EX-99.1
Published on August 6, 2025
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Exhibit 99.1
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Contact:
| Brian Anderson, VP, Strategy & Investor Relations | Keith Negrin, VP, Communications | |||||||
| 651-447-4197 | 612-669-1459 | |||||||
| brian.anderson@deluxe.com | keith.negrin@deluxe.com | |||||||
DELUXE REPORTS SECOND QUARTER 2025 RESULTS
INCREASES FULL-YEAR FREE CASH FLOW OUTLOOK
•Reported revenue decreased 3.1%, while comparable adjusted revenue decreased 2.5%.
•Net income was $22.4 million, improving from $20.5 million in 2024, on cost management and lower restructuring spend.
•Comparable adjusted EBITDA increased 4.6% to $106.5 million.
•Second quarter GAAP diluted EPS was $0.50 versus $0.46 in 2024; comparable adjusted diluted EPS improved 3.5% to $0.88.
•First half cash from operating activities was $101.4 million; free cash flow increased $34.5 million to $52.1 million.
•Affirms 2025 guidance for revenue, adjusted EBITDA, and adjusted diluted EPS, and raises free cash flow range.
Minneapolis – August 6, 2025 – Deluxe (NYSE: DLX), a trusted Payments and Data company, today reported operating results for its second quarter ended June 30, 2025.
“Our strong expansion of core earnings and operating cash flow metrics continued during the quarter, as double-digit revenue growth across Data Solutions and an improving Merchant Services trajectory helped to drive our robust operating leverage,” said Barry McCarthy, President and CEO of Deluxe. “Despite some topline headwinds experienced across lower-margin legacy promotional solutions offerings, we expanded our margin, EPS, and cash flow in line with our strategy and first-half expectations."
“We are pleased to increase our full-year free cash flow guidance on the strength of our year-to-date growth of operating cash flows, as we also saw improvement of our leverage ratio during the quarter,” said Chip Zint, Senior Vice President and Chief Financial Officer of Deluxe. “The enterprise remains focused on disciplined execution and diligent cost management aligned to the continued expansion of core earnings metrics within our outlook, over the balance of the year.”
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Second Quarter 2025 Financial Highlights
(in millions, except per share amounts)
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2nd Quarter
2025
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2nd Quarter
2024
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% Change | |||||||||||||||
| Revenue | $521.3 | $537.8 | (3.1 | %) | |||||||||||||
| Comparable Adjusted Revenue | $521.3 | $534.9 | (2.5 | %) | |||||||||||||
| Net Income | $22.4 | $20.5 | 9.3 | % | |||||||||||||
| Comparable Adjusted EBITDA | $106.5 | $101.8 | 4.6 | % | |||||||||||||
| Diluted EPS | $0.50 | $0.46 | 8.7 | % | |||||||||||||
| Comparable Adjusted Diluted EPS | $0.88 | $0.85 | 3.5 | % | |||||||||||||
•Revenue for the second quarter decreased 3.1% from the previous year. Comparable adjusted revenue, reflecting the removal of business exits, decreased 2.5% compared to the previous year.
•Net income of $22.4 million was up from $20.5 million in the second quarter of 2024.
•Comparable adjusted EBITDA margin was 20.4%, up 140 basis points from the prior year.
•Comparable adjusted diluted EPS of $0.88 was up 3.5% year over year.
Outlook
The Company updated its full-year 2025 outlook ranges as noted below:
•Affirmed Revenue of $2.090 to $2.155 billion
•Affirmed Adjusted EBITDA of $415 to $435 million
•Affirmed Adjusted diluted EPS of $3.25 to $3.55
•Raised Free cash flow to between $130 and $150 million
This guidance remains subject to, among other things, prevailing macroeconomic conditions, global instability including tariffs, labor supply challenges, and inflation, as well as the impact of other potential changes to the company's portfolio.
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 September 2, 2025, to shareholders of record as of market closing on August 18, 2025.
