WORLD FUEL SERVICES CORPORATION UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FORM 10-Q For the transition period from __________ to ___________ COMMISSION FILE NUMBER 001-09533 (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 OR Indicate by check mark whether the registrant: (1) has filed all ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 Florida 9800 N.W. 41st Street, Miami, Florida 33178 59-2459427 (Address of Principal Executive Offices) (Zip Code) (I.R.S. Employer Identification No.) Registrant's telephone number, including area code: ( 305 ) 428-8000 Securities registered pursuant to Section 12(b) of the Act OR ☐ T ...

[Part I. Financial Information](index=3&type=section&id=Part%20I.%20Financial%20Information) [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents the unaudited condensed consolidated financial statements of World Fuel Services Corporation for the quarter ended March 31, 2022, including the balance sheets, statements of income and comprehensive income, statements of shareholders' equity, and statements of cash flows, along with their accompanying notes [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) | Metric | March 31, 2022 (Millions) | December 31, 2021 (Millions) | Change (Millions) | | :-------------------------------- | :-------------------------- | :--------------------------- | :---------------- | | Total Current Assets | $5,025.3 | $4,019.7 | +$1,005.6 | | Total Assets | $7,968.0 | $5,942.4 | +$2,025.6 | | Total Current Liabilities | $4,412.5 | $3,096.7 | +$1,315.8 | | Total Liabilities | $6,022.6 | $4,025.6 | +$1,997.0 | | Total Equity | $1,945.5 | $1,916.8 | +$28.7 | [Condensed Consolidated Statements of Income and Comprehensive Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :---------------------------------------- | :-------------- | :-------------- | :---------------- | :------------- | | Revenue | $12,382.0 | $5,957.9 | +$6,424.1 | +107.8% | | Gross profit | $230.9 | $191.6 | +$39.3 | +20.5% | | Income from operations | $41.3 | $37.6 | +$3.7 | +9.8% | | Net income attributable to World Fuel | $26.3 | $18.9 | +$7.4 | +39.2% | | Basic earnings per common share | $0.42 | $0.30 | +$0.12 | +40.0% | | Diluted earnings per common share | $0.41 | $0.30 | +$0.11 | +36.7% | [Condensed Consolidated Statements of Shareholders' Equity](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Shareholders%27%20Equity) | Item | Amount (Millions) | | :------------------------------------ | :---------------- | | Balance as of December 31, 2021 | $1,916.8 | | Net income (loss) | $26.3 | | Cash dividends declared | $(7.6) | | Issuance of common stock for acquisition | $50.0 | | Purchases of common stock | $(13.7) | | Other comprehensive income (loss) | $(28.7) | | Balance as of March 31, 2022 | $1,945.5 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) | Cash Flow Activity | 2022 (Millions) | 2021 (Millions) | Change (Millions) | | :---------------------------------- | :-------------- | :-------------- | :---------------- | | Net cash provided by (used in) operating activities | $(72.0) | $103.4 | $(175.4) | | Net cash provided by (used in) investing activities | $(657.3) | $(2.7) | $(654.6) | | Net cash provided by (used in) financing activities | $343.7 | $(20.8) | +$364.5 | | Net increase (decrease) in cash and cash equivalents | $(386.0) | $76.5 | $(462.5) | | Cash and cash equivalents, end of period | $266.2 | $735.3 | $(469.1) | [Notes to the Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) [Note 1. Basis of Presentation, New Accounting Standards, and Significant Accounting Policies](index=7&type=section&id=Note%201.%20Basis%20of%20Presentation%2C%20New%20Accounting%20Standards%2C%20and%20Significant%20Accounting%20Policies) World Fuel Services Corporation is a global fuel services company distributing fuel and related products in aviation, land, and marine transportation. The company aims to become a leading global energy management company, expanding into energy advisory, sustainability, and renewable energy solutions. The financial statements are prepared under U.S. GAAP, and there have been no material changes in accounting standards or policies during the quarter - World Fuel Services Corporation is a leading global fuel services company, distributing fuel and related products and services in the aviation, land, and marine transportation industries[13](index=13&type=chunk) - The company intends to become a leading global energy management company, offering energy advisory, management, fulfillment services, technology solutions, payment management, and sustainability products across the energy spectrum[13](index=13&type=chunk) - No new accounting standards adopted in 2022 had a material impact, and no recently issued standards are expected to have a material impact[17](index=17&type=chunk)[18](index=18&type=chunk) [Note 2. Accounts Receivable](index=8&type=section&id=Note%202.%20Accounts%20Receivable) The company manages credit exposure for accounts receivable, which totaled $3.5 billion as of March 31, 2022. The allowance for credit losses decreased, and 96% of receivables were outstanding less than 60 days. The company also utilizes receivable purchase agreements (RPAs) to sell qualifying accounts receivable | Metric | March 31, 2022 (Millions) | December 31, 2021 (Millions) | | :-------------------------------------- | :------------------------ | :--------------------------- | | Accounts receivable | $3,510.2 | $2,355.3 | | Allowance for expected credit losses | $21.0 | $29.8 | - As of March 31, 2022, **96%** of accounts receivable were outstanding less than 60 days[22](index=22&type=chunk) | Metric | Three Months Ended March 31, 2022 (Millions) | Three Months Ended March 31, 2021 (Millions) | | :-------------------------------------- | :------------------------------------------- | :------------------------------------------- | | Aggregate face value of receivables sold | $2,600.0 | $2,000.0 | | Fees paid under RPAs | $5.5 | $4.4 | [Note 3. Acquisitions](index=8&type=section&id=Note%203.%20Acquisitions) World Fuel Services completed the acquisition of Flyers Energy Group, LLC on January 3, 2022, for an estimated $792.2 million, paid in cash and common stock. This acquisition is reported in the land segment and is expected to bring synergies. The company also completed another liquid fuel business acquisition in October 2021 - The acquisition of Flyers Energy Group, LLC closed on January 3, 2022, for total estimated consideration of **$792.2 million**, including **$642.7 million** in cash and **$50.0 million** in common stock[27](index=27&type=chunk) - The acquisition resulted in **$387.1 million** in goodwill, primarily attributable to expected synergies within the land segment[28](index=28&type=chunk) - Flyers contributed **$752.5 million** in revenue and **$18.1 million** in income before income taxes from the acquisition date through March 31, 2022[28](index=28&type=chunk) [Note 4. Goodwill](index=10&type=section&id=Note%204.%20Goodwill) Goodwill increased significantly to $1,244.6 million as of March 31, 2022, primarily due to the $387.1 million goodwill recognized from the Flyers acquisition in the land segment | Segment | December 31, 2021 (Millions) | 2022 Acquisition (Millions) | Foreign Currency Translation (Millions) | March 31, 2022 (Millions) | | :--------- | :--------------------------- | :-------------------------- | :-------------------------------------- | :------------------------ | | Aviation | $400.1 | — | $(0.8) | $399.3 | | Land | $461.8 | $387.1 | $(3.5) | $845.4 | | **Total** | **$861.9** | **$387.1** | **$(4.3)** | **$1,244.6** | [Note 5. Derivative Instruments](index=10&type=section&id=Note%205.%20Derivative%20Instruments) The company uses derivative instruments (fair value hedges, cash flow hedges, and non-designated derivatives) to mitigate risks from commodity price changes, foreign currency exchange rates, and interest rates. The gross notional value of commodity contracts was 55.2 million BBL long and 51.6 million BBL short as of March 31, 2022 - The company's risk management program includes fair value hedges (for inventory price risk), cash flow hedges (for price and interest rate volatility in forecasted transactions), and non-designated derivatives (for market price fluctuations and currency rate hedging)[32](index=32&type=chunk)[33](index=33&type=chunk) | Contract Type | Unit | Value (Millions) | | :---------------------------- | :--- | :--------------- | | Commodity contracts (Long) | BBL | 55.2 | | Commodity contracts (Short) | BBL | (51.6) | | Foreign currency (Sell USD) | USD | (301.9) | | Foreign currency (Buy USD) | USD | 536.9 | | Interest rate swap | USD | 300.0 | | Item | 2022 (Millions) | 2021 (Millions) | | :---------------------------------------------------------------- | :-------------- | :-------------- | | Gains (losses) on fair value hedge relationships (commodity) | $(12.6) | $3.6 | | Gains (losses) on cash flow hedge relationships (commodity) | $(33.0) | $(11.7) | | Gains (losses) on cash flow hedge relationships (interest rate) | $(0.3) | $(0.2) | | Realized/unrealized gains (losses) on non-designated derivatives | $67.6 | $12.9 | [Note 6. Debt, Interest Income, Expense, and Other Finance Costs](index=14&type=section&id=Note%206.%20Debt%2C%20Interest%20Income%2C%20Expense%2C%20and%20Other%20Finance%20Costs) The company amended its Credit Facility on April 1, 2022, increasing total borrowing capacity to $2.0 billion and extending maturity to April 1, 2027. Total debt increased to $884.2 million as of March 31, 2022, with net interest expense increasing to $14.3 million for the quarter - On April 1, 2022, the company amended its Credit Facility to increase the revolving credit facility to **$1.5 billion**, provide a new term loan of **$500 million** (total borrowing capacity of **$2.0 billion**), and extend maturity to April 1, 2027[44](index=44&type=chunk) | Debt Type | March 31, 2022 (Millions) | December 31, 2021 (Millions) | Change (Millions) | | :------------------ | :------------------------ | :--------------------------- | :---------------- | | Credit Facility | $424.8 | — | +$424.8 | | Term loans | $436.7 | $484.1 | $(47.4) | | Total debt | $884.2 | $508.7 | +$375.5 | | Long-term debt | $869.1 | $478.1 | +$391.0 | | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | | :-------------------------------------- | :-------------- | :-------------- | :---------------- | | Interest income | $2.5 | $2.3 | +$0.2 | | Interest expense and other financing costs | $(16.8) | $(11.1) | $(5.7) | | Net interest expense and other financing costs | $(14.3) | $(8.7) | $(5.6) | [Note 7. Shareholders' Equity](index=14&type=section&id=Note%207.%20Shareholders%27%20Equity) The company declared quarterly cash dividends of $0.12 per common share for both periods. Accumulated other comprehensive income (loss) significantly decreased to $(165.4) million as of March 31, 2022, primarily due to foreign currency translation adjustments and cash flow hedge losses - Quarterly cash dividends of **$0.12 per common share** were declared for both Q1 2022 (**$7.6 million** total) and Q1 2021 (**$7.5 million** total)[47](index=47&type=chunk) | Component | January 1, 2022 (Millions) | March 31, 2022 (Millions) | Change (Millions) | | :-------------------------------------- | :------------------------- | :------------------------ | :---------------- | | Foreign Currency Translation Adjustments | $(134.0) | $(143.4) | $(9.4) | | Cash Flow Hedges | $(2.7) | $(22.0) | $(19.3) | | **Total Accumulated Other Comprehensive Income (Loss)** | **$(136.7)** | **$(165.4)** | **$(28.7)** | [Note 8. Fair Value Measurements](index=15&type=section&id=Note%208.%20Fair%20Value%20Measurements) The company measures certain assets and liabilities at fair value on a recurring basis, primarily commodity and foreign currency contracts. Total assets at fair value increased to $1,468.5 million and total liabilities at fair value increased to $1,406.8 million as of March 31, 2022, largely driven by commodity contracts | Item | March 31, 2022 (Millions) | December 31, 2021 (Millions) | Change (Millions) | | :---------------------------------- | :------------------------ | :--------------------------- | :---------------- | | Total assets at fair value | $1,468.5 | $788.3 | +$680.2 | | Total liabilities at fair value | $1,406.8 | $748.5 | +$658.3 | - As of March 31, 2022, one counterparty represented over **10%** of the company's credit exposure to OTC derivative counterparties, totaling **$81.5 million**[55](index=55&type=chunk) [Note 9. Revenue from Contracts with Customers](index=18&type=section&id=Note%209.%20Revenue%20from%20Contracts%20with%20Customers) Total revenue for the three months ended March 31, 2022, was $12.38 billion, significantly up from $5.96 billion in the prior year, with all segments (Aviation, Land, Marine) showing substantial increases across various geographic regions | Segment/Region | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :------------- | :-------------- | :-------------- | :---------------- | :------------- | | **Total Revenue** | **$12,382.0** | **$5,957.9** | **$6,424.1** | **107.8%** | | Aviation | $5,010.5 | $2,095.0 | $2,915.5 | 139.2% | | Land | $4,380.8 | $2,188.2 | $2,192.6 | 100.2% | | Marine | $2,990.6 | $1,674.7 | $1,315.9 | 78.6% | | North America | $6,900.8 | $3,147.4 | $3,753.4 | 119.2% | | EMEA | $2,511.3 | $1,363.9 | $1,147.4 | 84.1% | | Asia Pacific | $1,419.3 | $845.7 | $573.6 | 67.8% | | LATAM | $1,430.1 | $597.3 | $832.8 | 139.4% | [Note 10. Income Taxes](index=18&type=section&id=Note%2010.