Deluxe Corporation (DLX) Q1 2019 Earnings Report, Transcript and Summary

Ladies and gentlemen, thank you for standing by, and welcome to the First Quarter 2019 Deluxe Corporation Earnings Conference Call. [Operator Instructions]. As a reminder, today's program is being recorded. And now I would like to introduce your host for today's program, Ed Merritt, Treasurer and Vice President of Investor Relations. Please go ahead, sir.

Thank you, Jonathan, and welcome, everyone, to Deluxe Corporation's First Quarter 2019 Earnings Call. I'm Ed Merritt, Treasurer and Vice President of Investor Relations. Joining me on today's call is Barry McCarthy, our President and Chief Executive Officer; and Keith Bush, our Chief Financial Officer. At the end of today's prepared remarks, Barry, Keith and I will take questions. I'd like to remind you that comments made today regarding financial estimates, projections and management's intentions and expectations regarding the company's strategy and future performance are forward-looking in nature as defined in the Private Securities Litigation Reform Act of 1995. These comments are subject to risks and uncertainties, which could cause actual results to differ materially from those projected. Additional information about factors that could cause actual results to differ from the projections are contained in the press release that we issued this morning as well as in the company's Form 10-K for the year ended December 31, 2018. Portions of the financial and statistical information that will be reviewed during this call are addressed in more detail in today's press release, which is posted on our Investor Relations website at deluxe.com. This information was also furnished to the SEC on Form 8-K filed by the company this morning. Any references to non-GAAP financial measures are reconciled to the comparable GAAP financial measures in the press release or as part of our presentation during this call. Now I'll turn the call over to Barry.

Thanks, Ed, and good morning, everyone. We have an extraordinary amount of content to cover today. We're going to recap our first quarter results, provide an update on our focus areas since the last call, introduce some enhanced financial metrics, provide our financial outlook for the remainder of the year and update you on our strategy for the new Deluxe to become a trusted tech-enabled solutions company. This is all consistent with my commitment to provide transparency on our transformation. Not all of our calls will be this long, with this much content. Let's get started with the first quarter results. We had a good start to the year, and I'm pleased to report that we delivered $499 million of revenue in the quarter, squarely within the range we expected. Total first quarter revenue grew 1.5% year-over-year. We delivered diluted earnings per share of $0.93 and revised adjusted diluted earnings per share of $1.54, at the top end of our range after excluding the additional non-GAAP items, which will be discussed later. All segments performed at the levels we expected. Before I get into the details on our strategy and progress, let me turn the call over to Keith for some additional color on the quarter.

