0000027996false00000279962024-02-012024-02-01


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 1, 2024


DELUXE CORPORATION
(Exact name of registrant as specified in its charter)

MN1-794541-0216800
(State or other jurisdiction(Commission(I.R.S. Employer
of incorporation)File Number)Identification No.)

801 S. Marquette Ave., Minneapolis, MN
55402-2807
(Address of principal executive offices)(Zip Code)

(651) 483-7111
Registrant's telephone number, including area code



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
Common stock, par value $1.00 per shareDLXNYSE

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
☐ Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Section 2 - Financial Information

Item 2.02 Results of Operations and Financial Condition.

Furnished as Exhibit 99.1 is a press release of Deluxe Corporation reporting results from fourth quarter 2023.

The information in this Item 2.02 and Exhibit 99.1 shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference into any filings under the Securities Act of 1933, as amended.


Section 9 - Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.
Exhibit
Number		Description
99.1
101.INSXBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCHXBRL Taxonomy Extension Schema Document
101.LABXBRL Taxonomy Extension Label Linkbase Document
101.PREXBRL Taxonomy Extension Presentation Linkbase Document
104Cover page interactive data file (formatted as Inline XBRL and contained in Exhibit 101)


2


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: February 1, 2024

DELUXE CORPORATION
/s/ Jeffrey L. Cotter
Jeffrey L. Cotter
Senior Vice President, Chief
Administrative Officer and
General Counsel

3
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deluxelogo2020ba01a.jpg
Exhibit 99.1
Contact:
Brian Anderson, VP, Strategy & Investor RelationsKeith Negrin, VP, Communications
651-447-4197612-669-1459
brian.anderson@deluxe.comkeith.negrin@deluxe.com


DELUXE REPORTS FOURTH QUARTER AND FULL YEAR 2023 RESULTS;
AFFIRMS FULL YEAR 2024 OUTLOOK

•2023 reported revenue decreased 2.0% including impact from divestitures, while comparable adjusted revenue increased $6 million or 0.3%.
•Third consecutive year of revenue growth, on a comparable adjusted basis.
•Full year GAAP diluted EPS was $0.59 while adjusted diluted EPS was $3.32.
•Full year net income was $26.2 million, down from $65.5 million in 2022, on increased interest expense and restructuring activity.
•Comparable adjusted EBITDA increased 3.2% to $417.1 million for the full year.
•2024 guidance reiterated, reflecting continued expansion of comparable adjusted revenue, EBITDA, and EPS.

Minneapolis – February 1, 2024 – Deluxe (NYSE: DLX), a Trusted Payments and Data company, today reported operating results for its fourth quarter and year ended December 31, 2023.

“We are pleased to report a third consecutive year of organic revenue growth, while also increasing comparable adjusted EBITDA faster than revenue, and generating significantly improved free cash flows during both the fourth quarter and full year periods. These results further demonstrate the power of the combined Deluxe portfolio of offerings, aligned with the transformation of our business to a modern Payments and Data company,” said Barry McCarthy, President and CEO of Deluxe. “The increasing scale of our combined Payments and Data platform is driving improved operating leverage and expansion of our comparable adjusted EBITDA margins, which we expect will continue in line with our 2024 guidance as we focus on execution aligned to our North Star initiatives.”

“We were particularly pleased with our ability to improve our net debt position and leverage ratio during 2023, and the enterprise has strong momentum aligned with our core capital allocation priorities as 2024 begins,” said Chip Zint, Senior Vice President and Chief Financial Officer of Deluxe. “Deluxe remains diligently focused on operational execution, and we are confident in the continued expansion of our earnings trajectory.”


