-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VKgJFAEYjmuaA7y9gZWBl6Ysd246lzXnYOtGnUoM8UFipx3UGZ3kKmIvZPbhUyxc BSKg2x5Twfdm9BCar6fVUQ== 0000930413-06-005316.txt : 20060720 0000930413-06-005316.hdr.sgml : 20060720 20060720171835 ACCESSION NUMBER: 0000930413-06-005316 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060714 ITEM INFORMATION: Completion of Acquisition or Disposition of Assets ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060720 DATE AS OF CHANGE: 20060720 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PITNEY BOWES INC /DE/ CENTRAL INDEX KEY: 0000078814 STANDARD INDUSTRIAL CLASSIFICATION: OFFICE MACHINES, NEC [3579] IRS NUMBER: 060495050 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-03579 FILM NUMBER: 06972391 BUSINESS ADDRESS: STREET 1: WORLD HEADQUARTERS 61-11 STREET 2: ONE ELMCROFT ROAD CITY: STAMFORD STATE: CT ZIP: 06926 BUSINESS PHONE: 2033565000 8-K 1 c43506_8k.txt ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 JULY 20, 2006 (JULY 14, 2006) Date of Report (Date of earliest event reported) PITNEY BOWES INC. (Exact name of registrant as specified in its charter) DELAWARE 1-3579 06-0495050 (State or other jurisdiction of (Commission file number) (I.R.S. Employer incorporation or organization) Identification No.) WORLD HEADQUARTERS 1 ELMCROFT ROAD STAMFORD, CONNECTICUT 06926-0700 (Address of principal executive offices) (203) 356-5000 (Registrant's telephone number, including area code) NOT APPLICABLE (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [_] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [_] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [_] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) SECTION 2 - FINANCIAL INFORMATION ITEM 2.01. COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS On July 14, 2006, Pitney Bowes Inc. ("Pitney Bowes") completed the sale of its Capital Services external financing business pursuant to the sale of all of the outstanding shares of Pitney Bowes Credit Corporation (PBCC), which was a wholly-owned subsidiary of Pitney Bowes to JCC Management LLC, an affiliate of Cerberus Capital Management L.P. (the "Purchaser"). Net of transaction expenses, Pitney Bowes received approximately $750 million from the disposition of the business. In addition, the Purchaser assumed approximately $470 million of Pitney Bowes' non-recourse debt and other liabilities in connection with this transaction. The sale was completed in accordance with the terms of the Stock Purchase Agreement, dated May 16, 2006, by and between Pitney Bowes and the Purchaser (the "Purchase Agreement"). Other than in respect of the Purchase Agreement and the agreements entered into in connection therewith, there are no material relationships between Pitney Bowes and its affiliates, on the one hand, and the Purchaser, and its respective affiliates, on the other hand. Pitney Bowes' press release dated July 17, 2006 announcing the completion of the sale is attached hereto as Exhibit 99.1 and incorporated herein by reference. ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS (b) Proforma Financial Information The following unaudited pro forma consolidated balance sheet as of March 31, 2006 and the unaudited consolidated statements of income for the years ended December 31, 2005, 2004, and 2003 and the three months ended March 31, 2006 and 2005, have been prepared to present the consolidated financial position and the consolidated results of operations of Pitney Bowes as if the sale of its Capital Services external financing business had occurred on March 31, 2006 for the unaudited pro forma consolidated balance sheet and at the beginning of each period presented for the unaudited pro forma consolidated statements of income. The unaudited pro forma financial information was prepared in accordance with Article 11 of Regulation S-X. The unaudited pro forma consolidated financial statements should be read together with Pitney Bowes' historical consolidated financial statements in the Quarterly Report on Form 10-Q for the three months ended March 31, 2006 and in the Annual Report on Form 10-K for the year ended December 31, 2005. The unaudited pro forma consolidated financial statements are presented for illustrative purposes only and, therefore, are not necessarily indicative of the operating results and financial position that may occur in the future. PITNEY BOWES INC. UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET MARCH 31, 2006 (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)
