Company: DLX
Filing Date: 2025-02-21
Form Type: 10-K
Source: 0000027996-25-000051
Chunk: 69

Company: DELUXE CORP
Filing Date: 2025-02-21
Form: 10-K
Item: Item 7
Chunk 69
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 pricing and cost management actions were offset by a shift in revenue mix linked to the higher processing volumes.

32

B2B Payments

Results for our B2B Payments segment were as follows:

(in thousands)2024202320222024 vs. 20232023 vs. 2022Total revenue$287,851 $299,196 $307,117 (3.8%)(2.6%)Adjusted EBITDA57,088 62,034 71,242 (8.0%)(12.9%)Adjusted EBITDA margin19.8 %20.7 %23.2 %(0.9) pt.(2.5) pt.

Total revenue for 2024 decreased compared to 2023, primarily due to reduced lockbox processing volumes and the absence of one-time hardware and license sales that occurred in 2023. We are continuing our migration from a dependency on one-time revenue to a more recurring revenue model. Consequently, we have intentionally shifted our focus away from selling products such as check imaging devices and one-time software licenses. These reductions in revenue were partially offset by a modest price increase to counteract inflation and the onboarding of new clients in the latter half of 2024. The revenue trend improved over the course of 2024, with a year-over-year decrease of 7.8% in the first half of the year, but a slight increase of 0.4% in the second half.

Adjusted EBITDA for 2024 decreased compared to 2023, driven mainly by the reduction in revenue, ongoing inflationary pressures on labor costs, and expenses related to the initial onboarding of new remittance processing customers in the latter half of 2024. These decreases were partially offset by our cost management actions, including the consolidation of our lockbox processing operations, as well as the modest price increase. Adjusted EBITDA margin decreased year-over-year, as inflationary pressures and the costs associated with new customer implementations exceeded the benefits from our pricing and cost management actions.

Total revenue for 2023 decreased compared to 2022, primarily due to reduced volumes for our fraud and security service offerings. Treasury management revenue remained virtually flat year-over-year, as price increases implemented in response to inflation were offset by the impact of one-time revenue in 2022 and demand softness for lockbox services. 

Adjusted EBITDA for 2023 also decreased compared to 2022. This decline was primarily driven by the reduction in