vice President - Controller
(Principal Accounting Officer)
<PAGE>
<TABLE>
Pitney Bowes Inc. - Form 10-Q Exhibit (i)
Three Months Ended March 31, 1994
Page 14 of 15
Pitney Bowes Inc.
Computation of Earnings per Share
Three Months Ended March 31,
(Dollars in thousands, except per share data) 1994 1993
<CAPTION>
<S> <C> <C>
Primary
Income before effect of a change in accounting for
postemployment benefits (1). . . . . . . . . . . . . . $ 91,861 $ 82,059
Effect of accounting change. . . . . . . . . . . . . . . (119,532) -
Net (loss) income applicable to common stock . . . . . . $ (27,671) $ 82,059
Weighted average number of common shares outstanding . . 158,151,500 157,161,280
Preference stock, $2.12 cumulative convertible . . . . . 869,500 930,174
Stock option and purchase plans. . . . . . . . . . . . . 648,700 808,383
Total common and common equivalent shares outstanding. . 159,669,700 158,899,837
Income per common and common equivalent share -
primary:
Income before effect of a change in accounting for
postemployment benefits. . . . . . . . . . . . . . $ .58 $ .52
Effect of accounting change. . . . . . . . . . . . . (.75) -
Net (loss) income. . . . . . . . . . . . . . . . . . $ (.17) $ .52
Fully Diluted
Income before effect of a change in accounting for
postemployment benefits. . . . . . . . . . . . . . . . $ 91,862 $ 82,060
Effect of accounting change. . . . . . . . . . . . . . . (119,532) -
Net (loss) income applicable to common stock . . . . . . $ (27,670) $ 82,060
Weighted average number of common shares outstanding . . 158,151,500 157,161,280
Preference stock, $2.12 cumulative convertible . . . . . 869,500 930,174
Stock option and purchase plans. . . . . . . . . . . . . 676,275 815,616
Preferred stock, 4% cumulative convertible . . . . . . . 16,568 25,949
Total common and common equivalent shares outstanding. . 159,713,843 158,933,019
Income per common and common equivalent share -
fully diluted:
Income before effect of a change in accounting for
postemployment benefits. . . . . . . . . . . . . . $ .58 $ .52
Effect of accounting change. . . . . . . . . . . . . (.75) -
Net (loss) income. . . . . . . . . . . . . . . . . . $ (.17) $ .52
<FN>
(1) Income before effect of a change in accounting for postemployment benefits was
adjusted for preferred dividends.
</TABLE>
<PAGE>
<TABLE>
Pitney Bowes Inc. - Form 10-Q Exhibit (ii)
Three Months Ended March 31, 1994
Page 15 of 15
Pitney Bowes Inc.
Computation of Ratio of Earnings to Fixed Charges (1)
(Dollars in thousands)
<CAPTION> Three Months Ended March 31,
1994 1993
<S> <C> <C>
Income before income taxes . . . . . . . . $146,858 $130,379
Add:
Interest expense . . . . . . . . . . . . 43,734 50,226
Portion of rents
representative of the
interest factor. . . . . . . . . . . . 12,154 9,415
Amortization of capitalized
interest . . . . . . . . . . . . . . . 232 232
Income as adjusted . . . . . . . . . . . . $202,978 $190,252
Fixed charges:
Interest expense . . . . . . . . . . . . $ 43,734 $ 50,226
Capitalized interest . . . . . . . . . . 62 -
Portion of rents
representative of the
interest factor. . . . . . . . . . . . 12,154 9,415
$ 55,950 $ 59,641
Ratio of earnings to fixed
charges. . . . . . . . . . . . . . . . . 3.63 3.19
<FN>
(1) The computation of the ratio of earnings to fixed charges has been
computed by dividing income before income taxes and fixed charges by
fixed charges. Included in fixed charges is one-third of rental
expense as the representative portion of interest.
</TABLE>