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Full Year 2023 Financial Highlights
(in millions, except per share amounts)
Full Year
2023
Full Year
2022
% Change
Revenue$2,192.3  $2,238.0  (2.0 %)
Comparable Adjusted Revenue$2,192.3  $2,186.3  0.3 %
Net Income$26.2 $65.5  (60.0 %)
Adjusted EBITDA$417.1  $418.1  (0.2 %)
Comparable Adjusted EBITDA$417.1  $404.0  3.2 %
Diluted EPS$0.59 $1.50(60.7 %)
Adjusted Diluted EPS$3.32 $4.08(18.6 %)

•Revenue for the full year decreased 2.0% from the previous year. Comparable adjusted revenue, reflecting the removal of business exits, increased 0.3% compared to the previous year.
•Net income of $26.2 million was down from $65.5 million in 2022, primarily reflecting higher interest expense and restructuring activities, in addition to the impact of divestitures.
•Adjusted EBITDA margin was 19.0%, up 30 basis points from the prior year, while comparable adjusted EBITDA margin was up 50 basis points.
•Adjusted diluted EPS was $3.32 versus $4.08 in the prior year.

Fourth Quarter 2023 Financial Highlights
(in millions, except per share amounts)
4th Quarter
2023
4th Quarter
2022
% Change
Revenue$537.4  $564.0  (4.7 %)
Comparable Adjusted Revenue$537.4  $548.3  (2.0 %)
Net Income$15.0 $19.0  (21.1 %)
Adjusted EBITDA$106.4  $112.2  (5.2 %)
Comparable Adjusted EBITDA$106.4  $105.7  0.7 %
Diluted EPS$0.34 $0.44(22.7 %)
Adjusted Diluted EPS$0.80 $1.04(23.1 %)

•Revenue for the fourth quarter decreased 4.7% from the previous year. Comparable adjusted revenue, reflecting the removal of business exits, decreased 2.0% compared to the previous year.
•Net income of $15.0 million was down from $19.0 million in the fourth quarter of 2022, primarily reflecting business exits and higher interest expense.
•Adjusted EBITDA margin was 19.8%, down 10 basis points from the prior year, while comparable adjusted EBITDA margin was up 50 basis points.
•Adjusted diluted EPS was $0.80 versus $1.04 in the prior year.



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Outlook

The Company expects the following for full-year 2024, inclusive of expected business exits, and all figures are approximate:

•Revenue of $2.14 to $2.18 billion
•Adjusted EBITDA of $400 to $420 million
•Adjusted EPS of $3.10 to $3.40
•Free cash flow of $60 to $80 million

The guidance outlined above is subject to, among other things, prevailing macroeconomic conditions, global unrest, labor supply issues, inflation, and the impact of business exits.

Capital Allocation and Dividend

The Board of Directors recently approved a regular quarterly dividend of $0.30 per share. The dividend will be payable on March 4, 2024, to shareholders of record as of market closing on February 20, 2024.

Earnings Call Information

Deluxe management will host a conference call today at 8:30 a.m. ET (7:30 a.m. CT) to review the financial results. Listeners can access the call by dialing by dialing 1-888-210-4748 (access code 7092711). The audio and accompanying slides will be available via a simultaneous webcast on the investor relations website at www.investors.deluxe.com. Alternatively, an audio replay will be available after 11:30 a.m. ET through midnight on February 8, 2024, by dialing 1-800-770-2030 (access code 7092711).

About Deluxe Corporation

Deluxe, a Trusted Payments and Data company, champions business so communities thrive. Our solutions help businesses pay and get paid, accelerate growth and operate more efficiently. For more than 100 years, Deluxe customers have relied on our solutions and platforms at all stages of their lifecycle, from start-up to maturity. Our powerful scale supports millions of small businesses, thousands of vital financial institutions and hundreds of the world’s largest consumer brands. Our reach, scale and distribution channels position Deluxe to be our customers’ most trusted business partner. To learn how we can help your business, visit us at www.deluxe.com, www.facebook.com/deluxecorp, www.linkedin.com/company/deluxe, or www.twitter.com/deluxe.

