UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________________________________________
FORM 8-K
________________________________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): February 4, 2021
________________________________________________________
________________________________________________________
(Exact name of registrant as specified in its charter)
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| (State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
| (Address of principal executive offices) | (Zip Code) | |||||||||||||
Registrant’s telephone number, including area code: (770 ) 449-0479
Not Applicable
Former name or former address, if changed since last report
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbols(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On February 4, 2021, FLEETCOR Technologies, Inc. (the "Company") issued a press release announcing its financial results for the three months and year ended December 31, 2020. A copy of the press release is attached as Exhibit 99.1, which is incorporated by reference in its entirety. The information in this item, including Exhibit 99.1, is being furnished, not filed. Accordingly, the information in this item will not be incorporated by reference into any registration statement filed by FLEETCOR Technologies, Inc. under the Securities Act of 1933, as amended, unless specifically identified as being incorporated into it by reference.
Item 7.01 Regulation FD Disclosure.
The Company has made available on its website in the investor relations section an earnings release supplement.
Item 9.01 Financial Statements and Exhibits.
| (d) | Exhibits | ||||
FLEETCOR Technologies, Inc. press release dated February 4, 2021 | |||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL) | ||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| FleetCor Technologies, Inc. | ||||||||||||||||||||
| February 4, 2021 | By: /s/ Charles R. Freund | |||||||||||||||||||
| Charles R. Freund | ||||||||||||||||||||
| Chief Financial Officer | ||||||||||||||||||||
Exhibit Index
| Exhibit No. | Description | |||||||
Press release dated February 4, 2021. | ||||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL). | |||||||
Exhibit 99.1
FLEETCOR Reports Fourth Quarter and Fiscal Year 2020 Financial Results
Atlanta, Ga., February 4, 2021 — FLEETCOR Technologies, Inc. (NYSE: FLT), a global leader in business payments, today reported financial results for its fourth quarter and year ended December 31, 2020.
“Q4 finished better than expected, with improving trends across the board. Our 2021 set up looks good, with the potential for high-teens revenue and profit growth from Q2 on,” said Ron Clarke, chairman and chief executive officer, FLEETCOR Technologies, Inc. “We are particularly excited about our SMB online bill pay acquisition, which creates the opportunity to accelerate both our Corporate Payments and Fuel card growth over the mid-term,” Clarke continued.
Financial Results for Fourth Quarter of 2020:
GAAP Results
•Revenues decreased 12% to $617.3 million in the fourth quarter of 2020, compared with $698.9 million in the fourth quarter of 2019.
•Net income decreased 11% to $209.9 million in the fourth quarter of 2020, compared with $235.5 million in the fourth quarter of 2019.
•Net income per diluted share decreased 6% to $2.44 in the fourth quarter of 2020, compared with $2.60 per diluted share in the fourth quarter of 2019.
Non-GAAP Results1
•Adjusted net income1 decreased 10% to $258.4 million in the fourth quarter of 2020, compared with $286.4 million in the fourth quarter of 2019.
•Adjusted net income per diluted share1 decreased 5% to $3.01 in the fourth quarter of 2020, compared with $3.17 per diluted share in the fourth quarter of 2019.
Financial Results for Fiscal Year 2020:
GAAP Results
•Revenues decreased 10% to $2,388.9 million in 2020, compared with $2,648.8 million in 2019.
•Net income decreased 21% to $704.2 million in 2020, compared with $895.1 million in 2019.
•Net income per diluted share decreased 18% to $8.12 in 2020, compared with $9.94 per diluted share in 2019.
Non-GAAP Results1
•Adjusted net income1 decreased 9% to $962.2 million in 2020, compared with $1,062.1 million in 2019.
•Adjusted net income per diluted share1 decreased 6% to $11.09 in 2020, compared with $11.79 in 2019.
Fiscal Year 2021 Outlook:
“Clearly there is still tremendous uncertainty on the path and pace of recovery for 2021, much of it predicated on widespread vaccinations and a corresponding economic recovery. Based on what we know today, and our expectation that activity will continue to improve throughout the year, our outlook for 2021 is for organic revenue growth to be in the 9% to 13% range, and adjusted net income to be up a corresponding amount, excluding acquisitions. Our assumption underlying these expectations is that the soft, COVID-driven operating environment will continue for most of the first half of 2021, and then improve meaningfully in the second half of the year. We also expect that expenses will be higher than our 2020 levels, but we will continue to manage them in line with revenue growth,” said Charles Freund, chief financial officer, FLEETCOR Technologies, Inc.
For fiscal year 2021, FLEETCOR’s financial outlook is as follows:
•Total revenues to be between $2,600 million and $2,700 million;
•GAAP net income to be between $810 million and $890 million;
•GAAP net income per diluted share to be between $9.40 and $10.20;
•Adjusted net income to be between $1,020 million and $1,110 million;
•Adjusted net income per diluted share to be between $11.90 and $12.70.
FLEETCOR’s outlook assumptions for fiscal year 2021 are as follows:
•Weighted fuel prices equal to $2.43 per gallon average in the U.S.;
•Market spreads significantly unfavorable compared to the 2020 average;
•Foreign exchange rates equal to the average of the four weeks of January, 2021;
•Interest expense between $110 million and $120 million;
•Approximately 87 million fully diluted shares outstanding for 2021;
•An adjusted tax rate of approximately 19.5% to 21.5%; and
•No impact related to acquisitions or material new partnership agreements not already disclosed.
