10-Q 1 dlx-20220331.htm DELUXE CORPORATION 10-Q 03.31.2022 dlx-20220331
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2022
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from  __________ to ___________

Commission file number: 1-7945
dlx-20220331_g1.jpg

DELUXE CORPORATION
(Exact name of registrant as specified in its charter) 
MN41-0216800
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
801 S. Marquette Ave.MinneapolisMN55402-2807
(Address of principal executive offices)
(Zip Code)

(651) 483-7111
(Registrant’s telephone number, including area code)
 
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
Common Stock, par value $1.00 per shareDLXNYSE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes    ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit and post such files). Yes   ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large Accelerated FilerAccelerated Filer
Non-accelerated Filer Smaller Reporting Company
Emerging Growth Company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes   No

The number of shares outstanding of registrant’s common stock as of April 27, 2022 was 42,990,561.
1


PART I – FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

DELUXE CORPORATION
CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands, except share par value)March 31,
2022
December 31,
2021
ASSETS  
Current assets:  
Cash and cash equivalents$44,059 $41,231 
Trade accounts receivable, net of allowance for credit losses
184,335 197,947 
Inventories and supplies34,527 34,928 
Funds held for customers, including securities carried at fair value of $13,027 and $13,307, respectively
156,752 254,795 
Prepaid expenses47,964 37,643 
Revenue in excess of billings
33,689 30,393 
Other current assets16,858 23,536 
Total current assets518,184 620,473 
Deferred income taxes1,957 2,180 
Long-term investments
47,380 47,201 
Property, plant and equipment, net of accumulated depreciation of $341,046 and $338,617, respectively
124,270 125,966 
Operating lease assets53,375 58,236 
Intangibles, net of accumulated amortization of $718,169 and $698,764, respectively
499,531 510,724 
Goodwill1,430,156 1,430,141 
Other non-current assets279,456 279,463 
Total assets$2,954,309 $3,074,384 
LIABILITIES AND SHAREHOLDERS’ EQUITY  
Current liabilities:  
Accounts payable$146,267 $153,072 
Funds held for customers155,955 256,257 
Accrued liabilities201,913 216,832 
Current portion of long-term debt57,227 57,197 
Total current liabilities561,362 683,358 
Long-term debt1,635,191 1,625,752 
Operating lease liabilities53,418 56,444 
Deferred income taxes68,324 75,121 
Other non-current liabilities56,999 59,111 
Commitments and contingencies (Note 13)
Shareholders' equity:  
Common shares $1 par value (authorized: 500,000 shares; outstanding: March 31, 2022 – 42,923; December 31, 2021 – 42,679)
42,923 42,679 
Additional paid-in capital62,676 57,368 
Retained earnings502,125 505,763 
Accumulated other comprehensive loss(29,025)(31,492)
Non-controlling interest316 280 
Total shareholders’ equity579,015 574,598 
Total liabilities and shareholders’ equity$2,954,309 $3,074,384 


See Condensed Notes to Unaudited Consolidated Financial Statements
2



DELUXE CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
Quarter Ended
March 31,
(in thousands, except per share amounts)20222021
Product revenue$317,303 $299,053 
Service revenue238,712 142,211 
Total revenue556,015 441,264 
Cost of products(114,361)(107,325)
Cost of services (134,833)(71,184)
Total cost of revenue(249,194)(178,509)
Gross profit306,821 262,755 
Selling, general and administrative expense(259,699)(212,436)
Restructuring and integration expense(16,244)(14,313)
Operating income30,878 36,006 
Interest expense(20,324)(4,524)
Other income2,004 2,033 
Income before income taxes12,558 33,515 
Income tax provision(2,878)(9,190)
Net income9,680 24,325 
Net income attributable to non-controlling interest(36)(33)
Net income attributable to Deluxe$9,644 $24,292 
Total comprehensive income$12,147 $25,934 
Comprehensive income attributable to Deluxe12,111 25,901 
Basic earnings per share0.23 0.58 
Diluted earnings per share0.22 0.57 


See Condensed Notes to Unaudited Consolidated Financial Statements

3


DELUXE CORPORATION
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(unaudited)

