Release Details

FleetCor Reports Fourth Quarter 2014 Financial Results

February 5, 2015

Fourth Quarter Adjusted Net Income Per Share Grows 29% Year-Over-Year

NORCROSS, Ga.--(BUSINESS WIRE)--Feb. 5, 2015-- FleetCor Technologies, Inc. (NYSE:FLT), a leading global provider of fuel cards and workforce payment products to businesses, today reported financial results for its fourth quarter ended December 31, 2014.

“Our fourth quarter results were very strong and helped complete a terrific 2014,” said Ron Clarke, chairman and chief executive officer, FleetCor Technologies, Inc. “For full year 2014, total revenue grew 34%, organic revenue grew approximately 13%, and adjusted net income grew 31%. We had a number of new oil partner wins, we entered Germany, we added some new executive talent, and we completed the Comdata deal, so a very good 2014.”

Financial Results for Fourth Quarter 2014:

GAAP Results

  • Total revenues increased 47% to $376.7 million compared to $255.5 million in the fourth quarter of 2013. Comdata, which was acquired on November 14, 2014, contributed approximately 27 percentage points of the revenue growth in the quarter, or $70 million to the fourth quarter of 2014.
  • The Company reported GAAP net income1 of $109.5 million or $1.21 per diluted share in the fourth quarter of 2014 compared to GAAP net income of $68.1 million or $0.80 per diluted share in the fourth quarter of 2013. Included in GAAP net income in the fourth quarter of 2014 was an estimated loss of approximately $19 million related to the Comdata acquisition (including all deal related expenses), and approximately $29 million gain in unusual items reflecting adjustments to purchase accounting entries for contingent consideration and tax indemnifications for the company’s 2013 acquisitions of DB and VB in Brazil.

Non-GAAP Results

  • Adjusted revenues1 (revenues, net less merchant commissions) increased 44% to $343.4 million compared to $237.7 million in the fourth quarter of 2013. Comdata contributed approximately 29 percentage points of revenue growth, or $70 million to the fourth quarter of 2014 results.
  • Adjusted net income1 increased 37% to $125.8 million compared to $92.1 million in the fourth quarter of 2013;
  • Adjusted net income per diluted share1 increased 29% to $1.39 compared to $1.08 in the fourth quarter of 2013. Included in adjusted net income per diluted share for the fourth quarter of 2014 was an estimated loss of approximately $0.06 per diluted share related to the Comdata acquisition (including all deal related expenses).

Fiscal Year 2015 Outlook:

“For 2015 we have a number of macro-economic headwinds affecting our business, primarily foreign exchange rates, market fuel spreads, and fuel prices,” said Eric Dey, chief financial officer FleetCor Technologies, Inc. “In aggregate, we are estimating that these three macro-economic factors create approximately $160 million revenue headwind and approximately $1.00 adjusted net income per diluted share headwind versus the 2014 averages. Despite these headwinds we like our fundamentals, and expect year-over-year adjusted net income per diluted share growth of 17% at the midpoint of our guidance range. Also, in constant currency our adjusted net income per diluted share guidance would have been approximately $6.40 at the midpoint of the range and with normalized spreads and fuel prices at the 2014 average our guidance would have been approximately $7.00 in adjusted net income per diluted share.”

For fiscal year 2015 FleetCor Technologies, Inc. is expecting the following:

  • Total revenues between $1,600 million and $1,650 million
  • Adjusted net income between $560 million and $580 million
  • Adjusted net income per diluted share between $5.95 and $6.15

The Company's fiscal-year guidance assumptions for 2015 are as follows:

  • Weighted fuel prices equal to $2.58 per gallon average for 2015 in the U.S. compared to $3.56 per gallon average in the U.S. in 2014, down approximately 30%
  • Market spreads slightly better than prior year in the first quarter of 2015, neutral in the second quarter, and worse in the third and fourth quarters compared to 2014
  • Foreign exchange rates equal to the seven day average ended January 13, 2015
  • SVS business for the entire first quarter of 2015
  • Continued weakness in the Company’s Russian business
  • Full year tax rate of 32.1%
  • Fully diluted shares outstanding of 94.3 million shares
  • No impact related to acquisitions or material new partnership agreements not already disclosed

1

  Reconciliations of GAAP results to non GAAP results are provided in Exhibit 1 attached. Additional supplemental data is provided in Exhibit 2 and segment information is provided in Exhibit 3.
     