First Quarter of 2020 Outlook:
The Company currently expects that first quarter adjusted net income per diluted share will likely be between $2.60 and $2.80. There is seasonality in the first quarter, causing it to be the lowest in terms of both revenue and net income for the year. The quarter will also be affected by the normalization of certain expenses, and incremental growth investments, including those for the Roger acquisition.
_______________________________________
1 Reconciliations of GAAP results to non-GAAP results are provided in Exhibit 1 attached. Additional supplemental data is provided in Exhibits 2-3 and 5, and segment information is provided in Exhibit 4. A reconciliation of GAAP guidance to non-GAAP guidance is provided in Exhibit 6.
Conference Call:
The Company will host a conference call to discuss fourth quarter and fiscal year 2020 financial results today at 5:30 pm ET. Hosting the call will be Ron Clarke, chief executive officer, Charles Freund, chief financial officer, and Jim Eglseder, senior vice president investor relations. The conference call can be accessed live 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 (844) 512-2921 or (412) 317-6671 for international callers; the conference ID is 13715437. The replay will be available until Thursday, February 17, 2021. The call will be webcast live from the Company's investor relations website at http://investor.fleetcor.com. The Company will post on its website, the customary supplemental financial information that may be discussed during the call.
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, assumptions, 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," or "expect," "may," "will," "would," "could" or "should," the negative of these terms or other comparable terminology.
These forward-looking statements are not a guarantee of performance, and you should not place undue reliance on such statements. We have based these forward-looking statements largely on preliminary information, internal estimates and management assumptions, expectations and plans about future conditions, events and results. Forward-looking statements are subject to many uncertainties and other variable circumstances, such as regulatory measures, voluntary actions, or changes in consumer preferences, that impact our transaction volume, including social distancing, shelter-in-place, shutdowns of nonessential businesses and similar measures imposed or undertaken in an effort to contain and mitigate the spread of the coronavirus (COVID-19); adverse changes or volatility in fuel prices and spreads; adverse changes in program fees or charges we may collect, whether through legal, regulatory or contractual changes; adverse outcomes with respect to current and future legal proceedings or investigations, including without limitation, the FTC lawsuit, or actions of governmental, regulatory or quasi-governmental bodies or standards or industry organizations with respect to our payment cards; delays or failures associated with implication of, or adaption to, new technology, changes in credit risk of customers
and associated losses; failure to maintain or renew key business relationships; failure to maintain competitive product offerings; failure to complete, or delays in completing, acquisitions, new partnerships or customer arrangements; and to successfully integrate or otherwise achieve anticipated benefits from such acquisitions, partnerships, and customer arrangements; failure to successfully expand and manage our business internationally; and other risks related to our international operations, including the potential impact to our business as a result of the United Kingdom’s referendum to leave the European Union; the impact of foreign exchange rates on operations, revenues and income; and the failure or compromise of our data centers and other information technology assets; 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, 2019 filed with the Securities and Exchange Commission (“SEC”) on March 2, 2020 and subsequent filings made by us. These factors could cause our actual results and experience to differ materially from any forward-looking statement made herein. The forward-looking statements included in this press release are made only as of the date hereof. The forward-looking statements included in this press release are made only as of the date hereof and we do not undertake, and specifically disclaim, any obligation to update any such statements as a result of new information, future events or developments, except as specifically stated or to the extent required by law. You may access FLEETCOR’s SEC filings for free by visiting the SEC web site at www.sec.gov.
About Non-GAAP Financial Measures:
This press release includes non-GAAP financial measures, which are used by the Company as supplemental measures to evaluate our overall operating performance. The Company’s definitions of the non-GAAP financial measures used herein may differ from similarly titled measures used by others, including within our industry. By providing these non-GAAP financial measures, together with reconciliations to the most directly comparable GAAP financial measures, 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. See the appendix for additional information regarding these non-GAAP financial measures and a reconciliation to the most directly comparable GAAP measure.
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, discounts and intangible assets, amortization of the premium recognized on the purchase of receivables, and our proportionate share of amortization of intangible assets at our equity method investment, and (c) integration and deal related costs, and (d) other non-recurring items, including unusual credit losses occurring largely due to COVID-19, the impact of discrete tax items, impairment charges, asset write-offs, restructuring costs, gains due to disposition of assets and a business, loss on extinguishment of debt, and legal settlements. We calculate adjusted net income and adjusted net income per diluted share to eliminate the effect of items that we do not consider indicative of our core operating performance.
Adjusted net income and adjusted net income per diluted share are supplemental measures of operating performance that do not represent and should not be considered as an alternative to net income, net income per diluted share or cash flow from operations, as determined by U.S. generally accepted accounting principles, or U.S. GAAP. We believe it is useful to exclude non-cash share 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 share 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 believe that integration and deal related costs and one-time non-recurring expenses, gains, losses, and impairment charges do not necessarily reflect how our investments and business are performing. We adjust net income for the tax effect of each of these non-tax items.
Organic revenue growth is calculated as revenue growth in the current period adjusted for the impact of changes in the macroeconomic environment (to include fuel price, fuel price spreads and changes in foreign exchange rates) over revenue in the comparable prior period adjusted to include or remove the impact of acquisitions and/or divestitures and non-recurring items that have occurred subsequent to that period. We believe that organic revenue growth on a macro-neutral, one-time item, and consistent acquisition/divestiture/non-recurring item basis is useful to investors for understanding the performance of FLEETCOR.