(in thousands)Common sharesCommon shares
par value
Additional paid-in capitalRetained earningsAccumulated other comprehensive lossNon-controlling interestTotal
Balance, December 31, 2021
42,679 $42,679 $57,368 $505,763 $(31,492)$280 $574,598 
Net income— — — 9,644 — 36 9,680 
Cash dividends ($0.30 per share)
— — — (13,282)— — (13,282)
Common shares issued379 379 1,152 — — — 1,531 
Common shares retired(135)(135)(4,026)— — — (4,161)
Employee share-based compensation
— — 8,182 — — — 8,182 
Other comprehensive income
— — — — 2,467 — 2,467 
Balance, March 31, 2022
42,923 $42,923 $62,676 $502,125 $(29,025)$316 $579,015 


(in thousands)Common sharesCommon shares
par value
Additional paid-in capitalRetained earningsAccumulated other comprehensive lossNon-controlling interestTotal
Balance, December 31, 2020
41,973 $41,973 $17,558 $522,599 $(41,433)$141 $540,838 
Net income— — — 24,292 — 33 24,325 
Cash dividends ($0.30 per share)
— — — (12,832)— — (12,832)
Common shares issued194 194 847 — — — 1,041 
Common shares retired(63)(63)(2,298)— — — (2,361)
Employee share-based compensation
— — 6,199 — — — 6,199 
Other comprehensive income
— — — — 1,609 — 1,609 
Balance, March 31, 2021
42,104 $42,104 $22,306 $534,059 $(39,824)$174 $558,819 


See Condensed Notes to Unaudited Consolidated Financial Statements

4


DELUXE CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
 Quarter Ended March 31,
(in thousands)20222021
Cash flows from operating activities:  
Net income$9,680 $24,325 
Adjustments to reconcile net income to net cash provided by operating activities:  
Depreciation5,438 4,516 
Amortization of intangibles36,159 23,264 
Operating lease expense5,570 4,576 
Amortization of prepaid product discounts8,924 7,440 
Deferred income taxes(7,524)5,245 
Employee share-based compensation expense8,142 6,742 
Other non-cash items, net8,213 2,418 
Changes in assets and liabilities:  
Trade accounts receivable12,248 23,122 
Inventories and supplies(893)1,042 
Other current assets(12,731)(19,711)
Payments for cloud computing arrangement implementation costs(6,391)(8,915)
Other non-current assets(3,082)(953)
Accounts payable(5,003)(3,543)
Prepaid product discount payments(7,859)(9,590)
Other accrued and non-current liabilities(16,626)(20,397)
Net cash provided by operating activities34,265 39,581 
Cash flows from investing activities:  
Purchases of capital assets(20,844)(21,670)
Other515 (180)
Net cash used by investing activities(20,329)(21,850)
Cash flows from financing activities:  
Proceeds from issuing long-term debt and swingline loans146,500 5,000 
Payments on long-term debt and swingline loans(137,938)(5,000)
Net change in customer funds obligations(99,240)1,659 
Proceeds from issuing shares798 673 
Employee taxes paid for shares withheld(4,161)(2,360)
Cash dividends paid to shareholders(13,317)(12,932)
Other(2,610)(1,271)
Net cash used by financing activities(109,968)(14,231)
Effect of exchange rate change on cash, cash equivalents, restricted cash and restricted cash equivalents
1,320 1,606 
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents(94,712)5,106 
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year285,491 229,409 
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of period (Note 3)$190,779 $234,515 


See Condensed Notes to Unaudited Consolidated Financial Statements
5

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

NOTE 1: CONSOLIDATED FINANCIAL STATEMENTS

The consolidated balance sheet as of March 31, 2022, the consolidated statements of comprehensive income for the quarters ended March 31, 2022 and 2021, the consolidated statements of shareholders’ equity for the quarters ended March 31, 2022 and 2021 and the consolidated statements of cash flows for the quarters ended March 31, 2022 and 2021 are unaudited. The consolidated balance sheet as of December 31, 2021 was derived from audited consolidated financial statements, but does not include all disclosures required by U.S. generally accepted accounting principles (GAAP). In the opinion of management, all adjustments necessary for a fair statement of the consolidated financial statements are included. Adjustments consist only of normal recurring items, except for any items discussed in the notes below. Interim results are not necessarily indicative of results for a full year. The consolidated financial statements and notes are presented in accordance with instructions for Form 10-Q and do not contain certain information included in our annual consolidated financial statements and notes. The consolidated financial statements and notes appearing in this report should be read in conjunction with the consolidated audited financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2021 (the 2021 Form 10-K).

