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                                          VALUED INVESTOR
                                          c/o SHERATON HOTEL
                                          811 7TH AVENUE
                                          NEW YORK, NY 10019-6002




                                  Top Investor Questions
                   Investor use onlyUpdate – September 10, 2008
      1   January 2003 PBI internal
Top Investor Questions
Why did the company decide to
retain PBMS and what are the
drivers of growth and profitability?
Retain Pitney Bowes Management Services

•   In best interest of shareholders

•   Grow the business and improve profitability

•   Mine core opportunities such as off-site services and virtual
    mail management

•   Drive growth in newer services such as Critical
    Communication Solutions and Records Management

•   Enhance underperforming areas

•   Continue to improve labor productivity and streamline processes

•   Target 10% EBIT margin
What is the status of the company’s
 restructuring initiatives? Is the
 company on target to get $150
 million in savings?
Transition Initiatives on target


  •   Programs in place to achieve at least $150 million in savings



  •   Plan to invest about half of the anticipated savings in the
      business



  •   Identified approximately 1,700 positions to be eliminated
What is the company’s capital
 allocation policy with regard to
 dividends, share repurchase and
 acquisitions?
Improving levels of free cash flow
                    Average Per Year = $617 million
                                                                    $924*
         $1,000
                                                                              $675 to
                                                                               $750
           $800
                                   $555       $543
                        $540                             $523
           $600


           $400


           $200


               $0
                     2003       2004       2005       2006       2007        2008
                                                                            Forecast

* Includes facility sales, tax refunds and other unusual sources of cash
Consistently increased the dividend
  for 26 years

   = Percent increase
                                                            6%
                                                 3%
   $1.50                                3%
                               2%
                        2%
              2%
                                                          $1.40
                                                $1.32
                                       $1.28
   $1.20             $1.22    $1.24
            $1.20


   $0.90


   $0.60


   $0.30


   $0.00
           2003     2004     2005     2006     2007      2008
                                                        Forecast
Reduced average shares outstanding through
  share repurchases

                 Decline in Shares O
                                     utstanding   = 11%
   300
           236       234      232     225
                                              221         211


   200




   100




     0
         2003     2004     2005     2006    2007     2008 YTD
What are the company’s plans for
 future acquisitions?
Major Acquisitions
                                                                                             $2,552
                                                                                   $594
$2,500

                                                                      $240
$2,000
                                                          $293
                                              $512
$1,500


                                    $135
$1,000
                    $206
         $572
 $500


   $0
         2001        2002           2003        2004        2005      2006         2007       Total

                                                Group 1               Ibis
                    PSI                                    Imagitas
                                    DDD Co.
         Danka                                                                     Mapinfo
                                                Ancora                Consulting
         Services   Siemens         Bryce                  Compulit
                                                Capital &                        Digital Cement
         Int’l                                                        Print Inc.
                    (4 Locations)
                                                Mgmt.
                                    Sure-Feed                         AAS & PMH Asterion SAS
                                                Groupe Mag Danka
         Secap      Mailcode        Engineering                       Emtex
                                                           Canada
Acquisitions have added to earnings

                            2005    2006   2007
  Cumulative Transactions     56     64      84

  Investment (billions)      $1.8   $1.9    $2.6

  Revenue (billions)         $1.3   $1.6    $1.9

  EBITDA (millions)         $178    $210   $267

  EBIT (millions)           $139    $160   $200


  Earnings Per Share         18¢     22¢    24¢
Acquisitions have added to free cash flow

($ in millions)
                                                         $267
          $300

                                    $218
          $250

                    $173
          $200
                                                         $200
                                   $168
          $150
                   $136
          $100

            $50


              $0
                   2005           2006               2007

                           Amortization of Intangibles
                    EBIT
Total Pitney Bowes acquisition spend by
  business unit 2001-2007


                     Mail          Marketing
                   Services         Services
                     14%              13%

