Deluxe Corporation · NYSE:DLX
Deluxe — Investor Presentation (May 2025)
36 slides from Deluxe's investor presentation, May 2025
Slide 1: Investor Overview Materials
Investor Overview / Materials
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT Statements made in this presentation concerning Deluxe, the company’s or management’s intentions, expectations, outlook or predictions about future results or events are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such
Slide 3: Who We Are
WHO WE ARE
Slide 4: Deluxe Enterprise Overview: DLX at a Glance
DELUXE ENTERPRISE OVERVIEW DLX AT A GLANCE HQ FO UN D ED N Y SE Key Numbers MPLS, MN 1915 DLX Selected Operational Metrics Diversified Revenue Who We Serve $2.1B $409MM OVER 4,000 FIs LTM Q1’25 LTM Q1’25 Adjusted EBITDA FORTUNE 1000 COMPANY OPERATING IN total revenue FOUR MAIN SEGMENTS: Data 180 >$4
Slide 5: DLX History / Timeline
DLX HISTORY / TIMELINE: WE ARE HERE Declines within core Check Organic declines offset via Built a & print portfolio accelerate aggressive Portfolio M&A cohesive foundation • Secular decline trends solidify, as • ‘Supermarket’ for Banks & Small biz • Rationalized portfolio digital substitutes emerge
Slide 6: Our Strategy Is Simple
OUR STRATEGY IS SIMPLE GROW PAYMENTS & DATA, PAY DOWN DEBT, & CUT CORPORATE COSTS 6
Slide 7: Deluxe Today
DELUXE TODAY L E G A C Y P R IN T B U S I N ES S E S PAYM EN T S & D ATA B U S IN E S S E S Promotional Merchant B2B Check Data Products Services Payments • Print & deliver checks • Branded forms, deposit • Helping merchants • Helping our clients • An industry leader in for our bank and small ticket
Slide 8: Q1'25 Highlights
Q1’25 Highlights Strong Execution within increasingly volatile macroeconomic conditions 8
Slide 9: 2025 Guidance
2025 Guidance Well-positioned for sustainable growth 9
Slide 10: Clear Multi-Year Value Creation Algorithm
CLEAR MULTI-YEAR VALUE CREATION ALGORITHM OUR FOCUS BY 2026 Drive profitable organic growth in Payments and Data ~2-4% y/y revenue growth, Keep efficiency focus on Print & Corporate ~4-6% y/y EBITDA growth Increase our free cash flow by improving leverage ratio & 3x leverage reducing restructuring c
Slide 11: North Star Initiative
NORTH STAR INITIATIVE
Slide 12: Our North Star Integrated Execution Plan
OUR NORTH STAR INTEGRATED EXECUTION PLAN …ACCELERATING EXECUTION ENTERPRISE-WIDE AGAINST CORE DLX GOALS & TRANSFORMATION PROGRAM… BY 2026: DRIVERS OF TSR • Aligned to enterprise strategy & +$100MM • Prioritizing rapid cash generation to shareholder value incremental run-rate FCF fund long-term inves
Slide 13: North Star Workstreams & Timelines
NORTH STAR WORKSTREAMS & TIMELINES 13
Slide 14: $80 Million Incremental Comp. Adj. EBITDA in '26
$80 MILLION INCREMENTAL COMP. ADJ. EBITDA IN ‘26 VIA $130 MILLION NORTH STAR VALUE ($’s in Million’s) Adjusted EBITDA bridge (2023 – 2026) North Star impact +$80 ~$120 ~$470 $417 ~$10 $391 (~$26) ~$10 ~$30 (~$70) Incl. high priority growth initiatives 2023A Divestitures 2023 Comp Forecast secular Ad
Slide 15: And $100MM Incremental FCF by 2026
…AND $100MM INCREMENTAL FCF BY 2026 ~$30-40MM +~$100MM FCF Conversion ~$15-20MM (~$25-30MM) (as a % of EBITDA) +$80MM 2022 (pre-NS): 21% 2026 Target: 30+% Incremental Comp. Lower Interest Lower Other Offsets Incremental Adj. EBITDA Expense Restructuring Costs Free Cash Flow 15
Slide 16: Adj. EBITDA Increase Enables Leverage Ratio of 3x by '26
ADJ. EBITDA INCREASE ENABLES A LEVERAGE RATIO OF 3X BY ‘26 Leverage ratio = net debt / Adj. EBITDA $2.0B $1.5B Net debt $1.0B 4.0x 3.6x 3.6x ~3.3x ~3x $0.5B Adj. EBITDA $0.0B 2022 2023 2024 2025F 2026F 16
Slide 17: Three Clear Capital Allocation Priorities
Strengthen the balance sheet • Target 3x net leverage by 2026 by: • Growing EBITDA WE HAVE THREE • Paying down debt with incr. FCF CLEAR CAPITAL ALLOCATION Invest in profitable organic growth PRIORITIES: • Invest in high-return (e.g., 15%+ risk adjusted IRR) profitable organic growth in line with ou
Slide 18: Capital Structure – Debt Maturity Ladder
Capital Structure – Debt maturity ladder 18
Slide 19: 3YR Financial Projections