Earnings Call Information
Deluxe management will host a conference call today at 5:00 p.m. ET (4:00 p.m. CT) to review the financial results. Listeners can access the call by dialing 1-888-394-8218 (access code 5158683). The audio and accompanying slides will be available via a simultaneous webcast on the investor relations
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website at www.investors.deluxe.com. A replay will be available after 8:00 p.m. ET through midnight on August 13, 2025, via the webcast link and listen-by-phone option.
About Deluxe Corporation
Deluxe, a trusted Payments and Data company, champions business so communities thrive. Our solutions help businesses pay, get paid, and grow. 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, while processing more than $2 trillion in annual payment volume. 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.x.com/deluxe.
Forward-Looking Statements
Statements made in this presentation regarding Deluxe, the company’s, or management’s intentions, expectations, outlook, or predictions about future results or events are considered “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. These statements reflect management’s current intentions or beliefs and are subject to risks and uncertainties that could cause actual results or events to differ from stated expectations, which variations could be material and adverse. Factors that could lead to such variations include, but are not limited to, the following: changes in local, regional, national, and international economic or political conditions, including those arising from heightened inflation, rising interest rates, a recession, uncertainties surrounding trade policies or tariffs, or intensified international hostilities, and their impact on the company, its data, customers, or demand for the company’s products and services; the effects of proposed and enacted legislative and regulatory actions affecting the company or the financial services industry as a whole; ongoing cost increases and/or declines in the availability of data, materials, and other services; the company’s ability to execute its 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; consolidation of financial institutions and/or bank failures, 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 data 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 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
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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, 2024, 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 June 30, |
Six Months Ended June 30, |
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| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Revenue | $521.3 | $537.8 | $1,057.7 | $1,072.8 | |||||||||||||||||||
Cost of revenue |
(242.0) | (249.0) | (497.4) | (500.5) | |||||||||||||||||||
| Gross profit | 279.3 | 288.8 | 560.3 | 572.3 | |||||||||||||||||||
Selling, general and administrative expense |
(214.5) | (233.9) | (439.8) | (467.9) | |||||||||||||||||||
| Restructuring and integration expense | (4.0) | (11.0) | (11.7) | (24.9) | |||||||||||||||||||
| Gain on sale of businesses and long-lived assets | — | 15.4 | — | 24.0 | |||||||||||||||||||
| Operating income | 60.8 | 59.3 | 108.8 | 103.5 | |||||||||||||||||||
| Interest expense | (30.9) | (30.2) | (62.2) | (61.0) | |||||||||||||||||||
| Other income | 1.8 | 1.8 | 4.3 | 4.7 | |||||||||||||||||||
| Income before income taxes | 31.7 | 30.9 | 50.9 | 47.2 | |||||||||||||||||||
| Income tax provision | (9.3) | (10.4) | (14.4) | (15.9) | |||||||||||||||||||
| Net income | 22.4 | 20.5 | 36.5 | 31.3 | |||||||||||||||||||
| Non-controlling interest | — | — | (0.1) | — | |||||||||||||||||||
| Net income attributable to Deluxe | $22.4 | $20.5 | $36.4 | $31.3 | |||||||||||||||||||
| Weighted average dilutive shares | 45.2 | 44.7 | 45.2 | 44.6 | |||||||||||||||||||
| Diluted earnings per share | $0.50 | $0.46 | $0.80 | $0.70 | |||||||||||||||||||
