World Kinect Corporation (NYSE:WKC) is among the 10 Best Affordable Energy Stocks to Buy. World Kinect Corporation (WKC) Faces Short-Term Risks but Shines in Dividend Growth On March 3, Morgan Stanley cut the price target on World Kinect Corporation (NYSE:WKC) to $25, down from $27, and maintained an Underweight rating. Although the firm remains cautious about pullback risk for midstream equities in the near term, it believes that U.S. military action against Iran has increased uncertainty for global oil ...

Business Strategy - The company is executing a plan to exit unprofitable operations within the land segment, including direct fuel transportation services and certain advisory offerings [21]. - Future focus will be on higher margin cardlock and retail activities, as well as the natural gas business, expected to improve operating leverage and cash flow [22]. - The company is actively pursuing acquisitions and strategic transactions to enhance its market position [49]. - The company is committed to integrating acquired businesses effectively to realize anticipated benefits [51]. Market Conditions - The marine segment serves a broad base of customers, providing real-time market intelligence and access to competitively priced marine fuel [23]. - The majority of marine segment activity consists of spot sales, with costs tied to spot pricing and market-based formulas [24]. - Seasonal variability affects operating results, with stronger performance in the second and third quarters for the aviation segment due to travel demand [26]. - The company anticipates macroeconomic conditions, including inflation, will impact its operations and financial performance [49]. - The company is monitoring the impact of geopolitical tensions, particularly in Eastern Europe and the Middle East, on its business [52]. Regulatory Compliance - Compliance with environmental regulations may require capital expenditures and increase operating costs, impacting demand for products and services [28]. - The company is subject to evolving climate change regulations, including GHG emissions reporting and state-level cap-and-trade programs [31]. - The European Union aims to reduce net GHG emissions by at least 55% by 2030, influencing regulatory frameworks globally [35]. - The company acknowledges risks related to compliance with environmental regulations, which could increase operating costs [52]. Financial Performance - The company expects growth in its core businesses, although specific growth rates were not disclosed [49]. - Fuel prices and working capital requirements are projected to significantly affect the company's liquidity and capital expenditures [49]. - The company emphasizes the importance of maintaining sufficient liquidity to fund working capital and strategic investments [52]. - The company is focused on mitigating financial risks associated with derivatives and physical fuel products [51]. - The company faces potential adverse conditions in the industries where its customers operate, which could impact revenue [51]. Employee Commitment - The company is committed to investing in employee growth and well-being, offering competitive compensation and professional development opportunities [48].

Core Insights - World Kinect (WKC) reported a revenue of $9.03 billion for the quarter ended December 2025, reflecting a year-over-year decline of 7.5% and an EPS of $0.30 compared to $0.62 a year ago [1] - The reported revenue fell short of the Zacks Consensus Estimate of $9.22 billion, resulting in a surprise of -2.12%, while the EPS surprise was -36.17% against a consensus estimate of $0.47 [1] Financial Performance Metrics - The company’s performance metrics indicate a decline in operational income across various segments: - Land: Income loss of $292.2 million compared to an average estimate of $12.35 million [4] - Aviation: Income of $54.2 million versus an average estimate of $69.35 million [4] - Marine: Income of $7 million compared to an average estimate of $9.47 million [4] - Volume metrics also showed discrepancies with: - Land volume at 1,392.70 million gallons against an average estimate of 1,412.81 million gallons [4] - Aviation volume at 1,763.10 million gallons compared to an average estimate of 1,771.94 million gallons [4] Stock Performance - Over the past month, shares of World Kinect have returned -0.8%, aligning with the Zacks S&P 500 composite's -0.8% change, and the stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

