Pitney Bowes Annual Report 2013 1
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Annual Report 2013 The next chapter Pitney Bowes Annual Report 2013 1 Elmcroft Road, Stamford, CT 06926-0700 203.356.5000 www.pb.com 44676_CVRA.indd cov4-cov2 3/13/14 11:18 AM Innovation to enable commerce has been Stockholder Information World Headquarters Transfer Agent and Registrar an essential part of the Pitney Bowes story Pitney Bowes Inc. Computershare 1 Elmcroft Road, Stamford, CT 06926-0700 PO Box 30170 for over 93 years. In 2013, we began the 203.356.5000 College Station, TX 77842-3170 www.pb.com Stockholders may call Computershare at (800) 648-8170 www.computershare.com Annual Meeting next chapter of our story with a focus on Stockholders are cordially invited to attend the Annual Stockholder Inquiries Meeting at 9:00 a.m., Monday, May 12, 2014, at Pitney Bowes To provide or obtain information concerning transfer World Headquarters in Stamford, Connecticut. Notice of the requirements, lost certifi cates, dividends, changes of address innovation driven by our clients’ needs as meeting will be mailed or made available to stockholders and other matters, please call: (800) 648-8170, TDD phone of record as of March 14, 2014. Please refer to the Proxy service for the hearing impaired (800) 952-9245, for foreign they navigate the complexities of global Statement for information concerning admission to the meeting. holders (781) 575-2721; or write to the address above. 10-K Report Dividend Reinvestment Plan Included in this Annual Report to Stockholders is a copy Owners of Pitney Bowes Inc. common stock may purchase commerce in the 21st century. We are off of our Annual Report on Form 10-K for the fi scal year common stock, $1 par value, with their dividends through the ended December 31, 2013, as fi led with the Securities Dividend Reinvestment Plan. A prospectus and enrollment and Exchange Commission, and can be viewed at http:// card may be obtained by calling (800) 648-8170 or by writing to a good start and more opportunity lies www.investorrelations.com. This Annual Report contains to the agent at the address above. statements that are forward-looking. These statements are Direct Deposit of Dividends based on current expectations and assumptions that are For information about direct deposit of dividends, please call ahead. Our people are pulling together as subject to risks and uncertainties. Actual results could differ (800) 648-8170 or write to the agent at the address above. materially because of factors discussed in the Forward- a team, executing on our strategies, and Looking Statements section of the Form 10-K. The CEO/CFO Duplicate Mailings certifi cations required to be fi led with the SEC under Section If you receive duplicate mailings because you have more than 302 of the Sarbanes-Oxley Act of 2002 were fi led as exhibits one account listing, you may wish to save your company money enabling clients to use our technologies to our Annual Report on Form 10-K for the fi scal year ended by consolidating your accounts. Please call (800) 648-8170 or December 31, 2013. The CEO certifi cation required to be write to the agent at the address above. submitted to the NYSE pursuant to Section 303A.12(a) of the Stock Information NYSE Listed Company Manual was submitted on June 7, 2013. and know-how to compete in their markets. Dividends per common share: Copies of our Form 10-K are available to stockholders without Quarter 2013 2012 With the foundation that we have and the charge upon written request to: Investor Relations First $ .375 $ .375 Pitney Bowes Inc. Second $ .1875 $ .375 1 Elmcroft Road, Stamford, CT 06926-0700 Third $ .1875 $ .375 transformation we have begun, the next Fourth $ .1875 $ .375 Stock Exchanges Total $ .9375 $ 1.50 Pitney Bowes common stock is traded under the symbol chapter promises to be a good one. “PBI.” The principal market on which it is listed is the New Quarterly price ranges of common stock: York Stock Exchange. The stock is also traded on the Chicago, 1113 Philadelphia, Boston, Pacifi c and Cincinnati stock exchanges. 2013 Quarter High Low Investor Inquiries First $ 15.56 $ 10.71 AD12031 Second $ 16.43 $ 13.12 All investor inquiries about Pitney Bowes should be addressed to: Third $ 18.82 $ 13.76 Investor Relations Fourth $ 24.18 $ 18.21 reserved Pitney Bowes Inc. 2012 Quarter High Low rights 1 Elmcroft Road, Stamford, CT 06926-0700 First $ 19.65 $ 17.45 All Comments concerning the Annual Report Second $ 17.87 $ 12.81 Inc. should be sent to: Third $ 15.27 $ 12.64 Corporate Financial Communications Fourth $ 14.73 $ 10.34 Bowes Pitney Bowes Inc. Pitney 1 Elmcroft Road, Stamford, CT 06926-0700 ©2014 York New Sequel, Pitney Bowes, the Corporate logo, SendSuite Live, Spectrum and Volly are trademarks of Pitney Bowes Inc. or a subsidiary. The materials used in this publication are recyclable. ™ ® Design: All other trademarks are the property of their respective owners. The paper is certifi ed to Forest Stewardship Council (FSC ) standards. 