Management uses adjusted net income, adjusted net income per diluted share and organic revenue growth:
•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.
About FLEETCOR:
FLEETCOR Technologies (NYSE: FLT) is a leading global business payments company that simplifies the way businesses manage and pay their expenses. The FLEETCOR portfolio of brands help companies automate, secure, digitize and control payments to, or on behalf of, their employees and suppliers. FLEETCOR serves businesses, partners and merchants in North America, Latin America, Europe, and Asia Pacific. For more information, please visit www.FLEETCOR.com.
Contact
Investor Relations
Jim Eglseder, 770-417-4697
Jim.Eglseder@fleetcor.com
FLEETCOR Technologies, Inc. and Subsidiaries
Consolidated Statements of Income
(In thousands, except per share amounts)
| Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||||||||
| Revenues, net | $ | 617,333 | $ | 698,881 | $ | 2,388,855 | $ | 2,648,848 | ||||||||||||||||||
| Expenses: | ||||||||||||||||||||||||||
| Processing | 121,514 | 146,081 | 596,363 | 530,669 | ||||||||||||||||||||||
| Selling | 47,737 | 51,899 | 192,732 | 204,806 | ||||||||||||||||||||||
| General and administrative | 90,961 | 109,592 | 374,678 | 407,210 | ||||||||||||||||||||||
| Depreciation and amortization | 64,685 | 68,510 | 254,802 | 274,210 | ||||||||||||||||||||||
| Other operating, net | (1,503) | 2,003 | (1,985) | 523 | ||||||||||||||||||||||
| Operating income | 293,939 | 320,796 | 972,265 | 1,231,430 | ||||||||||||||||||||||
| Investment (gain) loss | — | (12,190) | (30,008) | 3,470 | ||||||||||||||||||||||
| Other expense (income), net | 422 | (535) | (10,055) | 93 | ||||||||||||||||||||||
| Interest expense, net | 30,329 | 34,960 | 129,803 | 150,048 | ||||||||||||||||||||||
| Total other expense | 30,751 | 22,235 | 89,740 | 153,611 | ||||||||||||||||||||||
| Income before income taxes | 263,188 | 298,561 | 882,525 | 1,077,819 | ||||||||||||||||||||||
| Provision for income taxes | 53,337 | 63,051 | 178,309 | 182,746 | ||||||||||||||||||||||
| Net income | $ | 209,851 | $ | 235,510 | $ | 704,216 | $ | 895,073 | ||||||||||||||||||
| Basic earnings per share | $ | 2.51 | $ | 2.72 | $ | 8.38 | $ | 10.36 | ||||||||||||||||||
| Diluted earnings per share | $ | 2.44 | $ | 2.60 | $ | 8.12 | $ | 9.94 | ||||||||||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||||||||
| Basic shares | 83,514 | 86,600 | 84,005 | 86,401 | ||||||||||||||||||||||
| Diluted shares | 85,846 | 90,427 | 86,719 | 90,070 | ||||||||||||||||||||||
FLEETCOR Technologies, Inc. and Subsidiaries
Consolidated Balance Sheets
(In thousands, except share and par value amounts)
| December 31, 2020 | December 31, 2019 | |||||||||||||
| (Unaudited) | ||||||||||||||
| Assets | ||||||||||||||
| Current assets: | ||||||||||||||
| Cash and cash equivalents | $ | 934,900 | $ | 1,271,494 | ||||||||||
| Restricted cash | 541,719 | 403,743 | ||||||||||||
| Accounts and other receivables (less allowance for credit losses of $79,112 and $70,890 at December 31, 2020 and 2019, respectively) | 1,366,775 | 1,568,961 | ||||||||||||
| Securitized accounts receivable — restricted for securitization investors | 700,000 | 970,973 | ||||||||||||
| Prepaid expenses and other current assets | 412,924 | 403,400 | ||||||||||||
| Total current assets | 3,956,318 | 4,618,571 | ||||||||||||
| Property and equipment, net | 202,509 | 199,825 | ||||||||||||
| Goodwill | 4,719,181 | 4,833,047 | ||||||||||||
| Other intangibles, net | 2,115,882 | 2,341,882 | ||||||||||||
| Investments | 7,480 | 30,440 | ||||||||||||
| Other assets | 193,209 | 224,776 | ||||||||||||
| Total assets | $ | 11,194,579 | $ | 12,248,541 | ||||||||||
| Liabilities and Stockholders’ Equity | ||||||||||||||
| Current liabilities: | ||||||||||||||
| Accounts payable | $ | 1,054,478 | $ | 1,249,586 | ||||||||||
| Accrued expenses | 282,681 | 275,511 | ||||||||||||
| Customer deposits | 1,175,322 | 1,007,631 | ||||||||||||
| Securitization facility | 700,000 | 970,973 | ||||||||||||
| Current portion of notes payable and lines of credit | 505,697 | 775,865 | ||||||||||||
| Other current liabilities | 250,133 | 183,502 | ||||||||||||
| Total current liabilities | 3,968,311 | 4,463,068 | ||||||||||||
| Notes payable and other obligations, less current portion | 3,126,926 | 3,289,947 | ||||||||||||
| Deferred income taxes | 498,154 | 519,980 | ||||||||||||
| Other noncurrent liabilities | 245,777 | 263,930 | ||||||||||||
