MINNEAPOLIS--(BUSINESS WIRE)--Deluxe (NYSE: DLX), a trusted Payments and Data company, today announced its collaboration with Visa to implement Visa Direct. This collaboration introduces dlxFastFunds, a funding solution that leverages Visa's trusted payment network to help businesses take control of their cash flow by skipping the typical one- to two-day settlement delay. "As more businesses embrace digital payments, the ability to send funds efficiently and with confidence becomes a competitive advantage,† ...

Financial Performance - Adjusted EBITDA increased by $17 million to $326 million for the first nine months of 2025, with an adjusted EBITDA margin of 20.4%, up from 19.3% in the same period of 2024[92]. - Total revenue for the first nine months of 2025 decreased by $3 million to $1.60 billion, impacted by a $10 million reduction due to business exits; excluding this, revenue would have increased[93]. - Free cash flow rose by $32 million to $96 million in the first nine months of 2025, driven by improved operational performance[94]. - Net income for Q3 2025 was $33,766,000, a 276.5% increase from Q3 2024, while diluted EPS rose to $0.74, up 270.0% year-over-year[118]. - Adjusted diluted EPS for Q3 2025 was $1.09, a 29.8% increase from Q3 2024, reflecting benefits from pricing and cost management actions[118]. - Adjusted EBITDA for Q3 2025 reached $118,887,000, compared to $104,902,000 in Q3 2024, marking a 13.3% increase[123]. - Adjusted EBITDA margin improved to 22.0% in Q3 2025 from 19.9% in Q3 2024, reflecting enhanced operational efficiency[123]. - Total revenue for Q3 2025 was $279,945,000, a decrease of 5.8% compared to Q3 2024, and for the first nine months of 2025, it was $852,296,000, down 6.3% year-over-year[137]. Cost Management - Selling, general and administrative (SG&A) expenses decreased by 6.8% in Q3 2025 compared to Q3 2024, contributing to improved profitability[88]. - SG&A expense decreased by 6.8% in Q3 2025 and 6.3% in the first nine months compared to the same periods in 2024, driven by cost management actions[109]. - The company expects to realize annual cost savings of approximately $6 million in cost of sales and $14 million in SG&A expenses in 2025 compared to 2024[129]. - Restructuring and integration expenses dropped by 73.6% in Q3 2025 and 59.3% in the first nine months compared to 2024, reflecting alignment with growth strategy[112]. Debt and Cash Management - The company reduced net debt by $45 million from the previous year end, reflecting a commitment to enhancing financial performance[90]. - Cash and cash equivalents stood at $26 million as of September 30, 2025, with an additional $393 million available for borrowing under the revolving credit facility[99]. - Total debt as of September 30, 2025, was $1,449,785,000, down from $1,503,151,000 at the end of 2024, while net debt decreased to $1,423,982,000[122]. - As of September 30, 2025, total debt obligations were $1.47 billion, down from $1.52 billion as of December 31, 2024[146]. - The principal amount of fixed interest rate debt was $925 million at an average interest rate of 8.1% as of September 30, 2025[146]. Strategic Investments - The acquisition of assets from JPMorgan Chase's CheckMatch service for $25 million is expected to strengthen the B2B Payments segment[91]. - The company anticipates capital expenditures between $90 million and $100 million for the full year 2025, compared to $94 million in 2024[99]. - The company is focused on growth investments, debt reduction, and returning capital to shareholders through dividends, which are subject to board approval[99]. - The North Star program aims for a $100 million run-rate improvement in free cash flow and an $80 million run-rate improvement in adjusted EBITDA by 2026[128]. - Restructuring and integration expenses incurred through September 30, 2025, totaled approximately $110 million, with an additional $5 million expected in Q4 2025[128]. Tax and Interest - Interest expense increased by 2.1% in Q3 2025 and 2.0% in the first nine months, primarily due to higher interest rates despite a reduction in average debt outstanding[115]. - The effective income tax rate decreased to 28.5% in Q3 2025 from 33.6% in Q3 2024, benefiting from lower tax impacts from foreign operations[117]. Asset Performance - The company recorded a 100% reduction in asset impairment charges in Q3 2025 compared to $6,700,000 in Q3 2024, indicating improved asset performance[113].