44676_CVRA.indd cov3-cov5 3/19/14 3:19 PM Marc B. Lautenbach President and Chief Executive Offi cer Michael Monahan Executive Vice President and Chief Financial Offi cer Fellow shareholders: In my note to shareholders last year, just four months after becoming CEO, I wrote that I came to Pitney Bowes because I saw a company with enormous promise and unique strengths — a company with immense opportunities ahead if we could make the right strategic choices and execute with discipline. We made a good start in 2013. We outlined a strategy to unlock the inherent value of Pitney Bowes for our clients, shareholders, and employees worldwide. That strategy entails focusing on execution in three areas: stabilizing our mail business, driving operational excellence, and accelerating our growth. We have made progress on all three fronts — progress that at this early stage exceeds expectations. Our people have pulled together, across every corner of our business, in every region of the world, making tough decisions, improving how we do business, and innovating based on our obvious strengths: from our best-in-class technologies, to our global client base, to our market-leading position in the modern mailing industry we helped to invent. While you can measure our progress in many ways, the most obvious is our fi nancial performance — including a higher stock price and a stronger balance sheet, which are refl ections of what we’ve accomplished. In our effort to stabilize the mailing business, we increased the rate of growth in our enterprise business while moderating the decline in our SMB business. Through operational effi ciencies, as well as a new go-to-market strategy in our SMB business, we reduced SG&A expenses by $71 million in 2013, while reducing our debt by $675 million. In addition, we saw a signifi cant boost in the business that serves the fastest-growing markets, Digital Commerce, increasing year-over-year revenue by 18 percent on a constant currency basis in the fourth quarter. A fi nancial analyst who covers us recently wrote that our company’s “impressive execution on its stated goals … has begun to manifest in results.” I know that we have much further to go, but I couldn’t agree more. Pitney Bowes Annual Report 2013 1 44676_EDS.indd 1 3/19/14 3:26 PM Letter to Shareholders Senior Management Team (left to right) Bill Hughes, Lila Snyder, Christoph Stehmann, (left to right) Deborah Pfeiffer, Mark Wright, Daniel Goldstein, Abby Kohnstamm, Roger Pilc, and Mark Shearer Joseph Schmitt, and Johnna Torsone Since arriving last year at Pitney Bowes, I have been impressed by our capacity for transformation, and I am pleased with the way the company has risen to the challenge. Our progress is the result of many things, but most of all, the actions of our people, as well as the goodwill of 1.5 million clients in more than 100 countries, who believe very strongly in the value we are able to offer. As realists, we know the road is long and that living up to our promise is not a sprint, but a journey. Nevertheless, we believe our results are clear evidence that we are on the right track and in excellent position to capture opportunities that seem tailor-made for Pitney Bowes. By continuing to stabilize the mailing business, we create the opportunity to strengthen the businesses that will be the fi nancial foundation of our company for the foreseeable future. As we improve our operations, we have the opportunity to create a level of client service and satisfaction that, globally, is second to none, while becoming even more effi cient. Finally, by continuing to support global commerce through a unique range of enabling solutions, we have a clear capacity for accelerated growth, particularly in the digital world. Overall, digital commerce represents a $40 billion market opportunity. It is a burgeoning sector that, in many ways (and in many places), is just getting started. Client-focused innovation At Pitney Bowes, when we discuss our objectives and how, as a company, we will achieve them, the words that come to mind — innovation, value, client focus — are hardly uncommon. However, for us, they have very specifi c and very powerful meaning. They are fundamental to our culture, they are the bedrock of our strategy, and they are the touchstones of our future success. Innovation, for example, is not merely a matter of having good ideas that no one else has thought of. It is the creation of something new at the intersection of business insight and invention — that is, the place where our own ideas cross paths with what clients actually say they need.