FleetCor Exits on a High Note

FleetCor Technologies, Inc.’s (FLT - Snapshot Report) fourth quarter adjusted earnings of 82 cents breezed past the Zacks Consensus Estimate by 17.1%. Results were up 46.4% year over year from 56 cents earned in the year-ago quarter.

Including the impact of $10.7 from stock based compensation, amortization of intangible assets, amortization of premium on receivables and amortization of deferred financing costs, FleetCor reported net income of 70 cents per share in the fourth quarter of 2012, up 55.6% year over year

Quarterly Operational update

Operating revenues increased 47.8% year over year to $185.0 million in the fourth quarter. This was driven by solid contribution from both international (up 92.6% year over year) and North America (increasing 18.9% year over year) segment. It surpassed the Zacks Consensus Estimate of $179 billion. Including Merchant commissions, revenue came in at $202.6 million, up 45% year over year

Total expenses in the quarter increased 27.4% year over year to $109.4 million.

The magnitude of increase in revenue more than offset the magnitude of increase in total expense, thereby driving operating income higher over the year-ago numbers. Operating income increased 71.8% year over year to $93.2 million.

Segment wise, operating income at International surged 136.2% year over year to $37.5 million while at North America, it increased 45.2% year over year to $55.7 million in the fourth quarter.

Earnings before interest tax, depreciation and amortization (EBITDA) increased 68.8% year over year to $108.3 million.

Full Year Highlights

Adjusted earnings of $2.99 per share, improved 37.8% year over year. Results exceeded the Zacks Consensus Estimate of $2.74 per share.

Net income for 2012 was $216.2 million or $2.52 per share as against $147.3 million or $1.76 per share in 2011.

Operating revenues for full year 2012, increased 39% year over year to $649.0 million.

Financial Position

FleetCor exited 2012 with cash, cash equivalents and restricted cash of $337.3 million, down 1.1% year over year.

As of Dec 31, 2012, notes payable and other obligations net current portion were $485.2 million, up 74.3% year over year.

Net cash flow from operating activities in 2012 was $135.5 million, deteriorating 51.6% year over year.

FleetCor’s capital expenditures increased 42% year over year to $19.1 million in 2012.


2013 Guidance

FleetCor expects the revenue for 2013 to be in the range of $790-$810 million.

It projects adjusted income to be between $300 million to $310 million or $3.61 per share to $3.69 per share.

Zacks Rank

FleetCor currently carries a Zacks Rank #2 (Buy). Moody’s Corporation (MCO - Analyst Report) and Groupo Financiero Adr (GBOOY) with Zacks Rank #1 (Strong Buy) and Euronet Worldwide Inc. (EEFT - Snapshot Report) with Zacks Rank #2 (Buy) are expected to report their fourth quarter and full year 2012 results shortly.