Conference Call

The Company will host a conference call to discuss fourth quarter 2014 financial results today at 5:00pm ET. Hosting the call will be Ron Clarke, chief executive officer, and Eric Dey, chief financial officer. The conference call can be accessed live over the phone by dialing (877) 407-0784, or for international callers (201) 689-8560. A replay will be available one hour after the call and can be accessed by dialing (877) 870-5176 or (858) 384-5517 for international callers; the conference ID is 13599700. The replay will be available until February 12, 2015. The call will be webcast live from the Company's investor relations website at investor.fleetcor.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws. Statements that are not historical facts, including statements about FleetCor's beliefs, expectations and future performance, are forward-looking statements. Forward-looking statements can be identified by the use of words such as "anticipate," "intend," "believe," "estimate," "plan," "seek," "project," "expect," "may," "will," "would," "could" or "should," the negative of these terms or other comparable terminology. Examples of forward-looking statements in this press release include statements relating to revenue and earnings guidance and assumptions underlying financial guidance. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those contained in any forward-looking statement, such as delays or failures associated with implementation; fuel price and spread volatility; changes in credit risk of customers and associated losses; the actions of regulators relating to payment cards or resulting from investigations; failure to maintain or renew key business relationships; failure to maintain competitive offerings; failure to maintain or renew sources of financing; failure to complete, or delays in completing, anticipated new partnership arrangements or acquisitions and the failure to successfully integrate or otherwise achieve anticipated benefits from such partnerships or acquired businesses; failure to successfully expand business internationally; the impact of foreign exchange rates on operations, revenue and income; the effects of general economic conditions on fueling patterns and the commercial activity of fleets, as well as the other risks and uncertainties identified under the caption "Risk Factors" in FleetCor's Annual Report on Form 10-K for the year ended December 31, 2013, filed with the Securities and Exchange Commission on March 3, 2014. FleetCor believes these forward-looking statements are reasonable; however, forward-looking statements are not a guarantee of performance, and undue reliance should not be placed on such statements. The forward-looking statements included in this press release are made only as of the date hereof, and FleetCor does not undertake, and specifically disclaims, any obligation to update any such statements or to publicly announce the results of any revisions to any of such statements to reflect future events or developments.

About Non-GAAP Financial Measures

Adjusted revenue is calculated as revenues, net less merchant commissions. Adjusted net income is calculated as net income, adjusted to eliminate (a) non-cash stock-based compensation expense related to share-based compensation awards, (b) amortization of deferred financing costs and intangible assets, (c) amortization of the premium recognized on the purchase of receivables, (d) loss on the early extinguishment of debt, (e) our proportionate share of amortization of intangible assets at our equity method investment, and (f) other non-cash adjustments. Adjusted EBITDA is calculated as net income as reflected in our income statement, adjusted to eliminate (a) interest expense, (b) tax expense, (c) depreciation of long-lived assets, (d) amortization of intangible assets, (e) other (income) expense, net, (f) gains and losses at equity method investment, and (g) loss on early extinguishment of debt. The Company uses adjusted revenues as a basis to evaluate the company’s revenues, net of the commissions that are paid to merchants to participate in our card programs. The commissions paid to merchants can vary when market spreads fluctuate in much the same way as revenues are impacted when market spreads fluctuate. The Company believes this is a more effective way to evaluate the company’s revenue performance. The Company uses adjusted EBITDA as a basis to evaluate our operating performance net of the impact of certain items during the period. We believe that adjusted EBITDA may be useful to investors for understanding our operating performance on a consistent basis. We prepare adjusted net income to eliminate the effect of items that we do not consider indicative of our core operating performance. Adjusted revenues and adjusted net income are supplemental measures of operating performance that do not represent and should not be considered as an alternative to revenues, net, net income or cash flow from operations, as determined by U.S. generally accepted accounting principles, or U.S. GAAP, and our calculation thereof may not be comparable to that reported by other companies. We believe it is useful to exclude non-cash stock-based compensation expense from adjusted net income because non-cash equity grants made at a certain price and point in time do not necessarily reflect how our business is performing at any particular time and stock-based compensation expense is not a key measure of our core operating performance. We also believe that amortization expense can vary substantially from company to company and from period to period depending upon their financing and accounting methods, the fair value and average expected life of their acquired intangible assets, their capital structures and the method by which their assets were acquired; therefore, we have excluded amortization expense from our adjusted net income. We also exclude loss on the early extinguishment of debt from adjusted net income, as this expense is non-cash and is one-time in nature and does not reflect the ongoing operations of the business.

