PBI - Earnings call transcript Q2 2024

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Operator

Good afternoon. Welcome to the Pitney Bowes Second Quarter 2024 Earnings Conference Call. [Operator Instructions] Today's call is also being recorded. [Operator Instructions] I would like to introduce parties on today's conference call. Mr. Executive Board Chief Mr. Interim Rosenzweig, Officer Member; and Lance Officer; John Chief Mr. Witek, Interim and Investor Relations. Mr. Director, Brown, Alex Brown begin will Harbor Safe now the call the with overview.

Alex Brown

today's performance. thank us. about and for future presentation in our financial afternoon, statements are and Good business forward-looking you Included joining

risks filed and that by Relations. located do www.pb.com in reports could of to and involve SEC our on press found result our information are we uncertainties be a obligation can new with that results cause clicking the or information More update release, uncertainties website at as forward-looking our not Form mind earnings Please Report and undertake from be other any different projections. and Investor statements on XX-K our keep about statements actual to Forward-looking materially these Annual XXXX risks in developments.

tables For release press measures can reconciliations in to non-GAAP the materials, release. or discussed the to included that GAAP you measures our presentation find attached the appropriate our press are in in

We have on and a our website. provided segment presentation with historical spreadsheet information a also slide

comparisons time, our to the EBITDA, be cash Lance. CEO, in call on free to EPS revenue basis. At as basis will items like remarks, prepared currency and on a EBIT, adjusted an our Interim flow I with other would Finally, this constant such over turn

Lance Rosenzweig

quarterly call Pitney Bowes. with Thank you, Alex, for and good afternoon. I'm earnings you my very excited to first join

commitment. share our I X that shipping to Just significant to at and a May, on I by end the outlined on company in focusing delivering made Today, have strategic am commitment couple transformation of ago, that strides this mailing months accelerating we of initiatives. of proud iconic the

and a increase Presort, value high-level more profitability also EBIT period, position for executed of becoming enhanced in creation, million our resulting strong a our for providing results, cash-generating SendTech adjusted will efficient, XX% begin enterprise. and in to prior provide $X.XX steps Bowes perhaps Pitney year. Adjusted We details results revenues our overview free have for reflect commitment have will significant cash the and on opportunity profitable across on as $XX compared last decisive and quarter. I maintained to $X.XX most momentarily. the continued John and improvement year-over-year priorities continue while QX which the in relatively quickly steady within earnings cash taken of of $XX and flow QX by of a that delivering Bowes over the to to more We second performance be EPS a sustained our million, a share, year, of quarter flow reinforces $XX for enhancements notably, an growth implemented improvement the quarter we enterprise. Pitney million year-over-year. The an was was strong

losses Entities Pitney well-defined legal, a the interest sell conduct a the the be segment the sold advisers to an to after XX the optimal review for was fiduciaries the Entities review sale maximize key this resulted GEC Stord in identifying Today, financial which completed ongoing is me be face the was future extensive earlier business Bowes GEC's with determined Let and connection losses this business. orderly initiatives. the for Chapter and to strategic will segment subsidiary all path through and independent maximizing on majority our headwinds. the completion over process. Notably, liquidation. independent thoroughly that and weighed of not in the an liquidation ultimately profitability July path GEC macroeconomic conclusion. Ultimately, GEC's restructuring transaction filed the commence bankruptcy several to the business the working today. industry the review path interest cases against our the past in to and the and Chapter GEC process fulfillment decision of value for to the years to the assess and support turn to liabilities now shareholders. We A of to alternatives which the part bring of of potential This the Ecommerce X Bowes stem need us of Global GEC numerous options a Global, XX an We and for that affiliate we of or highlight our our exit, strategic this business will company been the process. In and strategic of momentum standalone in an completed Pitney determined after and our business, with intends value to to best closed limit timely GEC Board a that liquidation struggling achieve its to which business. of exit to has business, GEC of we Hilco in

