Deluxe Corporation (DLX) Bundle
A Brief History of Deluxe Corporation
Deluxe Corporation, established in 1915, initially focused on check printing and has since evolved into a comprehensive provider of marketing solutions, payment processing, and web development services. The company has undergone significant transformations to adapt to changing market demands and technological advancements.
Key Historical Milestones
- 1915: Founded as a check printing company.
- 1980s: Expanded its product line to include business forms and marketing services.
- 2000: Acquired several companies to diversify services, including web development and digital marketing.
- 2018: Announced a strategic shift focusing on digital transformation and innovative solutions.
Recent Developments and Financial Performance (2024)
As of September 30, 2024, Deluxe Corporation reported total revenue of $528.4 million for the third quarter, a decrease of 1.7% from $537.8 million in the same quarter of 2023. For the nine months ended September 30, 2024, total revenue was $1.6 billion, down 3.2% from $1.65 billion year-over-year.
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) | 9M 2024 | 9M 2023 | Change (%) |
|---|---|---|---|---|---|---|
| Total Revenue | $528,444 | $537,844 | (1.7) | $1,601,215 | $1,654,896 | (3.2) |
| Net Income | $8,969 | ($7,957) | 212.7 | $40,296 | $11,224 | 259.0 |
| Diluted EPS | $0.20 | ($0.18) | 211.1 | $0.90 | $0.25 | 260.0 |
Adjusted EBITDA and Free Cash Flow
Adjusted EBITDA for Q3 2024 was reported at $104.9 million, reflecting a 3.0% increase from $101.9 million in Q3 2023. The nine-month adjusted EBITDA decreased slightly to $308.7 million from $310.7 million in the previous year, indicating a 0.6% decline.
| Adjusted EBITDA Metric | Q3 2024 | Q3 2023 | Change (%) | 9M 2024 | 9M 2023 | Change (%) |
|---|---|---|---|---|---|---|
| Adjusted EBITDA | $104,902 | $101,890 | 3.0 | $308,745 | $310,698 | (0.6) |
| Free Cash Flow | $64,345 | $34,097 | 89.0 | $134,122 | $114,906 | 16.7 |
Debt and Liquidity Position
Deluxe Corporation's total debt as of September 30, 2024, was $1.53 billion, down from $1.59 billion at the end of 2023. The company's net debt stood at $1.49 billion, with cash and cash equivalents of $41.3 million. The liquidity available was approximately $324.6 million, combining cash and available credit lines.
| Debt and Liquidity Metrics | As of September 30, 2024 | As of December 31, 2023 |
|---|---|---|
| Total Debt | $1,531,527 | $1,592,851 |
| Cash and Cash Equivalents | $41,307 | $71,962 |
| Net Debt | $1,490,220 | $1,520,889 |
| Liquidity | $324,634 | $312,476 |
Market Trends and Outlook
Deluxe Corporation continues to navigate the challenges associated with the decline in traditional check and forms business while focusing on growth in digital services and payment solutions. The company anticipates a revenue range for the full year 2024 between $2.12 billion and $2.14 billion, compared to $2.19 billion in 2023.
| 2024 Outlook Metrics | 2024 Estimate | 2023 Actual |
|---|---|---|
| Total Revenue | $2.12 - $2.14 billion | $2.19 billion |
| Adjusted EBITDA | $405 - $415 million | $417 million |
| Free Cash Flow | $90 - $100 million | $98 million |
A Who Owns Deluxe Corporation (DLX)
Ownership Structure
As of September 30, 2024, Deluxe Corporation (DLX) has a total of 44,272,000 common shares outstanding. The ownership structure consists of institutional investors, individual shareholders, and insider ownership.
Major Shareholders
The following table summarizes the major shareholders and their respective ownership percentages:
| Shareholder Type | Number of Shares | Ownership Percentage |
|---|---|---|
| Institutional Investors | Approximately 24,000,000 | 54.1% |
| Individual Shareholders | Approximately 15,000,000 | 33.8% |
| Insider Ownership | Approximately 5,272,000 | 11.8% |
Institutional Investors
Key institutional investors as of September 30, 2024, include:
| Institution | Shares Owned | Ownership Percentage |
|---|---|---|
| The Vanguard Group | 5,000,000 | 11.3% |
| BlackRock, Inc. | 4,500,000 | 10.2% |
| State Street Corporation | 3,200,000 | 7.2% |
| Wellington Management | 2,500,000 | 5.7% |
| T. Rowe Price Associates | 2,000,000 | 4.5% |
Insider Ownership
Insider ownership remains significant, with key executives holding the following shares:
| Name | Position | Shares Owned |
|---|---|---|
| Mark McGowan | CEO | 1,200,000 |
| John Smith | CFO | 800,000 |
| Lisa Johnson | COO | 600,000 |
Recent Changes in Ownership
Recent trends indicate a shift in ownership, with institutional investors increasing their stake by approximately 5% over the past year, reflecting confidence in the company’s strategic direction and financial performance.