Forward-Looking Statements

Statements made in this release concerning Deluxe, the company’s or management’s intentions, expectations, outlook or predictions about future results or events are “forward-looking statements” within

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the meaning of the Private Securities Litigation Reform Act of 1995. Such statements reflect management’s current intentions or beliefs and are subject to risks and uncertainties that could cause actual results or events to vary from stated expectations, which variations could be material and adverse. Factors that could produce such a variation include, but are not limited to, the following: potential continuing negative impacts from pandemic health issues, such as the coronavirus / COVID-19, along with the impact of related government restrictions or similar directives on our future results of operations and our future financial condition; changes in local, regional, national and international economic or political conditions, including those resulting from heightened inflation, rising interest rates, a recession, or intensified international hostilities, and the impact they may have on the company, its customers or demand for the company’s products and services; the effect of proposed and enacted legislative and regulatory actions affecting the company or the financial services industry as a whole; continuing cost increases and/or declines in the availability of materials and other services; the company’s ability to execute its transformational strategy and to realize the intended benefits; the inherent unreliability of earnings, revenue and cash flow predictions due to numerous factors, many of which are beyond the company’s control; declining demand for the company’s checks, check-related products and services and business forms; risks that the company’s strategies intended to drive sustained revenue and earnings growth, despite the continuing decline in checks and forms, are delayed or unsuccessful; intense competition; continued consolidation of financial institutions and/or bank failures, thereby reducing the number of potential customers and referral sources and increasing downward pressure on the company’s revenue and gross profit; risks related to acquisitions, including integration-related risks and risks that future acquisitions will not be consummated; risks that any such acquisitions do not produce the anticipated results or synergies; risks that the company’s cost reduction initiatives will be delayed or unsuccessful; risks related to any divestitures contemplated or undertaken by the company; performance shortfalls by one or more of the company’s major suppliers, licensors or service providers; continuing supply chain and labor supply issues; unanticipated delays, costs and expenses in the development and marketing of products and services, including web services and financial technology and treasury management solutions; the failure of such products and services to deliver the expected revenues and other financial targets; risks related to security breaches, computer malware or other cyber-attacks; risks of interruptions to the company’s website operations or information technology systems; and risks of unfavorable outcomes and the costs to defend litigation and other disputes. The company’s forward-looking statements speak only as of the time made, and management assumes no obligation to publicly update any such statements. Additional information concerning these and other factors that could cause actual results and events to differ materially from the company’s current expectations are contained in the company’s Form 10-K for the year ended December 31, 2022, and other filings made with the SEC. The company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events, new information or future circumstances.


DELUXE CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(in millions, except per share amounts)
(Unaudited)

Quarter Ended
December 31,		Year Ended
December 31,
2023202220232022
Product revenue$318.8 $329.5 $1,257.6 $1,286.2 
Service revenue218.6 234.5 934.7 951.8 
Total revenue537.4 564.0 2,192.3 2,238.0 
Cost of products
(124.2)(124.8)(486.1)(470.2)
Cost of services
(129.7)(137.8)(543.5)(561.9)
Total cost of revenue
(253.9)(262.6)(1,029.6)(1,032.1)
Gross profit283.5 301.4 1,162.7 1,205.9 
Selling, general and administrative expense
(229.1)(240.1)(956.1)(993.3)
Restructuring and integration expense(18.2)(15.9)(78.2)(62.5)
Gain on sale of businesses and long-lived assets14.8 — 32.4 19.3 
Operating income51.0 45.4 160.8 169.4 
Interest expense(31.7)(29.0)(125.6)(94.4)
Other income0.1 1.9 4.6 9.4 
Income before income taxes19.4 18.3 39.8 84.4 
Income tax (provision) benefit(4.4)0.7 (13.6)(18.9)
Net income15.0 19.0 26.2 65.5 
Non-controlling interest— — (0.1)(0.1)
Net income attributable to Deluxe$15.0 $19.0 $26.1 $65.4 
Weighted average dilutive shares44.1 43.4 43.8 43.3 
Diluted earnings per share$0.34 $0.44 $0.59 $1.50 
Adjusted diluted earnings per share0.80 1.04 3.32 4.08 
Capital expenditures19.9 31.1 100.7 104.6 
Depreciation and amortization expense44.7 43.6 169.7 172.6 
EBITDA95.8 90.9 335.0 351.3 
Adjusted EBITDA106.4 112.2 417.1 418.1 




