Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | Apr. 26, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | PITNEY BOWES INC /DE/ | |
Entity Central Index Key | 78,814 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 186,500,998 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenue: | ||
Equipment sales | $ 162,974 | $ 159,361 |
Supplies | 66,818 | 72,051 |
Software | 77,867 | 78,058 |
Rentals | 99,870 | 104,090 |
Financing | 85,745 | 97,423 |
Support services | 118,847 | 128,260 |
Business services | 224,519 | 205,346 |
Total revenue | 836,640 | 844,589 |
Costs and expenses: | ||
Cost of equipment sales | 69,562 | 71,539 |
Cost of supplies | 21,471 | 20,690 |
Cost of software | 25,308 | 26,815 |
Cost of rentals | 20,662 | 20,495 |
Financing interest expense | 12,974 | 14,915 |
Cost of support services | 73,354 | 75,249 |
Cost of business services | 150,843 | 135,538 |
Selling, general and administrative | 306,303 | 326,882 |
Research and development | 31,856 | 26,568 |
Restructuring charges and asset impairments, net | 2,082 | 6,933 |
Interest expense, net | 25,676 | 19,301 |
Total costs and expenses | 740,091 | 744,925 |
Income before income taxes | 96,549 | 99,664 |
Provision for income taxes | 31,416 | 37,024 |
Net income | 65,133 | 62,640 |
Less: Preferred stock dividends attributable to noncontrolling interests | 0 | 4,594 |
Net income attributable to Pitney Bowes Inc. | $ 65,133 | $ 58,046 |
Earnings per share attributable to common stockholders: | ||
Basic (in dollars per share) | $ 0.35 | $ 0.30 |
Diluted (in dollars per share) | 0.35 | 0.30 |
Dividends declared per share of common stock (in dollars per share) | $ 0.1875 | $ 0.1875 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 65,133 | $ 62,640 |
Less: Preferred stock dividends attributable to noncontrolling interests | 0 | 4,594 |
Net income attributable to Pitney Bowes Inc. | 65,133 | 58,046 |
Other comprehensive income, net of tax: | ||
Foreign currency translations | 19,915 | 39,849 |
Net unrealized gain (loss) on cash flow hedges, net of tax of $353 and $(18), respectively | 576 | (28) |
Net unrealized gain on investment securities, net of tax of $344 and $2,029, respectively | 585 | 3,454 |
Adjustments to pension and postretirement plans, net of tax of $(304) and $(777), respectively | (1,482) | (1,230) |
Amortization of pension and postretirement costs, net of tax of $3,517 and $3,799, respectively | 6,708 | 6,748 |
Other comprehensive income, net of tax | 26,302 | 48,793 |
Comprehensive income attributable to Pitney Bowes Inc. | $ 91,435 | $ 106,839 |
Condensed Consolidated Stateme4
Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net unrealized gain (loss) on cash flow hedges, tax | $ 353 | $ (18) |
Net unrealized loss on investment securities, tax | 344 | 2,029 |
Adjustments to pension and postretirement plans, tax | (304) | (777) |
Benefit from income tax | $ 3,517 | $ 3,799 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 739,553 | $ 764,522 |
Short-term investments | 43,895 | 38,448 |
Accounts receivable (net of allowance of $14,613 and $14,372, respectively) | 389,990 | 455,527 |
Short-term finance receivables (net of allowance of $13,844 and $13,323, respectively) | 853,390 | 893,950 |
Inventories | 115,638 | 92,726 |
Current income taxes | 11,919 | 11,373 |
Other current assets and prepayments | 78,749 | 68,637 |
Total current assets | 2,233,134 | 2,325,183 |
Property, plant and equipment, net | 319,899 | 314,603 |
Rental property and equipment, net | 178,281 | 188,054 |
Long-term finance receivables (net of allowance of $5,986 and $7,177, respectively) | 664,630 | 673,207 |
Goodwill | 1,583,302 | 1,571,335 |
Intangible assets, net | 159,200 | 165,172 |
Noncurrent income taxes | 78,946 | 74,806 |
Other assets | 529,779 | 524,773 |
Total assets | 5,747,171 | 5,837,133 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 1,317,532 | 1,378,822 |
Current income taxes | 49,933 | 34,434 |
Current portion of long-term debt | 785,287 | 614,485 |
Advance billings | 295,688 | 299,878 |
Total current liabilities | 2,448,440 | 2,327,619 |
Deferred taxes on income | 210,604 | 204,289 |
Tax uncertainties and other income tax liabilities | 61,195 | 61,276 |
Long-term debt | 2,499,025 | 2,750,405 |
Other noncurrent liabilities | 574,245 | 597,204 |
Total liabilities | 5,793,509 | 5,940,793 |
Commitments and contingencies (See Note 12) | ||
Stockholders’ deficit: | ||
Cumulative preferred stock, $50 par value, 4% convertible | 1 | 1 |
Cumulative preference stock, no par value, $2.12 convertible | 478 | 483 |
Common stock, $1 par value (480,000,000 shares authorized; 323,337,912 shares issued) | 323,338 | 323,338 |
Additional paid-in capital | 126,564 | 148,125 |
Retained earnings | 5,138,300 | 5,107,734 |
Accumulated other comprehensive loss | (913,831) | (940,133) |
Treasury stock, at cost (137,029,999 and 137,669,194 shares, respectively) | (4,721,188) | (4,743,208) |
Total Pitney Bowes Inc. stockholders’ deficit | (46,338) | (103,660) |
Total liabilities and stockholders’ deficit | $ 5,747,171 | $ 5,837,133 |
Condensed Consolidated Balance6
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 14,613 | $ 14,372 |
Short-term finance receivables allowance | 13,844 | 13,232 |
Long-term finance receivables allowance | $ 5,986 | $ 7,177 |
Preferred stock par value (in dollars per share) | $ 50 | $ 50 |
Preferred stock dividend rate | 4.00% | 4.00% |
Preference stock, par value (in dollars per share) | $ 0 | $ 0 |
Preference stock dividend rate (in dollars per share) | 2.12 | 2.12 |
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 480,000,000 | 480,000,000 |
Common stock, shares issued (in shares) | 323,337,912 | 323,337,912 |
Treasury stock (in shares) | 137,029,999 | 137,669,194 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities: | ||
Net income | $ 65,133 | $ 62,640 |
Restructuring payments | (12,416) | (21,656) |
Special pension plan contributions | 0 | (36,731) |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Loss on disposal of businesses | 0 | 2,059 |
Depreciation and amortization | 44,295 | 44,300 |
Gain on debt forgiveness | 0 | (10,000) |
Stock-based compensation | 5,638 | 6,303 |
Restructuring charges and asset impairments, net | 2,082 | 6,933 |
Changes in operating assets and liabilities, net of acquisitions/divestitures: | ||
Decrease in accounts receivable | 67,765 | 77,629 |
Decrease in finance receivables | 63,390 | 53,935 |
Increase in inventories | (22,195) | (11,489) |
Increase in other current assets and prepayments | (9,746) | (7,955) |
Decrease in accounts payable and accrued liabilities | (32,829) | (110,067) |
Increase in current and non-current income taxes | 13,542 | 13,380 |
(Decrease) increase in advance billings | (9,194) | 1,289 |
Other, net | (21,459) | (7,077) |
Net cash provided by operating activities | 154,006 | 63,493 |
Cash flows from investing activities: | ||
Purchases of available-for-sale securities | (34,308) | (31,661) |
Proceeds from sales/maturities of available-for-sale securities | 34,396 | 46,209 |
Capital expenditures | (35,920) | (40,670) |
Acquisition of businesses, net of cash acquired | (7,889) | (13,371) |
Change in reserve account deposits | (19,346) | (16,253) |
Other investing activities | (5,803) | (4,786) |
Net cash used in investing activities | (68,870) | (60,532) |
Cash flows from financing activities: | ||
Proceeds from the issuance of long-term debt | 0 | 300,000 |
Principal payments of long-term debt | (79,278) | (370,952) |
Net change in short-term borrowings | 0 | 179,550 |
Dividends paid to stockholders | (34,567) | (36,010) |
Common stock repurchases | 0 | (128,451) |
Other financing activities | (5,658) | (4,962) |
Net cash used in financing activities | (119,503) | (60,825) |
Effect of exchange rate changes on cash and cash equivalents | 9,398 | 19,906 |
Decrease in cash and cash equivalents | (24,969) | (37,958) |
Cash and cash equivalents at beginning of period | 764,522 | 640,190 |
Cash and cash equivalents at end of period | 739,553 | 602,232 |
Cash interest paid | 52,989 | 59,566 |
Cash income tax payments, net of refunds | $ 18,511 | $ 25,585 |
Description of Business and Bas
Description of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | Description of Business and Basis of Presentation Pitney Bowes Inc. (we, us, our, or the company), was incorporated in the state of Delaware in 1920. We are a global technology company offering innovative products and solutions that help our clients navigate the complex world of commerce. We offer products and solutions for customer information management, location intelligence and customer engagement to help our clients market to their customers, and products and solutions for shipping, mailing, and cross border ecommerce that enable the sending of packages across the globe. Clients around the world rely on our products, solutions and services. For more information about us, our products, services and solutions, visit www.pb.com . The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and the instructions to Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In addition, the December 31, 2016 Condensed Consolidated Balance Sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. In management's opinion, all adjustments, consisting only of normal recurring adjustments, considered necessary to fairly state our financial position, results of operations and cash flows for the periods presented have been included. Operating results for the periods presented are not necessarily indicative of the results that may be expected for any other interim period or for the year ending December 31, 2017 . These statements should be read in conjunction with the financial statements and notes thereto included in our Annual Report to Stockholders on Form 10-K for the year ended December 31, 2016 (2016 Annual Report). In the fourth quarter of 2016, we determined that certain investments were classified as cash and cash equivalents. Accordingly, the Condensed Consolidated Statement of Cash Flows for the period ended March 31, 2016 has been revised to reduce beginning cash and cash equivalents by $ 10 million and ending cash and cash equivalents by $11 million with corresponding change to other investing activities. New Accounting Pronouncements - Standards Adopted in 2017 In January 2017, the Financial Accounting Standard Board (FASB) issued Accounting Standard Update (ASU) 2017-04, Intangibles - Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment , which eliminates Step 2 of the current two-step goodwill impairment test and requires only a one-step quantitative impairment test, whereby a goodwill impairment loss will be measured as the excess of a reporting unit’s carrying amount over its fair value (not to exceed the total goodwill allocated to that reporting unit). The ASU is effective for interim and annual periods beginning after December 15, 2019, and is required to be applied prospectively. We elected to early adopt this standard effective January 1, 2017. The adoption of this standard had no impact on our consolidated financial statements or disclosures. In March 2016, the FASB issued ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . The standard includes multiple provisions intended to simplify various aspects of the accounting for share-based payments. We retroactively adopted this ASU effective January 1, 2017. Accordingly, the Condensed Consolidated Statement of Cash Flows as of March 31, 2016 has been recast to increase net cash provided by operating activities and net cash used in financing activities by $5 million . In July 2015, the FASB issued ASU 2015-11, Inventory - Simplifying the Measurement of Inventory , which requires inventory to be measured at the lower of cost and net realizable value (estimated selling price less reasonably predictable costs of completion, disposal and transportation). Inventory measured using the last-in, first-out (LIFO) basis is not impacted by the new guidance. This standard became effective January 1, 2017 and there was no impact on our consolidated financial statements or disclosures. New Accounting Pronouncements - Standards Not Yet Adopted In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Benefit Cost. The ASU requires the service cost component of net periodic benefit cost to be presented in the same income statement line item as other employee compensation costs arising from services rendered during the period. Other components of the net periodic benefit cost are to be presented separately, in an appropriately titled line item outside of any subtotal of operating income or disclosed in the footnotes. The standard also limits the amount eligible for capitalization to the service cost component. The standard is effective for interim and annual periods beginning after December 15, 2017 and we are currently assessing the impact this standard will have on our consolidated financial statements. In January 2017, the FASB issued ASU 2017-06 – Plan Accounting: Defined Benefit Pension Plans (Topic 960); Defined Contribution Pension Plans (Topic 962); Health and Welfare Benefit Plans (Topic 965): Employee Benefit Plan Master Trust Reporting . The ASU requires separate disclosure in the statement of net assets available for benefits and the statement of changes in net assets available for benefits of changes in any interests held in a Master Trust and other enhanced disclosures. The standard is effective for interim and annual periods beginning after December 15, 2018 and we are currently evaluating the impact of this standard on our consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business, which clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The standard is effective for interim and annual periods beginning after December 15, 2017. The impact on our consolidated financial statements will depend on the facts and circumstances of any specific future transactions. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes: Inter-entity Transfers of Assets other than Inventory, which requires tax expense to be recognized from the sale of intra-entity assets, other than inventory, when the transfer occurs, even though the effects of the transaction are eliminated in consolidation. Under current guidance, the tax effects of transfers are deferred until the transferred asset is sold or otherwise recovered through use. The standard is effective for interim and annual periods beginning after December 15, 2017 and early adoption is permitted, including adoption during an interim period. We are currently assessing the impact this standard will have on our consolidated financial statements. In August, 2016, the FASB issued ASU No. 2016-15, Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force). The ASU is intended to reduce diversity in practice in the presentation and classification of certain cash receipts and cash payments by providing guidance on eight specific cash flow issues. The ASU is effective for interim and annual periods beginning after December 15, 2017 and early adoption is permitted, including adoption during an interim period. We are currently assessing the impact this standard will have on our consolidated statement of cash flows. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses . The ASU sets forth a “current expected credit loss” (CECL) model which requires companies to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost and applies to some off-balance sheet credit exposures. This standard is effective for interim and annual periods beginning after December 15, 2019. We are currently assessing the impact this standard will have on our consolidated financial statements and disclosures. In February 2016, the FASB issued ASU 2016-02, Leases. This standard, among other things, will require lessees to recognize almost all leases on their balance sheet as a right-of-use asset and a lease liability and result in enhanced disclosures. The standard is effective for interim and annual periods beginning after December 15, 2018 and early adoption is permitted. We are currently assessing the impact this standard will have on our consolidated financial statements and disclosures. In January 2016, the FASB issued ASU 2016-01, Financial Instruments–Overall: Recognition and Measurement of Financial Assets and Financial Liabilities . This standard primarily affects the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. The standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted. We are currently assessing the impact this standard will have on our consolidated financial statements and disclosures. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , which requires companies to recognize revenue for the transfer of goods and services to customers in amounts that reflect the consideration the company expects to receive in exchange for those goods and services. In addition, the standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue. There were several amendments to the standard during 2016, including clarification of the accounting for licenses of intellectual property and identifying performance obligations. The standard is effective beginning January 1, 2018 and can be adopted either retrospectively to each reporting period presented or on a modified retrospective basis with a cumulative effect adjustment at the date of the initial application. We plan to adopt the standard retrospectively with a cumulative effect adjustment. We are continuing to assess all potential impacts of the standard across all of our business segments and believe that the most significant impact will be in our Software Solutions segment related to the timing of software licenses and certain other ancillary revenue streams. In addition, we currently capitalize certain costs associated with the acquisition of new customers and recognize these costs over their expected revenue stream of eight years. Under the new standard, these costs will be expensed as incurred. Also, we are continuing to review our sales commission plans to determine which payments may be capitalized. We plan to use the practical expedient that allows companies to expense costs to obtain a contract when the estimated amortization period is less than one year. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Effective January 1, 2017, we revised our segment reporting to reflect a change in how we manage and report office shipping solutions, which were previously reported within the Global Ecommerce segment. The needs of retail and ecommerce clients are different from those of office shipping clients. Accordingly, the results for office shipping solutions are now reported within Small & Medium Business Solutions and the retail and ecommerce shipping solutions remain in Global Ecommerce. Prior period results have been recast to conform to our current segment presentation. The principal products and services of each of our reportable segments are as follows: Small & Medium Business Solutions: North America Mailing : Includes the revenue and related expenses from mailing and office shipping solutions, financing services, and supplies for small and medium businesses to efficiently create physical and digital mail, evidence postage and help simplify and save on the sending, tracking and receiving of letters, parcels and flats in the U.S. and Canada. International Mailing : Includes the revenue and related expenses from mailing and office shipping solutions, financing services, and supplies for small and medium businesses to efficiently create physical and digital mail, evidence postage and help simplify and save on the sending, tracking and receiving of letters, parcels and flats in areas outside the U.S. and Canada. Enterprise Business Solutions: Production Mail: Includes the worldwide revenue and related expenses from the sale of production mail inserting and sortation equipment, high-speed production print systems, supplies and related support services to large enterprise clients to process inbound and outbound mail. Presort Services : Includes revenue and related expenses from presort mail and parcel services for our large enterprise clients to qualify large mail volumes for postal worksharing discounts. Digital Commerce Solutions: Software Solutions: Includes the worldwide revenue and related expenses from the licensing of customer engagement, customer information and location intelligence software solutions and related support services. Global Ecommerce: Includes the worldwide revenue and related expenses from cross-border ecommerce transactions and domestic retail and ecommerce shipping solutions. We determine segment earnings before interest and taxes (EBIT) by deducting from segment revenue the related costs and expenses attributable to the segment. Segment EBIT excludes interest, taxes, general corporate expenses, restructuring charges, and other items that are not allocated to a particular business segment. Management uses segment EBIT to measure profitability and performance at the segment level and believes that it provides a useful measure of operating performance and underlying trends of the businesses. Segment EBIT may not be indicative of our overall consolidated performance and therefore, should be read in conjunction with our consolidated results of operations. Revenue and EBIT by business segment is presented below: Revenue Three Months Ended March 31, 2017 2016 North America Mailing $ 355,578 $ 371,453 International Mailing 93,058 104,986 Small & Medium Business Solutions 448,636 476,439 Production Mail 88,955 87,425 Presort Services 132,677 127,396 Enterprise Business Solutions 221,632 214,821 Software Solutions 78,220 77,922 Global Ecommerce 88,152 75,407 Digital Commerce Solutions 166,372 153,329 Total revenue $ 836,640 $ 844,589 EBIT Three Months Ended March 31, 2017 2016 North America Mailing $ 141,008 $ 160,831 International Mailing 13,269 11,176 Small & Medium Business Solutions 154,277 172,007 Production Mail 8,964 6,824 Presort Services 30,717 28,910 Enterprise Business Solutions 39,681 35,734 Software Solutions 2,749 (2,572 ) Global Ecommerce (4,270 ) (3,469 ) Digital Commerce Solutions (1,521 ) (6,041 ) Total segment EBIT 192,437 201,700 Reconciling items: Interest, net (38,650 ) (34,216 ) Unallocated corporate expenses (55,156 ) (57,767 ) Restructuring charges and asset impairments, net (2,082 ) (6,933 ) Acquisition and disposition-related expenses — (3,120 ) Income before income taxes 96,549 99,664 Provision for income taxes 31,416 37,024 Net income $ 65,133 $ 62,640 |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share The calculations of basic and diluted earnings per share are presented below. Three Months Ended March 31, 2017 2016 Numerator: Amounts attributable to common stockholders: Net income attributable to Pitney Bowes Inc. (numerator for diluted EPS) $ 65,133 $ 58,046 Less: Preference stock dividend 9 10 Income attributable to common stockholders (numerator for basic EPS) $ 65,124 $ 58,036 Denominator: Weighted-average shares used in basic EPS 185,982 192,241 Effect of dilutive shares: Conversion of Preferred stock and Preference stock 293 304 Employee stock plans 600 636 Weighted-average shares used in diluted EPS 186,875 193,181 Basic earnings per share $ 0.35 $ 0.30 Diluted earnings per share $ 0.35 $ 0.30 Anti-dilutive shares not used in calculating diluted weighted-average shares 11,176 8,870 |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value. Cost is determined on the last-in, last-out (LIFO) basis for most U.S. inventories and the first-in, first-out (FIFO) basis for most non-U.S. inventories. Inventories at March 31, 2017 and December 31, 2016 consisted of the following: March 31, December 31, Raw materials $ 35,499 $ 28,541 Work in process 5,994 6,498 Supplies and service parts 49,729 45,152 Finished products 36,559 24,678 Inventory at FIFO cost 127,781 104,869 Excess of FIFO cost over LIFO cost (12,143 ) (12,143 ) Total inventory, net $ 115,638 $ 92,726 |
Finance Assets
Finance Assets | 3 Months Ended |
Mar. 31, 2017 | |
Receivables [Abstract] | |
Finance Assets | Finance Assets Finance Receivables Finance receivables are comprised of sales-type lease receivables and unsecured revolving loan receivables. Sales-type lease receivables are generally due in monthly, quarterly or semi-annual installments over periods ranging from three to five years. Loan receivables arise primarily from financing services offered to our customers for postage and supplies. Loan receivables are generally due each month; however, customers may rollover outstanding balances. Interest is recognized on loan receivables using the effective interest method and related annual fees are initially deferred and recognized ratably over the annual period covered. Customer acquisition costs are expensed as incurred. Finance receivables at March 31, 2017 and December 31, 2016 consisted of the following: March 31, 2017 December 31, 2016 North America International Total North America International Total Sales-type lease receivables Gross finance receivables $ 1,073,533 $ 266,437 $ 1,339,970 $ 1,088,053 $ 273,262 $ 1,361,315 Unguaranteed residual values 89,292 13,543 102,835 90,190 13,655 103,845 Unearned income (220,515 ) (61,056 ) (281,571 ) (223,908 ) (60,458 ) (284,366 ) Allowance for credit losses (8,816 ) (2,569 ) (11,385 ) (8,247 ) (2,647 ) (10,894 ) Net investment in sales-type lease receivables 933,494 216,355 1,149,849 946,088 223,812 1,169,900 Loan receivables Loan receivables 342,037 34,579 376,616 374,147 32,716 406,863 Allowance for credit losses (7,369 ) (1,076 ) (8,445 ) (8,517 ) (1,089 ) (9,606 ) Net investment in loan receivables 334,668 33,503 368,171 365,630 31,627 397,257 Net investment in finance receivables $ 1,268,162 $ 249,858 $ 1,518,020 $ 1,311,718 $ 255,439 $ 1,567,157 Allowance for Credit Losses We provide an allowance for probable credit losses based on historical loss experience, the nature and volume of our portfolios, adverse situations that may affect a client's ability to pay, prevailing economic conditions and our ability to manage the collateral. We continually evaluate the adequacy of the allowance for credit losses and make adjustments as necessary. The assumptions used in determining an estimate of credit losses are inherently subjective and actual results may differ significantly from estimated reserves. We establish credit approval limits based on the credit quality of the client and the type of equipment financed. Our policy is to discontinue revenue recognition for lease receivables that are more than 120 days past due and for loan receivables that are more than 90 days past due. We resume revenue recognition when the client's payments reduce the account aging to less than 60 days past due. Finance receivables deemed uncollectible are written off against the allowance after all collection efforts have been exhausted and management deems the account to be uncollectible. We believe that our finance receivable credit risk is low because of the geographic and industry diversification of our clients and small account balances for most of our clients. Activity in the allowance for credit losses for the three months ended March 31, 2017 and 2016 was as follows: Sales-type Lease Receivables Loan Receivables North America International North America International Total Balance at January 1, 2017 $ 8,247 $ 2,647 $ 8,517 $ 1,089 $ 20,500 Amounts charged to expense 1,758 178 639 144 2,719 Write-offs and other (1,189 ) (256 ) (1,787 ) (157 ) (3,389 ) Balance at March 31, 2017 $ 8,816 $ 2,569 $ 7,369 $ 1,076 $ 19,830 Sales-type Lease Receivables Loan Receivables North America International North America International Total Balance at January 1, 2016 $ 6,606 $ 3,542 $ 10,024 $ 1,518 $ 21,690 Amounts charged to expense 995 50 1,300 157 2,502 Write-offs and other (1,705 ) (495 ) (2,138 ) (123 ) (4,461 ) Balance at March 31, 2016 $ 5,896 $ 3,097 $ 9,186 $ 1,552 $ 19,731 Aging of Receivables The aging of gross finance receivables at March 31, 2017 and December 31, 2016 was as follows: March 31, 2017 Sales-type Lease Receivables Loan Receivables North America International North America International Total 1 - 90 days $ 1,004,804 $ 262,172 $ 333,362 $ 34,251 $ 1,634,589 > 90 days 68,729 4,265 8,675 328 81,997 Total $ 1,073,533 $ 266,437 $ 342,037 $ 34,579 $ 1,716,586 Past due amounts > 90 days Still accruing interest $ 12,104 $ 1,192 $ — $ — $ 13,296 Not accruing interest 56,625 3,073 8,675 328 68,701 Total $ 68,729 $ 4,265 $ 8,675 $ 328 $ 81,997 As of March 31, 2017, we had North America sales-type lease receivables aged greater than 90 days with a contract value of $69 million . As of April 28, 2017, we received payments with a contract value of approximately $26 million related to these receivables. December 31, 2016 Sales-type Lease Receivables Loan Receivables North America International North America International Total 1 - 90 days $ 1,025,313 $ 269,247 $ 366,726 $ 32,420 $ 1,693,706 > 90 days 62,740 4,015 7,421 296 74,472 Total $ 1,088,053 $ 273,262 $ 374,147 $ 32,716 $ 1,768,178 Past due amounts > 90 days Still accruing interest $ 8,831 $ 972 $ — $ — $ 9,803 Not accruing interest 53,909 3,043 7,421 296 64,669 Total $ 62,740 $ 4,015 $ 7,421 $ 296 $ 74,472 Credit Quality The extension of credit and management of credit lines to new and existing clients uses a combination of an automated credit score, where available, and a detailed manual review of the client's financial condition and, when applicable, payment history. Once credit is granted, the payment performance of the client is managed through automated collections processes and is supplemented with direct follow up should an account become delinquent. We have robust automated collections and extensive portfolio management processes. The portfolio management processes ensure that our global strategy is executed, collection resources are allocated appropriately and enhanced tools and processes are implemented as needed. We use a third party to score the majority of the North America portfolio on a quarterly basis using a commercial credit score. We do not use a third party to score our International portfolio because the cost to do so is prohibitive, given that it is a localized process and there is no single credit score model that covers all countries. The table below shows the North America portfolio at March 31, 2017 and December 31, 2016 by relative risk class based on the relative scores of the accounts within each class. The relative scores are determined based on a number of factors, including the company type, ownership structure, payment history and financial information. A fourth class is shown for accounts that are not scored. Absence