FLEETCOR (FLT) Q1 Earnings & Revenues Beat, 2019 View Up

FLEETCOR Technologies, Inc. (NYSE:FLT) reported strong first-quarter 2019 results wherein both earnings and revenues surpassed the Zacks Consensus Estimate.

Adjusted earnings of $2.67 per share outpaced the consensus estimate by 5 cents and increased 6.8% year over year. Notably, the reported figure exceeded the company guided range of $2.55-$2.65 per share.

Revenues of $621.83 million beat the consensus mark by $16.2 million and increased 6.2% year over year on a reported basis and 11% on a pro-forma and macro adjusted basis.

Organic revenue growth was 11% in the reported quarter, driven by solid double-digit growth across the company’s product categories – fuel, corporate payments, tolls and lodging. Its fuel card business was up 10%, corporate payments increased 18%, toll business grew 15% and lodging business increased 6% organically.

So far this year, shares of FLEETCOR have gained 33.9% compared with 27.2% rise of the industry it belongs to and 16.5% increase of the Zacks S&P 500 composite.

Let's check out the numbers in detail.

Revenues in Detail

Segment-wise, revenues from North America came in at $396.89 million, up 8.9% year over year. Internationally, revenues of $224.92 million increased 1.7% year over year.

Product category-wise, fuel revenues of $283 million increased 7% year over year on a reported basis and 10% on a pro-forma and macro adjusted basis.

Corporate Payments revenues of $110.3 million increased 16% year over year on a reported basis and 18% on a pro-forma and macro adjusted basis.

Tolls revenues of $88.9 million decreased 1% year over year on a reported basis but improved 15% on a pro-forma and macro adjusted basis.

Lodging revenues of $41.8 million increased 6% year over year on a reported basis as well as on a pro-forma and macro adjusted basis.

Gift revenues of $48.4 million decreased marginally year over year on a reported basis and 3% on a pro-forma and macro adjusted basis.

Other revenues of $49.4 million increased 4% year over year on a reported basis and 9% on a pro-forma and macro adjusted basis.

Operating Results

Operating income increased 9.3% from the prior-year quarter to $284.18 million. Operating income margin rose to 45.7% from 44.4% in the prior-year quarter.

Balance Sheet & Cash Flow

FLEETCOR exited first-quarter 2019 with cash, cash equivalents and restricted cash of approximately $1.37 billion compared with $1.36 billion at the end of the prior quarter.

The company generated $297.49 million of net cash from operating activities. Capital expenditures totaled $14.5 million.

In the reported quarter, FLEETCOR repurchased shares worth $3.32 million.

Guidance

Second-Quarter 2019

For second-quarter 2019, the company expects adjusted earnings to be in the range of $2.74-$2.84 per share. The current Zacks Consensus Estimate of $2.78 per share lies within the guided range.

The second-quarter guidance includes the dilutive impact of the Nvoicepay acquisition and higher share count.

Full-Year 2019

For 2019, FLEETCOR raised its revenue and adjusted earnings guidance while reaffirming the same for organic revenue growth, adjusted tax rate and interest expense.

Total revenues are now anticipated in the range of $2.60-$2.66 billion compared with the previously guided range of $2.57-$2.63 billion. The current Zacks Consensus Estimate of $2.60 billion is line with the lower end of the currently guided range.

Adjusted earnings are now expected the range of $11.47-$11.77 per share compared with the prior guided range of $11.40-$11.70 per share. The current Zacks Consensus Estimate of $11.62 per share lies within the currently guided range.

The company continues to expect organic revenues to register 9-11% growth. Adjusted tax rate is anticipated between 23% and 24%. Interest expense is estimated around $160 million.

Zacks Rank & Stocks to Consider

FLEETCOR currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Investors interested in the broader Zacks Business Services sector are awaiting reports of key players like MAXIMUS (NYSE:MMS) , Equifax (NYSE:EFX) and Booz Allen Hamilton (NYSE:BAH) . While MAXIMUS is slated to report second-quarter fiscal 2019 on May 9, Equifax is scheduled to release first-quarter 2019 results on May 10. Booz Allen Hamilton is set to report fourth-quarter fiscal 2019 results on May 28.

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