Management uses adjusted revenues, adjusted net income, and adjusted EBITDA:

  • as measurements of operating performance because they assist us in comparing our operating performance on a consistent basis;
  • for planning purposes, including the preparation of our internal annual operating budget;
  • to allocate resources to enhance the financial performance of our business; and
  • to evaluate the performance and effectiveness of our operational strategies.

We believe adjusted revenues, adjusted net income and adjusted EBITDA are key measures used by the Company and investors as supplemental measures to evaluate the overall operating performance of companies in our industry. By providing these non-GAAP financial measures, together with reconciliations, we believe we are enhancing investors' understanding of our business and our results of operations, as well as assisting investors in evaluating how well we are executing strategic initiatives.

About FleetCor

FleetCor is a leading global provider of fuel cards and workforce payment products to businesses. FleetCor’s payment programs enable businesses to better control employee spending and provide card-accepting merchants with a commercial customer base that can increase their sales and customer loyalty. FleetCor serves commercial accounts in North America, Latin America, Europe, Australia and New Zealand. For more information, please visit www.fleetcor.com.

     
FleetCor Technologies, Inc. and subsidiaries    
Unaudited Consolidated Statements of Income    
(In thousands, except per share amounts)    
                                             
                    Three Months Ended December 31,       Year Ended December 31,    
                    2014     2013       2014     2013    
                    (Unaudited)     (Unaudited)       (Unaudited)          
                                             
Revenues, net         $ 376,697     $ 255,501       $ 1,199,390     $   895,171    
                                             
Expenses:                                      
  Merchant commissions         33,290       17,783         96,254         68,143    
  Processing             56,185       38,604         173,337         134,030    
  Selling               22,642       18,397         75,527         57,346    
  General and administrative         83,659       50,509         205,963         142,283    
  Depreciation and amortization         37,800       24,158         112,361         72,737    
  Other operating, net         (29,501)       -         (29,501)         -    
Operating income           172,622       106,050         565,449         420,632    
  Other (income) expense, net         (1,570)       472         (700)         602    
  Equity method investment loss         4,897       -         8,586         -    
  Interest expense, net         13,228       5,501         28,856         16,461    
  Loss on early extinguishment of debt         15,764       -         15,764         -    
Total other expense           32,319       5,973         52,506         17,063    
Income before income taxes         140,303       100,077         512,943         403,569    
Provision for income taxes         30,763       31,957         144,236         119,068    
Net income             $ 109,540     $ 68,120       $ 368,707     $   284,501    
                                             
Basic earnings per share       $ 1.25     $ 0.83       $ 4.37     $   3.48    
Diluted earnings per share       $ 1.21     $ 0.80       $ 4.24     $   3.36    
                                             
Weighted average shares outstanding:                                
Basic shares               87,877       82,388         84,317         81,793    
Diluted shares             90,240       85,277         86,982         84,655    
                                               
     
FleetCor Technologies, Inc. and subsidiaries    
Consolidated Balance Sheets    
(In thousands, except share and par value amounts)    
                                 
                      December 31, 2014     December 31, 2013    
                      (Unaudited)          
Assets                            
                                 
Current assets:                      
  Cash and cash equivalents         $ 477,069     $ 338,105    
  Restricted cash           135,144       48,244    
  Accounts receivable (less allowance for doubtful accounts of $23,842 and $22,416, respectively)         664,076       573,351    
  Securitized accounts receivable - restricted for securitization investors           675,000       349,000    
  Prepaid expenses and other current assets           74,889       40,062    
  Deferred income taxes           101,451       4,750    
                                 
Total current assets           2,127,629       1,353,512    
                                 
Property and equipment           135,062       111,100    
Less accumulated depreciation and amortization           (61,499)       (57,144)    
                                 
Net property and equipment           73,563       53,956    
                                 
Goodwill                   3,797,445       1,552,725    
Other intangibles, net           2,451,784       871,263    
Equity method investment           141,933       -    
Other assets               72,431       100,779    
                                 
Total assets             $ 8,664,785     $ 3,932,235    
                                 
Liabilities and Stockholders’ Equity                    
                                 
Current liabilities:                    
  Accounts payable         $ 722,714     $ 467,202    
  Accrued expenses           178,375       114,870    
  Customer deposits           476,498       182,541    
  Securitization facility           675,000       349,000    
  Current portion of notes payable and other obligations           749,764       662,439    
  Other current liabilities           84,546       132,846    
                                 
