Pitney Bowes 2013 Annual Report Download - page 32

Download and view the complete annual report

Please find page 32 of the 2013 Pitney Bowes annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 116

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116

21
EBIT
Year Ended December 31, % change
2013 2012 2011 2013 2012
North America Mailing $ 675 $ 689 $ 728 (2)% (5)%
International Mailing 72 76 93 (6)% (18)%
Small & Medium Business Solutions 747 765 821 (2)% (7)%
Production Mail 55 49 53 12 % (7)%
Presort Services 83 106 101 (22)% 5%
Enterprise Business Solutions 138 155 154 (11)% 1%
Digital Commerce Solutions 43 37 46 14 % (19)%
Total $ 928 $ 957 $ 1,021 (3)% (6)%
Small & Medium Business Solutions
Small & Medium Business Solutions revenue for 2013 was $2,331 million, a decrease of 4% compared to 2012 and EBIT was $747
million, a decrease of 2% compared to 2012. Small and Medium Business Solutions revenue in 2012 was $2,427 million, a decrease of
7% compared to 2011 and EBIT was $765 million, a decrease of 7% compared 2011. Within the Small & Medium Business Solutions
group:
North America Mailing
North America Mailing revenue decreased 5% to $1,723 million in 2013 compared to 2012. Recurring stream revenues, comprised of
supplies, rentals and financing revenue, declined 6% compared to last year and contributed to a 3% decline in North America Mailing
revenue primarily due to fewer meters in service and lower equipment sales in prior periods. Equipment sales and support services revenue
each declined 5% compared to last year and contributed to a 2% decline in North America Mailing revenue. EBIT decreased 2% to $675
million in 2013 compared to 2012 due to the decline in revenue, partially offset by various productivity initiatives. EBIT also benefited
from the progress made in implementing our new "go-to-market" strategy designed to improve the sales process and reduce costs by
providing our clients broader access to products and services through online and direct sales channels.
North America Mailing revenue decreased 7% to $1,819 million in 2012 compared to 2011. The decline was due to a 9% decrease in
recurring stream revenues due to fewer meters in service and lower equipment sales in prior periods and a 6% decline in equipment sales
primarily due to uncertain economic conditions. EBIT decreased 5% to $689 million in 2012 compared to 2011 primarily due to lower
revenues; however, EBIT margin improved as a result of continued productivity improvements and lower credit losses.
International Mailing
International Mailing revenue of $608 million in 2013 was flat compared to 2012 as higher equipment sales, supplies sales and financing
revenue were offset by lower rental revenue. Equipment sales increased 1% compared to last year primarily due to higher sales in France
and Germany, partially offset by lower sales in the U.K. Supplies revenue increased 3% due to a stabilization in our international meter
population, favorable pricing in the U.K. and higher sales in Asia-Pacific. Rentals revenue declined 8% primarily due to a change in mix
from rental to equipment sales in France. EBIT decreased 6% to $72 million in 2013 compared to 2012 primarily due to higher equipment
costs.
International Mailing revenue decreased 8% in 2012 to $608 million compared to 2011, but included an unfavorable impact of 5% from
foreign currency translation. Excluding the effects of foreign currency, equipment sales decreased 5% primarily due to increased concerns
about economic conditions throughout Europe and the Asia Pacific region, and rentals revenue decreased 10% compared to the prior year
primarily due to the change in mix from rentals to equipment sales in France and lower rentals in the U.K. EBIT decreased 18% to $76
million in 2012 compared to 2011 primarily due to an increase in the mix of lower margin product sales. Foreign currency translation
unfavorably impacted EBIT by 5%.