which We expect while in be as The not for and XXXX, with Bowes SendTech Presort company's expect to more corporate in-court go businesses of positioning will a become course stronger and year this $XXX should exit full clear, not Pitney any in impact. negative any GEC Bowes normal substantially to the business, were associated entity. focused, results approximately will as company. To a continue we through streamlined to restructuring operate process a deliver path eliminate the all million XXXX Pitney losses

costs term Entities, Bank business subject be incur that in the including GEC ownership the onetime it the interest with Bowes, of process. approval the through going our loan this approximately positions SendTech clients providing XXXX. Pitney Bowes in to shipping remain to certain require we'll Bowes independent cash in mailing provides and early Pitney the to conclude GEC will by ordinary will forward. liquidation approvals will undergoing business $XXX million and and leader affected Hilco. the solutions In delayed liquidation Bowes anticipate the liquidation with industry are mailing exit, best-in-class Pitney an exceed in to court of XX The controlling $XX the GEC as support million, an multi-carrier GEC the to connection Hilco and wind-down Additionally, continue GEC The and in course. Selling process, will technology. from under business approximately which in path, both efficient also not not that to bankruptcy a will Chapter conduct of Pitney We court anticipates certain shipping both

to of Our Pitney to high-margin that our the Bowes' clients exit Presort investments provided position guarantees of pursue Bowes by the for our an long-term appreciate GEC default the new business and our lenders large steps allow with leans entered and growth smaller make purchase and to also success. The and will step is in towards it important This will businesses day note their businesses, company's and sortation for who our enterprises industry-leading value. and company to financial business continue shareholder up continue agreement core allow initiatives Entities. Bowes at financial to We of all credit recognize continues Financial flexibility additional accretive enhance and and Pitney secured financial other take to shipping. Pitney a of services the triggering for releases provide us support solidifying setting Services any help we into has was without have mail complexities mailing reduce GEC events amendments agreement the the to Pitney Global Bowes.

of As loss be will pretax which losses. benefit million, result of we partially approximately to expect by $XXX exiting a of a the GEC, offset expect tax recognize we

of I maintain top during appreciation partners customers, to GEC's Before service the disruption the A is for level moving on, other want vendors of Pitney highest of express and Bowes our and GEC. minimize transition. priority to

on possible We transitioning Their have sincere the moment GEC the to wind of are will this work alternatives business positioning in the out and extent and assist unsustainable the after employees. in to and fullest a all decision pause the remaining deeply best for reached hard appreciated the is also other company their to to market. I of of changes for to a understand years gratitude business performance. We this way segments to the want express losses, future our no to involved. as providers to these is But growth. clients reflective essential preserving whole impact down decision in

their are payments outplacement severance the to services We providing ease transition. team GEC and to

efficiency. driving initiative and Our second is excellence cost operational focused on

and and tough to which as $XXX of well necessary month We in we rationalization approximately of These have million, savings addressed target successfully been related our million corporate $XX yet implemented of our cost were of within over in to making savings exiting all efforts. Pitney remainder level directly last that anticipated million cost announced businesses. decisions much the GEC. We our will Bowes efficiency support $XXX as between to the XXXX. at total annual be anticipate the we core savings savings cost addition reiterate range

savings cost our full We quarters to opportunities ability for to we look we've and continue the the in of to will deliver additional range outlined, on in are come. confident

cash X primarily May of progress post of have increased made $XXX have that $XXX and our am to we Third, in will $XXX cash year-to-date. Accordingly, able million Pitney announced pleased reduction upstreaming up cash from we cash Bowes the already from areas: efforts, were through cash better go-forward in the in we have of approximately we $XXX cash significant and $XX I GEC. We the to of now working repatriation that Bank our international needs million. be to freed management. free Pitney of international goal estimate U.S. cash our we Bowes of from of million by the million, cash that repatriated share Bank initial cash, up in reduce optimization needs million

repatriate and during a levels pooling implemented of enable us year We an of global international moving structure, jurisdictions in to have second forward. cash additional lower cash maintain overseas to million will half which of expect the $XX the cash

sheet. is supported We materially optimizing expenses us reduction the the that around strategic be allow will These in cash GEC, deleveraging cash final efforts non-essential accelerate positions Our mentioned and will our reducing deleveraging balance taxes. objectives. to exiting previously initiative by believe