Thanks, Barry. We delivered first quarter revenue of $499 million, which represents a 1.5% increase over last year. Organic revenue, which excludes acquisitions, FX and other noncomparable items, declined about 2.7%. Shifting to our current business segments. Small business services revenue was $313.1 million and declined about 1% in total or about 1.9% organically. Financial services revenue was $154.4 million and grew nearly 10% in total, but declined about 2.7% organically. Direct Checks revenue was $31.6 million and declined 9.7% year-over-year, slightly better than our expectations. Barry will outline our strategy framework to become a trusted, tech-enabled solutions company in a few minutes, which will lead to a realignment of our business later in the year. But for now, I want to provide revenue by product category, which conforms to what we have provided in the past. Our largest group of products and services is marketing solutions and other services, or MOS, which delivered revenue of over $214 million, ending at 43% of total revenue. Check revenue ended the quarter at $201 million, representing about 40% of total revenue. And forms and accessories delivered $83.5 million, representing about 17% of total revenue. SG&A expense increased approximately 300 basis points from last year. About 150 basis points of the increase resulted from gains on asset sales in last year's results, and about 110 basis points of the increase resulted from CEO transition costs this year. The remaining expense increase was related to acquisition and other expenses, only partially offset by efficiency and cost savings. Adjusted diluted EPS and adjusted EBITDA, which we will discuss shortly, normalized the impact of these charges, which we believe provides additional helpful metrics you can use to analyze our results. Diluted earnings per share for the first quarter was $0.93 and includes aggregate, non-GAAP adjustments of $0.61 per share. Moving on to adjusted diluted EPS. As a result of input from many of you, we have slightly modified our calculation of adjusted diluted earnings per share to exclude additional items that we believe are not representative of our core operations. Adjusted diluted EPS will now exclude acquisition-related amortization, stock-based compensation expense, certain legal related expenses and gains or losses on asset sales. A complete reconciliation from diluted EPS to adjusted diluted EPS is included in our earnings release. Excluding $0.61 of non-GAAP adjustments, adjusted diluted EPS for the first quarter was $1.54 per share compared to $1.60 per share in the first quarter of 2018. We've applied the same non-GAAP adjustments to adjusted EBITDA. We believe adjusted EBITDA provides transparency into our operations and is useful in evaluating our operating performance compared to other companies. Importantly, the use of adjusted EBITDA is consistent with how technology companies manage their businesses and how we will manage our company moving forward, as we move towards becoming a trusted tech-enabled solutions company. A reconciliation of adjusted EBITDA is included in our earnings release. Adjusted EBITDA for the first quarter was $113.7 million compared to $121.6 million in the first quarter of 2018. The change in adjusted EBITDA is the result of higher SG&A discussed earlier and the greater mix of service revenue resulting from acquisitions. In addition, we continued to see the impact of commission structures entered into in 2018. We are also experiencing some inflationary pressure in materials and shipping costs and increased medical expenses that have not fully been offset by cost-saving activity. Now moving on to the balance sheet and cash flow statement. As previously reported on January 22, 2019, we expanded our credit facility by $200 million, with total availability now at $1.15 billion. At the end of the quarter, we were drawn $946 million on the credit facility, with the increase from the beginning of the year primarily due to $50 million of common stock repurchases in the first quarter. Moving to free cash flow, which is defined as cash provided by operating activities minus capital expenditures. Cash provided by operating activities was $45.4 million and capital expenditures were $14.6 million, resulting in free cash flow of $30.8 million. Free cash flow this year included outflows of over $12 million for payments toward a legal matter and over $5 million of prepaid product discounts. To the extent we generate excess cash, we plan to reduce the amount outstanding against our credit facility. I know we've thrown a lot at you already. Before moving to our 2019 and full year outlook, I want to note we are affirming our previous 2019 revenue and EPS outlook. We expect second quarter revenue to be in the range of $490 million to $505 million. We expect adjusted diluted EPS to be in the range of $1.55 to $1.65 per share. For the full year, we expect revenue to be between $2 billion and 2.5 - $2.05 billion, which is in line with our previous outlook for a low single-digit increase over 2018. We expect adjusted diluted EPS in the range of $6.65 per share to $6.95 per share. On our last earnings call, our outlook called for a slight improvement in full year adjusted diluted EPS before incremental investments needed to accelerate our transformation. To reiterate, our current outlook is consistent with the previous outlook. To help reconcile the two, our current outlook of $6.65 to $6.95 per share includes approximately $5 million or $0.09 per share of incremental investment spend as well as the impact of the new non-GAAP adjustments, which were not included in the previous outlook. Additionally, we expect to incrementally invest between $30 million and $60 million in each of the next two years to build out our technology platforms. These will likely be a combination of capital and expense items, and support our IT integration and business transformation related to sales, finance and human resources. These investments are still being scoped and quantified and are not in our current adjusted diluted EPS outlook. We believe we have structural savings that will largely self-fund our future investments. However, due to the speed at which we intend to integrate our systems and technology to drive our transformation, we expect timing differences will impact our ability to fully self-fund through efficiency savings alone. As we noted on our last earnings call, we will continue our acquisition pause throughout the first half of the year. This will allow us time to complete the integration of previous acquisitions and ensure we have a foundation for future acquisitions. To be clear, acquisitions will be an important element of our growth, and we expect smart acquisitions will augment our strategy when appropriate going forward. Now I'll turn the call back to Barry.

