Deluxe Corp., St. Paul, MN, had fourth-quarter 2002 net income of $52.3 million, up from $48 million in fourth-quarter 2001. The company’s revenue declined slightly between the quarters, from $318.7 million to $306.8 million.
For the year, Deluxe’s revenue and net income rose. In 2002 it realized net income of $214.3 million on revenue of $1.284 billion, compared with net income of $185.9 million and revenue of $1.278 billion.
In both cases the company’s bottom line was helped by small reductions in its selling, general and administrative expenses. The quarter and year ended Dec. 31.
The Financial Services division, which sells checks and check products to financial institutions, saw its revenue slip from $768.5 million in 2001 to $754 million last year. Its operating income rose from $167.7 million to $181 million. The company attributed the revenue decrease to a decline in check usage resulting from the weak economy and fewer conversion programs.
The Direct Checks unit’s revenue increased to $310.9 million in 2002, compared to $305.6 million in 2001. Operating income increased to $92.4 million, from $75.4 million. Deluxe attributed these increases to higher revenue per unit, a change in accounting for goodwill, continued migration to the Internet channel and productivity improvements within the manufacturing function. Direct Checks sells checks and related products directly to consumer through direct mail and the Internet.
Business Services' revenue jumped to $219.1 million in 2002, compared to $204.3 million in 2001. Operating income within this division increased to $71.5 million from $58.8 million in 2001. The company said that increases in both unit volume and revenue per unit contributed to these results. Business Services sells Deluxe’s products to small businesses on behalf of financial institutions and directly to customers via direct mail and the Internet.
The company expects to maintain or very slightly exceed its fortunes during 2003. "Still, we will face challenges including: the sluggish economy, a decline in check volume due to the increased use of electronic payments and competitive pricing," Lawrence J. Mosner, its chairman and CEO said in a statement.
