Q4 2020 Deluxe Corp Earnings Call
Ladies and gentlemen, thank you for standing by and welcome to the deluxe fourth quarter and full year 'twenty and 'twenty earnings Conference call. At this time all participants are in a listen only mode. After the speaker presentation. There will be a question and answer session to ask a question. During the session you will need to press star one on.
On your telephone please be advised that today's conference is being recorded if you require any further assistance. Please press star zero and now I would like to turn the conference over to your host Chief Communications and HR Officer Jane Elliott. Please go ahead.
Yeah.
Okay.
Okay.
Okay.
Thank you and welcome to the deluxe fourth quarter and full year, 'twenty and 'twenty earnings call.
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, we will take question.
Before we begin I'd like to remind everyone that comments made today during regarding management's intentions projections financial estimates or expectations for that the company's future strategy or performance are forward looking and nature.
And as defined in the private Securities Litigation Reform Act of 1995.
These comments are subject to risks and uncertainties, including risks related to COVID-19, which could cause our actual results to differ materially from our projections.
And on information about factors that may cause our actual results to differ from projections is contained in our press release issued today and filed with the SEC on form 8-K, and the company's form 10-K for the year ended December 31, 2019, and and other company SEC filings on.
On the call today, we will discuss non-GAAP financial measures, including adjusted EBITDA and free cash flow.
And our press release and our filings with the SEC you will find additional disclosures regarding the non-GAAP measures, including reconciliations of these measures to the most comparable measures under U S. GAAP now I'll turn it over to Barry.
Thanks, Jane and good afternoon, everyone.
I'm proud of the performance, we delivered in 2020, particularly and the life of the unprecedented challenges we faced due to COVID-19.
Under the leadership of our newly expanded management team.
Which had been in place just 75 days before the pandemic took hold.
We made significant progress on our historic transformation.
Executing on our strategy and operating and for new segment.
We further optimized our portfolio completing targeted divestitures and exit during the past year.
We also ended 2020 with the lowest net debt and two and a half years and.
And paid a regular quarterly dividend demonstrating our disciplined stewardship and.
And financial strength.
Although I'm proud of how well our team has executed.
The impact of COVID-19 on our financial performance was clear.
We reported revenue of $1 $79 billion for the full year 'twenty and 'twenty.
Decline of 11% compared to 2019.
You'll note that our Q1 earnings call, we had forecast a 20% adjusted EBITDA margins for the full year 2020.
Fast forward and nine months later on.
I'm very pleased to report that we achieved this goal delivering adjusted EBITDA margin of 24% for the full year, despite the macroeconomic impact from Covid.
Importantly, COVID-19 did not change our focus for strategy.
And one thing has become increasingly clear.
Our company's diverse portfolio and business model are highly durable.
We have the right strategy right segments, and white team to weather any major macroeconomic storm.
We're a sales driven company now we continue to invest our strong cash flow from trucks and promotional solutions to grow payment and cloud solutions and each of which is well positioned and secular growth markets.
Now I would like to take a moment.
To review the for core pillars of our strategy.
First sales.
Phil.
Continue to unify our go to market sales approach in order to drive growth.
Selling more of what we have some new and existing customers.
Breaking our previous dependence on acquisition only growth.
But also resulted and escalating debt.
Second.
Payments and cloud.
We focus on these secular growth businesses.
Well, what we have built new products and migrate to a recurring revenue model.
Third.
Promotional solutions profitability.
Adjusted revenue mix and distribution channel moving total recurring revenue model.
Force.
Our check business gained market share.
Capture the share while holding margins flat.
Making smart investments, giving a strong net cash flow to invest and payments and cloud.
The strength of this strategy and our significant progress on our transformation is compelling.
And it's on Deniable, despite COVID-19 impact.
Let me explain.
And 2019, we promise to become a sales driven company.
And that's exactly what we did.
We estimate deluxe delivered full year sales driven growth in 'twenty and 'twenty for the first time and more than a decade.
Excluding COVID-19 impacts of course.
We achieved this result by building and employee ownership and sales culture.
Fundamentally changing our go to market approach.
Instead of having dozens of separate sales organizations, calling on a customer selling one product at a time.
We built a unified sales team with a complete view of our customer's relationship with us.
Complementing. These efforts, we are proud and experts ready to help close the sale.
This integrated go to market strategy is a key part of our one deluxe strategy.
And this strategy is working.