Thanks, Keith. I've now been the CEO of Deluxe for almost five months, and we've made substantial progress reviewing our strategy and operations during that time. Before I outline our future strategy, I want to provide a brief update on the four new day areas of focus I discussed on our last earnings call. First, sales. We've launched a national search for an enterprise chief revenue officer and hope to give you an update on that search soon. We believe we have significant opportunity to sell more to our existing customers; they value our relationship and would deepen that relationship if they know more about our extensive offerings. Accordingly, we're in the final stages of selecting a new enterprise-wide CRM tool and expect to begin the initial scoping very soon. We're confident having a single view of our customer will be critical to unlocking our potential. Second, products and innovation. We've added a new role and hired a Vice President of Strategy and Planning, Amanda Parrilli, who has joined us from Home Depot. Earlier in her career, she had executive roles at Citi and First Data. Amanda has been in her role for about eight weeks and is off to a great start. We've also begun to build out enterprise innovation and product development teams, with processes to ensure we are all well-positioned to translate the insights we gain from customers into tangible, innovative products and services that address their needs. Third, efficiency. Our teams have identified millions of dollars of savings from a structural redesign of our systems architecture, a rationalization of our real estate footprint and many other items. I won't provide specifics in this area yet, but we have identified the areas where we need to become more efficient and are taking action to realize these savings. We'll be hearing more details on this as we progress through the year. And the fourth area of initial focus was culture. We've hired a new Chief Human Resources Officer, Jane Elliott, who most recently was the CHRO at Global Payments. We're glad to have Jane on board to guide our HR activities and help shape our culture. We've initiated a process of education and communication to ensure that every employee understands the importance of our customers and the shareholders. And we've made substantial progress breaking down our internal silos. Our end goal is to develop a culture to fully transform the company from its check printing and manufacturing legacy into a trusted technology-enabled solutions provider. During our last earnings call, I told you we had engaged one of the world's foremost management consulting firms to help us assess our current business and strategic direction. We have now completed the first phase of that review. Our strategic assessment validated what we consider our core competencies and key assets. For example, over the past 10-plus years, Deluxe has done a great job acquiring companies to diversify revenue beyond printed checks and forms. The collection of these assets provides us a great foundation, upon which we will transform into a trusted tech-enabled solutions company. Let me summarize our key competencies and assets. First, we have a fantastic base of existing customers and partners. We're a leading provider of solutions to nearly 5 million small businesses and 4,600 financial institutions. We host more than 4 million websites for small businesses directly and through partners and serve 180 of the top 200 financial institutions. Next, we're a proven, trusted partner in the markets where we operate and are one of the few organizations that leading financial institutions trust with sensitive, personally identifiable information, also referred to as PII. Third, we have a highly respected brand which we can leverage. As I said earlier, our customers want to do more business with us and consolidate spending with fewer, more strategic partners. Fourth, we're a cost-efficient service provider. We produce solutions at massive scale with great security and reliability at low cost with continuous improvement. For perspective on our scale, we ship over 100,000 secure packages every day. Fifth, we have an extensive catalog of products and services that creates a unique advantage when compared to less diversified competitors, and we have an extremely dedicated workforce eager to win. Finally, this is supported by solid financial structure with low leverage and high cash flow. Deluxe has a great foundation of competencies and assets. The primary strategic questions are: how will we leverage these assets and core competencies to become more than a diversified company of companies? And what needs to be done to transform into a trusted tech-enabled solutions provider? I want to be clear. Our next chapter goes much deeper than what the company's revenue diversification has achieved to date. Instead of relying exclusively on acquisitions to deliver growth, we will now focus, first, on accelerating revenue growth organically. Then, we will supplement with selective strategic acquisitions. This is a significant difference that will require us to fundamentally change our go-to-market strategy, operating model and organization design. Fully integrating past acquisitions and consolidating and standardizing technology platforms will enable us to operate as one Deluxe and sell all of our products and services to any customer. So where is the new Deluxe headed? We intend to focus on growth businesses with the following characteristics: one, recurring revenue stream; two, scalable business models; three, attractive cost structures; four, data-rich; and five, strong PE multiple. And while we'll continue to sell to enterprise, small business and financial services customers, our business will not be segmented by customer type in the future. Instead, we will focus our efforts on four primary business areas: one, payments; two, cloud; three, promotional products; and four, checks. Our intent in late 2019 is to realign, manage and report our business in these four areas. We expect to reinvest our stream of reliable cash flow from promotional products and checks into our two primary growth areas, payments and cloud. During our transition period, we will implement our strategy, while delivering our annual plan, and importantly, paying our dividend. We believe just modest success in our new strategy will provide for an incremental $300 million of profitable, new net revenue in 2023 after offsetting future expected check declines. This specifically excludes any M&A. We expect this strategy to deliver sustained mid-single-digit organic revenue growth with adjusted EBITDA margins in the low to mid-20% range. While we don't have enough time on this call to get deep into the strategy, I know you have questions, and I'll provide a little insight into why these