The preparation of our consolidated financial statements requires us to make certain estimates and assumptions affecting the amounts reported in the consolidated financial statements and related notes. We base our estimates on historical experience and on various other factors and assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of our assets, liabilities, revenues and expenses and the related disclosure of contingent assets and liabilities. Actual results may differ significantly from our estimates and assumptions.

Comparability The consolidated statement of cash flows for the quarter ended March 31, 2021 has been modified to confirm to the current year presentation. We presented payments for cloud computing arrangement implementation costs separately within cash flows from operating activities. Previously, this amount was included in other non-current assets. Also, we included purchases of and proceeds from customer funds marketable securities within other investing activities. Previously, these amounts were presented separately. During the quarter ended March 31, 2022, we recorded out-of-period correcting adjustments that decreased net income attributable to Deluxe by $2,197. These adjustments were not material to any historical interim or annual period.


NOTE 2: NEW ACCOUNTING PRONOUNCEMENT

In March 2022, the Financial Accounting Standards Board issued Accounting Standards Update No. 2022-02, Troubled Debt Restructurings and Vintage Disclosures. The standard modifies the accounting for troubled debt restructurings by creditors and modifies certain disclosure requirements. The guidance will be applied prospectively, with the exception of the recognition and measurement of troubled debt restructurings, for which we may elect to apply a modified retrospective transition method. The standard is effective for us on January 1, 2023, and we do not expect its adoption to have a significant impact on our financial position or results of operations.


NOTE 3: SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION

Trade accounts receivable Net trade accounts receivable were comprised of the following:
(in thousands)March 31,
2022
December 31,
2021
Trade accounts receivable – gross$188,534 $202,077 
Allowance for credit losses(4,199)(4,130)
Trade accounts receivable – net(1)
$184,335 $197,947 

(1) Includes unbilled receivables of $50,106 as of March 31, 2022 and $47,420 as of December 31, 2021.
6

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


Changes in the allowance for credit losses for the quarters ended March 31, 2022 and 2021 were as follows:
Quarter Ended
March 31,
(in thousands)20222021
Balance, beginning of year$4,130 $6,428 
Bad debt expense (benefit)625 (649)
Write-offs and other(556)(900)
Balance, end of period$4,199 $4,879 

Inventories and supplies – Inventories and supplies were comprised of the following:
(in thousands)March 31,
2022
December 31,
2021
Raw materials$5,587 $5,316 
Semi-finished goods6,742 6,708 
Finished goods21,555 21,995 
Supplies6,022 6,041 
Reserves for excess and obsolete items(5,379)(5,132)
Inventories and supplies, net of reserves$34,527 $34,928 

Changes in the reserves for excess and obsolete items were as follows for the quarters ended March 31, 2022 and 2021:

Quarter Ended
March 31,
(in thousands)20222021
Balance, beginning of year$5,132 $11,748 
Amounts charged to expense773 2,013 
Write-offs and other(526)(822)
Balance, end of period$5,379 $12,939 

Available-for-sale debt securities – Available-for-sale debt securities included within funds held for customers were comprised of the following:
 March 31, 2022
(in thousands)CostGross unrealized gainsGross unrealized lossesFair value
Funds held for customers:(1)
Canadian and provincial government securities
$9,865 $ $(836)$9,029 
Canadian guaranteed investment certificate3,998   3,998 
Available-for-sale debt securities$13,863 $ $(836)$13,027 

(1) Funds held for customers, as reported on the consolidated balance sheet as of March 31, 2022, also included cash of $143,725.

7

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

 December 31, 2021
(in thousands)CostGross unrealized gainsGross unrealized lossesFair value
Funds held for customers:(1)
Canadian and provincial government securities$9,724 $ $(374)$9,350 
Canadian guaranteed investment certificate3,957   3,957 
Available-for-sale debt securities$13,681 $ $(374)$13,307 
 
(1) Funds held for customers, as reported on the consolidated balance sheet as of December 31, 2021, also included cash of $241,488.

Expected maturities of available-for-sale debt securities as of March 31, 2022 were as follows:
(in thousands)Fair value
Due in one year or less$6,572 
Due in two to five years2,708 
Due in six to ten years3,747 
Available-for-sale debt securities$13,027 

Further information regarding the fair value of available-for-sale debt securities can be found in Note 8.

