Financial Performance - Consolidated revenue for the three months ended September 30, 2025 was $9.4 billion, a decrease of $1.1 billion, or 10%, compared to the same period in 2024[116]. - Gross profit for the three months ended September 30, 2025 was $249.6 million, a decrease of $18.5 million, or 7%, compared to the same period in 2024[117]. - Total operating expenses for the three months ended September 30, 2025 were $186.8 million, a decrease of $9.1 million, or 5%, compared to the same period in 2024[118]. - Net income attributable to World Kinect for the three months ended September 30, 2025 was $25.7 million, compared to $33.5 million in 2024[116]. - Consolidated revenue for the nine months ended September 30, 2025 was $27.9 billion, a decrease of $4.5 billion, or 14%, compared to the same period in 2024[131]. - Total operating expenses for the nine months ended September 30, 2025 were $1.0 billion, an increase of $414.5 million, or 71%, compared to the same period in 2024[133]. - Net income attributable to World Kinect for the nine months ended September 30, 2025 was $(334.7) million, compared to $169.2 million in 2024[131]. Segment Performance - Revenue in the aviation segment for the three months ended September 30, 2025 was $4.9 billion, a decrease of $350.3 million, or 7%, compared to the same period in 2024[121]. - Revenue in the land segment for the three months ended September 30, 2025 was $2.5 billion, a decrease of $616.0 million, or 20%, compared to the same period in 2024[125]. - Revenue in the marine segment for the three months ended September 30, 2025 was $2.0 billion, a decrease of $132.8 million, or 6%, compared to the same period in 2024[128]. - For the nine months ended September 30, 2025, the aviation segment revenue was $14.2 billion, a decrease of $1.5 billion, or 9%, compared to the same period in 2024[136]. - The aviation segment gross profit increased by $31.2 million, or 9%, to $396.4 million for the nine months ended September 30, 2025, driven by higher contributions from operated airport locations in Europe[137]. - The land segment revenue was $7.8 billion for the nine months ended September 30, 2025, a decrease of $2.0 billion, or 21%, compared to the same period in 2024, primarily due to lower average fuel prices[140]. - The land segment gross profit decreased by $52.2 million, or 19%, to $227.8 million for the nine months ended September 30, 2025, impacted by unfavorable market conditions[141]. - The marine segment revenue was $5.8 billion for the nine months ended September 30, 2025, a decrease of $1.0 billion, or 15%, compared to the same period in 2024, due to lower average prices and decreased volume[143]. - The marine segment gross profit decreased by $34.0 million, or 28%, to $88.2 million for the nine months ended September 30, 2025, primarily due to lower bunker fuel prices[145]. Impairments and Charges - The company recognized asset impairment charges of $3.1 million and wrote off accounts receivable totaling $4.4 million during the three months ended December 31, 2024[102]. - A goodwill impairment charge of $359.0 million was recognized, representing a partial impairment of goodwill in the land reporting unit[167]. - The land segment underwent a reassessment leading to downward revisions in long-term forecasts due to macroeconomic pressures and underperformance against financial expectations[110]. Cost Savings and Restructuring - The company expects to achieve approximately $30 million in annualized compensation-related savings from restructuring actions taken in the first quarter of 2025[103]. - A total of $80 million in cost savings is anticipated over a five-year period from 2026 through 2030 as part of the global finance and accounting optimization initiative[104]. Acquisitions and Sales - The company completed the sale of its U.K. land fuels business for total proceeds of $42.8 million in April 2025[102]. - The company entered into a definitive agreement to acquire Universal Weather and Aviation's Trip Support Services division for approximately $220 million, with $160 million payable at closing[157]. Cash Flow and Financing - For the nine months ended September 30, 2025, net cash provided by operating activities was $258.7 million, an increase of $119.1 million compared to $139.6 million for the same period in 2024[159]. - Net cash used in investing activities for the nine months ended September 30, 2025 was $4.8 million, a decrease from net cash provided of $98.9 million in the same period of 2024, primarily due to capital expenditures of $44.2 million[160]. - Net cash used in financing activities was $163.7 million for the nine months ended September 30, 2025, compared to $162.6 million in the same period of 2024, mainly due to net repayments of debt of $80.7 million[161]. - The company believes that its cash and cash equivalents, along with available funds from its Credit Facility, are sufficient to fund working capital and capital expenditure requirements for at least the next twelve months[149]. Economic and Market Conditions - Inflation in the U.S. decelerated in 2024 as supply chains stabilized, following significant increases driven by supply chain disruptions and labor shortages[112]. - The company anticipates that a significant or prolonged period of trade uncertainty or high inflation could adversely impact its results[114]. - There have been no material changes to the company's exposures to commodity price, interest rate, or foreign currency risk since December 31, 2024[168].