%20Income%20Taxes) The income tax provision decreased to $6.4 million for Q1 2022 from $8.8 million in Q1 2021, with the effective tax rate falling to 19.5% from 31.8%. This was influenced by discrete tax benefits and changes in tax jurisdictions. The company is also involved in ongoing tax examinations in Denmark, South Korea, and the U.S., with potential material impacts | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | | :------------------------ | :-------------- | :-------------- | :---------------- | | Income tax provision | $6.4 | $8.8 | $(2.4) | | Effective income tax rate | 19.5% | 31.8% | -12.3 pp | - The Q1 2022 income tax provision includes a net discrete income tax benefit of **$1.2 million**, comprising a **$4.1 million** benefit for uncertain tax position remeasurement, partially offset by **$2.0 million** for state apportionment/NOL changes and **$0.8 million** for other worldwide adjustments[59](index=59&type=chunk) - The company faces ongoing tax examinations in Denmark (proposed assessments of **~$57.3 million** for 2015-2017, vigorously defending), South Korea (agreed to settlement reducing assessment to **~$1.6 million** for 2011-2014), and the U.S. (2019 examination ongoing, 2017-2018 assessments accepted with no material impact)[61](index=61&type=chunk)[62](index=62&type=chunk)[63](index=63&type=chunk) [Note 11. Business Segments](index=19&type=section&id=Note%2011.%20Business%20Segments) The company operates in three segments: aviation, land, and marine. All segments saw significant revenue growth in Q1 2022, with land and marine segments driving the increase in income from operations, while aviation income declined due to inventory losses and reduced government activity | Segment | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :-------------- | :-------------- | :-------------- | :---------------- | :------------- | | Aviation segment | $5,010.5 | $2,095.0 | +$2,915.5 | +139.2% | | Land segment | $4,380.8 | $2,188.2 | +$2,192.6 | +100.2% | | Marine segment | $2,990.6 | $1,674.7 | +$1,315.9 | +78.6% | | **Total revenue** | **$12,382.0** | **$5,957.9** | **+$6,424.1** | **+107.8%** | | Segment | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :-------------- | :-------------- | :-------------- | :---------------- | :------------- | | Aviation segment | $7.5 | $23.0 | $(15.5) | -67.4% | | Land segment | $33.4 | $32.8 | +$0.6 | +1.8% | | Marine segment | $23.1 | $6.4 | +$16.7 | +260.9% | | **Total income from operations** | **$41.3** | **$37.6** | **+$3.7** | **+9.8%** | | Segment | March 31, 2022 (Millions) | December 31, 2021 (Millions) | Change (Millions) | | :-------------- | :------------------------ | :--------------------------- | :---------------- | | Aviation segment | $2,719.5 | $2,305.6 | +$413.9 | | Land segment | $3,516.1 | $2,106.1 | +$1,410.0 | | Marine segment | $1,403.7 | $1,022.7 | +$381.0 | | **Total assets** | **$7,968.0** | **$5,942.4** | **+$2,025.6** | [Note 12. Earnings Per Common Share](index=21&type=section&id=Note%2012.%20Earnings%20Per%20Common%20Share) Basic earnings per common share increased to $0.42 for Q1 2022 from $0.30 in Q1 2021, and diluted EPS also rose to $0.41 from $0.30, reflecting higher net income attributable to World Fuel | Metric | 2022 | 2021 | Change | YoY Change (%) | | :-------------------------------------- | :------ | :------ | :------ | :------------- | | Net income attributable to World Fuel (Millions) | $26.3 | $18.9 | +$7.4 | +39.2% | | Basic earnings per common share | $0.42 | $0.30 | +$0.12 | +40.0% | | Diluted earnings per common share | $0.41 | $0.30 | +$0.11 | +36.7% | [Note 13. Commitments and Contingencies](index=21&type=section&id=Note%2013.%20Commitments%20and%20Contingencies) The company is involved in various legal and tax proceedings, including a $33 million judgment in Singapore (appealed) and tax disputes in South Korea and Brazil. While current loss provisions are not material, an unfavorable resolution of these matters could materially impact financial statements - A judgment of approximately **$33 million** was entered against one of the company's subsidiaries in the Singapore High Court, which the company is appealing[69](index=69&type=chunk) - The company is appealing tax assessments in South Korea totaling approximately **$28.2 million** (KRW 34.3 billion) for alleged VAT invoice failures (2011-2014)[70](index=70&type=chunk) - A Brazilian subsidiary is appealing an assessment of approximately **$12.6 million** (BRL 59.6 million) related to ICMS tax rates[71](index=71&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial performance and condition for the three months ended March 31, 2022, discussing significant changes in revenue, gross profit, operating expenses, and segment-specific results, as well as liquidity and capital resources. It also includes forward-looking statements and critical accounting estimates [Forward-Looking Statements](index=23&type=section&id=Forward-Looking%20Statements) - The report contains forward-looking statements regarding future results, performance, or achievements, which are qualified by cautionary statements and risk factor disclosures[75](index=75&type=chunk) - Key risk factors include customer and counterparty creditworthiness, adverse industry conditions, sudden changes in fuel prices, acquisition integration challenges, inability to mitigate financial risks, non-compliance with debt covenants, cyber incidents, geopolitical changes (e.g., Eastern Europe conflict), and environmental regulations[77](index=77&type=chunk)[78](index=78&type=chunk) - Forward-looking statements are estimates and projections, and actual results may differ materially due to various unpredictable risks; the company disclaims any obligation to publicly update these statements unless required by law[76](index=76&type=chunk)[79](index=79&type=chunk) [Business Overview](index=25&type=section&id=Business%20Overview) - World Fuel Services is a leading global fuel services company, distributing fuel and related products and services in the aviation, land, and marine transportation industries[81](index=81&type=chunk) - The company is expanding its offerings to include energy advisory, sustainability, renewable energy solutions, and supply fulfillment for natural gas and power, aiming to become a global energy management company[81](index=81&type=chunk) - The COVID-19 pandemic significantly impacted transportation industries, though travel and economic activity are improving, some regions still face restrictions[82](index=82&type=chunk) [Reportable Segments](index=25&type=section&id=Reportable%20Segments) - Aviation segment benefited from growth in fuel and services, improving logistics, and geographic expansion, experiencing substantial recovery in global aviation volumes due to easing travel restrictions, but faced negative impacts from inventory price risk and the withdrawal of troops from Afghanistan[84](index=84&type=chunk) - Land segment is positioned for market share growth, both organically and through acquisitions (e.g., Flyers), focusing on expanding sustainability offerings via World Kinect, with results influenced by market volatility and weather conditions[85](index=85&type=chunk) - Marine segment traditionally benefits from fuel price volatility and supply uncertainty, showing improved profitability in **Q1 2022** due to increased global oil prices and related volatility, following a decline in 2020-2021 due to the COVID-19 pandemic[86](index=86&type=chunk) [Results of Operations](index=27&type=section&id=Results%20of%20Operations) [Consolidated Results of Operations](index=27&type=section&id=Consolidated%20Results%20of%20Operations) Consolidated revenue for Q1 2022 increased by 108% to $12.4 billion, driven by higher prices and volumes across all segments. Gross profit rose 21% to $230.9 million, while operating expenses increased 23% due to the Flyers acquisition and higher business activity. Net income attributable to World Fuel increased by 39.2% to $26.3 million | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :---------------------------------------- | :-------------- | :-------------- | :---------------- | :------------- | | Revenue | $12,382.0 | $5,957.9 | +$6,424.1 | +107.8% | | Gross profit | $230.9 | $191.6 | +$39.3 | +20.5% | | Operating expenses | $189.6 | $154.0 | +$35.6 | +23.1% | | Income from operations | $41.3 | $37.6 | +$3.7 | +9.8% | | Net income attributable to World Fuel | $26.3 | $18.9 | +$7.4 | +39.2% | - The increase in operating expenses was partially attributable to **$18.4 million** from Flyers' operating expenses, as well as increased compensation and employee benefits and higher general and administrative costs associated with more normalized business activity[90](index=90&type=chunk) - Net non-operating expense decreased by **$1.3 million**, primarily due to equity in earnings and foreign currency gains, partially offset by a **$5.6 million** increase in interest expense driven by incremental borrowings related to the Flyers acquisition[91](index=91&type=chunk) [Aviation Segment Results of Operations](index=28&type=section&id=Aviation%20Segment%20Results%20of%20Operations) Aviation segment revenue surged 139% to $5.0 billion in Q1 2022, driven by higher jet fuel prices (+70%) and increased volumes (+45%) as air travel recovered. However, gross profit decreased by 16% to $64.2 million, and income from operations fell 67% to $7.5 million, primarily due to inventory losses from price volatility and reduced government activity in Afghanistan | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :------------------------------------ | :-------------- | :-------------- | :---------------- | :------------- | | Revenue | $5,010.5 | $2,095.0 | +$2,915.5 | +139.2% | | Gross profit | $64.2 | $76.7 | $(12.5) | -16.3% | | Income from operations | $7.5 | $23.0 | $(15.5) | -67.4% | | Volumes (gallons) | 1,655.4 | 1,143.4 | +512.1 | +44.8% | | Average price per gallon | $2.91 | $1.72 | +$1.20 | +69.8% | - The decrease in aviation segment gross profit was primarily attributable to inventory losses driven by significant price volatility and backwardation, and the reduction in government-related activity in Afghanistan[94](index=94&type=chunk) [Land Segment Results of Operations](index=28&type=section&id=Land%20Segment%20Results%20of%20Operations) Land segment revenue doubled to $4.4 billion in Q1 2022, driven by higher average prices (+65%) and the Flyers acquisition, which also increased volumes by 21%. Gross profit increased 34% to $119.8 million, largely due to Flyers' contribution, despite reduced government activity and a decline in natural gas activities. Income from operations saw a modest 2% increase to $33.4 million | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :------------------------------------ | :-------------- | :-------------- | :---------------- | :------------- | | Revenue | $4,380.8 | $2,188.2 | +$2,192.7 | +100.2% | | Gross profit | $119.8 | $89.5 | +$30.3 | +33.8% | | Income from operations | $33.4 | $32.8 | +$0.6 | +1.8% | | Volumes (gallons) | 1,582.6 | 1,303.0 | +279.5 | +21.5% | | Average price per gallon | $2.77 | $1.68 | +$1.09 | +64.9% | - The increase in land segment gross profit was primarily attributable to Flyers' gross profit of **$36.1 million**, partially offset by reduced government-related activity in Afghanistan and a decline in natural gas activities[97](index=97&type=chunk) - Income from operations increased due to Flyers' contribution of **$17.6 million**, partially offset by reductions in gross profit from other activities and increased operating expenses[98](index=98&type=chunk) [Marine Segment Results of Operations](index=29&type=section&id=Marine%20Segment%20Results%20of%20Operations) Marine segment revenue increased 79% to $3.0 billion in Q1 2022, driven by a 61% rise in average bunker fuel prices and an 11% increase in volumes. Gross profit surged 85% to $47.0 million, and income from operations increased 264% to $23.1 million, primarily due to the impact of rising global oil prices and a constrained credit environment | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :------------------------------------ | :-------------- | :-------------- | :---------------- | :------------- | | Revenue | $2,990.6 | $1,674.7 | +$1,315.9 | +78.6% | | Gross profit | $47.0 | $25.4 | +$21.5 | +84.6% | | Income from operations | $23.1 | $6.4 | +$16.8 | +262.5% | | Volumes (metric tons) | 4.7 | 4.2 | +0.5 | +11.9% | | Average price per metric ton | $637.61 | $395.65 | +$241.96 | +61.2% | - The increase in marine segment gross profit and income from operations was principally attributable to the impact of the rise in global oil prices and the resulting constrained credit environment[100](index=100&type=chunk)[101](index=101&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity, comprising cash and Credit Facility availability, is deemed sufficient for the next twelve months. Operating cash flow decreased significantly due to increased working capital needs from higher fuel prices and volumes, while investing activities were dominated by the Flyers acquisition. Financing activities provided substantial cash through increased borrowings [Sources of Liquidity and Factors Impacting Our Liquidity](index=29&type=section&id=Sources%20of%20Liquidity%20and%20Factors%20Impacting%20Our%20Liquidity) - The company's liquidity, consisting principally of cash and availability under its Credit Facility, is believed to be sufficient to fund working capital and capital expenditure requirements for at least the next twelve months[103](index=103&type=chunk)[104](index=104&type=chunk) - The Credit Facility was amended on April 1, 2022, increasing total borrowing capacity to **$2.0 billion** and extending maturity to April 1, 2027, but availability is limited by a consolidated total leverage ratio of not more than **4.75 to 1**[105](index=105&type=chunk) - The company sold **$2.6 billion** in qualifying accounts receivable under Receivable Purchase Agreements (RPAs) during Q1 2022 (vs. **$2.0 billion** in Q1 2021)[107](index=107&type=chunk) [Future Uses of Liquidity](index=30&type=section&id=Future%20Uses%20of%20Liquidity) - Cash is primarily used to fund working capital, strategic acquisitions, and investments, with no material changes in expected future uses of liquidity from December 31, 2021, to March 31, 2022[108](index=108&type=chunk) [Cash Flows](index=30&type=section&id=Cash%20Flows) | Cash Flow Activity | 2022 (Millions) | 2021 (Millions) | Change (Millions) | | :---------------------------------- | :-------------- | :-------------- | :---------------- | | Net cash provided by (used in) operating activities | $(72.0) | $103.4 | $(175.4) | | Net cash provided by (used in) investing activities | $(657.3) | $(2.7) | $(654.6) | | Net cash provided by (used in) financing activities | $343.7 | $(20.8) | +$364.5 | - Net cash used in operating activities was **$72.0 million** in Q1 2022, a **$175.4 million** decrease from Q1 2021, principally due to a **$161.6 million** increase in working capital driven by higher fuel prices and increased volumes[110](index=110&type=chunk) - Net cash used in investing activities was **$657.3 million**, primarily driven by **$639.4 million** for the Flyers acquisition and **$14.6 million** for capital expenditures[111](index=111&type=chunk) - Net cash provided by financing activities was **$343.7 million**, mainly from a **$380.3 million** net increase in borrowings related to the Flyers acquisition, partially offset by **$13.7 million** in common stock repurchases and **$7.4 million** in dividend payments[112](index=112&type=chunk) [Critical Accounting Estimates](index=31&type=section&id=Critical%20Accounting%20Estimates) - There have been no material changes to the Critical Accounting Estimates disclosed in the 2021 10-K report[114](index=114&type=chunk) - Based on assessments as of March 31, 2022, the carrying value of long-lived assets and equity investments were recoverable, and the fair value of land and aviation reporting units were not less than their respective carrying values, considering current market volatility and geopolitical risks[115](index=115&type=chunk)[116](index=116&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=31&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) There have been no material changes to the company's exposures to commodity price, interest rate, or foreign currency risk since December 31, 2021 - There have been no material changes to the company's exposures to commodity price, interest rate, or foreign currency risk since December 31, 2021[117](index=117&type=chunk) [Item 4. Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures as of March 31, 2022, and concluded they were effective at a reasonable assurance level. There were no material changes in internal control over financial reporting during the quarter [Management's Evaluation of Disclosure Controls and Procedures](index=31&type=section&id=Management%27s%20Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) - The CEO and CFO concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2022[119](index=119&type=chunk) [Changes in Internal Control over Financial Reporting](index=31&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) - There were no changes in internal control over financial reporting that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting during the three months ended March 31, 2022[120](index=120&type=chunk) [Part II. Other Information](index=33&type=section&id=Part%20II.%20Other%20Information) [Item 1. Legal Proceedings](index=33&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various tax and commercial legal proceedings in multiple countries, including Brazil, Denmark, South Korea, and the U.S. While no current claim is expected to have a material adverse effect, an unfavorable resolution of any matter could be material to financial statements - The company is under review by tax authorities and involved in various inquiries, audits, challenges, and litigation in countries including Brazil, Denmark, South Korea, and the U.S., where the amounts under controversy may be material[123](index=123&type=chunk) - Currently, the company is not a party to any claim, complaint, or proceeding that is expected to have a material adverse effect on its business or financial condition, but an adverse resolution of one or more such matters could be material[124](index=124&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=33&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 500 thousand shares of common stock in March 2022 at an average price of $27.41 per share. As of March 31, 2022, approximately $182.1 million remained available under the $200.0 million 2020 Repurchase Program | Period | Total Number of Shares Purchased (Thousands) | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (Thousands) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (Millions) | | :-------------------- | :----------------------------------------- | :--------------------------- | :----------------------------------------------------------------------------------------- | :------------------------------------------------------------------------------------------------ | | 3/1/2022 - 3/31/2022 | 500 | $27.41 | 500 | $182.053 | | **Total** | **500** | **$27.41** | **500** | **$182.053** | - As of March 31, 2022, approximately **$182.1 million** remained available for purchase under the **$200.0 million** 2020 Repurchase Program, which has no expiration date[125](index=125&type=chunk) [Item 6. Exhibits](index=34&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the 10-Q Report, including certifications from the CEO and CFO (Rule 13a-14(a) and Section 906 of Sarbanes-Oxley Act) and XBRL formatted financial statements - Key exhibits include certifications from the Chief Executive Officer and Chief Financial Officer (pursuant to Rule 13a-14(a) and Section 906 of the Sarbanes-Oxley Act of 2002) and XBRL formatted financial statements[127](index=127&type=chunk) [Signatures](index=35&type=section&id=Signatures) The report was duly signed on April 29, 2022, by Michael J. Kasbar, Chairman, President and Chief Executive Officer, and Ira M. Birns, Executive Vice President and Chief Financial Officer, pursuant to the requirements of the Securities Exchange Act of 1934 - The report was signed on April 29, 2022, by Michael J. Kasbar, Chairman, President and Chief Executive Officer, and Ira M. Birns, Executive Vice President and Chief Financial Officer[130](index=130&type=chunk)

Part I [Item 1. Business](index=4&type=section&id=Item%201.%20Business) World Fuel Services is a global fuel and energy management company serving aviation, land, and marine sectors, subject to competition and regulation - The company's core business is the distribution of fuel and related products and services across the aviation, land, and marine transportation sectors[10](index=10&type=chunk) - A key strategic goal is to transition into a leading global energy management company, expanding offerings to include energy advisory, management services, technology solutions, and sustainability products like renewable fuels[10](index=10&type=chunk) - The company operates through three reportable segments: Aviation, Land, and Marine[14](index=14&type=chunk) - The business is highly competitive, fragmented, and subject to seasonal variability, with higher demand for aviation/land fuel in summer and heating oil/natural gas in winter[29](index=29&type=chunk)[30](index=30&type=chunk) - Operations are subject to substantial environmental and climate change regulations globally, which could impose significant costs and affect demand for hydrocarbon products[31](index=31&type=chunk)[34](index=34&type=chunk)[36](index=36&type=chunk) [Aviation Segment](index=4&type=section&id=Aviation%20Segment) - Provides global aviation fuel supply and comprehensive services to a wide range of customers including commercial airlines, cargo carriers, corporate fleets, and government/military clients[17](index=17&type=chunk)[18](index=18&type=chunk) - Service offerings include fuel management, price risk management, ground handling, dispatch services, and trip planning[17](index=17&type=chunk) - The company is actively working to increase the availability of Sustainable Aviation Fuel (SAF) to support the energy transition[20](index=20&type=chunk) [Land Segment](index=5&type=section&id=Land%20Segment) - Offers fuel, heating oil, propane, natural gas, and lubricants to fuel distributors, retail operators, and industrial, commercial, and government customers, primarily in the U.S., U.K., and Brazil[21](index=21&type=chunk) - Expanded offerings include renewable diesel, biodiesel, and renewable natural gas, alongside energy advisory and sustainability solutions through its World Kinect brand[21](index=21&type=chunk) - On January 3, 2022, the company acquired Flyers Energy Group, significantly expanding its transportation, commercial fueling, and lubricants distribution operations[24](index=24&type=chunk) [Marine Segment](index=5&type=section&id=Marine%20Segment) - Markets fuel, lubricants, and related services to marine customers such as container fleets, cruise lines, and governments[25](index=25&type=chunk) - Services include fuel procurement management, price risk management, quality control, and claims management[25](index=25&type=chunk) - The segment is actively working to develop a sustainable marine fuel supply chain and identify lower carbon alternatives[26](index=26&type=chunk) [Human Capital Resources](index=8&type=section&id=Human%20Capital%20Resources) - The company emphasizes employee investment through diversity and inclusion initiatives, professional development, and a focus on health, safety, and well-being[39](index=39&type=chunk) - In response to COVID-19, the company implemented business continuity plans, maximized remote work, and expanded employee assistance programs[42](index=42&type=chunk) - Diversity initiatives aim to increase representation of minorities, military veterans, and women in senior management, supported by training and diverse interview panels[43](index=43&type=chunk) [Item 1A. Risk Factors](index=11&type=section&id=Item%201A.%20Risk%20Factors) Significant risks include customer credit, fuel price volatility, operational, cybersecurity, and climate change regulations - The company is exposed to significant customer credit risk, as it extends unsecured credit to customers in the aviation, land, and marine industries, which are vulnerable to global events like the COVID-19 pandemic[54](index=54&type=chunk)[55](index=55&type=chunk) - Fuel price volatility is a major risk, impacting working capital requirements, customer credit limits, inventory valuation, and competitive dynamics[56](index=56&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk) - Cybersecurity attacks on IT systems or critical infrastructure (like pipelines) could disrupt operations, compromise data, and result in significant financial and reputational damage[74](index=74&type=chunk)[75](index=75&type=chunk) - Climate change regulations, such as GHG emission limits and mandates for renewable energy, could increase operating costs and reduce demand for traditional fuel products[89](index=89&type=chunk)[92](index=92&type=chunk) - The COVID-19 pandemic has had, and is expected to continue to have, adverse effects on the business through reduced fuel demand, supply chain disruptions, and customer liquidity issues[109](index=109&type=chunk)[110](index=110&type=chunk)[111](index=111&type=chunk) [Item 1B. Unresolved Staff Comments](index=22&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - None[123](index=123&type=chunk) [Item 2. Properties](index=22&type=section&id=Item%202.