| Total noncurrent liabilities | 3,870,857 | 4,073,857 | ||||||||||||
| Commitments and contingencies | ||||||||||||||
| Stockholders’ equity: | ||||||||||||||
| Common stock, $0.001 par value; 475,000,000 shares authorized; 126,448,078 shares issued and 83,666,163 shares outstanding at December 31, 2020; and 124,626,786 shares issued and 85,342,156 shares outstanding at December 31, 2019 | 126 | 124 | ||||||||||||
| Additional paid-in capital | 2,749,900 | 2,494,721 | ||||||||||||
| Retained earnings | 5,416,945 | 4,712,729 | ||||||||||||
| Accumulated other comprehensive loss | (1,363,158) | (972,465) | ||||||||||||
| Less treasury stock, 42,781,915 shares and 39,284,630 shares at December 31, 2020 and 2019, respectively | (3,448,402) | (2,523,493) | ||||||||||||
| Total stockholders’ equity | 3,355,411 | 3,711,616 | ||||||||||||
| Total liabilities and stockholders’ equity | $ | 11,194,579 | $ | 12,248,541 | ||||||||||
FLEETCOR Technologies, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(In thousands)
| Year Ended December 31, | ||||||||||||||
| 2020 | 2019 | |||||||||||||
| (Unaudited) | ||||||||||||||
| Operating activities | ||||||||||||||
| Net income | $ | 704,216 | $ | 895,073 | ||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||
| Depreciation | 65,181 | 62,784 | ||||||||||||
| Stock-based compensation | 43,384 | 60,953 | ||||||||||||
| Provision for losses on accounts receivable and other receivables | 158,549 | 74,309 | ||||||||||||
| Amortization of deferred financing costs and discounts | 6,486 | 5,106 | ||||||||||||
| Amortization of intangible assets and premium on receivables | 189,620 | 211,426 | ||||||||||||
| Deferred income taxes | 147,058 | 37,883 | ||||||||||||
| Investment (gain) loss | (30,008) | 3,470 | ||||||||||||
| Loss on write-off of fixed assets | 294 | 1,819 | ||||||||||||
| Other non-cash operating income | (2,279) | (1,297) | ||||||||||||
| Changes in operating assets and liabilities (net of acquisitions/dispositions): | ||||||||||||||
| Accounts and other receivables | 264,140 | (196,028) | ||||||||||||
| Prepaid expenses and other current assets | (14,521) | (185,391) | ||||||||||||
| Other assets | 12,656 | (6,792) | ||||||||||||
| Accounts payable, accrued expenses and customer deposits | (77,079) | 198,756 | ||||||||||||
| Net cash provided by operating activities | 1,467,697 | 1,162,071 | ||||||||||||
| Investing activities | ||||||||||||||
| Acquisitions, net of cash acquired | (80,787) | (448,277) | ||||||||||||
| Purchases of property and equipment | (78,425) | (75,170) | ||||||||||||
| Proceeds from disposal of investment | 52,963 | — | ||||||||||||
| Other | — | (255) | ||||||||||||
| Net cash used in investing activities | (106,249) | (523,702) | ||||||||||||
| Financing activities | ||||||||||||||
| Proceeds from issuance of common stock | 136,797 | 168,925 | ||||||||||||
| Repurchase of common stock | (849,910) | (694,909) | ||||||||||||
| (Payments) borrowings on securitization facility, net | (270,973) | 84,973 | ||||||||||||
| Deferred financing costs paid and debt discount | (2,637) | (2,868) | ||||||||||||
| Proceeds from issuance of notes payable | — | 700,000 | ||||||||||||
| Principal payments on notes payable | (175,285) | (138,500) | ||||||||||||
| Borrowings from revolver | 1,243,500 | 1,811,509 | ||||||||||||
| Payments on revolver | (1,496,907) | (2,292,349) | ||||||||||||
| (Payments) borrowings on swing line of credit, net | (1,042) | 52,996 | ||||||||||||
| Other | (344) | 52 | ||||||||||||
| Net cash used in financing activities | (1,416,801) | (310,171) | ||||||||||||
| Effect of foreign currency exchange rates on cash | (143,265) | (17,854) | ||||||||||||
| Net (decrease) increase in cash and cash equivalents and restricted cash | (198,618) | 310,344 | ||||||||||||
| Cash and cash equivalents and restricted cash, beginning of year | 1,675,237 | 1,364,893 | ||||||||||||
| Cash and cash equivalents and restricted cash, end of year | $ | 1,476,619 | $ | 1,675,237 | ||||||||||
| Supplemental cash flow information | ||||||||||||||
| Cash paid for interest | $ | 126,460 | $ | 178,417 | ||||||||||
| Cash paid for income taxes | $ | 165,604 | $ | 200,525 | ||||||||||
Exhibit 1
RECONCILIATION OF NON-GAAP MEASURES
(In thousands, except shares and per share amounts)
(Unaudited)
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, | ||||||||||||||||||||||||||||
| 2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||||||||
