Item 2.02 Results of Operations and Financial Condition.
Effective January 1, 2020, Deluxe Corporation (the "Company") reorganized its reportable business segments to align with structural and management reporting changes in support of its growth strategy. Under this revised reporting structure, beginning with the filing of the Quarterly Report on Form 10-Q for the quarter ending March 31, 2020, the Company will present four reportable segments, as follows:
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Payments – This segment includes the Company's treasury management solutions, including remittance and lockbox processing, remote deposit capture, receivables management, payment processing and paperless treasury management, in addition to payroll and disbursement services, including ePayments and fraud and security services.
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Cloud Solutions – This segment includes web hosting and design services, data-driven marketing solutions and hosted solutions, including digital engagement, logo design, financial institution profitability reporting and account switching tools, and business incorporation services.
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Promotional Solutions – This segment includes business forms, accessories, advertising specialties, promotional apparel, retail packaging and strategic sourcing services.
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•Checks – This segment includes printed personal and business checks.
In conjunction with the above realignment, the Company will begin presenting corporate operations, consisting of those costs that are not directly attributable to a business segment. Such costs will consist primarily of marketing, accounting, information technology, facilities, executive management, legal, tax and treasury costs that support the corporate function. Corporate operations will also include other income.
Under the new segment structure, the Company's chief operating decision maker (i.e., the Chief Executive Officer) will review earnings before interest, taxes, depreciation and amortization (EBITDA) on an adjusted basis for each segment when deciding how to allocate resources and to assess segment operating performance. Adjusted EBITDA for each segment will exclude depreciation and amortization expense, interest expense, income tax expense and certain other amounts, which may include, from time to time: asset impairment charges; restructuring, integration and other costs; CEO transition costs; share-based compensation expense; acquisition transaction costs; certain legal-related expense; gains or losses on sales of businesses and customer lists; and gains or losses on debt retirements.
This Current Report includes unaudited, recast financial information relative to business segment revenue and adjusted EBITDA for the year ended December 31, 2019, as included in the materials furnished hereunder as Exhibits 99.1 and 99.2. The Company did not operate under the new segment structure during 2019.
The recasting of previously issued financial information does not represent a restatement of previously issued financial statements and does not affect the Company's reported net income, earnings per share, total assets or shareholders' equity for any of the previously reported periods, nor does it reflect any subsequent information or event, other than as required to reflect the segment reorganization described above.
The information in this Item 2.02 shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference into any filings under the Securities Act of 1933, as amended.