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Pitney Bowes Restructures Top Management

Zacks Equity Research

Pitney Bowes Inc.(PBI) announced that it has delegated the responsibilities for the newly-created position of Vice President, Global Client Services division to Kevin Connolly, who was the former Vice President of its strategic transformation division.

After assuming the present charge, Connolly will be leading a number of client service activities of the company, like call centers, supply chain, and information technology groups along with the client field service in multiple locations of North America and Europe. During his more than 30 years of long journey with Pitney Bowes, Kevin has made his way up the corporate ladder handling different responsibilities within the organization. Connolly will report directly to the President and CEO Marc Lautenbach, who is very optimistic about Kevin’s appointment.

A few days back Pitney Bowes appointed James Brayshaw as the Director and GM of its Location Intelligence (:LI) and GIS division. James, a chartered civil engineer with 30 years of rich experience, had been handling the significant role of the board of directors of Ordinance Survey.

Pitney Bowes has been experiencing impressive improvements in its LI and GIS division revenues in recent times. The primary reason behind this rise is the ability of a certain software to present geospatial data, which helps in understanding the specific relationships between locations. This also helps organizations in making more informed strategic business decisions and in identifying specific location-based growth opportunities.

In fourth quarter 2012, Pitney Bowes outperformed the Zacks Estimates by 7.69%.  This achievement can be largely ascribed to James’ experience in leading the LI based solutions in Infrastructure, Central and Local Government, Health, Security, Insurance, Land and Property, Utilities, Telecoms and Retail markets in the UK. The company currently expects to see a rise in the divisional performance in the imminent quarters. The appointment of an expert also confirms the company’s strong intension and dedication to promote this segment forward, thereby efficiently supporting customer needs.

The company’s EBIT margin in the software segment increased significantly versus the prior year by 172% due to revenue growth and the benefits of productivity initiatives. In its 2013 outlook, Pitney Bowes also appeared to be hopeful about a revenue growth in its Enterprise Solutions Group. It has further plans to make continued investments in its growth initiatives that will likely result in higher expenses in the first half of the year, but will eventually lead to greater revenue and margin contribution in the second half.

Pitney Bowes currently has a Zacks Rank #4 (Sell). Some other companies in the industry that are worth considering include Konica Minolta Holdings Inc. (KNCAF), Lexmark International Inc. (LXK) andRicoh Company, Ltd. (RICOY), each carrying a Zacks Rank # 3 (Hold).

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