Total current liabilities           2,886,897       1,908,898    
                                 
Notes payable and other obligations, less current portion           2,168,953       474,939    
Deferred income taxes           815,169       249,504    
Other noncurrent liabilities           40,629       55,001    
                                 
Total noncurrent liabilities           3,024,751       779,444    
                                 
Commitments and contingencies                    
                                 
Stockholders’ equity:                    
 

Common stock, $0.001 par value; 475,000,000 shares authorized, 119,771,155 shares issued

                 
 

and 91,662,043 shares outstanding at December 31, 2014; and 475,000,000 shares

                 
 

authorized, 118,206,262 shares issued and 82,471,770 shares outstanding

                 
 

at December 31, 2013

        120       117    
  Additional paid-in capital           1,852,442       631,667    
  Retained earnings           1,403,905       1,035,198    
  Accumulated other comprehensive loss           (156,933)       (47,426)    
 

Less treasury stock,28,109,112 shares at December 31, 2014 and 35,734,492

                     
 

shares at December 31, 2013

        (346,397)       (375,663)    
                                 
Total stockholders’ equity           2,753,137       1,243,893    
                                 
Total liabilities and stockholders’ equity         $ 8,664,785     $ 3,932,235    
                         
             
FleetCor Technologies, Inc. and Subsidiaries    
Consolidated Statements of Cash Flows    
(In Thousands)    
        Year Ended December 31,    
          2014         2013    
        (Unaudited)            
Operating activities                    
Net income       $ 368,707       $ 284,501    
Adjustments to reconcile net income to net cash provided by operating activities:                    
                         
Depreciation         21,097         16,885    
Stock-based compensation         37,649         26,676    
Provision for losses on accounts receivable         24,412         18,867    
Amortization of deferred financing costs         2,796         3,276    
Loss on extinguishment of debt         15,764         -    
Amortization of intangible assets         86,149         49,313    
Amortization of premium on receivables         3,259         3,263    
Deferred income taxes         (809)         (5,453)    
Equity method investment loss         8,586         -    
Fair value adjustment for contingent consideration arrangements         (27,501)         -    
Changes in operating assets and liabilities (net of acquisitions):                    
Restricted cash         6,625         5,430    
Accounts receivable         256,185         (45,005)    
Prepaid expenses and other current assets         (1,141)         (74)    
Other assets         16,416         38,906    
Excess tax benefits related to stock-based compensation         (56,790)         (32,535)    
Accounts payable, accrued expenses and customer deposits         (153,070)         11,635    
Net cash provided by operating activities         608,334         375,685    
                     
                     
Investing activities                    
Acquisitions and investments, net of cash acquired         (2,567,017) 1       (728,343)    
Purchases of property and equipment         (27,070)         (20,785)    
Net cash used in investing activities         (2,594,087)         (749,128)    
                     
                     
Financing activities                    
Excess tax benefits related to stock-based compensation         56,790         32,535    
Proceeds from issuance of common stock         29,641         30,438    
Borrowings on securitization facility, net         326,000         51,000    
Deferred financing costs paid and debt discounts         (43,943)         (1,970)    
Principal payments on notes payable         (546,875)         (28,125)    
Proceeds from notes payable         2,320,000         -    
Borrowings on revolver-A Facility         807,330         783,663    
Payments on revolver-A Facility         (783,600)         (261,516)    
Borrowings on foreign revolver-B Facility         -         16,715    
Payments on foreign revolver-B Facility         (7,337)         (8,552)    
Payments on acquired debt                 (164,083)    
Borrowings from swing line of credit, net         4,990            
Other         (731)         (14,380)    
Net cash provided by financing activities         2,162,265         435,725    
                     
Effect of foreign currency exchange rates on cash         (37,548)         (7,826)    
                     
Net increase in cash and cash equivalents         138,964         54,456    
Cash and cash equivalents, beginning of year         338,105         283,649    
Cash and cash equivalents, end of year       $ 477,069       $ 338,105    
                     
Supplemental cash flow information                    
Cash paid for interest       $ 29,098       $ 25,886    
                     
Cash paid for income taxes       $ 79,124       $ 99,308    
                     
1Amounts reported in acquisitions and investments, net of cash acquired, includes debt assumed and immediately repaid in acquisitions.
 