| Adjusted diluted earnings per share | 0.88 | 0.86 | 1.62 | 1.62 | |||||||||||||||||||
| Comparable adjusted diluted earnings per share | 0.88 | 0.85 | 1.62 | 1.57 | |||||||||||||||||||
| Depreciation and amortization expense | 33.5 | 41.7 | 68.8 | 83.4 | |||||||||||||||||||
| EBITDA | 96.1 | 102.8 | 181.8 | 191.6 | |||||||||||||||||||
| Adjusted EBITDA | 106.5 | 103.4 | 206.6 | 203.8 | |||||||||||||||||||
| Comparable adjusted EBITDA | 106.5 | 101.8 | 206.6 | 198.6 | |||||||||||||||||||
DELUXE CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(dollars and shares in millions)
(Unaudited)
| June 30, 2025 |
December 31, 2024 |
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| Cash and cash equivalents | $26.0 | $34.4 | |||||||||
| Other current assets | 319.7 | 577.2 | |||||||||
| Property, plant and equipment | 104.3 | 111.6 | |||||||||
| Operating lease assets | 45.5 | 49.4 | |||||||||
| Intangibles | 314.1 | 331.1 | |||||||||
| Goodwill | 1,422.8 | 1,422.7 | |||||||||
| Other non-current assets | 302.6 | 304.6 | |||||||||
| Total assets | $2,535.0 | $2,831.0 | |||||||||
| Current portion of long-term debt | $37.2 | $37.1 | |||||||||
| Other current liabilities | 329.7 | 588.4 | |||||||||
| Long-term debt | 1,433.4 | 1,466.0 | |||||||||
| Non-current operating lease liabilities | 43.6 | 49.0 | |||||||||
| Other non-current liabilities | 52.4 | 69.6 | |||||||||
| Shareholders' equity | 638.7 | 620.9 | |||||||||
| Total liabilities and shareholders' equity | $2,535.0 | $2,831.0 | |||||||||
| Net debt | $1,444.6 | $1,468.7 | |||||||||
| Shares outstanding | 44.9 | 44.3 | |||||||||
DELUXE CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(in millions)
(Unaudited)
| Six Months Ended June 30, |
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| 2025 | 2024 | ||||||||||
| Cash provided (used) by: | |||||||||||
| Operating activities: | |||||||||||
| Net income | $36.5 | $31.3 | |||||||||
| Depreciation and amortization of intangibles | 68.8 | 83.4 | |||||||||
| Gain on sale of businesses and long-lived assets | — | (24.0) | |||||||||
| Other | (3.9) | (24.5) | |||||||||
| Total operating activities | 101.4 | 66.2 | |||||||||
| Investing activities: | |||||||||||
| Proceeds from sale of businesses and long-lived assets | 2.0 | 4.7 | |||||||||
| Purchases of capital assets | (49.3) | (48.6) | |||||||||
| Other | 3.0 | — | |||||||||
| Total investing activities | (44.3) | (43.9) | |||||||||
| Financing activities: | |||||||||||
| Net change in debt, including debt issuance costs | (34.3) | (37.4) | |||||||||
| Dividends | (28.1) | (27.5) | |||||||||
| Change in settlement processing obligations | (258.4) | (328.4) | |||||||||
| Other | (5.5) | (5.3) | |||||||||
| Total financing activities | (326.3) | (398.6) | |||||||||
| Effect of exchange rate change on cash, cash equivalents, restricted cash, and restricted cash equivalents | 1.5 | (3.7) | |||||||||
| Net change in cash, cash equivalents, restricted cash, and restricted cash equivalents | (267.7) | (380.0) | |||||||||
| Cash, cash equivalents, restricted cash, and restricted cash equivalents, beginning of year | 309.2 | 458.0 | |||||||||
| Cash, cash equivalents, restricted cash, and restricted cash equivalents, end of period | $41.5 | $78.0 | |||||||||
Free cash flow |
$52.1 | $17.6 | |||||||||
DELUXE CORPORATION
SEGMENT INFORMATION
(In millions)
(Unaudited)
| Quarter Ended June 30, |
Six Months Ended June 30, |
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| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Revenue: | |||||||||||||||||||||||
| Merchant Services | $101.4 | $98.5 | $199.2 | $195.0 | |||||||||||||||||||
| B2B Payments | 71.0 | 70.2 | 141.1 | 139.7 | |||||||||||||||||||
| Data Solutions | 67.8 | 57.4 | 145.1 | 117.1 | |||||||||||||||||||
| 281.1 | 308.8 | 572.3 | 612.1 | ||||||||||||||||||||
Business exits(1)
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— | 2.9 | — | 8.9 | |||||||||||||||||||
| Total | $521.3 | $537.8 | $1,057.7 | $1,072.8 | |||||||||||||||||||
