Corpay, Inc.(CPAY) - 2024 Q2 - Quarterly Report

Financial Performance - For the three months ended June 30, 2024, net revenues were $975.7 million, an increase from$ 948.2 million in the same period of 2023, representing a growth of approximately 2.5%[91]. - Net income attributable to Corpay for the six months ended June 30, 2024, was $481.4 million, compared to$ 454.5 million for the same period in 2023, reflecting a year-over-year increase of about 5.9%[90]. - Adjusted net income per diluted share for the three months ended June 30, 2024, was $4.55, up from$ 4.19 in the same period of 2023, indicating a growth of approximately 8.6%[92]. - For the six months ended June 30, 2024, consolidated revenues reached $1,911.0 million, compared to$ 1,849.5 million in the same period of 2023, marking an increase of about 3.3%[91]. - Consolidated revenues for the six months ended June 30, 2024, were $1,911.0 million, reflecting a 3.3% increase compared to the prior period, driven by organic growth of 6% and acquisitions contributing 1%[124]. - The company reported consolidated revenues of$ 975.7 million for the three months ended June 30, 2024, a 2.9% increase compared to the prior period, driven by 6% organic growth[112]. - Total consolidated net revenues reached $975.7 million, representing a 3% increase from$ 948.2 million year-over-year[101]. - Net income from operations for Q2 2024 was $251.7 million, up from$ 239.7 million in Q2 2023, representing a growth of 6.7%[157]. - The company reported a total EBITDA of $1,000.1 million for the six months ended June 30, 2024, compared to$ 957.2 million for the same period in 2023, an increase of 4.5%[157]. - EBITDA for the three months ended June 30, 2024, was $517.7 million, compared to$ 497.1 million for the same period in 2023, reflecting an increase of 4.3%[157]. - The EBITDA margin for the three months ended June 30, 2024, was 53.1%, compared to 52.4% in the same period of 2023, indicating improved operational efficiency[92]. - Consolidated operating income was $433.3 million, reflecting a 5.0% increase compared to the prior period, with an EBITDA margin expansion of 63 basis points[114]. - Total operating income rose to$ 830.7 million, a 5.4% increase, with an EBITDA margin expansion of 58 basis points over the prior period[126]. Segment Performance - The Vehicle Payments segment generated $510.3 million in net revenues for the three months ended June 30, 2024, accounting for 52% of total revenues, compared to 54% in the same period of 2023[97]. - The Corporate Payments segment saw a revenue increase to$ 288.5 million for the three months ended June 30, 2024, representing 30% of total revenues, up from 26% in the same period of 2023[97]. - Vehicle Payments revenues were $510.3 million, a slight increase of 0.1%, negatively impacted by the disposition of the Russian business, which lowered revenue by approximately$ 32 million[117]. - Corporate Payments revenues increased by 17.3% to $288.5 million, primarily due to 18% organic revenue growth driven by a 19% increase in spend volume[118]. - Lodging Payments segment saw net revenues decline to$ 122.4 million, down 10% from $136.6 million in the prior year[101]. - Lodging Payments revenues decreased by 10.4% to$ 122.4 million, attributed to a 6% decline in room nights compared to the prior year[119]. - Corporate Payments operating income increased by 27.9% to $225.3 million, reflecting strong revenue growth and improved margins[130]. - Other revenues increased by 5.1% to$ 119.1 million, driven by gift card sales and transaction volume increases[132]. Acquisitions and Dispositions - The company completed the sale of its Russia business on August 15, 2023, which had contributed approximately $49.8 million to consolidated income before income taxes for the six months ended June 30, 2023[89]. - The company completed the acquisition of 70% of Zapay for approximately$ 59.5 million, enhancing its Vehicle Payments business in Brazil[106]. - A 100% acquisition of Paymerang for approximately $469 million was finalized, expanding the company's presence in accounts payables automation solutions[106]. - The company signed an agreement to acquire GPS Capital Markets for approximately$ 725 million, expected to close in early 2025[107]. - In January 2023, the company acquired Global Reach for approximately $102.9 million, enhancing its Corporate Payments segment[108]. - The company plans to continue geographic expansion through acquisitions, including PayByPhone Technologies, acquired for approximately$ 301.9 million[108]. - The company acquired Paymerang for approximately $469 million in July 2024, enhancing its presence in various market verticals[147]. - A definitive agreement was signed in June 2024 to acquire GPS Capital Markets, LLC for approximately$ 725 million, expected to close in early 2025[147]. - The company signed a definitive agreement to sell non-core assets in the U.S. Vehicle Payments segment, with an anticipated pre-tax gain on disposal[148]. Cash Flow and Liquidity - As of June 30, 2024, the company had approximately $2.2 billion in total liquidity, consisting of$ 0.9 billion available under the Credit Facility and $1.4 billion in unrestricted cash[133]. - Net cash provided by operating activities was$ 891.1 million for the six months ended June 30, 2024, a decrease of 19% from $1,099.0 million in the same period of 2023[135]. - Net cash used in investing activities was$ 146.6 million for the six months ended June 30, 2024, down from $201.2 million in the comparable prior period, primarily due to reduced acquisition spending[135]. - Capital expenditures increased by 8% to$ 85.3 million in the six months ended June 30, 2024, compared to $78.9 million in the same period of 2023[135]. - The company made borrowings of$ 325.0 million on term loans during the six months ended June 30, 2024, with $3.2 billion outstanding on term loan A and$ 1.8 billion on term loan B as of the same date[136]. Interest and Taxation - Interest expense increased to $94.7 million, up$ 6.2 million from the prior period, primarily due to higher interest rates on increased borrowings[114]. - The provision for income taxes was $82.5 million, with an effective tax rate of 24.7%, down from 26.6% in the prior period[115]. - Interest expense increased by$ 15.5 million to $183.8 million, primarily due to higher interest rates on increased borrowings[126]. - The provision for income taxes for Q2 2024 was$ 82.5 million, slightly down from $86.9 million in Q2 2023[157]. Risks and Forward-Looking Statements - The ongoing military conflicts and geopolitical events are being monitored for their potential impact on the company's operations and market demand[86]. - The company highlighted potential risks including macroeconomic conditions and regulatory changes that could impact future performance[159]. - Forward-looking statements indicate that the company anticipates challenges in executing its strategic plan and managing growth amid various uncertainties[160].