Company: DLX
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0000027996-25-000189
Chunk: 71

Company: DELUXE CORP
Filing Date: 2025-11-06
Form: 10-Q
Item: Item 8
Chunk 71
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 discount rates, and the allocation of shared and corporate items. These assumptions require significant judgment, and actual results may differ, potentially leading to future impairment charges.For our other reporting units with goodwill, we completed qualitative analyses. These analyses considered factors such as economic, market, and industry conditions, cost factors, and the overall financial performance of the reporting units. We also considered the most recent quantitative analyses from prior periods. These qualitative analyses indicated no changes in events or circumstances suggesting that the fair value of any reporting unit was less than its carrying amount. Consequently, no goodwill impairment charges were recorded from our 2025 annual impairment analysis.

15

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

Asset acquisition – During the quarter ended September 30, 2025, we acquired intangible assets associated with JPMorgan Chase Bank’s CheckMatch electronic check conveyance service business (Note 6). In estimating the fair value of these assets, we utilized the multi-period excess earnings method. This method involved forecasting the revenue and cash flows generated by the assets, then subtracting the portions of cash flows attributable to supporting assets that contribute to overall earnings. The net cash flows attributable to the intangible assets are then discounted using a rate that reflects the associated risk, resulting in a present value estimate. Key assumptions used in this valuation included projected revenue from existing customers, anticipated customer growth, estimated earnings, expected customer retention rates, and the selected discount rate.Financial instruments – Information regarding the fair values of our financial instruments was as follows: Fair value measurements usingSeptember 30, 2025Quoted prices in active markets for identical assets(Level 1)Significant other observable inputs(Level 2)Significant unobservable inputs(Level 3)(in thousands)Balance sheet locationCarrying valueFair valueAmortized cost:Loans and notes receivable from distributorsOther current and other non-current assets$11,048$12,302$—$—$12,302Long-term debtCurrent portion of long-term debt and long-term debt1,449,7851,484,821—1,484,821— Fair value measurements usingDecember 31, 2024Quoted prices in active markets for identical assets(Level 1)Significant other observable inputs(Level 2)Significant unobservable inputs(Level 3)(in thousands)Balance sheet locationCarrying valueFair valueAmortized cost:Loans and notes receivable from