分组1 - World Kinect reported quarterly earnings of $0.3 per share, missing the Zacks Consensus Estimate of $0.47 per share, and down from $0.62 per share a year ago, representing an earnings surprise of -36.17% [1] - The company posted revenues of $9.03 billion for the quarter ended December 2025, missing the Zacks Consensus Estimate by 2.12%, and down from $9.76 billion year-over-year [2] - World Kinect has not surpassed consensus revenue estimates over the last four quarters [2] 分组2 - The stock has gained approximately 12.8% since the beginning of the year, outperforming the S&P 500's gain of 0.5% [3] - The current consensus EPS estimate for the coming quarter is $0.35 on revenues of $8.98 billion, and for the current fiscal year, it is $2.41 on revenues of $37.47 billion [7] - The Oil and Gas - Refining and Marketing industry is currently in the bottom 15% of the Zacks industries, indicating potential challenges for stocks in this sector [8]

Financial Data and Key Metrics Changes - The fourth quarter consolidated volume was 4.2 billion gallons, down 5% year-over-year, with full-year volume totaling 16.9 billion gallons, down approximately 4% [16] - Fourth quarter gross profit was $235 million, down 9% year-over-year, and full-year gross profit was $948 million, down 8% from 2024 [16][17] - Total non-GAAP adjustments in the fourth quarter were $325 million, with significant impairments primarily within the land segment [15] Business Line Data and Key Metrics Changes - Aviation volumes in the fourth quarter were 1.8 billion gallons, down 5% year-over-year, but gross profit increased approximately 8% to $130 million due to the Universal Trip Support acquisition [17][18] - Land volumes declined 9% year-over-year in the fourth quarter, with gross profit down 32% to $71 million, driven by unfavorable market conditions and exit activities [20][21] - Marine volumes were approximately 4.1 million metric tons in the fourth quarter, flat year-over-year, while gross profit increased 2% to $35 million [23] Market Data and Key Metrics Changes - The company is focusing on North America for its land business, emphasizing higher margin activities such as cardlock and retail, as well as natural gas [8][10] - The exit from European power and energy management businesses shifts focus to core areas that deliver consistent profitability [10] Company Strategy and Development Direction - The company is reshaping its portfolio to concentrate on businesses that deliver attractive and predictable returns, enhancing financial discipline and operational efficiency [6][12] - The acquisition of Universal Weather and Aviation's trip support services is expected to strengthen the company's role in global aviation services [7] - The strategic shift in the land segment aims to enhance returns and improve profitability, with a focus on cardlock, retail, and natural gas [22] Management's Comments on Operating Environment and Future Outlook - Management acknowledges that the fourth quarter performance fell short of expectations due to competitive pressures and underperformance in certain business lines [12] - The outlook for 2026 reflects confidence in the structural changes made, aiming for more consistent performance and growth in core businesses [13][30] - Management expects adjusted EPS for 2026 to be in the range of $2.20-$2.40, indicating solid year-over-year growth [27] Other Important Information - The company generated $34 million of operating cash flow and $13 million of free cash flow in the fourth quarter, with full-year free cash flow totaling $227 million [28] - An incremental $150 million share repurchase authorization was approved, reflecting confidence in the business [29] Q&A Session Summary Question: Impact of Universal Trip acquisition and tank wagon business sale - The Universal Trip Support business is expected to contribute approximately $70 million in gross profit for 2026, while the tank wagon business exit will shed about 1 billion gallons of volume [34][36] Question: Seasonality in land business after exiting European operations - The seasonality in the land business is expected to improve, with the main seasonality now related to aviation demand [41][42] Question: New model for managing fuel operations with independent operators - The new hybrid model allows for better cash flow and higher margins, with opportunities for growth in the convenience store space [46][47] Question: Competitive pressure in aviation and its implications - While competitive pressure is present, management is optimistic about finding new opportunities to expand airport locations and drive additional volume [50][51] Question: Factors for rebound in marine business - The marine business is influenced by macro factors such as price and volatility, with expectations for stability in 2026 [53][54]

