Company: DLX
Filing Date: 2025-05-02
Form Type: 10-Q
Source: 0000027996-25-000142
Chunk: 21

Company: DELUXE CORP
Filing Date: 2025-05-02
Form: 10-Q
Item: Item 1
Chunk 21
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000, and we anticipate that we will incur approximately $7,000 of additional North Star restructuring and integration expense in 2025.Restructuring and integration expense is reflected on the consolidated statements of comprehensive income as follows: Quarter EndedMarch 31,(in thousands)20252024Total cost of revenue$752 $933 Operating expenses7,668 13,804 Restructuring and integration expense$8,420 $14,737 

14

DELUXE CORPORATIONCONDENSED NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS(dollars in thousands, except per share amounts)

Restructuring and integration expense for each period was comprised of the following: Quarter EndedMarch 31,(in thousands)20252024Employee severance benefits$4,453 $1,972 External consulting and other costs2,523 7,969 Internal labor988 838 Other456 3,958 Restructuring and integration expense$8,420 $14,737 Our restructuring and integration accruals are included in accrued liabilities on the consolidated balance sheets. These accruals represent the anticipated cash payments necessary to fulfill the remaining severance obligations for employees who have already been terminated, as well as those expected to be terminated under our various initiatives. We expect that the majority of employee reductions and the associated severance payments will be completed by the end of 2025.Changes in our restructuring and integration accruals were as follows:(in thousands)Employee severance benefitsBalance, December 31, 2024$3,755 Charges4,644 Reversals(191)Payments(1,845)Balance, March 31, 2025$6,363 The charges and reversals shown in the rollforward of our restructuring and integration accruals exclude items that are expensed as incurred, as these items are not included in accrued liabilities on the consolidated balance sheets.

NOTE 9:INCOME TAX PROVISIONOur effective income tax rate was 27.1% for the quarter ended March 31, 2025, while our effective income tax rate for the year ended December 31, 2024 was 30.8%. Compared to our 2024 annual rate, the 2025 tax rate benefited from lower tax impacts for our foreign operations, changes in the deferred income tax valuation allowance, and share-based compensation, partly offset by a benefit from return-to-provision adjustments recorded in 2024 that did