of a score is not indicative of the credit quality of the account. The degree of risk (low, medium, high), as defined by the third party, refers to the relative risk that an account in the next 12 month period may become delinquent. • Low risk accounts are companies with very good credit scores and are considered to approximate the top 30% of all commercial borrowers. • Medium risk accounts are companies with average to good credit scores and are considered to approximate the middle 40% of all commercial borrowers. • High risk accounts are companies with poor credit scores, are delinquent or are at risk of becoming delinquent and are considered to approximate the bottom 30% of all commercial borrowers. March 31, December 31, Sales-type lease receivables Low $ 865,202 $ 879,823 Medium 137,624 135,953 High 22,202 22,600 Not Scored 48,505 49,677 Total $ 1,073,533 $ 1,088,053 Loan receivables Low $ 265,626 $ 296,598 Medium 54,164 53,647 High 6,078 7,216 Not Scored 16,169 16,686 Total $ 342,037 $ 374,147 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | Intangible Assets and Goodwill Intangible Assets Intangible assets at March 31, 2017 and December 31, 2016 consisted of the following: March 31, 2017 December 31, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 447,830 $ (308,756 ) $ 139,074 $ 445,039 $ (300,906 ) $ 144,133 Software & technology 150,748 (137,693 ) 13,055 150,037 (136,508 ) 13,529 Trademarks & other 36,372 (29,301 ) 7,071 36,212 (28,702 ) 7,510 Total intangible assets $ 634,950 $ (475,750 ) $ 159,200 $ 631,288 $ (466,116 ) $ 165,172 Amortization expense was $8 million and $11 million for the three months ended March 31, 2017 and 2016 , respectively. Future amortization expense as of March 31, 2017 was as follows: Remaining for year ending December 31, 2017 $ 21,768 Year ending December 31, 2018 27,455 Year ending December 31, 2019 24,079 Year ending December 31, 2020 18,904 Year ending December 31, 2021 15,301 Thereafter 51,693 Total $ 159,200 Actual amortization expense may differ from the amounts above due to, among other things, fluctuations in foreign currency exchange rates, impairments, acquisitions and accelerated amortization. Goodwill Changes in the carrying value of goodwill, by reporting segment, for the three months ended March 31, 2017 are shown in the table below. Prior year amounts have been recast for the change in reportable segments. December 31, 2016 Acquisitions Foreign currency translation March 31, North America Mailing $ 354,000 $ — $ 1,402 $ 355,402 International Mailing 145,566 — 1,587 147,153 Small & Medium Business Solutions 499,566 — 2,989 502,555 Production Mail 101,099 — 766 101,865 Presort Services 196,890 6,229 — 203,119 Enterprise Business Solutions 297,989 6,229 766 304,984 Software Solutions 501,591 — 1,983 503,574 Global Ecommerce 272,189 — — 272,189 Digital Commerce Solutions 773,780 — 1,983 775,763 Total goodwill $ 1,571,335 $ 6,229 $ 5,738 $ 1,583,302 |
Fair Value Measurements and Der
Fair Value Measurements and Derivative Instruments | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements and Derivative Instruments | Fair Value Measurements and Derivative Instruments We measure certain financial assets and liabilities at fair value on a recurring basis. Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. An entity is required to classify certain assets and liabilities measured at fair value based on the following fair value hierarchy that prioritizes the inputs used to measure fair value: Level 1 – Unadjusted quoted prices in active markets for identical assets and liabilities. Level 2 – Quoted prices for identical assets and liabilities in markets that are not active, quoted prices for similar assets and liabilities in active markets or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Unobservable inputs that are supported by little or no market activity, may be derived from internally developed methodologies based on management’s best estimate of fair value and that are significant to the fair value of the asset or liability. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect its placement within the fair value hierarchy. The following tables show, by level within the fair value hierarchy, our financial assets and liabilities that are accounted for at fair value on a recurring basis at March 31, 2017 and December 31, 2016 . March 31, 2017 Level 1 Level 2 Level 3 Total Assets: Investment securities Money market funds / commercial paper $ 121,807 $ 255,169 $ — $ 376,976 Equity securities — 23,432 — 23,432 Commingled fixed income securities 1,543 21,598 — 23,141 Debt securities - U.S. and foreign governments, agencies and municipalities 111,144 22,126 — 133,270 Debt securities - corporate — 71,093 — 71,093 Mortgage-backed / asset-backed securities — 158,681 — 158,681 Derivatives Interest rate swap — 2,056 — 2,056 Foreign exchange contracts — 889 — 889 Total assets $ 234,494 $ 555,044 $ — $ 789,538 Liabilities: Derivatives Foreign exchange contracts $ — $ (263 ) $ — $ (263 ) Total liabilities $ — $ (263 ) $ — $ (263 ) December 31, 2016 Level 1 Level 2 Level 3 Total Assets: Investment securities Money market funds / commercial paper $ 114,471 $ 217,175 $ — $ 331,646 Equity securities — 24,571 — 24,571 Commingled fixed income securities 1,536 22,132 — 23,668 Debt securities - U.S. and foreign governments, agencies and municipalities 116,822 19,358 — 136,180 Debt securities - corporate — 69,891 — 69,891 Mortgage-backed / asset-backed securities — 158,996 — 158,996 Derivatives Interest rate swap — 1,588 — 1,588 Foreign exchange contracts — 637 — 637 Total assets $ 232,829 $ 514,348 $ — $ 747,177 Liabilities: Derivatives Foreign exchange contracts $ — $ (3,717 ) $ — $ (3,717 ) Total liabilities $ — $ (3,717 ) $ — $ (3,717 ) Investment Securities The valuation of investment securities is based on the market approach using inputs that are observable, or can be corroborated by observable data, in an active marketplace. The following information relates to our classification into the fair value hierarchy: • Money Market Funds / Commercial Paper: Money market funds typically invest in government securities, certificates of deposit, commercial paper and other highly liquid, low risk securities. Money market funds are principally used for overnight deposits and are classified as Level 1 when unadjusted quoted prices in active markets are available and as Level 2 when they are not actively traded on an exchange. Direct investments in commercial paper are not listed on an exchange in an active market and are classified as Level 2. • Equity Securities: Equity securities are comprised of mutual funds investing in U.S. and foreign common stock. These mutual funds are classified as Level 2 as they are not separately listed on an exchange. • Commingled Fixed Income Securities: Mutual funds that invest in a variety of fixed-income securities including securities of the U.S. government and its agencies, corporate debt, mortgage-backed securities and asset-backed securities. The value of the funds is based on the market value of the underlying investments owned by each fund, minus its liabilities, divided by the number of shares outstanding, as reported by the fund manager. These commingled funds are not listed on an exchange in an active market and are classified as Level 2. • Debt Securities – U.S. and Foreign Governments, Agencies and Municipalities: Debt securities are classified as Level 1 where active, high volume trades for identical securities exist. Valuation adjustments are not applied to these securities. Debt securities valued using quoted market prices for similar securities or benchmarking model derived prices to quoted market prices and trade data for identical or comparable securities are classified as Level 2. • Debt Securities – Corporate: Corporate debt securities are valued using recently executed transactions, market price quotations where observable, or bond spreads. The spread data used are for the same maturity as the security. These securities are classified as Level 2. • Mortgage-Backed Securities / Asset-Backed Securities: These securities are valued based on external pricing indices. When external index pricing is not observable, these securities are valued based on external price/spread data. These securities are classified as Level 2. Investment securities include investments held by The Pitney Bowes Bank (the Bank), whose primary business is to provide financing solutions to clients that rent postage meters and purchase supplies. The Bank's assets and liabilities consist primarily of cash, finance receivables, short and long-term investments and deposit accounts. Available-For-Sale Securities Certain investment securities are classified as available-for-sale and recorded at fair value in the Condensed Consolidated Balance Sheets as cash and cash equivalents, short-term investments and other assets depending on the type of investment and maturity. Unrealized holding gains and losses are recorded, net of tax, in accumulated other comprehensive income (AOCI). Available-for-sale securities at March 31, 2017 and December 31, 2016 consisted of the following: March 31, 2017 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value U.S. and foreign governments, agencies and municipalities $ 125,151 $ 1,694 $ (1,473 ) $ 125,372 Corporate notes and bonds 70,302 1,312 (521 ) 71,093 Commingled fixed income securities 1,576 — (33 ) 1,543 Mortgage-backed / asset-backed securities 158,718 1,583 (1,620 ) 158,681 Total $ 355,747 $ 4,589 $ (3,647 ) $ 356,689 December 31, 2016 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value U.S. and foreign governments, agencies and municipalities $ 136,316 $ 1,571 $ (1,707 ) $ 136,180 Corporate notes and bonds 69,376 1,180 (665 ) 69,891 Commingled fixed income securities 1,568 — (32 ) 1,536 Mortgage-backed / asset-backed securities 159,312 1,566 (1,882 ) 158,996 Total $ 366,572 $ 4,317 $ (4,286 ) $ 366,603 At March 31, 2017 , investment securities that were in a loss position for 12 or more continuous months had aggregate unrealized holding losses of less than $1 million and an estimated fair value of $7 million , and investment securities that were in a loss position for less than 12 continuous months had aggregate unrealized holding losses of $3 million and an estimated fair value of $166 million . At December 31, 2016 , investment securities that were in a loss position for 12 or more continuous months had aggregate unrealized holding losses of less than $1 million and an estimated fair value of $12 million , and investment securities that were in a loss position for less than 12 continuous months had aggregate unrealized holding losses of $4 million and an estimated fair value of $171 million . We have not recognized an other-than-temporary impairment on any of the investment securities in an unrealized loss position because we have the ability and intent to hold these securities until recovery of the unrealized losses and we expect to receive the contractual principal and interest on these investment securities at maturity. Scheduled maturities of available-for-sale securities at March 31, 2017 were as follows: Amortized cost Estimated fair value Within 1 year $ 29,886 $ 29,936 After 1 year through 5 years 106,796 107,300 After 5 years through 10 years 63,107 63,339 After 10 years 155,958 156,114 Total $ 355,747 $ 356,689 The expected payments on mortgage-backed and asset-backed securities may not coincide with their contractual maturities as borrowers have the right to prepay obligations with or without prepayment penalties. We have not experienced any significant write-offs in our investment portfolio. The majority of our mortgage-backed securities are either guaranteed or supported by the U.S. Government. We have no investments in inactive markets that would warrant a possible change in our pricing methods or classification within the fair value hierarchy. Derivative Instruments In the normal course of business, we are exposed to the impact of changes in foreign currency exchange rates and interest rates. We limit these risks by following established risk management policies and procedures, including the use of derivatives. We use derivative instruments to limit the effects of exchange rate fluctuations on financial results and manage the related cost of debt. We do not use derivatives for trading or speculative purposes. We record derivative instruments at fair value and the accounting for changes in the fair value 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. Foreign Exchange Contracts We enter into foreign exchange contracts to mitigate the currency risk associated with the anticipated purchase of inventory between affiliates and from third parties. These contracts are designated as cash flow hedges. The effective portion of the gain or loss on cash flow hedges is included in AOCI in the period that the change in fair value occurs and is reclassified to earnings in the period that the hedged item is recorded in earnings. At March 31, 2017 and December 31, 2016 , we had outstanding contracts associated with these anticipated transactions with notional amounts of $12 million and $13 million , respectively. The valuation of foreign exchange derivatives is based on the market approach using observable market inputs, such as foreign currency spot and forward rates and yield curves. We also incorporate counterparty credit risk and our credit risk into the fair value measurement of our derivative assets and liabilities, respectively. We derive credit risk from observable data in the credit default swap market. We have not seen a material change in the creditworthiness of those banks acting as derivative counterparties. Interest Rate Swap We entered into an interest rate swap with a notional amount of $300 million to mitigate the interest rate risk associated with our $300 million variable-rate term loans. The swap is designated as a cash flow hedge. The effective portion of the gain or loss on the cash flow hedge is included in AOCI in the period that the change in fair value occurs and is reclassified to earnings in the period that the hedged item is recorded in earnings. Under the terms of the swap agreement, we pay fixed-rate interest of 0.8826% and receive variable-rate interest based on 1-month LIBOR. The variable interest rate resets monthly. The valuation of our interest rate swap is based on the income approach using a model with inputs that are observable or that can be derived from or corroborated by observable market data. The fair value of derivative instruments at March 31, 2017 and December 31, 2016 was as follows: Designation of Derivatives Balance Sheet Location March 31, December 31, Derivatives designated as hedging instruments Foreign exchange contracts Other current assets and prepayments $ 353 $ 487 Accounts payable and accrued liabilities (35 ) (136 ) Interest Rate Swap Other assets 2,056 1,588 Derivatives not designated as hedging instruments Foreign exchange contracts Other current assets and prepayments 536 150 Accounts payable and accrued liabilities (228 ) (3,581 ) Total derivative assets $ 2,945 $ 2,225 Total derivative liabilities (263 ) (3,717 ) Total net derivative asset (liabilities) $ 2,682 $ (1,492 ) The majority of the amounts included in AOCI at March 31, 2017 will be recognized in earnings