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PITNEY BOWES INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Tabular dollars in thousands, except per share data)
57
In September 2007, we issued $500 million of unsecured fixed rate notes maturing in September 2017. These notes bear
interest at an annual rate of 5.75% and pay interest semi-annually beginning in March 2008. The proceeds from these notes
were used for general corporate purposes, including the repayment of commercial paper, the financing of acquisitions, and
repurchase of our stock.
In November 2006, we issued $500 million of unsecured fixed rate notes maturing in January 2037. These notes bear interest
at an annual rate of 5.25% and pay interest semi-annually beginning in July 2007. The proceeds from these notes were used
for general corporate purposes, including the repayment of commercial paper, the financing of acquisitions and repurchase of
the Company’ s stock.
The annual maturities of the outstanding debt during each of the next five years are as follows: 2008, $550 million; 2009,
$150 million; 2010 – no maturities; 2011 – no maturities; 2012, $550 million; and $3,075 million thereafter.
The mortgage relates to debt assumed with the acquisition of MapInfo Corporation. The annual maturities of the outstanding
mortgage for 2008 - 2012 are $0.3 million each year and $12.0 million thereafter.
The fair value hedges basis adjustment represents the revaluation of fixed rate debt that has been hedged in accordance with
SFAS No. 133. See Note 1 to the Consolidated Financial Statements.
9. Income Taxes
Years ended December 31,
2007 2006 2005
Continuing operations:
Total current ................................................
$ 160,839
$ 298,364 $ 217,042
Total deferred ..............................................
119,383
36,640 111,555
Provision for income taxes ........................
$ 280,222
$ 335,004 $ 328,597
U.S. and international components of income from operations before income taxes and minority interest are as follows:
Years ended December 31,
2007 2006 2005
Continuing operations:
U.S............................................................. $ 624,030
$ 719,931 $ 623,529
International .............................................. 36,681
194,559 188,139
Total continuing operations....................... 660,711
914,490 811,668
Discontinued operations................................. -
(682,149) 38,061
Total............................................................... $ 660,711
$ 232,341 $ 849,729
The effective tax rates for continuing operations for 2007, 2006 and 2005 were 42.4%, 36.6% and 40.5%, respectively. The
effective tax rate for 2007 included $54 million of tax charges related principally to a valuation allowance for certain deferred
tax assets and tax rate changes outside of the U.S. The effective tax rate for 2006 and 2005 included a $20 million and $56
million charge, respectively, related to the IRS settlement discussed below.