Corpay, Inc.(CPAY) - 2024 Q1 - Quarterly Report

Financial Performance - For the three months ended March 31, 2024, net revenues were $935.3 million, an increase of 3.5% from$ 901.3 million in the same period of 2023[97]. - Net income attributable to Corpay for Q1 2024 was $229.8 million, up 7% from$ 214.8 million in Q1 2023[97]. - Adjusted net income attributable to Corpay for Q1 2024 was $301.3 million, compared to$ 283.1 million in Q1 2023, reflecting a 6.3% increase[98]. - EBITDA for Q1 2024 was $482.4 million, an increase from$ 460.1 million in Q1 2023, resulting in an EBITDA margin of 51.6% compared to 51.0% in the prior year[98]. - Total consolidated net revenues increased by 4% to $935.3 million from$ 901.3 million[106]. - Net income attributable to Corpay increased by 7.0% to $229.8 million in Q1 2024[123]. - Revenues for Q1 2024 reached$ 935.3 million, compared to $901.3 million in Q1 2023, marking a year-over-year increase of 3.6%[154]. - EBITDA for Q1 2024 was$ 482.4 million, up from $460.1 million in Q1 2023, reflecting a growth of 4.9%[154]. - EBITDA margin improved to 51.6% in Q1 2024, compared to 51.0% in Q1 2023[154]. Revenue Segmentation - The Vehicle Payments segment generated$ 494.1 million in net revenues for Q1 2024, accounting for 53% of total revenues, slightly down from $495.5 million (55%) in Q1 2023[102]. - Corporate Payments segment revenues increased to$ 265.4 million in Q1 2024, representing 28% of total revenues, up from $226.2 million (25%) in Q1 2023[102]. - Revenues from the Lodging Payments segment decreased to$ 111.3 million in Q1 2024, down from $122.3 million in Q1 2023, representing 12% of total revenues[102]. - Vehicle Payments revenues decreased by 0.3% to$ 494.1 million, primarily due to the disposition of the Russian business, which reduced revenue by approximately $31 million[125]. - Corporate Payments revenues increased by 17.3% to$ 265.4 million, with organic growth of 17% attributed to strong new sales in AP and cross-border solutions[126]. - Lodging Payments revenues fell by 9.0% to $111.3 million, impacted by high weather-driven passenger volume in 2023 and a tough macro environment[127]. Acquisitions and Growth Strategy - The company acquired 70% of Zapay for approximately$ 56.3 million, enhancing its Vehicle Payments business in Brazil[113]. - A definitive agreement was signed to acquire 100% of Paymerang for approximately $475 million, expected to close in Q2 2024[113]. - The company has completed over 95 acquisitions since 2002, indicating a strong growth strategy through acquisitions[112]. - The company completed several acquisitions in 2023, including Global Reach for$ 102.9 million and PayByPhone for $301.6 million, aimed at expanding geographic reach and product offerings[115]. Cash Flow and Liquidity - Net cash provided by operating activities decreased to$ 350.2 million in Q1 2024 from $877.7 million in Q1 2023, primarily due to an increase in restricted cash[132]. - Total liquidity as of March 31, 2024, was approximately$ 2.8 billion, consisting of $1.5 billion available under the Credit Facility and$ 1.3 billion in unrestricted cash[129]. - The company had $3.2 billion in borrowings outstanding on the term loan A and$ 1.8 billion on the term loan B as of March 31, 2024[133]. - Net cash used in financing activities decreased to $158.6 million in Q1 2024 from$ 217.7 million in Q1 2023, primarily due to net borrowings on credit facilities[132]. Expenses and Financial Management - Processing expenses were $207.4 million, a 1.2% increase, influenced by higher transaction volumes and acquisition-related costs[121]. - Selling expenses surged by 15.4% to$ 94.2 million, driven by increased commissions from higher sales volume[121]. - Interest expense increased to $89.1 million in Q1 2024, up from$ 79.8 million in Q1 2023, representing a rise of 14.6%[154]. - Provision for income taxes decreased to $75.5 million in Q1 2024 from$ 80.0 million in Q1 2023, indicating a reduction of 6.3%[154]. Strategic Focus and Market Conditions - Corpay's vision emphasizes that every payment is digital, every purchase is controlled, and every related decision is informed, aiming to reduce unauthorized spending and fraud[91]. - The company is focused on executing its strategic plan and managing growth while navigating macroeconomic conditions and regulatory changes[156]. - Future performance is subject to various risks, including changes in consumer preferences and international operational risks[156]. - The company emphasizes the importance of developing new technology, products, and services to enhance its market position[157]. Market Impact and Risks - Fuel price volatility impacted approximately 8% of revenues in Q1 2024, down from 12% in Q1 2023[111]. - The Company experienced a negative impact of approximately $4 million from fuel prices and$ 6 million from fuel price spreads during the reporting period[150]. - The impact of foreign exchange rates contributed positively with an estimated $14 million during the same period[150]. - No material changes to market risk were reported as of March 31, 2024, compared to disclosures in the Annual Report for the year ended December 31, 2023[158].