01 - Document and Entity Inform
01 - Document and Entity Information (USD $) | |
12 Months Ended
Dec. 31, 2007 | |
Entity Information [Line Items] | |
Entity Registrant Name | PITNEY BOWES INC. |
Entity Central Index Key | 0000078814 |
Document Type | FORM 10-K |
Document Period End Date | 2007-12-31 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | Yes |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Public Float | $10,295,378,321 |
Entity Common Stock, Shares Outstanding | 211,088,288 |
02 - Consolidated Statement of
02 - Consolidated Statement of Income (USD $) | |||
In Thousands | 12 Months Ended
Dec. 31, 2007 | 12 Months Ended
Dec. 31, 2006 | 12 Months Ended
Dec. 31, 2005 |
Revenue: | |||
Equipment sales | $1,335,538 | $1,372,566 | $1,251,026 |
Supplies | 393,478 | 339,594 | 297,151 |
Software | 346,020 | 202,415 | 174,085 |
Rentals | 739,130 | 785,068 | 801,285 |
Financing | 790,121 | 725,131 | 663,484 |
Support services | 760,915 | 716,556 | 697,796 |
Business services | 1,764,593 | 1,588,688 | 1,482,109 |
Total revenue | 6,129,795 | 5,730,018 | 5,366,936 |
Cost and expenses: | |||
Cost of equipment sales | 696,900 | 693,535 | 625,235 |
Cost of supplies | 106,702 | 90,035 | 73,330 |
Cost of software | 82,097 | 42,951 | 36,945 |
Cost of rentals | 171,191 | 171,491 | 165,963 |
Cost of support services | 433,324 | 400,089 | 385,547 |
Cost of business services | 1,380,541 | 1,242,226 | 1,195,761 |
Selling, general and administrative | 1,907,160 | 1,764,260 | 1,655,210 |
Research and development | 185,665 | 165,368 | 165,751 |
Restructuring charges and asset impairments | 264,013 | 35,999 | 53,650 |
Interest expense | 250,540 | 228,418 | 193,174 |
Interest income [N] | (8,669) | (15,822) | (5,298) |
Other (income) expense [N] | (380) | (3,022) | 10,000 |
Total costs and expenses | 5,469,084 | 4,815,528 | 4,555,268 |
Income from continuing operations before income taxes and minority interest | 660,711 | 914,490 | 811,668 |
Provision for income taxes | 280,222 | 335,004 | 328,597 |
Minority interest (preferred stock dividends of subsidiaries) | 19,242 | 13,827 | 9,828 |
Income from continuing operations | 361,247 | 565,659 | 473,243 |
Income (loss) from discontinued operations, net of income tax | 5,534 | (460,312) | 35,368 |
Net income | $366,781 | $105,347 | $508,611 |
Basic earnings per share of common stock: | |||
Continuing operations | 1.65 | 2.54 | 2.07 |
Discontinued operations | 0.03 | -2.07 | 0.15 |
Net income | 1.68 | 0.47 | 2.22 |
Diluted earnings per share of common stock: | |||
Continuing operations | 1.63 | 2.51 | 2.04 |
Discontinued operations | 0.03 | -2.04 | 0.15 |
Net income | 1.66 | 0.47 | 2.19 |
03 - Consolidated Balance Sheet
03 - Consolidated Balance Sheet (USD $) | ||
In Thousands | Dec. 31, 2007
| Dec. 31, 2006
|
Current assets: | ||
Cash and cash equivalents | $377,176 | $239,102 |
Short-term investments | 63,279 | 62,512 |
Accounts receivable | ||
Accounts receivable, gross, current | 890,396 | 794,125 |
Allowance for doubtful accounts receivable, current [N] | (49,324) | (50,052) |
Accounts receivable, net, current | 841,072 | 744,073 |
Finance receivables | ||
Finance receivables, gross, current | 1,544,345 | 1,449,713 |
Allowance for credit losses, current [N] | (45,859) | (45,643) |
Finance receivables, net, current | 1,498,486 | 1,404,070 |
Inventories | 197,962 | 237,817 |
Current income taxes | 83,227 | 54,785 |
Other current assets and prepayments | 258,411 | 231,096 |
Total current assets | 3,319,613 | 2,973,455 |
Property, plant and equipment, net | 627,918 | 612,640 |
Rental property and equipment, net | 435,927 | 503,911 |
Long-term finance receivables | ||
Finance receivables, gross, noncurrent | 1,566,285 | 1,567,009 |
Allowance for credit losses, noncurrent [N] | (32,512) | (36,856) |
Finance receivables, net, noncurrent | 1,533,773 | 1,530,153 |
Investment in leveraged leases | 249,191 | 215,371 |
Goodwill | 2,299,858 | 1,791,157 |
Intangible assets, net | 457,188 | 365,192 |
Non-current income taxes | 28,098 | 73,739 |
Other assets | 598,377 | 543,326 |
Total assets | 9,549,943 | 8,608,944 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 1,965,567 | 1,677,501 |
Current income taxes | 96,851 | 142,835 |
Notes payable and current portion of long-term obligations | 953,767 | 490,540 |
Advance billings | 540,254 | 465,862 |
Total current liabilities | 3,556,439 | 2,776,738 |
Deferred taxes on income | 472,240 | 454,929 |
FIN 48 uncertainties and other income tax liabilities | 285,505 | 0 |
Long-term debt | 3,802,075 | 3,847,617 |
Other non-current liabilities | 406,216 | 446,306 |
Total liabilities | 8,522,475 | 7,525,590 |
Preferred stockholders' equity in subsidiaries | 384,165 | 384,165 |
Commitments and contingencies (see Note 15) | 0 | 0 |
Stockholders' equity: | ||
Cumulative preferred stock | 7 | 7 |
Cumulative preference stock | 1,003 | 1,068 |
Common stock | 323,338 | 323,338 |
Additional paid in capital | 252,185 | 235,558 |
Retained earnings | 4,133,756 | 4,140,128 |
Accumulated other comprehensive income (loss) | 88,656 | (131,744) |
Treasury stock, at cost [N] | (4,155,642) | (3,869,166) |
Total stockholders' equity | 643,303 | 699,189 |
Total liabilities and stockholders' equity | $9,549,943 | $8,608,944 |
04 - Consolidated Balance Sheet
04 - Consolidated Balance Sheet (Parenthetical) (USD $) | ||
12 Months Ended
Dec. 31, 2007 | Dec. 31, 2006
| |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock par value | 50 | |
Preferred stock conversion percentage | 4 percent | |
Preference stock par value | no par value | |
Preference stock conversion dollar value | 2.12 | |
Common stock, par value | 1 | |
Common stock, shares authorized | 480,000,000 | |
Common stock, shares issued | 323,337,912 | |
Treasury stock, shares | 108,822,953 | 102,724,590 |
05 - Consolidated Statements of
05 - Consolidated Statements of Cash Flows (USD $) | |||
In Thousands | 12 Months Ended
Dec. 31, 2007 | 12 Months Ended
Dec. 31, 2006 | 12 Months Ended
Dec. 31, 2005 |
Cash flows from operating activities: | |||
Net income | $366,781 | $105,347 | $508,611 |
Gain on sale of facility, net of tax [N] | (1,623) | 0 | 0 |
Net loss on sale of businesses, net of tax | 0 | 434,085 | 0 |
Non-cash expense from FSC tax law change | 0 | 16,209 | 0 |
Non-cash tax expense related to IRS settlement and sale of a business | 0 | 61,000 | 0 |
Tax and bond payments related to IRS settlement and sale of a business | 0 | (1,040,700) | (200,000) |
Restructuring charges and asset impairments, net of tax | 223,486 | 23,040 | 42,248 |
Restructuring payments [N] | (31,568) | (51,566) | (88,544) |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Depreciation and Amortization | 383,141 | 363,258 | 331,963 |
Stock-based compensation | 24,131 | 27,375 | 27,223 |
Pension plan contributions [N] | 0 | 0 | (76,508) |
Changes in operating assets and liabilities, excluding effects of acquisitions: | |||
(Increase) decrease in accounts receivable [N] | 35,853 | (46,623) | (87,646) |
(Increase) decrease in finance receivables [N] | (86,238) | (236,872) | (105,358) |
(Increase) decrease in inventories [N] | 7,710 | (142) | (7,835) |
(Increase) decrease in prepaid, deferred expense and other assets [N] | 906 | (11,360) | (12,114) |
Increase (decrease) in accounts payable and accrued liabilities | 32,789 | 42,231 | 3,324 |
Increase (decrease) in current and non-current income taxes | 123,636 | 52,784 | 185,628 |
Increase (decrease) in advance billings | 1,745 | (6,029) | 19,508 |
Increase (decrease) in other operating capital, net [N] | (20,284) | (18,611) | (10,059) |
Net cash provided by (used in) operting activities | 1,060,465 | (286,574) | 530,441 |
Cash flows from investing activities: | |||
Short-term and other investments [N] | 42,367 | (1,295) | (44,099) |
Proceeds from the sale of facilities | 29,608 | 0 | 30,238 |
Capital expenditures [N] | (264,656) | (327,877) | (291,550) |
Net investment in external financing [N] | (2,214) | 109,050 | 117,595 |
Proceeds from divestiture of businesses | 0 | 1,003,062 | 0 |
Advance against COLI cash surrender value [N] | 0 | 138,381 | 0 |
Acquisitions, net of cash acquired [N] | (594,110) | (230,628) | (294,176) |
Reserve account deposits [N] | 62,666 | 28,780 | 9,800 |
Net cash (used in) provided by investing activities | (726,339) | 719,473 | (472,192) |
Cash flows from financing activities: | |||
(Decrease) increase in notes payable, net | (89,673) | (26,790) | (31,150) |
Proceeds from long-term obligations | 640,765 | 493,285 | 1,050,000 |
Principal payments on long-term obligations [N] | (174,191) | (396,755) | (695,724) |
Proceeds from issuance of common stock | 107,517 | 101,449 | 92,164 |
Proceeds from issuance of preferred stock in a subsidiary | 0 | 74,165 | 0 |
Stock repurchases [N] | (399,996) | (400,000) | (258,803) |
Dividends paid [N] | (288,790) | (285,051) | (284,348) |
Net cash used in financing activities | (204,368) | (439,697) | (127,861) |
Effect of exchange rate changes on cash and cash equivalents | 8,316 | 2,391 | (3,096) |
Increase (decrease) in cash and cash equivalents | 138,074 | (4,407) | (72,708) |
Cash and cash equivalents at beginning of year | 239,102 | 243,509 | 316,217 |
Cash and cash equivalents at end of year | 377,176 | 239,102 | 243,509 |
Cash interest paid | 236,697 | 225,837 | 196,964 |
Cash income taxes paid, net | ($178,469) | $1,315,437 | $164,068 |
06 - Consolidated Statements of
06 - Consolidated Statements of Shareholders' Equity (USD $) | |||||||||
In Thousands | Preferred stock [Member]
| Preference stock [Member]
| Common stock [Member]
| Additional paid-in capital [Member]
| Comprehensive income [Member]
| Retained earnings [Member]
| Accum OCI (loss) [Member]
| Treasury stock at cost [Member]
| Total
|
Stockholders' equity, ending balance at Dec. 31, 2004 | $19 | $1,252 | $323,338 | $201,704 | $0 | $4,100,771 | $135,526 | ($3,413,458) | $1,349,152 |
Net income | 508,611 | 508,611 | 508,611 | ||||||
Other comprehensive income, net of tax: | |||||||||
Foreign currency translations | (54,499) | (54,499) | |||||||
Net unrealized gain (loss) on derivative instruments | 1,605 | 1,605 | |||||||
Minimum pension liability [N] | (5,715) | (5,715) | |||||||
Comprehensive income, net of tax | 450,002 | ||||||||
Preferred | (1) | ||||||||
Preference | (93) | ||||||||
Common | (284,254) | ||||||||
Issuances of common stock | (8,468) | (583) | 85,569 | ||||||
Conversions to common stock | (2) | (94) | (2,056) | 2,152 | |||||
Stock-based compensation | 27,223 | ||||||||
Tax effect from stock-based compensation | 4,505 | ||||||||
Repurchase of common stock | (258,803) | ||||||||
Stockholders' equity, ending balance at Dec. 31, 2005 | 17 | 1,158 | 323,338 | 222,908 | 0 | 4,324,451 | 76,917 | (3,584,540) | 1,364,249 |
Adjustment to initially apply SAB 108, net of tax | (4,618) | ||||||||
Net income | 105,347 | 105,347 | 105,347 | ||||||
Other comprehensive income, net of tax: | |||||||||
Foreign currency translations | 83,183 | 83,183 | |||||||
Net unrealized gain (loss) on derivative instruments | (20) | (20) | |||||||
Minimum pension liability [N] | 5,405 | 5,405 | |||||||
Comprehensive income, net of tax | 193,915 | ||||||||
Adjustment to initially apply SFAS 158, net of tax | (297,229) | ||||||||
Preferred | (1) | ||||||||
Preference | (86) | ||||||||