Core Insights - Deluxe (DLX) reported quarterly earnings of $1.09 per share, exceeding the Zacks Consensus Estimate of $0.92 per share, and showing an increase from $0.84 per share a year ago, resulting in an earnings surprise of +18.48% [1] - The company achieved revenues of $540.2 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 2.36% and up from $528.4 million year-over-year [2] - Deluxe has consistently surpassed consensus EPS estimates over the last four quarters, achieving this four times [2] Financial Performance - The earnings surprise for the previous quarter was +23.94%, with actual earnings of $0.88 per share compared to an expected $0.71 per share [1] - The current consensus EPS estimate for the upcoming quarter is $0.94, with projected revenues of $513.1 million, while the estimate for the current fiscal year is $3.49 on $2.11 billion in revenues [7] Market Position - Deluxe shares have underperformed the market, losing about 19.3% since the beginning of the year, while the S&P 500 has gained 15.1% [3] - The Zacks Industry Rank places the Business - Office Products sector in the top 14% of over 250 Zacks industries, indicating a favorable industry outlook [8] Future Outlook - The sustainability of Deluxe's stock price movement will depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The current Zacks Rank for Deluxe is 3 (Hold), suggesting that the shares are expected to perform in line with the market in the near future [6]

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Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was reported at $540.2 million, reflecting a 2.2% increase year-over-year and a 2.5% increase on a comparable adjusted basis [13] - GAAP net income improved to $33.7 million, or $0.74 per share, compared to $8.9 million, or $0.20 per share in Q3 2024 [14] - Comparable adjusted EBITDA reached $118.9 million, up 13.8% year-over-year, with margins improving to 22% of revenue, an increase of 220 basis points [14] - Adjusted EPS grew nearly 30% year-over-year to $1.09 per share [5][14] Business Line Data and Key Metrics Changes - The data segment saw revenue growth of 46% year-over-year, reaching $89.2 million, driven by strong demand for marketing campaigns [17] - Merchant services revenue grew by 4.8% year-over-year, totaling $98 million, with adjusted EBITDA improving by 14.6% to $20.4 million [15] - B2B payments segment revenues were $73.1 million, a decline of 2.7% year-over-year, but adjusted EBITDA expanded by 9.8% [16] - Print segment revenue declined by 5.9% year-over-year to $279.9 million, with branded promotional products seeing a 14.7% decline [20] Market Data and Key Metrics Changes - Payments and data now account for 47% of total company revenue, up nearly 400 basis points from the previous year [7] - The company reported a year-to-date free cash flow expansion of over 49%, growing by more than $31 million compared to the prior year [6] Company Strategy and Development Direction - The company is focused on shifting its revenue mix towards payments and data, driving operating efficiencies, and increasing EBITDA and cash flow to lower net debt [6][12] - The strategic priorities include enhancing the payments and data segments while leveraging cash flows from the print segment [6][12] - The company aims to achieve a debt-to-EBITDA target ratio below three times by the end of 2026 [5][23] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the sustainability of free cash flow improvements and the overall health of core fundamentals [29][27] - The company anticipates continued strong growth in the data segment, although some moderation is expected in Q4 due to seasonal factors [19][35] - Management remains committed to maintaining a balanced capital allocation strategy focused on debt reduction and internal investments for growth [40][41] Other Important Information - The company achieved a net debt reduction of over $20 million during the quarter, resulting in a leverage ratio of 3.3 times, ahead of schedule [6][23] - A quarterly dividend of $0.30 per share was approved, payable on December 1, 2025 [24] Q&A Session Summary Question: Discussion on free cash flow and its sustainability - Management highlighted the focus on improving free cash flow through enhanced profitability, lower restructuring spend, and strong working capital efficiency [29] Question: Insights on the distribution partners and pipeline - Management discussed the successful partnership with People's Bank and the healthy pipeline of opportunities in financial institutions and ISVs [31] Question: Key drivers behind the data segment's growth - Management attributed the data segment's growth to investments in infrastructure and proprietary AI tools that enhance marketing effectiveness [34] Question: Clarification on print segment margins - Management explained that improved margins in the print segment were driven by a focus on profitable volume and operational efficiencies [36][39] Question: Capital allocation strategy post-leverage target achievement - Management reiterated the commitment to debt reduction while also investing in high-return growth opportunities in payments and data [40][41]

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Third Quarter 2025 Earnings November 5, 2025 Today's Presenters Barry McCarthy President and Chief Executive Officer Chip Zint Senior Vice President and Chief Financial Officer Brian Anderson © 2025 Deluxe Corporation Brian Anderson Vice President, Strategy & Investor Relations 2 Vice President, Strategy & Investor Relations 3 Cautionary Statement Statements made in this presentation regarding Deluxe, the company's,or management's intentions, expectations, outlook, or predictions about future results or eve ...