In 'twenty and 'twenty, we signed more than 3900 deal.
We added many new logos and expanded many of our existing relationships.
In fact.
Since we began one deluxe we sold six of the top 10 deals of the last decade, and clothing for largest sale and the company's history.
Here's just a flavor of our wins and 2000 and twice.
For was that they.
And they signed a multiyear deal and our truck business.
Suntrust has been a longtime customer of deluxe, but.
And what the merger of Suntrust and BB&T, we're pleased to have been selected as the trusted partner for the new combined entity.
This deal is the single largest total contract value and the company's history.
We further group Mark check market share with additional strategic takeaways.
What day to national or Super regional banks and more.
Our checks retention rate is the highest in five years.
So nova expanded its relationship with us.
Include our entire receivables as a service platform.
Being selected by Synovus Treasury management to be their digital transformation partner, yes.
Yes clear evidence.
Our integrated receivables as a service platform is what the market demand.
Payments further added or expanded relationships with PNC and Sirius XM radio.
We also expanded our relationship with alliance data and Citibank.
Elias Nader joined our receivables management solutions, and Citibank joined our deluxe payment exchange.
Promotional solutions also built on our key relationship.
As you know from previous calls.
For our customer a sales force that importantly, now salesforce is a customer of deluxe.
Sales force can now utilize our digital deluxe brand on our platform to manage their digital assets promotional products marketing collateral and collateral and other a central supply.
With our growing relationship with Salesforce and other opportunities and our pipeline, we're well positioned to expand our sales efforts and the technology industry in 'twenty and 'twenty, one and beyond.
And our color sales centers, we've delivered record average order value growing 7.5% over last year.
And our sales team signed more than 200 cross sell deals totaling $35 million and total contract value.
Cross sell has been and elusive goal for this company for more than a decade, and we delivered in 'twenty and 'twenty.
Of course, all of these wins are schedule to on board in 'twenty and 'twenty one.
And they give which will be dictated by COVID-19 lockdowns and restrictions.
But here's the bottom line.
Our one deluxe approach is working and.
Enabling us to set new sales records in the middle of a pea and stomach.
Now, let's talk division specifics.
Our top growth segment painter.
And not even exist.
Current form until January 2020 had a successful year.
In addition for Synovus, Sirius XM Radio Alliance data and all the other newly signed clients and distribution partners.
Integrated receivables continues to benefit from positive secular outsourcing trends as new and long standing customers focus on speed and efficiency.
Covid and has put a spotlight on and additional deluxe competitive advantage.
The strength of our balance sheet and our leadership.
During the pandemic, we benefited as a number of institutions shifted volume away from our competitors to the safety of deluxe.
And cloud solutions or other targeted growth area, we made important progress on adding a number of new clients.
You can see we did experience significant directly related COVID-19 impact and financial institutions deferred marketing campaign spend impacting our data driven marketing business.
Additionally, our website services also experienced weaker demand during the year.
We did see encouraging signs for recovery and our incorporation services as we've previously announced.
We're particularly optimistic about data driven marketing as the recovery unfolds.
We're already deeply engaged in planning multiple large scale marketing campaigns for our financial institution customers, adding to our confidence for 'twenty 'twenty, one and beyond.
Next we're going to talk about promotional solutions business and I'm going to talk about two areas.
First is business essentials, where we deliver custom forms and more businesses consume on their routine operations.
Second is branded merchandize used to promote our business.
Encouragingly, we saw volume.
Our business essentials as the year progressed.
We expect to see a rebound of branded merchandise as events and physical promotion return as Covid sales.
Further I'm extremely proud of the speed with which the promotional services team and adopt adapt it to the new reality adjusting our product mix.
We sold $31 billion of personal protective equipment and 2020.
Our business, we had not been and previously were.
We had no source of supply no way to book, an order and no sales training at the beginning of the pandemic.
It's a great example of innovative thinking and speed. This organization can now deliver.
We also signed many new customers focused on our turnkey band its branch services program, giving us more confidence on our future profitable growth.
Sales force is just one of these examples.
Fourth is our check business.
Consistent with previous economic slowdown the secular decline and check was higher due to the impacts of Covid.
We expect the business to rebound in line with historical secular trends as the economy recovers.
Encouragingly, we witnessed a secrete a sequential increase and new check customers, resulting from new business startups as 'twenty and 'twenty unfolded.