Common | (284,965) | ||||||||
Issuances of common stock | (11,575) | 113,142 | |||||||
Conversions to common stock | (10) | (90) | (2,132) | 2,232 | |||||
Stock-based compensation | 27,375 | ||||||||
Tax effect from stock-based compensation | (1,018) | ||||||||
Repurchase of common stock | (400,000) | ||||||||
Stockholders' equity, ending balance at Dec. 31, 2006 | 7 | 1,068 | 323,338 | 235,558 | 0 | 4,140,128 | (131,744) | (3,869,166) | 699,189 |
Initial adjustment for FIN 48 | (84,363) | ||||||||
Net income | 366,781 | 366,781 | 366,781 | ||||||
Other comprehensive income, net of tax: | |||||||||
Foreign currency translations | 164,728 | 164,728 | |||||||
Net unrealized gain (loss) on derivative instruments | 2,801 | 2,801 | |||||||
Net unrealized gain (loss) on investment securities | 352 | 352 | |||||||
Amortization of pension and postretirement costs | 22,172 | 22,172 | |||||||
Net unamortized gain (loss) on pension and postretirement plans | 30,347 | ||||||||
Comprehensive income, net of tax | 556,834 | ||||||||
Preference | (81) | ||||||||
Common | (288,709) | ||||||||
Issuances of common stock | (7,967) | 111,925 | |||||||
Conversions to common stock | (65) | (1,530) | 1,595 | ||||||
Stock-based compensation | 24,131 | ||||||||
Tax effect from stock-based compensation | 1,993 | ||||||||
Repurchase of common stock | (399,996) | ||||||||
Stockholders' equity, ending balance at Dec. 31, 2007 | $7 | $1,003 | $323,338 | $252,185 | $0 | $4,133,756 | $88,656 | ($4,155,642) | $643,303 |
07 - Notes to Consolidated Fina
07 - Notes to Consolidated Financial Statements | |
12 Months Ended
Dec. 31, 2007 | |
Notes to consolidated financial statements | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | 1 Description of Business and Summary of Significant Accounting Policies Description of Business We are a provider of leading-edge, global, integrated mail and document management solutions for organizations of all sizes. We operate in two business groups: Mailstream Solutions and Mailstream Services. We operate both inside and outside the United States. See Note 19 to the Consolidated Financial Statements for financial information concerning revenue, earnings before interest and taxes (EBIT) and identifiable assets, by reportable segment and geographic area. Basis of Presentation and Consolidation We have prepared the Consolidated Financial Statements of the Company in conformity with accounting principles generally accepted in the United States of America (GAAP). Operating results of acquired companies are included in the Consolidated Financial Statements from the date of acquisition. Intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of the Consolidated Financial Statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts of assets, liabilities, revenues and expenses that are reported in the Consolidated Financial Statements and accompanying disclosures, including the disclosure of contingent assets and liabilities. These estimates are based on our best knowledge of current events, historical experience, actions that we may undertake in the future, and on various other assumptions that are believed to be reasonable under the circumstances. As a result, actual results could differ from those estimates and assumptions. Reclassification Certain prior year amounts in the consolidated financial statements have been reclassified to conform to the current year presentation. |
Cash equivalents and short-term investments [Text Block] | Cash Equivalents and Short-Term Investments Cash equivalents include short-term, highly liquid investments with maturities of three months or less at the date of acquisition. We place our temporary cash and highly liquid short-term investments with a maturity of greater than three months but less than one year from the reporting date with financial institutions or investment managers and/or invest in highly rated short-term obligations. |
Receivables, Policy [Text Block] | Accounts Receivable and Allowance for Doubtful Accounts We estimate our accounts receivable risks and provide allowances for doubtful accounts accordingly. We believe that our credit risk for accounts receivable is limited because of our large number of customers and the relatively small account balances for most of our customers. Also, our customers are dispersed across different business and geographic areas. We evaluate the adequacy of the allowance for doubtful accounts on a periodic basis. The evaluation includes historical loss experience, length of time receivables are past due, adverse situations that may affect a customers ability to repay and prevailing economic conditions. We make adjustments to our allowance if the evaluation of allowance requirements differs from the actual aggregate reserve. This evaluation is inherently subjective and estimates may be revised as more information becomes available. Finance Receivables and Allowance for Credit Losses We estimate our finance receivables risks and provide allowances for credit losses accordingly. Our financial services businesses establish credit approval limits based on the credit quality of the customer and the type of equipment financed. We charge finance receivables through the allowance for credit losses after collection efforts are exhausted and we deem the account uncollectible. Our financial services businesses base credit decisions primarily on a customers financial strength and we may also consider collateral values. We believe that our concentration of credit risk for finance receivables in our internal financing division is limited because of our large number of customers, small account balances and customer geographic and industry diversification. Our general policy for finance receivables contractually past due for over 120 days is to discontinue revenue recognition. We resume revenue recognition when payments reduce the account to 60 days or less past due. We evaluate the adequacy of allowance for credit losses on a periodic basis. Our evaluation includes historical loss experience, the nature and volume of its portfolios, adverse situations that may affect a customers ability to repay, and prevailing economic conditions. We make adjustments to our allowance for credit losses if the evaluation of reserve requirements differs from the actual aggregate reserve. This evaluation is inherently subjective and estimates may be revised as more information becomes available. |
Inventory, Policy [Text Block] | Inventories Inventories are stated at the lower of cost or market. Cost is determined on the last-in, first-out (LIFO) basis for most U.S. inventories, and on the first-in, first-out (FIFO) basis for most non-U.S. inventories. |
Other Current Assets And Pre-payments Disclosure [TextBlock] | Other Current Assets and Prepayments Other current assets and prepayments include primarily postage meter receivables billed in advance and costs paid in advance. |
Property, Plant and Equipment, Policy [Text Block] | Fixed Assets and Depreciation Property, plant and equipment and rental equipment are stated at cost and depreciated principally using the straight-line method over their estimated useful lives. The estimated useful lives of depreciable fixed assets are as follows: buildings, up to 50 years; plant and equipment, 3 to 15 years; and computer equipment, 3 to 5 years. Major improvements which add to productive capacity or extend the life of an asset are capitalized while repairs and maintenance are charged to expense as incurred. Leasehold improvements are amortized over the shorter of the estimated useful life or their related lease term. Fully depreciated assets are retained in fixed assets and accumulated depreciation until they are removed from service. In the case of disposals, assets and related accumulated depreciation are removed from the accounts, and the net amounts, less proceeds from disposal, are included in income. |
Research, Development, and Computer Software, Policy [Text Block] | Capitalized Software Development Costs We capitalize certain costs of software developed for internal use in accordance with Statement of Position No. 98-1, Accounting for the Costs of Computer Software Developed or Obtained for Internal Use. Capitalized costs include purchased materials and services, payroll and payroll-related costs and interest costs. The cost of internally developed software is amortized on a straight-line basis over its estimated useful life, principally 3 to 10 years. We capitalize software development costs related to software to be sold, leased, or otherwise marketed in accordance with Statement of Financial Accounting Standards (SFAS) No. 86, Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed. Software development costs are expensed as incurred until technological feasibility has been established, at which time such costs are capitalized until the product is available for general release to the public. Capitalized software development costs include purchased materials and services, payroll and payroll-related costs attributable to programmers, software engineers, quality control and field certifiers, and interest costs. Capitalized software development costs are amortized over the estimated product useful life, principally 3 to 5 years, using the greater of the straight-line method or the ratio of current product revenues to total projected future revenues. Other assets on our Consolidated Balance Sheets include $21.6 million and $14.8 million of capitalized software development costs at December 31, 2007 and 2006, respectively. The Consolidated Statements of Income include the related amortization expense of $3.9 million, $1.6 million, and $1.4 million for the years ended December 31, 2007, 2006, and 2005, respectively. Total software development costs capitalized in 2007 and 2006 were $10.1 million and $8.5 million, respectively. Research and Development Costs Research and product development costs not subject to SFAS 86 are expensed as incurred. These costs primarily include personnel related costs. |
Business Combinations Disclosure [Text Block] | Business Combinations We account for business combinations using the purchase method of accounting which requires that the assets acquired and liabilities assumed be recorded at the date of acquisition at their respective fair values. Goodwill represents the excess of the purchase price over the estimated fair values of net tangible and intangible assets acquired in business combinations. Goodwill is tested for impairment on an annual basis or as circumstances warrant. We estimate the fair value of intangible assets primarily using a cost, market and income approach. Intangible assets with finite lives acquired under business combinations are amortized over their estimated useful lives, principally 3 to 15 years. Customer relationship intangibles are generally amortized using an accelerated attrition method. All other intangibles are amortized on a straight-line method. See Note 6 to the Consolidated Financial Statements. |
