In North America Mailing there continued to be increased placements of the company’s Connect+ TM mailing systems during the quarter. However, overall equipment sales declined due to increased economic uncertainty. This has led some customers to postpone upgrades and purchases of new equipment and caused more customers to extend their leases when compared with the prior year. Lease extensions are profitable transactions but generate less sales revenue than new equipment leases. Rentals revenue was adversely impacted by fewer new business placements. Financing revenue declined, as expected, because of lower equipment sales in prior periods.
EBIT margin for the segment improved by 50 basis points versus the prior year. EBIT continues to benefit from ongoing productivity initiatives and the impact of extensions of equipment leases.
|3Q 2011||Y-O-Y Change||Change ex Currency|
|EBIT||$ 25 million||34%|
International Mailing revenue grew on a reported basis, but declined
slightly excluding the impact of foreign currency when compared with the
prior year. Equipment sales for the segment benefited during the
quarter, in part from increased equipment sales in France and a
contribution from recent Connect+™ launches. However, these positive
equipment sales trends were offset by fewer upgrades and lower sales of
other equipment in the UK and some parts of Europe because of the
ongoing economic uncertainty throughout the region. Recurring revenue
streams were nearly flat, compared to the prior year, due to an
increasing percentage of equipment that is being leased and improving