Pitney Bowes(PBI) - 2021 Q3 - Quarterly Report

Part I - Financial Information Financial Statements Presents unaudited Condensed Consolidated Financial Statements for Pitney Bowes Inc., including Statements of Operations, Balance Sheets, and Cash Flows, with detailed notes Condensed Consolidated Statements of Operations Reports Q3 2021 revenue of $875.4 million and net income of $9.1 million, with nine-month revenue at $2.69 billion and a net loss of $2.6 million Key Operating Results (in thousands, except per share data) | Metric | Three Months Ended Sep 30, 2021 | Three Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2020 | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $875,449 | $891,898 | $2,689,849 | $2,525,658 | | Income (loss) from continuing operations | $8,495 | $10,773 | $1,716 | $(208,071) | | Net Income (Loss) | $9,067 | $11,389 | $(2,618) | $(200,423) | | Diluted EPS | $0.05 | $0.07 | $(0.02) | $(1.17) | Condensed Consolidated Balance Sheets Details total assets of $4.95 billion and total liabilities of $4.91 billion as of September 30, 2021, with a decrease in both from year-end 2020 Balance Sheet Summary (in thousands) | Account | September 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Total Current Assets | $1,843,258 | $2,106,923 | | Total Assets | $4,954,614 | $5,220,137 | | Total Current Liabilities | $1,688,762 | $1,870,460 | | Total Liabilities | $4,905,951 | $5,153,742 | | Total Stockholders' Equity | $48,663 | $66,395 | Condensed Consolidated Statements of Cash Flows Reports net cash from operating activities of $216.2 million and a $192.3 million decrease in cash for the nine months ended September 30, 2021 Cash Flow Summary for Nine Months Ended Sep 30 (in thousands) | Activity | 2021 | 2020 | | :--- | :--- | :--- | | Net cash from operating activities | $216,174 | $191,166 | | Net cash from investing activities | $(111,686) | $(115,741) | | Net cash from financing activities | $(291,849) | $(197,908) | | Change in cash and cash equivalents | $(192,301) | $(125,265) | Notes to Condensed Consolidated Financial Statements Provides detailed disclosures on accounting policies, segment revenue, debt refinancing, and subsequent events, including a facility sale and an acquisition - The company operates as a global shipping and mailing provider, offering technology, logistics, and financial services[14] - The cash flow statement for September 30, 2020, was revised to reclassify certain cash flows, with no material impact on prior statements[16] - Subsequent to quarter-end, the company agreed to sell a facility for approximately $50 million and acquired CrescoData for $15 million cash[133] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q3 2021 financial results, noting a 2% revenue decline driven by Global Ecommerce and SendTech, partially offset by Presort Services, and details 2021 debt refinancing activities Overview Reviews Q3 2021 performance, noting a 2% total revenue decrease to $875.4 million, driven by declines in Global Ecommerce and SendTech, partially offset by Presort Services Q3 2021 Revenue by Segment vs. Q3 2020 (in thousands) | Segment | Q3 2021 Revenue | Q3 2020 Revenue | Actual % Change | | :--- | :--- | :--- | :--- | | Global Ecommerce | $398,011 | $409,981 | (3)% | | Presort Services | $139,296 | $127,705 | 9% | | SendTech Solutions | $338,142 | $354,212 | (5)% | | Total | $875,449 | $891,898 | (2)% | Q3 2021 Segment EBIT vs. Q3 2020 (in thousands) | Segment | Q3 2021 EBIT | Q3 2020 EBIT | % Change | | :--- | :--- | :--- | :--- | | Global Ecommerce | $(20,950) | $(19,757) | (6)% | | Presort Services | $21,062 | $14,481 | 45% | | SendTech Solutions | $98,950 | $112,599 | (12)% | | Total Segment EBIT | $99,062 | $107,323 | (8)% | Outlook Provides full-year 2021 revenue growth expectations in the low to mid-single-digit range, acknowledging ongoing uncertainties from COVID-19 and supply chain issues - The company anticipates full-year 2021 revenue growth in the low to mid-single-digit range[142] - Ongoing supply chain issues and their impact on client demand are noted as key uncertainties[141] Liquidity and Capital Resources Details $743 million in cash and equivalents, sufficient liquidity for 12 months, and significant 2021 debt refinancing activities to extend maturities - Cash, cash equivalents, and short-term investments totaled $743 million at quarter-end[170] - In 2021, the company issued $400 million in notes due 2027, $350 million in notes due 2029, and a new $450 million term loan due 2028, using proceeds to repay earlier debt maturities[175] - Cash from operating activities for the first nine months of 2021 was $216 million, an increase of $25 million from the prior year[172] Quantitative and Qualitative Disclosures About Market Risk Reports no material changes to market risk disclosures from the 2020 Annual Report on Form 10-K - There were no material changes to the disclosures about market risk from the company's 2020 Annual Report[178] Controls and Procedures Management concluded disclosure controls and procedures were effective as of September 30, 2021, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that disclosure controls and procedures were effective as of the end of the reporting period[180] - No material changes in internal control over financial reporting occurred during the quarter[180] Part II - Other Information Legal Proceedings The company is involved in various legal actions, with management assessing no material impact on financial position, results, or cash flows - Management believes potential liability from pending legal actions will not materially affect the company's financial position, results of operations, or cash flows[120][183] Risk Factors Reports no material changes to the risk factors previously identified in the 2020 Annual Report on Form 10-K - There were no material changes to the risk factors identified in the 2020 Annual Report[184] Unregistered Sales of Equity Securities and Use of Proceeds Details Board authorization for up to $16 million in common stock repurchases, with no repurchases made during 2021 - The company has authorization to repurchase up to $16 million of its common stock, but no repurchases were made during 2021[184] Exhibits Lists exhibits filed with Form 10-Q, including indentures for new debt, CEO and CFO certifications, and Inline XBRL financial data files - Exhibits filed include indentures for the 6.875% Senior Notes due 2027 and 7.250% Senior Notes due 2029[186] - Certifications from the CEO and CFO pursuant to SEC rules and the Sarbanes-Oxley Act are included as exhibits[186]