%20Properties) Principal properties are leased administrative offices and storage facilities, including headquarters in Miami, London, and Singapore - The company's main properties are leased administrative offices and inventory storage facilities, with none being individually material[124](index=124&type=chunk) - Corporate headquarters are leased in Miami, Florida, with other strategic offices in London and Singapore[124](index=124&type=chunk) [Item 3. Legal Proceedings](index=22&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in tax inquiries and ordinary litigation, with material controversies in Brazil, Denmark, and South Korea - The company is under review by tax authorities in multiple countries, with material controversies in Brazil, Denmark, and South Korea[126](index=126&type=chunk) - The company is also a party to various ordinary course claims, including environmental, commercial, and governmental contract claims, which are not currently expected to be materially adverse[127](index=127&type=chunk) [Item 4. Mine Safety Disclosures](index=23&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Not applicable - Not applicable[128](index=128&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities](index=23&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Shareholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Common stock trades on NYSE; 923,403 shares repurchased for $26.1 million in Q4 2021, with $195.8 million remaining for repurchase | Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares That May Yet Be Purchased Under Repurchase Programs | | :--- | :--- | :--- | :--- | :--- | | 10/1/2021 - 10/31/2021 | 250,000 | $32.28 | 250,000 | $213,786,194 | | 11/1/2021 - 11/30/2021 | 408,803 | $27.00 | 408,803 | $202,749,436 | | 12/1/2021 - 12/31/2021 | 264,600 | $26.39 | 264,600 | $195,766,982 | | **Total** | **923,403** | **$28.25** | **923,403** | **$195,766,982** | - As of December 31, 2021, approximately **$195.8 million** remains available for purchase under the 2020 Repurchase Program[134](index=134&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) FY2021 revenue increased to $31.3 billion, but gross profit and net income declined, with sufficient liquidity maintained [Consolidated Results of Operations](index=27&type=section&id=Consolidated%20Results%20of%20Operations) | Metric | 2021 | 2020 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $31,337.0 M | $20,358.3 M | 54% | | Gross Profit | $788.2 M | $851.8 M | -7% | | Income from Operations | $142.6 M | $137.9 M | 3% | | Net Income | $73.7 M | $109.6 M | -33% | | Diluted EPS | $1.16 | $1.71 | -32% | - The **54% increase in revenue** was driven by higher average fuel prices across all segments[147](index=147&type=chunk) - The **7% decrease in gross profit** was due to declines of **$51.1 million** in the marine segment and **$46.5 million** in the land segment, partially offset by a **$34.0 million** increase in the aviation segment[148](index=148&type=chunk) - Operating expenses decreased by **10%** primarily due to a lower provision for credit losses and the absence of a 2020 impairment charge, partially offset by higher incentive compensation[149](index=149&type=chunk) - The significant decrease in net non-operating income was primarily attributable to the gain on the sale of MSTS recognized in 2020[150](index=150&type=chunk) [Aviation Segment Results](index=28&type=section&id=Aviation%20Segment%20Results) | Metric | 2021 | 2020 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $12,824.3 M | $8,179.6 M | 57% | | Gross Profit | $386.9 M | $352.9 M | 10% | | Income from Operations | $163.4 M | $84.5 M | 93% | | Volume (gallons) | 5,857.5 M | 4,694.1 M | 25% | | Avg. Price per Gallon | $2.08 | $1.46 | 43% | - Revenue growth was driven by a **43% increase** in average jet fuel prices and a **25% increase** in volumes as travel restrictions eased[152](index=152&type=chunk) - Gross profit increased due to the recovery in passenger air travel, partially offset by reduced government activity in Afghanistan and the sale of MSTS[153](index=153&type=chunk) - The **93% surge in income from operations** was due to higher gross profit combined with a **$46.4 million** reduction in the provision for credit losses[154](index=154&type=chunk) [Land Segment Results](index=28&type=section&id=Land%20Segment%20Results) | Metric | 2021 | 2020 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $10,426.8 M | $6,663.1 M | 56% | | Gross Profit | $301.1 M | $347.6 M | -13% | | Income from Operations | $44.6 M | $72.6 M | -38% | | Volume (gallons) | 5,254.1 M | 5,062.8 M | 4% | | Avg. Price per Gallon | $1.98 | $1.30 | 52% | - Revenue increased primarily due to a **52% rise** in average fuel prices[156](index=156&type=chunk) - The decline in gross profit was mainly attributable to the sale of MSTS, reduced government activity in Afghanistan, and lower demand in the U.K[157](index=157&type=chunk) [Marine Segment Results](index=29&type=section&id=Marine%20Segment%20Results) | Metric | 2021 | 2020 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $8,085.8 M | $5,515.7 M | 47% | | Gross Profit | $100.3 M | $151.4 M | -34% | | Income from Operations | $20.7 M | $58.5 M | -65% | | Volume (metric tons) | 18.4 M | 17.5 M | 6% | | Avg. Price per Metric Ton | $438.31 | $315.74 | 39% | - Revenue growth was driven by a **39% increase** in the average price per metric ton of bunker fuel[159](index=159&type=chunk) - Gross profit decreased significantly due to highly competitive market conditions in 2021, compared to strong results in H1 2020 which benefited from the implementation of IMO 2020 regulations[160](index=160&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) - The company believes cash on hand (**$652.2 million** as of Dec 31, 2021), available funds from its Credit Facility, and operating cash flows are sufficient to fund working capital and capital expenditures for at least the next twelve months[167](index=167&type=chunk)[250](index=250&type=chunk) | Cash Flow Activity (in millions) | 2021 | 2020 | | :--- | :--- | :--- | | Net cash from operating activities | $173.2 | $604.1 | | Net cash from investing activities | ($58.3) | $72.8 | | Net cash from financing activities | ($113.6) | ($213.0) | - The decrease in operating cash flow was principally due to a **$451.3 million** increase in net working capital resulting from business recovery and higher fuel prices compared to 2020[182](index=182&type=chunk) - On January 3, 2022, the company closed the acquisition of Flyers for total consideration of **$792.7 million**, funded by cash on hand and incremental borrowings[176](index=176&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=34&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages commodity price, foreign currency, and interest rate risks using derivative contracts and hedging strategies - The company uses derivative instruments (futures, forwards, swaps, options) to manage commodity price risk inherent in the purchase and sale of fuel[207](index=207&type=chunk) - Foreign currency exchange risk from international operations is economically hedged using forward and swap contracts; a hypothetical **10% change** in exchange rates is not expected to have a material impact on income from operations[209](index=209&type=chunk) - The company has interest rate risk from its floating-rate Credit Facility and Term Loans; a **1% fluctuation** in interest rates would result in a **$4.8 million** change in annual interest expense[211](index=211&type=chunk) - A **$300 million** interest rate swap agreement is in place to effectively lock in the variable interest rate on a portion of its Eurodollar rate loans at **0.55%**, maturing in March 2025[212](index=212&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=37&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes or disagreements with its accountants on accounting and financial disclosure - None[215](index=215&type=chunk) [Item 9A. Controls and Procedures](index=37&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management confirmed effective disclosure controls and internal control over financial reporting as of December 31, 2021, with no material changes - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of December 31, 2021[217](index=217&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of December 31, 2021, based on the COSO framework[220](index=220&type=chunk) - There were no material changes in internal control over financial reporting during the quarter ended December 31, 2021[222](index=222&type=chunk) Part III [Items 10, 11, 12, 13, and 14](index=39&type=section&id=Items%2010%2C%2011%2C%2012%2C%2013%2C%20and%2014) Information for Items 10-14 (directors, executive compensation, security ownership) is incorporated by reference from the 2022 Proxy Statement - Information regarding directors, executive officers, corporate governance, executive compensation, security ownership, related transactions, and principal accounting fees is incorporated by reference from the 2022 Proxy Statement[228](index=228&type=chunk)[229](index=229&type=chunk)[230](index=230&type=chunk) Part IV [Item 15. Exhibits, Financial Statement Schedules](index=40&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section presents the company's consolidated financial statements for FY2021, including balance sheets, income, equity, and cash flow statements [Consolidated Financial Statements](index=45&type=section&id=Consolidated%20Financial%20Statements) | (In millions) | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | **Assets** | | | | Total Current Assets | $4,019.7 | $2,639.3 | | Total Assets | $5,942.4 | $4,500.3 | | **Liabilities & Equity** | | | | Total Current Liabilities | $3,096.7 | $1,684.0 | | Total Liabilities | $4,025.6 | $2,587.4 | | Total Equity | $1,916.8 | $1,912.9 | | Total Liabilities & Equity | $5,942.4 | $4,500.3 | | (In millions, except per share data) | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Revenue | $31,337.0 | $20,358.3 | $36,819.0 | | Gross Profit | $788.2 | $851.8 | $1,112.0 | | Income from Operations | $142.6 | $137.9 | $299.7 | | Net Income | $73.7 | $109.6 | $178.9 | | Diluted EPS | $1.16 | $1.71 | $2.69 | [Note 2. Accounts Receivable](index=58&type=section&id=Note%202.%20Accounts%20Receivable) | Allowance for Expected Credit Losses (in millions) | 2021 | 2020 | | :--- | :--- | :--- | | Balance as of January 1 | $57.3 | $46.6 | | Charges to allowance | $6.3 | $63.7 | | Write-offs | ($35.3) | ($53.7) | | Recoveries | $1.4 | $1.0 | | **Balance as of December 31** | **$29.8** | **$57.3** | - The company sold **$9.2 billion** of receivables under its RPA programs in 2021, compared to **$4.3 billion** in 2020[313](index=313&type=chunk) [Note 3. Acquisitions and Divestitures](index=59&type=section&id=Note%203.%20Acquisitions%20and%20Divestitures) - On January 3, 2022, the company acquired Flyers Energy Group for total consideration of **$792.7 million**, consisting of **$642.7 million** in cash, **$50.0 million** in common stock, and a **$100.0 million** holdback[315](index=315&type=chunk) - In 2020, the company completed the sale of its Multi Service payment solutions business (MSTS) for gross cash proceeds of **$303.5 million**, resulting in a pre-tax gain of **$80.0 million**[318](index=318&type=chunk) [Note 5. Restructuring](index=64&type=section&id=Note%205.%20Restructuring) - In 2020, the company initiated a restructuring program focused on streamlining operations, particularly in the land business; the program was completed in Q4 2021[335](index=335&type=chunk) - The company incurred incremental restructuring charges of **$6.6 million** in 2021, primarily for consulting fees and severance costs[336](index=336&type=chunk) - In 2020, a global office rationalization initiative resulted in an **$18.6 million** impairment charge related to abandoned office leases[338](index=338&type=chunk) [Note 8. Debt, Interest Income, Expense and Other Finance Costs](index=67&type=section&id=Note%208.%20Debt%2C%20Interest%20Income%2C%20Expense%20and%20Other%20Finance%20Costs) | Debt Component (in millions) | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | Credit Facility | $0.0 | $0.0 | | Term Loans | $484.1 | $503.2 | | Finance leases | $21.2 | $18.2 | | Other | $3.3 | $3.3 | | **Total Debt** | **$508.7** | **$524.7** | - As of December 31, 2021, the company had no outstanding borrowings under its **$1.3 billion** Credit Facility and had **$1.2 billion** of unused capacity[347](index=347&type=chunk)[348](index=348&type=chunk) [Note 11. Income Taxes](index=73&type=section&id=Note%2011.%20Income%20Taxes) | Reconciliation of U.S. Statutory Rate to Effective Rate | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | U.S. federal statutory tax rate | 21.0% | 21.0% | 21.0% | | Foreign earnings, net of foreign taxes | (10.3%) | (13.3%) | (13.8%) | | State income taxes, net | 3.2% | 1.3% | 2.2% | | Tax Reform - GILTI | 8.8% | 0.5% | 6.0% | | Uncertain tax positions | 5.3% | 6.8% | 8.2% | | Valuation allowance | (8.0%) | 10.6% | 1.2% | | Other, net | 5.8% | 5.3% | (1.1%) | | **Effective income tax rate** | **25.8%** | **32.2%** | **23.7%** | - The company has material tax examinations in progress in Denmark (2013-2019), South Korea (2011-2014), and the U.S. (2017-2019)[393](index=393&type=chunk) - As of December 31, 2021, the company had gross Unrecognized Tax Liabilities of **$98.2 million**, including penalties and interest[389](index=389&type=chunk) [Note 13. Business Segments, Geographic Information and Major Customers](index=81&type=section&id=Note%2013.%20Business%20Segments%2C%20Geographic%20Information%20and%20Major%20Customers) | Income from Operations by Segment (in millions) | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Aviation segment | $163.4 | $84.5 | $283.9 | | Land segment | $44.6 | $72.6 | $55.0 | | Marine segment | $20.7 | $58.5 | $67.1 | | Corporate overhead - unallocated | ($86.1) | ($77.8) | ($106.4) | | **Total income from operations** | **$142.6** | **$137.9** | **$299.7** | - Sales to government customers, particularly NATO in Afghanistan, accounted for a material portion of profitability in recent years, but this activity materially declined and concluded in Q3 2021 with the withdrawal of troops[414](index=414&type=chunk)