markets. The first growth area, payments, is a multibillion-dollar market growing at 10% to 15% annually with healthy margins and high PE multiples. Deluxe was founded as a payment company, and many of our customers continue to think of us as a payment company. We believe we can leverage existing competencies, including our extensive distribution channels in this space. Clearly, payments is a large and very diverse market, and we don't plan to compete everywhere. We intend to narrow our focus to areas where we have confidence in our ability to win. For example, integrated receivables, where we can leverage our treasury management solutions. Card-based payments and fraud control, where we can leverage our reach with SMBs; payroll and disbursements and e-payments can be sold across a broad base of customers. The second growth area is cloud-based solutions, which includes data services. This too is a multibillion-dollar market, growing at double digits annually with healthy margins and high PE multiples. No, we are not expanding into cloud storage or cloud distributed computing. We will focus narrowly on the cloud areas where we have the right to win. For example, Deluxe already has a leadership position in data services and data-driven marketing solutions, with FMCG, Datamyx and DMS. Additionally, we have strong assets in website design and hosting for small businesses, where we already host over 1 million small business sites directly and over 3 million sites through resellers. We have strong offerings in both, do it for me, DIFM, and do it for yourself, DIY, logo design. And we offer a host of loyalty solutions, digital profitability, management dashboard and management of bank account switching tools. And the third area, promotional products. We'll focus our efforts on profitability and cash flow. Product services in this area include print, retail packaging, banners, business forms and other promotional products, designed to help customers manage and promote their brands. We believe there are untapped opportunities to leverage promotional products to help drive revenue growth in our other businesses as well. The fourth area is checks. This area already generates strong margins and cash flow. Here, we will manage profitability by making smart investments to maintain our business and capture new market share, where possible. Our customer base in checks provides us with unique, trusted access to both small businesses and financial institutions that we believe is unmatched in the marketplace. Execution of this strategy will obviously require significant change throughout our organization. We're actively building project plans to advance the process. We've established a transformation leadership officer, or TLO, and we're supplementing our existing team's knowledge and expertise with external resources, as necessary, to help us through the transition. We intend to provide updates on future earnings calls. We will now go to market as One Deluxe. You've heard me say, Deluxe was a company of companies. In the future, we'll approach the market as a company of products. This is a significant change that will allow us to sell all of our products to all of our customers. This new go-to market strategy will be led by a world-class chief revenue officer to be announced soon. As Keith mentioned, acquisitions will be a strategic element of our growth plan. Going forward, you should expect to see us make fewer, more meaningful acquisitions in our strategic growth markets. New for Deluxe, we expect to augment growth through strategic alliances and through partnering with third parties that have capabilities or competencies that we can leverage quickly. This is a significant departure from the past and will allow us to progress faster with much greater capacity than before, allowing us to leverage the partner's capital and investment. We will also invest in our infrastructure. As Keith mentioned, we expect to incrementally invest between $30 million and $60 million in each of the next two years to build out our technology platforms. This includes investment in sales technologies that will enable a single view of our customer and provide greater cross-sell opportunities. Additionally, we'll invest in our human capital management and financial management systems to enable integration of duplicative and aging collaboration tools and platforms. These enhancements should deliver productivity gains and substantial cost savings. Strategically, these infrastructure upgrades will also make it easier for us to engage in M&A and quickly integrate future acquisitions. We've already begun to transform our enterprise-wide culture. We're on a pathway to be less like a manufacturing company and more like a technology company by focusing on customer needs and developing solutions to address those needs quickly. No, we don't aspire to become a Silicon Valley company, but we will be laser-focused on deeply understanding the markets and customers we serve, strengthening our alignment with customers, employees and shareholders. Technology companies are responsive, deliver rapid prototypes, constantly test new ideas and are nimble in their execution. That's where we want to go. Like technology companies, we need each employee to think and act like a shareholder, with a shared goal of stock price appreciation. As a result, effective April 1, we took a very bold step and announced every North American employee have received restricted stock unit grants in Deluxe, making them all shareholders. Additionally, our senior leaders will earn a higher portion of their annual compensation in stock with less reliance upon cash compensation. Every employee now has the same goal as shareholders, stock price appreciation. Last week, the executive leadership team completed a roadshow at our major sites to congratulate and share with our employees how they could impact our business as new owners of Deluxe. The reception has been outstanding. We're already seeing the green shoots of ownership culture emerging, and I'm confident this ownership mindset will have a transformational impact on our culture. I know we covered a lot of ground today, and some of you may have more questions about our strategy. I'm pleased to share that we plan to host an Investor Day in the second half of the year. At that time, we'll provide more details on the strategy, how we intend to realign, manage and report the business in the future, and we will provide you with an opportunity to meet our key leaders. We will send out a save-the-date notice soon. In closing, we have a tremendous opportunity to fundamentally transform our company to accelerate growth, and we look forward to updating you on the progress of our transformation in the coming months. Now Keith, Ed and I will open the call for questions.