     
Exhibit 1    
RECONCILIATION OF NON-GAAP MEASURES    
(In thousands, except shares and per share amounts)    
(Unaudited)    
                               
The following table reconciles revenues, net to adjusted revenues:                    
                               
          Three Months Ended December 31,     Year Ended December 31,    
          2014   2013     2014     2013    
                               
Revenues, net         $ 376,697   $ 255,501     $   1,199,390     $ 895,171    
Merchant commissions           33,290     17,783         96,254       68,143    
Total adjusted revenues         $ 343,407   $ 237,718     $   1,103,136     $ 827,028    
                               
                               
The following table reconciles net income to Adjusted EBITDA:                            
                               
          Three Months Ended December 31,     Year Ended December 31,    
          2014   2013     2014     2013    
                               
Net income         $ 109,540   $ 68,120     $   368,707     $ 284,501    
Provision for income taxes           30,763     31,957         144,236       119,068    
Interest expense, net           13,228     5,501         28,856       16,461    
Depreciation and amortization           37,800     24,158         112,361       72,737    
Other expense, net           (1,570)     472         (700)       602    
Equity method investment loss           4,897     -         8,586       -    
Loss on extinguishment of debt           15,764     -         15,764       -    
Adjusted EBITDA         $ 210,422   $ 130,208     $   677,810     $ 493,369    
                               
                               
The following table reconciles net income to adjusted net income and adjusted net income per diluted share:                
                               
          Three Months Ended December 31,     Year Ended December 31,    
          2014   2013     2014     2013    
Net income         $ 109,540   $ 68,120     $   368,707     $ 284,501    
                               
Stock based compensation           11,357     14,235         37,649       26,676    
Amortization of intangible assets           30,412     17,778         86,149       49,313    
Amortization of premium on receivables           814     815         3,259       3,263    
Amortization of deferred financing costs           1,197     842         2,796       3,276    
Amortization of intangibles at equity method investment           2,824     -         7,982       -    
Loss on extinguishment of debt           15,764     -         15,764       -    
Other non-cash adjustments           (28,869)     -         (28,869)       -    
                               
Total pre-tax adjustments           33,499     33,670         124,730       82,528    
                               
Income tax impact of pre-tax adjustments at the effective tax rate1         (17,217)     (9,712)         (45,767)       (24,349)    
                               
Adjusted net income         $ 125,822   $ 92,078     $   447,670     $ 342,680    
Adjusted net income per diluted share         $ 1.39   $ 1.08     $   5.15     $ 4.05    
                               
Diluted shares           90,240     85,277         86,982       84,655    
                                         
1The effective tax rate used to calculate the income tax impact of pre-tax adjustments excludes the impact of a $9.5 million discrete tax benefit, as well as other non-cash adjustments and their related income tax expense.
 
Exhibit 2    
Transaction Volume, Revenues and Adjusted Revenue, Per Transaction and by Segment    
(In thousands except revenues, net per transaction and adjusted revenues per transaction)    
(Unaudited)    
                                                             
            Three Months Ended December 31,     Year Ended December 31,    
            2014     2013     Change     % Change     2014     2013     Change     % Change    
                                                             
 

NORTH AMERICA

                                                         
  - Transactions2         330,471     42,262     288,209     682.0%       458,865     164,953     293,912     178.2%    
  - Revenues, net per transaction         $ 0.75     $ 2.97     $ (2.22)     -74.8%       $ 1.46     $ 2.79     $ (1.34)     -47.9%    
  - Revenues, net         $ 246,749     $ 125,359     $ 121,390     96.8%       $ 668,328     $ 460,705     $ 207,623     45.1%    
                                                             
 

INTERNATIONAL

                                                         
  - Transactions         48,623     47,817     806     1.7%       192,489     162,563     29,926     18.4%    
  - Revenues, net per transaction         $ 2.67     $ 2.72     $ (0.05)     -1.8%       $ 2.76     $ 2.67     $ 0.09     3.2%    
  - Revenues, net         $ 129,948     $ 130,142     $ (194)     -0.1%       $ 531,062     $ 434,466     $ 96,596     22.2%    
                                                             
                                                             
 

FLEETCOR CONSOLIDATED REVENUES

                                                         
  - Transactions2         379,094     90,079     289,015     320.8%       651,354     327,516     323,838     98.9%    
  - Revenues, net per transaction         $ 0.99     $ 2.84     $ (1.84)     -65.0%       $ 1.84     $ 2.73     $ (0.89)     -32.6%    
  - Revenues, net         $ 376,697     $ 255,501     $ 121,196     47.4%       $ 1,199,390     $ 895,171     $ 304,219     34.0%    
                                                             
                                                             
                                                             