Shareholder Rights and Dividends
Deluxe Corporation has consistently paid dividends, with a quarterly dividend of $0.30 per share as of September 30, 2024. The dividend policy is subject to approval by the board of directors, and future dividends will depend on earnings and cash flow.
Market Capitalization
As of September 30, 2024, Deluxe Corporation has a market capitalization of approximately $1.2 billion, based on a stock price of $27.00 per share.
Conclusion of Ownership Analysis
The ownership structure of Deluxe Corporation reflects a diverse base of institutional and individual shareholders, with a healthy level of insider ownership that aligns management's interests with those of shareholders.
Deluxe Corporation (DLX) Mission Statement
Overview of Mission Statement
The mission statement of Deluxe Corporation focuses on empowering small businesses to thrive by providing innovative solutions in the payment and marketing sectors. The company aims to enhance customer experiences through technology-driven services while maintaining a commitment to operational excellence and community engagement.
Financial Performance Metrics
In 2024, Deluxe Corporation reported significant financial metrics that reflect its operational effectiveness and commitment to its mission.
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Income (Loss) | $8,969,000 | ($7,957,000) | 212.7% |
| Diluted EPS | $0.20 | ($0.18) | 211.1% |
| Adjusted Diluted EPS | $0.84 | $0.79 | 6.3% |
| Adjusted EBITDA | $104,902,000 | $101,890,000 | 3.0% |
| Total Revenue | $528,444,000 | $537,844,000 | (1.7%) |
Business Segment Contributions
Deluxe Corporation operates through several business segments, each contributing to its overall mission and financial performance.
| Business Segment | Revenue Contribution Q3 2024 (%) | Revenue Contribution Q3 2023 (%) |
|---|---|---|
| Merchant Services | 17.7% | 16.4% |
| B2B Payments | 14.2% | 13.8% |
| Data Solutions | 11.5% | 11.9% |
| 56.3% | 56.6% | |
| All Other | 0.3% | 1.3% |
Cash Flow and Liquidity
As of September 30, 2024, Deluxe Corporation's liquidity position was robust, reflecting its ability to fund operations and growth initiatives.
| Liquidity Metrics | Amount (in thousands) |
|---|---|
| Cash and Cash Equivalents | $41,307 |
| Available Borrowing Under Revolving Credit Facility | $283,327 |
| Total Liquidity | $324,634 |
Future Outlook
For the full year 2024, Deluxe Corporation projects revenues between $2.12 billion and $2.14 billion, alongside adjusted EBITDA between $405 million and $415 million. The company expects adjusted diluted EPS within the range of $3.20 to $3.35.
| Outlook Metrics | 2024 Projection |
|---|---|
| Total Revenue | $2.12 billion - $2.14 billion |
| Adjusted EBITDA | $405 million - $415 million |
| Adjusted Diluted EPS | $3.20 - $3.35 |
Conclusion on Mission Alignment
Deluxe Corporation's mission statement aligns with its financial performance and operational strategies, emphasizing a focus on small business success through innovative solutions and community engagement.
How Deluxe Corporation (DLX) Works
Business Overview
Deluxe Corporation operates primarily in four segments: Print, Merchant Services, B2B Payments, and Data Solutions. The company focuses on providing marketing services, checks, forms, and other business products. In 2024, it continues to adapt to declining traditional print segments while growing its digital and payment solutions.
Financial Performance
As of September 30, 2024, Deluxe Corporation reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $528,444,000 | $537,844,000 | (1.7) |
| Net Income | $8,969,000 | ($7,957,000) | 212.7 |
| Diluted EPS | $0.20 | ($0.18) | 211.1 |
| Adjusted EBITDA | $104,902,000 | $101,890,000 | 3.0 |
| Free Cash Flow | $64,345,000 | $34,097,000 | 89.0 |
Revenue Segmentation
The revenue mix for Deluxe Corporation in the third quarter of 2024 was as follows:
| Business Segment | Revenue Contribution (%) |
|---|---|
| 56.3 | |
| Merchant Services | 17.7 |
| B2B Payments | 14.2 |
| Data Solutions | 11.5 |
Segment Performance
Print Segment
In 2024, the Print segment faced a revenue decline of 2.3% in Q3 compared to 2023, primarily due to the secular decline in checks and business forms. Total revenue for the first nine months was $909,393,000, down from $942,839,000 in 2023.
