Deluxe ( DLX), a check printer, said it swung to a loss in the second-quarter.

But shares surged 14% Thursday after the company said it identified opportunities that are expected to reduce the cost structure by at least $150 million, net of required investments, by the end of 2008.

Deluxe lowered its dividend by 37.5% and declared a quarterly dividend of 25 cents a share. The dividend is payable on Sept. 5, to shareholders of record at the close of business on Aug. 21.

The company posted a loss of $2 million, or 5 cents a share, in the quarter, compared with earnings of $42 million, or 83 cents a share, a year ago. Second quarter results include a pre-tax asset impairment loss of $45 million, or 57 cents a share, related to the abandonment of a software project. Analysts polled by Thomson First Call were expecting a loss of 9 cents a share in the most recent quarter.

Second-quarter revenue decreased 7.1% to $403 million as against analysts' expectation of $393.8 million.

The company expects to earn 41 cents a share to 45 cents a share on sales of $395 million to $405 million in the third quarter and $1.41 a share to $1.51 a share on sales of $1.63 billion to $1.65 billion in the full year. Analysts are expecting the company to earn 49 cents a share on sales of $394.8 million for the third quarter and a $1.46 a share on sales of $1.6 billion for the full year.

Sales from small business services segment increased 4% to $233 million. Revenue from financial services fell 21.5% to $117 million due to lower revenue per order and the $12 million of contract termination payments in 2005.

Sales from direct checks segment dropped 13.1% to $53 million.

The company's shares rose $1.90 to $15.65.
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