FLEETCOR Technologies, Inc. (FLT): history, ownership, mission, how it works & makes money

A Brief History of Fleetcor Technologies, Inc.

Company Overview

Fleetcor Technologies, Inc. (FLT) operates in the business of payment processing, specializing in providing services for commercial payment solutions across various sectors. As of 2024, the company has significantly expanded its operations, which include Vehicle Payments, Corporate Payments, and Lodging Payments.

Financial Performance

For the three months ended March 31, 2024, Fleetcor reported net revenues of $935.3 million, up from $901.3 million during the same period in 2023, marking a 3.8% increase. The breakdown of revenues by segment is as follows:

Net Income and Earnings Per Share

Fleetcor's net income attributable to shareholders for Q1 2024 was $229.8 million, compared to $214.8 million in Q1 2023, representing a 7.0% increase. The basic and diluted earnings per share were $3.20 and $3.12, respectively, compared to $2.92 and $2.88 for the previous year.

Operational Highlights

The company has made strategic acquisitions to bolster its service offerings. In March 2024, Fleetcor acquired a 70% stake in Zapay, a Brazil-based digital consumer mobility solution, for approximately $56.3 million. This acquisition is expected to enhance Fleetcor's Vehicle Payments segment in Brazil.

Debt Structure

As of March 31, 2024, Fleetcor's total debt amounted to $6.76 billion, which is a slight increase from $6.72 billion at the end of 2023. The breakdown of the debt is as follows:

Cash Flow Analysis

For the first quarter of 2024, Fleetcor reported net cash provided by operating activities of $350.2 million, a significant decrease from $877.7 million in Q1 2023. The company’s cash flows from investing activities were $102.3 million, while financing activities resulted in a cash outflow of $158.6 million.

Stock Repurchase Program

During the first quarter of 2024, Fleetcor repurchased 1,096,762 shares at an aggregate price of $321.3 million. Since the initiation of its stock repurchase program, the company has repurchased a total of 29,975,624 shares for $6.9 billion, with $1.2 billion remaining for future repurchases.

Future Outlook

Fleetcor continues to focus on expanding its market presence through strategic acquisitions and enhancing its service offerings. The company is well-positioned to capitalize on growth opportunities in the commercial payment solutions sector.

A Who Owns FLEETCOR Technologies, Inc. (FLT)

Major Shareholders

As of 2024, the ownership structure of FLEETCOR Technologies, Inc. (FLT) is characterized by a mix of institutional and individual investors. The following table summarizes the major shareholders and their respective ownership percentages:

Insider Ownership

Insider ownership is an essential aspect of FLEETCOR’s governance structure. As of March 31, 2024, insiders hold approximately 2.1% of the total shares outstanding. This percentage is indicative of the alignment between management interests and shareholder interests.

Institutional Ownership Trends

Institutional ownership has seen a gradual increase over the past few years. The top five institutional investors collectively own approximately 46.2% of the company. Below is a breakdown of the institutional ownership trends:

Stock Performance and Market Capitalization

As of March 31, 2024, FLEETCOR’s market capitalization stands at approximately $20.3 billion, reflecting a stock price of around $280 per share. This represents a year-to-date increase of 15% in stock performance, driven by strong revenue growth and strategic acquisitions.

Recent Acquisitions and Their Impact on Ownership

FLEETCOR has been active in pursuing acquisitions to enhance its market position. In March 2024, the company acquired a 70% stake in Zapay for approximately $56.3 million. This acquisition is expected to further increase institutional interest and may impact future ownership structures as the company continues to expand its portfolio.

Stock Buyback Program

FLEETCOR has an active stock buyback program, which was enhanced to $8.1 billion in January 2024. As of March 31, 2024, the company repurchased a total of 29.9 million shares, indicating a commitment to returning value to shareholders.

FLEETCOR Technologies, Inc. (FLT) Mission Statement

Mission Overview

The mission of FLEETCOR Technologies, Inc. is to simplify and automate the way businesses manage and pay their expenses, offering innovative solutions that enhance operational efficiency and financial management.