Financial Data and Key Metrics Changes - Q4 consolidated volume was 4.2 billion gallons, down 5% year-over-year, with full-year volume totaling 16.9 billion gallons, down approximately 4% [16] - Q4 gross profit was $235 million, down 9% year-over-year, and full-year gross profit was $948 million, down 8% from 2024 [16][17] - Adjusted operating expenses in Q4 were $186 million, down 6% year-over-year, and for the full year, adjusted operating expenses declined approximately 7% to $718 million [24][25] Business Line Data and Key Metrics Changes - Aviation Q4 volumes were 1.8 billion gallons, down 5% year-over-year, but gross profit increased approximately 8% year-over-year to $130 million due to the Universal Trip Support acquisition [17][18] - Land Q4 volumes declined 9% year-over-year, with gross profit at $71 million, down 32% year-over-year, driven by unfavorable market conditions and exit activities [20][21] - Marine Q4 volumes were approximately 4.1 million metric tons, flat year-over-year, while Q4 gross profit increased 2% year-over-year to $35 million [23] Market Data and Key Metrics Changes - The company is focusing on North America for its land business, particularly in higher margin areas such as cardlock and retail activities, as well as natural gas [8][10] - The exit from European power and energy management businesses allows the company to concentrate on core areas that deliver consistent profitability [10][12] Company Strategy and Development Direction - The company is reshaping its portfolio to focus on businesses that deliver attractive and predictable returns, with a commitment to operational excellence and disciplined capital allocation [6][7] - The acquisition of Universal Weather and Aviation's trip support services is expected to enhance capabilities in flight support and strengthen the global aviation services role [7] - The strategic shift in the land segment aims to improve profitability and transparency regarding long-term growth potential [9][11] Management's Comments on Operating Environment and Future Outlook - Management acknowledges that Q4 performance fell short of expectations due to competitive pressures and underperformance in certain business lines [12] - The outlook for 2026 reflects confidence in structural changes that simplify the business and enhance focus on core growth areas [13] - Management expects adjusted operating income to nearly double in the refocused land business, despite lower volumes and gross profit [23] Other Important Information - Total non-GAAP adjustments in Q4 were $325 million, primarily due to non-cash intangible and asset impairments [15] - The company generated $34 million of operating cash flow and $13 million of free cash flow in Q4, with full-year free cash flow at $227 million [28] Q&A Session Summary Question: Can you discuss the scale of revenues and operating income from the Universal Trip acquisition? - The gross profit for the Universal Trip Support business is approximately $70 million, with the impact on 2026 expected to be around that figure [35] Question: What impact should we expect from the sale of the tank wagon business? - The company is shedding about 1 billion gallons worth of volume and expects to receive about $100 million from the transaction [36] Question: How will the exit from European businesses affect seasonality in land? - The seasonality in land is expected to improve significantly with the exit of the UK land business, making the business more balanced [41][43] Question: Can you elaborate on the new model of owning and managing fuel operations? - The new hybrid model allows for better cash flow and higher margins by owning the fuel and partnering with independent operators for convenience stores [47][48] Question: What are the expectations for the marine business rebound? - The marine business is stable but relies on macro factors such as price and volatility, which are currently low [53][54]