Core Insights - World Kinect (WKC) reported quarterly earnings of $0.54 per share, missing the Zacks Consensus Estimate of $0.61 per share, and down from $0.62 per share a year ago, representing an earnings surprise of -11.48% [1] - The company posted revenues of $9.39 billion for the quarter ended September 2025, missing the Zacks Consensus Estimate by 1.85%, and down from $10.49 billion year-over-year [2] - World Kinect shares have declined approximately 7% year-to-date, contrasting with the S&P 500's gain of 13.9% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.57 on revenues of $9.32 billion, and for the current fiscal year, it is $2.25 on revenues of $37.75 billion [7] - The estimate revisions trend for World Kinect was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Oil and Gas - Refining and Marketing industry, to which World Kinect belongs, is currently in the top 10% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Another company in the same industry, PBF Energy, is expected to report a quarterly loss of $0.68 per share, with a year-over-year change of +54.7%, and its consensus EPS estimate has been revised 19.7% higher over the last 30 days [9][10]

Financial Data and Key Metrics Changes - In Q3 2025, consolidated volume was 4.3 billion gallons, down 4% year-over-year, and consolidated gross profit declined 7% to $250 million [12][18] - Operating expenses were $181 million, down 7% year-over-year, reflecting effective cost management [18][20] - Adjusted effective tax rate for Q3 was 27%, slightly higher year-over-year, with expectations for Q4 to remain in the range of 26%-28% [19][20] Business Line Data and Key Metrics Changes - Aviation volume was 1.8 billion gallons, down 4% year-over-year, but gross profit increased by 11% to $143 million due to strong performance in Europe and government sales [12][14] - Land volumes declined 8% year-over-year, with gross profit at $81 million, down 20% due to unfavorable market conditions and recent business exits [15][16] - Marine volumes increased 3% year-over-year, but gross profit decreased 32% due to lower profit contributions and market volatility [16][17] Market Data and Key Metrics Changes - The aviation segment showed resilience with strong cash flow generation, while the marine segment faced challenges from low prices and volatility [21][23] - The land segment is undergoing a strategic focus to improve profitability and streamline operations following recent exits from non-core markets [16][25] Company Strategy and Development Direction - The company is sharpening its focus on core businesses and has announced leadership changes to enhance strategic execution [4][10] - The acquisition of Universal Trip Support Services is expected to enhance service offerings and drive growth in the aviation segment [13][14] - The company aims to improve operational efficiencies and drive shareholder returns through disciplined expense management and strategic investments [24][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the leadership team and the company's ability to navigate market challenges and capitalize on growth opportunities [5][10] - The company anticipates continued gross profit growth in aviation supported by the recent acquisition, while land and marine segments are expected to face headwinds [14][17] - Future M&A opportunities are being explored as interest rates decline, with a focus on core business activities [34][35] Other Important Information - The company generated $116 million in operating cash flow and $102 million in free cash flow in Q3, maintaining a strong liquidity profile [20][23] - The company has returned $214 million to shareholders through buybacks and dividends since the beginning of 2024, exceeding its target [24] Q&A Session Summary Question: What is needed to turn around unfavorable market conditions in the land segment? - Management is exploring strategies to improve transportation efficiencies and is evaluating long-term viability of certain markets [28][30] Question: How will the earnings accretion from the latest acquisition flow in the first year? - The earnings accretion is expected to be ratable over the first 12 months, with potential synergies realized in the following two years [32][33] Question: How is the company balancing divestitures and potential M&A opportunities? - The company is focused on restructuring the land segment while actively looking for additional M&A opportunities as interest rates decline [34][35] Question: What other areas are being targeted for cost efficiencies? - The company is implementing a global finance transformation initiative aimed at generating cost savings and improving operational efficiency [36][38]