Impairment or Disposal of Long-Lived Assets, Policy [Text Block] | Impairment Review for Long Lived Assets Long-lived assets are reviewed for impairment on an annual basis or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. If such a change in circumstances occurs, the related estimated future undiscounted cash flows expected to result from the use of the asset and its eventual disposition are compared to the carrying amount. If the sum of the expected cash flows is less than the carrying amount, we record an impairment charge. The impairment charge is measured as the amount by which the carrying amount exceeds the fair value of the asset. The fair values of impaired long-lived assets are determined using probability weighted expected cash flow estimates, quoted market prices when available and appraisals as appropriate in accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. See Note 14 to the Consolidated Financial Statements for further details. |
Compensation Related Costs, Policy [Text Block] | Retirement Plans In accordance with SFAS No. 87, Employers Accounting for Pensions, and SFAS No. 106, Employers Accounting for Postretirement Benefits Other Than Pensions, actual results that differ from our assumptions and estimates are accumulated and amortized over the estimated future working life of the plan participants and will therefore affect pension expense recognized in future periods. Net pension expense is based primarily on current service costs, interest costs and the returns on plan assets. In accordance with this approach, differences between the actual and expected return on plan assets are recognized over a five-year period. In accordance with SFAS No. 158, Employers Accounting for Defined Pension and Other Post Retirement Plans an amendment to FASB Statements No. 87, 88, 106 and 132(R), we recognize the overfunded or underfunded status of pension and other postretirement benefit plans on the balance sheet. Under SFAS 158, gains and losses, prior service costs and credits, and any remaining transition amounts under SFAS 87 and SFAS 106 that have not yet been recognized in net periodic benefit costs are recognized in accumulated other comprehensive income, net of tax, until they are amortized as a component of net periodic benefit cost. We use a measurement date of December 31 for all of our retirement plans. See Note 13 to the Consolidated Financial Statements for further details. Stock-based Compensation Effective January 1, 2006, we adopted the provisions of SFAS No. 123(R), Share-Based Payment (FAS 123R). We previously applied Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees, and related Interpretations and provided the required pro forma disclosures of SFAS No. 123, Accounting for Stock-Based Compensation. We elected to adopt the modified retrospective application method provided by FAS 123(R) and accordingly, financial statement amounts for the periods presented herein reflect results as if the fair value method of expensing had been applied from the original effective date of FAS 123. Stock-based compensation represents the cost related to stock-based awards granted to employees. We measure stock-based compensation cost at grant date, based on the estimated fair value of the award, and recognize the cost as expense on a straight-line basis (net of estimated forfeitures) over the employee requisite service period. We estimate the fair value of stock options using a Black-Scholes valuation model. The expense is recorded in costs; selling, general and administrative expense; and research and development expense in the Consolidated Statements of Income based on the employees respective functions. We record deferred tax assets for awards that result in deductions on our income tax returns, based on the amount of compensation cost recognized and our statutory tax rate in the jurisdiction in which we will receive a deduction. Differences between the deferred tax assets recognized for financial reporting purposes and the actual tax deduction reported in our income tax return are recorded in capital in excess of par value (if the tax deduction exceeds the deferred tax asset or |
Revenue Recognition, Policy [Text Block] | Revenue Recognition We derive our revenue from the following sources: equipment sales; supplies; software; rentals; financing; support services; and business services. In accordance with GAAP, the Company recognizes revenue from these sources as follows: Sales Revenue Sales of equipment We sell equipment to our customers, as well as to distributors and dealers (re-sellers) throughout the world. We recognize revenue from these sales upon the transfer of title, which is generally at the point of shipment. We do not offer any rights of return or stock balancing rights. Our sales revenue from customized equipment, mail creation equipment and shipping products is generally recognized when installed. Embedded software sales We sell equipment with embedded software to our customers. The embedded software is not sold separately, it is not a significant focus of the marketing effort and we do not provide post-contract customer support specific to the software or incur significant costs that are within the scope of SFAS 86. Additionally, the functionality that the software provides is marketed as part of the overall product. The software embedded in the equipment is incidental to the equipment as a whole such that SOP No. 97-2, Software Revenue Recognition, is not applicable. Sales of these products are recognized in accordance with either SEC Staff Accounting Bulletin (SAB) No. 104, Revenue Recognition, or SFAS No. 13, Accounting for Leases, for sales-type leases. Sales of Supplies Revenue related to supplies is recognized at the point of title transfer, which is upon shipment. Standalone Software Sales and Integration Services In accordance with SOP 97-2, we recognize revenue from standalone software licenses upon delivery of the product when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed and determinable and collectibility is probable. For software licenses that are included in a lease contract, we recognize revenue upon shipment of the software unless the lease contract specifies that the license expires at the end of the lease or the price of the software is deemed not fixed or determinable based on historical evidence of similar software leases. In these instances, revenue is recognized on a straight-line basis over the term of the lease contract. We recognize revenue from software requiring integration services at the point of customer acceptance. We recognize revenue related to off-the-shelf perpetual software licenses upon transfer of title, which is upon shipment. Rentals Revenue We rent equipment to our customers, primarily postage meters and mailing equipment, under short-term rental agreements, generally for periods of 3 months to 5 years. Rental revenue includes revenue from the subscription for digital meter services. We invoice in advance for postage meter rentals. We defer the billed revenue and include it initially in advance billings. Rental revenue is recognized on a straight-line basis over the term of the rental agreement. We defer certain initial direct costs incurred in consummating a transaction and amortize these costs over the term of the agreement. The initial direct |
Deferred Charges, Policy [Text Block] | Deferred Marketing Costs We capitalize certain direct mail, telemarketing, internet, and retail marketing costs, associated with the acquisition of new customers in accordance with SOP No. 93-7, Reporting on Advertising Costs. These costs are amortized over the expected revenue stream ranging from 5 to 9 years. We review individual marketing programs for impairment on a periodic basis or as circumstances warrant. Other assets on our Consolidated Balance Sheets at December 31, 2007 and 2006 include $121 million and $117 million, respectively, of deferred marketing costs. The Consolidated Statements of Income include the related amortization expense of $39 million, $44 million and $46 million for the years ended December 31, 2007, 2006 and 2005, respectively. |
Costs Associated with Exit or Disposal Activities or Restructurings, Policy [Text Block] | Restructuring Charges We apply the provisions of SFAS No. 146, Accounting for Costs Associated with Exit or Disposal Activities, to account for one-time benefit arrangements and exit or disposal activities. SFAS No. 146 requires that a liability for costs associated with an exit or disposal activity be recognized when the liability is incurred. We account for ongoing benefit arrangements under SFAS No. 112, Employers Accounting for Postemployment Benefits, which requires that a liability be recognized when the costs are probable and reasonably estimable. See Note 14 to the Consolidated Financial Statements. |
Income Tax, Policy [Text Block] | Income Taxes We recognize deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the period in which related temporary differences become deductible. We consider the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in this assessment. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date of such change. |
Earnings Per Share, Policy [Text Block] | Earnings per Share Basic earnings per share is based on the weighted average number of common shares outstanding during the year, whereas diluted earnings per share also gives effect to all dilutive potential common shares that were outstanding during the period. Dilutive potential common shares include preference stock, preferred stock, stock option and purchase plan shares. |
Foreign Currency Transactions and Translations Policy [Text Block] | Translation of Non-U.S. Currency Amounts Assets and liabilities of subsidiaries operating outside the U.S. are translated at rates in effect at the end of the period and revenue and expenses are translated at average monthly rates during the period. Net deferred translation gains and losses are included in accumulated other comprehensive income in stockholders equity in the Consolidated Balance Sheets. |