 

FLEETCOR CONSOLIDATED ADJUSTED REVENUES1

                                                 
  - Transactions2         379,094     90,079     289,015     320.8%       651,354     327,516     323,838     98.9%    
  - Adjusted Revenues per transaction         $ 0.91     $ 2.64     $ (1.73)     -65.7%       $ 1.69     $ 2.53     $ (0.83)     -32.9%    
  - Adjusted Revenues         $ 343,407     $ 237,718     $ 105,689     44.5%       $ 1,103,136     $ 827,028     $ 276,108     33.4%    
                                                             
1Adjusted revenues is a non-GAAP financial measure defined as revenues, net less merchant commissions. The Company believes this measure is a more effective way to evaluate the Company's revenue performance. Refer to Exhibit 1 for a reconciliation of revenues, net to adjusted revenues.
 
2Includes approximately 270 million transactions related to our SVS business acquired with Comdata in 2014.
 

Sources of Revenue3

                                                           
        Three Months Ended December 31,       Year Ended December 31,    
        2014     2013     Change     % Change       2014     2013     Change     % Change    
Revenue from customers and partners       54.8%     56.8%     -2.0%     -3.5%           54.9%     53.6%     1.3%     2.4%    
Revenue from merchants and networks       45.2%     43.2%     2.0%     4.6%           45.1%     46.4%     -1.3%     -2.8%    
                                                             
Revenue tied to fuel-price spreads       19.7%     13.6%     6.1%     44.9%           16.5%     15.7%     0.8%     5.1%    
Revenue influenced by absolute price of fuel       14.6%     18.3%     -3.7%     -20.2%           17.0%     19.6%     -2.6%     -13.3%    
Revenue from program fees, late fees, interest and other       65.7%     68.1%     -2.4%     -3.5%           66.5%     64.7%     1.8%     2.8%    
                                                             

3Expressed as a percentage of consolidated revenue, net.

                                             
                                               
     
Exhibit 3    
Segment Results    
(In thousands)    
(Unaudited)    
                                 
            Three Months Ended December 31,     Year Ended December 31,    
            2014   2013     2014     2013    
Revenues, net:1                              
  North America       $ 246,749   $ 125,359     $ 668,328     $   460,705    
  International           129,948     130,142       531,062         434,466    
            $ 376,697   $ 255,501     $ 1,199,390     $   895,171    
                                 
Operating income:1                              
  North America       $ 83,992   $ 51,904     $ 287,303     $   220,526    
  International           88,630     54,146       278,146         200,106    
            $ 172,622   $ 106,050     $ 565,449     $   420,632    
                                 
Depreciation and amortization:1                            
  North America       $ 19,628   $ 6,669     $ 39,275     $   22,267    
  International           18,172     17,489       73,086         50,470    
            $ 37,800   $ 24,158     $ 112,361     $   72,737    
                                 
Capital expenditures:1                            
  North America       $ 4,010   $ 1,834     $ 9,407     $   6,132    
  International           4,781     3,603       17,663         14,653    
            $ 8,791   $ 5,437     $ 27,070     $   20,785    
                                           
1The results from our Comdata business acquired during the fourth quarter of 2014 are presented with our North American segment.
 
   
Exhibit 4  
FLEETCOR, COMDATA AND UNUSUAL ADJUSTMENTS STATEMENT OF INCOME (NON-GAAP)  
(In thousands)  
(Unaudited)  
                                     
                                     
  The purpose of the following table is to present the results of FleetCor Technologies, Inc. ("FleetCor") on a proforma basis, assuming the Comdata, Inc. ("Comdata") acquisition did not occur, and excluding the impact of unusual adjustments. The Comdata column shows the results of operations for the business for the period of time that Fleetcor owned the business during 2014. Also included in the Comdata column are all deal related expenses, incremental interest expense, and purchase accounting amoritization of intangibles related to the acquisition of Comdata and includes the dilutive effective of the incremental shares issued. The unusual adjustments column relates to amounts recorded during the period related to the consideration paid for the Company's acquisitions of DB and VB in Brazil.  
                                     
      Three Months Ended December 31,  
      2014     2013   % Change  
     

FleetCor Technologies,
Inc.

