Shares of Deluxe Corp. fell 26 percent Thursday after the Shoreview printer of checks and business forms said its second-quarter net income fell 9 percent, lowered its full-year target and projected third-quarter results below analysts' expectations.
Shares slumped $5.05 to $14.30, a two-year low. The stock has lost half its value this year.
The company now sees 2008 earnings of $2.52 to $2.62 a share on revenue of $1.52 billion to $1.54 billion. The company cut the high end of its outlook in April and projected profits of $3.00 to $3.15 a share at the time, on revenue of $1.56 billion to $1.59 billion.
For the third quarter, Deluxe expects earnings of 56 to 60 cents a share and revenue of $367 million to $374 million. Analysts polled by Thomson Reuters were anticipating earnings of 79 cents a share and revenue of $390 million.
Meanwhile, Deluxe posted second-quarter net income of $32.6 million, or 63 cents a share, down from $36 million, or 69 cents, a year earlier. Revenue fell 8 percent to $367.7 million. The company in April projected earnings of 60 cents to 64 cents and revenue of $374 million to $384 million.
Gross margins fell to 62 percent from 64.3 percent as reductions in manufacturing costs were more than offset by the lower revenue per order in Deluxe's financial services business and higher delivery costs mostly from fuel surcharges.
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