the we we of maturing reduction execute debt. on debt strategic our initiatives, near-term plan and high-cost prioritize to As

our We on will ratings. enhancing also focus credit

that forefront is are shipping innovative and to and confident further market Global needs, represent including options net businesses. SendTech significant These our growth cash our deliver our excellent have digital Services execution am Solutions Pitney its providing of mailing and evolving the we result technology, future plans income already for value clients. Presort And distinct the bright businesses future as for for for the efficient company's favorable expertise dynamics. core Financial and core continues of I forward, a contributions. success. Looking to our and and meaningful Bowes Bank, grow foundation at offerings,

these we to be changes model at the difficult significant recognize may company's it economics. the Given company,

of our midpoint investor trailing on of XX-month of Bowes based earnings very forecast, in inherent estimated which not we are the EBIT, million illustrative strategic on reductions effort million is presentation GEC we what such, resulting strong is cost ongoing for exit and to on be without potential from the we included our in deem Pitney process underlying initiatives. This the estimated the QX illustrate a the but XX removing. bridge EBIT adjusted Ecommerce As our impact an costs Slide IR website, the the $XXX the of $XXX Debtors and in to to have an

we've a a I not is we Pitney lot the While that upside progress still opportunity believe today is be encouraged want ahead. made, firmly and and there are to of we the is its Bowes victory early by transformation, innings lap. of in clear that

strength. I cash we management we to discuss second our improving results Witek to continue when forward, to now leave to detail. and it quarter no our and more call financial comes As stone unturned effective profitability, in turn financial the the overall for over John look capital will will

John Witek

driven quarter. EPS improved had for year, improved our in initiatives. tax across the improvement Lance. outlook offset and EBIT quarter. benefit by rest over Thank to go entire $X.XX quarter solid with you, quarter described. Starting $XX just a and was over higher million, interest strong updated and SendTech XX% drove progress in story the performance timing-related meaningful flow against terrific with now to the quarters which of was second our partially the bottom-line per first in the $X.XX enterprise X% revenue, by make the consolidated strategic and to Lance expense. Cash operating including half both Productivity will increasing share, a and prior results incorporates I results Consolidated was continue and and efforts reduction the million cost key year-over-year the great $XXX actions our up year. GEC, results. our Presort

the also first from second million Second a Presort quarter the receivables decline free cash had flow a revenue mailing-related which last our the better than and in lower was was in a is $XX declined near-term primarily up cost was later includes of its flow, $XXX to of SendTech headwinds and of flow. higher mix shipping capabilities. In partially upfront, quarter, year-over-year better capital revenue quarter migration, services Working through of offerings. mainly positive cash quarter million, are year. the up by of impacted improved extensions which and the our cost is strong this performance, as reduction impact initiatives value year-to-date a by demand but the materially continues XXXX. Operational growth versus growth, great in environment, product revenue is higher with X% revenue related by $XX it related leases. revenue products its free the to generated on results. In lease a This cost equipment due million, X% business and with mailing to half offset we X% our EBIT of lower improvement. SendTech better product new progress this improvement seeing driving quarter, million, $XXX takeout contributed higher basis remarks, driven the reduction of expand year-over-year, SendTech second to which cash total and financial leveraging results net shipping for $XXX on year-over-year. million and finance our initiatives. Mailing mix contract I'll dynamic written my on cycle, little quarter driven

new to technology. made solid total volume now and install are XX% IMI our We XX% our of of on meters the on low also our base migration. product progress mid

of in drove USPS all the meters XX% low services be of reminder, encouraged which about moderated year. Shipping the volume flat revenues gross of lower revenue. Similar XX% mid remain a SaaS grew business segment services gross comprise equipment We the most XX% last and margin and end in dollars were digital to expanded overall quarter, revenue. converted drove As shipping in-period and growth. requires the this performance shipping quarter. quarter by related to profit digital this includes the offerings, shipping quarter's our which now offering, year-over-year XXX points improvement in professional Segment margin to basis revenue, subscription year-over-year. SendTech's expansion of

pension the half first also it quarter headwind $X down of non-cash and level offset this receivables in year actions in headwind was higher primarily contributed lease the a actions were to modestly $X.X declined pension product expense. in financing as a was Our higher receivables, from the well, decrease and revenue X% or of were remain mix, year. Net finance by X% partially headcount of and of a we second the cost higher which to result expect lease million improvement. Operating year-over-year million expenses billion, Higher expense $X year-over-year from a in extensions.