```markdown [Part I. Financial Information](index=4&type=section&id=Part%20I.%20Financial%20Information) This part provides the unaudited financial statements and management's analysis of financial condition and operations [Item 1. Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements, including balance sheets, income statements, statements of shareholders' equity, and cash flow statements, along with detailed notes explaining the basis of presentation, significant accounting policies, and specific financial line items [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Presents the company's financial position, including assets, liabilities, and equity, at specific dates Condensed Consolidated Balance Sheets (in millions) | Metric | Sep 30, 2021 | Dec 31, 2020 | Change ($) | Change (%) | | :----------------------------------- | :----------- | :----------- | :--------- | :--------- | | Total Assets | $5,544.3 | $4,500.3 | $1,044.0 | 23.2% | | Current Assets | $3,693.2 | $2,639.3 | $1,053.9 | 39.9% | | Cash and cash equivalents | $796.0 | $658.8 | $137.2 | 20.8% | | Accounts receivable, net | $2,032.5 | $1,238.4 | $794.1 | 64.1% | | Inventories | $439.3 | $344.3 | $95.0 | 27.6% | | Total Liabilities | $3,620.5 | $2,587.4 | $1,033.1 | 39.9% | | Current Liabilities | $2,696.5 | $1,684.0 | $1,012.5 | 60.1% | | Accounts payable | $2,024.3 | $1,214.7 | $809.6 | 66.7% | | Total Equity | $1,923.8 | $1,912.9 | $10.9 | 0.6% | [Condensed Consolidated Statements of Income and Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) Details the company's revenues, expenses, and net income over specific reporting periods Condensed Consolidated Statements of Income (in millions, except per share data) | Metric | 3 Months Ended Sep 30, 2021 | 3 Months Ended Sep 30, 2020 | Change ($) | Change (%) | | :----------------------------------- | :-------------------------- | :-------------------------- | :--------- | :--------- | | Revenue | $8,350.9 | $4,482.7 | $3,868.2 | 86.3% | | Gross profit | $197.5 | $214.0 | $(16.5) | -7.7% | | Income from operations | $41.7 | $38.8 | $2.9 | 7.5% | | Net income attributable to World Fuel | $21.7 | $82.0 | $(60.3) | -73.5% | | Diluted earnings per common share | $0.34 | $1.29 | $(0.95) | -73.6% | | Metric | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | Change ($) | Change (%) | | :----------------------------------- | :-------------------------- | :-------------------------- | :--------- | :--------- | | Revenue | $21,394.2 | $15,656.2 | $5,738.0 | 36.6% | | Gross profit | $573.0 | $686.6 | $(113.6) | -16.5% | | Income from operations | $110.2 | $121.5 | $(11.3) | -9.3% | | Net income attributable to World Fuel | $58.2 | $113.1 | $(54.9) | -48.5% | | Diluted earnings per common share | $0.92 | $1.76 | $(0.84) | -47.7% | [Condensed Consolidated Statements of Shareholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Shareholders'%20Equity) Outlines changes in the company's equity, reflecting net income, dividends, and stock transactions Shareholders' Equity Changes (in millions) | Metric | Dec 31, 2020 | Sep 30, 2021 | | :----------------------------------- | :----------- | :----------- | | Total World Fuel shareholders' equity | $1,909.3 | $1,919.7 | **Key Activities (9 Months Ended Sep 30, 2021):** * Net income: $58.2 million * Cash dividends declared: $(22.6) million (3 x $7.5M/$7.6M) * Amortization of share-based payment awards: $15.3 million * Purchases of common stock: $(24.4) million * Other comprehensive income (loss): $(11.0) million - The Company declared quarterly cash dividends of **$0.12** per common share for the nine months ended September 30, 2021, totaling **$22.6 million**, an increase from **$0.10** per common share (**$19.1 million** total) in the prior year period[17](index=17&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Summarizes cash inflows and outflows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (9 Months Ended Sep 30, in millions) | Cash Flow Category | 2021 | 2020 | Change ($) | Change (%) | | :----------------------------------- | :----- | :----- | :--------- | :--------- | | Net cash provided by operating activities | $223.3 | $490.6 | $(267.3) | -54.5% | | Net cash used in investing activities | $(9.8) | $86.9 | $(96.7) | -111.3% | | Net cash used in financing activities | $(70.3) | $(188.8) | $118.5 | 62.8% | | Net increase in cash and cash equivalents | $137.2 | $386.0 | $(248.8) | -64.5% | | Cash and cash equivalents, end of period | $796.0 | $572.0 | $224.0 | 39.2% | [Notes to the Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed explanations and disclosures supporting the condensed consolidated financial statements [1. Basis of Presentation, New Accounting Standards, and Significant Accounting Policies](index=9&type=section&id=1.%20Basis%20of%20Presentation,%20New%20Accounting%20Standards,%20and%20Significant%20Accounting%20Policies) Explains the foundational principles, new accounting standards, and significant policies used in financial reporting - World Fuel Services Corporation is a global fuel services company distributing fuel and related products in aviation, land, and marine transportation industries, with an intention to become a leading global energy management company offering sustainability and renewable energy solutions[23](index=23&type=chunk) - The COVID-19 pandemic significantly impacted global economy and transportation industries, leading to a substantial decline in business activity for many customers, especially commercial airlines, though travel and economic activity have begun to improve in certain regions[26](index=26&type=chunk) - No accounting standards adopted in **2021** had a material impact on the financial statements The Company is evaluating the impact of Reference Rate Reform (LIBOR transition) but does not anticipate a material impact[27](index=27&type=chunk)[28](index=28&type=chunk) [2. Accounts Receivable](index=10&type=section&id=2.%20Accounts%20Receivable) Details the composition of accounts receivable and the allowance for expected credit losses Accounts Receivable and Allowance for Credit Losses (in millions) | Metric | Sep 30, 2021 | Dec 31, 2020 | | :----------------------------------- | :----------- | :----------- | | Accounts receivable | $2,032.5 | $1,238.4 | | Allowance for expected credit losses | $29.2 | $57.3 | Allowance for Expected Credit Losses Activity (9 Months Ended Sep 30, in millions) | Activity | 2021 | 2020 | | :----------------------------------- | :----- | :----- | | Balance as of January 1 | $57.3 | $46.6 | | Charges to allowance for credit losses | $2.8 | $57.9 | | Write-off of uncollectible receivables | $(32.4) | $(53.1) | | Balance as of September 30 | $29.2 | $51.8 | - The Company sold receivables with an aggregate face value of **$6.8 billion** during the nine months ended September 30, 2021, compared to **$2.6 billion** in the same period of 2020, incurring fees of **$14.6 million** and **$6.8 million**, respectively[36](index=36&type=chunk) [3. Acquisitions and Divestitures](index=11&type=section&id=3.%20Acquisitions%20and%20Divestitures) Reports on significant business acquisitions and dispositions, including their financial impact - The Company entered into a definitive agreement on October 28, 2021, to acquire Flyers Energy Group for **$773 million**, with closing expected within **60** to **90** days[37](index=37&type=chunk) - In Q1 2020, the Company acquired the UVair fuel business for **$159.0 million**[38](index=38&type=chunk) - The sale of the Multi Service payment solutions business (MSTS) on September 30, 2020, generated gross cash proceeds of **$303.5 million** at closing and a pre-tax gain of **$80.0 million**[39](index=39&type=chunk) [4. Derivative Instruments](index=11&type=section&id=4.%20Derivative%20Instruments) Describes the company's use of derivative financial instruments for risk management purposes - The Company uses derivative instruments for risk management, including fair value hedges (inventory price risk), cash flow hedges (price and interest rate volatility), and non-designated derivatives (market price fluctuations, currency rate hedging)[40](index=40&type=chunk)[41](index=41&type=chunk) Gross Notional Values of Derivative Contracts (Sep 30, 2021, in millions) | Contract Type | Unit | Value | | :-------------------------- | :--- | :---- | | Commodity contracts (Long) | BBL | 54.8 | | Commodity contracts (Short) | BBL | (48.9) | | Foreign currency (Sell USD) | USD | (171.9) | | Foreign currency (Buy USD) | USD | 254.1 | | Interest rate swap | USD | 300.0 | Total Gross Fair Value of Derivative Instruments (in millions) | Metric | Sep 30, 2021 | Dec 31, 2020 | | :----------------------------------- | :----------- | :----------- | | Total derivatives assets | $765.3 | $378.5 | | Total derivatives liabilities | $783.1 | $349.0 | [5. Debt, Interest Income, Expense, and Other Finance Costs](index=15&type=section&id=5.%20Debt,%20Interest%20Income,%20Expense,%20and%20Other%20Finance%20Costs) Outlines the company's outstanding debt, interest income, and related finance costs Outstanding Debt (in millions) | Debt Type | Sep 30, 2021 | Dec 31, 2020 | | :----------------------------------- | :----------- | :----------- | | Term loans | $490.5 | $503.2 | | Finance leases | $20.4 | $18.0 | | Other | $3.4 | $3.0 | | Total debt | $514.3 | $524.2 | | Long-term debt | $484.2 | $501.8 | Interest Income (Expense), Net (in millions) | Period | 2021 | 2020 | | :----------------------------------- | :----- | :----- | | 3 Months Ended Sep 30 | $(10.4) | $(8.7) | | 9 Months Ended Sep 30 | $(29.2) | $(34.1) | [6. Fair Value Measurements](index=15&type=section&id=6.%20Fair%20Value%20Measurements) Presents assets and liabilities measured at fair value and the methodologies used for valuation Total Assets at Fair Value (in millions) | Metric | Sep 30, 2021 | Dec 31, 2020 | | :----------------------------------- | :----------- | :----------- | | Commodities contracts | $758.4 | $371.0 | | Foreign currency contracts | $4.5 | $7.5 | | Interest rate contract | $2.4 | $0.0 | | Total assets at fair value | $779.4 | $389.9 | Total Liabilities at Fair Value (in millions) | Metric | Sep 30, 2021 | Dec 31, 2020 | | :----------------------------------- | :----------- | :----------- | | Commodities contracts | $777.8 | $326.0 | | Interest rate contract | $1.3 | $3.7 | | Foreign currency contracts | $4.0 | $19.8 | | Total liabilities at fair value | $783.1 | $349.5 | - The Company's individual over-the-counter (OTC) counterparty exposure is managed within predetermined credit limits As of September 30, 2021, two counterparties represented over **10%** of the credit exposure to OTC derivative counterparties, totaling **$51.9 million**[58](index=58&type=chunk) - An asset impairment of **$4.7 million** was recognized during the nine months ended September 30, 2021, related to certain long-lived assets within the land segment, measured using an income approach (Level 3 inputs)[59](index=59&type=chunk) [7. Revenue from Contracts with Customers](index=18&type=section&id=7.%20Revenue%20from%20Contracts%20with%20Customers) Provides a breakdown of revenue generated from contracts with customers by geographic area Revenue by Geographic Area (in millions) | Region | 3 Months Ended Sep 30, 2021 | 3 Months Ended Sep 30, 2020 | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | | :----------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Asia Pacific | $1,071.4 | $610.8 | $2,804.6 | $2,339.9 | | EMEA | $1,863.7 | $1,096.1 | $4,706.6 | $3,721.1 | | LATAM | $882.3 | $354.5 | $2,203.9 | $1,534.4 | | North America | $4,578.1 | $2,260.5 | $11,709.9 | $7,478.1 | | Other revenues (excluded from ASC 606) | $(44.7) | $160.8 | $(30.8) | $582.8 | | **Total Revenue** | **$8,350.9** | **$4,482.7** | **$21,394.2** | **$15,656.2** | [8. Income Taxes](index=18&type=section&id=8.%20Income%20Taxes) Details the company's income tax provision, effective tax rates, and significant tax contingencies Income Tax Provision and Effective Rate (in millions, except rates) | Metric | 3 Months Ended Sep 30, 2021 | 3 Months Ended Sep 30, 2020 | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | | :----------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Income tax provision | $10.0 | $25.4 | $20.8 | $49.0 | | Effective income tax rate | 30.9% | 23.5% | 26.1% | 30.2% | - The 3-month effective tax rate increased to **30.9%** in **2021** from **23.5%** in **2020**, primarily due to a **$1.1 million** net discrete tax benefit in **2021** compared to a **$16.1 million** tax expense on the MSTS sale and a **$2.7 million** net discrete tax expense in **2020**[62](index=62&type=chunk) - The Company is currently appealing tax assessments in Denmark (approx **$15.0 million** for **2015**) and South Korea (revised aggregate **$9.0 million** for **2011-2014**), believing them to be without merit[66](index=66&type=chunk)[67](index=67&type=chunk) [9. Business Segments](index=19&type=section&id=9.%20Business%20Segments) Reports financial performance and assets for the company's distinct operating segments Revenue by Reportable Segment (in millions) | Segment | 3 Months Ended Sep 30, 2021 | 3 Months Ended Sep 30, 2020 | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | | :----------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Aviation | $3,579.7 | $1,596.2 | $8,480.5 | $6,381.0 | | Land | $2,670.4 | $1,645.2 | $7,315.8 | $4,948.8 | | Marine | $2,100.7 | $1,241.2 | $5,597.8 | $4,326.4 | | **Total Revenue** | **$8,350.9** | **$4,482.7** | **$21,394.2** | **$15,656.2** | Gross Profit by Reportable Segment (in millions) | Segment | 3 Months Ended Sep 30, 2021 | 3 Months Ended Sep 30, 2020 | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | | :----------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Aviation | $113.0 | $97.6 | $277.1 | $282.6 | | Land | $62.6 | $84.3 | $225.9 | $275.4 | | Marine | $21.9 | $32.0 | $70.0 | $128.6 | | **Total Gross Profit** | **$197.5** | **$214.0** | **$573.0** | **$686.6** | Income from Operations by Reportable Segment (in millions) | Segment | 3 Months Ended Sep 30, 2021 | 3 Months Ended Sep 30, 2020 | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | | :----------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Aviation | $57.0 | $29.2 | $114.0 | $67.3 | | Land | $3.7 | $18.8 | $44.5 | $54.1 | | Marine | $3.6 | $8.2 | $14.8 | $55.4 | | Corporate overhead - unallocated | $(22.6) | $(17.4) | $(63.1) | $(55.3) | | **Total Income from Operations** | **$41.7** | **$38.8** | **$110.2** | **$121.5** | Total Assets by Reportable Segment (in millions) | Segment | Sep 30, 2021 | Dec 31, 2020 | | :----------------------------------- | :----------- | :----------- | | Aviation | $2,222.8 | $1,789.5 | | Land | $1,780.3 | $1,459.5 | | Marine | $981.2 | $667.6 | | Corporate | $560.1 | $583.7 | | **Total Assets** | **$5,544.3** | **$4,500.3** | [10. Earnings per Common Share](index=21&type=section&id=10.