10-QPeriod: Q1 FY2014

CORPAY, INC. Quarterly Report for Q1 Ended Mar 31, 2014

Filed May 12, 2014For Securities:CPAY

Summary

FleetCor Technologies, Inc. (now Corpay, Inc.) reported strong first-quarter 2014 results, with total revenues increasing by 31.1% year-over-year to $253.9 million. This growth was driven by both organic expansion and the successful integration of acquisitions completed in 2013, which contributed approximately $45 million in revenue. The company demonstrated robust operating income growth of 21.1% to $114.1 million, although operating margins saw a slight compression from 48.7% to 45.0% due to increased stock-based compensation, acquisition-related costs, and amortization expenses. Net income rose by 16.2% to $75.1 million, or $0.88 per diluted share, compared to $64.7 million, or $0.77 per diluted share, in the prior year period. The company also highlighted significant growth in transaction volumes, up 18.1%, with an increase in revenue per transaction. Liquidity remains strong, with $283.4 million in unrestricted cash and cash equivalents, and substantial availability under its credit facilities, positioning the company for continued growth and strategic investments.

Financial Highlights

48 data points
Beta

Revenue

$253.91M

Net Income

$75.11M

29.6% Net Margin

EPS (Diluted)

$0.88

Total Assets

$4.04B

Cash & Equivalents

$283.37M

Free Cash Flow

$45.91M

Financial Statements
Beta
Revenue$253.91M
Operating Income$114.14M
Net Income$75.11M
EPS (Basic)$0.91
EPS (Diluted)$0.88
Shares Outstanding (Basic)82.74M
Shares Outstanding (Diluted)85.69M

Key Highlights

  • 1Total revenues increased by 31.1% to $253.9 million in Q1 2014 compared to Q1 2013, driven by organic growth and acquisitions.
  • 2Net income grew by 16.2% to $75.1 million, with diluted EPS rising to $0.88 from $0.77.
  • 3Operating income increased by 21.1% to $114.1 million, reflecting strong performance across both North America and International segments.
  • 4Total transactions processed increased by 18.1% year-over-year, indicating robust customer activity and network utilization.
  • 5The company successfully managed its liquidity with $283.4 million in unrestricted cash and significant availability under its credit facilities.
  • 6Depreciation and amortization expenses saw a substantial increase of 66.9%, primarily due to the amortization of intangible assets from recent acquisitions.
  • 7International segment revenue experienced a strong 37.0% growth, outperforming North America's 25.6% growth, largely due to recent acquisitions in that region.

Frequently Asked Questions

The primary drivers of revenue growth were organic expansion within existing payment programs, leading to increased transaction volumes and revenue per transaction, combined with the positive impact of acquisitions completed in 2013. These acquisitions contributed approximately $45 million to the revenue in the quarter.

Net income increased by 16.2% to $75.1 million. While operating income grew by 21.1%, operating margins slightly compressed from 48.7% to 45.0%. This compression was mainly due to increased general and administrative expenses (driven by stock-based compensation and acquisition-related costs) and a significant rise in depreciation and amortization, largely from acquired intangible assets.

The company's liquidity position remains strong, with $283.4 million in unrestricted cash and cash equivalents at the end of the quarter. Additionally, it has substantial undrawn availability under its credit and securitization facilities. Management believes these resources are sufficient to meet its liquidity needs for at least the next twelve months.

Acquisitions completed in 2013 had a significant impact, contributing approximately $45 million in revenue. They also led to increased operating expenses, particularly in processing, selling, general and administrative, and depreciation and amortization due to the amortization of acquired intangible assets and integration costs. These acquisitions also drove higher revenue per transaction, especially in the international segment.