This is important evidence of the ongoing necessity of checks.
We were also encouraged to see acceleration of self service and digital order volume acceleration throughout the year.
Proving our digital strategy works.
Our multiple checked whim and expanding market share, bringing important new revenue.
Providing a partial offset.
The list of clients.
Clearly in 'twenty and 'twenty, we have made significant and measurable progress in all four pillars of our strategy to become a sales driven growth trusted business technology company.
Which we achieved all of this and the middle of the pandemic with a new team.
Next.
I want to briefly outline our progress on three areas.
And are helping to accelerate our transformation.
These three critical areas of our talent and technology infrastructure and efficient operating footprint.
First.
Talent.
In 'twenty and 'twenty, we further built on our team expanding product business development and innovation.
And example of how palette and helping them succeed is our development of the medical payment exchange or M. P F.
N P acts as the only health care option, the digitally attaches a check payments to.
For the explanation of payments.
Deliberate them together electronically.
This is important.
Because it doesn't require any work flow changes for anyone.
To accelerate our MTX progress, we announced our joint venture with Echo Health and April of 'twenty and 'twenty.
We also continue to foster a culture of empowerment inclusion and diversity and equity, enabling our employee owners, who bring their full authentic selves to work.
And doing so we're more directly reflected the diverse communities and customers we serve.
All of this helped us achieve status as a 'twenty and 'twenty great place to work.
Our company had never before been so recognized.
Second technology infrastructure.
We considered and execute on our previously discussed upgrades and the biggest thing optimization and efficiencies.
Third.
It's an efficient operating footprint.
We took full advantage of the new work from home reality to drive efficiency and productivity.
We closed an additional 20 for site during the year.
Reducing our location count by 60% and the last two years.
We're particularly encouraged by the future operating savings and significant capital avoidance, we will achieve by relocating both our Minnesota headquarters and Atlanta technology facilities to more efficient spaces.
I do want to discuss M&A for a moment.
As you know since I joined deluxe, we have paused on acquisitions to reduce debt.
Strength in the balance sheet optimize the portfolio get our talent and technology infrastructure in place and importantly, expand our sales capabilities.
As I've outlined today.
We've now delivered on all of these fronts.
And are once again ready to look at opportunistic ways to augment our business through acquisition.
Particularly in our higher growth engines are payments and cloud solutions.
In summary, we are very encouraged by our success on all four of our strategic pillars.
And on our transformative talent technology infrastructure and operating footprint initiatives.
Our solid performance in the midst of the pandemic gives us confidence and our future post pandemic.
For 'twenty and 'twenty, one we look forward to closing the year as a sales driven and mid single digit revenue growth company with margins and the low to mid twenties.
Continuing to drive and enhance value for all shareholders.
Now I'll pass it to Keith for more financial details.
As Barry mentioned deluxe delivered in 2020, we delivered EBITDA margin in line with our plan and guidance, we took swift action to address COVID-19 at the onset and we sustained this focus through the year. The result, we delivered EBITDA margin in line with our commitment to.
Reduced net debt to its lowest level and two and a half years.
And we continued to invest for growth.
Before I get into the details I want to express my gratitude for all my fellow employee owners, who worked tirelessly and overcame many challenges this year for some.
Dave shall work, we began in 2019, 'twenty and 'twenty a successful year of transformation and continued innovation that produced measurable progress positioning us to deliver full year sales driven growth.
That said, we felt the continuing effects of the COVID-19, pandemic and our financial results. Our total revenue in the quarter was $454 $5 million a decline of 12, 9% as compared to the same period last year. However.
However, and increase of three 4% from the third quarter.
For the full year total revenue declined 10, 8% for $1 billion and $791 million.
We reported GAAP net income of $24 $7 million in the quarter and.
$8 $8 million for the full year.
A comparison of reported 2019 and 2020 full year results is difficult given each year was impacted by asset impairment charges.
Our measures of adjusted earnings and adjusted EBITDA exclude these noncash charges, along with restructuring integration and other costs.
These adjustments are detailed in the reconciliations provided in our release.
Our adjusted EBITDA for the quarter was $94 $9 million, resulting in $364 $5 million for the full year.
Adjusted EBITDA margin for the quarter was 29%, bringing full year performance to 24%.
As previously committed our cost containment initiatives improved our adjusted EBITDA margin performance from the first quarter LOE by more than 300 basis points. This brought both Q4 and full year adjusted EBITDA margin into the low end of our pre pandemic long term adjusted EBITDA.