As reported Capital Services As adjusted ----------------------------------------------------- ASSETS Current assets: Cash and cash equivalents $ 195,341 $ (727,930)(A) $ 923,271 Short-term investments 70,795 70,795 Accounts receivables, less allowances: -- 3/06, $46,646; 12/05, $46,261 660,270 660,270 Finance receivables, less allowances: -- 3/06, $56,488; 12/05, $52,622 . 1,425,953 52,500 1,373,453 Inventories 225,870 225,870 Other current assets and prepayments 215,225 3,011 212,214 ---------------------------------------------------- Total current assets 2,793,454 (672,419) 3,465,873 Property, plant and equipment, net 615,544 143 615,401 Rental property and equipment, net 1,006,466 535,931 470,535 Property leased under capital leases, net 2,673 2,673 Long-term finance receivables, less allowances: -- 3/06, $70,133; 12/05, $76,240 1,831,442 186,133 1,645,309 Investment in leveraged leases 1,413,717 1,169,379 244,338 Goodwill 1,646,883 1,646,883 Intangible assets, net 349,564 349,564 Other assets 928,719 1,941 926,778 ---------------------------------------------------- Total assets $10,588,462 $ 1,221,108 $ 9,367,354 ==================================================== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued liabilities $ 1,453,641 $ 16,812 $ 1,436,829 Income taxes payable 85,806 (977,000)(B) 1,062,806 Notes payable and current portion of long-term obligations 894,232 33,820 860,412 Advance billings 496,534 496,534 ---------------------------------------------------- Total current liabilities 2,930,213 (926,368) 3,856,581 Deferred taxes on income 1,907,769 1,260,000 647,769 Long-term debt 3,778,208 434,381 3,343,827 Other noncurrent liabilities 313,673 32,890 280,783 ---------------------------------------------------- Total liabilities 8,929,863 800,903 8,128,960 ---------------------------------------------------- Preferred stockholders' equity in a subsidiary company 310,000 310,000 Total stockholders' equity 1,348,599 420,205(C) 928,394 ---------------------------------------------------- Total liabilities and stockholders' equity $10,588,462 $ 1,221,108 $ 9,367,354 ====================================================
See accompanying notes to unaudited pro forma consolidated financial statements. PITNEY BOWES INC. UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER 31, 2005 (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)
As reported Capital Services(D) Adjustments(E) As adjusted ------------------------------------------------------------------------ Revenue from: Sales $ 1,633,348 $ -- $ -- $ 1,633,348 Rentals 801,285 -- -- 801,285 Financing 650,226 -- -- 650,226 Support services 791,360 -- -- 791,360 Business services 1,477,459 -- -- 1,477,459 Capital Services 138,505 81,725 -- 56,780 ------------------------------------------------------------------------ Total revenue 5,492,183 81,725 -- 5,410,458 ------------------------------------------------------------------------ Costs and expenses: Cost of sales 711,373 -- 1,844 713,217 Cost of rentals 165,963 -- -- 165,963 Cost of support services 407,044 -- 796 407,840 Cost of business services 1,194,649 -- 1,112 1,195,761 Selling, general and administrative 1,685,419 35,150 22,526 1,672,795 Research and development 164,806 -- 945 165,751 Restructuring charge 53,650 -- -- 53,650 Other expense 33,897 25,226 -- 8,671 Interest, net 208,258 11,465 -- 196,793 ------------------------------------------------------------------------ Total costs and expenses 4,625,059 71,841 27,223 4,580,441 ------------------------------------------------------------------------ Income from continuing operations before income taxes 867,124 9,884 (27,223) 830,017 Provision for income taxes 340,546 (7,279) (9,256) 338,569 ------------------------------------------------------------------------ Income from continuing operations $ 526,578 $ 17,163 $ (17,967) $ 491,448 EPS Impact: Basic $ 2.30 $ 0.07 $ (0.08) $ 2.15 Diluted $ 2.27 $ 0.07 $ (0.08) $ 2.12
See accompanying notes to unaudited pro forma consolidated financial statements. PITNEY BOWES INC. UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER 31, 2004 (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)