| Comparable Adjusted Revenue | $521.3 | $534.9 | $1,057.7 | $1,063.9 | |||||||||||||||||||
| Adjusted EBITDA: | |||||||||||||||||||||||
| Merchant Services | $21.7 | $19.2 | $43.1 | $40.6 | |||||||||||||||||||
| B2B Payments | 15.6 | 14.0 | 28.9 | 27.3 | |||||||||||||||||||
| Data Solutions | 20.4 | 15.8 | 40.0 | 30.7 | |||||||||||||||||||
| 90.4 | 93.9 | 181.2 | 184.8 | ||||||||||||||||||||
Business Exits(1) / Corporate
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(41.6) | (39.5) | (86.6) | (79.6) | |||||||||||||||||||
| Total | $106.5 | $103.4 | $206.6 | $203.8 | |||||||||||||||||||
| Comparable Adjusted EBITDA | $106.5 | $101.8 | $206.6 | $198.6 | |||||||||||||||||||
| Adjusted EBITDA Margin: | |||||||||||||||||||||||
| Merchant Services | 21.4 | % | 19.5 | % | 21.6 | % | 20.8 | % | |||||||||||||||
| B2B Payments | 22.0 | % | 19.9 | % | 20.5 | % | 19.5 | % | |||||||||||||||
| Data Solutions | 30.1 | % | 27.5 | % | 27.6 | % | 26.2 | % | |||||||||||||||
| 32.2 | % | 30.4 | % | 31.7 | % | 30.2 | % | ||||||||||||||||
| Total | 20.4 | % | 19.2 | % | 19.5 | % | 19.0 | % | |||||||||||||||
| Comparable Adjusted EBITDA | 20.4 | % | 19.0 | % | 19.5 | % | 18.7 | % | |||||||||||||||
(1) Includes the payroll and human resources services business, which the company substantially exited during 2024.
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, 2024.
DELUXE CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(in millions)
(Unaudited)
The company has not reconciled the adjusted EBITDA, adjusted diluted EPS, or free cash flow outlook for 2025 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 some of these reconciling items affect cash flows from operating activities. Due to the significant uncertainty and variability associated with certain forward-looking reconciling items such as asset impairment charges, restructuring and integration expense, gains and losses on sales of businesses and long-lived assets, and certain legal and environmental expenses, a reconciliation of the outlook for these non-GAAP financial measures to the corresponding GAAP measures is not available without unreasonable effort. The potential impact of these reconciling items is substantial and, based on past experience, could be material.
EBITDA, ADJUSTED EBITDA, AND ADJUSTED EBITDA MARGIN
Management believes that EBITDA, adjusted EBITDA, and adjusted EBITDA margin are useful metrics for evaluating the company's operating performance. These measures eliminate the effect of interest expense, income taxes, the accounting effects of capital investments (i.e., depreciation and amortization), and certain other items that may vary for reasons unrelated to current period operating performance. Management uses these measures to assess the operating results and performance of the business, perform analytical comparisons, and identify strategies to improve performance. Additionally, management believes that an increasing adjusted EBITDA and adjusted EBITDA margin indicate an increase in the company's value. It is important to note that management does not consider EBITDA or adjusted EBITDA to be measures of cash flow, as they do not account for 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 June 30, |
Six Months Ended June 30, |
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| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net income | $22.4 | $20.5 | $36.5 | $31.3 | |||||||||||||||||||
| Non-controlling interest | — | — | (0.1) | — | |||||||||||||||||||
| Interest expense | 30.9 | 30.2 | 62.2 | 61.0 | |||||||||||||||||||
| Income tax provision | 9.3 | 10.4 | 14.4 | 15.9 | |||||||||||||||||||
| Depreciation and amortization expense | 33.5 | 41.7 | 68.8 | 83.4 | |||||||||||||||||||
| EBITDA | 96.1 | 102.8 | 181.8 | 191.6 | |||||||||||||||||||
| Restructuring and integration expense | 4.2 | 11.0 | 12.7 | 25.8 | |||||||||||||||||||
| Share-based compensation expense | 6.2 | 5.0 | 11.6 | 10.1 | |||||||||||||||||||