  Comdata, Inc.   Unusual Adjustments   Total            
                                     
Revenues, net   $ 306,858     $ 69,839     $ -     $ 376,697     $ 255,501   47%  
Operating expenses   156,831     76,113 1   (28,869) 7   204,075     149,451   37%  
Total other expense   7,610     24,709 2   -     32,319     5,973   441%  
Income (loss) before income taxes   142,417     (30,983)     28,869     140,303     100,077   40%  
Provision for income taxes   42,630     (11,866) 3   (1) 8   30,763     31,957   -4%  
Net income     $ 99,787     $ (19,117)     $ 28,870     $ 109,540     $ 68,120   61%  
                                     
Proforma diluted shares   86,261 4   90,240 5   90,240 5   90,240 5   85,277   6%  
                                     
Net income (loss) per proforma diluted share   $ 1.16     $ (0.21)     $ 0.32     $ 1.21 9   $ 0.80   52%  
                                     
Adjusted net income   $ 125,116     $ 705     $ 1     $ 125,822     $ 92,078   37%  
                                     
Adjusted net income per proforma diluted share   $ 1.45     $ 0.01     $ -     $ 1.46 10   $ 1.08   35%  
Dilutive impact of shares issued with acquisition   -     (0.06) 6   -     (0.06)     -      
Net adjusted net income per proforma diluted share12   $ 1.45     $ (0.06)     $ -     $ 1.39 11   $ 1.08   29%  
                                   
1Includes the impact of all deal related fees incurred by FleetCor Technologies, Inc. for the acquisition of Comdata of approximately $25.0 million.
 
2Includes the impact of the loss on extinguishment of debt of $15.8 million and incremental interest expense incurred of $8.9 million, calculated as the excess interest expense over what would have been incurred had incremental borrowings not been made, by FleetCor Technologies, Inc. in connection with the acquisition of Comdata, Inc.
 
3Calculated using the marginal tax rate for Comdata, Inc. of 38.3%.
 
4Represents diluted shares of FleetCor Technologies, Inc. excluding the weighted average impact of the issuance of 7,625,380 common shares issued on November 14, 2014 for consideration for the acquisition of Comdata, Inc.
 
5Represents diluted shares of FleetCor Technologies, Inc. inclusive of the weighted average impact of the issuance of 7,625,380 common shares issued on November 14, 2014 for consideration for the acquisition of Comdata, Inc.
 
6Represents the weighted average impact of the issuance of 7,625,380 common shares issued for consideration for the acquisition of Comdata, Inc. on the calculation of adjusted net income per proforma diluted share of FleetCor Technologies, Inc. results for the three months ended December 31, 2014.
 
7Represents the favorable impact of fair value adjustments recorded related to contingent consideration arrangements for the Company's acquisition of VB in Brazil of $28.1 million, partially offset by local tax incurred on financial transactions of $0.6 million related to the fair value adjustments. Adjustment also includes the net favorable impact of the reversal of other various contingent liabilities of approximately $1.4 million.
 
8Represents tax on the gain from the fair value adjustments recorded related to contingent consideration arrangements for the Company's acquisition of VB in Brazil of approximately $9.5 million, offset by the favorable tax impact of te reversal of a tax reserve set up in conjunction with the Company's acquisition of DB in Brazil of $9.5 million.
 
9Row does not calculate across due to the weighted average impact of dilution of the issuance of 7,625,380 common shares, transferred from treasury, for consideration for the acquisition of Comdata, Inc. Net income per proforma dilutive share, inclusive of dilution, may not calculate precisely due to the impact of rounding.
 
10Calculated as adjusted net income per diluted share by column added across. Excludes the weighted average impact of dilution of the issuance of 7,625,380 common shares, transferred from treasury, for consideration for the acquisition of Comdata, Inc.
 
11Represents the adjusted net income per diluted share calculated for the consolidated financial results of FleetCor Technologies, Inc. Includes the weighted average impact of dilution of the issuance of 7,625,380 common shares, transferred from treasury, for consideration for the acquisition of Comdata, Inc. Column may not foot precisely due to the impact of rounding.
 
12May not calculate precisely due to the impact of rounding.
 
   
Exhibit 5  
RECONCILIATION OF FLEETCOR, COMDATA AND UNUSUAL ADJUSTMENTS STATEMENT OF INCOME (NON-GAAP)  
(In thousands)  
(Unaudited)  
                                         
                                         
The following table reconciles net income to adjusted net income, adjusted net income per diluted share and adjusted net income per proforma diluted share for FleetCor, Comdata and adjustments during the period:  
                                         
          Three Months Ended December 31,  
          2014   2013  
         

FleetCor Technologies,
Inc.

    Comdata, Inc.    

