GAAP cash from operations during the quarter was $137 million while free cash flow was $119 million. In comparison to the prior year, free cash flow declined due to timing of accounts payable.
During the quarter, the Company used cash to pay $35 million in dividends to common shareholders, $25 million for the Maponics acquisition and $17 million for restructuring payments.
Debt Management
During the quarter, the Company issued $600 million of 3.375 percent 5-year fixed rate notes. The issuance will be a debt neutral transaction as the Company paid down commercial paper outstanding during the quarter and is redeeming all $300 million of outstanding shares of the Pitney Bowes International Holdings preferred stock on November 1, 2016.
Business Segment Reporting
The Company’s business segment reporting reflects the clients served in each market and the way it manages these segments for growth and profitability. The reporting segment groups are the SMB Solutions group; the Enterprise Business Solutions group; and the Digital Commerce Solutions group. The segment results for the quarter and prior year may not equal the subtotals for each segment group due to rounding.
The SMB Solutions group offers mailing equipment, financing, services and supplies for small and medium businesses to efficiently create mail and evidence postage. This group includes the North America Mailing and International Mailing segments. North America Mailing includes the operations of U.S. and Canada Mailing. International Mailing includes all other SMB operations around the world.
The Enterprise Business Solutions group includes the global Production Mail and Presort Services segments. Production Mail provides mailing and printing equipment and services for large enterprise clients to process mail. Presort Services provides sortation services to qualify large mail volumes for postal worksharing discounts.
The Digital Commerce Solutions group includes the Software Solutions and Global Ecommerce segments. Software Solutions provide customer engagement, customer information and location intelligence software. Global Ecommerce facilitates global cross-border ecommerce transactions and shipping solutions for businesses of all sizes.
SMB Solutions Group
| ($ millions) | Third Quarter | |||||||||||||||||||
| Revenue |
2016 |
2015 |
Y/Y
|
Y/Y
|
Y/Y Ex Currency
|
|||||||||||||||
| North America Mailing | $ | 330 | $ | 353 | (7 | %) | (7 | %) | (7 | %) | ||||||||||
| International Mailing | 96 | 105 | (9 | %) | (5 | %) | (3 | %) | ||||||||||||
|
SMB Solutions Total |
$ | 426 | $ | 458 | (7 | %) | (6 | %) | (6 | %) | ||||||||||
| EBIT | ||||||||||||||||||||
| North America Mailing | $ | 139 | $ | 159 | (13 | %) | ||||||||||||||
| International Mailing | 10 | 11 | (9 | %) | ||||||||||||||||
| SMB Solutions Total | $ | 148 | $ | 170 | (13 | %) | ||||||||||||||
| * Excluding $3.1 million related to the impacts of currency and $2.2 million related to the divested revenues resulting from the exit of direct operations in Mexico, South Africa and five markets in Asia. |