Margin guidance range.
A closer discussion of Q4 segment performance helps demonstrate the resiliency of our new portfolio approach.
If payments continues to experience year on year revenue growth.
<unk> continued to expand EBITDA margins versus prior year.
Promotional expanded revenue for the 15% sequentially versus Q3 and check maintained a strong EBITDA margin.
Despite significant COVID-19 related headwinds to the business.
Consistent with our expectations and as we had shared at the third quarter call payments grew Q4 revenue, 3% to $78 million as compared to prior year, achieving 12% growth for the year and ending at 301 $9 million.
We did see less onetime hardware revenue in the quarter against a tough Q quarter Q4 2019 compare.
Treasury management led the growth with encouraging demand for our integrated receivables as Barry mentioned the team expanded the number of partners that have moved to a full suite of capabilities.
We will continue to work with these partners to onboard these services and worked to expand the number of full service clients in 'twenty and 'twenty one.
Adjusted EBITDA decreased for the quarter and for the full year by $4 $5 million and $6 $3 million respectively for.
For the year adjusted EBITDA margin was 22, 6% well within the range of our pre pandemic guide on slightly lower revenue performance.
We expect to achieve double digit revenue growth for the year with Q1 growth and low single digits as expected.
And while we continue to work on implementing the many new clients we signed in 2020.
We continue to invest to drive growth and as such for assuming adjusted EBITDA margins and the low 20% area through the year.
Cloud solutions revenue declined 27, 1% to $59 $2 million and the quarter and ended the year at 252 $8 million, resulting and a decline of 26% compared to 2019.
Q for data driven marketing solutions revenue remained flat sequentially versus Q3, but experienced a decline versus prior year consistent with pandemic induced financial industry slowdowns and marketing spend.
What you can't see and the revenue performance, there's a number of new data driven marketing clients that signed during the quarter and will.
Benefit us in future periods.
Web and hosted solutions saw declines.
Two loss of customers discussed last year, the economic impact of the macro economic environment and expected attrition from our decisions to exit certain non strategic product lines.
And Q4 cloud achieved a 160 basis point improvement and adjusted EBITDA margin versus prior year and expanded 20 basis points to 24, 4% for the full year, reflecting solid performance against pre pandemic guide are significantly less revenue.
We expect the loss of revenue associated with Q4 2020 product exits, we will continue to impact the business into 2021.
We anticipate cloud margins to remain healthy and the low to mid 20% range.
Promotional solutions fourth quarter 2020 sequential revenue grew by 15, 3% from Q3 to $144 million.
The year over year rate of decline moderated to down 16, 6%, reflecting the continued impact of market conditions.
Adjusted EBITDA margin for the fourth quarter was 14% down from the prior quarter peak.
Full year revenue declined 17, 4% for $529 $6 million with an adjusted EBITDA margin of 12, 6% and was greatly impacted by macroeconomic conditions and 2020.
And promotional solutions, we're seeing a modest rebound and business essentials, but continued to feel COVID-19 related impacts most acutely and marketing promotional products, where revenues are tied to events and branded merchandise.
We believe the business will continue to improve but we are expecting we're not expecting a rapid recovery in 'twenty and 'twenty one.
We are anticipating improved adjusted EBITDA margins throughout 2021 in the low to mid teens as a result of cost actions taken in 2020, including changes and key distribution relationships throughout 2020 and continuing in 2021.
Checks fourth quarter revenue declined 10% from last year for $173 $3 million due to the secular trend combined with the impact of the pandemic.
Q4, adjusted EBITDA margin levels of 48, 1% helped largely study versus Q3 declining only 10 basis points sequentially. Despite lower revenue levels, but remained lower than 2019 levels. As a result of increased selling costs, new wins and technology investments and support of our one deluxe.
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Full year, Chuck revenue declined nine 4% to $706 $5 million as compared to last year and adjusted EBITDA margin decreased to 48, 4%.
Based on the high renewal rates and new business as one and 2020, we do anticipate check recovery rates in 'twenty and 'twenty one to return to mid single digit declines consistent with the recovery from previous economic slowdowns.
Free cash flow defined as cash provided by operating activities less capital expenditures was $155 million for 2020, a decline of $65 $1 million as compared to last year.
The decline was primarily the result of lower earnings, partially offset by lower interest taxes integration and lower capex.