DELUXE CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(dollars and shares in millions)
(Unaudited)

                            
December 31,
2023		December 31,
2022
Cash and cash equivalents$72.0 $40.4 
Other current assets689.0 663.6 
Property, plant & equipment116.5 124.9 
Operating lease assets59.0 47.1 
Intangibles391.7 459.0 
Goodwill1,430.6 1,431.4 
Other non-current assets321.8 310.1 
  Total assets$3,080.6 $3,076.5 
Current portion of long-term debt$86.2 $71.7 
Other current liabilities732.9 680.6 
Long-term debt1,506.7 1,572.5 
Non-current operating lease liabilities58.8 49.0 
Other non-current liabilities91.4 98.5 
Shareholders' equity604.6 604.2 
Total liabilities and shareholders' equity$3,080.6 $3,076.5 
Net debt$1,520.9 $1,603.8 
Shares outstanding43.7 43.2 




DELUXE CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(in millions)
(Unaudited)
Year Ended
December 31,
20232022
Cash provided (used) by:
  Operating activities:
Net income$26.2 $65.5 
Depreciation and amortization of intangibles169.7 172.6 
Gain on sale of businesses and long-lived assets(32.4)(19.3)
Prepaid product discount payments(28.5)(30.6)
Other63.4 3.3 
Total operating activities198.4 191.5 
  Investing activities:
Proceeds from sale of businesses and long-lived assets53.6 25.2 
Purchases of capital assets(100.7)(104.6)
Other3.8 (0.9)
Total investing activities(43.3)(80.3)
  Financing activities:
Net change in debt(55.2)(40.6)
Dividends(53.3)(52.6)
Net change in customer funds obligations79.1 56.4 
Other(8.3)(11.8)
Total financing activities(37.7)(48.6)
  Effect of exchange rate change on cash, cash equivalents, restricted cash and restricted cash equivalents
3.2 (10.7)
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents
120.6 51.9 
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year
337.4 285.5 
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of year$458.0 $337.4 
Free cash flow
$97.7 $86.9 




DELUXE CORPORATION
SEGMENT INFORMATION
(In millions)
(Unaudited)
Quarter Ended
December 31,		Year Ended
December 31,
2023202220232022
Revenue:
Payments$174.9 $171.4 $690.7 $678.6 
Data Solutions44.1 62.7 238.8 267.5 
Promotional Solutions142.4 154.3 541.7 562.9 
Checks176.0 175.6 721.1 729.0 
Total$537.4 $564.0 $2,192.3 $2,238.0 
Adjusted EBITDA:
Payments$42.3 $37.0 $152.8 $144.6 
Data Solutions7.3 17.3 55.7 68.2 
Promotional Solutions24.1 29.8 80.8 79.5 
Checks78.9 74.7 320.3 320.5 
Corporate(46.2)(46.6)(192.5)(194.7)
Total$106.4 $112.2 $417.1 $418.1 
Adjusted EBITDA Margin:
Payments24.2 %21.6 %22.1 %21.3 %
Data Solutions16.6 %27.6 %23.3 %25.5 %
Promotional Solutions16.9 %19.3 %14.9 %14.1 %
Checks44.8 %42.5 %44.4 %44.0 %
Total19.8 %19.9 %19.0 %18.7 %

The segment information reported here was calculated utilizing the methodology outlined in the Notes to Consolidated Financial Statements included in the company's Annual Report on Form 10-K for the year ended December 31, 2022.