%20Earnings%20per%20Common%20Share) Calculates basic and diluted earnings per common share based on net income and outstanding shares Earnings per Common Share (in millions, except per share amounts) | Metric | 3 Months Ended Sep 30, 2021 | 3 Months Ended Sep 30, 2020 | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | | :----------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net income attributable to World Fuel | $21.7 | $82.0 | $58.2 | $113.1 | | Basic earnings per common share | $0.34 | $1.29 | $0.92 | $1.77 | | Diluted earnings per common share | $0.34 | $1.29 | $0.92 | $1.76 | | Weighted average common shares for basic EPS | 63.0 | 63.4 | 63.1 | 63.9 | | Weighted average common shares for diluted EPS | 63.3 | 63.6 | 63.6 | 64.1 | [11. Commitments and Contingencies](index=21&type=section&id=11.%20Commitments%20and%20Contingencies) Discloses the company's contractual obligations, legal claims, and potential liabilities - The Company is involved in various claims and proceedings in the ordinary course of business, including environmental, commercial, and governmental contract claims, for which loss provisions are established when probable and estimable[73](index=73&type=chunk) - The Company is under review by tax authorities in Brazil, Denmark, South Korea, and the U.S. for income and indirect tax matters, with material amounts under controversy, which the Company is appealing[75](index=75&type=chunk)[76](index=76&type=chunk)[77](index=77&type=chunk) [12. Restructuring](index=22&type=section&id=12.%20Restructuring) Details the company's restructuring initiatives, including their purpose and associated costs - The Company implemented a restructuring initiative in **2020**, heightened in **2021**, focusing on streamlining operations and rationalizing resource deployment, particularly in the North American land business[78](index=78&type=chunk) - The restructuring plan was expanded to finalize alignment of processes and platforms within the land segment for greater scalability and integration of new businesses, with an expected completion by Q1 **2022**[78](index=78&type=chunk) - Incremental restructuring charges of **$6.8 million** were incurred during the nine months ended September 30, 2021, primarily for consulting fees and severance costs, with an additional **$4.0 million** to **$6.0 million** expected by Q1 **2022**[79](index=79&type=chunk)[97](index=97&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and results of operations, including an overview of the business, segment performance, and a detailed comparison of financial results for the three and nine months ended September 30, 2021, against the prior year, along with discussions on liquidity, capital resources, and critical accounting estimates [Forward-Looking Statements](index=23&type=section&id=Forward-Looking%20Statements) Highlights statements about future expectations and potential risks that could affect actual results - The report contains forward-looking statements regarding future results, performance, or achievements, qualified by cautionary statements and risk factors disclosed in SEC filings[83](index=83&type=chunk) - Key factors that could cause actual results to differ materially include customer creditworthiness, the impact of the COVID-19 pandemic, adverse industry conditions, sudden changes in fuel prices, compliance with debt covenants, and changes in the political, economic, or regulatory environment[85](index=85&type=chunk)[87](index=87&type=chunk) [Business Overview](index=25&type=section&id=Business%20Overview) Provides a general description of the company's operations, industry, and strategic direction - World Fuel Services Corporation is a global fuel services company in aviation, land, and marine transportation, expanding into energy advisory, management, and fulfillment services, technology solutions, payment management, and sustainability offerings[88](index=88&type=chunk) - The COVID-19 pandemic significantly impacted the global economy and transportation industries, causing a sharp decline in demand and sales, particularly in commercial airlines, with demand remaining below pre-pandemic levels[89](index=89&type=chunk)[90](index=90&type=chunk) [Reportable Segments](index=25&type=section&id=Reportable%20Segments) Describes the performance and key developments within each of the company's operating segments [Aviation Segment](index=25&type=section&id=Aviation%20Segment) Focuses on the performance and market conditions impacting the company's aviation fuel services business - The aviation segment experienced a material volume decline in commercial aviation due to global travel restrictions and decreased demand from the COVID-19 pandemic, though some improvements in demand have begun[94](index=94&type=chunk) - Sales to government customers, particularly NATO in Afghanistan, materially declined in **2020** and **2021** due to troop reductions and final withdrawal in Q3 **2021**, impacting segment profitability[95](index=95&type=chunk) [Land Segment](index=26&type=section&id=Land%20Segment) Examines the performance and strategic initiatives within the company's land fuel distribution business - North American retail operations saw increased volumes in late **2020** and **2021** as economic activity resumed, while the UK home heating oil business experienced decreased demand in **2021**[96](index=96&type=chunk) - The land segment's restructuring initiative in North America was expanded to align processes and platforms for greater scalability and integration of new businesses, with an expected completion by Q1 **2022** and additional charges of **$4.0 million** to **$6.0 million**[97](index=97&type=chunk) [Marine Segment](index=26&type=section&id=Marine%20Segment) Reviews the performance and market dynamics affecting the company's marine fuel services business - The marine segment initially benefited from IMO **2020** regulations and price volatility in early **2020** but experienced a material decline in volume and profitability from late Q1 **2020** through **2021** due to the COVID-19 pandemic, uncertain demand from cruise lines, and competitive market conditions[98](index=98&type=chunk) [Results of Operations](index=26&type=section&id=Results%20of%20Operations) Analyzes the company's financial performance over specific periods, comparing current to prior year results [Three Months Ended September 30, 2021 Compared to Three Months Ended September 30, 2020](index=26&type=section&id=Three%20Months%20Ended%20September%2030,%202021%20Compared%20to%20Three%20Months%20Ended%20September%2030,%202020) Compares the company's financial results for the third quarter of 2021 against the same period in the prior year Revenue (3 Months Ended Sep 30, in millions) | Segment | 2021 | 2020 | Change ($) | Change (%) | | :----------------------------------- | :----- | :----- | :--------- | :--------- | | Aviation | $3,579.7 | $1,596.2 | $1,983.5 | 124% | | Land | $2,670.4 | $1,645.2 | $1,025.2 | 62% | | Marine | $2,100.7 | $1,241.2 | $859.5 | 69% | | **Total Revenue** | **$8,350.9** | **$4,482.7** | **$3,868.1** | **86%** | Gross Profit (3 Months Ended Sep 30, in millions) | Segment | 2021 | 2020 | Change ($) | Change (%) | | :----------------------------------- | :----- | :----- | :--------- | :--------- | | Aviation | $113.0 | $97.6 | $15.4 | 16% | | Land | $62.6 | $84.3 | $(21.7) | -26% | | Marine | $21.9 | $32.0 | $(10.2) | -32% | | **Total Gross Profit** | **$197.5** | **$214.0** | **$(16.5)** | **-8%** | Income from Operations (3 Months Ended Sep 30, in millions) | Segment | 2021 | 2020 | Change ($) | Change (%) | | :----------------------------------- | :----- | :----- | :--------- | :--------- | | Aviation | $57.0 | $29.2 | $27.8 | 95% | | Land | $3.7 | $18.8 | $(15.1) | -80% | | Marine | $3.6 | $8.2 | $(4.6) | -56% | | Corporate overhead - unallocated | $(22.6) | $(17.4) | $(5.2) | 30% | | **Total Income from Operations** | **$41.7** | **$38.8** | **$2.9** | **7%** | - Total operating expenses decreased by **$19.4 million** (**11%**) to **$155.8 million**, primarily due to a **$22.9 million** (**98%**) decrease in the provision for credit losses, partially offset by increased compensation and employee benefits[106](index=106&type=chunk) - Net non-operating expenses were **$9.4 million** in Q3 **2021**, a decrease of **$78.4 million** compared to net non-operating income of **$69.0 million** in Q3 **2020**, primarily due to the gain on the sale of MSTS in the prior year[111](index=111&type=chunk) [Nine Months Ended September 30, 2021 Compared to Nine Months Ended September 30, 2020](index=28&type=section&id=Nine%20Months%20Ended%20September%2030,%202021%20Compared%20to%20Nine%20Months%20Ended%20September%2030,%202020) Compares the company's financial results for the first nine months of 2021 against the same period in the prior year Revenue (9 Months Ended Sep 30, in millions) | Segment | 2021 | 2020 | Change ($) | Change (%) | | :----------------------------------- | :----- | :----- | :--------- | :--------- | | Aviation | $8,480.5 | $6,381.0 | $2,099.6 | 33% | | Land | $7,315.8 | $4,948.8 | $2,367.0 | 48% | | Marine | $5,597.8 | $4,326.4 | $1,271.4 | 29% | | **Total Revenue** | **$21,394.2** | **$15,656.2** | **$5,738.0** | **37%** | Gross Profit (9 Months Ended Sep 30, in millions) | Segment | 2021 | 2020 | Change ($) | Change (%) | | :----------------------------------- | :----- | :----- | :--------- | :--------- | | Aviation | $277.1 | $282.6 | $(5.6) | -2% | | Land | $225.9 | $275.4 | $(49.5) | -18% | | Marine | $70.0 | $128.6 | $(58.6) | -46% | | **Total Gross Profit** | **$573.0** | **$686.6** | **$(113.6)** | **-17%** | Income from Operations (9 Months Ended Sep 30, in millions) | Segment | 2021 | 2020 | Change ($) | Change (%) | | :----------------------------------- | :----- | :----- | :--------- | :--------- | | Aviation | $114.0 | $67.3 | $46.7 | 70% | | Land | $44.5 | $54.1 | $(9.6) | -18% | | Marine | $14.8 | $55.4 | $(40.7) | -73% | | Corporate overhead - unallocated | $(63.1) | $(55.3) | $(7.7) | 14% | | **Total Income from Operations** | **$110.2** | **$121.5** | **$(11.3)** | **-9%** | - Total operating expenses decreased by **$102.4 million** (**18%**) to **$462.7 million**, driven by a **$55.1 million** (**95%**) decrease in the provision for credit losses and a **$15.9 million** (**5%**) decrease in employee compensation costs, partially offset by increased compensation and restructuring expenses[121](index=121&type=chunk) - Net non-operating expense was **$30.7 million** in the first nine months of **2021**, a decrease of **$71.7 million** compared to net non-operating income of **$41.0 million** in the prior year, primarily due to the gain on the sale of MSTS in **2020**[127](index=127&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) Discusses the company's ability to meet its short-term and long-term financial obligations and funding sources - The Company's liquidity is influenced by customer receipts, supplier payments, fuel prices, and financial performance, which impacts availability under its Credit Facility[130](index=130&type=chunk) - Despite the adverse impact of COVID-19, the Company believes its cash, cash equivalents, and Credit Facility funds are sufficient for working capital and capital expenditures for at least the next twelve months[133](index=133&type=chunk) [Cash Flows](index=32&type=section&id=Cash%20Flows) Analyzes the sources and uses of cash from operating, investing, and financing activities Major Categories of Cash Flows (9 Months Ended Sep 30, in millions) | Cash Flow Category | 2021 | 2020 | Change ($) | Change (%) | | :----------------------------------- | :----- | :----- | :--------- | :--------- | | Net cash provided by operating activities | $223.3 | $490.6 | $(267.3) | -54.5% | | Net cash used in investing activities | $(9.8) | $86.9 | $(96.7) | -111.3% | | Net cash used in financing activities | $(70.3) | $(188.8) | $118.5 | 62.8% | - The decrease in operating cash flow was primarily due to a **$182.4 million** decrease in working capital (excluding cash) and a **$38.2 million** decrease in net income, net of noncash adjustments[135](index=135&type=chunk) - Investing cash flow decreased by **$96.7 million**, driven by business acquisition and divestiture activities in **2020** (MSTS sale proceeds of **$268.4M**, UVair acquisition of **$128.6M**) and a decrease in capital expenditures[136](index=136&type=chunk) [Other Liquidity Measures](index=32&type=section&id=Other%20Liquidity%20Measures) Presents additional metrics and resources available to manage the company's liquidity needs Key Liquidity Metrics (in millions) | Metric | Sep 30, 2021 | Dec 31, 2020 | | :----------------------------------- | :----------- | :----------- | | Cash and cash equivalents | $796.0 | $658.8 | | Term Loans outstanding | $490.5 | $503.2 | | Unused portion of Credit Facility | $1,300.0 | $1,300.0 | | Outstanding letters of credit & bank guarantees (other lines) | $383.0 | $328.4 | - The Company was in compliance with all financial covenants under its Credit Facility and Term Loans as of September 30, 2021[142](index=142&type=chunk) - Receivables purchase agreements (RPAs) allowed for the sale of **$6.8 billion** in receivables during the nine months ended September 30, 2021, compared to **$2.6 billion** in **2020**, with associated fees of **$14.6 million** and **$6.8 