We did not repurchase common stock and Q4, and we will continue to evaluate future repurchases in 'twenty and 'twenty one.
We ended the quarter with strong liquidity of $425 million, including $123 million and cash <unk>.
During the quarter, we reduce the amount drawn under the credit facility by $200 million ending.
Ending the year with $840 million drawn a reduction of $44 million in the year.
Resulting net debt continued to decrease through the year ending at $717 million, the lowest level and two and a half years.
Our board approved a regular quarterly dividend of <unk> 30 per share on all outstanding shares the.
The dividend will be payable on March one 2021 to all shareholders of record on February 16th 2021.
Our strong execution and solid financial position give us confidence to establish guidance for the full year of 2021.
Specific timing for economic recovery remains uncertain.
Our expectation is though for first quarter of 'twenty and 'twenty, one will feel much like a continuation of the fourth quarter of 'twenty and 'twenty as a result of the ongoing pandemic.
We are poised for recovery to begin in the second quarter, enabling us to exit the year, a sales driven mid single digit revenue growth company.
All of this means we expect to achieve full year 2021 revenue growth of zero to 2% with full year 2021, adjusted EBITDA margin of 20% to 21%.
We expect to invest approximately $90 million and Capex to continue with important transformation work innovation investments and building future scale across all our product categories.
Before I pass it back to Barry I want to summarize for you.
Our very strong financial stewardship, combined with our new leadership team, winning sales strategy and ownership culture allowed us to not only protect and improve the company's financial strength, while simultaneously positioning us well for 2021 and beyond.
Covid certainly took its toll but our strong team delivered in the worst of times and we proved our cash generating business model is highly durable and our transformation is real.
All of this gives us much confidence and our future.
Now back to Barry.
Thanks Keith.
And early 'twenty and 'twenty, we could not have anticipated the year that was in front of us.
But the <unk> have always had the grit to succeed.
Our team just put our heads out and went to work.
We're proud of our progress on our strategy and transformation to become a trusted business technology company. We're proud of our strengthened balance sheet and improved portfolio. We're proud to be a sales driven revenue growth company. Our cross sell results on all time record sales success.
But what's more impressive to me.
We did all of this and the middle of a global pandemic.
And now have great confidence will be a sales driven company growing low to mid single digits with margins and the low to mid twenty's over long term and expect to be that company exiting this year.
We've done the work we've completed the preparations and laid the groundwork and.
And now our company is well positioned for the future.
I can't close without recognized and extraordinary contributions of my fellow deluxe us.
Our team went to work and got the job done.
We're a team living our purpose our values and ownership culture, because we're all shareholders too.
Now we'll take questions.
Thank you.
As a reminder, ladies and gentlemen to ask a question you will need to press star one on your telephone to withdraw your question press the pound key.
As a reminder to ask a question. Please press star one.
First question comes from the line of Charlie Strausser with C. J S.
Hi, good afternoon.
Hey, Charlie.
And just a couple of quick questions on the quarter.
And despite having some modest sequential revenue growth from Q3 gross margins did have a decline.
250 basis points from Q3 sequentially and just wanted to see if there's anything kind of onetime in nature and built into that that we should.
Think about that.
Yes, Charlie I'll have I'll have Keith gave you some more detail.
But in Q4, we saw some continuing effects of Covid.
And we continue to invest for the future and which is what's given us so much confidence going into 'twenty 'twenty, one and if your question is do we think Thats a permanent change, we do not and and the forecast and the guidance that Keith just provided we believe we will deliver our full year performance in 'twenty one.
Margin of 20% to 21%.
Thanks, Barry Yeah Charles.
That's accurate.
We were right in line with where we expected to be on the quarter.
Got it okay. Thank you and then on the Czech business and our sales were down 10%.
And he says to what.
And with volumes look like and the quarter and for the year.
Yes.
I think what we saw was consistent Charlie with every other economic slowdown where the consumption of checks on the business. The business environment flow is there's just more less commerce being conducted.
And that's consistent both and volume and.
Our revenue.
We have seen and what we consider important green shoots and that business just on the run rate of the business as you know the single largest source of new customers for us during the pandemic as that new business starts, which we think is a great leading indicator for US and then also going into the new year, we have won a significant.
Number of new check customers and of course will be on board as the year unfolds with it that also helps moderate.
On the secular decline and checks.