[Operator Instructions]. Our first question comes from the line of Jamie Clement from Buckingham Research.

Barry, congratulations on providing just as much content as Lee used to provide. Yes. So one thing you mentioned, and I'm curious about this. Because, obviously, in the general scheme of things, you're not a gigantic company. And as you think about partnerships and alliances versus M&A, what do you think the partner on the other side of the table, based on what you've seen so far in your tenure at Deluxe, what do you think they value most about Deluxe in a partnership?

Jamie, I started the conversation talking about our core competencies and our key assets, and we truly have unmatched distribution with 5 million small businesses and 4,800 financial institutions that we can reach and that we talk to every year. So I think our partners, and potential partners, will highly value our ability to reach into that market segment in a very efficient way. I also said we are a trusted brand. We truly are a trusted brand. There are very few organizations on the planet that gets - that have PII data, that banks share in order to run a business. We're one of those. And so our trusted brand, our incredible reach to reach small businesses, enterprises and financial institutions, we think is a very compelling opportunity for any partner that wants to get to those markets.

Okay. Okay, and if I could just - if I could just transfer over to kind of - to guidance and the enhanced metrics and those kinds of things. I think there's a fair amount of confusion this morning. And it always happens when companies changing things up. I had thought that like what you guys said, so basing on the 2018 adjusted EPS number, which when originally reported, so before the legal charge, was I think $5.69? And then there was about 1/4, about $0.25 on the asset sales to knock out of that? Am I on the right track, Keith?

So the way we're looking at that is the original $5.56, after taking into account all of these adjustments, is $6.88.

See, that's where I'm - that's - I'm looking at it the other way, and I think this is why we're a little confused. So like the reported number for 2018 was, I think, $5.69. So less $0.25, that's $5.44. And I thought like - I think - I thought like your preliminary guidance - and obviously preliminary, we didn't take it as like rock solid, full-on guidance, because there was a lot of work to be done, but that you all thought you'd grow off of that number. If I knock out like what looks like your assumption for stock comp and for intangible amortization from your new guidance framework, it looks like the midpoint of that range is like $5.20. Is that right? So in other words, what I'm saying is it sounded like initially you all thought you could grow slightly off of a $5.40-something number. And now the number is lower, and I'm just curious, like I didn't know if that was increased investment spending? That part of this is maybe some of the $30 million to $60 million that you've already identified? I just - there just seems to be some confusion this morning.

Jamie, I think the other piece to factor in here is before the additional investments that we're...

Yes, that's what I was asking. Yes, exactly. That's what I'm asking.

Right. So we've got - we included about $5 million of additional investments in our current guidance that was not there previously. So we've guided before. Now our guidance includes it. So that really explains that differential.

And then so - but going forward, then we should potentially focus on the $30 million to $60 million, some of which may be capitalized, some of which may be expensed in addition to this, right? Is that what - how you're framing this?

That's how we're framing it.

Our next question comes from the line of Charlie Strauzer from CJS Securities.

Just to kind of takeoff where Jamie was left off there and just to further clarify. So the $5 million incremental, I think you said it was a $0.09 hit versus the prior guidance. Is that the way to think about it?

So the way I'm - the way we're thinking about is it translates in our current guidance, is $0.09. So that $5 million is about $0.09.

Right. So an apples-to-apples basis you take the $0.09 back out of there. And then the $30 million to $60 million you're taking about in incremental investments in each of the next two years, is it $30 million to $60 million each year? Or $30 million to $60 million total over the next two years?