As reported Capital Services(D) Adjustments(E) As adjusted ---------------------------------------------------------------------------- Revenue from: Sales $ 1,462,967 $ -- $ -- $ 1,462,967 Rentals 804,351 -- -- 804,351 Financing 597,792 -- -- 597,792 Support services 680,702 -- -- 680,702 Business services 1,270,113 -- -- 1,270,113 Capital Services 141,515 84,652 -- 56,863 ---------------------------------------------------------------------------- Total revenue 4,957,440 84,652 -- 4,872,788 ---------------------------------------------------------------------------- Costs and expenses: Cost of sales 663,584 -- 2,025 665,609 Cost of rentals 164,074 -- -- 164,074 Cost of support services 353,658 -- 874 354,532 Cost of business services 1,046,747 -- 1,220 1,047,967 Cost of Capital Services 13,017 13,017 -- -- Selling, general and administrative 1,506,308 20,637 24,732 1,510,403 Research and development 159,835 -- 1,038 160,873 Restructuring charge 157,634 -- -- 157,634 Other expense 19,666 -- -- 19,666 Interest, net 173,469 10,753 -- 162,716 ---------------------------------------------------------------------------- Total costs and expenses 4,257,992 44,407 29,889 4,243,474 ---------------------------------------------------------------------------- Income from continuing operations before income taxes 699,448 40,245 (29,889) 629,314 Provision for income taxes 218,922 2,538 (11,358) 205,026 ---------------------------------------------------------------------------- Income from continuing operations $ 480,526 $ 37,707 $ (18,531) $ 424,288 EPS Impact: Basic $ 2.08 $ 0.16 $ (0.08) $ 1.84 Diluted $ 2.05 $ 0.16 $ (0.08) $ 1.81
See accompanying notes to unaudited pro forma consolidated financial statements. PITNEY BOWES INC. UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER 31, 2003 (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)
As reported Capital Services(D) Adjustments(E) As adjusted -------------------------------------------------------------------------- Revenue from: Sales $ 1,325,490 $ -- $ -- $ 1,325,490 Rentals 785,130 -- -- 785,130 Financing 575,574 -- -- 575,574 Support services 617,800 -- -- 617,800 Business services 1,119,146 -- -- 1,119,146 Capital Services 153,713 98,380 -- 55,333 -------------------------------------------------------------------------- Total revenue 4,576,853 98,380 -- 4,478,473 -------------------------------------------------------------------------- Costs and expenses: Cost of sales 611,620 -- 2,385 614,005 Cost of rentals 170,557 -- -- 170,557 Cost of support services 323,279 -- 1,030 324,309 Cost of business services 921,027 -- 1,438 922,465 Selling, general and administrative 1,396,848 29,959 29,140 1,396,029 Research and development 147,262 -- 1,222 148,484 Restructuring charge 116,713 -- -- 116,713 Other income (117) -- -- (117) Interest, net 168,573 793 -- 167,780 -------------------------------------------------------------------------- Total costs and expenses 3,855,762 30,752 35,215 3,860,225 -------------------------------------------------------------------------- Income from continuing operations before income taxes 721,091 67,628 (35,215) 618,248 Provision for income taxes 226,244 12,365 (13,910) 199,969 -------------------------------------------------------------------------- Income from continuing operations $ 494,847 $ 55,263 $ (21,305) $ 418,279 EPS Impact: Basic $ 2.12 $ 0.24 $ (0.09) $ 1.79 Diluted $ 2.09 $ 0.23 $ (0.09) $ 1.77
See accompanying notes to unaudited pro forma consolidated financial statements. PITNEY BOWES INC. UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME FOR THE THREE MONTHS ENDED MARCH 31, 2006 (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)
As reported Capital Services(D) As adjusted --------------------------------------------------------------- Revenue from: Sales $ 405,778 $ -- $ 405,778 Rentals 196,812 -- 196,812 Financing 174,996 -- 174,996 Support services 194,543 -- 194,543 Business services 386,368 -- 386,368 Capital Services 45,607 28,865 16,742 --------------------------------------------------------------- Total revenue 1,404,104 28,865 1,375,239 --------------------------------------------------------------- Costs and expenses: Cost of sales 177,446 -- 177,446 Cost of rentals 43,539 -- 43,539 Cost of support services 102,615 -- 102,615 Cost of business services 306,326 -- 306,326 Selling, general and administrative 439,865 16,123 423,742 Research and development 41,536 -- 41,536 Restructuring charge 5,597 -- 5,597 Other income (10,599) (10,599) -- Interest, net 65,330 9,071 56,259 --------------------------------------------------------------- Total costs and expenses 1,171,655 14,595 1,157,060 --------------------------------------------------------------- Income from continuing operations before income taxes 232,449 14,270 218,179 Provision for income taxes 78,921 4,532 74,389 --------------------------------------------------------------- Income from continuing operations $ 153,528 $ 9,738 $ 143,790 EPS Impact: Basic $ 0.68 $ 0.04 $ 0.64 Diluted $ 0.67 $ 0.04 $ 0.63
