Bowing to pressure from investors, Pitney Bowes has replaced longtime CEO Marc Lautenbach, who is also leaving the board of directors, while a company statement on the news points to the likelihood of a pending sale of the money-losing global ecommerce unit, which investors have also called for. The board named EVP and Group President Jason Dies as interim CEO.
Some major Pitney Bowes investors unhappy with its financial results are renewing calls for the company to sell off its money-losing global ecommerce business and get rid of CEO Marc Lautenbach, with one estimating a $1 billion valuation for the unit and possible interest from heavyweights like Amazon and Walmart. Short of that, another bruising proxy fight could be in the cards for next year.
Postal consolidation and global logistics firm Pitney Bowes is expanding 1-3-day service to 20+ U.S. cities in the Southeast and Texas, Lousiana and New Mexico, in a push to makes its services more attractive to shippers in a down market and reverse its losses. The company will have fresh competition in Texas, where OnTrac added coverage to Dallas-Fort Worth, Austin, Houston, and San Antonio.
Pitney Bowes shareholders voted to add four new directors from a slate of five proposed by activist firm Hestia Capital Management to join the nine-member board, backing a group of investors looking for wholesale changes to reverse the fortunes of the postal consolidation and cross-border ecommerce firm. Both sides pledged to work together for the betterment of the company. The market boosted the stock.
Pitney Bowes reported a 10% drop in Q1 revenue and a net loss of $8 million vs. income of $21 million in 2022, and announced unspecified staff cuts in its global ecommerce and domestic parcel units, as it looks at a contentious shareholder meeting with major investors eager for wholesale changes. The opposition group has put forward turnaround specialist Lance Rosenzweig as an interim CEO candidate.
FedEx saw the biggest U.S. parcel volume falloff in 2022, Pitney Bowes reported, and while overall volume last year was down by 2.2%, the pandemic bump in ecommerce helped it outpace the 2019 projection, hitting the target a year early. The CAGR for parcel volume growth from 2023-2028 is projected to be halved, from 10.8% to 5%.
The pain from pullbacks in retail and ecommerce spending is being felt across the board in logistics, delivery and shipping operations, both internal and external, with layoffs announced at a number of companies resizing in line with lowered demand. From Walmart to 3PLs, trucking, supply chain and robotics, reports continue to pour in.
Pitney Bowes came out swinging at investor Hestia Capital, which has started a proxy fight aimed at reshuffling its board and management, accusing the firm of having a vague strategy for the parcel shipping and cross-border firm, and lacking understanding of how to run a logistics business. The annual meeting will be held in May.
Pitney Bowes announced a refresh of its board in a proxy statement, but it was not enough to satisfy a large stakeholder that has put forward its own slate of five outside board candidates ahead of the company’s annual meeting in May, saying wholesale changes are needed to boost performance.
Activist investor Hestia Capital has proposed a majority slate of seven directors to replace current board members at Pitney Bowes, citing poor performance and what it termed strategic missteps over the past decade, with the company responding that Hestia is not interested in a good faith discussion.