Derivatives, Policy [Text Block] | Derivative Instruments In the normal course of business, the company is exposed to the impact of interest rate changes and foreign currency fluctuations. The company limits these risks by following established risk management policies and procedures, including the use of derivatives. The derivatives are used to manage the related cost of debt and to limit the effects of foreign exchange rate fluctuations on financial results. In our hedging program, we normally use forward contracts, interest-rate swaps, and currency swaps depending upon the underlying exposure. We do not use derivatives for trading or speculative purposes. Changes in the fair value of the derivatives are reflected as gains or losses. The accounting for the gains or losses depends on the intended use of the derivative, the resulting designation, and the effectiveness of the instrument in offsetting the risk exposure it is designed to hedge. To qualify as a hedge, a derivative must be highly effective in offsetting the risk designated for hedging purposes. The hedge relationship must be formally documented at inception, detailing the particular risk management objective and strategy for the hedge. The effectiveness of the hedge relationship is evaluated on a retrospective and prospective basis. As a result of the use of derivative instruments, we are exposed to counterparty risk. To mitigate such risks, we enter into contracts with only those financial institutions that meet stringent credit requirements as set forth in our derivative policy. We regularly review our credit exposure balances as well as the creditworthiness of our counterparties. Foreign Exchange Contracts We enter into foreign exchange contracts to minimize the impact of exchange rate fluctuations on inter-company loans and related interest that are denominated in a foreign currency. The revaluation of the short-term inter-company loans and interest and the mark-to-market on the derivatives are both recorded to income. At December 31, 2007, we had 16 outstanding foreign exchange contracts to buy or sell various currencies with an asset value of $1.9 million. The contracts will expire by December 23, 2008. We also enter into foreign currency exchange contracts arising from the anticipated purchase of inventory between affiliates. These contracts are designed as cash flow hedges. The effective portion of the gain or loss on the cash flow hedges is included in other comprehensive income in the period that the change in fair value occurs and is reclassified to income in the same period that the hedged item affects income. At December 31, 2007, we had no outstanding contracts associated with these anticipated transactions. Certain foreign currency derivatives have been entered into to manage foreign currency transactional exposures associated with the transactions between affiliates. These derivatives have no specific hedging designation so gains or losses are recorded in income in the period that changes in fair value occur together with the offsetting foreign exchange gains or losses on the underlying assets and liabilities. At December 31, 2007, the fair value of these derivatives was a liability |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | New Accounting Pronouncements In May 2005, the Financial Accounting Standards Board (FASB) issued SFAS No. 154, Accounting Changes and Error Corrections (FAS 154), which replaces APB Opinion No. 20, Accounting Changes and SFAS No. 3, Reporting Accounting Changes in Interim Financial Statements-An Amendment of APB Opinion No. 28. FAS 154 requires retrospective application to prior periods financial statements of a voluntary change in accounting principle unless it is not practicable. FAS 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. Our adoption of FAS 154 did not have a material impact on our financial position, results of operations or cash flows. In June 2005, the FASB issued FASB Staff Position (FSP) No. FAS 143-1, Accounting for Electronic Equipment Waste Obligations, that provides guidance on how commercial users and producers of electronic equipment should recognize and measure asset retirement obligations associated with the European Directive 2002/96/EC on Waste Electrical and Electronic Equipment (the Directive). The adoption of this FSP did not have a material effect on our financial position, results of operations or cash flows for those European Union (EU) countries that enacted the Directive into country-specific laws. In June 2006, the FASB issued FASB Interpretation (FIN) No. 48, Accounting for Uncertainty in Income Taxes (FIN 48), which supplements Statement of Financial Accounting Standard No. 109, Accounting for Income Taxes, by defining the confidence level that a tax position must meet in order to be recognized in the financial statements. FIN 48 requires the tax effect of a position to be recognized only if it is more-likely-than-not to be sustained based solely on its technical merits as of the reporting date. If a tax position is not considered more-likely-than-not to be sustained based solely on its technical merits, no benefits of the position are recognized. This is a different standard for recognition than was previously required. The more-likely-than-not threshold must continue to be met in each reporting period to support continued recognition of a benefit. At adoption, companies adjusted their financial statements to reflect only those tax positions that were more-likely-than-not to be sustained as of the adoption date. Any necessary adjustment was recorded directly to opening retained earnings in the period of adoption and reported as a change in accounting principle. We adopted the provisions of FIN 48 on January 1, 2007 which resulted in a decrease to opening retained earnings of $84.4 million, with a corresponding increase in our tax liabilities. In July 2006, the FASB issued FSP No. FAS 13-2, Accounting for a Change or Projected Change in the Timing of Cash Flows Relating to Income Taxes Generated by a Leveraged Lease Transaction, that provided guidance on how a change or a potential change in the timing of cash flows relating to income taxes generated by a leveraged lease transaction affected the accounting by a lessor for the lease. We adopted the provisions of FSP No. FAS 13-2 on January 1, 2007. Our adoption of this FSP did |
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | 2 Discontinued Operations On May 1, 2006, we completed the sale of our Imagistics lease portfolio to De Lage Landen Operational Services, LLC, a subsidiary of Rabobank Group, for approximately $288 million. Net proceeds on the sale were approximately $282 million after transaction expenses. We reported the results of the Imagistics lease portfolio in discontinued operations including an after-tax gain of approximately $11 million from the sale of this portfolio. On July 14, 2006, we completed the sale of our Capital Services external financing business to Cerberus Capital Management, L.P. (Cerberus) for approximately $747 million and the assumption of approximately $470 million of non-recourse debt and other liabilities. This sale resulted in the disposition of most of the external financing activity in the Capital Services segment. The proceeds received at closing were used to pay our tax obligations. We reported the results of the Capital Services business in discontinued operations including an after-tax loss of $445 million from the sale of this business. We retained certain leveraged leases in Canada which are included in our International Mailing segment. In August 2006, we reached a settlement with the Internal Revenue Service (IRS) on all outstanding tax audit issues in dispute for tax years through 2000. Years after 2000 are still under review by the IRS. In connection with the settlement, we recorded $61 million of additional tax expense of which $41 million was included in discontinued operations. See Note 9 for further discussion of the IRS settlement. In 2006, we accrued in discontinued operations an additional tax expense of $16 million to record the impact of the Tax Increase Prevention and Reconciliation Act (TIPRA). The TIPRA legislation repealed the exclusion from federal income taxation of a portion of the income generated from certain leveraged leases of aircraft by foreign sales corporations (FSC). In December 2006, we sold our bankruptcy claim related to certain aircraft leases with Delta Airlines. We received proceeds of $14.5 million, which represent a contingent gain pending the bankruptcy court decision. Given the continued uncertainty and inability to anticipate the outcome of the bankruptcy court decision, we have not recognized any portion of this contingent gain in our consolidated income statement. The following table shows selected financial information included in discontinued operations for the years ended December 31: Discontinued Operations 2007 2006 2005 Revenue $ - $ 81,199 $ 125,247 Pretax income $ - $ 29,465 $ 38,061 Net income $ 5,534 $ 30,982 $ 35,368 Gain on sale of Imagistics, net of $7,075 tax expense - 11,065 - FSC tax law change - (16,209) - Additional tax on IRS settlement - (41,000) - Loss on sale of Capital Services, net of $284,605 tax benefit - (445,150) - Total discontinued operations, net of tax $ 5,534 $ (460,312) $ 35,368 Net income in 2007 includes a gain of $11.3 million from the conclusion of certain tax issues net of the accrual of interest expense of $5.8 million on uncertain tax position |
Schedule of Business Acquisitions by Acquisition [Text Block] | 3 Acquisitions On September 12, 2007, we acquired Asterion SAS for $28 million in cash, net of cash acquired. Asterion is a leading provider of outsourced transactional print and document process services in France. We assigned the goodwill to the Management Services segment. On May 31, 2007, we acquired the remaining shares of Digital Cement, Inc. for a total purchase price of $49 million in cash, net of cash acquired. Digital Cement, Inc. provides marketing management strategy and services to help companies acquire, retain, manage, and grow their customer relationships. We assigned the goodwill to the Marketing Services segment. On April 19, 2007, we acquired MapInfo Corporation for $446 million in cash, net of cash acquired. Included in the assets and liabilities acquired were short-term investments of $46 million and debt assumed of $14 million. MapInfo is a global company and a leading provider of location intelligence software and solutions. We assigned the goodwill to the Software segment. As part of the purchase accounting for MapInfo, we aligned MapInfos accounting policies with ours. Accordingly, certain software revenue that was previously recognized by MapInfo on a periodic basis is now being recognized over the life of the contract. On July 31, 2006, we acquired Print, Inc. for approximately $46 million in cash, net of cash acquired. Print, Inc. provides printer supplies, service and equipment under long-term managed services contracts. The goodwill was assigned to the U.S. Mailing segment. On June 15, 2006, we acquired substantially all the assets of Advertising Audit Service and PMH Caramanning (collectively AAS) for approximately $42 million in cash. AAS offers a variety of web-based tools for the customization of promotional mail and marketing collateral and designs and manages customer and channel performance solutions. The goodwill was assigned to the Marketing Services segment. On April 24, 2006, we acquired Ibis Consulting, Inc. (Ibis) for approximately $65 million in cash, net of cash acquired. Ibis is a leading provider of electronic discovery (eDiscovery) services to law firms and corporate clients. Ibis technology and offerings complement those of Compulit, which we acquired in 2005, and expands our range of solutions and services for the complex litigation support needs of law firms and corporate legal departments. The goodwill was assigned to the Management Services segment. On February 8, 2006, we acquired Emtex Ltd. (Emtex) for approximately $33 million in cash, net of cash acquired. Emtex is a software and services company that allows large-volume mailers to simplify document production and centrally manage complex multi-vendor and multi-site print operations. The goodwill was assigned to the Software segment. The following table summarizes selected financial data for the opening balance sheet allocations of the acquisitions in 2007 Asterion Digital Cement, Inc. MapInfo Corporation SAS Purchase price allocation Short-term investments $ - $ - $ 46,308 Current assets 52,900 2,146 41,213 Other non-current assets 30,685 932 35,826 Intangible assets 5,802 |