Yes. The way to think about that is each year. And that spend has not yet initiated. So we are in the process of evaluating how - what form that will take in terms of either capital or expense and how that will roll through our cash flow and our financials. But that spend has not yet initiated.

So should we factor that into our models as we plan out the new kind of way to think about the EPS range. So the EPS range of $6.65, $6.95, does not include that. But should we start to think about that in our numbers?

That is - when you're thinking about that, think about that over the next 8 quarters or the next 24 months. So that is going to - that's an elongated tail there. The other thing I would just, I think, to be aware of is many of these investments are investments in core systems that at some point we needed to make those investments. What we're doing is accelerating the timing of those investments and bringing them online in a rational way.

And is that why - I think we see the CapEx is up $15 million year-over-year to $75 million from $60 million, is that the way to think about that as well?

Correct.

And that's basically baked into this $30 million to $60 million of incremental, is that correct as well?

So the capital investments that are currently in our outlook are before giving effect for this additional incremental investments.

Got it. So that's on top of the CapEx guidance you've already given?

Yes, correct. What we will do is we will maintain a disciplined process as we have historically done in thinking about how we invest cash back into our business. So we will take a look at all of the planned investments that are in our current outlook and we'll prioritize that against our future expected - expectations, so that we're putting the right investments in and in the right sequence. And so there's the potential that a portion of that will be funded through remainder of year capital.

Understood. And then just how should we think about too on the share repurchases in the EPS guidance? Is that - are you expecting more share repurchases? And kind what's the rough sense of the share count we should be using?

Yes. This is Ed, Charlie. We typically don't provide any EPS - or any outlook on share repurchases. We bought quite a few shares last year. We did buy $50 million in the first quarter. We'll continue to monitor that, but we just don't typically provide any kind of a projection on when we will and will not be in the market for share repurchases.

We have time for one last question, and the question comes from Chris McGinnis from Sidoti & Company.

I guess, just one question around the - your talk around acquisitions. Obviously, it's paused now. It sounded like maybe in the earlier comments that maybe that would open back up in the second half of the year. But given kind of the talk around the strategy, it seems like that would be better made for maybe next year, or even later out. Can you just maybe tighten that up a little bit of the acquisition strategy and with the - with kind of the new focus around the new Deluxe?

Absolutely. So we signaled at the Q4 earnings of the first half of this year and reiterating that now. We will not be making any acquisitions in the first half of the year. So it allows us not only to do the work we've shared with you, but finish this thing up on some of the things that we are already working on from an integration perspective. We are signaling to you that we are open to acquisitions again in the back half of this year and going into the future. I think the most important thing to think about there is we'll be very focused in the two areas that we are calling out for our growth, which are payments and cloud. We think both of those leverage our competencies and assets very well and give us additional growth opportunity in markets with good PEs, high growth potential, et cetera.

Thank you. This does conclude the question-and-answer session of today's program. I'd like to hand the program back to Barry McCarthy for any further remarks.

Well, thank you all for your participation and questions today. In summary, Deluxe has a strong foundation of core competencies and assets we can leverage to accelerate organic growth. We plan to leverage these assets and compete in four primary areas: payments, cloud, promotional products and checks. We'll invest the reliable cash flow from promotional products and checks into payments and cloud, that are attractive growth markets where we have the ability to win. We'll fundamentally change our go-to-market - how we go to market and operate our business, resulting in one company of products that approaches the market as One Deluxe. We'll continue to be responsible stewards of shareholder assets, committed to simultaneously delivering ongoing efficiency savings and organic revenue growth while paying our dividend. And finally, we'll provide status updates on our progress throughout our transformation as we become a trusted tech-enabled solutions provider. In closing, I'd like to acknowledge my fellow Deluxers, who give their all every day to deliver for our customers and all of our shareholders. I'm grateful for their commitment and confident that now as shareholders, my fellow Deluxers will unlock our incredible transformation potential to become a trusted tech-enabled solutions provider. Now I'll turn the call back to Ed for some final comments.

Thanks, Barry. Before we conclude today's call, I would just like to mention that Deluxe management will be participating at the following conferences in the second quarter. On May 21 and 22, we'll be in New York at the Needham Emerging Technology Conference. And on June 5th and 6th, we will be in New York at the RW Baird 2019 Global Consumer Technology and Services Conference. Thanks for joining us, and that concludes the Deluxe First Quarter 2019 Earnings Call.

Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.