the over up of an the of significant and XX% the of quality financing captive to the see EBIT significant strength receivables, the mentioned, up our we pieces excellent mail. $XXX quality we bank $XX drive grew conversion a we in lease PBI, and better of profit quarter X.X a our and quarter, XXX% year-over-year, with the productivity X% clients. In is a bank. In team billion million sorted participation value quarter, of opportunity fueled Lance addition had reflects was of improve leverage $XX to Presort to bank. Presort impressive the generated million provide the million As improvements. by million, cash value bank's to of which partly the contribution continues and the benefit to cash growth to Revenue quarters also year-over-year. $XX

to hour reduction year-over-year. versus prior hours productivity. network, the Process bar continues on up along automation XXX,XXX drove over Across Our analytics per with our a investments XX% pieces labor this of in prior to labor improvements and year. raise equates labor fed team

as drive transportation to consolidation optimization insourcing continue efficiency. terms. declined also lane improved costs year-over-year We Unit better well third-party and transportation X% contract through to due as

from a Higher Let productivity the X% in volumes pressure Domestic and decline $XX me below or loss units, year-over-year. Outside remained are offset million corporate in year. under volume market quarter. primarily briefly EBIT continued in and the targets, RPP this higher about overcapacity. per drove $XX versus revenue The the outperforming up last volumes. year-over-year of the leverage $XXX from quarter. compensation $X in unallocated of GEC's our in million, the quarter. Revenue prior benefited performance to cost XX% a client a expenses to a million operating in gains mix million XX% piece $X talk targets. driven year, increase fixed million due was $XX Parcel we well expenses business million was we our was were improvement and and were by variable year, The increase where

is determined metrics our against performance laid out compensation variable stock Our and price proxy. our by in

variable unallocated year-over-year. million corporate compensation, Excluding expenses $XX decreased

outlook. to me let Now turn the

We are actions to a and updating guidance performance. the GEC, exit strong incremental reduction first half cost of our reflect

updated Our GEC the expect third Entities, is continuing excludes be reflected a in the and on quarter. from discontinued guidance which basis operations will in operations we financial results

to prior holding of We low-single decline. digit to revenue are the flat guidance target

GEC therefore, revenue Presort Our growth guidance and previous expectations. performance prior assumed and to guidance implies SendTech revenue from improved from compared holding

Moving to profitability.

We of This double year $XXX our expect the to of GEC. million, XXXX more inclusive between continuing in $XXX operations full and reported EBIT. generate million than $XXX XXXX of EBIT million is company the

second key execute half expect we markets, well outlook well in me of second of through positioned year. the Both SendTech to we Presort the half into as in drivers several and to Let their walk the our head both the in remain and continue year.

to impact near-term on current that a take profit result related second the our expect level, to gross life dynamics cycle. At revenue going the a and year. I'm SendTech, half in from product our of For high of the expand to phase headwinds minute X the we

quarter year-to-date. has migration point, expect benefited the job first successfully from this in of the expectations we new half first resulting business the remaining portion previous half and a more in products. This to second as a its outperformed results. In navigating clients our be with team cycle done year, we great our higher base client This our the product installed product To of experience cancellation aligns rate. the to migrated difficult First, to second our transact, quarter migrations.

of X-plus mix the our leases from of half for IMI lease we Second, coming is to towards up products wave and the shift released more as new expect away of in are second first the expected This extensions renewal. year. years ago transactions

lease are we profitable continued us more the in for of produce full lease, flows the cash extensions term cost incurring equipment. transactions monthly to Over new since lock the without

revenue upfront However, the versus software extension of to and on lease. from This the as similar a a way lease recognized a P&L model lease as over with a as from SaaS transitioning company the creates model. is term equipment near-term sales in revenue financing pressure the a maintenance new dynamic license

stabilize will are revenue receivables. term, inventory transactions better as long and net the profitability flow through annuity less better for finance high-margin and our in investment the Over financing These cash revenue. to flowing due

lower sales term, to higher the financing long term revenue and produce summarize, in are So extensions near over the lease flow equipment cash positive.