within the next 12 months. No amount of ineffectiveness was recorded in earnings for these designated cash flow hedges. The following represents the results of cash flow hedging relationships for the three months ended March 31, 2017 and 2016 : Three Months Ended March 31, Derivative Gain (Loss) Recognized in AOCI (Effective Portion) Location of Gain (Loss) (Effective Portion) Gain (Loss) Reclassified from AOCI to Earnings (Effective Portion) Derivative Instrument 2017 2016 2017 2016 Foreign exchange contracts $ 50 $ (393 ) Revenue $ (28 ) (380 ) Cost of sales 111 225 Interest rate swap 468 — Interest Expense — — $ 518 $ (393 ) $ 83 $ (155 ) We also enter into foreign exchange contracts to minimize the impact of exchange rate fluctuations on short-term intercompany loans and related interest that are denominated in a foreign currency. The revaluation of the intercompany loans and interest and the mark-to-market adjustment on the derivatives are both recorded in earnings. All outstanding contracts at March 31, 2017 mature within 12 months. The following represents the results of our non-designated derivative instruments for the three months ended March 31, 2017 and 2016 : Three Months Ended March 31, Derivative Gain (Loss) Recognized in Earnings Derivatives Instrument Location of Derivative Gain (Loss) 2017 2016 Foreign exchange contracts Selling, general and administrative expense $ (1,849 ) $ (5,977 ) Credit-Risk-Related Contingent Features Certain derivative instruments contain credit-risk-related contingent features that would require us to post collateral based on a combination of our long-term senior unsecured debt ratings and the net fair value of our derivatives. At March 31, 2017 , we did not post any collateral and the maximum amount of collateral that we would have been required to post had the credit-risk-related contingent features been triggered was not significant. Fair Value of Financial Instruments Our financial instruments include cash and cash equivalents, investment securities, accounts receivable, loan receivables, derivative instruments, accounts payable and debt. The carrying value for cash and cash equivalents, accounts receivable, loans receivable, and accounts payable approximate fair value because of the short maturity of these instruments. The fair value of our debt is estimated based on recently executed transactions and market price quotations. The inputs used to determine the fair value of our debt were classified as Level 2 in the fair value hierarchy. The carrying value and estimated fair value of our debt at March 31, 2017 and December 31, 2016 were as follows: March 31, 2017 December 31, 2016 Carrying value $ 3,284,312 $ 3,364,890 Fair value $ 3,341,434 $ 3,412,581 |
Restructuring Charges
Restructuring Charges | 3 Months Ended |
Mar. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | Restructuring Charges Activity in our restructuring reserves for the three months ended March 31, 2017 and 2016 was as follows: Severance and benefits costs Other exit costs Total Balance at January 1, 2017 $ 28,376 $ 281 $ 28,657 Expenses, net 1,419 67 1,486 Cash payments (12,294 ) (122 ) (12,416 ) Balance at March 31, 2017 $ 17,501 $ 226 $ 17,727 Balance at January 1, 2016 $ 43,700 $ 3,722 $ 47,422 Expenses, net 4,590 1,060 5,650 Cash payments (19,956 ) (1,700 ) (21,656 ) Balance at March 31, 2016 $ 28,334 $ 3,082 $ 31,416 The majority of the remaining restructuring reserves are expected to be paid over the next 12 to 24 months; however, due to certain international labor laws and long-term lease agreements, some payments will extend beyond 24 months. We expect to fund these payments from cash flows from operations. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt | Debt Total debt at March 31, 2017 and December 31, 2016 consisted of the following: Interest rate March 31, 2017 December 31, 2016 Notes due September 2017 5.75% $ 385,109 $ 385,109 Notes due March 2018 5.6% 250,000 250,000 Notes due May 2018 4.75% 350,000 350,000 Notes due March 2019 6.25% 300,000 300,000 Notes due October 2021 3.375% 600,000 600,000 Notes due March 2024 4.625% 500,000 500,000 Notes due January 2037 5.25% 35,841 115,041 Notes due March 2043 6.7% 425,000 425,000 Term loans Variable 450,000 450,000 Other debt 5,584 5,677 Principal amount 3,301,534 3,380,827 Less: unamortized debt discount and issuance costs 27,600 28,796 Plus: unamortized interest rate swap proceeds 10,378 12,859 Total debt 3,284,312 3,364,890 Less: current portion long-term debt 785,287 614,485 Long-term debt $ 2,499,025 $ 2,750,405 In January 2017, bondholders of the 5.25% Notes due 2037 caused us to redeem $79 million of the debt outstanding. |
Pensions and Other Benefit Prog
Pensions and Other Benefit Programs | 3 Months Ended |
Mar. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
Pensions and Other Benefit Programs | Pensions and Other Benefit Programs The components of net periodic benefit cost (income) were as follows: Defined Benefit Pension Plans Nonpension Postretirement Benefit Plans United States Foreign Three Months Ended Three Months Ended Three Months Ended March 31, March 31, March 31, 2017 2016 2017 2016 2017 2016 Service cost $ 30 $ 32 $ 542 $ 527 $ 419 $ 501 Interest cost 17,244 18,830 4,544 5,661 1,771 2,136 Expected return on plan assets (24,548 ) (25,589 ) (7,780 ) (8,472 ) — — Amortization of transition credit — — (2 ) (2 ) — — Amortization of prior service (credit) cost (15 ) (15 ) (18 ) (17 ) 74 74 Amortization of net actuarial loss 7,268 6,706 2,034 1,343 884 1,360 Settlement (1) — 1,098 — — — — Net periodic benefit cost (income) $ (21 ) $ 1,062 $ (680 ) $ (960 ) $ 3,148 $ 4,071 (1) Included in restructuring charges and asset impairments, net in the Condensed Consolidated Statements of Income. Through March 31, 2017 and 2016, contributions to our U.S. pension plans were $2 million and $4 million , respectively, and contributions to our foreign plans were $9 million and $38 million , respectively. Nonpension postretirement benefit plan contributions were $5 million and $4 million through March 31, 2017 and March 31, 2016 , respectively. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The effective tax rate for the three months ended March 31, 2017 and 2016 was 32.5% and 37.1% , respectively. The effective tax rate for the three months ended March 31, 2017 and 2016 includes a $4 million and $3 million charge, respectively, from the write-off of deferred tax assets associated with expiration of out-of-the-money vested stock options and the vesting of restricted stock. The effective tax rate for the three months ended March 31, 2017 also includes a $4 million benefit from the resolution of tax examinations. As is the case with other large corporations, our tax returns are examined each year by tax authorities in the U.S. and other global taxing jurisdictions in which we have operations. As a result, it is reasonably possible that the amount of our unrecognized tax benefits will decrease in the next 12 months, and we expect this change could be up to 25% of our unrecognized tax benefits. The IRS examinations of our consolidated U.S. income tax returns for tax years prior to 2012 are closed to audit; however, various post-2006 U.S. state and local tax returns are still subject to examination. In Canada, the examination of our tax filings prior to 2011 are closed to audit, except for the pending application of legal principles to specific issues arising in earlier years. Other significant jurisdictions include France, which is closed to audit through the end of 2012, Germany, which is closed to audit through the end of 2011 and the U.K., which, except for an item under appeal, is closed to audit through the end of 2011. We have other less significant tax fillings currently subject to examination. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies 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 clients; 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. In management's opinion, the potential liability, if any, that may result from these actions, either individually or collectively, is not reasonably expected to have a material effect on our financial position, results of operations or cash flows. However, as litigation is inherently unpredictable, there can be no assurances in this regard. |
Stockholders' (Deficit) Equity
Stockholders' (Deficit) Equity | 3 Months Ended |
Mar. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' (Deficit) Equity | Stockholders’ (Deficit) Equity Changes in stockholders’ (deficit) equity for the three months ended March 31, 2017 and 2016 were as follows: Preferred stock Preference stock Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive loss Treasury stock Total deficit Balance at January 1, 2017 $ 1 $ 483 $ 323,338 $ 148,125 $ 5,107,734 $ (940,133 ) $ (4,743,208 ) $ (103,660 ) Net income — — — — 65,133 — — 65,133 Other comprehensive income — — — — — 26,302 — 26,302 Dividends paid — — — — (34,567 ) — — (34,567 ) Issuance of common stock — — — (27,098 ) — — 21,914 (5,184 ) Conversion to common stock — (5 ) — (101 ) — — 106 — Stock-based compensation expense — — — 5,638 — — — 5,638 Balance at March 31, 2017 $ 1 $ 478 $ 323,338 $ 126,564 $ 5,138,300 $ (913,831 ) $ (4,721,188 ) $ (46,338 ) Preferred stock Preference stock Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive loss Treasury stock Total equity Balance at January 1, 2016 $ 1 $ 505 $ 323,338 $ 161,280 $ 5,155,537 $ (888,635 ) $ (4,573,305 ) $ 178,721 Net income — — — — 58,046 — — 58,046 Other comprehensive loss — — — — — 48,793 — 48,793 Dividends paid — — — — (36,010 ) — — (36,010 ) Issuance of common stock — — — (21,555 ) — — 17,421 (4,134 ) Conversion to common stock — (13 ) — (273 ) — — 286 — Stock-based compensation expense — — — 6,303 — — — 6,303 Repurchase of common stock — — — — — — (128,451 ) (128,451 ) Balance at March 31, 2016 $ 1 $ 492 $ 323,338 $ 145,755 $ 5,177,573 $ (839,842 ) $ (4,684,049 ) $ 123,268 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) Reclassifications out of AOCI for the three months ended March 31, 2017 and 2016 were as follows: Amount Reclassified from AOCI (a) Three Months Ended March 31, 2017 2016 Gains (losses) on cash flow hedges Revenue $ 28 $ (380 ) Cost of sales (111 ) 225 Interest expense, net (507 ) (507 ) Total before tax (590 ) (662 ) Benefit for income tax (230 ) (258 ) Net of tax $ (360 ) $ (404 ) Gains (losses) on available for sale securities Interest expense, net $ (109 ) $ 18 (Benefit) provision for income tax (40 ) 7 Net of tax $ (69 ) $ 11 Pension and Postretirement Benefit Plans (b) Transition credit $ 2 $ 2 Prior service costs (41 ) (42 ) Actuarial losses (10,186 ) (9,409 ) Settlements — (1,098 ) Total before tax (10,225 ) (10,547 ) Benefit from income tax (3,517 ) (3,799 ) Net of tax $ (6,708 ) $ (6,748 ) (a) Amounts in parentheses indicate reductions to income and increases to other comprehensive income (loss). (b) Reclassified from accumulated other comprehensive loss into selling, general and administrative expenses. These amounts are included in the computation of net periodic costs (see Note 10 for additional details). Changes in AOCI for the three months ended March 31, 2017 and 2016 were as follows: Cash flow hedges Available for sale securities Pension and postretirement benefit plans Foreign currency adjustments Total Balance at January 1, 2017 $ (1,485 ) $ 120 $ (787,813 ) $ (150,955 ) $ (940,133 ) Other comprehensive income (loss) before reclassifications (a) 216 516 (1,482 ) 19,915 19,165 Reclassifications into earnings (a), (b) 360 69 6,708 — 7,137 Net other comprehensive income 576 585 5,226 19,915 26,302 Balance at March 31, 2017 $ (909 ) $ 705 $ (782,587 ) $ (131,040 ) $ (913,831 ) Cash flow hedges Available for sale securities Pension and postretirement benefit plans Foreign currency adjustments Total Balance at January 1, 2016 $ (3,912 ) $ 536 $ (738,768 ) $ (146,491 ) $ (888,635 ) Other comprehensive (loss) income before reclassifications (a) (432 ) 3,465 (1,230 ) 39,849 41,652 Reclassifications into earnings (a), (b) 404 (11 ) 6,748 — 7,141 Net other comprehensive (loss) income (28 ) 3,454 5,518 39,849 48,793 Balance at March 31, 2016 $ (3,940 ) $ 3,990 $ (733,250 ) $ (106,642 ) $ (839,842 ) (a) Amounts are net of tax. Amounts in parentheses indicate debits to AOCI. (b) See table above for additional details of these reclassifications. |
Description of Business and B22
Description of Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements - Standards Adopted in 2017 In January 2017, the Financial Accounting Standard Board (FASB) issued Accounting Standard Update (ASU) 2017-04, Intangibles - Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment , which eliminates Step 2 of the current two-step goodwill impairment test and requires only a one-step quantitative impairment test, whereby a goodwill impairment loss will be measured as the excess of a reporting unit’s carrying amount over its fair value (not to exceed the total goodwill allocated to that reporting unit). The ASU is effective for interim and annual periods beginning after December 15, 2019, and is required to be applied prospectively. We elected to early adopt this standard effective January 1, 2017. The adoption of this standard had no impact on our consolidated financial statements or disclosures. In March 2016, the FASB issued ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . The standard includes multiple provisions intended to simplify various aspects of the accounting for share-based payments. We retroactively adopted this ASU effective January 1, 2017. Accordingly, the Condensed Consolidated Statement of Cash Flows as of March 31, 2016 has been recast to increase net cash provided by operating activities and net cash used in financing activities by $5 million . In July 2015, the FASB issued ASU 2015-11, Inventory - Simplifying the Measurement of Inventory , which requires inventory to be measured at the lower of cost and net realizable value (estimated selling price less reasonably predictable costs of completion, disposal and transportation). Inventory measured using the last-in, first-out (LIFO) basis is not impacted by the new guidance. This standard became effective January 1, 2017 and there was no impact on our consolidated financial statements or disclosures. New Accounting Pronouncements - Standards Not Yet Adopted In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Benefit Cost. The ASU requires the service cost component of net periodic benefit cost to be presented in the same income statement line item as other employee compensation costs arising from services rendered during the period. Other components of the net periodic benefit cost are to be presented separately, in an appropriately titled line item outside of any subtotal of operating income or disclosed in the footnotes. The standard also limits the amount eligible for capitalization to the service cost component. The standard is effective for interim and annual periods beginning after December 15, 2017 and we are currently assessing the impact this standard will have on our consolidated financial statements. In January 2017, the FASB issued ASU 2017-06 – Plan Accounting: Defined Benefit Pension Plans (Topic 960); Defined Contribution Pension Plans (Topic 962); Health and Welfare Benefit Plans (Topic 965): Employee Benefit Plan Master Trust Reporting . The ASU requires separate disclosure in the statement of net assets available for benefits and the statement of changes in net assets available for benefits of changes in any interests held in a Master Trust and other enhanced disclosures. The standard is effective for interim and annual periods beginning after December 15, 2018 and we are currently evaluating the impact of this standard on our consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business, which clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The standard is effective for interim and annual periods beginning after December 15, 2017. The impact on our consolidated financial statements will depend on the facts and circumstances of any specific future transactions. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes: Inter-entity Transfers of Assets other than Inventory, which requires tax expense to be recognized from the sale of intra-entity assets, other than inventory, when the transfer occurs, even though the effects of the transaction are eliminated in consolidation. Under current guidance, the tax effects of transfers are deferred until the transferred asset is sold or otherwise recovered through use. The standard is effective for interim and annual periods beginning after December 15, 2017 and early adoption is permitted, including adoption during an interim period. We are currently assessing the impact this standard will have on our consolidated financial statements. In August, 2016, the FASB issued ASU No. 2016-15, Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force). The ASU is intended to reduce diversity in practice in the presentation and classification of certain cash receipts and cash payments by providing guidance on eight specific cash flow issues. The ASU is effective for interim and annual periods beginning after December 15, 2017 and early adoption is permitted, including adoption during an interim period. We are currently assessing the impact this standard will have on our consolidated statement of cash flows. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses . The ASU sets forth a “current expected credit loss” (CECL) model which requires companies to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost and applies to some off-balance sheet credit exposures. This standard is effective for interim and annual periods beginning after December 15, 2019. We are currently assessing the impact this standard will have on our consolidated financial statements and disclosures. In February 2016, the FASB issued ASU 2016-02, Leases. This standard, among other things, will require lessees to recognize almost all leases on their balance sheet as a right-of-use asset and a lease liability and result in enhanced disclosures. The standard is effective for interim and annual periods beginning after December 15, 2018 and early adoption is permitted. We are currently assessing the impact this standard will have on our consolidated financial statements and disclosures. In January 2016, the FASB issued ASU 2016-01, Financial Instruments–Overall: Recognition and Measurement of Financial Assets and Financial Liabilities . This standard primarily affects the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. The standard is effective for interim and annual periods beginning after December 15, 2017, and early adoption is permitted. We are currently assessing the impact this standard will have on our consolidated financial statements and disclosures. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , which requires companies to recognize revenue for the transfer of goods and services to customers in amounts that reflect the consideration the company expects to receive in exchange for those goods and services. In addition, the standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue. There were several amendments to the standard during 2016, including clarification of the accounting for licenses of intellectual property and identifying performance obligations. The standard is effective beginning January 1, 2018 and can be adopted either retrospectively to each reporting period presented or on a modified retrospective basis with a cumulative effect adjustment at the date of the initial application. We plan to adopt the standard retrospectively with a cumulative effect adjustment. We are continuing to assess all potential impacts of the standard across all of our business segments and believe that the most significant impact will be in our Software Solutions segment related to the timing of software licenses and certain other ancillary revenue streams. In addition, we currently capitalize certain costs associated with the acquisition of new customers and recognize these costs over their expected revenue stream of eight years. Under the new standard, these costs will be expensed as incurred. Also, we are continuing to review our sales commission plans to determine which payments may be capitalized. We plan to use the practical expedient that allows companies to expense costs to obtain a contract when the estimated amortization period is less than one year. |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Segments to Consolidated Statements | Revenue and EBIT by business segment is presented below: Revenue Three Months Ended March 31, 2017 2016 North America Mailing $ 355,578 $ 371,453 International Mailing 93,058 104,986 Small & Medium Business Solutions 448,636 476,439 Production Mail 88,955 87,425 Presort Services 132,677 127,396 Enterprise Business Solutions 221,632 214,821 Software Solutions 78,220 77,922 Global Ecommerce 88,152 75,407 Digital Commerce Solutions 166,372 153,329 Total revenue $ 836,640 $ 844,589 |
Reconciliation of EBIT from Segments to Consolidated | EBIT Three Months Ended March 31, 2017 2016 North America Mailing $ 141,008 $ 160,831 International Mailing 13,269 11,176 Small & Medium Business Solutions 154,277 172,007 Production Mail 8,964 6,824 Presort Services 30,717 28,910 Enterprise Business Solutions 39,681 35,734 Software Solutions 2,749 (2,572 ) Global Ecommerce (4,270 ) (3,469 ) Digital Commerce Solutions (1,521 ) (6,041 ) Total segment EBIT 192,437 201,700 Reconciling items: Interest, net (38,650 ) (34,216 ) Unallocated corporate expenses (55,156 ) (57,767 ) Restructuring charges and asset impairments, net (2,082 ) (6,933 ) Acquisition and disposition-related expenses — (3,120 ) Income before income taxes 96,549 99,664 Provision for income taxes 31,416 37,024 Net income $ 65,133 $ 62,640 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Numerator and Denominator in Earnings Per Share | The calculations of basic and diluted earnings per share are presented below. Three Months Ended March 31, 2017 2016 Numerator: Amounts attributable to common stockholders: Net income attributable to Pitney Bowes Inc. (numerator for diluted EPS) $ 65,133 $ 58,046 Less: Preference stock dividend 9 10 Income attributable to common stockholders (numerator for basic EPS) $ 65,124 $ 58,036 Denominator: Weighted-average shares used in basic EPS 185,982 192,241 Effect of dilutive shares: Conversion of Preferred stock and Preference stock 293 304 Employee stock plans 600 636 Weighted-average shares used in diluted EPS 186,875 193,181 Basic earnings per share $ 0.35 $ 0.30 Diluted earnings per share $ 0.35 $ 0.30 Anti-dilutive shares not used in calculating diluted weighted-average shares 11,176 8,870 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventory Components | Inventories at March 31, 2017 and December 31, 2016 consisted of the following: March 31, December 31, Raw materials $ 35,499 $ 28,541 Work in process 5,994 6,498 Supplies and service parts 49,729 45,152 Finished products 36,559 24,678 Inventory at FIFO cost 127,781 104,869 Excess of FIFO cost over LIFO cost (12,143 ) (12,143 ) Total inventory, net $ 115,638 $ 92,726 |
Finance Assets (Tables)
Finance Assets (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Receivables [Abstract] | |
Financing Receivables | Finance receivables at March 31, 2017 and December 31, 2016 consisted of the following: March 31, 2017 December 31, 2016 North America International Total North America International Total Sales-type lease receivables Gross finance receivables $ 1,073,533 $ 266,437 $ 1,339,970 $ 1,088,053 $ 273,262 $ 1,361,315 Unguaranteed residual values 89,292 13,543 102,835 90,190 13,655 103,845 Unearned income (220,515 ) (61,056 ) (281,571 ) (223,908 ) (60,458 ) (284,366 ) Allowance for credit losses (8,816 ) (2,569 ) (11,385 ) (8,247 ) (2,647 ) (10,894 ) Net investment in sales-type lease receivables 933,494 216,355 1,149,849 946,088 223,812 1,169,900 Loan receivables Loan receivables 342,037 34,579 376,616 374,147 32,716 406,863 Allowance for credit losses (7,369 ) (1,076 ) (8,445 ) (8,517 ) (1,089 ) (9,606 ) Net investment in loan receivables 334,668 33,503 368,171 365,630 31,627 397,257 Net investment in finance receivables $ 1,268,162 $ 249,858 $ 1,518,020 $ 1,311,718 $ 255,439 $ 1,567,157 |
Allowance for Credit Losses on Financing Receivables | Activity in the allowance for credit losses for the three months ended March 31, 2017 and 2016 was as follows: Sales-type Lease Receivables Loan Receivables North America International North America International Total Balance at January 1, 2017 $ 8,247 $ 2,647 $ 8,517 $ 1,089 $ 20,500 Amounts charged to expense 1,758 178 639 144 2,719 Write-offs and other (1,189 ) (256 ) (1,787 ) (157 ) (3,389 ) Balance at March 31, 2017 $ 8,816 $ 2,569 $ 7,369 $ 1,076 $ 19,830 Sales-type Lease Receivables Loan Receivables North America International North America International Total Balance at January 1, 2016 $ 6,606 $ 3,542 $ 10,024 $ 1,518 $ 21,690 Amounts charged to expense 995 50 1,300 157 2,502 Write-offs and other (1,705 ) (495 ) (2,138 ) (123 ) (4,461 ) Balance at March 31, 2016 $ 5,896 $ 3,097 $ 9,186 $ 1,552 $ 19,731 |
Past Due Financing Receivables | The aging of gross finance receivables at March 31, 2017 and December 31, 2016 was as follows: March 31, 2017 Sales-type Lease Receivables Loan Receivables North America International North America International Total 1 - 90 days $ 1,004,804 $ 262,172 $ 333,362 $ 34,251 $ 1,634,589 > 90 days 68,729 4,265 8,675 328 81,997 Total $ 1,073,533 $ 266,437 $ 342,037 $ 34,579 $ 1,716,586 Past due amounts > 90 days Still accruing interest $ 12,104 $ 1,192 $ — $ — $ 13,296 Not accruing interest 56,625 3,073 8,675 328 68,701 Total $ 68,729 $ 4,265 $ 8,675 $ 328 $ 81,997 As of March 31, 2017, we had North America sales-type lease receivables aged greater than 90 days with a contract value of $69 million . As of April 28, 2017, we received payments with a contract value of approximately $26 million related to these receivables. December 31, 2016 Sales-type Lease Receivables Loan Receivables North America International North America International Total 1 - 90 days $ 1,025,313 $ 269,247 $ 366,726 $ 32,420 $ 1,693,706 > 90 days 62,740 4,015 7,421 296 74,472 Total $ 1,088,053 $ 273,262 $ 374,147 $ 32,716 $ 1,768,178 Past due amounts > 90 days Still accruing interest $ 8,831 $ 972 $ — $ — $ 9,803 Not accruing interest 53,909 3,043 7,421 296 64,669 Total $ 62,740 $ 4,015 $ 7,421 $ 296 $ 74,472 |
Financing Receivable Credit Quality Indicators | March 31, December 31, Sales-type lease receivables Low $ 865,202 $ 879,823 Medium 137,624 135,953 High 22,202 22,600 Not Scored 48,505 49,677 Total $ 1,073,533 $ 1,088,053 Loan receivables Low $ 265,626 $ 296,598 Medium 54,164 53,647 High 6,078 7,216 Not Scored 16,169 16,686 Total $ 342,037 $ 374,147 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets Disclosure | Intangible assets at March 31, 2017 and December 31, 2016 consisted of the following: March 31, 2017 December 31, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 447,830 $ (308,756 ) $ 139,074 $ 445,039 $ (300,906 ) $ 144,133 Software & technology 150,748 (137,693 ) 13,055 150,037 (136,508 ) 13,529 Trademarks & other 36,372 (29,301 ) 7,071 36,212 (28,702 ) 7,510 Total intangible assets $ 634,950 $ (475,750 ) $ 159,200 $ 631,288 $ (466,116 ) $ 165,172 |
Amortization Expense In Future Periods | Future amortization expense as of March 31, 2017 was as follows: Remaining for year ending December 31, 2017 $ 21,768 Year ending December 31, 2018 27,455 Year ending December 31, 2019 24,079 Year ending December 31, 2020 18,904 Year ending December 31, 2021 15,301 Thereafter 51,693 Total $ 159,200 |
Schedule of Goodwill | Changes in the carrying value of goodwill, by reporting segment, for the three months ended March 31, 2017 are shown in the table below. Prior year amounts have been recast for the change in reportable segments. December 31, 2016 Acquisitions Foreign currency translation March 31, North America Mailing $ 354,000 $ — $ 1,402 $ 355,402 International Mailing 145,566 — 1,587 147,153 Small & Medium Business Solutions 499,566 — 2,989 502,555 Production Mail 101,099 — 766 101,865 Presort Services 196,890 6,229 — 203,119 Enterprise Business Solutions 297,989 6,229 766 304,984 Software Solutions 501,591 — 1,983 503,574 Global Ecommerce 272,189 — — 272,189 Digital Commerce Solutions 773,780 — 1,983 775,763 Total goodwill $ 1,571,335 $ 6,229 $ 5,738 $ 1,583,302 |
Fair Value Measurements and D28
Fair Value Measurements and Derivative Instruments (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect its placement within the fair value hierarchy. The following tables show, by level within the fair value hierarchy, our financial assets and liabilities that are accounted for at fair value on a recurring basis at March 31, 2017 and December 31, 2016 . March 31, 2017 Level 1 Level 2 Level 3 Total Assets: Investment securities Money market funds / commercial paper $ 121,807 $ 255,169 $ — $ 376,976 Equity securities — 23,432 — 23,432 Commingled fixed income securities 1,543 21,598 — 23,141 Debt securities - U.S. and foreign governments, agencies and municipalities 111,144 22,126 — 133,270 Debt securities - corporate — 71,093 — 71,093 Mortgage-backed / asset-backed securities — 158,681 — 158,681 Derivatives Interest rate swap — 2,056 — 2,056 Foreign exchange contracts — 889 — 889 Total assets $ 234,494 $ 555,044 $ — $ 789,538 Liabilities: Derivatives Foreign exchange contracts $ — $ (263 ) $ — $ (263 ) Total liabilities $ — $ (263 ) $ — $ (263 ) December 31, 2016 Level 1 Level 2 Level 3 Total Assets: Investment securities Money market funds / commercial paper $ 114,471 $ 217,175 $ — $ 331,646 Equity securities — 24,571 — 24,571 Commingled fixed income securities 1,536 22,132 — 23,668 Debt securities - U.S. and foreign governments, agencies and municipalities 116,822 19,358 — 136,180 Debt securities - corporate — 69,891 — 69,891 Mortgage-backed / asset-backed securities — 158,996 — 158,996 Derivatives Interest rate swap — 1,588 — 1,588 Foreign exchange contracts — 637 — 637 Total assets $ 232,829 $ 514,348 $ — $ 747,177 Liabilities: Derivatives Foreign exchange contracts $ — $ (3,717 ) $ — $ (3,717 ) Total liabilities $ — $ (3,717 ) $ — $ (3,717 ) |