Financial Performance - Reported revenue for Q3 2025 increased by 2.2% to $540.2 million, while comparable adjusted revenue rose by 2.5%[4] - Net income for Q3 2025 was $33.7 million, significantly up from $8.9 million in Q3 2024[4] - Comparable adjusted EBITDA increased by 13.8% to $118.9 million, with a margin of 22.0%, up 220 basis points year-over-year[4][9] - Adjusted diluted EPS improved by 29.8% to $1.09, compared to $0.84 in the same quarter last year[4][9] - Total revenue for Q3 2025 was $540.2 million, a slight increase of 2.4% compared to $528.4 million in Q3 2024[21] - Adjusted EBITDA for Q3 2025 reached $118.9 million, representing a 13.5% increase from $104.9 million in Q3 2024[25] - The adjusted EBITDA margin improved to 22.0% in Q3 2025, up from 19.9% in Q3 2024[29] - Comparable adjusted revenue for the nine months ended September 30, 2025, was $1,598.0 million, a slight increase from $1,590.9 million in the same period of 2024[29] Cash Flow and Debt - Free cash flow for the first nine months of 2025 increased by $31.6 million to $95.9 million[4] - Cash from operating activities for the first nine months of 2025 was $168.5 million, up from $134.1 million in 2024[19] - Free cash flow for Q3 2025 was $43.8 million, slightly down from $46.7 million in Q3 2024[35] - Total debt as of September 30, 2025, was $1,449.8 million, down from $1,503.1 million at the end of 2024[32] - Net debt as of September 30, 2025, was $1,424.0 million, down from $1,468.7 million at the end of 2024[17] - Net debt decreased to $1,424.0 million as of September 30, 2025, compared to $1,468.7 million at the end of 2024[32] Guidance and Dividends - The company raised its full-year 2025 guidance for adjusted diluted EPS, with revenue expected between $2.11 billion and $2.13 billion[9] - Adjusted EBITDA guidance for 2025 is set between $425 million and $435 million[9] - The Board of Directors approved a quarterly dividend of $0.30 per share, payable on December 1, 2025[7] Revenue Breakdown - Merchant Services revenue increased to $98.0 million, up 4.8% from $93.5 million year-over-year[21] - Data Solutions revenue surged to $89.2 million, a significant increase of 46.1% compared to $61.1 million in the same quarter last year[21]

Core Insights - Deluxe (NYSE: DLX) announced its third quarter 2025 financial results, which are available on the company's Investor Relations website [1] - The earnings release will be submitted to the Securities and Exchange Commission (SEC) on a Form 8-K [1] - An open-access conference call to discuss the financial results is scheduled for today at 5:00 p.m. ET [1]

Company Overview - Deluxe is a Trusted Payments and Data company that has been supporting businesses for over 100 years, helping them pay, get paid, and grow [2][3] - The company processes more than $2 trillion in annual payment volume, serving millions of small businesses and thousands of financial institutions [2] Financial Reporting - Deluxe will report its third quarter 2025 financial results on November 5, 2025, after market close [1] - An open-access conference call will be held on the same day at 5:00 p.m. ET, allowing interested parties to listen in [1] Recent Developments - Deluxe has expanded its partnership with Peoples Bank, a $9.5 billion financial institution, to deliver integrated Merchant Services [5] - Michelle T. Collins has been elected to Deluxe's Board of Directors, bringing over four decades of experience in business transformations and risk management [6] - Deluxe Merchant Services has won the 2025 Association of TeleServices International Call Center Award of Distinction for the 13th consecutive year, highlighting the exceptional performance of its customer care team [7]