                                               U.S. Mailing
                                                   10%

        Software
          32%
                                               PBMS
                                               18%
                        International
                             13%
Acquisition Strategy


•   Focus on strategic acquisitions in adjacent market spaces



•   Use a risk-adjusted hurdle rate and target incremental return
    above that for future acquisitions


•   Fewer, more impactful acquisitions
What will drive growth in the
Mailing business, both in the U.S.
and internationally?
Equipment sales benefit from timing and
   value of maturing leases
U.S. Mailing
 Revenue
  Supplies     15%
    ≈10%
                                       +8.6%
   Service     10%
    ≈15%                       +5.7%
                5%
  Financing
    ≈25%
                0%

                -5%
   Rentals
    ≈25%
               -10%

                      -10.9%
               -15%
    Sales
                      2007     2008    2009
    ≈25%
New mailing products are faster with
   more features

WOW Letters / Minute
                                                                                           DM1100
         145

                                                                                   DM925
         120
                                                                               WJ250
                                                                           DM875
    115 - 120
                                                                       WJ220
                                                                   DM825
         100
                                                            WJ185
                                                         DM575
      90 - 95
                                                IM480
                                                 DM525
      60 - 65
                                   IM460
                                       DM450
           0

                             DM400
           0                IM440

                0      50   100                150               200         250           300
                                   Auto Feed Letters / Minute
                                  Neopost/Hasler Pitney Bowes
                                  A Competitor    Pitney Bowes
International markets offer meter incentives




                                  06




                                                                              08
                                                           07
                 05




                                20




                                                                            20
                                                         20
               20


                                                                                   Ireland
                      UK
   Sweden
(since 2004)

                                   UK Expands                                       UK Expands
                      Finland       Discounts                                        Discounts       Australia

   Holland
(since 2000)
                                                                Singapore
                      Norway
                                                                                                    Spain
                                                France                       Belgium
  Germany
(since 1995)
                                                                                         Denmark

                      Value of metering recognized
                      by international posts
    India
                                                                                                 Canada
(since 1981)
Why does the company do its own
 leasing and incur all the debt?
Customers prefer leasing

•   Convenience of payment


•   Better management of cash


•   Reduced risk if business needs change


•   Reduced risk if technology changes
Benefits of leasing equipment

 12000
                                      1.8x
 10000
                                     Financing
                                      and Fee
  8000
                                                  Financing
                                      Income
                                                   and Fee
           1.0x
  6000                                             Income

                                                   2.0x
  4000                                Sales of
           Sales of
                                    Equipment
         Equipment
                                    and Related
                          1.0x
         and Related                                 Net
  2000                                Services
           Services                                Income
                            Net
                          Income
     0
                                   Leasing Model – 4 Years
         Straight Sale – 6 Years
Lease financing has excellent credit
                     experience
                                                                                                                Avg. Write-offs/
                    Avg. Earning                                                                                Avg. Earning Assets
                    Assets (1)
                                                                                                                                5%
                                                                                                                        573
                                                                                                                553
                                                                                                      473
                                                                                    358       404                               4%
                                                                           317
                                                                    284
                                                          280
                                                 278
                                        235
($ in millions)




                                163
                                                                                                                                3%
                                                                                                                        2,415
                                                                                             2,257              2,479
                                                                                   2,215             2,380
                                                         2,092     2,089   2,161
                                                2,067
                                       1,958
                               1,848


                                                                                                                                2%



                                                                                                                                1%


                                                                                                                                0%
                               1998    1999     2000      2001      2002   2003     2004      2005   2006       2007     2008
                                                                                                                         YTD
                                          Payment Solutions      Leasing       Payment Solutions      Leasing



             (1)   Represents global leasing and Payment Solutions receivables
How does declining mail volume
affect the business? Is the
business being hurt by electronic
substitution for mail?
Impact of declining mail volumes
•   Between 2000 and 2007 mail volumes have moved in the
    range of about +/- 2% per year. Mail volumes are up, on
    average, 0.3% per year over the same period.

