10-QPeriod: Q3 FY2013

CORPAY, INC. Quarterly Report for Q3 Ended Sep 30, 2013

Filed November 8, 2013For Securities:CPAY

Summary

FleetCor Technologies, Inc. (CPAY) reported a strong third quarter ended September 30, 2013, with significant year-over-year growth in both revenue and net income. Total revenues increased by 20.4% to $225.2 million, driven by organic growth and the impact of recent acquisitions, particularly in the International segment which saw a 28.6% revenue increase. Net income also saw a substantial rise of 31.8% to $78.6 million, reflecting improved operating efficiency and strategic expansion. The company continued its aggressive acquisition strategy, completing several international acquisitions during the first nine months of 2013, totaling $482.5 million. These acquisitions are expected to bolster the company's global presence and product offerings. FleetCor's financial position remains robust, with substantial cash and cash equivalents and access to significant credit facilities to support ongoing operations and future growth initiatives.

Financial Highlights

48 data points
Beta

Revenue

$225.15M

Net Income

$78.62M

34.9% Net Margin

EPS (Diluted)

$0.93

Total Assets

$3.48B

Cash & Equivalents

$345.69M

Free Cash Flow

$120.06M

Financial Statements
Beta
Revenue$225.15M
Operating Income$111.25M
Interest Expense$3.76M
Net Income$78.62M
EPS (Basic)$0.96
EPS (Diluted)$0.93
Shares Outstanding (Basic)81.97M
Shares Outstanding (Diluted)84.91M

Key Highlights

  • 1Revenue increased by 20.4% to $225.2 million for the third quarter of 2013 compared to the same period in 2012.
  • 2Net income grew by 31.8% to $78.6 million for the third quarter of 2013 compared to the prior year.
  • 3International segment revenue experienced robust growth of 28.6%, driven by acquisitions and organic expansion.
  • 4The company completed significant acquisitions totaling $482.5 million in the first nine months of 2013, enhancing its global footprint.
  • 5Operating income increased by 29.6% to $111.3 million, with operating margins improving to 49.4% from 45.9% year-over-year.
  • 6Strong cash flow from operations of $208.0 million for the nine-month period, supporting investment activities and debt servicing.
  • 7FleetCor maintained a solid balance sheet with $345.7 million in cash and cash equivalents and ample borrowing capacity.

Frequently Asked Questions

Revenue growth was primarily driven by a combination of organic growth in existing payment programs, an increase in both transaction volume and revenue per transaction, and the full-period impact of acquisitions completed in 2012 and 2013. The International segment, in particular, saw significant revenue increases due to strategic acquisitions.

Acquisitions have been a key growth strategy, contributing significantly to revenue and operational expansion. The company completed several substantial acquisitions in the first nine months of 2013, totaling $482.5 million, which expanded its global reach, particularly in international markets. These acquisitions are also credited with driving higher revenue per transaction compared to the company's existing businesses.

FleetCor maintains a strong liquidity position with $345.7 million in cash and cash equivalents at September 30, 2013. Additionally, the company has access to significant credit facilities, including an $850 million revolving credit facility and a $500 million securitization facility. Management believes these resources, combined with cash flow from operations, are sufficient to meet liquidity needs for at least the next twelve months, absent major acquisition opportunities.

Fuel prices and their associated spreads have a notable impact on FleetCor's revenue. While higher fuel spread margins positively contributed to revenue in the third quarter, lower fuel prices and foreign exchange rate fluctuations had a mixed but slightly negative impact on the International segment's revenue. Approximately 20% of revenue is directly influenced by the absolute price of fuel, and about 15-17% is tied to fuel-price spreads.