| Net income | $ | 209,851 | $ | 235,510 | $ | 704,216 | $ | 895,073 | |||||||||||||||||||||
| Stock based compensation | 8,315 | 14,833 | 43,384 | 60,953 | |||||||||||||||||||||||||
| Amortization of intangible assets, premium on receivables, deferred financing costs and discounts | 49,111 | 53,484 | 196,106 | 216,532 | |||||||||||||||||||||||||
| Investment (gain) loss | — | (12,955) | (30,008) | 2,705 | |||||||||||||||||||||||||
| Loss on write-off of fixed assets | 294 | 1,819 | 294 | 1,819 | |||||||||||||||||||||||||
Integration and deal related costs1 | 985 | — | 12,020 | — | |||||||||||||||||||||||||
| Restructuring and related costs | (697) | 2,814 | 4,215 | 2,814 | |||||||||||||||||||||||||
| Legal settlements/litigation | 2,845 | 2,707 | (144) | 6,181 | |||||||||||||||||||||||||
Write-off of customer receivable2 | — | — | 90,058 | — | |||||||||||||||||||||||||
| Total pre-tax adjustments | 60,853 | 62,702 | 315,926 | 291,004 | |||||||||||||||||||||||||
Income tax impact of pre-tax adjustments at the effective tax rate3 | (12,332) | (12,596) | (67,762) | (61,619) | |||||||||||||||||||||||||
Impact of discrete tax item4 | — | 765 | 9,848 | (62,333) | |||||||||||||||||||||||||
| Adjusted net income | $ | 258,372 | $ | 286,380 | $ | 962,228 | $ | 1,062,125 | |||||||||||||||||||||
| Adjusted net income per diluted share | $ | 3.01 | $ | 3.17 | $ | 11.09 | $ | 11.79 | |||||||||||||||||||||
| Diluted shares | 85,846 | 90,427 | 86,719 | 90,070 | |||||||||||||||||||||||||
1 Beginning in 2020, the Company included integration and deal related costs in its definition to calculate adjusted net income and adjusted net income per diluted share. Prior period amounts were approximately $0.1 million and $3.9 million for the three months and year ended December 31, 2020, respectively, which we consider immaterial. | ||
2 Represents a bad debt loss in the first quarter of 2020 from a large client in our Cambridge business entering voluntary bankruptcy due to the extraordinary impact of the COVID-19 pandemic. | ||
3 Excludes the results of the Company's investment in 2019, on our effective tax rate, as results from Masternaut investment are reported within the consolidated Statements of Income on a post-tax basis and no tax-over-book outside basis difference prior to disposition. | ||
4 Represents impact of a discrete tax reserve adjustment related to prior year tax positions in 2020 and the impact from the disposition of our investment in Masternaut of $64.1 million in 2019. 2019 also includes the impact of a discrete tax item from a prior year for a Section 199 adjustment of $1.8 million. | ||
| * Columns may not calculate due to rounding. | ||
Exhibit 2
Key Performance Indicators, by Product Category and Revenue Per Performance Metric on a GAAP Basis and Pro Forma and Macro Adjusted
(In millions except revenues, net per key performance metric)
(Unaudited)
| The following table presents revenue and revenue per key performance metric by product category.* | |||||||||||||||||||||||||||||||||||||||||||||||
| As Reported | Pro Forma and Macro Adjusted3 | ||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended December 31, | Three Months Ended December 31, | ||||||||||||||||||||||||||||||||||||||||||||||
| 2020 | 2019 | Change | % Change | 2020 | 2019 | Change | % Change | ||||||||||||||||||||||||||||||||||||||||
FUEL | |||||||||||||||||||||||||||||||||||||||||||||||
'- Revenues, net | $ | 260.2 | $ | 299.3 | $ | (39.1) | (13) | % | $ | 270.4 | $ | 299.3 | $ | (28.9) | (10) | % | |||||||||||||||||||||||||||||||
'- Transactions | 110.4 | 126.4 | (16.0) | (13) | % | 110.4 | 126.4 | (16.0) | (13) | % | |||||||||||||||||||||||||||||||||||||
'- Revenues, net per transaction | $ | 2.36 | $ | 2.37 | $ | (0.01) | — | % | $ | 2.45 | $ | 2.37 | $ | 0.08 | 3 | % | |||||||||||||||||||||||||||||||
| CORPORATE PAYMENTS | |||||||||||||||||||||||||||||||||||||||||||||||
'- Revenues, net1 | $ | 115.0 | $ | 121.4 | $ | (6.5) | (5) | % | $ | 114.4 | $ | 121.4 | $ | (7.1) | (6) | % | |||||||||||||||||||||||||||||||
'- Spend volume | $ | 17,585 | $ | 18,630 | $ | (1,045) | (6) | % | $ | 17,585 | $ | 18,630 | $ | (1,044) | (6) | % | |||||||||||||||||||||||||||||||
'- Revenues, net per spend $ | 0.65 | % | 0.65 | % | $ | — | — | % | 0.65 | % | 0.65 | % | — | % | — | % | |||||||||||||||||||||||||||||||
| TOLLS | |||||||||||||||||||||||||||||||||||||||||||||||