Inventory Disclosure [Text Block] | 4 Inventories December 31, 2007 2006 Raw materials and work in process $ 87,053 $ 97,870 Supplies and service parts 52,895 82,669 Finished products 58,014 57,278 Total $ 197,962 $ 237,817 If all inventories valued at LIFO had been stated at current costs, inventories would have been $23.7 million and $20.5 million higher than reported at December 31, 2007 and 2006, respectively. In 2007, we recorded an impairment charge to inventories for $48.1 million, included in the restructuring charges and asset impairments line on the Consolidated Statement of Income. See Note 14 to the Consolidated Financial Statements for further details. |
Property, Plant and Equipment Disclosure [Text Block] | 5 Fixed Assets December 31, 2007 2006 Land $ 33,961 $ 34,397 Buildings 400,548 402,200 Machinery and equipment 1,443,384 1,394,543 1,877,893 1,831,140 Accumulated depreciation (1,249,975) (1,218,500) Property, plant and equipment, net $ 627,918 $ 612,640 Rental equipment $ 1,189,675 $ 1,163,705 Accumulated depreciation (753,748) (659,794) Rental property and equipment, net $ 435,927 $ 503,911 Depreciation expense was $318.1 million, $311.2 million and $292.2 million for the years ended December 31, 2007, 2006, and 2005, respectively. Depreciation expense included amounts from discontinued operations of $9.2 million and $3.2 million for the years ended December 31, 2006 and 2005, respectively. Rental equipment is primarily comprised of postage meters. A pre-tax non-cash impairment charge of $61.5 million for net rental property and equipment was recorded in 2007 associated with our transitional initiatives, included in the restructuring charges and asset impairments line of the Consolidated Statement of Income. See Note 14 to the Consolidated Financial Statements for further details. |
Goodwill and Intangible Assets Disclosure [Text Block] | 6 Intangible Assets and Goodwill The components of our purchased intangible assets are as follows: December 31, 2007 December 31, 2006 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 427,487 $ (119,652) $ 307,835 $ 314,768 $ (84,439) $ 230,329 Supplier relationships 29,000 (7,492) 21,508 33,300 (5,954) 27,346 Mailing software & technology 176,558 (65,032) 111,526 134,476 (42,357) 92,119 Trademarks and trade names 32,661 (17,202) 15,459 28,961 (14,716) 14,245 Non-compete agreements 5,491 (4,631) 860 5,247 (4,094) 1,153 $ 671,197 $ (214,009) $ 457,188 $ 516,752 $ (151,560) $ 365,192 Amortization expense for intangible assets was $65.0 million, $53.9 million and $39.8 million for the years ended December 31, 2007, 2006 and 2005, respectively. In 2007, we recorded impairment charges of $8.5 million, included in the restructuring charges and asset impairments line of the Consolidated Statement of Income. See Note 14 to the Consolidated Financial Statements for further details. The estimated future amortization expense related to intangible assets as of December 31, 2007 is as follows: Year ended December 31, Amount 2008 $ 70,000 2009 67,000 2010 60,000 2011 54,000 2012 44,000 Thereafter 162,000 $ 457,000 During 2007 and 2006, we recorded additions to intangible assets of $158.2 million and $64.3 million, respectively. The components of these purchased intangible assets are as follows: December 31, 2007 December 31, 2006 Amount Weighted Average life Amount Weighted Average life Customer relationships $ 111,315 10 years $ 35,778 11 years Mailing software and technology 38,323 7 years 21,900 5 years Trademarks and trade names 8,500 2 years 6,390 4 years Non-compete agreements 12 4 years 228 5 years $ 158,150 9 years $ 64,296 8 years The changes in the carrying amount of goodwill, by reporting segment, for the years ended December 31, 2007 and 2006 are as follows: Balance at December 31, 2006 Acquired during the period Other Balance at December 31, 2007 U.S. Mailing $ 84,380 $ 13,703 $ 31,100 $ 129,183 International Mailing 392,434 2,486 8,908 403,828 Production Mail 102,848 4,165 3,587 110,600 Software 340,062 355,189 1,440 696,691 Mailstream Solutions 919,724 375,543 45,035 1,340,302 Management Services 429,990 28,668 2,931 461,589 Mail Services 216,709 8,524 4,554 229,787 Marketing Services 224,734 41,831 1,615 268,180 Mailstream Services 871,433 79,023 9,100 959,556 Total $ 1,791,157 $ 454,566 $ 54,135 $ 2,299,858 Balance at December 31, 2005 Acquired during the period Other Balance at December 31, 2006 U.S. Mailing $ 56,095 $ 29,686 $ (1,401) $ 84,380 International Mailing 355,947 5,072 31,415 392,434 Production Mail 94,879 4,773 |
Current Liabilities Disclosure [Text Block] | 7 Current Liabilities Accounts payable, accrued liabilities, notes payable and current portion of long-term obligations are composed of the following: December 31, 2007 2006 Accounts payable-trade $ 329,928 $ 307,134 Reserve account deposits 522,193 459,527 Accrued salaries, wages and commissions 276,154 254,454 Accrued restructuring charges 91,713 33,549 Accrued nonpension postretirement benefits 27,728 30,849 Miscellaneous accounts payable and accrued liabilities 717,851 591,988 Accounts payable and accrued liabilities $ 1,965,567 $ 1,677,501 Notes payable 405,213 489,706 Current portion of long-term debt and capital leases 548,554 834 Notes payable and current portion of long-term obligations $ 953,767 $ 490,540 In countries outside the U.S., banks generally lend to our non-finance subsidiaries on an overdraft or term-loan basis. These overdraft arrangements and term-loans, for the most part, are extended on an uncommitted basis by banks and do not require compensating balances or commitment fees. Reserve account deposits represent customers prepayment of postage. Deposits are held by our subsidiary, Pitney Bowes Bank. See Note 18 to the Consolidated Financial Statements for further details. Notes payable are issued as commercial paper, loans against bank lines of credit, or to trust departments of banks and others at below prevailing prime rates. The weighted average interest rates were 4.3% and 5.3% on notes payable and overdrafts outstanding at December 31, 2007 and 2006, respectively. At December 31, 2007, notes payable totaled $405.2 million. We had unused credit facilities of $1.5 billion at December 31, 2007, primarily to support commercial paper issuances. Fees paid to maintain lines of credit were $0.8 million, $0.9 million and $0.7 million in 2007, 2006 and 2005, respectively. |
Long-term Debt [Text Block] | 8 Long-term Debt December 31, 2007 2006 Recourse debt 5.75% notes due 2008 (1) $ - $ 350,000 8.63% notes due 2008 (1) - 100,000 9.25% notes due 2008 (1) - 100,000 8.55% notes due 2009 (1) 150,000 150,000 4.65% to 5.57% notes due 2010 - 150,000 5.32% credit facility due 2012 150,000 - 4.63% notes due 2012 400,000 400,000 3.88% notes due 2013 375,000 375,000 4.88% notes due 2014 450,000 450,000 5.00% notes due 2015 400,000 400,000 4.75% notes due 2016 500,000 500,000 5.75% notes due 2017 500,000 - 3.75% to 5.43% notes due 2018 350,000 350,000 5.25% notes due 2037 500,000 500,000 Fair value hedges basis adjustment 25,753 27,757 Mortgage 13,186 - Other (2) (11,864) (5,140) Total long-term debt $ 3,802,075 $ 3,847,617 (1)In 2002, we received $95 million in cash from the termination of four swap agreements associated with these notes. This amount is being reflected as a reduction of interest expense over the remaining term of these notes. As a result of this transaction, the weighted average effective rate on these notes is 4.77%. The notes due in 2008 for a face value of $550 million are reported as current liabilities at December 31, 2007. (2)Other consists primarily of debt discounts and premiums. On December 31, 2007, $0.6 billion remained available under the shelf registration statement filed in February 2005 with the SEC, permitting issuances of up to $2.5 billion in debt securities, preferred stock, preference stock, common stock, purchase contracts, depositary shares, warrants and units. In December 2007, we entered into a $150 million syndicated bank transaction priced at 3 month LIBOR plus 35 basis points. The proceeds from this credit facility, due 2012, were used to pay off the $150 million variable rate debt that was due in 2010. In September 2007, we issued $500 million of unsecured fixed rate notes maturing in September 2017. These notes bear interest at an annual rate of 5.75% and pay interest semi-annually beginning in March 2008. The proceeds from these notes were used for general corporate purposes, including the repayment of commercial paper, the financing of acquisitions, and repurchase of our stock. In November 2006, we issued $500 million of unsecured fixed rate notes maturing in January 2037. These notes bear interest at an annual rate of 5.25% and pay interest semi-annually beginning in July 2007. The proceeds from these notes were used for general corporate purposes, including the repayment of commercial paper, the financing of acquisitions and repurchase of the Companys stock. The annual maturities of the outstanding debt during each of the next five years are as follows: 2008, $550 million; 2009, $150 million; 2010 no maturities; 2011 no maturities; 2012, $550 million; and $3,075 million thereafter. The mortgage relates to debt assumed with the acquisition of MapInfo Corporation. The annual maturities of the outstanding mortgage for 2008 - 2012 are $0.3 million each year and $12.0 million thereafter. The fair value hedges basis adjustment represe |
Income Tax Disclosure [Text Block] | 9 Income Taxes Years ended December 31, 2007 2006 2005 Continuing operations: Total current $ 160,839 $ 298,364 $ 217,042 Total deferred 119,383 36,640 111,555 Provision for income taxes $ 280,222 $ 335,004 $ 328,597 U.S. and international components of income from operations before income taxes and minority interest are as follows: Years ended December 31, 2007 2006 2005 Continuing operations: U.S. $ 624,030 $ 719,931 $ 623,529 International 36,681 194,559 188,139 Total continuing operations 660,711 914,490 811,668 Discontinued operations - (682,149) 38,061 Total $ 660,711 $ 232,341 $ 849,729 The effective tax rates for continuing operations for 2007, 2006 and 2005 were 42.4%, 36.6% and 40.5%, respectively. The effective tax rate for 2007 included $54 million of tax charges related principally to a valuation allowance for certain deferred tax assets and tax rate changes outside of the U.S. The effective tax rate for 2006 and 2005 included a $20 million and $56 million charge, respectively, related to the IRS settlement discussed below. The items accounting for the difference between income taxes computed at the federal statutory rate and our provision for income taxes consist of the following: 2007 2006 2005 Continuing operations: Federal statutory provision $ 231,249 $ 320,072 $ 284,084 Life insurance tax reserve, federal and state - 20,000 56,000 State and local income taxes 12,281 22,194 19,452 Foreign tax differential 2,379 (12,713) (11,517) Valuation allowance 51,724 - - Rate change 2,485 - - Tax exempt income/reimbursement (6,743) (15,110) (4,162) Federal income tax credits/incentives (12,732) (2,508) (5,966) Other, net (421) 3,069 (9,294) Provision for income taxes $ 280,222 $ 335,004 $ 328,597 Discontinued operations: Federal statutory provision - (238,753) 13,321 State and local income taxes - (29,225) (642) External financing transactions (5,534) 46,140 (9,986) Total provision for income taxes $ 274,688 $ 113,166 $ 331,290 The components of our total provision for income taxes are as follows: Years ended December 31, 2007 2006 2005 U.S. Federal: Current $ 136,528 $ 1,090,252 $ 166,590 Deferred 53,235 (1,021,669) 81,351 189,763 68,583 247,941 U.S. State and Local: Current 12,813 179,602 18,867 Deferred 6,083 (190,420) 10,071 18,896 (10,818) 28,938 International: Current 5,964 7,567 36,552 Deferred 60,065 47,834 17,859 66,029 55,401 54,411 Total Current 155,305 1,277,421 222,009 Total Deferred 119,383 (1,164,255) 109,281 Total provision for income taxes $ 274,688 $ 113,166 $ 331,290 The components of our deferred tax liabilities and assets are as follows: December 31, 2007 2006 Deferred tax liabilities: Depreciation $ 44,125 $ 82,578 Deferred profit (for tax purposes) |