And and just picking up on the new business starts do you have any kind of data points.
<unk>.
How many small business customers you added organically and in the quarter.
And that way.
Charles we don't we don't produce that statistic.
But what I can tell you is if you we had and announcements in the day.
December we talked about double digit increase and the consumption of our incorporation services and now we're seeing a number of new business and corporations coming to us for checks and logo design and other parts of our business.
So we are encouraged by that but we don't we don't publish a specific number.
Got it understood and then just shifting to the guidance you gave for 2021.
Can you maybe give us a little bit more insight into the assumptions, forming that guidance and perhaps some additional color for Q1.
In terms of.
The profitability in the quarter.
And then you.
You had alluded that it would be similar to Q4, but that's just for sales or the sales and profitability.
Yeah, and so we think that Q1 is going to look a lot like a continuation of Q for Covid has not gone away and on top of that we're lapping what you'll recall was a particularly strong Q1, where we had we're delivering sales driven growth for the first time and a decade and the first two.
For the year.
So we say that we will see we expect margins to be consistent with Q4, and we think for the full year, we're confident about delivering that as well.
Well, we did say and <unk>.
Charlie I'm sure as you're building your model will be helpful. To you. We think that Q1 will be consistent or continuation of what happened in Q4, but were confident that well and a year and exit the year.
A mid single digit revenue growth company with margins and that 20% to 21% range. So you can do the math and understand what how were expecting the overall macro economy to rebound and our business with it.
Great. Thank you I'll jump back in the queue. Thank you Lee maybe.
Good day.
Thank you.
And once again to ask a question. Please press star one on your telephone.
Our next question comes from the line of Chris Mcginnis with Sidoti and company.
Yes. Good afternoon, thanks for taking my questions and nice quarter.
Hey, guys and just a great job.
I guess just.
And just hitting on the on the guidance a little bit can you just maybe talk a little bit about your outlook for <unk> for cost and a sense of just the operating cost or the corporate cost. However, you want to lay it out.
And the sense that you know as things start to strengthen and should you see some of this maybe some of the cuts that you took in 'twenty.
For Covid come back can you just talk a little bit about your cost structure and ice.
See that playing out for the year. Thank you.
Absolutely Scott.
We're very disciplined in 'twenty, and 'twenty and adjusting our cost for the new reality and we took further actions in the fourth quarter of further material actions in the fourth quarter to position us.
For 2021, so that because we were aggressive on the actions earlier in the year, we were able to deliver on our financial performance for the whole year that we just reported but we also have positioned us well for 'twenty. One this year and going forward again, which is why we feel like we can guide for the full year.
Air and <unk>.
On a year, 21% because we have gone after.
Every aspect of the company's cost you heard us talk about how it's gone after real estate closing, 60% of our site.
We've implemented technology that is taking out duplicate operating expenses.
And across the enterprise, where we have invested in sales, but were being super efficient about that and so we will be on boarding those business as the as the year unfolds.
Great.
And just one point on the I know you closed some of them all because as you open up the <unk>.
Others can you just talk about is that a cost saving differentials that time.
The offset each other once.
Atlantic gets up and running.
Yes.
And I'll have Christmas actually this is one of the things that I think talks to the savvy of our team.
We will actually have less operating expense as a result for best and have a superior workplace environment that gives us the flexibility for the future.
But just sort of by way of comparison on our explanation, we have exited our and sold.
Headquarters facility and the twin cities and we've taken a lease and downtown Minneapolis, and we will be able to take occupancy later in the year.
The great part about that strategy as we were able to free up the cash that was being held and that owned real estate assets, but more importantly, we have weighted at least $40 million of capex to modernize their it infrastructure and modernize that physical plant and instead, we're going to end up with a company with it on.
Operating footprints and a more attractive location with more play benefits and amenity and we will do it from less cost and less capex and materially less bulk. So we think it's one of those examples on the comps.
And being very opportunistic and moving quickly to seize an opportunity which is what we did and a similar similar situation with our technology Center in Atlanta.
Great Thanks for that.
And then just.
Wins on the on the channel side.
And you talked about the strength of your balance sheet.
And there's still more opportunities out there and anything close to what you're doing and congrats.
Congrats on the announcement.
And absolutely we.
Chasing a number of material additional check opportunities nothing that we're obviously.
Our senior debt.
Scott today, but I will.
And the price of our company's performance through this well short of what we all would have liked from a financial robustness.
