Deluxe Corp. yesterday reported net income of $32.6 million in the second quarter ended June 30, down 9% from $36 million during the same quarter last year. The St. Paul, Minn.-based company, best known for custom printing of business and personal checks, attributed much of the dip in net income to declining check use, difficult economic conditions for small businesses and delayed orders in Canada because of new check-format rules there. Revenue for the quarter was $367.7 million, down 8% from $399.9 million the same period last year. Deluxe has been trimming expenses in recent years in response to declining check use, and last quarter it cut selling, general and administrative expenses by 12%, to $166.6 million from $189.6 million a year earlier. Deluxe employed 7,482 workers as of June 30, down 7% from 8,064 a year earlier. As part of the company's strategy to add more noncheck services, Deluxe announced Wednesday it had closed on a $100 million net acquisition of Hostopia.com. The a Mississauga, Ontario-based company provides e-commerce and Web development and hosting services to small and medium-sized businesses. During a conference call with analysts, Richard Greene, Deluxe senior vice president and chief financial officer, warned that he expects economic conditions will continue to adversely effect the company's small-business services division in the near future. He said a planned price increase for checks early in the fourth quarter should partially offset an expected dip in financial-services revenues as check writing declines another 4% to 5% this year.
Authoritative analysis and perspective for every segment of the payments industry
Authoritative analysis and perspective for every segment of the industry
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