Schedule of Available-for-sale Securities Reconciliation | Available-for-sale securities at March 31, 2017 and December 31, 2016 consisted of the following: March 31, 2017 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value U.S. and foreign governments, agencies and municipalities $ 125,151 $ 1,694 $ (1,473 ) $ 125,372 Corporate notes and bonds 70,302 1,312 (521 ) 71,093 Commingled fixed income securities 1,576 — (33 ) 1,543 Mortgage-backed / asset-backed securities 158,718 1,583 (1,620 ) 158,681 Total $ 355,747 $ 4,589 $ (3,647 ) $ 356,689 December 31, 2016 Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value U.S. and foreign governments, agencies and municipalities $ 136,316 $ 1,571 $ (1,707 ) $ 136,180 Corporate notes and bonds 69,376 1,180 (665 ) 69,891 Commingled fixed income securities 1,568 — (32 ) 1,536 Mortgage-backed / asset-backed securities 159,312 1,566 (1,882 ) 158,996 Total $ 366,572 $ 4,317 $ (4,286 ) $ 366,603 |
Available-for-sale Securities | Scheduled maturities of available-for-sale securities at March 31, 2017 were as follows: Amortized cost Estimated fair value Within 1 year $ 29,886 $ 29,936 After 1 year through 5 years 106,796 107,300 After 5 years through 10 years 63,107 63,339 After 10 years 155,958 156,114 Total $ 355,747 $ 356,689 |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The fair value of derivative instruments at March 31, 2017 and December 31, 2016 was as follows: Designation of Derivatives Balance Sheet Location March 31, December 31, Derivatives designated as hedging instruments Foreign exchange contracts Other current assets and prepayments $ 353 $ 487 Accounts payable and accrued liabilities (35 ) (136 ) Interest Rate Swap Other assets 2,056 1,588 Derivatives not designated as hedging instruments Foreign exchange contracts Other current assets and prepayments 536 150 Accounts payable and accrued liabilities (228 ) (3,581 ) Total derivative assets $ 2,945 $ 2,225 Total derivative liabilities (263 ) (3,717 ) Total net derivative asset (liabilities) $ 2,682 $ (1,492 ) |
Schedule of Cash Flow Hedging Instruments, Statements of Financial Performance and Financial Position, Location | The following represents the results of cash flow hedging relationships for the three months ended March 31, 2017 and 2016 : Three Months Ended March 31, Derivative Gain (Loss) Recognized in AOCI (Effective Portion) Location of Gain (Loss) (Effective Portion) Gain (Loss) Reclassified from AOCI to Earnings (Effective Portion) Derivative Instrument 2017 2016 2017 2016 Foreign exchange contracts $ 50 $ (393 ) Revenue $ (28 ) (380 ) Cost of sales 111 225 Interest rate swap 468 — Interest Expense — — $ 518 $ (393 ) $ 83 $ (155 ) |
Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location | The following represents the results of our non-designated derivative instruments for the three months ended March 31, 2017 and 2016 : Three Months Ended March 31, Derivative Gain (Loss) Recognized in Earnings Derivatives Instrument Location of Derivative Gain (Loss) 2017 2016 Foreign exchange contracts Selling, general and administrative expense $ (1,849 ) $ (5,977 ) |
Fair Value, by Balance Sheet Grouping | The carrying value and estimated fair value of our debt at March 31, 2017 and December 31, 2016 were as follows: March 31, 2017 December 31, 2016 Carrying value $ 3,284,312 $ 3,364,890 Fair value $ 3,341,434 $ 3,412,581 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost | Activity in our restructuring reserves for the three months ended March 31, 2017 and 2016 was as follows: Severance and benefits costs Other exit costs Total Balance at January 1, 2017 $ 28,376 $ 281 $ 28,657 Expenses, net 1,419 67 1,486 Cash payments (12,294 ) (122 ) (12,416 ) Balance at March 31, 2017 $ 17,501 $ 226 $ 17,727 Balance at January 1, 2016 $ 43,700 $ 3,722 $ 47,422 Expenses, net 4,590 1,060 5,650 Cash payments (19,956 ) (1,700 ) (21,656 ) Balance at March 31, 2016 $ 28,334 $ 3,082 $ 31,416 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Total debt at March 31, 2017 and December 31, 2016 consisted of the following: Interest rate March 31, 2017 December 31, 2016 Notes due September 2017 5.75% $ 385,109 $ 385,109 Notes due March 2018 5.6% 250,000 250,000 Notes due May 2018 4.75% 350,000 350,000 Notes due March 2019 6.25% 300,000 300,000 Notes due October 2021 3.375% 600,000 600,000 Notes due March 2024 4.625% 500,000 500,000 Notes due January 2037 5.25% 35,841 115,041 Notes due March 2043 6.7% 425,000 425,000 Term loans Variable 450,000 450,000 Other debt 5,584 5,677 Principal amount 3,301,534 3,380,827 Less: unamortized debt discount and issuance costs 27,600 28,796 Plus: unamortized interest rate swap proceeds 10,378 12,859 Total debt 3,284,312 3,364,890 Less: current portion long-term debt 785,287 614,485 Long-term debt $ 2,499,025 $ 2,750,405 |
Pensions and Other Benefit Pr31
Pensions and Other Benefit Programs (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
Schedule of Defined Benefit Plans Disclosures | The components of net periodic benefit cost (income) were as follows: Defined Benefit Pension Plans Nonpension Postretirement Benefit Plans United States Foreign Three Months Ended Three Months Ended Three Months Ended March 31, March 31, March 31, 2017 2016 2017 2016 2017 2016 Service cost $ 30 $ 32 $ 542 $ 527 $ 419 $ 501 Interest cost 17,244 18,830 4,544 5,661 1,771 2,136 Expected return on plan assets (24,548 ) (25,589 ) (7,780 ) (8,472 ) — — Amortization of transition credit — — (2 ) (2 ) — — Amortization of prior service (credit) cost (15 ) (15 ) (18 ) (17 ) 74 74 Amortization of net actuarial loss 7,268 6,706 2,034 1,343 884 1,360 Settlement (1) — 1,098 — — — — Net periodic benefit cost (income) $ (21 ) $ 1,062 $ (680 ) $ (960 ) $ 3,148 $ 4,071 (1) Included in restructuring charges and asset impairments, net in the Condensed Consolidated Statements of Income. |
Stockholders' (Deficit) Equity
Stockholders' (Deficit) Equity (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stockholders Equity | Changes in stockholders’ (deficit) equity for the three months ended March 31, 2017 and 2016 were as follows: Preferred stock Preference stock Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive loss Treasury stock Total deficit Balance at January 1, 2017 $ 1 $ 483 $ 323,338 $ 148,125 $ 5,107,734 $ (940,133 ) $ (4,743,208 ) $ (103,660 ) Net income — — — — 65,133 — — 65,133 Other comprehensive income — — — — — 26,302 — 26,302 Dividends paid — — — — (34,567 ) — — (34,567 ) Issuance of common stock — — — (27,098 ) — — 21,914 (5,184 ) Conversion to common stock — (5 ) — (101 ) — — 106 — Stock-based compensation expense — — — 5,638 — — — 5,638 Balance at March 31, 2017 $ 1 $ 478 $ 323,338 $ 126,564 $ 5,138,300 $ (913,831 ) $ (4,721,188 ) $ (46,338 ) Preferred stock Preference stock Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive loss Treasury stock Total equity Balance at January 1, 2016 $ 1 $ 505 $ 323,338 $ 161,280 $ 5,155,537 $ (888,635 ) $ (4,573,305 ) $ 178,721 Net income — — — — 58,046 — — 58,046 Other comprehensive loss — — — — — 48,793 — 48,793 Dividends paid — — — — (36,010 ) — — (36,010 ) Issuance of common stock — — — (21,555 ) — — 17,421 (4,134 ) Conversion to common stock — (13 ) — (273 ) — — 286 — Stock-based compensation expense — — — 6,303 — — — 6,303 Repurchase of common stock — — — — — — (128,451 ) (128,451 ) Balance at March 31, 2016 $ 1 $ 492 $ 323,338 $ 145,755 $ 5,177,573 $ (839,842 ) $ (4,684,049 ) $ 123,268 |
Accumulated Other Comprehensi33
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Reclassification out of Accumulated Other Comprehensive Income | Reclassifications out of AOCI for the three months ended March 31, 2017 and 2016 were as follows: Amount Reclassified from AOCI (a) Three Months Ended March 31, 2017 2016 Gains (losses) on cash flow hedges Revenue $ 28 $ (380 ) Cost of sales (111 ) 225 Interest expense, net (507 ) (507 ) Total before tax (590 ) (662 ) Benefit for income tax (230 ) (258 ) Net of tax $ (360 ) $ (404 ) Gains (losses) on available for sale securities Interest expense, net $ (109 ) $ 18 (Benefit) provision for income tax (40 ) 7 Net of tax $ (69 ) $ 11 Pension and Postretirement Benefit Plans (b) Transition credit $ 2 $ 2 Prior service costs (41 ) (42 ) Actuarial losses (10,186 ) (9,409 ) Settlements — (1,098 ) Total before tax (10,225 ) (10,547 ) Benefit from income tax (3,517 ) (3,799 ) Net of tax $ (6,708 ) $ (6,748 ) (a) Amounts in parentheses indicate reductions to income and increases to other comprehensive income (loss). (b) Reclassified from accumulated other comprehensive loss into selling, general and administrative expenses. These amounts are included in the computation of net periodic costs (see Note 10 for additional details). |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in AOCI for the three months ended March 31, 2017 and 2016 were as follows: Cash flow hedges Available for sale securities Pension and postretirement benefit plans Foreign currency adjustments Total Balance at January 1, 2017 $ (1,485 ) $ 120 $ (787,813 ) $ (150,955 ) $ (940,133 ) Other comprehensive income (loss) before reclassifications (a) 216 516 (1,482 ) 19,915 19,165 Reclassifications into earnings (a), (b) 360 69 6,708 — 7,137 Net other comprehensive income 576 585 5,226 19,915 26,302 Balance at March 31, 2017 $ (909 ) $ 705 $ (782,587 ) $ (131,040 ) $ (913,831 ) Cash flow hedges Available for sale securities Pension and postretirement benefit plans Foreign currency adjustments Total Balance at January 1, 2016 $ (3,912 ) $ 536 $ (738,768 ) $ (146,491 ) $ (888,635 ) Other comprehensive (loss) income before reclassifications (a) (432 ) 3,465 (1,230 ) 39,849 41,652 Reclassifications into earnings (a), (b) 404 (11 ) 6,748 — 7,141 Net other comprehensive (loss) income (28 ) 3,454 5,518 39,849 48,793 Balance at March 31, 2016 $ (3,940 ) $ 3,990 $ (733,250 ) $ (106,642 ) $ (839,842 ) (a) Amounts are net of tax. Amounts in parentheses indicate debits to AOCI. (b) See table above for additional details of these reclassifications. |
Description of Business and B34
Description of Business and Basis of Presentation (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Reduction to cash and cash equivalents | $ (739,553) | $ (602,232) | $ (764,522) | $ (640,190) |
Increase (decrease) in net cash provided by operating activities | 154,006 | 63,493 | ||
Increase (decrease) in net cash used in financing activities | $ (119,503) | (60,825) | ||
Capitalization period | 8 years | |||
Accounting Standards Update 2016-09 | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Increase (decrease) in net cash provided by operating activities | 5,000 | |||
Increase (decrease) in net cash used in financing activities | (5,000) | |||
Restatement Adjustment | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Reduction to cash and cash equivalents | $ 11,000 | $ 10,000 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Segment reporting information profit (loss) | ||
Revenues | $ 836,640 | $ 844,589 |
Reconciling items: | ||
Interest, net | (38,650) | (34,216) |
Unallocated corporate expenses | (55,156) | (57,767) |
Restructuring charges and asset impairments, net | (2,082) | (6,933) |
Acquisition and disposition-related expenses | 0 | (3,120) |
Income before income taxes | 96,549 | 99,664 |
Provision for income taxes | 31,416 | 37,024 |
Net income | 65,133 | 62,640 |
North America Mailing | ||
Segment reporting information profit (loss) | ||
Revenues | 355,578 | 371,453 |
International Mailing | ||
Segment reporting information profit (loss) | ||
Revenues | 93,058 | 104,986 |
Small & Medium Business Solutions | ||
Segment reporting information profit (loss) | ||
Revenues | 448,636 | 476,439 |
Production Mail | ||
Segment reporting information profit (loss) | ||
Revenues | 88,955 | 87,425 |
Presort Services | ||
Segment reporting information profit (loss) | ||
Revenues | 132,677 | 127,396 |
Enterprise Business Solutions | ||
Segment reporting information profit (loss) | ||
Revenues | 221,632 | 214,821 |
Software Solutions | ||
Segment reporting information profit (loss) | ||
Revenues | 78,220 | 77,922 |
Global Ecommerce | ||
Segment reporting information profit (loss) | ||
Revenues | 88,152 | 75,407 |
Digital Commerce Solutions | ||
Segment reporting information profit (loss) | ||
Revenues | 166,372 | 153,329 |
Operating Segments | ||
Segment reporting information profit (loss) | ||
EBIT | 192,437 | 201,700 |
Operating Segments | North America Mailing | ||
Segment reporting information profit (loss) | ||
EBIT | 141,008 | 160,831 |
Operating Segments | International Mailing | ||
Segment reporting information profit (loss) | ||
EBIT | 13,269 | 11,176 |
Operating Segments | Small & Medium Business Solutions | ||
Segment reporting information profit (loss) | ||
EBIT | 154,277 | 172,007 |
Operating Segments | Production Mail | ||
Segment reporting information profit (loss) | ||
EBIT | 8,964 | 6,824 |
Operating Segments | Presort Services | ||
Segment reporting information profit (loss) | ||
EBIT | 30,717 | 28,910 |
Operating Segments | Enterprise Business Solutions | ||
Segment reporting information profit (loss) | ||
EBIT | 39,681 | 35,734 |
Operating Segments | Software Solutions | ||
Segment reporting information profit (loss) | ||
EBIT | 2,749 | (2,572) |
Operating Segments | Global Ecommerce | ||
Segment reporting information profit (loss) | ||
EBIT | (4,270) | (3,469) |
Operating Segments | Digital Commerce Solutions | ||
Segment reporting information profit (loss) | ||
EBIT | $ (1,521) | $ (6,041) |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Amounts attributable to common stockholders: | ||
Net income attributable to Pitney Bowes Inc. (numerator for diluted EPS) | $ 65,133 | $ 58,046 |
Less: Preference stock dividend | 9 | 10 |
Income attributable to common stockholders (numerator for basic EPS) | $ 65,124 | $ 58,036 |
Denominator: | ||
Weighted-average shares used in basic EPS (in shares) | 185,982 | 192,241 |
Effect of dilutive shares: | ||
Conversion of Preferred stock and Preference stock (in shares) | 293 | 304 |
Employee stock plans (in shares) | 600 | 636 |
Weighted-average shares used in diluted EPS (in shares) | 186,875 | 193,181 |
Basic (in dollars per share) | $ 0.35 | $ 0.30 |
Diluted (in dollars per share) | $ 0.35 | $ 0.30 |
Anti-dilutive shares not used in calculating diluted weighted-average shares (in shares) | 11,176 | 8,870 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 35,499 | $ 28,541 |
Work in process | 5,994 | 6,498 |
Supplies and service parts | 49,729 | 45,152 |
Finished products | 36,559 | 24,678 |
Inventory at FIFO cost | 127,781 | 104,869 |
Excess of FIFO cost over LIFO cost | (12,143) | (12,143) |
Total inventory, net | $ 115,638 | $ 92,726 |
Finance Assets (Details)
Finance Assets (Details) - USD ($) $ in Thousands | Apr. 30, 2017 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 |
Loan receivables | ||||
Net investment in finance receivables | $ 1,518,020 | $ 1,567,157 | ||
Allowance for Loan and Lease Losses [Roll Forward] | ||||
Balance Beginning | 20,500 | $ 21,690 | ||
Amounts charged to expense | 2,719 | 2,502 | ||
Write-offs and other | (3,389) | (4,461) | ||
Balance Closing | 19,830 | 19,731 | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables | $ 1,716,586 | 1,768,178 | ||
Revenue recognition resume period (less than) | 60 days | |||
Low | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Approximate percentage of portfolio | 30.00% | |||
Medium | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Approximate percentage of portfolio | 40.00% | |||
High | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Approximate percentage of portfolio | 30.00% | |||