Preferred Stockholders' Equity In Subsidiaries Disclosure [Text Block] | 10 Preferred Stockholders Equity in Subsidiary Companies Pitney Bowes International Holdings, Inc., a subsidiary of the Company, has 3,750,000 shares outstanding or $375 million of variable term voting preferred stock owned by certain outside institutional investors. Of these shares outstanding, 750,000 were issued in December 2006. These preferred shares are entitled to 25% of the combined voting power of all classes of capital stock. All outstanding common stock of Pitney Bowes International Holdings, Inc., representing the remaining 75% of the combined voting power of all classes of capital stock, is owned directly or indirectly by Pitney Bowes Inc. The preferred stock, $.01 par value, is entitled to cumulative dividends at rates set at auction. The weighted average dividend rate in 2007 and 2006 was 4.9% and 4.4%, respectively. Preferred dividends are included in minority interest in the Consolidated Statements of Income. The preferred stock is subject to mandatory redemption based on certain events, at a redemption price not less than $100 per share, plus the amount of any dividends accrued or in arrears. No dividends were in arrears at December 31, 2007 or 2006. Additionally a subsidiary of the Company has 100 shares or $10 million of 9.11% Cumulative Preferred Stock, mandatorily redeemable in 20 years, outstanding and owned by an institutional investor. |
Stockholders' Equity Note Disclosure [Text Block] | 11 Stockholders Equity At December 31, 2007, 480,000,000 shares of common stock, 600,000 shares of cumulative preferred stock, and 5,000,000 shares of preference stock were authorized. At December 31, 2007, 214,514,959 shares of common stock (net of 108,822,953 shares of treasury stock), 135 shares of 4% convertible cumulative preferred stock (4% preferred stock) and 37,069 shares of $2.12 convertible preference stock ($2.12 preference stock) were issued and outstanding. In the future, the Board of Directors can issue the balance of unreserved and unissued preferred stock (599,865 shares) and preference stock (4,962,931 shares). The Board will determine the dividend rate, terms of redemption, terms of conversion (if any) and other pertinent features. At December 31, 2007, unreserved and unissued common stock (exclusive of treasury stock) amounted to 113,975,174 shares. The 4% preferred stock outstanding, entitled to cumulative dividends at the rate of $2 per year, can be redeemed at our option, in whole or in part at any time, at the price of $50 per share, plus dividends accrued to the redemption date. Each share of the 4% preferred stock can be converted into 24.24 shares of common stock, subject to adjustment in certain events. The $2.12 preference stock is entitled to cumulative dividends at the rate of $2.12 per year and can be redeemed at our option at the rate of $28 per share. Each share of the $2.12 preference stock can be converted into 16.53 shares of common stock, subject to adjustment in certain events. Cash dividends paid on common stock were $1.32 per share, $1.28 per share and $1.24 per share for 2007, 2006, and 2005 respectively. At December 31, 2007, a total of 616,022 shares of common stock were reserved for issuance upon conversion of the 4% preferred stock (3,272 shares) and $2.12 preference stock (612,750 shares). In addition, 21,769,139 shares of common stock were reserved for issuance under our dividend reinvestment and other corporate plans. The following table summarizes the preferred, preference and common stock outstanding: Common Stock Preferred Stock Preference Stock Issued Treasury Outstanding Balance, December 31, 2004 385 46,405 323,337,912 (93,019,539) 230,318,373 Repurchase of common stock. (5,945,778) Issuances of common stock 2,276,222 Conversions of common stock (50) (3,459) 58,389 Balance, December 31, 2005 335 42,946 323,337,912 (96,630,706) 226,707,206 Repurchase of common stock. (9,180,216) Issuances of common stock 3,026,290 Conversions of common stock (200) (3,339) 60,042 BalanceDecember31, 2006 135 39,607 323,337,912 (102,724,590) 220,613,322 Repurchase of common stock (9,075,104) Issuances of common stock 2,934,801 Conversions of common stock - (2,538) 41,940 Balance, December 31, 2007 135 37,069 323,337,912 (108,822,953) 214,514,959 Accumulated Other Comprehensive Income (Loss) The components of accumulated other comprehensive income are as follow: 2007 2006 2005 Foreign currency translation adjustments $ 341,252 $ 176,524 |
Stock Plans [Text Block] | 12 Stock Plans Effective January 1, 2006, we adopted the provisions of FAS 123(R). FAS 123(R) established accounting for stock-based awards exchanged for employee services. Accordingly, stock-based compensation cost is measured at the grant date, based on the fair value of the award, and is recognized as expense over the employee requisite service period. We elected to adopt the modified retrospective application method as provided by FAS 123(R), and, accordingly, financial statement amounts for 2005 have been adjusted to reflect the fair value method of expensing prescribed by FAS 123(R) The following table shows total stock-based compensation expense for stock options, restricted stock units, and employee stock purchase plans. Years Ended December 31, 2007 2006 2005 Stock options $ 14,001 $ 20,412 $ 23,401 Restricted stock units 7,115 3,363 - Employee stock purchase plans 3,015 3,600 3,822 Pre-tax stock-based compensation $ 24,131 $ 27,375 $ 27,223 The following table shows stock-based compensation expense as included in the Condensed Consolidated Statements of Income: Years Ended December 31, 2007 2006 2005 Cost of equipment sales $ 1,649 $ 1,869 $ 1,845 Cost of support services 710 806 796 Cost of business services 980 1,112 1,111 Selling, general and administrative expense 19,984 22,669 22,526 Research and development expense 808 919 945 Pre-tax stock-based compensation 24,131 27,375 27,223 Income tax (8,277) (9,308) (9,256) Stock-based compensation expense, net $ 15,854 $ 18,067 $ 17,967 Basic earnings per share impact $ 0.07 $ 0.08 $ 0.08 Diluted earnings per share impact $ 0.07 $ 0.08 $ 0.08 Capitalized stock-based compensation costs at December 31, 2007 and 2006 were not material. At December 31, 2007, $15.3 million of unrecognized compensation cost related to non-vested stock options is expected to be recognized over a weighted average period of 2.0 years. At December 31, 2007, $15.2 million of unrecognized compensation cost related to non-vested restricted stock units is expected to be recognized over a weighted average period of 2.8 years. The total intrinsic value of options exercised during the years ended December 31, 2007, 2006 and 2005, was $28.1 million, $23.2 million and $21.9 million, respectively. The total intrinsic value of restricted stock units converted during 2007 was $3.3 million. Proceeds from issuance of stock in our Consolidated Statements of Cash Flows for the years ended December 31, 2007, 2006 and 2005 include $5.0 million, $3.4 million and $3.9 million of windfall tax benefits from stock options exercised and restricted stock units converted, respectively. We settle employee stock compensation awards with treasury shares. Starting in 2006, we modified our stock-based compensation awards, requiring a minimum requisite service period of one year for retirement eligible employees. At December 31, 2007, there were 15,416,166 shares available for future grants of stock options and restricted stock units under our stock plans. |
Retirement Plans and Postretirement Medical Benefits [Text Block] | 13 Retirement Plans and Postretirement Medical Benefits We have several defined benefit and defined contribution retirement plans covering substantially all employees worldwide. Benefits are primarily based on employees compensation and years of service. Our contributions are determined based on the funding requirements of U.S. federal and other governmental laws and regulations. We use a measurement date of December 31 for all of our retirement plans. U.S. employees hired after January 1, 2005, Canadian employees hired after April 1, 2005, and U.K. employees hired after July 1, 2005, are not eligible for our defined benefit retirement plans. We contributed $30.5 million, $28.1 million and $22.6 million to our U.S. defined contribution plans in 2007, 2006 and 2005, respectively. Defined Benefit Pension Plans The change in benefit obligations, plan assets and the funded status for defined benefit pension plans are as follows: United States Foreign 2007 2006 2007 2006 Change in benefit obligation: Benefit obligation at beginning of year $ 1,621,463 $ 1,638,252 $ 522,451 $ 471,420 Service cost 28,204 26,495 12,797 11,207 Interest cost 93,977 91,652 27,627 22,666 Plan participants contributions - - 2,924 2,781 Actuarial gain (41,067) (21,909) (25,544) (2,655) Foreign currency changes - - 32,299 33,360 Curtailment - - 906 883 Special termination benefits 1,187 - - - Benefits paid (111,035) (113,027) (18,443) (17,211) Benefit obligation at end of year $ 1,592,729 $ 1,621,463 $ 555,017 $ 522,451 United States Foreign 2007 2006 2007 2006 Change in plan assets: Fair value of plan assets at beginning of year $ 1,655,283 $ 1,528,917 $ 476,939 $ 411,518 Actual return on plan assets 121,973 232,254 31,490 40,721 Company contributions 8,781 7,139 8,926 9,513 Plan participants contributions - - 2,924 2,781 Foreign currency changes - - 28,479 29,617 Benefits paid (111,035) (113,027) (18,443) (17,211) Fair value of plan assets at end of year $ 1,675,002 $ 1,655,283 $ 530,315 $ 476,939 Funded status, end of year: Fair value of plan assets at end of year $ 1,675,002 $ 1,655,283 $ 530,315 $ 476,939 Benefit obligations at end of year 1,592,729 1,621,463 555,017 522,451 Funded status $ 82,273 $ 33,820 $ (24,702) $ (45,512) Information for pension plans, that are included above, with an accumulated benefit obligation in excess of plan assets at December 31, 2007 and 2006 were as follows: United States Foreign 2007 2006 2007 2006 Projected benefit obligation $ 97,671 $ 95,370 $ 36,086 $ 35,700 Accumulated benefit obligation $ 78,564 $ 78,392 $ 34,428 $ 33,955 Fair value of plan assets $ 1,656 $ 1,521 $ 10,885 $ 9,548 The accumulated benefit obligation for all U.S. defined benefit plans at December 31, 2007 and 2006 was $1.5 billion for both years. The accumulated benefit obligation for all foreign defined benefit pla |