DELUXE CORPORATION
SEGMENT INFORMATION (continued)
(In millions)
(Unaudited)
Quarter Ended
December 31,		Year Ended
December 31,
2023202220232022
Comparable Adjusted Revenue:
Payments$174.9 $171.4 $690.7 $678.6 
Data Solutions44.1 47.7 238.8 229.0 
Promotional Solutions142.4 153.6 541.7 549.7 
Checks176.0 175.6 721.1 729.0 
Total$537.4 $548.3 $2,192.3 $2,186.3 
Comparable Adjusted EBITDA:
Payments$42.3 $37.0 $152.8 $144.6 
Data Solutions7.3 10.9 55.7 54.8 
Promotional Solutions24.1 29.7 80.8 78.8 
Checks78.9 74.7 320.3 320.5 
Corporate(46.2)(46.6)(192.5)(194.7)
Total$106.4 $105.7 $417.1 $404.0 
Comparable Adjusted EBITDA Margin:
Payments24.2 %21.6 %22.1 %21.3 %
Data Solutions16.6 %22.9 %23.3 %23.9 %
Promotional Solutions16.9 %19.3 %14.9 %14.3 %
Checks44.8 %42.5 %44.4 %44.0 %
Total19.8 %19.3 %19.0 %18.5 %



DELUXE CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(in millions)
(Unaudited)

Note that the company has not reconciled the adjusted EBITDA, adjusted EPS or free cash flow outlook for 2024 to the directly comparable GAAP financial measures because the company does not provide outlook guidance for the reconciling items between net income, adjusted net income and adjusted EBITDA, and certain of these reconciling items impact cash flows from operating activities. Because of the substantial uncertainty and variability surrounding certain of these forward-looking reconciling items, including: asset impairment charges, restructuring and integration costs, gains and losses on sales of businesses and long-lived assets, and certain legal-related expenses, a reconciliation of the non-GAAP financial measure outlook to the corresponding GAAP measures is not available without unreasonable effort. The probable significance of certain of these reconciling items is high and, based on historical experience, could be material.


EBITDA, ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN

Management discloses EBITDA, adjusted EBITDA and adjusted EBITDA margin because it believes they are useful in evaluating the company's operating performance, as the calculations eliminate the effect of interest expense, income taxes, the accounting effects of capital investments (i.e., depreciation and amortization) and in the case of adjusted EBITDA and adjusted EBITDA margin, certain items, as presented below, that may not be indicative of current period operating performance. In addition, management utilizes these measures to assess the operating results and performance of the business, to perform analytical comparisons and to identify strategies to improve performance. Management also believes that an increasing EBITDA and adjusted EBITDA depict an increase in the value of the company. Management does not consider EBITDA and adjusted EBITDA to be measures of cash flow, as they do not consider certain cash requirements, such as interest, income taxes, debt service payments or capital investments. Management does not consider EBITDA, adjusted EBITDA or adjusted EBITDA margin to be substitutes for operating income or net income. Instead, management believes that these amounts are useful performance measures that should be considered in addition to GAAP performance measures.

Quarter Ended
December 31,		Year Ended
December 31,
2023202220232022
Net income$15.0 $19.0 $26.2 $65.5 
Non-controlling interest— — (0.1)(0.1)
Interest expense31.7 29.0 125.6 94.4 
Income tax provision (benefit)4.4 (0.7)13.6 18.9 
Depreciation and amortization expense44.7 43.6 169.7 172.6 
EBITDA95.8 90.9 335.0 351.3 
Restructuring and integration costs19.5 16.3 90.5 63.1 
Share-based compensation expense4.6 4.9 20.5 23.6 
Acquisition transaction costs— — — 0.1 
Certain legal-related expense (benefit)— 0.1 2.2 (0.7)
Gain on sale of businesses and long-lived assets(14.8)— (32.4)(19.3)
Loss on sale of Payroll investment1.3 — 1.3 — 
Adjusted EBITDA$106.4 $112.2 $417.1 $418.1 
Adjusted EBITDA as a percentage of total revenue (adjusted EBITDA margin)19.8 %19.9 %19.0 %18.7 %



DELUXE CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (continued)
(in millions, except per share amounts)
(Unaudited)

ADJUSTED DILUTED EPS

By excluding the impact of non-cash items or items that may not be indicative of current period operating performance, management believes that adjusted diluted EPS provides useful comparable information to assist in analyzing the company's current and future operating performance. As such, adjusted diluted EPS is one of the key financial performance metrics used to assess the operating results and performance of the business and to identify strategies to improve performance. It is reasonable to expect that one or more of the excluded items will occur in future periods, but the amounts recognized may vary significantly. Management does not consider adjusted diluted EPS to be a substitute for GAAP performance measures, but believes that it is a useful performance measure that should be considered in addition to GAAP performance measures.

