10-QPeriod: Q3 FY2023

CORPAY, INC. Quarterly Report for Q3 Ended Sep 30, 2023

Filed November 9, 2023For Securities:CPAY

Summary

Corpay, Inc. (CPAY) reported solid revenue growth of 8.7% for the third quarter of 2023, reaching $970.9 million, and a 10.9% increase for the first nine months, totaling $2.82 billion. Net income for the quarter rose by 9.1% to $271.5 million, though it saw a slight decrease of 0.4% year-to-date to $726.0 million. The company successfully navigated a challenging macroeconomic environment, including rising interest rates and geopolitical uncertainties. Key drivers of growth included strong performance in the Corporate Payments segment and continued expansion in Brazil and the UK. The company also completed several strategic acquisitions in 2023, notably PayByPhone Technologies, Inc., to bolster its vehicle payments business and expand its geographic reach. Corpay demonstrated effective expense management, leading to an expansion in EBITDA margin to 54.5% for the quarter and 52.7% year-to-date, indicating improved operational efficiency. The company also successfully exited its Russian operations in August 2023, recognizing a net gain on disposal. Despite increased interest expenses due to rising rates, Corpay's strong operating performance and disciplined capital allocation, including share repurchases, position it well for future growth.

Financial Highlights

49 data points
Beta

Revenue

$970.89M

Net Income

$271.50M

28.0% Net Margin

EPS (Diluted)

$3.64

Total Assets

$15.67B

Cash & Equivalents

$1.09B

Free Cash Flow

$247.43M

Financial Statements
Beta
Revenue$970.89M
Operating Income$444.98M
Net Income$271.50M
EPS (Basic)$3.71
EPS (Diluted)$3.64
Shares Outstanding (Basic)73.17M
Shares Outstanding (Diluted)74.60M

Key Highlights

  • 1Total revenues increased by 8.7% year-over-year to $970.9 million for the three months ended September 30, 2023.
  • 2Net income for the third quarter of 2023 increased by 9.1% to $271.5 million compared to the prior year period.
  • 3Operating income increased by 14.3% to $445.0 million for the three months ended September 30, 2023.
  • 4The Corporate Payments segment showed significant revenue growth of 31.4% year-over-year for the third quarter.
  • 5The company successfully completed the acquisition of PayByPhone Technologies, Inc. for approximately $303.2 million, net of cash.
  • 6EBITDA margin improved to 54.5% for the third quarter of 2023, up from 52.2% in the prior year period.
  • 7The company completed the disposition of its Russia business in August 2023, resulting in a net gain on disposal.

Frequently Asked Questions

Corpay reported a consolidated revenue of $970.9 million for the three months ended September 30, 2023, representing an increase of 8.7% compared to the prior year period. This growth was primarily driven by organic growth and new sales, partially offset by macroeconomic factors and the disposition of its Russia business.

Net income for the third quarter of 2023 increased by 9.1% to $271.5 million, or $3.64 per diluted share, compared to $248.9 million, or $3.29 per diluted share, in the same period last year. Operating income saw a significant increase of 14.3% to $445.0 million.

The Corporate Payments segment was a strong performer with revenue growth of 31.4%. The Fleet segment saw a revenue decrease of 7.5%, impacted by macroeconomic factors and the Russia disposition. Lodging revenues grew 12.2%, and Brazil revenues increased by 23.6%.

Key events include the successful disposition of the Russia business, resulting in a net gain, and the completion of several acquisitions, most notably PayByPhone Technologies, Inc., which is expected to advance the company's vehicle payments strategy. The company also navigated rising interest rates, which led to higher interest expenses.