'- Revenues, net | $ | 76.5 | $ | 93.3 | $ | (16.8) | (18) | % | $ | 100.2 | $ | 93.3 | $ | 6.8 | 7 | % | |||||||||||||||||||||||||||||||
| - Tags (average monthly) | 5.6 | 5.3 | 0.4 | 7 | % | 5.6 | 5.3 | 0.4 | 7 | % | |||||||||||||||||||||||||||||||||||||
'- Revenues, net per tag | $ | 13.61 | $ | 17.77 | $ | (4.16) | (23) | % | $ | 17.81 | $ | 17.77 | $ | 0.05 | — | % | |||||||||||||||||||||||||||||||
| LODGING | |||||||||||||||||||||||||||||||||||||||||||||||
'- Revenues, net | $ | 56.6 | $ | 64.2 | $ | (7.6) | (12) | % | $ | 56.6 | $ | 75.0 | $ | (18.4) | (25) | % | |||||||||||||||||||||||||||||||
'- Room nights | 5.8 | 6.4 | (0.6) | (9) | % | 5.8 | 6.4 | (0.6) | (9) | % | |||||||||||||||||||||||||||||||||||||
'- Revenues, net per room night | $ | 9.78 | $ | 10.06 | $ | (0.28) | (3) | % | $ | 9.78 | $ | 11.75 | $ | (1.97) | (17) | % | |||||||||||||||||||||||||||||||
| GIFT | |||||||||||||||||||||||||||||||||||||||||||||||
'- Revenues, net | $ | 46.4 | $ | 47.7 | $ | (1.3) | (3) | % | $ | 46.4 | $ | 47.7 | $ | (1.3) | (3) | % | |||||||||||||||||||||||||||||||
'- Transactions | 331.7 | 381.5 | (49.8) | (13) | % | 331.7 | 381.5 | (49.8) | (13) | % | |||||||||||||||||||||||||||||||||||||
'- Revenues, net per transaction | $ | 0.14 | $ | 0.12 | $ | 0.01 | 12 | % | $ | 0.14 | $ | 0.12 | $ | 0.01 | 12 | % | |||||||||||||||||||||||||||||||
OTHER2 | |||||||||||||||||||||||||||||||||||||||||||||||
'- Revenues, net1 | $ | 62.7 | $ | 72.9 | $ | (10.2) | (14) | % | $ | 64.3 | $ | 72.9 | $ | (8.6) | (12) | % | |||||||||||||||||||||||||||||||
'- Transactions1 | 9.9 | 14.6 | (4.7) | (32) | % | 9.9 | 14.6 | (4.7) | (32) | % | |||||||||||||||||||||||||||||||||||||
'- Revenues, net per transaction | $ | 6.33 | $ | 5.00 | $ | 1.33 | 27 | % | $ | 6.49 | $ | 5.00 | $ | 1.49 | 30 | % | |||||||||||||||||||||||||||||||
| FLEETCOR CONSOLIDATED REVENUES | |||||||||||||||||||||||||||||||||||||||||||||||
'- Revenues, net | $ | 617.3 | $ | 698.9 | $ | (81.5) | (12) | % | $ | 652.2 | $ | 709.7 | $ | (57.4) | (8) | % | |||||||||||||||||||||||||||||||
1 Reflects certain reclassifications of revenue between product categories as the Company realigned its corporate payments business, resulting in reclassification of payroll paycard revenue from corporate payments to other. | ||
2 Other includes telematics, maintenance, food, transportation and payroll card related businesses. | ||
3 See Exhibit 5 for a reconciliation of Pro forma and Macro Adjusted revenue by product and metrics, non-GAAP measures, to the GAAP equivalent. | ||
| * Columns may not calculate due to rounding. | ||
Exhibit 3
Revenues by Geography and Product
(In millions)
(Unaudited)
| Revenue by Geography* | Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| 2020 | % | 2019 | % | 2020 | % | 2019 | % | ||||||||||||||||||||||||||||||||||||||||
| US | $ | 378 | 61 | % | $ | 421 | 60 | % | $ | 1,468 | 61 | % | $ | 1,595 | 60 | % | |||||||||||||||||||||||||||||||
| Brazil | 91 | 15 | % | 111 | 16 | % | 344 | 14 | % | 428 | 16 | % | |||||||||||||||||||||||||||||||||||
| UK | 70 | 11 | % | 71 | 10 | % | 263 | 11 | % | 275 | 10 | % | |||||||||||||||||||||||||||||||||||
| Other | 79 | 13 | % | 96 | 14 | % | 314 | 13 | % | 351 | 13 | % | |||||||||||||||||||||||||||||||||||
| Consolidated Revenues, net | $ | 617 | 100 | % | $ | 699 | 100 | % | $ | 2,389 | 100 | % | $ | 2,649 | 100 | % | |||||||||||||||||||||||||||||||
*Columns may not calculate due to rounding.
Revenue by Product Category*1 | Three Months Ended December 31, | Year ended Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| 2020 | % | 2019 | % | 2020 | % | 2019 | % | ||||||||||||||||||||||||||||||||||||||||
| Fuel | $ | 260 | 42 | % | $ | 299 | 43 | % | $ | 1,057 | 44 | % | $ | 1,173 | 44 | % | |||||||||||||||||||||||||||||||
| Corporate Payments | 115 | 19 | % | 121 | 17 | % | 434 | 18 | % | 450 | 17 | % | |||||||||||||||||||||||||||||||||||
| Tolls | 77 | 12 | % | 93 | 13 | % | 292 | 12 | % | 357 | 13 | % | |||||||||||||||||||||||||||||||||||
| Lodging | 57 | 9 | % | 64 | 9 | % | 207 | 9 | % | 213 | 8 | % | |||||||||||||||||||||||||||||||||||
| Gift | 46 | 8 | % | 48 | 7 | % | 154 | 6 | % | 180 | 7 | % | |||||||||||||||||||||||||||||||||||
| Other | 63 | 10 | % | 73 | 10 | % | 244 | 10 | % | 276 | 10 | % | |||||||||||||||||||||||||||||||||||
| Consolidated Revenues, net | $ | 617 | 100 | % | $ | 699 | 100 | % | $ | 2,389 | 100 | % | $ | 2,649 | 100 | % | |||||||||||||||||||||||||||||||
*Columns may not calculate due to rounding.