•   No significant, immediate impact since what customers pay is
    not based on volume processed

•   Most of the decline in mail volume is in consumer-to-business
    mail which does not impact metered mail

•   Internet generates business through eBay

•   Continue to diversify our business to mitigate the impact of
    declining mail volumes

•   Mail volumes in other parts of the world are growing
We continue to expand into underserved
    areas of the Mailstream


       $7,000
                                                 $6,130
       $6,000
                                                   Other
                          $4,464
       $5,000                                  Pitney Bowes
                                                  Revenue
                                      +73.8%
                          Other
       $4,000                                       62%
                      Pitney Bowes
                         Revenue
       $3,000
                           49%
       $2,000
                       U.S. Mailing            U.S. Mailing
                                       +2.3%
                        Revenue                 Revenue
       $1,000
                           51%                     38%
             $0
                         2003*                   2007

* Excludes discontinued operations.
How does the economy affect the
business? What is the company’s
exposure to the financial services
sector and other business sectors?
Pitney Bowes has performed consistently
    through different economic cycles

                 1,800                                                                       6,500

                 1,600                                                                       5,500

                 1,400                                                                       4,500

                 1,200                                                                       3,500




                                                                                                     R evenues
       EBIT DA




                 1,000                                                                       2,500

                  800                                                                        1,500

                  600                                                                        500

                  400                                                                        (500)
                     87


                          89


                               91


                                    93


                                            95


                                                  97


                                                           99


                                                                  01


                                                                           03


                                                                                  05


                                                                                        07
                    19


                          19


                               19


                                    19


                                            19


                                                  19


                                                          19


                                                                  20


                                                                         20


                                                                                 20


                                                                                        20
                                         EBITDA        Revenues        U.S. Recession


* Includes acquisitions and divestitures.
2007 Pitney Bowes U.S. revenue by industry
   vertical


25%     23%
                   21%
20%


15%                           13%
                                        10%
10%
                                                    6%
                                                              5%        5%        5%
5%                                                                                          4%       4%
                                                                                                               3%
                                                                                                                         2%

0%
                             Mail and    Manu-     Govern-    Other     Retail            Telecoms Transpor- Education    Real
      Financial   Profess-                                                       Whole-
                               Print   facturing    ment     Services                     & Utilities tation             Estate
      Services     ional                                                          sale
                             Providers
                  Service                                                        Trade
2007 U.S. Mailing revenue by industry
   vertical

       29%
30%

25%

20%
                  15%
15%

10%                            8%         8%         8%
                                                               7%       7%
                                                                                 5%        5%
5%                                                                                                   3%         3%
                                                                                                                           2%

0%
                                                              Govern-
                                                    Other                                                        Real    Telecoms &
      Profess-                                                                   Retail
                             Mail and      Manu-
                 Financial                                              Whole-            Education Transpor-
                                                               ment
                                         facturing Services                                                     Estate    Utilities
       ional                   Print
                 Services                                                sale                         tation
      Service                Providers                                  Trade
With the dollar getting stronger,
 how will changes in currency
 impact the company’s results?
Impact of a change in exchange rates


  One percent change in average foreign currency:

         •   Revenue = 0.3%
         •   EPS = $0.01

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Sheraton Hotel Grand Central Station