well encouraged labor year. achieved are our highest the several record and in automation the takeaways. The which set strong that across our resulting quarter second in recent to the quarter, offering efficiencies end, have competitive evident Presort. clients, network. our productivity and year in our our The we We first business and by this in remain of Turning value years past meaningful of over technology half momentum. great the investments sales is the our first logo performed we beating performance in made of new in has to in previous To

the to us gives up second set the well half continue Presort this is of year. confidence of in perform All that to

cost Finally, reduction.

savings functions. moving As already reductions have organization. initiated a $XX headcount to mentioned, with of completed urgency with month annualized million across About ago, we from those the streamline that of Lance our are we support announced the savings been majority coming

gross to spending, take also will pass actions Indirect and thank to savings effect, to annualized to to continue million our we'll I'll $XXX $XXX million you, see to initiated I these and from but indirect savings we target. With these contribute it take benefits savings over have from that, longer back Lance. expect We reductions.

Lance Rosenzweig

in Thank you, to positioned the on memory opportunities than capitalize any core at John. better Pitney company's businesses. time Bowes cash-generating recent is in

the leadership creation. of open of our strategic to team as from now our concludes on look previously continuing value management aligned announced on boardroom to We to call when today's turnaround. This portion report to Bowes it Pitney to we New for shareholders progress initiatives the forward We'd is driving execute accelerate acceleration with comes the Q&A. now the and the the call. presentation like

Operator

the [Operator going Instructions] And first line for we're Lebiedzinski. Anthony

Anthony Lebiedzinski

Good the to of an see come to the end review conclusion here. GEC

just first, just question. quick a guess, clarifying I So

costs? cash maybe first, severance So of lease the onetime few I that $XXX in then touch a could on well. you terms mostly is and other Or cost million, just have of questions if that termination as and

John Witek

This be of costs the believe the we're And DIP going going outside other combination $XXX a to going that be providing. It's professional will That certain cetera. wind-down fees, of parent have There expenses is of bear. bear. is actually pre-petition some also also that the are parent to be professional et John. funding fees, a to the inclusive will some million few I There that items. then will we're

Anthony Lebiedzinski

corporate going Bowes that should of forward? Pitney So part the we is think about now simplified, no how longer unallocated and has GEC been business expenses

Lance Rosenzweig

expenses corporate down are Unallocated coming significantly.

a cost-cutting largely in significant charges. in is program corporate put that see Our think reduction in quarters the place we've those in And coming you'll charges. I

John Witek

corporate Yes, went the absolutely, well your as first areas, across script $XX you mentioned actually all units I unallocated. business mean Lance. in earlier, million as

Anthony Lebiedzinski

now you -- SendTech then And and have left. Presort so

overall your driver guys a that mind Do segment? it's So that talked shipping-related XX% how growth like like a high goal have within could I seems certainly you because to as that you in guess now be about really being the revenue. for of revenue SendTech,

Lance Rosenzweig

growth key the Anthony, and growth is, continuing. It we Yes. driver, anticipate that

SendTech's become revenue will more So material over an more percentage and overall mix. of it as time,

Anthony Lebiedzinski

business, for Presort attractive as that it's for while. as an then guys been a far obviously, you segment And now so --

acquisitions I some longer thinking think that you in grown some segment grow and are that past. through has to Do know How perhaps the opportunities inorganically? So you organically about additional term? that business guys there are

Lance Rosenzweig

We're about is utilization Presort its They're improve I well executing ongoing The the targets. lot a ongoing operations Presort extremely credit additional actively metrics for to performance et excited tuck-in team. and its think cetera. rates, and There Yes. and to the opportunities are of we M&A, and company very... business, continues also M&A are considering --

Anthony Lebiedzinski

last question pass for And on me it before I then to others.

