WEX(US:WEX)2021-08-04 19:50Financial Performance - WEX Inc. reported a 24.1% increase in fuel transactions processed, reaching 158.7 million in Q2 2021 compared to 127.9 million in Q2 2020[166]. - Payment processing transactions rose by 26.2%, totaling 130.1 million in Q2 2021, up from 103.1 million in the same quarter last year[166]. - Payment solutions purchase volume surged by 175.7%, amounting to $8.736 billion in Q2 2021, up from $3.168 billion in Q2 2020[169]. - Fleet Solutions revenue increased by $70.0 million (34%) for Q2 2021 and $64.0 million (14%) for the first half of 2021 compared to the same periods in the prior year[176]. - Payment processing revenue rose to $126.5 million in Q2 2021, a 40% increase from $90.1 million in Q2 2020, and $237.0 million for the first half of 2021, up 16% from $203.5 million[175]. - Operating income rose to $109.7 million in Q2 2021, a 144% increase from $44.9 million in Q2 2020, and $199.3 million for the first half of 2021, up 68% from $118.6 million[181]. - Total revenues for Travel and Corporate Solutions rose by $27.3 million (50%) to $81.8 million for Q2 2021 and by $13.6 million (10%) to $152.4 million for the first half of 2021 compared to the same periods in the prior year[189]. - For the six months ended June 30, 2021, adjusted net income attributable to shareholders was $186.2 million, compared to $132.6 million for the same period in 2020, representing a 40.4% increase[228]. Acquisitions and Investments - WEX Inc. completed the acquisition of certain rights from Bell Bank for $200 million, with additional deferred payments of $25 million due in July 2023 and January 2024[160]. - The company acquired the remaining interest in WEX Europe Services for $97 million, streamlining its European Fleet business[162]. - The benefitexpress acquisition was completed for approximately $275 million, enhancing WEX's role in the healthcare ecosystem[163]. - Cash used for investing activities increased by $553.8 million for the six months ended June 30, 2021, mainly due to $558.3 million in payments for acquisitions[233]. Revenue and Expense Trends - The average U.S. fuel price per gallon increased by 46.9%, reaching $3.04 in Q2 2021, compared to $2.07 in Q2 2020[166]. - Finance fee revenue increased by $16.8 million (40%) in Q2 2021 and $13.3 million (14%) for the first half of 2021 compared to the same periods in the prior year[177]. - Sales and marketing expenses increased by $10.6 million (34%) in Q2 2021 and $10.3 million (14%) for the first half of 2021 compared to the same periods in the prior year[187]. - General and administrative expenses surged by $5.2 million (75%) for Q2 2021 and by $29.4 million (205%) for the first half of 2021, mainly due to integration costs related to the acquisition of eNett and Optal[198]. - Depreciation and amortization expenses increased by $3.8 million (36%) for Q2 2021 and $4.3 million (20%) for the first half of 2021, primarily due to the acquisition of contractual rights from Bell Bank[211]. Cash Flow and Financing - Cash flows from operating activities for the six months ended June 30, 2021, decreased by $847.9 million compared to the prior year, primarily due to an increase in accounts receivable balances[232]. - Cash provided by financing activities totaled $398.8 million for the six months ended June 30, 2021, driven by an increase in deposits of $451.3 million[234]. - The Company issued $310.0 million in Convertible Senior Notes due 2027, providing net proceeds of approximately $299.2 million[240]. - WEX Bank had variable-rate borrowings of $2.7 billion under its Amended and Restated Credit Agreement, with a weighted average effective interest rate of 2.2 percent[255]. Credit and Loss Provisions - Provision for credit losses decreased by $6.8 million (37%) in Q2 2021 and $23.0 million (59%) for the first half of 2021 compared to the same periods in the prior year[184]. - Provision for credit losses decreased by $0.9 million (39%) for Q2 2021 and by $13.5 million (87%) for the first half of 2021, reflecting the impact of the sale of WEX Latin America business[195]. Tax and Currency Effects - The effective tax rate was (7.9)% for Q2 2021, a significant decrease from 310.8% in Q2 2020, primarily due to excess tax benefits from stock-based compensation[220]. - Net foreign currency gains of $1.3 million were recorded in Q2 2021, contrasting with losses of $1.4 million for the first half of 2021, reflecting currency fluctuations[218]. Stock and Shareholder Information - The Company has authorization to purchase up to $150 million of its common stock until September 2021, which was entirely unused as of June 30, 2021[263]. - The Company has not declared any dividends on its common stock since its NYSE trading began on February 16, 2005[268].