See accompanying notes to unaudited pro forma consolidated financial statements. PITNEY BOWES INC. UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME FOR THE THREE MONTHS ENDED MARCH 31, 2005 (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)
As reported Capital Services(D) As adjusted ---------------------------------------------------------------------- Revenue from: Sales $ 381,427 $ -- $ 381,427 Rentals 201,641 -- 201,641 Financing 157,275 -- 157,275 Support services 194,934 -- 194,934 Business services 349,103 -- 349,103 Capital Services 33,408 18,992 14,416 ---------------------------------------------------------------------- Total revenue 1,317,788 18,992 1,298,796 ---------------------------------------------------------------------- Costs and expenses: Cost of sales 168,221 -- 168,221 Cost of rentals 42,317 -- 42,317 Cost of support services 100,366 -- 100,366 Cost of business services 289,110 -- 289,110 Selling, general and administrative 413,810 7,601 406,209 Research and development 41,778 -- 41,778 Restructuring gain (15,840) -- (15,840) Other expense 10,000 -- 10,000 Interest, net 46,816 3,148 43,668 ---------------------------------------------------------------------- Total costs and expenses 1,096,578 10,749 1,085,829 ---------------------------------------------------------------------- Income from continuing operations before income taxes 221,210 8,243 212,967 Provision for income taxes 75,935 2,865 73,070 ---------------------------------------------------------------------- Income from continuing operations $ 145,275 $ 5,378 $ 139,897 EPS Impact: Basic $ 0.63 $ 0.02 $ 0.61 Diluted $ 0.62 $ 0.02 $ 0.60
See accompanying notes to unaudited pro forma consolidated financial statements. PITNEY BOWES INC. NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS A. Includes net cash proceeds from the sale of approximately $750 million. B. Reflects the current taxes payable of approximately $977 million resulting from the sale. C. Reflects the net after-tax loss upon sale. D. Reflects the removal of Capital Services' results for the period. E. The Company adopted the provisions of SFAS No. 123 (R) (revised 2004), "Share-Based Payments" on January 1, 2006 using the modified retrospective application. These adjustments reflect the impact of SFAS No. 123 (R) as if the adoption had occurred at the beginning of the respective period. (c) Exhibits 99.1 Press release of Pitney Bowes Inc. dated July 17, 2006 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. PITNEY BOWES INC. July 20, 2006 /s/ B.P. Nolop ------------------------------- B.P. Nolop Executive Vice President and Chief Financial Officer (Principal Financial Officer) /s/ S.J. Green ------------------------------- S.J. Green Vice President - Finance and Chief Accounting Officer (Principal Accounting Officer) EX-99.1 2 c43506_ex99-1.txt Exhibit 99.1 PITNEY BOWES COMPLETES THE SALE OF CAPITAL SERVICES BUSINESS STAMFORD, Conn., July 17 /PRNewswire-FirstCall/ -- Pitney Bowes Inc. (NYSE: PBI) announced today that it has completed the sale of its Capital Services external financing business to an affiliate of Cerberus Capital Management, L.P. The new business will operate under the name EntreCap Financial Corporation and will be based in Shelton, Connecticut. "The sale of the Capital Services business is an important milestone for Pitney Bowes customers and shareholders," said Michael J. Critelli, Chairman and CEO of Pitney Bowes. "It enhances our focus on helping businesses and postal services around the world to leverage the mailstream to add value for their customers. The completion of this transaction also gives shareholders a clearer view of the underlying strength and growth of our business." Net of transaction expenses the company will receive approximately $750 million from the disposition of the business. In addition, the purchaser will assume about $470 million of the company's non-recourse debt and other liabilities in connection with this transaction. The proceeds from the sale will be used to pay taxes associated with the Capital Services business. These are deferred tax obligations that have accumulated over the lives of the assets in the portfolio, which become immediately payable upon the sale of the business to a third party. Pitney Bowes engineers the flow of communication. The company is a $5.5 billion global leader of mailstream solutions headquartered in Stamford, Connecticut. For more information about the company, its products, services and solutions, visit http://www.pitneybowes.com/. -----END PRIVACY-ENHANCED MESSAGE-----