Financial Data and Key Metrics Changes - The fourth quarter consolidated volume was 4.2 billion gallons, down 5% year-over-year, with full-year volume totaling 16.9 billion gallons, down approximately 4% [18] - Fourth quarter gross profit was $235 million, down 9% year-over-year, and full-year gross profit was $948 million, down 8% from 2024 [18][19] - Total non-GAAP adjustments in the fourth quarter were $325 million, primarily due to $247 million of non-cash intangible and other asset impairments [17] Business Line Data and Key Metrics Changes - Aviation volumes in the fourth quarter were 1.8 billion gallons, down 5% year-over-year, but gross profit increased approximately 8% to $130 million due to the Universal Trip Support acquisition [19] - Land volumes declined 9% year-over-year in the fourth quarter, with gross profit down 32% to $71 million, driven by unfavorable market conditions and strategic exits [22] - Marine volumes were approximately 4.1 million metric tons in the fourth quarter, flat year-over-year, while gross profit increased 2% to $35 million [25] Market Data and Key Metrics Changes - The company is focusing on North America for its land business, particularly in higher margin areas such as cardlock and retail activities, as well as natural gas [10] - The exit from European power and energy management businesses shifts focus to core businesses that deliver more consistent profitability [11] Company Strategy and Development Direction - The company is reshaping its portfolio to concentrate on businesses that deliver attractive and predictable returns, enhancing efficiency and financial discipline [6][8] - A renewed focus on core business and operational excellence is expected to drive sustainable growth, with significant changes in the land segment aimed at improving profitability [10][12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that the fourth quarter performance fell short of expectations due to competitive pressures and underperformance in certain business lines [13] - The outlook for 2026 reflects confidence in structural changes that simplify the business and enhance focus on core growth areas [15] Other Important Information - The company generated $34 million of operating cash flow and $13 million of free cash flow in the fourth quarter, with full-year free cash flow totaling $227 million [30] - An incremental $150 million share repurchase authorization was approved, reflecting confidence in the business [31] Q&A Session Summary Question: Impact of Universal Trip acquisition and tank wagon business sale - The Universal Trip Support business is expected to contribute approximately $70 million in gross profit in 2026, while the tank wagon business exit will shed about 1 billion gallons of volume [36][38] Question: Seasonality in land business post-exits - The seasonality in the land business is expected to improve with the exit of non-core activities, while aviation will still experience seasonal demand fluctuations [44][46] Question: New business model for fuel management - The new model involves owning or leasing sites and partnering with independent operators, which is expected to improve cash flow and margins [48][49] Question: Competitive pressure in aviation - While competitive pressure is anticipated, the company is exploring new opportunities to expand airport locations to offset margin pressures [51] Question: Marine business rebound factors - The marine business is influenced by macro factors such as price and volatility, with expectations for stability in 2026 unless market conditions improve [55]

Fourth Quarter 2025 Earnings Call February 19, 2026 © Copyright 2026 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 t ...