North America | ||||
Loan receivables | ||||
Net investment in finance receivables | $ 1,268,162 | 1,311,718 | ||
International | ||||
Loan receivables | ||||
Net investment in finance receivables | 249,858 | 255,439 | ||
Sales-type lease receivables | ||||
Sales-type lease receivables | ||||
Gross finance receivables | 1,339,970 | 1,361,315 | ||
Unguaranteed residual values | 102,835 | 103,845 | ||
Unearned income | (281,571) | (284,366) | ||
Allowance for credit losses | (11,385) | (10,894) | ||
Net investment in sales-type lease receivables | $ 1,149,849 | 1,169,900 | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Revenue recognition discontinuation period (more than) | 120 days | |||
Sales-type lease receivables | North America | ||||
Sales-type lease receivables | ||||
Gross finance receivables | $ 1,073,533 | 1,088,053 | ||
Unguaranteed residual values | 89,292 | 90,190 | ||
Unearned income | (220,515) | (223,908) | ||
Allowance for credit losses | (8,816) | (8,247) | ||
Net investment in sales-type lease receivables | 933,494 | 946,088 | ||
Allowance for Loan and Lease Losses [Roll Forward] | ||||
Balance Beginning | 8,247 | 6,606 | ||
Amounts charged to expense | 1,758 | 995 | ||
Write-offs and other | (1,189) | (1,705) | ||
Balance Closing | 8,816 | 5,896 | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables | 1,073,533 | 1,088,053 | ||
Sales-type lease receivables | North America | Low | ||||
Sales-type lease receivables | ||||
Gross finance receivables | 865,202 | 879,823 | ||
Sales-type lease receivables | North America | Medium | ||||
Sales-type lease receivables | ||||
Gross finance receivables | 137,624 | 135,953 | ||
Sales-type lease receivables | North America | High | ||||
Sales-type lease receivables | ||||
Gross finance receivables | 22,202 | 22,600 | ||
Sales-type lease receivables | North America | Not Scored | ||||
Sales-type lease receivables | ||||
Gross finance receivables | 48,505 | 49,677 | ||
Sales-type lease receivables | International | ||||
Sales-type lease receivables | ||||
Gross finance receivables | 266,437 | 273,262 | ||
Unguaranteed residual values | 13,543 | 13,655 | ||
Unearned income | (61,056) | (60,458) | ||
Allowance for credit losses | (2,569) | (2,647) | ||
Net investment in sales-type lease receivables | 216,355 | 223,812 | ||
Allowance for Loan and Lease Losses [Roll Forward] | ||||
Balance Beginning | 2,647 | 3,542 | ||
Amounts charged to expense | 178 | 50 | ||
Write-offs and other | (256) | (495) | ||
Balance Closing | 2,569 | 3,097 | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables | 266,437 | 273,262 | ||
Loan receivables | ||||
Loan receivables | ||||
Loan receivables | 376,616 | 406,863 | ||
Allowance for credit losses | (8,445) | (9,606) | ||
Net investment in loan receivables | $ 368,171 | 397,257 | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Revenue recognition discontinuation period (more than) | 90 days | |||
Loan receivables | North America | ||||
Loan receivables | ||||
Loan receivables | $ 342,037 | 374,147 | ||
Allowance for credit losses | (7,369) | (8,517) | ||
Net investment in loan receivables | 334,668 | 365,630 | ||
Allowance for Loan and Lease Losses [Roll Forward] | ||||
Balance Beginning | 8,517 | 10,024 | ||
Amounts charged to expense | 639 | 1,300 | ||
Write-offs and other | (1,787) | (2,138) | ||
Balance Closing | 7,369 | 9,186 | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables | 342,037 | 374,147 | ||
Loan receivables | North America | Low | ||||
Loan receivables | ||||
Loan receivables | 265,626 | 296,598 | ||
Loan receivables | North America | Medium | ||||
Loan receivables | ||||
Loan receivables | 54,164 | 53,647 | ||
Loan receivables | North America | High | ||||
Loan receivables | ||||
Loan receivables | 6,078 | 7,216 | ||
Loan receivables | North America | Not Scored | ||||
Loan receivables | ||||
Loan receivables | 16,169 | 16,686 | ||
Loan receivables | International | ||||
Loan receivables | ||||
Loan receivables | 34,579 | 32,716 | ||
Allowance for credit losses | (1,076) | (1,089) | ||
Net investment in loan receivables | 33,503 | 31,627 | ||
Allowance for Loan and Lease Losses [Roll Forward] | ||||
Balance Beginning | 1,089 | 1,518 | ||
Amounts charged to expense | 144 | 157 | ||
Write-offs and other | (157) | (123) | ||
Balance Closing | 1,076 | $ 1,552 | ||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables | 34,579 | 32,716 | ||
1 - 90 days | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables, current | 1,634,589 | 1,693,706 | ||
1 - 90 days | Sales-type lease receivables | North America | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables, current | 1,004,804 | 1,025,313 | ||
1 - 90 days | Sales-type lease receivables | International | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables, current | 262,172 | 269,247 | ||
1 - 90 days | Loan receivables | North America | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables, current | 333,362 | 366,726 | ||
1 - 90 days | Loan receivables | International | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables, current | 34,251 | 32,420 | ||
Greater than 90 days | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables | 81,997 | 74,472 | ||
Still accruing interest | 13,296 | 9,803 | ||
Not accruing interest | 68,701 | 64,669 | ||
Greater than 90 days | Sales-type lease receivables | North America | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables | 68,729 | 62,740 | ||
Still accruing interest | 12,104 | 8,831 | ||
Not accruing interest | 56,625 | 53,909 | ||
Greater than 90 days | Sales-type lease receivables | International | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables | 4,265 | 4,015 | ||
Still accruing interest | 1,192 | 972 | ||
Not accruing interest | 3,073 | 3,043 | ||
Greater than 90 days | Loan receivables | North America | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables | 8,675 | 7,421 | ||
Still accruing interest | 0 | 0 | ||
Not accruing interest | 8,675 | 7,421 | ||
Greater than 90 days | Loan receivables | International | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Financing receivables | 328 | 296 | ||
Still accruing interest | 0 | 0 | ||
Not accruing interest | $ 328 | $ 296 | ||
Subsequent Event | Sales-type lease receivables | North America | ||||
Financing Receivable, Recorded Investment, Aging [Abstract] | ||||
Payment contract value | $ 26,000 | |||
Minimum | ||||
Finance Leases And Loans Receivables [Line Items] | ||||
Lease period | 3 years | |||
Maximum | ||||
Finance Leases And Loans Receivables [Line Items] | ||||
Lease period | 5 years |
Intangible Assets and Goodwil39
Intangible Assets and Goodwill (Intangible Assets) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Finite lived intangible assets | |||
Gross Carrying Amount | $ 634,950 | $ 631,288 | |
Accumulated Amortization | (475,750) | (466,116) | |
Net Carrying Amount | 159,200 | 165,172 | |
Amortization expense | 8,000 | $ 11,000 | |
Customer relationships | |||
Finite lived intangible assets | |||
Gross Carrying Amount | 447,830 | 445,039 | |
Accumulated Amortization | (308,756) | (300,906) | |
Net Carrying Amount | 139,074 | 144,133 | |
Software & technology | |||
Finite lived intangible assets | |||
Gross Carrying Amount | 150,748 | 150,037 | |
Accumulated Amortization | (137,693) | (136,508) | |
Net Carrying Amount | 13,055 | 13,529 | |
Trademarks & other | |||
Finite lived intangible assets | |||
Gross Carrying Amount | 36,372 | 36,212 | |
Accumulated Amortization | (29,301) | (28,702) | |
Net Carrying Amount | $ 7,071 | $ 7,510 |
Intangible Assets and Goodwil40
Intangible Assets and Goodwill (Future Amortization Expense) (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Finite lived intangible assets future amortization expense | ||
Remaining for year ending December 31, 2017 | $ 21,768 | |
Year ending December 31, 2018 | 27,455 | |
Year ending December 31, 2019 | 24,079 | |
Year ending December 31, 2020 | 18,904 | |
Year ending December 31, 2021 | 15,301 | |
Thereafter | 51,693 | |
Net Carrying Amount | $ 159,200 | $ 165,172 |
Intangible Assets and Goodwil41
Intangible Assets and Goodwill (Goodwill) (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Goodwill [Roll Forward] | |
Goodwill | $ 1,571,335 |
Acquisitions | 6,229 |
Foreign currency translation | 5,738 |
Goodwill | 1,583,302 |
North America Mailing | |
Goodwill [Roll Forward] | |
Goodwill | 354,000 |
Acquisitions | 0 |
Foreign currency translation | 1,402 |
Goodwill | 355,402 |
International Mailing | |
Goodwill [Roll Forward] | |
Goodwill | 145,566 |
Acquisitions | 0 |
Foreign currency translation | 1,587 |
Goodwill | 147,153 |
Small & Medium Business Solutions | |
Goodwill [Roll Forward] | |
Goodwill | 499,566 |
Acquisitions | 0 |
Foreign currency translation | 2,989 |
Goodwill | 502,555 |
Production Mail | |
Goodwill [Roll Forward] | |
Goodwill | 101,099 |
Acquisitions | 0 |
Foreign currency translation | 766 |
Goodwill | 101,865 |
Presort Services | |
Goodwill [Roll Forward] | |
Goodwill | 196,890 |
Acquisitions | 6,229 |
Foreign currency translation | 0 |
Goodwill | 203,119 |
Enterprise Business Solutions | |
Goodwill [Roll Forward] | |
Goodwill | 297,989 |
Acquisitions | 6,229 |
Foreign currency translation | 766 |
Goodwill | 304,984 |
Software Solutions | |
Goodwill [Roll Forward] | |
Goodwill | 501,591 |
Acquisitions | 0 |
Foreign currency translation | 1,983 |
Goodwill | 503,574 |
Global Ecommerce | |
Goodwill [Roll Forward] | |
Goodwill | 272,189 |
Acquisitions | 0 |
Foreign currency translation | 0 |
Goodwill | 272,189 |
Digital Commerce Solutions | |
Goodwill [Roll Forward] | |
Goodwill | 773,780 |
Acquisitions | 0 |
Foreign currency translation | 1,983 |
Goodwill | $ 775,763 |
Fair Value Measurements and D42
Fair Value Measurements and Derivative Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | $ 789,538 | $ 747,177 |
Liabilities: | (263) | (3,717) |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 234,494 | 232,829 |
Liabilities: | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 555,044 | 514,348 |
Liabilities: | (263) | (3,717) |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Liabilities: | 0 | 0 |
Money market funds / commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 376,976 | 331,646 |
Money market funds / commercial paper | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 121,807 | 114,471 |
Money market funds / commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 255,169 | 217,175 |
Money market funds / commercial paper | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 23,432 | 24,571 |
Equity securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Equity securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 23,432 | 24,571 |
Equity securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Commingled fixed income securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 23,141 | 23,668 |
Commingled fixed income securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 1,543 | 1,536 |
Commingled fixed income securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 21,598 | 22,132 |
Commingled fixed income securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Debt securities - U.S. and foreign governments, agencies and municipalities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 133,270 | 136,180 |
Debt securities - U.S. and foreign governments, agencies and municipalities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 111,144 | 116,822 |
Debt securities - U.S. and foreign governments, agencies and municipalities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 22,126 | 19,358 |
Debt securities - U.S. and foreign governments, agencies and municipalities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Debt securities - corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 71,093 | 69,891 |
Debt securities - corporate | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Debt securities - corporate | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 71,093 | 69,891 |
Debt securities - corporate | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Mortgage-backed / asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 158,681 | 158,996 |
Mortgage-backed / asset-backed securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Mortgage-backed / asset-backed securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 158,681 | 158,996 |
Mortgage-backed / asset-backed securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Interest rate swap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 2,056 | 1,588 |
Interest rate swap | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Interest rate swap | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 2,056 | 1,588 |
Interest rate swap | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 889 | 637 |
Liabilities: | (263) | (3,717) |
Foreign exchange contracts | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Liabilities: | 0 | 0 |
Foreign exchange contracts | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 889 | 637 |
Liabilities: | (263) | (3,717) |
Foreign exchange contracts | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets: | 0 | 0 |
Liabilities: | $ 0 | $ 0 |
Fair Value Measurements and D43
Fair Value Measurements and Derivative Instruments (Available-for-sale Securities) (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | $ 355,747 | $ 366,572 |
Gross unrealized gains | 4,589 | 4,317 |
Gross unrealized losses | (3,647) | (4,286) |
Estimated fair value | 356,689 | 366,603 |
U.S. and foreign governments, agencies and municipalities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 125,151 | 136,316 |
Gross unrealized gains | 1,694 | 1,571 |
Gross unrealized losses | (1,473) | (1,707) |
Estimated fair value | 125,372 | 136,180 |
Corporate notes and bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 70,302 | 69,376 |
Gross unrealized gains | 1,312 | 1,180 |
Gross unrealized losses | (521) | (665) |
Estimated fair value | 71,093 | 69,891 |
Commingled fixed income securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 1,576 | 1,568 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | (33) | (32) |
Estimated fair value | 1,543 | 1,536 |
Mortgage-backed / asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized cost | 158,718 | 159,312 |
Gross unrealized gains | 1,583 | 1,566 |
Gross unrealized losses | (1,620) | (1,882) |
Estimated fair value | $ 158,681 | $ 158,996 |
Fair Value Measurements and D44
Fair Value Measurements and Derivative Instruments (Narrative) (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Derivative [Line Items] | ||
Investment securities at a loss position for more than 12 months, aggregate unrealized holding losses (less than) | $ 1,000,000 | $ 1,000,000 |
Investment securities at a loss position for more than 12 months, estimated fair value | 7,000,000 | 12,000,000 |
Investment securities at a loss position for less than 12 months, aggregate unrealized holding losses (less than) | 3,000,000 | 4,000,000 |
Investment securities at a loss position for less than 12 months, estimated fair value | 166,000,000 | 171,000,000 |
Foreign exchange contracts | ||
Derivative [Line Items] | ||
Derivative notional amount | 12,000,000 | $ 13,000,000 |
Term Loan | Notes due December 2020 | ||
Derivative [Line Items] | ||
Loan amount | 300,000,000 | |
