Pitney Bowes (NYSE: PBI), a global shipping and mailing company that provides technology, logistics, and financial services, today announced its financial results for the first quarter 2022.
“Our first quarter performance was very good and marks a continuation of the trend that we were on for most of last year,” said Marc B. Lautenbach, President and CEO of Pitney Bowes. “We saw substantial margin expansion in our Global Ecommerce business and excellent execution in our SendTech and Presort businesses. Importantly, Global Ecommerce recorded its highest quarterly gross margin ever and SendTech and Presort, in aggregate, once again grew top line in the first quarter.”
Financial Highlights
- Revenue in the quarter was $927 million, an increase of 1 percent from the comparable quarter in 2021
- GAAP EPS in the quarter was $0.12; Adjusted EPS was $0.08 versus $0.07 in first quarter 2021
- Adjusted EBIT in the quarter was $53 million, an increase of 6 percent from the comparable quarter in 2021
- GAAP cash from operations in the quarter was $11 million
- Free cash flow was a net use of $30 million versus a net use of $1 million in first quarter 2021; year-over-year decrease was driven primarily by changes in working capital
- Debt reduced by $99 million during the quarter, primarily through the early redemption of the 2023 Notes
Business Highlights
- Improved Global Ecommerce EBIT margins by over 300 basis points on a year-over-year basis with positive EBITDA
- Processed 41 million domestic standard delivery and return parcels through our Global Ecommerce network in the quarter compared to 42 million parcels in first quarter 2021
- Implemented additional network enhancements in Global Ecommerce that are expected to drive meaningful service and efficiency benefits
- Grew Presort revenue 12 percent on a year-over-year basis
- Processed 4.4 billion pieces through our Presort network in the quarter
- Launched a new state-of-the-art Presort facility in Las Vegas capable of processing all portfolio products
- Reported SendTech revenue decline of 3 percent, with a 3 percent increase in equipment revenue from the comparable quarter in 2021
- Increased shipping-related revenue in SendTech 26 percent on year-over-year basis
- Launched PitneyShip Pro, a new enterprise-oriented, cloud-based sending solution with combined shipping and mailing capabilities
Earnings per share results are summarized in the table below
|
|
First Quarter |
|||
|
|
2022 |
2021 |
||
|
GAAP EPS |
$0.12 |
($0.18) |
||
|
Discontinued Operations |
– |
$0.02 |
||
|
GAAP EPS from Continuing Operations |
$0.12 |
($0.16) |
||
|
Loss on Debt Redemption/Refinancing |
$0.02 |
$0.22 |
||
|
Restructuring Charges |
$0.02 |
$0.01 |
||
|
Gain on Sale of Assets/Business |
($0.08) |
– |
||
|
Transaction Costs |
$0.01 |
– |
||
|
Adjusted EPS |
$0.08 |
$0.07 |
||
* The sum of the earnings per share may not equal the totals due to rounding.
Business Segment Reporting
Global Ecommerce
Global Ecommerce provides business to consumer logistics services for domestic and cross border delivery, returns and fulfillment.
|
|
First Quarter |
|||||||
|
($ millions) |
2022 |
2021 |
% Change Reported |
% Change Ex Currency |
||||
|
Revenue |
$419 |
$413 |
1% |
1% |
||||
|
EBITDA |
$8 |
($8) |
>100% |
|
||||
|
EBIT |
($14) |
($26) |
48% |
|
||||
Revenue growth benefited from better pricing, partially offset by lower volumes. Improvements in EBITDA and EBIT were primarily driven by higher domestic parcel revenues as well as efficiency gains in transportation and improvements in labor productivity.
Presort Services
Presort Services provides sortation services to qualify large volumes of First Class Mail, Marketing Mail, Marketing Mail Flats and Bound Printed Matter for postal workshare discounts.
|
|
First Quarter |
|||||||
|
($ millions) |
2022 |
2021 |
% Change Reported |
% Change Ex Currency |
||||
|
Revenue |
$161 |
$143 |
12% |
12% |
||||
|
EBITDA |
$26 |
$27 |
(2%) |
|
||||
|
EBIT |
$20 |
$19 |
3% |
|
||||
Revenue growth driven by continued improvement in net revenue per piece along with expansion in marketing mail volumes. EBITDA and EBIT margins declined in the quarter due to higher labor and transportation costs.
SendTech Solutions
Sending Technology Solutions offers physical and digital mailing and shipping technology solutions, financing, services, supplies and other applications for small and medium businesses to help simplify and save on the sending, tracking and receiving of letters, parcels and flats.
|
|
First Quarter |
|||||||
|
($ millions) |
2022 |
2021 |
% Change Reported |
% Change Ex Currency |
||||
|
Revenue |
$348 |
$359 |
(3%) |
(2%) |
||||
|
EBITDA |
$112 |
$122 |
(9%) |
|
||||
|
EBIT |
$105 |
$114 |
(9%) |
|
||||
A 3 percent increase in Equipment sales and 26 percent increase in shipping-related revenue were more than offset by a 7 percent decrease in both Financing and Support Services. The decline in high-margin Financing and Support Services revenue resulted in lower EBITDA and EBIT.
2022 Expectations
The Company continues to expect annual revenue and adjusted EBIT to grow over prior year in the low-to-mid single digit range. Additionally, we expect to generate similar levels of free cash flow in 2022 as 2021.
The Company will adjust 2022 guidance should macroeconomic conditions warrant.
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