Revenue in excess of billings – Revenue in excess of billings was comprised of the following:
(in thousands)March 31,
2022
December 31,
2021
Conditional right to receive consideration$22,657 $22,780 
Unconditional right to receive consideration(1)
11,032 7,613 
Revenue in excess of billings$33,689 $30,393 

(1) Represents revenues that are earned but not currently billable under the related contract terms.

Intangibles – Intangibles were comprised of the following:
 March 31, 2022December 31, 2021
(in thousands)Gross carrying amountAccumulated amortizationNet carrying amountGross carrying amountAccumulated amortizationNet carrying amount
Customer lists/relationships$493,510 $(264,822)$228,688 $493,495 $(255,178)$238,317 
Internal-use software471,035 (354,338)116,697 456,133 (342,656)113,477 
Technology-based intangibles98,813 (40,584)58,229 98,813 (38,553)60,260 
Partner relationships73,257 (4,323)68,934 73,095 (2,990)70,105 
Trade names44,185 (24,935)19,250 51,052 (31,277)19,775 
Software to be sold36,900 (29,167)7,733 36,900 (28,110)8,790 
Intangibles$1,217,700 $(718,169)$499,531 $1,209,488 $(698,764)$510,724 
8

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


Amortization of intangibles was $36,159 for the quarter ended March 31, 2022 and $23,264 for the quarter ended March 31, 2021. Based on the intangibles in service as of March 31, 2022, estimated future amortization expense is as follows:
(in thousands)Estimated
amortization
expense
Remainder of 2022$88,406 
2023117,562 
202475,257 
202550,306 
202640,004 

The following intangibles were acquired during the quarter ended March 31, 2022:
(in thousands)AmountWeighted-average amortization period
(in years)
Internal-use software$15,931 3
Customer lists/relationships10,280 6
Partner relationships163 1
Acquired intangibles$26,374 4

Goodwill – Changes in goodwill by reportable segment and in total were as follows for the quarter ended March 31, 2022:
(in thousands)PaymentsCloud SolutionsPromotional SolutionsChecksTotal
Balance, December 31, 2021:
    
Goodwill, gross$895,338 $432,984 $252,874 $434,812 $2,016,008 
Accumulated impairment charges (392,168)(193,699) (585,867)
Goodwill, net of accumulated impairment charges
895,338 40,816 59,175 434,812 1,430,141 
Currency translation adjustment— — 15 — 15 
Balance, March 31, 2022
$895,338 $40,816 $59,190 $434,812 $1,430,156 
Balance, March 31, 2022:
    
Goodwill, gross$895,338 $432,984 $252,889 $434,812 $2,016,023 
Accumulated impairment charges (392,168)(193,699) (585,867)
Goodwill, net of accumulated impairment charges
$895,338 $40,816 $59,190 $434,812 $1,430,156 
9

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

Other non-current assets – Other non-current assets were comprised of the following:
(in thousands)March 31,
2022
December 31,
2021
Postretirement benefit plan asset$88,943 $87,019 
Cloud computing arrangements implementation costs66,408 63,806 
Prepaid product discounts51,885 56,527 
Deferred contract acquisition costs(1)
20,200 17,975 
Loans and notes receivable from distributors, net of allowance for credit losses(2)
15,970 20,201 
Assets held for sale(3)
10,151 7,251 
Other25,899 26,684 
Other non-current assets$279,456 $279,463 

(1) Amortization of deferred contract acquisition costs was $1,756 for the quarter ended March 31, 2022 and $972 for the quarter ended March 31, 2021.

(2) Amount includes the non-current portion of loans and notes receivable. The current portion of these receivables is included in other current assets on the consolidated balance sheets and was $1,162 as of March 31, 2022 and $1,317 as of December 31, 2021.

(3) Relates primarily to the continuing evaluation of our real estate footprint in both periods, as well as the assets of our Australian web hosting business as of March 31, 2022 (Note 6).

Changes in the allowance for credit losses related to loans and notes receivable from distributors were as follows for the quarters ended March 31, 2022 and 2021:
Quarter Ended
March 31,
(in thousands)20222021
Balance, beginning of year$2,830 $3,995 
Bad debt expense (benefit)81 (634)
Exchange for customer lists(402) 
Balance, end of period$2,509 $3,361 

Past due receivables and those on non-accrual status were not significant as of March 31, 2022 or December 31, 2021.

