Company: DLX
Filing Date: 2025-02-21
Form Type: 10-K
Source: 0000027996-25-000051
Chunk: 81

Company: DELUXE CORP
Filing Date: 2025-02-21
Form: 10-K
Item: Item 7A
Chunk 81
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.7 %

(1)  The carrying amount has been reduced by unamortized discount and debt issuance costs of $19 million.

(2)  For the amounts outstanding under our credit facility agreement, fair value approximates carrying value because the interest rate is variable and reflects current market rates. The fair value of the senior unsecured and senior secured notes is based on quoted prices in active markets for the identical liability when traded as an asset.

As part of our strategy to manage interest rate exposure, we periodically enter into interest rate swaps to reduce the variability in interest payments on a portion of our variable-rate debt. In December 2024, coinciding with the refinancing of our debt, we terminated our outstanding interest rate swaps and incurred an immaterial loss. Further details regarding the interest rate swaps can be found under the caption "Note 7: Derivative Financial Instruments" in the Notes to Consolidated Financial Statements located in Part II, Item 8 of this report.

As of December 31, 2024, based on the amount of variable-rate debt outstanding, a one percentage point change in the weighted-average interest rate would result in a $6 million change in interest expense for 2025.

Foreign currency exchange rate risk – We are subject to fluctuations in foreign currency exchange rates. Our investments in, and loans and advances to, foreign subsidiaries and branches, along with the operations of these entities, are denominated in foreign currencies, primarily Canadian dollars. The impact of exchange rate changes on our earnings and cash flows is expected to be minimal, given that our foreign operations constitute a relatively small portion of our overall business. At this time, we have not engaged in hedging activities to mitigate the risks associated with changes in foreign currency exchange rates.

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