Quarter Ended
December 31,		Year Ended
December 31,
2023202220232022
Net income$15.0 $19.0 $26.2 $65.5 
Non-controlling interest— — (0.1)(0.1)
Net income attributable to Deluxe15.0 19.0 26.1 65.4 
Acquisition amortization16.0 21.9 74.8 90.6 
Accelerated amortization2.5 — 2.5 — 
Restructuring and integration costs19.5 16.3 90.5 63.1 
Share-based compensation expense4.6 4.9 20.5 23.6 
Acquisition transaction costs— — — 0.1 
Certain legal-related expense (benefit)— 0.1 2.2 (0.7)
Gain on sale of businesses and long-lived assets(14.8)— (32.4)(19.3)
Loss on sale of Payroll investment1.3 — 1.3 — 
Gain on debt retirements— — — (1.7)
Adjustments, pre-tax29.1 43.2 159.4 155.7 
Income tax provision impact of pretax adjustments(1)
(8.9)(17.0)(39.6)(43.8)
Adjustments, net of tax20.2 26.2 119.8 111.9 
Adjusted net income attributable to Deluxe35.2 45.2 145.9 177.3 
Income allocated to participating securities— — — (0.1)
Re-measurement of share-based awards classified as liabilities— — — (0.5)
Adjusted income attributable to Deluxe available to common shareholders$35.2 $45.2 $145.9 $176.7 
Weighted-average dilutive shares(2)
44.1 43.4 43.9 43.3 
GAAP Diluted EPS$0.34 $0.44 $0.59 $1.50 
Adjustments, net of tax0.46 0.60 2.73 2.58 
Adjusted Diluted EPS$0.80 $1.04 $3.32 $4.08 

(1) The tax effect of the pretax adjustments considers the tax treatment and related tax rate(s) that apply to each adjustment in the applicable tax jurisdiction(s). Generally, this results in a tax impact that approximates the U.S. effective tax rate for each adjustment. However, the tax impact of certain adjustments, such as share-based compensation expense, depends on whether the amounts are deductible in the respective tax jurisdictions and the applicable effective tax rate(s) in those jurisdictions.

(2) The weighted-average dilutive shares used in the calculation of adjusted EPS for the quarter ended December 31, 2022 differs from the GAAP calculation due to differences in the amount of dilutive securities in each calculation.


DELUXE CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (continued)
(in millions)
(Unaudited)

COMPARABLE ADJUSTED REVENUE, COMPARABLE ADJUSTED EBITDA AND COMPARABLE ADJUSTED EBITDA MARGIN

Management views the measures of comparable adjusted revenue and comparable adjusted EBITDA, which exclude the impact of business exits, as important indicators when assessing and evaluating the performance of the business and when identifying strategies to improve performance. By excluding the impact of business exits, management is able to evaluate internally-generated revenue and adjusted EBITDA, measured by comparable results on a year-over-year basis. These measures are utilized by management to compare operational performance across fiscal periods when an acquisition or business exit occurs.

COMPARABLE ADJUSTED REVENUE

Quarter Ended
December 31,		Year Ended
December 31,
2023202220232022
Total Company:
Total revenue$537.4 $564.0 $2,192.3 $2,238.0 
Business exits— (15.7)— (51.7)
Comparable adjusted revenue$537.4 $548.3 $2,192.3 $2,186.3 
Payments:
Total revenue$174.9 $171.4 $690.7 $678.6 
Data Solutions:
Total revenue$44.1 $62.7 $238.8 $267.5 
Business exits— (15.0)— (38.5)
Comparable adjusted revenue$44.1 $47.7 $238.8 $229.0 
Promotional Solutions:
Total revenue$142.4 $154.3 $541.7 $562.9 
Business exits— (0.7)— (13.2)
Comparable adjusted revenue$142.4 $153.6 $541.7 $549.7 
Checks:
Total revenue$176.0 $175.6 $721.1 $729.0 