  • 1. Join us at the Sheraton Hotel only 1 mile from Grand Central Station! VALUED INVESTOR c/o SHERATON HOTEL 811 7TH AVENUE NEW YORK, NY 10019-6002 Top Investor Questions Investor use onlyUpdate – September 10, 2008 1 January 2003 PBI internal
  • 3. Why did the company decide to retain PBMS and what are the drivers of growth and profitability?
  • 4. Retain Pitney Bowes Management Services • In best interest of shareholders • Grow the business and improve profitability • Mine core opportunities such as off-site services and virtual mail management • Drive growth in newer services such as Critical Communication Solutions and Records Management • Enhance underperforming areas • Continue to improve labor productivity and streamline processes • Target 10% EBIT margin
  • 5. What is the status of the company’s restructuring initiatives? Is the company on target to get $150 million in savings?
  • 6. Transition Initiatives on target • Programs in place to achieve at least $150 million in savings • Plan to invest about half of the anticipated savings in the business • Identified approximately 1,700 positions to be eliminated
  • 7. What is the company’s capital allocation policy with regard to dividends, share repurchase and acquisitions?
  • 8. Improving levels of free cash flow Average Per Year = $617 million $924* $1,000 $675 to $750 $800 $555 $543 $540 $523 $600 $400 $200 $0 2003 2004 2005 2006 2007 2008 Forecast * Includes facility sales, tax refunds and other unusual sources of cash
  • 9. Consistently increased the dividend for 26 years = Percent increase 6% 3% $1.50 3% 2% 2% 2% $1.40 $1.32 $1.28 $1.20 $1.22 $1.24 $1.20 $0.90 $0.60 $0.30 $0.00 2003 2004 2005 2006 2007 2008 Forecast
  • 10. Reduced average shares outstanding through share repurchases Decline in Shares O utstanding = 11% 300 236 234 232 225 221 211 200 100 0 2003 2004 2005 2006 2007 2008 YTD
  • 11. What are the company’s plans for future acquisitions?
  • 12. Major Acquisitions $2,552 $594 $2,500 $240 $2,000 $293 $512 $1,500 $135 $1,000 $206 $572 $500 $0 2001 2002 2003 2004 2005 2006 2007 Total Group 1 Ibis PSI Imagitas DDD Co. Danka Mapinfo Ancora Consulting Services Siemens Bryce Compulit Capital & Digital Cement Int’l Print Inc. (4 Locations) Mgmt. Sure-Feed AAS & PMH Asterion SAS Groupe Mag Danka Secap Mailcode Engineering Emtex Canada
  • 13. Acquisitions have added to earnings 2005 2006 2007 Cumulative Transactions 56 64 84 Investment (billions) $1.8 $1.9 $2.6 Revenue (billions) $1.3 $1.6 $1.9 EBITDA (millions) $178 $210 $267 EBIT (millions) $139 $160 $200 Earnings Per Share 18¢ 22¢ 24¢
  • 14. Acquisitions have added to free cash flow ($ in millions) $267 $300 $218 $250 $173 $200 $200 $168 $150 $136 $100 $50 $0 2005 2006 2007 Amortization of Intangibles EBIT
  • 15. Total Pitney Bowes acquisition spend by business unit 2001-2007 Mail Marketing Services Services 14% 13% U.S. Mailing 10% Software 32% PBMS 18% International 13%
  • 16. Acquisition Strategy • Focus on strategic acquisitions in adjacent market spaces • Use a risk-adjusted hurdle rate and target incremental return above that for future acquisitions • Fewer, more impactful acquisitions
  • 17. What will drive growth in the Mailing business, both in the U.S. and internationally?
  • 18. Equipment sales benefit from timing and value of maturing leases U.S. Mailing Revenue Supplies 15% ≈10% +8.6% Service 10% ≈15% +5.7% 5% Financing ≈25% 0% -5% Rentals ≈25% -10% -10.9% -15% Sales 2007 2008 2009 ≈25%
  • 19. New mailing products are faster with more features WOW Letters / Minute DM1100 145 DM925 120 WJ250 DM875 115 - 120 WJ220 DM825 100 WJ185 DM575 90 - 95 IM480 DM525 60 - 65 IM460 DM450 0 DM400 0 IM440 0 50 100 150 200 250 300 Auto Feed Letters / Minute Neopost/Hasler Pitney Bowes A Competitor Pitney Bowes