Restructuring and Related Activities Disclosure [Text Block] | 14 Restructuring Charges and Asset Impairments We recorded pre-tax restructuring charges and asset impairments of $264 million in 2007. These charges relate primarily to a program we announced in November 2007 to lower our cost structure, accelerate efforts to improve operational efficiencies, and transition our product line. The program includes charges primarily associated with older equipment that we have stopped selling upon transition to the new generation of fully digital, networked, and remotely-downloadable equipment. The asset impairment charges related to these initiatives include the write-off of inventory ($48.1 million), rental assets ($61.5 million), lease residual values ($46.1 million), and other assets ($8.8 million). The cash portion of the restructuring charges includes employee termination costs ($85.1 million) and other exit costs ($5.8 million) and relates primarily to our efforts to lower our cost structure and accelerate improvements in operational efficiencies. As a result of this program, we expect a net reduction of about 1,500 positions. About half of these reductions will be outside of the U.S. As of December 31, 2007, 401 employees had been terminated under this program. Other exit costs relate primarily to lease termination costs and other costs associated with exiting product lines and business activities. We expect to incur approximately $20 million of additional restructuring charges in 2008 associated with these actions, however, we continue to evaluate additional actions in conjunction with this program. We expect to complete the majority of this program by the end of 2008. In addition, asset impairments also include the write-down of certain intangible assets for $8.5 million. The pre-tax restructuring charges and asset impairments are composed of: Restructuring charges Non-cash charges Cash payments Balance December 31, 2007 Severance and benefit costs $ 85,137 $ - $ (3,886) $ 81,251 Asset impairments 173,081 (173,081) - - Other exit costs 5,795 - - 5,795 Total $ 264,013 $ (173,081) $ (3,886) $ 87,046 In January 2003, we undertook restructuring initiatives related to realigned infrastructure requirements and reduced manufacturing needs for digital equipment. In connection with this plan, we recorded pre-tax restructuring charges of $36 million and $54 million for the years ended December 31, 2006 and 2005, respectively. The 2005 charge is net of a $30 million gain on the sale of our main plant manufacturing facility. The activities associated with this program were substantially completed in 2006. During 2007, 2006, and 2005 we made restructuring payments of $29 million, $51 million and $48 million (net of the $30 million gain), respectively. At December 31, 2007, we have a remaining liability associated with this program of $5 million. See Note 1 to the Consolidated Financial Statements for our accounting policy related to restructuring charges and asset impairments. |
Commitments, Contingencies, and Regulatory Matters [Text Block] | 15 Commitments, Contingencies and Regulatory Matters Legal Proceedings In the ordinary course of business, we are routinely defendants in or party to a number of pending and threatened legal actions. These may involve litigation by or against us relating to, among other things, contractual rights under vendor, insurance or other contracts; intellectual property or patent rights; equipment, service, payment or other disputes with customers; or disputes with employees. Some of these actions may be brought as a purported class action on behalf of a purported class of employees, customers or others. We are a defendant in a patent action brought by Ricoh Company, Ltd. in which there are allegations of infringement against certain of our important mailing products, including the DM SeriesTM. Ricoh Corporation et al. v. Pitney Bowes Inc. (United States District Court, District of New Jersey, filed November 26, 2002). The plaintiff in this action is seeking both large damage and injunctive relief. We prevailed at the trial held in this matter in the fall of 2006. The jury found the Ricoh patents at issue to be invalid. Even though a finding of invalidity means that the plaintiffs claim must fail, the jury was also required to rule on infringement and found that we infringed the Ricoh patents and did so willfully. As a result of the invalidity finding, we prevailed and no damages were awarded. The matter is currently on appeal to the United States Court of Appeals for the Federal Circuit. Our wholly-owned subsidiary, Imagitas, Inc., is a defendant in ten purported class actions filed in six different states. These litigations have been consolidated into a single federal multi-district litigation in the United States District for the Middle District of Florida, In re: Imagitas, Drivers Privacy Protection Act (Consolidated, May 28, 2007). Each of these lawsuits alleges that the Imagitas DriverSource program violates the federal Drivers Privacy Protection Act (DPPA). Under the DriverSource program, Imagitas enters into contracts with state governments to mail out automobile registration renewal materials along with third party advertisements, without revealing the personal information of any state resident to any advertiser. The DriverSource program assists the state in performing its function of delivering these mailings and funding the costs of them. The plaintiffs in these actions are seeking both statutory damages under the DPPA and an injunction against the continuation of the program. The plaintiffs have also sued state officials in four of the affected states, Florida, Minnesota, Missouri, and Ohio. Those suits have also been consolidated into the multi-district litigation. The state officials from Florida who were sued in their individual capacity have reached a settlement with the plaintiffs. As a result of that settlement, Imagitas has agreed to voluntarily suspend a portion of the program, pending a ruling in the litigation against it. During this period, Imagitas will still be placing advertisements in the registration renewal forms in Florida. We expect to prevail in both the Ricoh litigation and the lawsuits against Imagitas; howe |
Product Warranty Disclosure [Text Block] | Product Warranty We provide product warranties in conjunction with certain product sales, generally for a period of 90 days from the date of installation. Our product warranty liability reflects our best estimate of probable liability or product warranties based on historical claims experience, which has not been significant, and other currently available evidence. Accordingly, our product warranty liability at December 31, 2007 and 2006, respectively, was not material. |
Schedule of Guarantee Obligations [Text Block] | 16 Guarantees We apply FIN No. 45, Guarantors Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others, to our agreements that contain guarantees or indemnifications. The provisions of FIN 45 require that at the time a company issues a guarantee, it must recognize an initial liability for the fair value, or market value, of the obligations it assumes under the guarantee and must disclose that information in its interim and annual financial statements. The provisions related to recognizing a liability at inception of the guarantee for the fair value of the guarantors obligations does not apply to product warranties or to guarantees accounted for as derivatives. As part of the sale of the Capital Services business in the second quarter of 2006, we indemnified the buyer for certain guarantees by posting letters of credit at the date of sale. At December 31, 2007, the outstanding balance of these guarantees was $8.5 million. Our maximum risk of loss related to these letters of credit arises from the possible non-performance of lessees to meet the terms of their contracts and from changes in the value of the underlying equipment. These contracts are secured by the underlying equipment value and supported by the creditworthiness of the customer. |
Operating Leases of Lessor Disclosure [Text Block] | 17 Leases In addition to factory and office facilities owned, we lease similar properties, as well as sales and service offices, equipment and other properties, generally under long-term operating lease agreements extending from 3 to 25 years. Future minimum lease payments under non-cancelable operating leases at December 31, 2007 are as follows: Years ending December 31, Operating leases 2008 $ 88,740 2009 65,504 2010 47,457 2011 31,347 2012 20,664 Thereafter 38,345 Total minimum lease payments $ 292,057 Rental expense was $146.9 million, $138.8 million and $158.4 million in 2007, 2006 and 2005, respectively. |
Finance Assets [Text Block] | 18 Finance Assets Finance Receivables Finance receivables are generally due in monthly, quarterly or semi-annual installments over periods ranging from 3 to 5 years and are comprised of sales-type leases and customer loan receivables. The components of finance receivables were as follows: December 31, 2007 2006 Gross finance receivables $ 3,587,947 $ 3,480,695 Unguaranteed residual values 260,815 281,581 Unearned income (740,046) (749,728) Initial direct cost deferred 1,914 4,174 Allowance for credit losses (78,371) (82,499) Net investment in finance receivables $ 3,032,259 $ 2,934,223 Net investment in finance receivables include net customer loan receivables at December 31, 2007 and 2006 of $552.9 million and $524.7 million, respectively. Customer loan receivables arise primarily from financing services offered to our customers for postage, supplies, and shipping payments. Customer loan receivables are generally due each month, however, customers may rollover outstanding balances. See discussion on Pitney Bowes bank below. As part of our 2007 transition initiatives, we recorded a charge of $46.1 million for the impairment of unguaranteed residual values which was included in the restructuring charges and asset impairments line of the Consolidated Statement of Income. Also see Note 14 to the Consolidated Financial Statements for further details. Maturities of gross finance receivables are as follows: Years ending December 31, 2008 $ 1,650,947 2009 798,667 2010 584,410 2011 364,901 2012 170,292 Thereafter 18,730 Total $ 3,587,947 Pitney Bowes Bank The Pitney Bowes Bank (PBB), our wholly owned subsidiary, is a Utah-chartered Industrial Loan Company (ILC). At December 31, 2007, the Bank had assets of $672 million and of liabilities of $617 million. The banks assets consist of finance receivables, short-term investments and cash. PBBs key product offering, Purchase Power, is a revolving credit solution, which enables customers to defer payment for postage when they refill their meter. PBB earns revenue through transaction fees, finance charges on outstanding balances, and other fee items. The banks liabilities consist primarily of PBBs deposit solution, Reserve Account, which provides value to large-volume mailers who prefer to prepay postage. The FDIC and the Utah Department of Financial Institutions provide oversight of PBB. Leveraged Leases Our investment in leveraged lease assets consists of the following: December 31, 2007 2006 Rental receivables $ 1,889,083 $ 1,687,730 Unguaranteed residual values 32,487 28,536 Principal and interest on non-recourse loans (1,478,555) (1,326,361) Unearned income (193,824) (174,534) Investment in leveraged leases 249,191 215,371 Less: Deferred taxes related to leveraged leases (117,500) (90,716) Net investment in leveraged leases $ 131,691 $ 124,655 In the fourth quarter of 2006, we determined the need to adjust the accounting for our remaining leveraged lease transactions. As a result, we rec |