Security reliability strength of our balance sheet all of those things that we did this year and continue to do to manage this company responsibly is we're getting rewarded for it because we are winning business as a result of that strong financial stewardship.
The other thing.
But I would tell you Chris is.
The market seems to really respond well and customers really respond well when they they understand we've said what we were going to do and then we did what we said we were going on there.
This year, we were going to recycling the company into for clear operating segments. We did it we said we're going to deliver a sales day, if a growth company. We did it and we delivered sales driven growth for the full year of course, excluding COVID-19, we reduced our debt, we improved our balance sheet and cleaned up our portfolio of products, we've built a world class team.
And our technology platform, we rightsize, our real estate footprint.
And we did all of that and the middle of Covid.
And still deliver the margins that we were going to deliver for the company. So that just gives us a lot of confidence and I think honestly. It gives our customers a lot of confidence and our management team and our balance sheet, which is just a great way to start a conversation with a new customer.
Great and.
Just a few more questions. If you don't mind just around the data driven management, you've talked about some new wins, there just timing of that coming on board.
Yes, just and talking to the customer base is that a amid COVID-19 and you're kind of.
The option or do you think thats later.
Do you mind, the shut for a little bit of light on thanks.
Chris I wish I had a perfect crystal ball on that.
But we expect.
As we said as we said earlier, we're working on a number of large scale marketing plans for a number of large financial institutions.
And.
Where exactly they will fall.
Don't have exact precision on who.
And we have a lot of confidence and the scale and the scope of those programs and what the revenue that will generate for our company would be.
Will it be all in Q1, I don't think so I don't think anyone would expect that as the COVID-19. The Covid crisis continues, but we would expect to see that continue to accelerate through the year as markets and small business on the whole community opens again as we start moving past COVID-19.
And we would expect.
Fully except for the banks will be aggressive as as things reopen to try to win new customers.
Great.
And that's all efforts today I appreciate you for taking my questions and.
Congrats on the quarter and good luck for Q1.
Thanks.
Thank you and we have a follow up question for for the line of Charlie Strausser with C. J S.
And just a couple more questions you talked about.
Possibly resuming M&A again very.
Thoughts on valuation, obviously a lot of it.
Valuations have et cetera.
And the public markets.
Is that something that could potentially thank.
Thank you more difficult for you to do.
Certainly if we were going to go.
After which we are not.
And to go after some of the ultra high flying and Ultra high P/e companies that would be very difficult for us to execute on but we think there are a number.
Good quality assets.
That we.
We could reasonably a forward there'll be accretive for shareholders and that could benefit from all the work we've done here and it's becoming a sales driven growth company with a great balance sheet debt, we think bringing those assets into our company, we could create additional value.
<unk> all the things that we've worked on and built on the last two years.
So we will be very responsible here and you know.
Importantly, we don't we don't feel any pressure, we don't have to transact. We've done the work we like our business model, we won't do anything stupid and we don't need to do anything stupid, but we do think that there is potential lasalle based on very intriguing assets that are available to us and we have now positioned the company well to to go after them.
Yes, we think it's the right fit.
Great and just one last question on on the M&A front are you factoring in any acquisitions into your guidance for the year.
At this time.
And that is true.
And the real real break from that.
On the past right we're on.
And then we said we're going to become and again, we said we'd become a sales driven revenue growth companies. We are we're not basically and so we're going to last for.
Things that arent as identified.
Wherever we said we'd look for.
That good old fashioned way by selling sound like Salt Lake boarding and making our customers happy and doing it all over again.
That's great. Thank you very much.
Thank you and it looks like we have another follow up from the line of Chris Mcginnis with Sidoti and company.
Yes, thanks for taking just one quick one.
And give them a capex number for 'twenty and 'twenty one.
Sure.
Guide there is about $90 million.
And his name Okay. Thank you very much on for Jim.
Yes.
Thank you.
And I'm showing no further questions so with that I'll turn the call back over to Chief Communications, and HR Officer, Jane Elliott for any closing remarks.
Thanks, operator.
Before we conclude I'd like to mention the following conferences, where management will present.
J P. Morgan 'twenty 'twenty, one global high yield and leverage Finance conference on March 2nd.
And Sidoti Virtual Investor Conference and March 'twenty for Us.
Thank you for joining and until next time stay safe and healthy thanks, everybody.
Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program and you may now disconnect.
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