3YR FINANCIAL PROJECTIONS
Slide 20: Merchant Services: Financial Outlook & Business Drivers
MERCHANT SERVICES: FINANCIAL OUTLOOK & BUSINESS DRIVERS Revenue & Adj. EBITDA margin: Revenue Pre-DLX Acquisition Revenue Assuming stable macro & consumer spending +7-10% Base business drivers: $384MM • Consumer spending $364MM $329MM $348MM • Merchant base growth • Growth in FI channel • Cross-sell
Slide 21: B2B Payments: Financial Outlook & Business Drivers
B2B PAYMENTS: FINANCIAL OUTLOOK & BUSINESS DRIVERS Revenue & Adj. EBITDA margin: Revenue Assuming stable macro & consumer spending +3-7% $307MM $299MM Base business drivers: $295MM $288MM • Continued expansion of current Integrated Receivables and exception mgmt. tools • Efficiencies in item process
Slide 22: Data Solutions: Financial Outlook & Business Drivers
DATA SOLUTIONS: FINANCIAL OUTLOOK & BUSINESS DRIVERS Revenue & Adj. EBITDA margin: Comp. Adj. Revenue1 +6-10% $234MM Base business drivers: $212MM $197MM • Growth in core verticals $169MM • Grow, develop & retain top data scientists and marketers • Continued evolution of our data assets Upside busin
Slide 23: Print Business: Financial Outlook & Business Drivers
PRINT BUSINESS: FINANCIAL OUTLOOK & BUSINESS DRIVERS Revenue & Adj. EBITDA margin: Promo (Comp. Adjusted) Checks $1,277MM (1-5)% $1,223MM $1,261MM Base business drivers: $1,205MM • Continued share gain with FI customers • Stable margins via investments in print efficiencies & process improvements •
Slide 24: Forecast 5-7% Comp. Adj. EBITDA Growth Through 2026
FORECAST 5-7% COMP. ADJ. EBITDA GROWTH THROUGH 2026 Reported Revenue1 $2.02B $2.24B $2.19B CAGR: 0 - 3% ~$2.25B2 ~$470MM2 Comp. Adj. EBITDA growth: CAGR: 5-7% $418MM $417MM $408MM $407MM Reported EBITDA1 $391MM3 Comp. Adj. EBITDA 21 22 23 24 25F 26F Adj. EBITDA Margin 20.2% 18.7% ~19% +~200bps ~21%
Slide 25: Clear 3-Year Value Creation Algorithm
CLEAR 3-YEAR VALUE CREATION ALGORITHM OUR FOCUS BY 2026 Drive profitable organic growth in Payments and Data ~2-4% y/y revenue growth, Keep efficiency focus on Print & Corporate ~4-6% y/y EBITDA growth Increase our free cash flow by improving leverage ratio & 3x leverage reducing restructuring charg
Slide 26: Appendix
dix APPENDIX
Slide 27: Consolidated Condensed Statements of Income
Consolidated Condensed Statements of Income in millions, except per share amounts (Unaudited) 27
Slide 28: Segment Information
Segment Information in millions (Unaudited) 28
Slide 29: Reconciliation of GAAP to Non-GAAP Measures: EBITDA
Reconciliation of GAAP to Non-GAAP Measures EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin in millions (Unaudited) 29
Slide 30: Reconciliation of GAAP to Non-GAAP Measures: Adjusted Diluted EPS Q1 2025
Reconciliation of GAAP to Non-GAAP Measures Adjusted Diluted EPS – Q1 2025 dollars and shares in millions, except per share amounts (Unaudited) 30
Slide 31: Reconciliation of GAAP to Non-GAAP Measures: Adjusted Diluted EPS Q1 2024
Reconciliation of GAAP to Non-GAAP Measures Adjusted Diluted EPS – Q1 2024 dollars and shares in millions, except per share amounts (Unaudited) 31
Slide 32: Reconciliation of GAAP to Non-GAAP Measures: Comparable Adjusted Revenue
Reconciliation of GAAP to Non-GAAP Measures Comparable Adjusted Revenue / Comparable Adjusted EBITDA / Comparable Adjusted EBITDA Margin in millions (Unaudited) 32
Slide 33: Reconciliation of GAAP to Non-GAAP Measures: Outlook
Reconciliation of GAAP to Non-GAAP Measures Comparable Adjusted Revenue / Comparable Adjusted EBITDA / Comparable Adjusted EPS Outlook (Unaudited) Total Year 2025 Outlook 2024 Actual (in billions) $2.122 Revenue $2.090 - $2.155 Less: Business exits — (0.011) $2.111 Comparable adjusted revenue $2.090
Slide 34: Reconciliation of GAAP to Non-GAAP Measures: Net Debt to Adjusted EBITDA
Reconciliation of GAAP to Non-GAAP Measures Net Debt to Adjusted EBITDA dollars in millions (Unaudited) 34
Slide 35: Reconciliation of GAAP to Non-GAAP Measures: Free Cash Flow
Reconciliation of GAAP to Non-GAAP Measures Free Cash Flow in millions (Unaudited) 35
Slide 36: Deluxe
deluxe