| Certain legal and environmental expense | — | — | 0.5 | 0.3 | |||||||||||||||||||
| Gain on sale of businesses and long-lived assets | — | (15.4) | — | (24.0) | |||||||||||||||||||
| Adjusted EBITDA | $106.5 | $103.4 | $206.6 | $203.8 | |||||||||||||||||||
| Adjusted EBITDA as a percentage of revenue (adjusted EBITDA margin) | 20.4 | % | 19.2 | % | 19.5 | % | 19.0 | % | |||||||||||||||
DELUXE CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (continued)
(in millions, except per share amounts)
(Unaudited)
ADJUSTED DILUTED EPS AND COMPARABLE ADJUSTED DILUTED EPS
Management believes that adjusted diluted EPS and comparable adjusted diluted EPS are valuable metrics for providing comparable information that assists in analyzing current period operating performance and assessing future operating performance. By excluding the impact of non-cash items or items that may not be indicative of current period operating performance, adjusted diluted EPS offers a useful view of underlying business performance. While it is reasonable to expect that one or more of the excluded items will occur in future periods, the amounts recognized may vary significantly. Comparable adjusted diluted EPS also excludes the impact of business exits, allowing management to evaluate comparable results on a year-over-year basis. Management does not consider adjusted diluted EPS or comparable adjusted diluted EPS to be substitutes for GAAP performance measures, but believes that they are useful performance measures that should be considered in addition to GAAP performance measures.
| Quarter Ended June 30, |
Six Months Ended June 30, |
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| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net income | $22.4 | $20.5 | $36.5 | $31.3 | |||||||||||||||||||
| Non-controlling interest | — | — | (0.1) | — | |||||||||||||||||||
| Net income attributable to Deluxe | 22.4 | 20.5 | 36.4 | 31.3 | |||||||||||||||||||
| Acquisition amortization | 11.4 | 14.0 | 23.2 | 28.8 | |||||||||||||||||||
| Accelerated amortization | — | 6.8 | — | 9.9 | |||||||||||||||||||
| Restructuring and integration expense | 4.2 | 11.0 | 12.7 | 25.8 | |||||||||||||||||||
| Share-based compensation expense | 6.2 | 5.0 | 11.6 | 10.1 | |||||||||||||||||||
| Certain legal and environmental expense | — | — | 0.5 | 0.3 | |||||||||||||||||||
| Gain on sale of businesses and long-lived assets | — | (15.4) | — | (24.0) | |||||||||||||||||||
| Adjustments, pre-tax | 21.8 | 21.4 | 48.0 | 50.9 | |||||||||||||||||||
Income tax provision impact of pretax adjustments(1)
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(4.6) | (3.5) | (10.9) | (9.9) | |||||||||||||||||||
| Adjustments, net of tax | 17.2 | 17.9 | 37.1 | 41.0 | |||||||||||||||||||
| Adjusted net income attributable to Deluxe | 39.6 | 38.4 | 73.5 | 72.3 | |||||||||||||||||||
| Re-measurement of share-based awards classified as liabilities | — | — | (0.1) | — | |||||||||||||||||||
Adjusted income attributable to Deluxe available to common shareholders (A)
|
$39.6 | $38.4 | $73.4 | $72.3 | |||||||||||||||||||
| Business exits, pretax | — | (0.7) | — | (2.8) | |||||||||||||||||||
Income tax provision impact of business exits(1)
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— | 0.2 | — | 0.7 | |||||||||||||||||||
| Business exits, net of tax | — | (0.5) | — | (2.1) | |||||||||||||||||||
Comparable adjusted income available to common shareholders (B)
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$39.6 | $37.9 | $73.4 | $70.2 | |||||||||||||||||||
Weighted-average dilutive shares (C)
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45.2 | 44.7 | 45.2 | 44.6 | |||||||||||||||||||
Adjusted Diluted EPS (A) / (C)
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$0.88 | $0.86 | $1.62 | $1.62 | |||||||||||||||||||
Comparable Adjusted Diluted EPS (B) / (C)
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$0.88 | $0.85 | $1.62 | $1.57 | |||||||||||||||||||
(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.