million**, respectively[144](index=144&type=chunk) [Contractual Obligations and Off-Balance Sheet Arrangements](index=33&type=section&id=Contractual%20Obligations%20and%20Off-Balance%20Sheet%20Arrangements) Details the company's future payment commitments and significant off-balance sheet financial arrangements - Net derivative obligations were **$278.1 million** as of September 30, 2021, principally due within one year[147](index=147&type=chunk) - Fixed purchase commitments under derivative programs amounted to **$87.0 million**, with **$45.7 million** due within one year[147](index=147&type=chunk) - Issued letters of credit and bank guarantees totaled **$386.5 million** as of September 30, 2021, under the Credit Facility and other uncommitted credit lines[148](index=148&type=chunk) [Critical Accounting Estimates](index=33&type=section&id=Critical%20Accounting%20Estimates) Identifies accounting policies requiring significant management judgment and their potential impact on financial results - Significant judgment is involved in impairment assessments of goodwill, long-lived assets, and equity investments, which are based on forecasted financial information and the current/future impact of COVID-19[151](index=151&type=chunk) - As of September 30, 2021, no material impairment of long-lived assets, intangibles, and equity method investments was recognized, and the fair value of land and aviation reporting units was not less than their carrying values[152](index=152&type=chunk) [Recent Accounting Pronouncements](index=34&type=section&id=Recent%20Accounting%20Pronouncements) Summarizes recently adopted or issued accounting standards and their expected impact on financial reporting - Information regarding new accounting pronouncements is included in Note **1**, indicating no material impact on the financial statements upon adoption[154](index=154&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=34&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) States no material changes to the company's exposure to commodity price, interest rate, or foreign currency risk since December 31, 2020 - No material changes to exposures to commodity price, interest rate, or foreign currency risk have occurred since December 31, 2020[155](index=155&type=chunk) [Item 4. Controls and Procedures](index=34&type=section&id=Item%204.%20Controls%20and%20Procedures) Evaluates the effectiveness of disclosure controls and procedures and internal control over financial reporting - Disclosure controls and procedures were evaluated and deemed effective at a reasonable assurance level as of September 30, 2021[157](index=157&type=chunk) - There were no changes in internal control over financial reporting that materially affected, or are reasonably likely to materially affect, internal control over financial reporting during the three months ended September 30, 2021[158](index=158&type=chunk) [Part II. Other Information](index=35&type=section&id=Part%20II.%20Other%20Information) Presents additional disclosures not included in the financial statements, such as legal proceedings and equity sales [Item 1. Legal Proceedings](index=35&type=section&id=Item%201.%20Legal%20Proceedings) Outlines the company's involvement in legal and tax disputes, assessing their potential financial impact - The Company is involved in various income and indirect tax matters under review by domestic and foreign tax authorities, including material disputes in Brazil, Denmark, South Korea, and the U.S[161](index=161&type=chunk) - The Company is also a party to ordinary course business claims (e.g., environmental, commercial contracts), but none are currently expected to have a material adverse effect on its business or financial condition[162](index=162&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=35&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Reports on the company's common stock repurchase activities and remaining authorization Issuer Purchases of Equity Securities (3 Months Ended Sep 30, 2021, in thousands, except price) | Period | Total Shares Purchased | Average Price Paid Per Share | Total Shares Purchased as Part of Publicly Announced Plans | Approximate Dollar Value Remaining Under Plans (in millions) | | :----------------------------------- | :--------------------- | :--------------------------- | :--------------------------------------------------------- | :--------------------------------------------------------- | | 7/1/2021 - 7/31/2021 | 250 | $30.62 | 250 | $238.6 | | 8/1/2021 - 8/31/2021 | 250 | $34.29 | 250 | $230.0 | | 9/1/2021 - 9/30/2021 | 250 | $32.68 | 250 | $221.9 | | **Total** | **750** | **$32.53** | **750** | **$221.9** | - As of September 30, 2021, approximately **$221.9 million** remains available for purchase under the Company's common stock repurchase programs, which have no expiration date[163](index=163&type=chunk) [Item 6. Exhibits](index=36&type=section&id=Item%206.%20Exhibits) Lists all supplementary documents and certifications filed as part of the report - Exhibits include certifications from the Chief Executive Officer and Chief Financial Officer (**31.1**, **31.2**, **32.1**) and XBRL formatted financial statements (**101**, **104**)[165](index=165&type=chunk) [Signatures](index=37&type=section&id=Signatures) Authenticates the report with the formal endorsements of the company's principal executive and financial officers - The report is signed by Michael J. Kasbar, Chairman, President and Chief Executive Officer, and Ira M. Birns, Executive Vice President and Chief Financial Officer, on October 29, 2021[168](index=168&type=chunk) ```

Washington, DC 20549 FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WORLD FUEL SERVICES CORPORATION (Exact name of registrant as specified in its charter) (Mark One) (State or other jurisdiction of incorporation or organization) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Florida 9800 N.W. 41st Street, Miami, Florida 33178 59-2459427 For the quarterly period ended June 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ...

Part I. Financial Information [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section provides the unaudited Condensed Consolidated Financial Statements for Q1 2021 and 2020, encompassing balance sheets, income statements, equity, cash flows, and comprehensive explanatory notes [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to **$4.93 billion** by March 31, 2021, driven by a rise in accounts receivable, with total liabilities also growing due to increased accounts payable Condensed Consolidated Balance Sheet Highlights (in millions) | Account | March 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Total Current Assets** | $3,064.5 | $2,639.3 | | Accounts receivable, net | $1,669.2 | $1,238.4 | | **Total Assets** | **$4,925.4** | **$4,500.3** | | **Total Current Liabilities** | $2,092.2 | $1,684.0 | | Accounts payable | $1,619.3 | $1,214.7 | | **Total Liabilities** | **$2,982.3** | **$2,587.4** | | **Total Equity** | **$1,943.0** | **$1,912.9** | [Condensed Consolidated Statements of Income and Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) Q1 2021 saw a significant year-over-year decline, with revenue decreasing by **25.7%** to **$5.96 billion** and net income attributable to World Fuel dropping by **54.3%** to **$18.9 million** Q1 2021 vs Q1 2020 Performance (in millions, except per share data) | Metric | Q1 2021 | Q1 2020 | | :--- | :--- | :--- | | Revenue | $5,957.9 | $8,015.2 | | Gross Profit | $191.6 | $258.7 | | Income from Operations | $37.6 | $70.8 | | Net Income (attributable to World Fuel) | $18.9 | $41.4 | | Diluted Earnings Per Share | $0.30 | $0.63 | [Condensed Consolidated Statements of Shareholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Shareholders'%20Equity) Total equity increased slightly to **$1.94 billion** by March 31, 2021, driven by net income and other comprehensive income, partially offset by cash dividends - Total equity rose to **$1,943.0 million** at the end of Q1 2021 from **$1,912.9 million** at the end of 2020[12](index=12&type=chunk) - The Board of Directors declared a quarterly cash dividend of **$0.12 per common share**, totaling **$7.5 million**, an increase from **$0.10 per share** (**$6.5 million** total) in the prior-year quarter[13](index=13&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities significantly improved to **$103.4 million** in Q1 2021, while investing activities used less cash and financing activities shifted from providing to using funds Cash Flow Summary (in millions) | Cash Flow Category | Q1 2021 | Q1 2020 | | :--- | :--- | :--- | | Net cash from operating activities | $103.4 | $9.5 | | Net cash from investing activities | $(2.7) | $(149.0) | | Net cash from financing activities | $(20.8) | $507.0 | | **Net increase in cash** | **$76.5** | **$351.0** | [Notes to the Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) These notes detail accounting policies, the COVID-19 impact, credit losses, derivatives, debt, taxes, and segment performance, providing context for the financial statements - The company's business continues to be impacted by the COVID-19 pandemic, particularly in transportation, leading to cost reduction, liquidity, and operating efficiency initiatives[26](index=26&type=chunk) - The allowance for credit losses decreased to **$47.5 million** as of March 31, 2021, from **$57.3 million** at year-end 2020, with write-offs of **$13.8 million** during the quarter[34](index=34&type=chunk)[35](index=35&type=chunk) - The company is involved in several tax disputes, notably in Denmark, South Korea, and Brazil, which could materially adversely affect operating results if resolved unfavorably[57](index=57&type=chunk)[63](index=63&type=chunk)[65](index=65&type=chunk) - Restructuring initiatives, particularly focused on the land business in North America, incurred charges of **$2.1 million** in Q1 2021[69](index=69&type=chunk)[70](index=70&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2021 performance, highlighting the pandemic's impact on aviation and marine segments, cost reductions, liquidity, and the expected decline in NATO sales in Afghanistan - The COVID-19 pandemic continues to significantly impact the global economy and transportation industries, leading to material volume declines in the company's commercial aviation business[81](index=81&type=chunk)[84](index=84&type=chunk) - The company expects a material decline in sales to NATO in Afghanistan following the announcement of a final withdrawal of U.S. and NATO troops, which began on May 1, 2021[85](index=85&type=chunk) Q1 2021 vs Q1 2020 Key Metrics (in millions) | Metric | Q1 2021 | Q1 2020 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $5,957.9 | $8,015.2 | -26% | | Gross Profit | $191.6 | $258.7 | -26% | | Income from Operations | $37.6 | $70.8 | -47% | - Operating expenses decreased by **18%** to **$154.0 million**, driven by ongoing cost-reduction initiatives, the sale of the MSTS business, and a **64%** decrease in the provision for credit losses[98](index=98&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes to the company's exposures to commodity price, interest rate, or foreign currency risk have occurred since December 31, 2020 - The company reports no material changes to its market risk exposures, including commodity price, interest rate, or foreign currency risk, since the end of the previous fiscal year[130](index=130&type=chunk) [Item 4. Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2021, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation as of the end of the reporting period, the CEO and CFO concluded that the company's disclosure controls and procedures were effective[133](index=133&type=chunk) - No material changes to the company's internal control over financial reporting occurred during the first quarter of 2021[134](index=134&type=chunk) Part II. Other Information [Item 1. Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various tax disputes in multiple countries with potentially material amounts, alongside other ordinary course claims not expected to be material - The company is under review by tax authorities in multiple jurisdictions, with potentially material amounts under controversy in Brazil, Denmark, South Korea, and the U.S[137](index=137&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=34&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased a negligible amount of common stock in Q1 2021, primarily for employee tax obligations, with **$246.3 million** remaining available for future repurchases - As of March 31, 2021, approximately **$246.3 million** remains available for future stock repurchases under the company's authorized programs[140](index=140&type=chunk) - No shares were repurchased during the quarter as part of the publicly announced plans or programs[139](index=139&type=chunk) [Item 6. Exhibits](index=35&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q report, including CEO and CFO certifications and financial statements in XBRL format - Exhibits filed with the report include CEO/CFO certifications (31.1, 31.2, 32.1) and XBRL data files (101, 104)[141](index=141&type=chunk) [Signatures](index=36&type=section&id=Signatures) The Form 10-Q report was signed and authorized by CEO Michael J. Kasbar and CFO Ira M. Birns on April 30, 2021, on behalf of World Fuel Services Corporation - The Form 10-Q was signed on April 30, 2021, by CEO Michael J. Kasbar and CFO Ira M. Birns[144](index=144&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to COMMISSION FILE NUMBER 001-09533 WORLD FUEL SERVICES CORPORATION (Exact name of registrant as specified in its charter) (State or other jurisdic ...