Unusual
Adjustments

    Total      
Net income         $ 99,787       $ (19,117)       $ 28,870       $ 109,540   $ 68,120  
                                         
Stock based compensation       11,357       -       -       11,357   14,235  
Amortization of intangible assets       18,796       11,616 1     -       30,412   17,778  
Amortization of premium on receivables       814       -       -       814   815  
Amortization of deferred financing costs       1,197       -       -       1,197   842  
Amortization of intangibles at equity method investment       2,824       -       -       2,824   -  
Loss on extinguishment of debt       -       15,764       -       15,764   -  
Other non-cash adjustments       -       -       (28,869) 3     (28,869)   -  
                                         
Total pre-tax adjustments       34,988       27,380       (28,869)       33,499   33,670  
                                         
Income tax impact of pre-tax adjustments at the effective tax rate2       (9,659)       (7,558)       - 3     (17,217)   (9,712)  
                                         
Adjusted net income       $ 125,116       $ 705       $ 1       $ 125,822   $ 92,078  
Adjusted net income per diluted share       $ 1.39       $ 0.01       $ 0.00       $ 1.39 4 $ 1.08  
                                         
Adjusted net income per proforma diluted share       $ 1.45       $ 0.01       $ 0.00       $ 1.39 5 $ 1.08  
                                         
Dilutive impact of shares issued with acquisition       $ (0.06) 7                            
                                         
Diluted shares       90,240       90,240       90,240       90,240   85,277  
Proforma diluted shares6       86,261 6     90,240       90,240       90,240   85,277  
                                       
 
1Calculation of amortization for acquired intangibles is based on preliminary purchase price allocation.
 
2The effective tax rate used to calculate the income tax impact of pre-tax adjustments excludes the impact of a $9.5 million discrete tax benefit, as well as other non-cash adjustments and their related income tax expense impact. This effective tax rate is used consistently for the calculation of the tax impact of pre-tax adjustments for the results of FleetCor Technologies, Inc. and Comdata, Inc.
 
3As the effective tax rate used to calculate the income tax impact of pre-tax adjustments is inclusive of the effective tax rate impact of 'Adjustments', these amounts are not tax effected again.
 
4 Row does not calculate across due to the weighted average impact of dilution of the issuance of 7,625,380 common shares, transferred from treasury, for consideration for the acquisition of Comdata, Inc. Net income per proforma dilutive share, inclusive of dilution, may not calculate precisely due to the impact of rounding.
 
5Represents the net income per proforma diluted share calculated for the consolidated financial results of FleetCor Technologies, Inc. Row does not calculate across due to the weighted average impact of dilution of the issuance of 7,625,380 common shares, transferred from treasury, for consideration for the acquisition of Comdata, Inc. Net income per proforma dilutive share, inclusive of dilution, may not calculate precisely due to the impact of rounding.
 
6Represents diluted shares of FleetCor Technologies, Inc. excluding the weighted average impact of the issuance of 7,625,380 common shares transferred from treasury shares, on November 14, 2014, for consideration for the acquisition of Comdata, Inc.
 
7Represents the weighted average impact of the issuance of 7,625,380 common shares, transferred from treasury, for consideration for the acquisition of Comdata, Inc. on the calculation of adjusted net income per proforma diluted share of FleetCor Technologies, Inc. results for the three months ended December 31, 2014.
 
  The following table reconciles proforma diluted shares to diluted shares:            
                                   
          Three Months Ended December 31,  
          2014   2013  
         

FleetCor Technologies,
Inc.

 

Comdata, Inc.

  Unusual Adjustments   Total      
                                   
Proforma diluted shares       86,261 1   90,240     90,240     90,240   85,277  
Weighted average impact of issuance of equity      

3,979

2   -     -     -   -  
Diluted shares       90,240     90,240     90,240     90,240   85,277  
                                 
                                 
1Represents diluted shares of FleetCor Technologies, Inc. excluding the weighted average impact of the issuance of 7,625,380 common shares transferred from treasury shares, on November 14, 2014, for consideration for the acquisition of Comdata, Inc.
 
2Represents the weighted average impact of the issuance of 7,625,380 common shares, transferred from treasury, for consideration for the acquisition of Comdata, Inc. on the calculation of diluted shares of FleetCor Technologies, Inc. results for the three months ended December 31, 2014. Acquisition was completed on November 14, 2014.
 

 

Source: FleetCor Technologies, Inc.

FleetCor Technologies, Inc.
Investor Relations, 770-729-2017
investor@fleetcor.com