DELUXE CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (continued)
(in millions)
(Unaudited)

COMPARABLE ADJUSTED EBITDA AND COMPARABLE ADJUSTED EBITDA MARGIN

Quarter Ended
December 31,		Year Ended
December 31,
2023202220232022
Total Company:
Adjusted EBITDA$106.4 $112.2 $417.1 $418.1 
Business exits— (6.5)— (14.1)
Comparable adjusted EBITDA$106.4 $105.7 $417.1 $404.0 
Comparable adjusted EBITDA margin19.8 %19.3 %19.0 %18.5 %
Payments:
Adjusted EBITDA$42.3 $37.0 $152.8 $144.6 
Data Solutions:
Adjusted EBITDA$7.3 $17.3 $55.7 $68.2 
Business exits— (6.4)— (13.4)
Comparable adjusted EBITDA$7.3 $10.9 $55.7 $54.8 
Comparable adjusted EBITDA margin16.6 %22.9 %23.3 %23.9 %
Promotional Solutions:
Adjusted EBITDA$24.1 $29.8 $80.8 $79.5 
Business exits— (0.1)— (0.7)
Comparable adjusted EBITDA$24.1 $29.7 $80.8 $78.8 
Comparable adjusted EBITDA margin16.9 %19.3 %14.9 %14.3 %
Checks:
Adjusted EBITDA$78.9 $74.7 $320.3 $320.5 
Corporate:
Adjusted EBITDA($46.2)($46.6)($192.5)($194.7)


DELUXE CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (continued)
(in millions)
(Unaudited)

NET DEBT

Management believes that net debt is an important measure to monitor leverage and to evaluate the balance sheet. In calculating net debt, cash and cash equivalents are subtracted from total debt because they could be used to reduce the company’s debt obligations. A limitation associated with using net debt is that it subtracts cash and cash equivalents, and therefore, may imply that management intends to use cash and cash equivalents to reduce outstanding debt. In addition, net debt suggests that our debt obligations are less than the most comparable GAAP measure indicates.

December 31,
2023		December 31,
2022
Total debt$1,592.9 $1,644.2 
Cash and cash equivalents(72.0)(40.4)
Net debt$1,520.9 $1,603.8 


FREE CASH FLOW

Management defines free cash flow as net cash provided by operating activities less purchases of capital assets. Management believes that free cash flow is an important indicator of cash available for debt service and for shareholders, after making capital investments to maintain or expand the company’s asset base. A limitation of using the free cash flow measure is that not all of the company’s free cash flow is available for discretionary spending, as the company may have mandatory debt payments and other cash requirements that must be deducted from its cash available for future use. Free cash flow is not a substitute for GAAP liquidity measures. Instead, management believes that this measurement provides an additional metric to compare cash generated by operations on a consistent basis and to provide insight into the cash flow available to fund items such as dividends, mandatory and discretionary debt reduction, acquisitions or other strategic investments, and share repurchases.

Quarter Ended
December 31,		Year Ended
December 31,
2023202220232022
Net cash provided by operating activities$83.4 $68.1 $198.4 $191.5 
Purchases of capital assets(19.9)(31.1)(100.7)(104.6)
Free cash flow$63.5 $37.0 $97.7 $86.9 

###

v3.24.0.1
Document and Entity Information Document
Feb. 01, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Feb. 01, 2024
Entity Registrant Name DELUXE CORPORATION
Entity Incorporation, State or Country Code MN
Entity File Number 1-7945
Entity Tax Identification Number 41-0216800
Entity Address, Address Line One 801 S. Marquette Ave.
Entity Address, City or Town Minneapolis
Entity Address, State or Province MN
Entity Address, Postal Zip Code 55402-2807
City Area Code 651
Local Phone Number 483-7111
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common stock, par value $1.00 per share
Trading Symbol DLX
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0000027996
Amendment Flag false
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