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 considers the measures of comparable adjusted revenue, comparable adjusted EBITDA, and comparable adjusted EBITDA margin, which exclude the impact of business exits, as important indicators for assessing, evaluating, and improving the company's performance. By excluding the effects of business exits, management can evaluate comparable results on a year-over-year basis. These measures allow management to compare operational performance across fiscal periods when acquisitions or business exits occur.
| Quarter Ended June 30, |
Six Months Ended June 30, |
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| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||||
| Revenue | $521.3 | $537.8 | $1,057.7 | $1,072.8 | ||||||||||||||||||||||
| Business exits | — | (2.9) | — | (8.9) | ||||||||||||||||||||||
| Comparable adjusted revenue | $521.3 | $534.9 | $1,057.7 | $1,063.9 | ||||||||||||||||||||||
Adjusted EBITDA(1)
|
$106.5 | $103.4 | $206.6 | $203.8 | ||||||||||||||||||||||
| Business exits | — | (1.6) | — | (5.2) | ||||||||||||||||||||||
| Comparable adjusted EBITDA | $106.5 | $101.8 | $206.6 | $198.6 | ||||||||||||||||||||||
| Comparable adjusted EBITDA margin | 20.4 | % | 19.0 | % | 19.5 | % | 18.7 | % | ||||||||||||||||||
(1) The reconciliation of net income to adjusted EBITDA can be found on a preceding page.
NET DEBT
Net debt is calculated by subtracting cash and cash equivalents from total debt. One limitation associated with using net debt is that by subtracting cash and cash equivalents, it may imply that management intends to use these funds to reduce outstanding debt. Additionally, net debt can suggest that the company's debt obligations are lower than what the most comparable GAAP measure indicates. Despite these limitations, management believes that net debt is a valuable metric for assessing the company's financial leverage and overall balance sheet health. It provides a measure of the company's debt burden considering the funds available to offset debt obligations.
| June 30, 2025 |
December 31, 2024 |
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| Total debt | $1,470.6 | $1,503.1 | |||||||||
| Cash and cash equivalents | (26.0) | (34.4) | |||||||||
| Net debt | $1,444.6 | $1,468.7 | |||||||||
DELUXE CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (continued)
(in millions)
(Unaudited)
FREE CASH FLOW
Free cash flow is calculated as net cash provided by operating activities minus purchases of capital assets. Management considers free cash flow to be an important indicator of cash available for servicing debt and for shareholders, after making necessary capital investments to maintain or expand the company's asset base. One limitation of using the free cash flow measure is that not all of the free cash flow is available for discretionary spending. The company may have mandatory debt payments and other cash requirements that must be deducted from available cash. Despite this limitation, management believes that the measure of free cash flow offers an additional metric to consistently compare cash generated by operations. It also provides insight into the cash flow available to fund various items such as dividends, mandatory and discretionary debt reduction, acquisitions or other strategic investments, and share repurchases.
| Quarter Ended June 30, |
Six Months Ended June 30, |
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| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||||
| Net cash provided by operating activities | $51.1 | $39.6 | $101.4 | $66.2 | ||||||||||||||||||||||
| Purchases of capital assets | (23.3) | (28.2) | (49.3) | (48.6) | ||||||||||||||||||||||
| Free cash flow | $27.8 | $11.4 | $52.1 | $17.6 | ||||||||||||||||||||||
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