Financial Data and Key Metrics Changes - In Q3 2025, consolidated volume was 4.3 billion gallons, down 4% year over year, and consolidated gross profit declined 7% to $250 million [14] - Operating expenses were $181 million, down 7% year over year, primarily due to lower variable costs [19] - Operating cash flow was $116 million, and free cash flow was $102 million, increasing year-to-date operating cash flow to $259 million and free cash flow to $215 million [21][25] Business Line Data and Key Metrics Changes - Aviation volume was 1.8 billion gallons, down 4% year over year, but gross profit increased by 11% to $143 million due to strong results in Europe and government sales [14][15] - Land volumes declined 8% year over year, with gross profit down 20% to $81 million, impacted by unfavorable market conditions and recent business exits [16][17] - Marine volumes increased 3% year over year, but gross profit decreased 32% due to lower profit contributions and market volatility [18] Market Data and Key Metrics Changes - The aviation segment showed resilience with growth in government and business aviation activities, while the land segment faced challenges from market exits and inefficiencies [10][17] - Marine performance was affected by low market volatility and bunker prices, but there are expectations for cash generation when market conditions improve [18][19] Company Strategy and Development Direction - The company is focusing on core businesses and has made leadership changes to enhance growth and returns, with a commitment to talent development [5][6] - A strategic acquisition of Universal Trip Support Services is expected to enhance service offerings and contribute to earnings growth [15][22] - The company is actively reshaping its portfolio by exiting non-core and underperforming businesses to concentrate on profitable activities [12][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the leadership team and their ability to navigate challenges, including macroeconomic headwinds and market volatility [6][10] - The company anticipates continued growth in aviation gross profit and is focused on improving land segment performance through operational efficiencies [15][18] - There is optimism about future M&A opportunities as interest rates decline, with a sharper focus on strategic acquisitions [39][40] Other Important Information - The company generated strong operating cash flow, maintaining a net debt to adjusted EBITDA ratio of under one times, which supports a healthy liquidity profile [25] - The company has returned $214 million to shareholders through buybacks and dividends since the beginning of 2024, exceeding its target [26] Q&A Session Summary Question: What is needed to turn around unfavorable market conditions in the land segment? - Management is exploring strategies to improve transportation efficiencies and evaluating long-term viability of certain markets [31][34] Question: How will the earnings accretion from the latest acquisition flow in the first year? - The earnings accretion is expected to be ratable on a monthly basis, with potential increases from synergies in the second year [35][37] Question: How is the company balancing divestitures and potential M&A opportunities? - The company is focused on restructuring the land business while actively looking for M&A opportunities as interest rates decline [38][39] Question: What other areas are expected to see variable cost efficiencies? - Management is looking at various parts of the business for cost-effective operations, including a global finance transformation initiative [41][42]