1 Reflects certain reclassifications of revenue between product categories as the Company realigned its corporate payments business, resulting in reclassification of payroll paycard revenue from corporate payments to other. | |||||||||||||||||
Exhibit 4
Segment Results
(In thousands)
| Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||||||||||||
| 2020 | 20191 | 2020 | 20191 | |||||||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||||||||
| Revenues, net: | ||||||||||||||||||||||||||
| North America | $ | 405,597 | $ | 451,002 | $ | 1,581,547 | $ | 1,708,546 | ||||||||||||||||||
| Brazil | 90,526 | 112,067 | 344,248 | 427,921 | ||||||||||||||||||||||
| International | 121,210 | 135,812 | 463,060 | 512,381 | ||||||||||||||||||||||
| $ | 617,333 | $ | 698,881 | $ | 2,388,855 | $ | 2,648,848 | |||||||||||||||||||
| Operating income: | ||||||||||||||||||||||||||
| North America | $ | 175,693 | $ | 192,298 | $ | 547,912 | $ | 754,528 | ||||||||||||||||||
| Brazil | 43,593 | 48,758 | 148,055 | 175,642 | ||||||||||||||||||||||
| International | 74,653 | 79,740 | 276,298 | 301,260 | ||||||||||||||||||||||
| $ | 293,939 | $ | 320,796 | $ | 972,265 | $ | 1,231,430 | |||||||||||||||||||
| Depreciation and amortization: | ||||||||||||||||||||||||||
| North America | $ | 40,504 | $ | 40,770 | $ | 156,417 | $ | 160,246 | ||||||||||||||||||
| Brazil | 12,345 | 15,622 | 51,364 | 64,936 | ||||||||||||||||||||||
| International | 11,836 | 12,118 | 47,021 | 49,028 | ||||||||||||||||||||||
| $ | 64,685 | $ | 68,510 | $ | 254,802 | $ | 274,210 | |||||||||||||||||||
| Capital expenditures: | ||||||||||||||||||||||||||
| North America | $ | 12,836 | $ | 14,215 | $ | 48,426 | $ | 44,238 | ||||||||||||||||||
| Brazil | 6,807 | 6,057 | 17,116 | 18,330 | ||||||||||||||||||||||
| International | 3,763 | 6,218 | 12,883 | 12,602 | ||||||||||||||||||||||
| $ | 23,406 | $ | 26,490 | $ | 78,425 | $ | 75,170 | |||||||||||||||||||
1 The Company has historically had two reportable segments, North America and International. In the first quarter of 2020, in order to better align with changes in business models and management reporting, the Company has broken out Brazil as a third segment, which was previously reported in the International segment. The presentation of segment information has been recast for the prior quarter and prior year to align with segment presentation in 2020. | |||||||||||||||||||||||||||||
Exhibit 5
Reconciliation of Non-GAAP Revenue and Key Performance Metrics by Product to GAAP
(In millions)
(Unaudited)
| Revenues, net | Key Performance Metric | ||||||||||||||||||||||||||||
| Three Months Ended December 31, | Three Months Ended December 31, | ||||||||||||||||||||||||||||
| 2020* | 2019* | 2020* | 2019* | ||||||||||||||||||||||||||
| FUEL - TRANSACTIONS | |||||||||||||||||||||||||||||
| Pro forma and macro adjusted | $ | 270.4 | $ | 299.3 | 110.4 | 126.4 | |||||||||||||||||||||||
| Impact of acquisitions/dispositions | — | — | — | — | |||||||||||||||||||||||||
| Impact of fuel prices/spread | (6.3) | — | — | — | |||||||||||||||||||||||||
| Impact of foreign exchange rates | (3.9) | — | — | — | |||||||||||||||||||||||||
| As reported | $ | 260.2 | $ | 299.3 | 110.4 | 126.4 | |||||||||||||||||||||||
| CORPORATE PAYMENTS - SPEND | |||||||||||||||||||||||||||||
| Pro forma and macro adjusted | 114.4 | 121.4 | 17,585 | 18,630 | |||||||||||||||||||||||||
| Impact of acquisitions/dispositions | — | — | — | — | |||||||||||||||||||||||||
| Impact of fuel prices/spread | (0.2) | — | — | — | |||||||||||||||||||||||||
| Impact of foreign exchange rates | 0.7 | — | — | — | |||||||||||||||||||||||||
| As reported | 115.0 | 121.4 | 17,585 | 18,630 | |||||||||||||||||||||||||
| TOLLS - TAGS | |||||||||||||||||||||||||||||
| Pro forma and macro adjusted | $ | 100.2 | $ | 93.3 | 5.6 | 5.3 | |||||||||||||||||||||||
| Impact of acquisitions/dispositions | — | — | — | — | |||||||||||||||||||||||||
| Impact of fuel prices/spread | — | — | — | — | |||||||||||||||||||||||||
| Impact of foreign exchange rates | (23.7) | — | — | — | |||||||||||||||||||||||||