Segment Reporting Disclosure [Text Block] | 19 Business Segment Information We conduct our business activities in seven business segments within the Mailstream Solutions and Mailstream Services business groups. For a description of our reportable segments and the types of products and services from which each reportable segment derives its revenue, see Item 1 - Business on page 3. That information is incorporated herein by reference. The information set forth below should be read in conjunction with such information. The accounting policies of the segments are the same as those described in the summary of significant accounting policies, with the exception of the items outlined below. EBIT is determined by deducting from revenue the related costs and expenses attributable to the segment. Segment EBIT excludes general corporate expenses, restructuring charges, interest expense, other income (expense) and income taxes. Identifiable assets are those used in our operations and exclude cash and cash equivalents, short-term investments and general corporate assets. Long-lived assets exclude finance receivables and investment in leveraged leases. Revenue and earnings before interest and taxes (EBIT) by business segment and geographic area follows: Revenue 2007 2006 2005 U.S. Mailing $ 2,346,431 $ 2,350,284 $ 2,259,533 International Mailing 1,069,713 1,013,278 917,237 Production Mail 603,038 575,353 533,972 Software 346,020 202,415 174,085 Mailstream Solutions 4,365,202 4,141,330 3,884,827 Management Services 1,134,767 1,073,911 1,072,395 Mail Services 458,983 369,765 334,746 Marketing Services 170,843 145,012 74,968 Mailstream Services 1,764,593 1,588,688 1,482,109 Total $ 6,129,795 $ 5,730,018 $ 5,366,936 Geographic areas: United States 4,394,156 4,213,247 3,962,819 Outside the United States 1,735,639 1,516,771 1,404,117 Total $ 6,129,795 $ 5,730,018 $ 5,366,936 EBIT 2007 2006 2005 U.S. Mailing $ 956,375 $ 943,657 $ 905,797 International Mailing 162,257 179,377 182,198 Production Mail 73,003 65,574 48,729 Software 55,318 33,343 26,981 Mailstream Solutions 1,246,953 1,221,951 1,163,705 Management Services 76,051 83,169 68,936 Mail Services 64,707 42,986 19,776 Marketing Services 8,930 20,056 10,187 Mailstream Services 149,688 146,211 98,899 Total $ 1,396,641 $ 1,368,162 $ 1,262,604 Geographic areas: United States 1,194,846 1,160,382 1,053,186 Outside the United States 201,795 207,780 209,418 Total $ 1,396,641 $ 1,368,162 $ 1,262,604 Additional segment information is as follows: Years ended December 31, 2007 2006 2005 Depreciation and amortization: U.S. Mailing $ 158,568 $ 150,784 $ 141,523 International Mailing 67,192 60,125 58,178 Production Mail 7,809 8,445 5,401 Software 29,147 12,403 11,624 Mailstream Solutions 262,716 231,757 216,726 Management Services 65,480 64,507 58,998 Mail Services 27,573 29, |
Fair Value Disclosures [Text Block] | 20 Fair Value of Financial Instruments The following methods and assumptions were used to estimate the fair value of each class of financial instruments: Cash, Cash Equivalents, Short-term Investments, Accounts Receivable, Accounts Payable and Notes Payable The carrying amounts approximate fair value because of the short maturity of these instruments. Investment Securities The fair value of investment securities is estimated based on quoted market prices, dealer quotes and other estimates. Loans Receivable The fair value of loans receivable is estimated based on quoted market prices, dealer quotes or by discounting the future cash flows using current interest rates at which similar loans would be made to borrowers with similar credit ratings and similar remaining maturities. Long-term Debt The fair value of long-term debt is estimated based on quoted dealer prices for the same or similar issues. Interest Rate Swap Agreements and Foreign Currency Exchange Contracts The fair values of interest rate swaps and foreign currency exchange contracts are obtained from dealer quotes. These values represent the estimated amount we would receive or pay to terminate agreements, taking into consideration current interest rates, the creditworthiness of the counterparties and current foreign currency exchange rates. The estimated fair value of our financial instruments follows: December 31, 2007 December 31, 2006 Carrying Carrying value (1) Fair value value (1) Fair value Investment securities 200,006 200,005 142,217 142,217 Loans receivable 554,370 554,370 524,717 524,717 Long-term debt (3,848,359) (3,722,209) (3,905,634) (3,796,270) Interest rate swaps 7,635 7,635 (7,543) (7,543) Foreign currency exchange contracts (12) (12) (8,468) (8,468) (1) Carrying value includes accrued interest and deferred fee income, where applicable. |
Earnings Per Share [Text Block] | 21 Earnings per Share A reconciliation of the basic and diluted earnings per share computations for income from continuing operations for the years ended December 31, 2007, 2006 and 2005 is as follows: 2007 Income Shares Per Share Income from continuing operations $ 361,247 Less: Preferred stock dividends - Preference stock dividends (81) Basic earnings per share $ 361,166 218,444,268 $ 1.65 Basic earnings per share $ 361,166 218,444,268 Effect of dilutive securities: Preferred stock - 3,272 Preference stock 81 637,877 Stock options - 1,971,010 Other - 163,319 Diluted earnings per share $ 361,247 221,219,746 $ 1.63 Basic earnings per share of common stock: Continuing operations $ 1.65 Discontinued operations 0.03 Net income $ 1.68 Diluted earnings per share of common stock: Continuing operations $ 1.63 Discontinued operations 0.03 Net income $ 1.66 2006 Income Shares Per Share Income from continuing operations $ 565,659 Less: Preferred stock dividends (1) Preference stock dividends (86) Basic earnings per share $ 565,572 222,473,514 $ 2.54 Basic earnings per share $ 565,572 222,473,514 Effect of dilutive securities: Preferred stock 1 6,815 Preference stock 86 682,934 Stock options - 2,093,517 Other - 186,280 Diluted earnings per share $ 565,659 225,443,060 $ 2.51 Basic earnings per share of common stock: Continuing operations $ 2.54 Discontinued operations (2.07) Net income $ 0.47 Diluted earnings per share of common stock: Continuing operations $ 2.51 Discontinued operations (2.04) Net income $ 0.47 2005 Income Shares Per Share Income from continuing operations $ 473,243 Less: Preferred stock dividends (1) Preference stock dividends (93) Basic earnings per share $ 473,149 228,833,070 $ 2.07 Basic earnings per share $ 473,149 228,833,070 Effect of dilutive securities: Preferred stock 1 8,307 Preference stock 93 732,276 Stock options - 2,381,656 Other - 133,869 Diluted earnings per share $ 473,243 232,089,178 $ 2.04 Basic earnings per share of common stock: Continuing operations $ 2.07 Discontinued operations 0.15 Net income $ 2.22 Diluted earnings per share of common stock: Continuing operations $ 2.04 Discontinued operations 0.15 Net income $ 2.19 In accordance with SFAS No. 128, Earnings per Share, 0.5 million, 0.8 million and 1.5 million common stock equivalent shares in 2007, 2006 and 2005, respectively, issuable upon the exercise of stock options were excluded from the above computations because the exercise prices of such options were greater than the average market price of the common stock, and therefore the impact of these shares was anti-dilutive. |
Quarterly Financial Information [Text Block] | 22 Quarterly Financial Data (unaudited) Summarized quarterly financial data for 2007 and 2006 follows: 2007 First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Total revenue $ 1,414,237 $ 1,543,034 $ 1,508,277 $ 1,664,247 $ 6,129,795 Gross profit (1) 756,734 837,725 799,143 865,438 3,259,040 Restructuring charges and asset impairments - - 4,300 259,713 264,013 Income (loss) from continuing operations 146,584 153,581 129,240 (68,158) 361,247 Income (loss) from discontinued operations (1,788) (1,342) (1,565) 10,229 5,534 Net income (loss) 144,796 152,239 127,675 (57,929) 366,781 Basic earnings (loss) per share: Continuing operations $ 0.67 $ 0.70 $ 0.59 $ (0.32) $ 1.65 Discontinued operations (0.01) (0.01) (0.01) 0.05 0.03 Net income (loss) per share $ 0.66 $ 0.69 $ 0.58 $ (0.27) $ 1.68 Diluted earnings (loss) per share: Continuing operations $ 0.66 $ 0.69 $ 0.58 $ (0.31) $ 1.63 Discontinued operations (0.01) (0.01) (0.01) 0.05 0.03 Net income (loss) per share $ 0.65 $ 0.68 $ 0.58 $ (0.26) $ 1.66 2006 First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Total revenue $ 1,361,646 $ 1,389,210 $ 1,433,331 $ 1,545,831 $ 5,730,018 Gross profit (1) 731,720 754,195 769,497 834,279 3,089,691 Restructuring charges 5,597 5,041 6,771 18,590 35,999 Income from continuing operations 136,859 121,252 144,227 163,321 565,659 (Loss) income from discontinued operations 16,669 (477,326) 4,393 (4,048) (460,312) Net income (loss) 153,528 (356,074) 148,620 159,273 105,347 Basic earnings (loss) per share: Continuing operations $ 0.61 $ 0.55 $ 0.65 $ 0.74 $ 2.54 Discontinued operations 0.07 (2.15) 0.02 (0.02) (2.07) Net income (loss) per share $ 0.68 $ (1.61) $ 0.67 $ 0.72 $ 0.47 Diluted earnings (loss) per share: Continuing operations $ 0.60 $ 0.54 $ 0.64 $ 0.73 $ 2.51 Discontinued operations 0.07 (2.13) 0.02 (0.02) (2.04) Net income (loss) per share $ 0.67 $ (1.59) $ 0.66 $ 0.71 $ 0.47 (1) Gross profit is defined as total revenue less cost of equipment sales, cost of supplies, cost of software, cost of rentals, cost of support services and cost of business services. The sum of the quarters and earnings per share amounts may not equal the annual and total amounts due to rounding. |
Schedule of Valuation and Qualifying Accounts Disclosure [Text Block] | PITNEY BOWES INC. SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES FOR THE YEARS ENDED DECEMBER 31, 2005 TO 2007 (Dollars in thousands) Balance at Balance at Description Beginning of year Additions Deductions end of year Allowance for doubtful accounts 2007 $ 50,052 $ 19,880 (1) $ (20,608) (2) $ 49,324 2006 $ 46,261 $ 27,718 (1) $ (23,927) (2) $ 50,052 2005 $ 50,254 $ 8,707 (1) $ (12,700) (2) $ 46,261 Allowance for credit losses on finance receivables 2007 $ 82,499 $ 44,440 $ (48,568) (2) $ 78,371 2006 $ 128,862 $ 39,432 $ (85,795) (2) $ 82,499 2005 $ 173,032 $ 51,566 $ (95,736) (2) $ 128,862 (3) Valuation allowance for deferred tax asset (4) 2007 $ 33,563 $ 64,487 $ (28,258) $ 69,792 2006 $ 21,777 $ 13,583 $ (1,797) $ 33,563 2005 $ 18,427 $ 7,641 $ (4,291) $ 21,777 (1) Includes additions charged to expenses, additions from acquisitions and impact of foreign exchange translation. (2) Includes uncollectible accounts written off and amounts included in divestitures. (3) Includes $41,104 related to the Imagistics lease portfolio and Capital Services, which were sold in 2006. (4) Included in Consolidated Balance Sheet as a liability. |