US Pitney Bowes profit rises on growing demand
Office document management company Pitney Bowes Inc, the No. 1 postal equipment maker, has said its first-quarter profit and revenue rose, fueled by improved demand for its mail and postage services, particularly from small businesses.
Stamford, Connecticut-based Pitney Bowes, whose meters are a mainstay in corporate offices, said net income rose to USD126.6 million, or 54 cents a share, from USD113.6 million, or 48 cents a share, a year earlier.
Excluding costs related to restructuring, it posted a profit of 58 cents a share. Analysts had on average forecast earnings of 56 cents a share, according to Reuters Research, a unit of Reuters Group Plc.
Pitney Bowes Chief Financial Officer Bruce Nolop said the company, which had in previous quarters noted that some customers were putting off new purchases, is seeing greater interest in digital systems and mail creation products.
“We definitely are seeing signs of improved economic conditions,” he said in an interview. “(There was) a significant increase in supplies revenue and growth in our international markets not only because of currency.”
Revenue grew 7 percent to USD1.17 billion from USD1.09 billion. Sales in the United Kingdom, Canada and Japan were all strong, driven by the recent introduction of new digital mailing systems, and the weak dollar, which boosts the value of overseas sales when they are converted from local currency.
STOCK HITS 2-YEAR HIGH
Pitney Bowes counts on its robust revenue stream to remain popular with investors, who see it as a safe haven, since about 77 percent of its revenue comes from repeat customers. Its growth plans have included expanding sales of digital office machines and related services.
“They seem to be benefiting from their digital mailing systems and they are focused on their acquisition strategy,” said analyst Shannon Cross of independent research firm Cross Research. “The revenue growth is fairly impressive.”
Shares of Pitney Bowes edged up to USD43.76 in after-hours trade. Earlier in the day, the stock climbed to USD44.48, its highest level since April 2002, before closing at USD43.73, off 70 cents, or 1.6 percent, on the New York Stock Exchange.