So now allocation that any you've time, I overall short of capital be thoughts done dividend this period just of thinking? do done great. debt guys on work strategic That a review mean, and would reduction, lot you we've updated the a relatively in have versus the

Lance Rosenzweig

announce of And did quarter, very our and seriously. of availability an each Board dividend takes quarters. uses allocation with The do evaluating quarter, in recent We Sure. terms cash. dividends cash consistent this capital review other extensive or we a of

Operator

from for to line going Baird. we're Swope Matt next, the And

Matthew Swope

the is separately when you filing million, this know going on talk Could was GEC the today, more little is? play a talked wasn't here? timing this timing the out the is out? And include $XXX quite of does be cash DIP? bit I DIP guess max the on What I When how announced does -- you Or process I when the will Congratulations. transaction to happen? about from the the that? sort on of that Does from clear, the

Lance Rosenzweig

Yes.

more at take dive then a and details. you John, stab general can Let it, me into

and Hilco the today happened majority of sale Chapter the control XX to So today. closed the filing

the GEC in Very timetable. process. So It's both moving team of has that on those team. an put forward together Hilco plan highly organized are with the accelerated

-- expeditiously want to course We of on the final that inclusive do million fill $XXX million. $XXX is within your of you the in the to some It's XXXX. John, happen question financing. the that expect during and DIP

John Witek

year had And I earlier, timing severance as this year. far get $XXX for it also it first as as of front-end but off like the way -- not mention, it think sort And the into modeling I'd the -- it does the we're you of taper half includes include to the also mention next and million, didn't as will as of payments we of loaded it this only the DIP, then just second in to half team. asked, Yes. it be

Matthew Swope

DIP, has it is back a of potentially And about as DIP coming back? a we should a the think given you. would that as value is that some Should that think chance of $XX to there a of typically, that door? as we out -- million we Or loan producing think

Lance Rosenzweig

but sort total We're always it modeling as quarters. hopeful always and to see. couple uncertainty we'll of our the Bankruptcy of it. some see for has $XXX over We're part that million out coming cost, upside, we'll of how plays

Matthew Swope

do. like you And debt then, were that Lance, reduction. do you think up soon talked to You've near-term great said can you about debt cash, high-cost going the you and How start? done a job freeing of

have X.XX% of you call protection sitting soon. do notes I How SOFR the see plan debt expires but know the progressing? part there, the + You the reduction

Lance Rosenzweig

Yes.

going to in Our lenders, to our we us, and get our I'll is have restructuring very of believe our of We notes. been have say, support look we supportive first of significantly credit improved at over appreciate advantage and their that recent opportunities. though. near by refinancing credit as take intend a term, goes improved the as we time specific We our don't timetable

Matthew Swope

back do a target? back investment-grade that investment few Is leverage improvement. grade? that end, How maybe about goal to company. to to -- have that look was at get an forward? ago, Pitney Do talked I you years And Bowes mean going a you some you a ratings

Lance Rosenzweig

ratings kind We don't love we But would to have certainly forward. going of that. a our investment stated as goal

and improve trying prudently stronger our just cash the use time. are cash, to business over to to company run We significantly emerge optimize balance to a to our sheet

Matthew Swope

Well, congratulations again, guys.

Operator

we Sakon And line go into for from next, CreditSights. Peter the

Peter Sakon

part the on remaining Can churn what of year? comment expected the be you for your will

John Witek

question? I'm what? expected, can repeat sorry. You the you Peter,

Peter Sakon

that How do memory a be on our on your you you much SendTech? expectations of decline sort churn going at My number Could digit the forward? in to units. mid-single refresh expect recollection was of

John Witek

in I with IMI, difficult Yes. think spot mean if Yes. in Thanks migrations second a the now with about of year more have I of half you the coming the that what been where seen rates this we've transactions to the we're the up it. fairly where the I'd from I the that's point. Peter, now as we've and cancellation expect think the right guidance. say And expect up. year. all in And half tick second significant are -- would such, I our I would

year churn. second we're modeling what that up the in assumes through So tick the of half

Peter Sakon

And expecting Yes. how year? you're I'm to units interested actual amount And more in move what many is? this the

John Witek

going We're that disclose to Yes. Peter. not today,

Operator

go And Steinhardt, Contrarian line next, David we into for the Capital.