Financial Data and Key Metrics Changes - In Q3 2025, consolidated volume was 4.3 billion gallons, down 4% year over year, and gross profit declined 7% to $250 million [11][19] - Operating expenses were $181 million, down 7% year over year, reflecting effective cost management [17][21] - Interest expense increased to $26 million, up approximately 8% year over year [18] Business Line Data and Key Metrics Changes - Aviation volume was 1.8 billion gallons, down 4% year over year, but gross profit increased by 11% to $143 million due to strong performance in Europe and government sales [11][12] - Land volumes declined 8% year over year, with gross profit at $81 million, down 20% due to unfavorable market conditions [13][14] - Marine volumes increased 3% year over year, but gross profit decreased 32% due to lower profit contributions and market volatility [15][16] Market Data and Key Metrics Changes - The aviation segment showed resilience with growth in government and business aviation activities, while the marine segment faced challenges from low bunker prices and volatility [6][16] - The land segment is focusing on core profitable activities after exiting non-core businesses in Brazil and the UK [15][20] Company Strategy and Development Direction - The company is sharpening its focus on core businesses and has announced leadership changes to enhance strategic direction [4][9] - The acquisition of Universal Trip Support Services is expected to enhance service offerings and drive growth in the aviation segment [12][19] - The company aims to improve financial returns and earnings predictability through portfolio reshaping and operational efficiencies [7][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the leadership team and their ability to navigate market cycles and uncertainties [5][9] - The company anticipates continued growth in aviation gross profit supported by the recent acquisition and strong performance in Europe [12][19] - Management acknowledged challenges in the land segment but is focused on strategies to improve profitability [30][31] Other Important Information - The company generated $116 million in operating cash flow and $102 million in free cash flow in Q3 2025, maintaining a strong liquidity profile [19][22] - The adjusted effective tax rate for Q3 was 27%, with expectations for Q4 to remain consistent [18][19] Q&A Session Summary Question: What is needed to turn around unfavorable market conditions in the land segment? - Management is exploring strategies to manage delivery costs and evaluating long-term viability of certain markets [27][28][30] Question: How will the earnings accretion from the latest acquisition flow in the first year? - The contribution is expected to be ratable over the first 12 months, with additional synergies realized in the following two years [31][32] Question: How is the company balancing divestitures and potential M&A opportunities? - The company is actively looking at opportunities while focusing on restructuring and integrating the recent acquisition [33][34] Question: What other areas are being targeted for cost efficiencies? - The company is implementing a global finance transformation initiative aimed at generating long-term cost benefits [36][37]

Third Quarter 2025 Earnings Call October 23, 2025 © Copyright 2025 World Kinect Corporation. Proprietary & Confidential. All Rights Reserved. 1 Disclaimer and Cautionary Note Regarding Forward-Looking Statements Certain statements, including comments about World Kinect Corporation's expectations regarding future plans, performance and acquisitions are forward-looking statements that are subject to a range of uncertainties and risks that could cause World Kinect's actual results to materially differ from the ...