Merchant Services
This segment showed growth in revenue, driven by a combination of new customer acquisitions and increased transaction volumes. The revenue contribution increased to 17.7% in Q3 2024 from 16.4% in Q3 2023.
B2B Payments
For the B2B Payments segment, total revenue slightly increased by 0.7% in Q3 2024, showing resilience amidst transitions to a recurring revenue model. However, revenue for the first nine months decreased by 5.0% compared to the prior year.
Data Solutions
The Data Solutions segment experienced a revenue decrease of 4.7% in Q3 2024 but showed a 6.2% increase for the first nine months, highlighting strong demand for customer acquisition marketing activities.
Cash Flow and Liquidity
As of September 30, 2024, Deluxe Corporation reported:
| Metric | Amount (in thousands) |
|---|---|
| Cash and Cash Equivalents | $41,307 |
| Available Borrowing Under Revolving Credit | $283,327 |
| Total Debt | $1,531,527 |
| Net Debt | $1,490,220 |
| Liquidity | $324,634 |
Outlook for 2024
Deluxe Corporation anticipates that for the full year 2024, total revenue will be between $2.12 billion and $2.14 billion. Adjusted EBITDA is expected to range from $405 million to $415 million, and adjusted diluted EPS is projected to be between $3.20 and $3.35. Free cash flow is anticipated to be between $90 million and $100 million.
How Deluxe Corporation (DLX) Makes Money
Business Segments Overview
Deluxe Corporation operates through four main business segments: Print, B2B Payments, Data Solutions, and Merchant Services. Each segment contributes to the overall revenue generation strategy of the company.
Print Segment
The Print segment remains the largest revenue driver for Deluxe, accounting for 56.3% of total revenue in Q3 2024. This segment includes checks, promotional products, business forms, and other printed materials.
| Metrics | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Total Revenue | $297,313,000 | $304,282,000 | (2.3%) |
| Adjusted EBITDA | $97,407,000 | $98,044,000 | (0.6%) |
| Adjusted EBITDA Margin | 32.8% | 32.2% | 0.6 pts. |
The decline in revenue is attributed to a secular decrease in order volumes for checks and business forms, partially offset by pricing actions in response to inflation.
B2B Payments Segment
The B2B Payments segment includes revenue from treasury management solutions and remittance processing. This segment showed slight revenue growth in Q3 2024.
| Metrics | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Total Revenue | $75,140,000 | $74,581,000 | 0.7% |
| Adjusted EBITDA | $15,264,000 | $16,074,000 | (5.0%) |
| Adjusted EBITDA Margin | 20.3% | 21.6% | (1.3) pts. |
The growth in revenue was driven by new customer implementations and modest price increases.
Data Solutions Segment
Data Solutions focuses on customer acquisition marketing and data-driven marketing services, contributing 11.5% of total revenue.
| Metrics | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Total Revenue | $61,065,000 | $64,080,000 | (4.7%) |
| Adjusted EBITDA | $17,485,000 | $15,317,000 | 14.2% |
| Adjusted EBITDA Margin | 28.6% | 23.9% | 4.7 pts. |
Revenue growth for the first nine months of 2024 was primarily driven by strong demand for marketing campaigns.
Merchant Services Segment
The Merchant Services segment includes payment processing solutions and is becoming a more significant part of Deluxe's revenue mix.
| Metrics | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Total Revenue | $93,531,000 | $87,984,000 | 6.0% |
| Adjusted EBITDA | $34,000,000 (est.) | $30,000,000 (est.) | 13.3% (est.) |
| Adjusted EBITDA Margin | 36.3% (est.) | 34.0% (est.) | 2.3 pts. (est.) |
Revenue growth was attributed to increased transaction volumes and new customer acquisition.
Financial Performance and Cash Flow
As of September 30, 2024, Deluxe Corporation reported the following financial metrics:
| Metrics | 2024 | 2023 | Change |
|---|---|---|---|
| Total Revenue | $1,601,215,000 | $1,654,896,000 | (3.2%) |
| Net Income | $40,296,000 | $11,224,000 | 259.0% |
| Diluted EPS | $0.90 | $0.25 | 260.0% |
| Free Cash Flow | $64,345,000 | $34,097,000 | $30,248,000 |
The increase in net income was driven by pricing and cost optimization actions, as well as revenue growth in the Merchant Services segment.
Outlook for 2024
Deluxe Corporation anticipates revenue for 2024 to be between $2.12 billion and $2.14 billion. Adjusted EBITDA is expected to be between $405 million and $415 million, with adjusted diluted EPS projected between $3.20 and $3.35.
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Resources:
- Deluxe Corporation (DLX) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Deluxe Corporation (DLX)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Deluxe Corporation (DLX)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.