Deluxe Corporation · NYSE:DLX
Deluxe — Sidoti Conference (March 2021)
20 slides from Deluxe's conference presentation, Mar 24, 2021
Slide 1: Investor Presentation
Investor Presentation March 24, 2021 © 2020 Deluxe Corporation
Slide 2: Cautionary Statement
Cautionary Statement This presentation highlights management’s intentions, projections, financial estimates or expectations about the company's future strategy or performance and are forward-looking in nature as defined in the Private Securities Litigation Reform Act of 1995. These comments are subj
Slide 3: Tech Company with Strong Cash Flow
FY 2020 Tech Company with Strong Total Company Revenue ~$1.8B Cash Flow Payments Revenue | % Company Revenue Focus on capital efficient, scalable businesses in growth ~$302M | 17% markets Cloud Solutions Revenue | % Company Revenue Powerful reach, sales and distribution channels ~$ 253M | 14% Recurr
Slide 4: Payments
2020 Revenue $302M 2020 Adjusted EBITDA 23% Payments 2020 % Company Revenue Expected LT Growth 17% Mid-teens High Growth Segment in Strong Secular Growth Market: Enabling Businesses to Pay and Get Paid Our Solutions Our Scale Where We Win Why We Win Receivables as a Service Helping our bank partners
Slide 5: Cloud Solutions
2020 Revenue $253M 2020 Adjusted EBITDA 24% Cloud Solutions 2020 % Company Revenue Expected LT Growth 14% Mid-single digit Moderate Growth Segment to Grow Enterprises and Start / Manage SMBs Our Solutions Where We Win Why We Win? Data Analytics FIs and Enterprises • Sophisticated AI tools Full-servi
Slide 6: Promotional Solutions
2020 Revenue $530M 2020 Adjusted EBITDA 13% Promotional Solutions 2020 % Company Revenue Expected LT Growth 30% Low-single digit Tech Platform: Helps business manage their Brand. Produce and Manage: Physical Business-Branded Products. Our Solutions Where We Win Why We Win? • Omni-channel distributio
Slide 7: Checks
2020 Revenue $706M 2020 Adjusted EBITDA 48% Checks 2020 % Company Revenue Expected LT Growth 39% Mid-single digit decline Profitable Strategic Asset to Self-Fund Growth Solutions Where We Win Why We Win Strong cash flow organically funds growth AND Growing market share among • Superior Product – app
Slide 8: Uniquely Powering Companies Through Lifecycle
Uniquely Powering Companies Through Lifecycle Meaningful cross-sell opportunities START YOUR BRAND YOUR GROW YOUR OPTIMIZE YOUR BUSINESS BUSINESS BUSINESS BUSINESS Payroll Digital Checks Forms Website & Solutions Payments Hosting Retail Licenses Packaging Data-Driven and IDs Print Marketing TM Marke
Slide 9: Executing Clear and Durable Strategy
Executing Clear and Durable Strategy 4 Pillars Driving Future Growth Promotional Growth Sales Solutions Checks Businesses Profitability • Unified Go-To-Market sales • Focus on growing • Adjust revenue mix • Capture new market share approach Payments and Cloud • Enhance distribution model • Hold marg
Slide 10: 2020 Accomplishments
2020 Accomplishments Foundation Built in Middle of COVID – Now Well Positioned for Growth in 2021 and Beyond New Go-To-Market Historic Leadership Approach Transformation Expanded and deepened Record sales performance – 6 Full corporate re-segmentation; leadership; executed on clear 4 0f 10 biggest d
Slide 11: Exited 2020 Financially Stronger Despite COVID
Despite COVID….. Exited 2020 Financially Stronger Cash Flow Highlights Full Year Financial Results • Delivered free cash flow of $155.0M, down $65.1M y/y Revenue decline compared - Decline due to COVID-related impacts, non-core Cloud business exits described last year, and to last year ($1.791B) con
Slide 12: 2021 Guidance
2021 Guidance Resilient Business Model – Well Positioned for Growth Full Year 2021 Outlook • Exit growth rate: mid-single digit Accelerating Transformation • FY revenue growth of 0% to 2% • Capital expenditures = ~$90M • FY Adjusted EBITDA margin between 20% and 21% • Q1 2021 will be a continuation
Slide 13: Deluxe: A Compelling Investment Opportunity
Deluxe: A Compelling Investment Opportunity ~$1.8B Fintech Hidden Gem: Payments | Cloud Solutions | Promotional Solutions | Checks Who We Are Purpose Values Customers First | Earn Trust | Create What’s Next | Trusted Business Technology™ company “Champions of business so communities thrive” Deliver
Slide 14: deluxe. trusted business technology
deluxe. trusted business technology
Slide 15: Appendix
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Slide 16: Consolidated Condensed Statements of Income (Loss)
Consolidated Condensed Statements of Income (Loss) » $ in millions, except per share amounts (Unaudited) Quarter Ended December 31, Year Ended December 31, 2020 2019 2020 2019 Product revenue $322.5 $365.3 $1,230.7 $1,409.1 Service revenue 132.0 156.8 560.1 599.6 Total revenue 454.5 522.1 1,790.8 2,
Slide 17: Segment Information
Segment Information $ in millions (Unaudited) Quarter Ended December 31, Year Ended December 31, 2020 2019 2020 2019 Revenue: Payments $78.0 $75.7 $301.9 $269.6 Cloud Solutions 59.2 81.2 252.8 318.4 Promotional Solutions 144.0 172.7 529.6 640.9 Checks 173.3 192.5 706.5 779.8 Total $454.5 $522.1 $1,7
Slide 18: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures (EBITDA and adjusted EBITDA) Quarter Ended December 31, Year Ended December 31, Management discloses EBITDA and Adjusted EBITDA because it believes they are useful in evaluating the company's operating performance, as 2020 2019 2020 2019 the calculations e
Slide 19: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures Adjusted Diluted EPS By excluding the impact of non-cash items or items that may not be Quarter Ended December 31, Year Ended December 31, indicative of ongoing operations, management believes that Adjusted 2020 2019 2020 2019 Diluted EPS provides useful c
Slide 20: Net Debt and Free Cash Flow
Net Debt and Free Cash Flow $ in millions, except per share amounts (Unaudited) NET DEBT Net debt is not a GAAP financial measure. Nevertheless, management believes that net debt is December 31, 2020 December 31,2019 an important measure to monitor leverage and evaluate the balance sheet. In calcula