David Steinhardt

exciting of very all for free for think moves be give that is cash last year. It you've well flow at the this wonder see sense on free a you guide looks you're EBIT. like able where a Congrats of I progress. ahead given if I flow year point. pacing to the of today, cash might

John Witek

we've David, the should the I'd like this built got the about to positive John. flow year. lot is this first like half free give way. it what typically cash news We've seen of It don't very guidance. think into our a in We guidance, look but you some

to it expect half. would with first be the I pretty So consistent

David Steinhardt

of the expected shutdown Global of the And in to payments terms Ecommerce. related

a a at I be? up what DIP. low includes to the this the that in million. of terms Obviously, of might statement wonder, can us give point outcomes that think end $XXX I was you range

John Witek

you a I range. wouldn't give

a of the of there's twists lot way Lance mentioned turns and journey. this earlier, As along

go. it provide that we as rate, and we'll updates at modeled best we've So

David Steinhardt

-- of cost to XXXX? through through savings year And early you'll the that EBIT and takeout beyond in through But XXXX. illustrative for of get million the bridge that at of attack is most for we the going the rest to still I slide when terms cost to purposes. in should the I terms of SendTech into, too be judge guess, think be Presort goals the XXXX, able the for the -- is Or able it midpoint? $XXX rest and you'll understand

John Witek

Yes.

think kind what's we're would I annualized would the $XXX the the that savings to a quarter, an that to I And running be gross progress. range we So million, inside when sense, would well tell a by that up now, you we you range. range. right for good say pretty to had end feel making give million to of of at we first I going $XXX of fill

the being think on. And million around spend. kind idea majority to the $XXX indirect again, when the really about that you million, pace you $XX $XXX the million give coming is what's we're Just to of of us, of behind

have There that's So take a of that cetera. number relationships, bit et going to time transact. to are transactions go through more we little contracts, to a

that to be it's a So I longer, range. little that to expect that in bit going confident but take

Operator

Research. And we line Will the to for a Northcoast next, go Brunemann

Will Brunemann

to just sure million guidance trying just want this to $XX in of cost the I make I included in is the cuts much I'm half? of the the half second are of for growth understanding get year. How an core in understand second the EBIT. what

John Witek

year. the Will about the half $XX includes the of Of the that million, question. our guidance for thanks second for of half

Will Brunemann

the all real divestiture associated them? any with assets the also have estate of with responsibilities was the to dispose going to will And lease associated I of then eliminate will ask business? that you GEC, with And

John Witek

all transactions mix of Those of be the well. considered will $XXX are It within those million. a lot a

Lance Rosenzweig

proceedings. Chapter all accomplished the they during And XX be will

Will Brunemann

then And And that grow SendTech And just SendTech been would don't much more, shipping. shipping revenue continue anticipate is you growing one about really The how revenue just to double-digit? in mind. has to I'm you nicely. business if curious

John Witek

double-digit about I second in revenue. quarter. Yes. XX% It segment mean was it was the the of

double growing consistent digit. pretty been it's So

to I be same pace. would it Looking pretty expect that on forward, much

And with above XX% things nice well there. particularly of digital some covers growing offerings, really our the that, underneath

Operator

go the And Justin Management for for into DOMO we line Dopierala Capital next,

Justin Dopierala

the detailed I appreciate call. to and the earnings I actual just shareholder, Lance, transparency very say want an as

Lance Rosenzweig

Justin. you, that. appreciate I Thank

Justin Dopierala

change Yes. previous from It's incredible an the management team.

Going debt, debt paydown you with to have was during proceed you back I to wondering, be do any much able how may idea of guys XXXX?

John Witek

John. It's

wind-down first 'XX that done make the part that get along the the all as that. think sure I priority 'XX get expenses we of the through go first and with So we is and successfully to

now be I second And around will be to the fourth deleveraging a as the cash here. balance that business better sheet and a think our we're in produce a quick initiative along flow, strong first right then shape will with priority.