Financial Performance - Fourth quarter 2025 gross profit was $235 million, a decrease of 9% compared to $259 million in Q4 2024[6] - GAAP net loss for Q4 2025 was $280 million, or $5.11 per diluted share, compared to a loss of $101 million, or $1.77 per diluted share in Q4 2024[6] - Adjusted net income for Q4 2025 was $17 million, or $0.30 per diluted share, down 52% from $0.62 per diluted share in Q4 2024[6] - Full year 2025 gross profit totaled $948 million, an 8% decline from $1,026 million in 2024[6] - Total revenue for the year ended December 31, 2025, was $36,916.6 million, a decrease of 12.0% compared to $42,168.0 million in 2024[30] - Gross profit for the year ended December 31, 2025, was $947.8 million, down from $1,026.4 million in 2024, reflecting a gross margin of 2.7%[30] - Net loss attributable to World Kinect for the year ended December 31, 2025, was $614.4 million, compared to a net income of $67.4 million in 2024[30] - Basic earnings per share for the year ended December 31, 2025, was $(10.99), a significant decline from $1.14 in 2024[30] - Total revenue for the three months ended December 31, 2025, was $9,029.0 million, a decrease of 7.5% compared to $9,760.5 million for the same period in 2024[34] - The company reported a net loss of $279.5 million for the three months ended December 31, 2025, compared to a loss of $101.2 million in the same period of 2024[32] - Gross profit for the total company was $235.4 million for the three months ended December 31, 2025, down from $258.9 million in 2024, reflecting a gross margin decline[34] - The company reported a comprehensive loss attributable to World Kinect of $540.7 million for the year ended December 31, 2025, compared to a comprehensive income of $125.3 million in 2024[30] Operating Expenses - Operating expenses for Q4 2025 increased by 123% to $511 million, compared to $229 million in Q4 2024[7] - Restructuring and exit-related costs for Q4 2025 were recorded at $77 million, primarily due to exits from non-core business activities[6] - Operating expenses for the year ended December 31, 2025, totaled $1,512.5 million, up from $815.7 million in 2024, primarily due to goodwill and asset impairments[30] - The company incurred goodwill and other asset impairment charges of $246.5 million for the three months ended December 31, 2025, compared to $25.3 million in 2024[32] - The company incurred $689.6 million in goodwill and other asset impairments for the year ended December 31, 2025, compared to $29.0 million in 2024[39] - Restructuring and exit costs for the year ended December 31, 2025, totaled $103.1 million, up from $7.1 million in 2024[39] Cash Flow and Assets - The company generated $293 million of operating cash flow and $227 million of free cash flow in 2025[6] - Cash and cash equivalents decreased to $193.5 million as of December 31, 2025, from $382.9 million in 2024[28] - Total current assets decreased to $3,500.5 million as of December 31, 2025, from $3,959.2 million in 2024[28] - Total liabilities decreased to $4,556.1 million as of December 31, 2025, compared to $4,775.8 million in 2024[28] - Total cash and cash equivalents at the end of the period were $193.5 million, down from $382.9 million at the end of the previous year[32] - The net cash provided by operating activities for the year ended December 31, 2025, was $292.9 million, compared to $259.9 million in 2024[39] - Free cash flow for the year ended December 31, 2025, was $227.3 million, an increase from $191.7 million in 2024[39] Segment Performance - The Aviation segment generated revenue of $4,746.2 million for the three months ended December 31, 2025, slightly up from $4,737.8 million in 2024, while the Land segment revenue decreased by 18.2% to $2,414.1 million[34] - The Land segment has substantially completed its strategic repositioning, with additional non-core business exits planned for 2026[6] - The Land segment reported an operating loss of $292.2 million for the three months ended December 31, 2025, compared to an operating income of $11.7 million in 2024[34] - The consolidated total sales volume for the three months ended December 31, 2025, was 4,240.8 million gallons, a decrease of 5.2% from 4,472.4 million gallons in 2024[36] Future Outlook - For 2026, the company expects adjusted diluted EPS to be in the range of $2.20 to $2.40[13] - The company completed the acquisition of Universal Weather and Aviation's Trip Support Services division, enhancing its aviation service capabilities[6] - Adjusted EBITDA for the year ended December 31, 2025, was $717.5 million, while for 2024 it was $230.3 million, indicating a significant increase[39] - Acquisition and divestiture related expenses were $0.8 million for both the three months ended December 31, 2025, and 2024[39] - The company experienced a loss on the sale of business of $0.4 million for the three months ended December 31, 2025, compared to a gain of $111.3 million in 2024[39] - Integration costs for the year ended December 31, 2025, were $1.0 million, consistent with the previous year[39]

Core Insights - Analysts project that World Kinect (WKC) will report quarterly earnings of $0.47 per share, reflecting a year-over-year decline of 24.2% [1] - Revenue is expected to reach $9.22 billion, down 5.5% from the same quarter last year [1] - The consensus EPS estimate has remained unchanged over the past 30 days, indicating a reassessment of projections by covering analysts [1] Revenue and Earnings Estimates - The 'Volume - Land' is estimated to be 1413 million gallons, down from 1535 million gallons reported in the same quarter last year [4] - 'Volume - Aviation' is projected at 1772 million gallons, compared to 1848 million gallons a year ago [4] - 'Income (loss) from operations - Aviation' is expected to be $69.35 million, an increase from $59.70 million reported last year [5] - 'Income (loss) from operations - Marine' is projected at $9.47 million, down from $12.70 million a year ago [5] - 'Income (loss) from operations - Land' is estimated at $12.35 million, slightly up from $11.70 million reported in the same quarter last year [6] Market Performance - Over the past month, shares of World Kinect have returned +2.7%, while the Zacks S&P 500 composite has changed by -1.3% [6] - Currently, WKC holds a Zacks Rank 3 (Hold), suggesting its performance may align with the overall market in the near future [6]