Financial Performance - Gross profit for Q3 2025 was $250 million, a decrease of 7% compared to Q3 2024[4] - GAAP net income for Q3 2025 was $26 million, or $0.46 per diluted share, down 19% from $0.57 per diluted share in Q3 2024[5] - Adjusted EBITDA for Q3 2025 was $94 million, a decrease of 6% from $100 million in Q3 2024[5] - Total revenue for Q3 2025 was $9.392 billion, a decline of 10% from $10.491 billion in Q3 2024[5] - Gross profit for Q3 2025 was $249.6 million, down from $268.1 million in Q3 2024, reflecting a gross margin of 2.7%[21] - Net income attributable to World Kinect for Q3 2025 was $25.7 million, compared to $33.5 million in Q3 2024, resulting in a basic earnings per share of $0.46[21] - The company reported a loss from operations of $288.8 million for the nine months ended September 30, 2025, compared to a profit of $180.7 million for the same period in 2024[21] - The company reported a net loss of $(332.2) million for the nine months ended September 30, 2025, compared to a net income of $169.1 million for the same period in 2024[23] - For the three months ended September 30, 2025, the GAAP net income was $28.1 million, compared to $35.0 million in 2024, reflecting a decrease of approximately 19.7%[29] Segment Performance - Aviation segment gross profit increased by 11% to $143 million, driven by higher contributions from operated airport locations in Europe[4] - Land segment gross profit decreased by 20% to $81 million, primarily due to lower contributions from the liquid fuel business in North America[4] - Marine segment gross profit decreased by 32% to $25 million, attributed to lower bunker fuel prices and reduced market volatility[4] - The Aviation segment reported revenue of $4,868.1 million for the three months ended September 30, 2025, a decrease of 6.7% from $5,218.4 million in 2024[25] - The Land segment's revenue decreased by 19.5% to $2,535.6 million for the three months ended September 30, 2025, compared to $3,151.6 million in 2024[25] Cash Flow and Assets - Operating cash flow generated in Q3 2025 was $116 million, with free cash flow of $102 million[4] - Total current assets decreased to $3,637.5 million as of September 30, 2025, from $3,959.2 million as of December 31, 2024[19] - Total liabilities decreased to $4,433.9 million as of September 30, 2025, from $4,775.8 million as of December 31, 2024[19] - Cash and cash equivalents increased to $473.6 million as of September 30, 2025, compared to $382.9 million as of December 31, 2024[19] - Net cash provided by operating activities for the three months ended September 30, 2025, was $116.1 million, a significant increase from a cash outflow of $38.5 million in the same period of 2024[23] - Cash and cash equivalents at the end of the period increased to $473.6 million as of September 30, 2025, compared to $373.8 million at the end of the same period in 2024[23] Expenditures and Impairments - Operating expenses for Q3 2025 were $187 million, a decrease of 5% compared to $196 million in Q3 2024[5] - The company reported capital expenditures of $(14.1) million for the three months ended September 30, 2025, compared to $(18.2) million in 2024, indicating a reduction in investment[23] - The company experienced goodwill and other asset impairments of $443.1 million for the nine months ended September 30, 2025[30] - Restructuring charges for the three months ended September 30, 2025, amounted to $4.9 million, while for the nine months, it was $25.9 million[29] Adjusted Metrics - Adjusted diluted earnings per share for the nine months ended September 30, 2025, was $1.60, compared to $1.56 in 2024, showing a slight increase of 2.6%[29] - The company's EBITDA for the nine months ended September 30, 2025, was $(290.6) million, a significant decline from $352.4 million in 2024[30] - The adjusted non-GAAP gross profit for the nine months ended September 30, 2025, was $712.4 million, compared to $767.5 million in 2024, indicating a decrease of 7.2%[30]

Core Insights - World Kinect Corporation has announced a series of executive leadership appointments, effective January 1, 2026 [1] - Ira M. Birns has been appointed as the new Chief Executive Officer and a member of the Board of Directors, succeeding Michael Kasbar [1] - Michael Kasbar will transition to the role of Executive Chairman of the Board on the same date [1]

Company Overview - World Kinect (WKC) is headquartered in Miami and operates in the Oils-Energy sector, experiencing a price change of -5.23% year-to-date [3] - The company currently pays a dividend of $0.20 per share, resulting in a dividend yield of 3.07%, which is higher than the Oil and Gas - Refining and Marketing industry's yield of 2.81% and the S&P 500's yield of 1.5% [3] Dividend Performance - World Kinect's annualized dividend of $0.80 has increased by 17.6% from the previous year [4] - Over the past five years, the company has raised its dividend four times, achieving an average annual increase of 13.04% [4] - The current payout ratio stands at 35%, indicating that the company distributes 35% of its trailing 12-month earnings per share as dividends [4] Earnings Growth - The Zacks Consensus Estimate for World Kinect's earnings in 2025 is projected at $2.25 per share, reflecting a year-over-year growth rate of 3.21% [5] Investment Appeal - World Kinect is positioned as an attractive investment opportunity due to its strong dividend yield and a Zacks Rank of 1 (Strong Buy) [6]

Core Insights - The article compares World Kinect (WKC) and Phillips 66 (PSX) as potential undervalued stocks in the Oil and Gas - Refining and Marketing sector [1] Valuation Metrics - WKC has a forward P/E ratio of 11.61, while PSX has a forward P/E of 25.77 [5] - WKC's PEG ratio is 1.18, compared to PSX's PEG ratio of 1.95 [5] - WKC's P/B ratio is 0.9, indicating a lower market value relative to its book value, while PSX has a P/B of 1.94 [6] Investment Ratings - Both WKC and PSX currently hold a Zacks Rank of 1 (Strong Buy), indicating positive earnings estimate revisions for both companies [3] - WKC has a Value grade of A, while PSX has a Value grade of C, suggesting WKC is the superior value option based on current valuation figures [6]