Corpay, Inc.(US:CPAY)2025-11-10 21:24Financial Performance - For the three months ended September 30, 2025, net revenues were $1,172.5 million, a 13.8% increase from $1,029.2 million in the same period of 2024[115]. - Net income attributable to Corpay for the nine months ended September 30, 2025, was $805.3 million, up 6.3% from $757.8 million in 2024[115]. - Adjusted net income attributable to Corpay for the three months ended September 30, 2025, was $405.2 million, representing a 14.3% increase from $354.5 million in 2024[117]. - Total net revenues for the company reached $1,172.5 million, marking a 14% increase from $1,029.2 million in Q3 2024[127]. - Consolidated revenues for the three months ended September 30, 2025, were $1,172.5 million, reflecting a 13.9% increase compared to the prior period, driven by 11% organic growth[143]. - Total consolidated revenues were $3,280.2 million for the nine months ended September 30, 2025, an increase of 11.6% compared to the prior period[166]. - Operating income for the three months ended September 30, 2025, was $523.1 million, an increase of 11.7% compared to the prior period[150]. - Operating income for the nine months ended September 30, 2025, was $1,429.6 million, reflecting a 10.1% increase from the prior period[173]. - Net income attributable to Corpay increased to $277.9 million for the three months ended September 30, 2025[155]. - Adjusted EBITDA for Q3 2025 was $676.7 million, up from $594.7 million in Q3 2024, indicating a growth of 13.8%[237]. - Adjusted EBITDA margin for Q3 2025 was 57.7%, slightly down from 57.8% in Q3 2024[237]. Revenue Segmentation - Vehicle Payments segment generated $553.2 million in net revenues for the three months ended September 30, 2025, accounting for 47% of total revenues[121]. - Corporate Payments segment revenues increased to $409.7 million, representing 35% of total revenues for the same period[121]. - Vehicle Payments segment reported net revenues of $553.2 million for Q3 2025, a 9% increase from $506.8 million in Q3 2024[127]. - Corporate Payments segment achieved net revenues of $409.7 million, reflecting a significant 27% growth compared to $321.9 million in the same quarter last year[127]. - Corporate Payments revenues reached $1,154.3 million, marking a 31.8% increase, driven by 18% organic revenue growth and a 26% growth in spend volume[182]. - Lodging Payments revenues decreased to $127.0 million, a decline of 5.2% from the prior period, attributed to lower emergency-related activity[160]. - Lodging Payments revenues decreased by 2.9% to $357.0 million, primarily due to a decline in revenue per room night[184]. - Other revenues increased to $82.6 million, a 24.1% rise from the prior period, driven by increased gift card transaction volume[162]. - Other revenues increased by 9.4% to $203.1 million, driven by gift card sales and transaction volume[186]. Geographic Performance - The United States accounted for 49% of total revenues in the three months ended September 30, 2025, with net revenues of $575 million[126]. - Brazil's revenues increased to $183 million, representing 16% of total revenues for the same period[126]. - The company operates primarily in three geographies, generating 79% of revenues from the U.S., Brazil, and the U.K.[118]. Expenses and Taxation - Processing expenses rose to $248.8 million, an increase of 11.2% due to higher transaction volumes and acquisition-related costs[146]. - Selling expenses increased by 24.9% to $117.6 million, primarily due to marketing investments and higher sales commissions[146]. - The provision for income taxes for the three months ended September 30, 2025, was $143.3 million, with an effective tax rate of 34.0%[153]. - Provision for income taxes increased to $336.0 million with an effective tax rate of 29.4% for the nine months ended September 30, 2025, compared to $240.0 million and 24.1% in the prior period[177]. Acquisitions and Investments - The company has completed over 100 acquisitions since 2002, which have significantly contributed to its growth strategy[135]. - In October 2025, the company invested approximately $578 million for about 35% equity in a limited partnership, with an enterprise valuation of approximately $1.9 billion[138]. - The company acquired 100% of Gringo for approximately $153.7 million in February 2025, increasing its controlling interest in Zapay to approximately 86%[139]. - The company announced a cash offer to acquire 100% of Alpha Group International plc in July 2025, a leading provider of B2B cross-border foreign exchange solutions[138]. - The company completed the acquisition of AvidXchange in October 2025, enhancing its accounts payable automation solutions[139]. - In July 2025, the company announced a cash offer to acquire 100% of Alpha Group International plc for approximately £1.8 billion, completed on October 31, 2025[217][219]. - The acquisition of Alpha will be reflected in the Corporate Payments segment starting in Q4 2025[220]. - The company divested a lower growth private label fuel card portfolio for approximately $60 million in July 2025, with the transaction closing in October 2025[221]. - A strategic partnership with Mastercard was expanded in April 2025, involving a $300 million investment for a 2.8% interest in the cross-border business[222]. - In October 2025, the company invested approximately $578 million for a 35% equity stake in AvidXchange, with an enterprise valuation of approximately $1.9 billion[224][225]. Cash Flow and Liquidity - Total liquidity as of September 30, 2025, was approximately $3.4 billion, consisting of $1.4 billion available under the Credit Facility and $2.0 billion in unrestricted cash[189]. - Net cash provided by operating activities was $687.2 million, a decrease from $1,291.9 million in the prior period, primarily due to changes in working capital[194]. - Net cash used in investing activities was $282.9 million, a decrease from $378.2 million in the prior period, attributed to less spending on acquisitions[195]. - The company had $3.0 billion in borrowings outstanding on the Term Loan A and $3.1 billion on the Term Loan B as of September 30, 2025[200]. - The Securitization Facility commitment increased from $1.8 billion to $2.3 billion, extending its maturity to November 3, 2028[205]. Stock and Shareholder Information - The stock repurchase program authorized up to $9.1 billion, with $8.1 billion utilized to repurchase 33,951,728 shares, leaving $1.0 billion available for future repurchases[214][215][216]. - The company reported a total of 71,131 diluted shares for Q3 2025, a slight increase from 70,901 diluted shares in Q3 2024[234]. Management Insights - Corpay's management emphasizes the importance of adjusted net income and EBITDA as key performance indicators for evaluating operational strategies and financial performance[235]. - Organic revenue growth is calculated by adjusting current period revenue growth for macroeconomic changes and acquisitions, providing a clearer view of operational performance[129]. - Adjusted net income attributable to Corpay is calculated to eliminate non-recurring items, providing a clearer view of core operating performance[232].