Part I. Financial Information [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Presents unaudited consolidated financial statements, including balance sheets, income, equity, and cash flow statements, with notes on accounting policies and key activities [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Total assets decreased to **$4.4 billion** from **$6.0 billion**, liabilities to **$2.5 billion** from **$4.1 billion**, while equity remained stable at **$1.9 billion** Consolidated Balance Sheet Highlights (in millions) | Account | Sep 30, 2020 | Dec 31, 2019 | | :--- | :--- | :--- | | **Total Current Assets** | $2,534.8 | $4,170.1 | | Accounts receivable, net | $1,244.1 | $2,891.9 | | **Total Assets** | **$4,392.3** | **$5,992.4** | | **Total Current Liabilities** | $1,557.0 | $3,162.4 | | Accounts payable | $1,085.8 | $2,602.7 | | **Total Liabilities** | **$2,472.5** | **$4,098.5** | | **Total Equity** | **$1,919.8** | **$1,893.9** | [Consolidated Statements of Income and Comprehensive Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) Q3 2020 revenue declined to **$4.5 billion**, but net income increased to **$82.0 million** due to other income; nine-month revenue also fell, with net income at **$113.1 million** Q3 2020 vs Q3 2019 Performance (in millions, except EPS) | Metric | Q3 2020 | Q3 2019 | | :--- | :--- | :--- | | Revenue | $4,482.7 | $9,322.7 | | Gross Profit | $214.0 | $305.7 | | Income from Operations | $38.8 | $93.6 | | Net Income (attributable to World Fuel) | $82.0 | $48.2 | | Diluted EPS | $1.29 | $0.73 | Nine Months 2020 vs 2019 Performance (in millions, except EPS) | Metric | Nine Months 2020 | Nine Months 2019 | | :--- | :--- | :--- | | Revenue | $15,656.2 | $27,460.9 | | Gross Profit | $686.6 | $825.3 | | Income from Operations | $121.5 | $239.2 | | Net Income (attributable to World Fuel) | $113.1 | $122.4 | | Diluted EPS | $1.76 | $1.84 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow significantly increased to **$490.6 million**, investing activities provided **$86.9 million**, and financing activities used **$188.8 million** for debt and repurchases Cash Flow Summary for Nine Months Ended Sep 30 (in millions) | Cash Flow Category | 2020 | 2019 | | :--- | :--- | :--- | | Net cash provided by operating activities | $490.6 | $168.7 | | Net cash provided by (used in) investing activities | $86.9 | $(55.1) | | Net cash provided by (used in) financing activities | $(188.8) | $(103.1) | | **Net increase in cash and cash equivalents** | **$386.7** | **$6.7** | [Notes to the Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) Details COVID-19 impacts, new accounting standards, the **$303.5 million** sale of MSTS with an **$80.0 million** gain, the UVair acquisition, and an **$18.6 million** restructuring impairment - The COVID-19 pandemic significantly impacted the aviation, marine, and land transportation industries, leading to a sharp decline in demand and sales for the company starting in Q2 2020[28](index=28&type=chunk)[29](index=29&type=chunk) - On September 30, 2020, the company sold its Multi Service payment solutions business (MSTS) for gross cash proceeds of **$303.5 million**, recognizing a pre-tax gain of **$80.0 million**[45](index=45&type=chunk) - A restructuring initiative was implemented due to the pandemic, resulting in **$7.7 million** in severance costs and an **$18.6 million** asset impairment charge from the rationalization of the global office footprint[100](index=100&type=chunk)[101](index=101&type=chunk)[102](index=102&type=chunk) - In Q1 2020, the company acquired the aviation fuel business from Universal Weather and Aviation, Inc. (UVair) for a purchase price of **$159.0 million**, adding **$79.1 million** in goodwill to the aviation segment[47](index=47&type=chunk)[50](index=50&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Discusses the severe COVID-19 impact on all segments, detailing revenue and volume declines, cost reductions, strong operating cash flow, and robust liquidity from the MSTS divestiture [Business Overview and COVID-19 Impact](index=30&type=section&id=Business%20Overview%20and%20COVID-19%20Impact) COVID-19 severely impacted aviation, land, and marine fuel services, causing significant volume declines and prompting cost reductions, a hiring freeze, and restructuring - The aviation segment was severely impacted by global travel restrictions, causing a material volume decline in commercial aviation and a significant reduction in business and general aviation activities[114](index=114&type=chunk) - Sales to NATO in Afghanistan, a material portion of aviation profitability, experienced a decline due to the U.S. troop withdrawal, with further reductions expected[115](index=115&type=chunk) - The marine segment's volume and profitability were negatively impacted by the pandemic, particularly from weakened cruise line demand and lower fuel prices, following a positive start to the year driven by IMO 2020 regulations[117](index=117&type=chunk) - The company implemented significant cost-saving measures, including a hiring freeze, travel restrictions, and a restructuring initiative to streamline operations and rationalize its global office footprint[119](index=119&type=chunk) [Results of Operations](index=33&type=section&id=Results%20of%20Operations) Q3 2020 revenue decreased **52%** to **$4.5 billion**, gross profit fell **30%**, but net income rose to **$82.0 million** due to the MSTS sale gain Q3 2020 vs Q3 2019 Revenue by Segment (in millions) | Segment | Q3 2020 | Q3 2019 | $ Change | | :--- | :--- | :--- | :--- | | Aviation | $1,596.2 | $4,743.0 | $(3,146.8) | | Land | $1,645.2 | $2,555.8 | $(910.6) | | Marine | $1,241.2 | $2,023.9 | $(782.6) | | **Total** | **$4,482.7** | **$9,322.7** | **$(4,840.0)** | Q3 2020 vs Q3 2019 Gross Profit by Segment (in millions) | Segment | Q3 2020 | Q3 2019 | $ Change | | :--- | :--- | :--- | :--- | | Aviation | $97.6 | $156.9 | $(59.3) | | Land | $84.3 | $95.4 | $(11.0) | | Marine | $32.0 | $53.4 | $(21.3) | | **Total** | **$214.0** | **$305.7** | **$(91.7)** | - Total operating expenses for Q3 2020 decreased by **17%** YoY to **$175.2 million**, mainly due to lower compensation and benefits costs, though this was partially offset by higher bad debt expense[131](index=131&type=chunk) - Non-operating income for Q3 2020 was **$69.0 million**, a significant swing from a **$22.8 million** expense in Q3 2019, driven by the **$80.0 million** gain on the sale of the MSTS business[137](index=137&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) Cash and equivalents increased to **$572.7 million**, operating cash flow was **$490.6 million**, with no credit facility borrowings and strong liquidity from the MSTS sale - Cash and cash equivalents increased to **$572.7 million** as of September 30, 2020[165](index=165&type=chunk) - Net cash from operating activities for the first nine months of 2020 was **$490.6 million**, a significant increase from **$168.7 million** in the prior year, driven by favorable working capital changes[162](index=162&type=chunk) - As of September 30, 2020, the company had no outstanding borrowings under its **$1.3 billion** Credit Facility and was in compliance with all financial covenants[167](index=167&type=chunk)[168](index=168&type=chunk) - Investing activities provided **$86.9 million** in cash, primarily from the **$268.4 million** net proceeds from the sale of the MSTS business, partially offset by the **$128.6 million** acquisition of the UVair fuel business[163](index=163&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) A **$300 million** interest rate swap was initiated in March 2020 to hedge variable rate debt, with no other material changes to market risk exposure - In March 2020, the company entered into a **$300 million** interest rate swap maturing in March 2025 to lock in the interest rate on a portion of its variable rate debt at **0.55%**[178](index=178&type=chunk) [Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of September 30, 2020, with no material changes in internal control over financial reporting - Based on an evaluation as of September 30, 2020, the CEO and CFO concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level[181](index=181&type=chunk) Part II. Other Information [Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) The company faces various material tax disputes in multiple countries and other ordinary course claims not expected to materially impact financial condition - The company is under review by tax authorities and involved in various tax-related legal challenges in Brazil, Denmark, South Korea, and the U.S.[185](index=185&type=chunk) [Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) Highlights significant COVID-19 impacts on transportation, including risks of declining sales, increased credit risk, supply chain disruptions, and asset impairments, with uncertain ultimate magnitude - The COVID-19 pandemic has had a significant negative impact on the aviation, land, and marine transportation industries, leading to sharp declines in demand and a decline in the company's sales volume and profitability[188](index=188&type=chunk) - The pandemic increases the risk of customer bankruptcies and credit losses, which could lead to significant increases in bad debt expense, particularly in the aviation segment[188](index=188&type=chunk) - Potential impacts from the pandemic include disruptions in supply chains, delayed customer payments, losses on hedging transactions, asset impairments (including goodwill), and a potential structural shift in global fuel demand[194](index=194&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=46&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No shares were repurchased in Q3 2020, with **$258.9 million** remaining available for future stock repurchases under authorized programs - No shares were repurchased under the company's publicly announced stock repurchase programs during the three months ended September 30, 2020[198](index=198&type=chunk) - As of September 30, 2020, approximately **$258.9 million** was available for purchase under the company's stock repurchase programs[199](index=199&type=chunk) [Exhibits](index=48&type=section&id=Item%206.%20Exhibits) Lists filed exhibits, including CEO and CFO certifications and XBRL-formatted financial statements - Exhibits filed include CEO and CFO certifications pursuant to Rule 13a-14(a) and Section 906 of the Sarbanes-Oxley Act, as well as XBRL data files[200](index=200&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Address of Principal Executive Offices) (Zip Code) Florida 9800 N.W. 41st Street, Miami, Florida 33178 59-2459427 (I.R.S. Employer Identification No.) Registrant's telephone number, including ...