CHAIRMAN’S LETTER  The spirit of innovation is central to all we do at Pitney Bowes. Our mail and document management solutions are changing the very nature of business communications. This is what we mean when we talk about pushing the envelope. And it is in this context that I want to talk about our accomplishments in 2004 and the excellent opportunities that I see for the future.  I am extremely pleased by the company’s  performance in 2004. Our diversified revenue base drove growth of  8 percent. Our organic revenue growth was  3 percent, excluding  the effect of strategic transactions and  currency translation. Both rates are the highest we have had  in five years. We also had an exceptionally strong finish to the  year. In fact, the fourth quarter was our best quarter in more than four years. As part of our growth strategies, we aggressively pursued acquisitions in 2004, completing 14 and strengthening our market position on a number  of fronts, including our software capabilities, our Mail Services  business and our global presence. We also continued to expand our broad range of offerings with exciting new products and services, including new digital meters that are helping to boost the performance of our mail finishing business. The letter from Bruce Nolop, our Chief Financial Officer, provides addi- tional perspective on our results on page 27 of this report. Here, I want  to concentrate on the factors that drove our  performance. Pitney Bowes is in the  enviable position of  having six diversified growth engines. They  all contributed to the  company’s success in 2004 and should continue to drive growth for years  to come. Here are  some highlights: SIX GROWTH ENGINES > Small Business Solutions delivered 8 percent revenue growth and double-digit earnings growth in 2004 and enlarged its market base to 840,000 customers, a net increase of 115,000 customers since 2002. Small businesses value the convenience and flexi- bility of our mailing and shipping solutions, including digital mailing systems specifically designed for small mailers and our new shipping solution for the small office and home office. > Mail Services revenue grew 20 percent at sites we have owned for more than a year and earnings grew even faster. The PSI Group has grown from 12  facilities in 2002 to a network of 30 sites processing 2 Michael J. Critelli Chairman and Chief Executive Officer