Justin Dopierala

share my calculations that accurate? that $XXX so of quick results $X.XX. EBIT for But And understand per Does in show million sound is XXXX. guidance of not I official earnings an that about

John Witek

not here. exhibit. an mind, the We're it's guidance in illustrates keep giving Justin, And really

bit maybe can we modeling. So a on help little the you more guide

Justin Dopierala

should Difficulty] [Technical be about share, $X.XX right? per

Lance Rosenzweig

GEC Yes, adjusting anticipated cost we the savings of a retrospective look provide of takeouts. from kind any kind didn't a it the at for EPS performance of EBIT Justin. information, and sort It's actual really

Justin Dopierala

the then the I XX%. else I someone are know comment. Well, I yielding guess And mean notes that mentioned over last

XXXX $XXX interest next year, you're in eliminating should right, that like be might the notes. it's I It be something prioritizing million about savings? early a think $XX sounds million, that year,

John Witek

think likely more That's our 'XX I [ likely be TLA the priority ]. would right. first But

Justin Dopierala

And I GEC is your last I would assume with is, would businesses. extremely -- have would I that improve important relationship your to post that assume comment actually I office imagine in the legacy And would the relationship.

guys with might conversations can I you wondering different you I'm office opinions. think have on other the people post about? have any that talk this if

Lance Rosenzweig

Yes. Sure.

segments, the We the we and across for hard Bowes years, has with our a consistently have time. business strong have relationship. dialogue all a relationship pretty XXX maintain work the and of partner Service Pitney to we USPS that Postal been

Justin Dopierala

Do relationship? you Ecommerce would Global think that improve exiting

Lance Rosenzweig

the don't with value happy USPS. it the really. really at very I'm that been. relationship would has different team the how make I know any whether We

Operator

line the to going Barclays. we're Harlib, Jeff Next, for

Jeffrey Harlib

So 'XX, cetera? that? and cash, you for costs, through $XXX of repatriation the you which early funded maybe that cash be expect Or million think to be But through I said will can will flow confirm raise et do of financing new just onetime the that? you mostly

John Witek

John. it's Jeff,

front-end said year. Let me of just that's the half I clarify. second loaded for earlier this likely

first So of half taper off it in -- the and through next be funded and will year, operational.

Jeffrey Harlib

flow sheet free the you're operational cash that and repatriating? and the balance Through cash

John Witek

That's right.

Jeffrey Harlib

e-commerce number, just come the kind of so with an up million for business, we of EBITDA $XX in the modeling it purposes, the range, can is D&A And pro forma?

John Witek

Jeff, it. can you clarify your question? I catch didn't

Jeffrey Harlib

number? D&A and EBITDA I you depreciation a EBIT, just to The Yes. forma the was gave of up that come and you're e-commerce, what amortization is -- pro with wondering the

John Witek

Yes. the $XX D&A second about in million the was Is quarter.

Jeffrey Harlib

How just bit of obviously, do executing about, on little you've cut thing, maybe in get too core of savings. a didn't you you job And a some done talk can these we your good comfortable deep last cost business areas?

Lance Rosenzweig

Yes.

it's extensive prior So risk have cost takeouts, forecasting risk. the the process our a manage actually well. really implementing and we're a as Jeff, And us, cost confident cost that cost And implement we've and is our we these very and and in Board with management important takeouts it's internally And as important new level to implications looked pretty to review pretty Board We're prior at to the process to very confident we our through. we potential and takeouts very takeout mitigate it. any detailed look risk. that on at plans go of

Operator

There are no Mr. like Rosenzweig, any to questions. make remarks? would more additional you

Lance Rosenzweig

Yes. this for quarter. forward everyone, and Thank and to again look questions, support next appreciate you, earnings joining for up We us call. your catching

Operator

your for today. Service. conclude our using Thank and AT&T Conferencing you for conference participation does that And for

You now may disconnect

Pitney Bowes (PBI) 8 Aug 242024 Q2 Earnings call transcript