| As reported | $ | 76.5 | $ | 93.3 | 5.6 | 5.3 | |||||||||||||||||||||||
| LODGING - ROOM NIGHTS | |||||||||||||||||||||||||||||
| Pro forma and macro adjusted | $ | 56.6 | $ | 75.0 | 5.8 | 6.4 | |||||||||||||||||||||||
| Impact of acquisitions/dispositions | — | (10.8) | — | — | |||||||||||||||||||||||||
| Impact of fuel prices/spread | — | — | — | — | |||||||||||||||||||||||||
| Impact of foreign exchange rates | — | — | — | — | |||||||||||||||||||||||||
| As reported | $ | 56.6 | $ | 64.2 | 5.8 | 6.4 | |||||||||||||||||||||||
| GIFT - TRANSACTIONS | |||||||||||||||||||||||||||||
| Pro forma and macro adjusted | $ | 46.4 | $ | 47.7 | 331.7 | 381.5 | |||||||||||||||||||||||
| Impact of acquisitions/dispositions | — | — | — | — | |||||||||||||||||||||||||
| Impact of fuel prices/spread | — | — | — | — | |||||||||||||||||||||||||
| Impact of foreign exchange rates | — | — | — | — | |||||||||||||||||||||||||
| As reported | $ | 46.4 | $ | 47.7 | 331.7 | 381.5 | |||||||||||||||||||||||
OTHER1- TRANSACTIONS | |||||||||||||||||||||||||||||
| Pro forma and macro adjusted | $ | 64.3 | $ | 72.9 | 9.9 | 14.6 | |||||||||||||||||||||||
| Impact of acquisitions/dispositions | — | — | — | — | |||||||||||||||||||||||||
| Impact of fuel prices/spread | — | — | — | — | |||||||||||||||||||||||||
| Impact of foreign exchange rates | (1.6) | — | — | — | |||||||||||||||||||||||||
| As reported | $ | 62.7 | $ | 72.9 | 9.9 | 14.6 | |||||||||||||||||||||||
| FLEETCOR CONSOLIDATED REVENUES | |||||||||||||||||||||||||||||
| Pro forma and macro adjusted | $ | 652.2 | $ | 709.7 | Intentionally Left Blank | ||||||||||||||||||||||||
| Impact of acquisitions/dispositions | — | (10.8) | |||||||||||||||||||||||||||
Impact of fuel prices/spread2 | (6.5) | — | |||||||||||||||||||||||||||
| Impact of foreign exchange rates | (28.4) | — | |||||||||||||||||||||||||||
| As reported | $ | 617.3 | $ | 698.9 | |||||||||||||||||||||||||
| * Columns may not calculate due to rounding. | |||||||||||||||||||||||||||||
1Other includes telematics, maintenance, food, transportation and payroll card related businesses. | |||||||||||||||||||||||||||||
2 Revenues reflect an estimated $6 million net negative impact of fuel prices and fuel price spreads, where lower fuel prices had an estimated $9 million negative impact and higher fuel spreads had an offsetting $3 million favorable impact. | |||||||||||||||||||||||||||||
Exhibit 6
RECONCILIATION OF NON-GAAP GUIDANCE MEASURES
(In millions, except per share amounts)
(Unaudited)
The following table reconciles first quarter and full year 2021 financial guidance for net income to adjusted net income and adjusted net income per diluted share, at both ends of the range:
| Q1 2021 GUIDANCE | ||||||||||||||
| Low* | High* | |||||||||||||
| Net income | $ | 170 | $ | 190 | ||||||||||
| Net income per diluted share | $ | 2.00 | $ | 2.20 | ||||||||||
| Stock based compensation | 14 | 14 | ||||||||||||
| Amortization of intangible assets, premium on receivables, deferred financing costs and discounts | 48 | 48 | ||||||||||||
| Other | 4 | 4 | ||||||||||||
| Total pre-tax adjustments | 66 | 66 | ||||||||||||
| Income tax impact of pre-tax adjustments | (14) | (14) | ||||||||||||
| Adjusted net income | $ | 222 | $ | 242 | ||||||||||
| Adjusted net income per diluted share | $ | 2.60 | $ | 2.80 | ||||||||||
| Diluted shares | 86 | 86 | ||||||||||||
| 2021 GUIDANCE | ||||||||||||||
| Low* | High* | |||||||||||||
| Net income | $ | 810 | $ | 890 | ||||||||||
| Net income per diluted share | $ | 9.40 | $ | 10.20 | ||||||||||
| Stock based compensation | 71 | 71 | ||||||||||||
| Amortization of intangible assets, premium on receivables, deferred financing costs and discounts | 189 | 189 | ||||||||||||
| Other | 15 | 15 | ||||||||||||
| Total pre-tax adjustments | 275 | 275 | ||||||||||||
| Income tax impact of pre-tax adjustments | (63) | (54) | ||||||||||||
| Adjusted net income | $ | 1,020 | $ | 1,110 | ||||||||||
| Adjusted net income per diluted share | $ | 11.90 | $ | 12.70 | ||||||||||
| Diluted shares | 87 | 87 | ||||||||||||
| * Columns may not calculate due to rounding. | ||||||||||||||