WEX(US:WEX)2024-07-25 17:53Financial Performance - Total revenues for Q2 2024 were $673.5 million, a 8.4% increase from $621.3 million in Q2 2023[168] - Net income for Q2 2024 was $77.0 million, down from $95.3 million in Q2 2023, representing a decrease of 19.2%[168] - Adjusted net income for Q2 2024 was $164.0 million, compared to $159.3 million in Q2 2023, an increase of 2.2%[168] - Total volume across the company reached $60.1 billion in Q2 2024, up from $55.3 billion in Q2 2023, marking an increase of 6.5%[168] - Operating income for Q2 2024 was $32.5 million, a 10% increase from $29.5 million in Q2 2023, while segment adjusted operating income increased by 20% to $71.1 million[193] - Total segment adjusted operating income for Q2 2024 was $299.9 million, compared to $275.9 million in Q2 2023, reflecting a year-over-year increase of 8.9%[212] - Operating income for the first half of 2024 was $332.6 million, up from $313.7 million in the same period of 2023, indicating a growth of 6.0%[212] Revenue Segments - Mobility segment revenues increased by $19.4 million in Q2 2024, totaling $359.6 million, a 6% increase from $340.2 million in Q2 2023[171] - Total revenues for Corporate Payments increased by $12.2 million for the second quarter of 2024 and $29.9 million for the first half of 2024, primarily due to volume growth in travel and corporate payments[185] - Purchase volume for Corporate Payments reached $25,756.2 million for the second quarter of 2024, an increase of 12% compared to the prior year[184] - Payment processing revenue rose to $24.9 million in Q2 2024, a 6% increase from $23.6 million in Q2 2023, and total revenues for the first half of 2024 reached $371.0 million, up 14% from $324.1 million in the prior year[191] Expenses and Costs - Sales and marketing expenses rose by $10.3 million for the second quarter of 2024 and $15.3 million for the first half of 2024, driven by increased employee costs from the Payzer Acquisition[183] - Processing costs increased by $13.9 million for the first half of 2024, primarily due to higher headcount in technology departments[178] - Processing costs increased by $10.4 million (18%) in Q2 2024 and by $21.2 million (18%) for the first half of 2024, primarily due to higher employee costs from the Ascensus acquisition[195] - General and administrative expenses decreased by $5.6 million and $7.3 million for the three and six months ended June 30, 2024, respectively, compared to the prior year[189] - General and administrative expenses decreased by $3.9 million (25%) in Q2 2024 compared to the prior year, attributed to reduced professional services expenses[197] - Depreciation and amortization increased by $3.6 million and $6.5 million for the three and six months ended June 30, 2024, due to increased capital expenditures and amortization from the Payzer Acquisition[182] - Depreciation and amortization expenses rose by $4.5 million (27%) in Q2 2024, primarily due to the amortization of intangible assets from the Ascensus acquisition[199] Cash Flow and Liquidity - Adjusted free cash flow for Q2 2024 was $(43.4) million, a decrease from $130.9 million in Q2 2023[168] - The company reported an adjusted free cash flow of $(43.4) million for the six months ended June 30, 2024, compared to $130.9 million in the same period of 2023[214] - Cash provided by operating activities decreased by $259.8 million year-over-year for the six months ended June 30, 2024, primarily due to increased customer receivables[223] - Cash used for investing activities decreased by $919.7 million compared to the prior year, primarily due to a reduction in investments in available-for-sale debt securities[224] - Cash provided by financing activities decreased by $1,321.8 million, driven by a decrease in net deposits and BTFP borrowing activity[226] - The Company repurchased approximately 0.8 million shares of common stock for a total of $173.6 million during the six months ended June 30, 2024[227] - Adjusted free cash flow decreased by $174.3 million during the six months ended June 30, 2024, primarily due to the decrease in cash provided by operating activities[228] Debt and Borrowing - The Company had outstanding term loan principal borrowings of $2,283.9 million and borrowings of $756.3 million on the Revolving Credit Facility as of June 30, 2024[218] - The company had remaining borrowing availability of $804.4 million under its Revolving Credit Facility as of June 30, 2024[215] - WEX Bank accessed $760.0 million of temporary capital under the BTFP, pledging investment securities with a par value of $790.6 million as collateral[219] - The Amended and Restated Credit Agreement allows the Company to borrow up to a maximum of $141.6 million from the Federal Reserve Bank Discount Window, with no outstanding borrowings as of June 30, 2024[220] Tax and Regulatory - The effective tax rate increased to 27.5% for Q2 2024, up from 19.1% in Q2 2023, reflecting higher effective tax rates[204] - The company plans to utilize a fixed annual projected long-term non-GAAP tax rate starting in fiscal year 2024 to enhance consistency across reporting periods[208] Foreign Currency and Other - Net foreign currency loss for Q2 2024 was $0.4 million, compared to a loss of $0.2 million in Q2 2023[210]