We categorize loans and notes receivable into risk categories based on information about the ability of borrowers to service their debt, including current financial information, historical payment experience, current economic trends and other factors. The highest quality receivables are assigned a 1-2 internal grade. Those that have a potential weakness requiring management's attention are assigned a 3-4 internal grade.
10

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


The following table presents loans and notes receivable from distributors, including the current portion, by credit quality indicator and by year of origination, as of March 31, 2022. There were no write-offs or recoveries recorded during the quarter ended March 31, 2022.
Loans and notes receivable from distributors amortized cost basis by origination year
(in thousands)2020201920182017PriorTotal
Risk rating:
1-2 internal grade$1,201 $471 $5,283 $8,942 $1,145 $17,042 
3-4 internal grade 2,599    2,599 
Loans and notes receivable
$1,201 $3,070 $5,283 $8,942 $1,145 $19,641 

Changes in prepaid product discounts during the quarters ended March 31, 2022 and 2021 were as follows:
 Quarter Ended
March 31,
(in thousands)20222021
Balance, beginning of year$56,527 $50,602 
Additions(1)
4,229 7,890 
Amortization(8,924)(7,440)
Other53 (8)
Balance, end of period$51,885 $51,044 
 (1) Prepaid product discounts are generally accrued upon contract execution. Cash payments for prepaid product discounts were $7,859 for the quarter ended March 31, 2022 and $9,590 for the quarter ended March 31, 2021.

Accrued liabilities – Accrued liabilities were comprised of the following:
(in thousands)March 31,
2022
December 31,
2021
Deferred revenue(1)
$46,908 $52,645 
Employee cash bonuses, including sales incentives16,216 45,006 
Interest15,451 4,597 
Operating lease liabilities14,243 14,852 
Customer rebates9,316 9,036 
Prepaid product discounts due within one year8,319 11,866 
Other91,460 78,830 
Accrued liabilities$201,913 $216,832 
 
(1) $20,238 of the December 31, 2021 amount was recognized as revenue during the quarter ended March 31, 2022.

Supplemental cash flow information – The reconciliation of cash, cash equivalents, restricted cash and restricted cash equivalents to the consolidated balance sheets was as follows:
(in thousands)March 31,
2022
March 31,
2021
Cash and cash equivalents$44,059 $125,440 
Restricted cash and restricted cash equivalents included in funds held for customers143,725 109,075 
Cash and cash equivalents included in other current assets(1)
400  
Non-current restricted cash included in other non-current assets2,595  
Total cash, cash equivalents, restricted cash and restricted cash equivalents$190,779 $234,515 

(1) Represents cash and cash equivalents of our Australian web hosting business that was classified as held for sale as of March 31, 2022 (Note 6).
11

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



NOTE 4: EARNINGS PER SHARE

The following table reflects the calculation of basic and diluted earnings per share. During each period, certain stock options, as noted below, were excluded from the calculation of diluted earnings per share because their effect would have been antidilutive. 
 Quarter Ended
March 31,
(in thousands, except per share amounts)20222021
Earnings per share – basic:  
Net income$9,680 $24,325 
Net income attributable to non-controlling interest(36)(33)
Net income attributable to Deluxe9,644 24,292 
Income allocated to participating securities(10)(19)
Income attributable to Deluxe available to common shareholders$9,634 $24,273 
Weighted-average shares outstanding42,803 42,046 
Earnings per share – basic$0.23 $0.58 
Earnings per share – diluted:
Net income$9,680 $24,325 
Net income attributable to non-controlling interest(36)(33)
Net income attributable to Deluxe9,644 24,292 
Income allocated to participating securities(10) 
Re-measurement of share-based awards classified as liabilities
(39) 
Income attributable to Deluxe available to common shareholders$9,595 $24,292 
Weighted-average shares outstanding42,803 42,046 
Dilutive impact of potential common shares429 458 
Weighted-average shares and potential common shares outstanding
43,232 42,504 
Earnings per share – diluted$0.22 $0.57 
Antidilutive options excluded from calculation2,063 2,423 


