Financial Performance - Consolidated revenue for Q3 2023 was $12.2 billion, a decrease of $3.4 billion, or 22%, compared to Q3 2022, primarily due to lower fuel prices and reduced volumes in the marine segment[101]. - Gross profit for Q3 2023 was $281.4 million, a decrease of $40.9 million, or 13%, compared to Q3 2022, driven by declines in the marine and aviation segments[102]. - Total operating expenses for Q3 2023 were $208.2 million, a decrease of $13.9 million, or 6%, compared to Q3 2022, mainly due to lower compensation and general administrative costs[103]. - Net income attributable to World Kinect for Q3 2023 was $34.9 million, down from $42.5 million in Q3 2022[100]. - Basic earnings per share for Q3 2023 were $0.58, compared to $0.69 in Q3 2022[100]. - For the nine months ended September 30, 2023, consolidated revenue was $35,707.6 million, a decrease of $9,457.8 million or 21% compared to the same period in 2022[117]. - The gross profit for the nine months ended September 30, 2023 was $825.8 million, an increase of $19.1 million or 2% compared to the same period in 2022[118]. Segment Performance - The aviation segment experienced growth in fuel and related services, supported by enhanced logistics capabilities and geographic expansion[91]. - For the three months ended September 30, 2023, the aviation segment revenue was $5,983.5 million, a decrease of $1,278.4 million or 18% compared to the same period in 2022[106]. - The land segment is positioned for continued market share growth, leveraging capabilities from acquisitions like Flyers[92]. - The land segment revenue for the three months ended September 30, 2023 was $3,983.5 million, a decrease of $1,030.4 million or 21% compared to the same period in 2022[109]. - The marine segment's performance is expected to be materially lower in 2023 compared to the exceptional results in 2022 due to lower global oil prices[94]. - The marine segment revenue for the three months ended September 30, 2023 was $2,278.2 million, a decrease of $1,107.2 million or 33% compared to the same period in 2022[113]. - The aviation segment gross profit for the nine months ended September 30, 2023 was $354.4 million, an increase of $107.8 million or 44% compared to the same period in 2022[123]. - Land segment revenue for the nine months ended September 30, 2023, was $11.5 billion, a decrease of $3.3 billion, or 22%, compared to the same period in 2022, primarily due to lower average fuel prices[125]. - Marine segment revenue for the nine months ended September 30, 2023, was $6.8 billion, a decrease of $3.4 billion, or 34%, compared to the same period in 2022[128]. Cost and Pricing - Inflation has significantly increased costs in 2022 and 2023, driven by supply chain disruptions and labor shortages[95]. - The average jet fuel price per gallon sold in the aviation segment decreased by 22% to $2.91 for the three months ended September 30, 2023[106]. - The average fuel price in the land segment decreased by 22% to $2.58 per gallon for the three months ended September 30, 2023[109]. - The average price per metric ton of bunker fuel in the marine segment decreased by 20% to $562.18 for the three months ended September 30, 2023[113]. Cash Flow and Investments - Net cash provided by operating activities for the nine months ended September 30, 2023, was $266.8 million, an increase of $37.5 million compared to the same period in 2022[143]. - Net cash used in investing activities for the nine months ended September 30, 2023, was $77.4 million, a significant decrease from $699.2 million in the same period in 2022[144]. - Net cash used in financing activities for the nine months ended September 30, 2023, was $140.4 million, compared to net cash provided of $115.0 million in the same period in 2022[145]. - The company issued $350.0 million in Convertible Senior Notes due 2028, with an initial conversion price of approximately $28.43 per share[134]. - The company believes that its cash and cash equivalents, along with available funds from its Credit Facility, are sufficient to fund working capital and capital expenditure requirements for at least the next twelve months[133]. Asset Valuation and Risk Assessment - As of September 30, 2023, the company concluded that the carrying value of long-lived assets and equity investments were recoverable, with fair values not less than their respective carrying values[149]. - The company assessed that there have been no material changes to exposures to commodity price, interest rate, or foreign currency risk since December 31, 2022[151]. - Significant judgment is involved in assessing the fair value of contracts related to convertible notes, which may impact future earnings if classified as liabilities[150]. - The assumptions for impairment assessments were based on expected growth rates and profitability from both legacy and newly acquired businesses, considering current market volatility[148]. - The company has not identified any material changes to critical accounting estimates since the 2022 10-K report[147].
World Kinect(WKC) - 2023 Q3 - Quarterly Report