  • 20. International markets offer meter incentives 06 08 07 05 20 20 20 20 Ireland UK Sweden (since 2004) UK Expands UK Expands Finland Discounts Discounts Australia Holland (since 2000) Singapore Norway Spain France Belgium Germany (since 1995) Denmark Value of metering recognized by international posts India Canada (since 1981)
  • 21. Why does the company do its own leasing and incur all the debt?
  • 22. Customers prefer leasing • Convenience of payment • Better management of cash • Reduced risk if business needs change • Reduced risk if technology changes
  • 23. Benefits of leasing equipment 12000 1.8x 10000 Financing and Fee 8000 Financing Income and Fee 1.0x 6000 Income 2.0x 4000 Sales of Sales of Equipment Equipment and Related 1.0x and Related Net 2000 Services Services Income Net Income 0 Leasing Model – 4 Years Straight Sale – 6 Years
  • 24. Lease financing has excellent credit experience Avg. Write-offs/ Avg. Earning Avg. Earning Assets Assets (1) 5% 573 553 473 358 404 4% 317 284 280 278 235 ($ in millions) 163 3% 2,415 2,257 2,479 2,215 2,380 2,092 2,089 2,161 2,067 1,958 1,848 2% 1% 0% 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 YTD Payment Solutions Leasing Payment Solutions Leasing (1) Represents global leasing and Payment Solutions receivables
  • 25. How does declining mail volume affect the business? Is the business being hurt by electronic substitution for mail?
  • 26. Impact of declining mail volumes • Between 2000 and 2007 mail volumes have moved in the range of about +/- 2% per year. Mail volumes are up, on average, 0.3% per year over the same period. • No significant, immediate impact since what customers pay is not based on volume processed • Most of the decline in mail volume is in consumer-to-business mail which does not impact metered mail • Internet generates business through eBay • Continue to diversify our business to mitigate the impact of declining mail volumes • Mail volumes in other parts of the world are growing
  • 27. We continue to expand into underserved areas of the Mailstream $7,000 $6,130 $6,000 Other $4,464 $5,000 Pitney Bowes Revenue +73.8% Other $4,000 62% Pitney Bowes Revenue $3,000 49% $2,000 U.S. Mailing U.S. Mailing +2.3% Revenue Revenue $1,000 51% 38% $0 2003* 2007 * Excludes discontinued operations.
  • 28. How does the economy affect the business? What is the company’s exposure to the financial services sector and other business sectors?
  • 29. Pitney Bowes has performed consistently through different economic cycles 1,800 6,500 1,600 5,500 1,400 4,500 1,200 3,500 R evenues EBIT DA 1,000 2,500 800 1,500 600 500 400 (500) 87 89 91 93 95 97 99 01 03 05 07 19 19 19 19 19 19 19 20 20 20 20 EBITDA Revenues U.S. Recession * Includes acquisitions and divestitures.
  • 30. 2007 Pitney Bowes U.S. revenue by industry vertical 25% 23% 21% 20% 15% 13% 10% 10% 6% 5% 5% 5% 5% 4% 4% 3% 2% 0% Mail and Manu- Govern- Other Retail Telecoms Transpor- Education Real Financial Profess- Whole- Print facturing ment Services & Utilities tation Estate Services ional sale Providers Service Trade
  • 31. 2007 U.S. Mailing revenue by industry vertical 29% 30% 25% 20% 15% 15% 10% 8% 8% 8% 7% 7% 5% 5% 5% 3% 3% 2% 0% Govern- Other Real Telecoms & Profess- Retail Mail and Manu- Financial Whole- Education Transpor- ment facturing Services Estate Utilities ional Print Services sale tation Service Providers Trade
  • 32. With the dollar getting stronger, how will changes in currency impact the company’s results?
  • 33. Impact of a change in exchange rates One percent change in average foreign currency: • Revenue = 0.3% • EPS = $0.01