Cash Flow Hedge | Interest rate swaps | ||
Derivative [Line Items] | ||
Derivative notional amount | $ 300,000,000 | |
Fixed interest rate | 0.8826% |
Fair Value Measurements and D45
Fair Value Measurements and Derivative Instruments (Available-for-sale Securities Maturities) (Details) $ in Thousands | Mar. 31, 2017USD ($) |
Fair Value Disclosures [Abstract] | |
Amortized cost - Within 1 year | $ 29,886 |
Amortized cost - After 1 year through 5 years | 106,796 |
Amortized cost - After 5 years through 10 years | 63,107 |
Amortized cost - After 10 years | 155,958 |
Amortized cost - Total | 355,747 |
Estimated fair value - Within 1 year | 29,936 |
Estimated fair value - After 1 year through 5 years | 107,300 |
Estimated fair value - After 5 years through 10 years | 63,339 |
Estimated fair value - After 10 years | 156,114 |
Estimated fair value - Total | $ 356,689 |
Fair Value Measurements and D46
Fair Value Measurements and Derivative Instruments (Derivative Instruments) (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Derivative [Line Items] | ||
Total net derivative asset (liabilities) | $ 2,682 | $ (1,492) |
Total derivative assets | ||
Derivative [Line Items] | ||
Total net derivative asset (liabilities) | 2,945 | 2,225 |
Total derivative liabilities | ||
Derivative [Line Items] | ||
Total net derivative asset (liabilities) | (263) | (3,717) |
Foreign exchange contracts | Derivatives designated as hedging instruments | Other current assets and prepayments | ||
Derivative [Line Items] | ||
Total net derivative asset (liabilities) | 353 | 487 |
Foreign exchange contracts | Derivatives designated as hedging instruments | Accounts payable and accrued liabilities | ||
Derivative [Line Items] | ||
Total net derivative asset (liabilities) | (35) | (136) |
Foreign exchange contracts | Derivatives not designated as hedging instruments | Other current assets and prepayments | ||
Derivative [Line Items] | ||
Total net derivative asset (liabilities) | 536 | 150 |
Foreign exchange contracts | Derivatives not designated as hedging instruments | Accounts payable and accrued liabilities | ||
Derivative [Line Items] | ||
Total net derivative asset (liabilities) | (228) | (3,581) |
Interest rate swap | Derivatives designated as hedging instruments | Other current assets and prepayments | ||
Derivative [Line Items] | ||
Total net derivative asset (liabilities) | $ 2,056 | $ 1,588 |
Fair Value Measurements and D47
Fair Value Measurements and Derivative Instruments (Foreign Exchange Contracts) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Derivative [Line Items] | ||
Derivative Gain (Loss) Recognized in AOCI (Effective Portion) | $ 518 | $ (393) |
Gain (Loss) Reclassified from AOCI to Earnings (Effective Portion) | 83 | (155) |
Revenue | ||
Derivative [Line Items] | ||
Gain (Loss) Reclassified from AOCI to Earnings (Effective Portion) | (28) | (380) |
Cost of sales | ||
Derivative [Line Items] | ||
Gain (Loss) Reclassified from AOCI to Earnings (Effective Portion) | 111 | 225 |
Interest Expense | ||
Derivative [Line Items] | ||
Gain (Loss) Reclassified from AOCI to Earnings (Effective Portion) | 0 | 0 |
Foreign exchange contracts | ||
Derivative [Line Items] | ||
Derivative Gain (Loss) Recognized in AOCI (Effective Portion) | 50 | (393) |
Foreign exchange contracts | Selling, general and administrative expense | ||
Derivative [Line Items] | ||
Derivative Gain (Loss) Recognized in Earnings | (1,849) | (5,977) |
Interest rate swap | ||
Derivative [Line Items] | ||
Derivative Gain (Loss) Recognized in AOCI (Effective Portion) | $ 468 | $ 0 |
Fair Value Measurements and D48
Fair Value Measurements and Derivative Instruments (Fair Value of Debt) (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Carrying value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | $ 3,284,312 | $ 3,364,890 |
Fair value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt | $ 3,341,434 | $ 3,412,581 |
Restructuring Charges (Details)
Restructuring Charges (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Restructuring Costs [Abstract] | ||
Cash payments | $ (12,416) | $ (21,656) |
Restructuring reserve, expected international payment period, extend beyond | 24 months | |
Operational Excellence | ||
Restructuring Costs [Abstract] | ||
Balance Beginning | $ 28,657 | 47,422 |
Expenses, net | 1,486 | 5,650 |
Cash payments | (12,416) | (21,656) |
Balance Ending | 17,727 | 31,416 |
Operational Excellence | Severance and benefits costs | ||
Restructuring Costs [Abstract] | ||
Balance Beginning | 28,376 | 43,700 |
Expenses, net | 1,419 | 4,590 |
Cash payments | (12,294) | (19,956) |
Balance Ending | 17,501 | 28,334 |
Operational Excellence | Other exit costs | ||
Restructuring Costs [Abstract] | ||
Balance Beginning | 281 | 3,722 |
Expenses, net | 67 | 1,060 |
Cash payments | (122) | (1,700) |
Balance Ending | $ 226 | $ 3,082 |
Minimum | ||
Restructuring Costs [Abstract] | ||
Restructuring reserve, expected payment period | 12 months | |
Maximum | ||
Restructuring Costs [Abstract] | ||
Restructuring reserve, expected payment period | 24 months |
Debt (Details)
Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Jan. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | |||
Debt | $ 3,301,534 | $ 3,380,827 | |
Less: unamortized debt discount and issuance costs | 27,600 | 28,796 | |
Plus: unamortized interest rate swap proceeds | 10,378 | 12,859 | |
Total debt | 3,284,312 | 3,364,890 | |
Less: current portion long-term debt | 785,287 | 614,485 | |
Long-term debt | $ 2,499,025 | 2,750,405 | |
Notes due September 2017 | |||
Debt Instrument [Line Items] | |||
Interest rate | 5.75% | ||
Debt | $ 385,109 | 385,109 | |
Notes due March 2018 | |||
Debt Instrument [Line Items] | |||
Interest rate | 5.60% | ||
Debt | $ 250,000 | 250,000 | |
Notes due May 2018 | |||
Debt Instrument [Line Items] | |||
Interest rate | 4.75% | ||
Debt | $ 350,000 | 350,000 | |
Notes due March 2019 | |||
Debt Instrument [Line Items] | |||
Interest rate | 6.25% | ||
Debt | $ 300,000 | 300,000 | |
Notes due October 2021 | |||
Debt Instrument [Line Items] | |||
Interest rate | 3.375% | ||
Debt | $ 600,000 | 600,000 | |
Notes due March 2024 | |||
Debt Instrument [Line Items] | |||
Interest rate | 4.625% | ||
Debt | $ 500,000 | 500,000 | |
Notes due January 2037 | |||
Debt Instrument [Line Items] | |||
Interest rate | 5.25% | 5.25% | |
Debt | $ 35,841 | 115,041 | |
Redemption amount | $ 79,000 | ||
Notes due March 2043 | |||
Debt Instrument [Line Items] | |||
Interest rate | 6.70% | ||
Debt | $ 425,000 | 425,000 | |
Term loans | |||
Debt Instrument [Line Items] | |||
Debt | 450,000 | 450,000 | |
Other debt | |||
Debt Instrument [Line Items] | |||
Debt | $ 5,584 | $ 5,677 |
Pensions and Other Benefit Pr51
Pensions and Other Benefit Programs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
United States | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | $ 30 | $ 32 |
Interest cost | 17,244 | 18,830 |
Expected return on plan assets | (24,548) | (25,589) |
Amortization of transition credit | 0 | 0 |
Amortization of prior service (credit) cost | (15) | (15) |
Amortization of net actuarial loss | 7,268 | 6,706 |
Settlement | 0 | 1,098 |
Net periodic benefit cost (income) | (21) | 1,062 |
Foreign | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 542 | 527 |
Interest cost | 4,544 | 5,661 |
Expected return on plan assets | (7,780) | (8,472) |
Amortization of transition credit | (2) | (2) |
Amortization of prior service (credit) cost | (18) | (17) |
Amortization of net actuarial loss | 2,034 | 1,343 |
Settlement | 0 | 0 |
Net periodic benefit cost (income) | (680) | (960) |
Nonpension Postretirement Benefit Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 419 | 501 |
Interest cost | 1,771 | 2,136 |
Expected return on plan assets | 0 | 0 |
Amortization of transition credit | 0 | 0 |
Amortization of prior service (credit) cost | 74 | 74 |
Amortization of net actuarial loss | 884 | 1,360 |
Settlement | 0 | 0 |
Net periodic benefit cost (income) | $ 3,148 | $ 4,071 |
Pensions and Other Benefit Pr52
Pensions and Other Benefit Programs (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
United States | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Contributions by employer | $ 2 | $ 4 |
Foreign | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Contributions by employer | 9 | 38 |
Nonpension Postretirement Benefit Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Contributions by employer | $ 5 | $ 4 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2018 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Effective tax rate (percent) | 32.50% | 37.10% | |
Charge from valuation allowance for tax carryovers | $ 4 | $ 3 | |
Tax benefit from resolution of settlement | $ 4 | ||
Scenario, Forecast | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Percent decrease in unrecognized benefits, reasonably possible (up to) | 25.00% |
Stockholders' (Deficit) Equit54
Stockholders' (Deficit) Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balances, beginning of period | $ (103,660) | $ 178,721 |
Net income | 65,133 | 58,046 |
Other comprehensive income | 26,302 | 48,793 |
Dividends paid | (34,567) | (36,010) |
Issuance of common stock | (5,184) | (4,134) |
Conversion to common stock | 0 | 0 |
Stock-based compensation expense | 5,638 | 6,303 |
Repurchase of common stock | 0 | (128,451) |
Balances, end of period | (46,338) | 123,268 |
Preferred stock | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balances, beginning of period | 1 | 1 |
Conversion to common stock | 0 | |
Balances, end of period | 1 | 1 |
Preference stock | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balances, beginning of period | 483 | 505 |
Conversion to common stock | (5) | (13) |
Balances, end of period | 478 | 492 |
Common stock | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balances, beginning of period | 323,338 | 323,338 |
Balances, end of period | 323,338 | 323,338 |
Additional paid-in capital | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balances, beginning of period | 148,125 | 161,280 |
Issuance of common stock | (27,098) | (21,555) |
Conversion to common stock | (101) | (273) |
Stock-based compensation expense | 5,638 | 6,303 |
Balances, end of period | 126,564 | 145,755 |
Retained earnings | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balances, beginning of period | 5,107,734 | 5,155,537 |
Net income | 65,133 | 58,046 |
Dividends paid | (34,567) | (36,010) |
Balances, end of period | 5,138,300 | 5,177,573 |
Accumulated other comprehensive loss | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balances, beginning of period | (940,133) | (888,635) |
Other comprehensive income | 26,302 | 48,793 |
Balances, end of period | (913,831) | (839,842) |
Treasury stock | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balances, beginning of period | (4,743,208) | (4,573,305) |
Issuance of common stock | 21,914 | 17,421 |
Conversion to common stock | 106 | 286 |
Repurchase of common stock | 0 | (128,451) |
Balances, end of period | $ (4,721,188) | $ (4,684,049) |
Accumulated Other Comprehensi55
Accumulated Other Comprehensive Income (Loss) (Reclassifications) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Revenues | $ 836,640 | $ 844,589 |
Interest expense, net | (25,676) | (19,301) |
Selling, general and administrative | (306,303) | (326,882) |
Income before income taxes | 96,549 | 99,664 |
Benefit for income tax | 31,416 | 37,024 |
Net income | 65,133 | 62,640 |
Cash flow hedges | Reclassification out of Accumulated Other Comprehensive Loss | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Revenues | 28 | (380) |
Cost of sales | (111) | 225 |
Interest expense, net | (507) | (507) |
Income before income taxes | (590) | (662) |
Benefit for income tax | (230) | (258) |
Net income | (360) | (404) |
Available for sale securities | Reclassification out of Accumulated Other Comprehensive Loss | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Interest expense, net | (109) | 18 |
Benefit for income tax | (40) | 7 |
Net income | (69) | 11 |
Transition credit | Reclassification out of Accumulated Other Comprehensive Loss | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Selling, general and administrative | 2 | 2 |
Pension and postretirement benefit plans | Reclassification out of Accumulated Other Comprehensive Loss | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Income before income taxes | (10,225) | (10,547) |
Benefit for income tax | (3,517) | (3,799) |
Net income | (6,708) | (6,748) |
Prior service costs | Reclassification out of Accumulated Other Comprehensive Loss | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Selling, general and administrative | (41) | (42) |
Actuarial losses | Reclassification out of Accumulated Other Comprehensive Loss | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Selling, general and administrative | (10,186) | (9,409) |
Settlements | Reclassification out of Accumulated Other Comprehensive Loss | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Selling, general and administrative | $ 0 | $ (1,098) |
Accumulated Other Comprehensi56
Accumulated Other Comprehensive Income (Loss) (Changes) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balances, beginning of period | $ (103,660) | $ 178,721 |
Other comprehensive income (loss) before reclassifications | 19,165 | 41,652 |
Amounts reclassified from accumulated other comprehensive loss | 7,137 | 7,141 |
Other comprehensive income, net of tax | 26,302 | 48,793 |
Balances, end of period | (46,338) | 123,268 |
Cash flow hedges | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balances, beginning of period | (1,485) | (3,912) |
Other comprehensive income (loss) before reclassifications | 216 | (432) |
Amounts reclassified from accumulated other comprehensive loss | 360 | 404 |
Other comprehensive income, net of tax | 576 | (28) |
Balances, end of period | (909) | (3,940) |
Available for sale securities | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balances, beginning of period | 120 | 536 |
Other comprehensive income (loss) before reclassifications | 516 | 3,465 |
Amounts reclassified from accumulated other comprehensive loss | 69 | (11) |
Other comprehensive income, net of tax | 585 | 3,454 |
Balances, end of period | 705 | 3,990 |
Pension and postretirement benefit plans | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balances, beginning of period | (787,813) | (738,768) |
Other comprehensive income (loss) before reclassifications | (1,482) | (1,230) |
Amounts reclassified from accumulated other comprehensive loss | 6,708 | 6,748 |
Other comprehensive income, net of tax | 5,226 | 5,518 |
Balances, end of period | (782,587) | (733,250) |
Foreign currency adjustments | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balances, beginning of period | (150,955) | (146,491) |
Other comprehensive income (loss) before reclassifications | 19,915 | 39,849 |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 |
Other comprehensive income, net of tax | 19,915 | 39,849 |
Balances, end of period | (131,040) | (106,642) |
Accumulated other comprehensive loss | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balances, beginning of period | (940,133) | (888,635) |
Other comprehensive income, net of tax | 26,302 | 48,793 |
Balances, end of period | $ (913,831) | $ (839,842) |