PITNEY BOWES INC /DE/PBI

PITNEY BOWES INC /DE/ Debt Disclosure

10-KFiled Feb 19, 20212 min read
Debt
December 31,
Interest rate20202019
Notes due October 20214.875%152,588 600,000 
Notes due May 20225.375%148,792 400,000 
Notes due April 20235.95%271,000 400,000 
Notes due March 20244.625%374,000 500,000 
Notes due January 20375.25%35,841 35,841 
Notes due March 20436.70%425,000 425,000 
Term loan due November 2024
LIBOR + 1.75%
380,000 400,000 
Term loan due January 2025
LIBOR + 5.5%
818,125 — 
Other debt4,900 5,108 
Principal amount2,610,246 2,765,949 
Less: unamortized costs, net45,853 26,227 
Total debt2,564,393 2,739,722 
Less: current portion long-term debt216,032 20,108 
Long-term debt$2,348,361 $2,719,614 

In February 2020, we secured a five-year $850 million term loan maturing January 2025. We entered into interest rate swap agreements with an aggregate notional amount of $500 million to mitigate the interest rate risk associated with $500 million of our variable-rate term loans. Under the terms of the swap agreements, we pay fixed-rate interest of 0.4443% and receive variable-rate interest based on one-month LIBOR. The variable interest rate under the term loans and the swaps reset monthly.

In March 2020, we purchased under a tender offer $428 million of the October 2021 notes, $250 million of the May 2022 notes, $125 million of the April 2023 notes and $125 million of the March 2024 notes. A $37 million loss was incurred on the early redemption of debt.

During 2020, we repaid $52 million of principal related to our term loans. The interest rate for the November 2024 term loan and the January 2025 term loan at December 31, 2020 was 1.9% and 5.65%, respectively. Interest rates on certain notes are subject to adjustment based on changes in our credit ratings. As a result of credit rating downgrades in November 2019 and May 2020, the interest rates on the October 2021 notes and April 2023 notes increased 0.25% in the fourth quarter of 2020.

Annual maturities of outstanding debt at December 31, 2020 are as follows:
2021$216,303 
2022238,471 
2023391,955 
2024750,181 
2025552,495 
Thereafter460,841 
Total$2,610,246 

We have a $500 million secured revolving credit facility that expires in November 2024 and contains financial and non-financial covenants. At December 31, 2020, we were in compliance with all covenants. In April 2020, we borrowed $100 million under this facility and repaid the amount in September 2020. At December 31, 2020 and 2019, there were no borrowings under this facility.
On February 10, 2021, Standard and Poor's downgraded our credit rating and the credit ratings of our secured and unsecured debt. As a result of this downgrade, the interest rates on the May 2022 notes and April 2023 notes will increase 0.25% after their next interest payment date. Further, on February 17, 2021, we announced that on February 22, 2021, we will redeem the October 2021 notes.

Historical Timeline

Fiscal YearFiled
2020Feb 19, 2021Showing above
2019Feb 20, 2020
2018Feb 20, 2019
2017Feb 22, 2018
2016Feb 22, 2017
2015Feb 22, 2016

About Debt Disclosures

Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.

Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.

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