10-QPeriod: Q2 FY2013

CORPAY, INC. Quarterly Report for Q2 Ended Jun 30, 2013

Filed August 7, 2013For Securities:CPAY

Summary

FleetCor Technologies, Inc. (now Corpay, Inc.) reported strong revenue growth for the second quarter and first half of 2013, driven by a combination of organic growth and strategic acquisitions. Total revenues increased by 28.5% year-over-year for the quarter and 30.4% for the first half, with the International segment showing particularly robust growth of 57.1% and 52.0%, respectively. This expansion is attributed to successful integration of recent acquisitions in Australia and New Zealand, as well as continued organic performance in existing payment programs. Net income also saw significant increases, rising 34.4% for the quarter and 42.8% for the first half. The company's operating margins remained strong, particularly in the North America segment, while the International segment's margin improved significantly, reflecting the benefits of scale and integration. FleetCor's liquidity position is solid, supported by a strong cash balance and ample available credit facilities, enabling continued investment in growth initiatives and potential future acquisitions.

Financial Highlights

48 data points
Beta

Revenue

$220.87M

Net Income

$73.10M

33.1% Net Margin

EPS (Diluted)

$0.87

Total Assets

$3.01B

Cash & Equivalents

$292.90M

Free Cash Flow

$91.06M

Financial Statements
Beta
Revenue$220.87M
Operating Income$109.07M
Interest Expense$3.76M
Net Income$73.10M
EPS (Basic)$0.90
EPS (Diluted)$0.87
Shares Outstanding (Basic)81.57M
Shares Outstanding (Diluted)84.46M

Key Highlights

  • 1Total revenues increased by 28.5% year-over-year to $220.9 million for the three months ended June 30, 2013.
  • 2Net income grew by 34.4% year-over-year to $73.1 million for the three months ended June 30, 2013.
  • 3The International segment revenue surged by 57.1% to $101.4 million for the quarter, outpacing North America's 11.4% growth.
  • 4Acquisitions in Australia (Fleet Card) and New Zealand (CardLink) in early 2013 are contributing to the International segment's expansion.
  • 5Consolidated operating income increased by 33.9% to $109.1 million for the quarter, with operating margins improving to 49.4%.
  • 6Goodwill and other intangible assets increased significantly due to acquisitions, indicating continued strategic expansion.
  • 7The company maintains a strong liquidity position with $292.9 million in unrestricted cash and cash equivalents and substantial available credit facilities.

Frequently Asked Questions

Revenue growth was driven by a combination of organic growth in payment programs, as evidenced by increases in both transaction volume and revenue per transaction, and the full-period impact of acquisitions completed in 2012 and the contribution of new acquisitions in 2013, particularly in the International segment.

These acquisitions are primarily contributing to the significant growth in the International segment. The acquisition of the Fleet Card business in Australia and CardLink in New Zealand are establishing and expanding the company's presence in these regions and are showing positive revenue contributions.

FleetCor's financial health appears strong. The company reported $292.9 million in unrestricted cash and cash equivalents as of June 30, 2013. Furthermore, they have significant borrowing capacity available under their Credit Facility ($753 million available) and Securitization Facility, indicating ample resources to meet operating needs and pursue future growth opportunities.

The company noted that the macroeconomic environment had a slightly negative impact on consolidated revenue for the quarter, primarily due to lower fuel spread margins and lower fuel prices. However, this was largely offset by the positive contributions from acquisitions and organic growth.