12

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

NOTE 5: OTHER COMPREHENSIVE INCOME

Reclassification adjustments Information regarding amounts reclassified from accumulated other comprehensive loss to net income was as follows:
Accumulated other comprehensive loss componentsAmounts reclassified from accumulated other comprehensive lossAffected line item in consolidated statements of comprehensive income
Quarter Ended
March 31,
(in thousands)20222021
Realized loss on interest rate swap
$(318)$(334)Interest expense
Tax benefit
83 87 Income tax provision
Realized loss on interest rate swap, net of tax
(235)(247)Net income
Amortization of postretirement benefit plan items:
Prior service credit355 355 Other income
Net actuarial loss(225)(407)Other income
Total amortization130 (52)Other income
Tax expense(77)(31)Income tax provision
Amortization of postretirement benefit plan items, net of tax53 (83)Net income
Total reclassifications, net of tax$(182)$(330)

Accumulated other comprehensive loss Changes in the components of accumulated other comprehensive loss during the quarter ended March 31, 2022 were as follows:
(in thousands)Postretirement benefit plans
Net unrealized loss on available-for-sale debt securities(1)
Net unrealized loss on cash flow hedge(2)
Currency translation adjustmentAccumulated other comprehensive loss
Balance, December 31, 2021
$(15,431)$(344)$(2,261)$(13,456)$(31,492)
Other comprehensive (loss) income before reclassifications
 (335)1,924 696 2,285 
Amounts reclassified from accumulated other comprehensive loss
(53) 235  182 
Net current-period other comprehensive (loss) income
(53)(335)2,159 696 2,467 
Balance, March 31, 2022
$(15,484)$(679)$(102)$(12,760)$(29,025)

(1) Other comprehensive loss before reclassifications is net of an income tax benefit of $116.

(2) Other comprehensive income before reclassifications is net of income tax expense of $679.


13

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

NOTE 6: ACQUISITION AND DIVESTITURE

Acquisition On June 1, 2021, we acquired all of the equity of First American Payment Systems, L.P. (First American). Further information regarding this acquisition, including the preliminary allocation of the purchase price, can be found under the caption "Note 6: Acquisitions" in the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K. We expect to finalize the purchase price allocation in the second quarter of 2022, when we complete the tax returns for the pre-acquisition period.

Our results of operations for the quarter ended March 31, 2022 included revenue of $83,284 and net loss of $510 from the operations of First American, including restructuring and integration costs of $2,222 related primarily to real estate rationalization. Our results of operations for the quarter ended March 31, 2021 included related acquisition transaction costs of $2,765, which are included in selling, general and administrative expense in the consolidated statement of comprehensive income.

Revised pro forma financial information During the first quarter of 2022, we identified errors in the previously reported pro forma results of operations related to the First American acquisition. These errors related to the amount of historical First American revenue and net income (loss) included for the pre-acquisition periods, as well as errors in the adjustments related to the amortization of acquired intangibles, interest expense on the acquisition financing and transaction costs.

For the quarter and six months ended June 30, 2021 and the nine months ended September 30, 2021, these corrections decreased pro forma revenue by $27,595 from the amounts previously reported. For the years ended December 31, 2021 and 2020, these corrections decreased pro forma revenue by $26,335 and $3,027, respectively, from the amounts previously reported. The corrections adjusted pro forma net income (loss) attributable to Deluxe as follows from the amounts previously reported:
(in thousands)Increase in pro forma net income (loss) attributable to Deluxe
Quarter ended June 30, 2021$7,636 
Six Months ended June 30, 20215,911 
Quarter ended September 30, 20212,231 
Nine Months ended September 30, 20218,142 
Year Ended December 31, 202110,138 
Year Ended December 31, 2020(9,082)

The following unaudited pro forma financial information summarizes our consolidated results of operations as though the acquisition occurred on January 1, 2020:

As Revised
(in thousands)Quarter Ended
March 31, 2021
Quarter Ended
June 30, 2021
Six Months Ended
June 30, 2021
Quarter Ended
Sept. 30, 2021(1)
Nine Months Ended
Sept. 30, 2021
Year Ended December 31, 2021Year Ended December 31, 2020
Revenue$518,104 $535,493 $1,053,597 $532,141 $1,585,738 $2,156,313 $2,079,103 
Net income (loss) attributable to Deluxe19,044 24,579 43,623 14,695 58,318 74,843 (54,489)

(1) Only net income attributable to Deluxe was revised for the quarter ended September 30, 2021.

The unaudited pro forma financial information