Core Values

• Innovation: Continuously developing new technologies to improve payment solutions.
• Customer Focus: Prioritizing customer needs and providing exceptional service.
• Integrity: Upholding high ethical standards in all business dealings.
• Collaboration: Fostering teamwork to achieve shared goals.

Financial Performance Metrics

As of March 31, 2024, FLEETCOR reported the following financial performance metrics:

Revenue Segmentation

The following table illustrates the revenue distribution across FLEETCOR's main business segments for Q1 2024:

Geographic Revenue Distribution

FLEETCOR's revenues by geography for the three months ended March 31, 2024, are as follows:

Recent Developments

In 2024, FLEETCOR acquired a 70% stake in Zapay for approximately $56.3 million, enhancing its Vehicle Payments segment in Brazil. This acquisition aligns with FLEETCOR's mission to expand its service offerings and geographic reach.

Conclusion on Mission Alignment

The mission of FLEETCOR Technologies, Inc. is reflected in its strategic initiatives and financial performance, demonstrating a commitment to innovation, customer satisfaction, and operational excellence.

How FLEETCOR Technologies, Inc. (FLT) Works

Business Overview

FLEETCOR Technologies, Inc. operates primarily in the business payments industry, providing various payment solutions that simplify, automate, and secure the management of expenses for businesses, merchants, and consumers. The company generates revenue from multiple segments including Vehicle Payments, Corporate Payments, Lodging Payments, and other services like Gift and Payroll Cards.

Financial Performance

For the three months ended March 31, 2024, FLEETCOR reported consolidated revenues of $935.3 million, marking a 3.8% increase compared to $901.3 million in the same period of 2023. The breakdown of revenues by segment is shown in the table below:

Segment Analysis

Vehicle Payments

Vehicle Payments revenues were $494.1 million, a slight decrease of 0.3% from the previous year. The decline was attributed to the sale of the Russia business in August 2023, which reduced revenue by approximately $31 million. Organic growth was observed at 4%, aided by new sales in international markets and acquisitions contributing $11 million.

Corporate Payments

Corporate Payments segment generated revenues of $265.4 million, reflecting a significant increase of 17.3% year-over-year. This growth was driven by strong new sales in accounts payable and cross-border solutions, alongside a slight uptick in spend volume.

Lodging Payments

In the Lodging Payments segment, revenues reached $111.3 million, down 9.0% from the prior year. The decrease is largely due to high weather-related passenger volumes and insurance claims in 2023, which provided a tough comparison.

Other Revenues

Other revenues increased by 12.5% to $64.5 million, primarily due to organic growth driven by the timing of gift card sales and increased transaction volume.

Income and Expenses

Net income attributable to FLEETCOR for Q1 2024 was $229.8 million, up from $214.8 million in Q1 2023, reflecting a 7.0% increase. The net income per diluted share was $3.12, compared to $2.88 in the prior year.

Operational Metrics

The company's operating income for the three months ended March 31, 2024, was $397.3 million, compared to $375.2 million in the prior year, resulting in a 5.9% increase. The operating income by segment is detailed below:

Liquidity and Capital Resources

As of March 31, 2024, FLEETCOR had approximately $2.8 billion in total liquidity, comprising $1.5 billion available under its credit facility and $1.3 billion in unrestricted cash. The company's principal liquidity requirements include servicing debt, making acquisitions, and meeting working capital needs.

Debt and Financing

FLEETCOR's debt structure includes a $7.0 billion Credit Agreement with various financial institutions, encompassing a revolving credit facility and term loans. As of March 31, 2024, the company had $3.2 billion in borrowings outstanding on term loan A and $1.8 billion on term loan B.

How FLEETCOR Technologies, Inc. (FLT) Makes Money

Revenue Segments

FLEETCOR Technologies operates primarily through four segments: Vehicle Payments, Corporate Payments, Lodging Payments, and Other. The breakdown of revenues by segment for the three months ended March 31, 2024, is as follows:

Vehicle Payments

In the Vehicle Payments segment, revenues were $494.1 million for Q1 2024, a slight decrease of 0.3% compared to Q1 2023. This decline was largely attributed to the divestiture of the Russia business, which accounted for a revenue loss of approximately $31 million. Excluding this impact, organic growth was approximately 4%, driven by new sales in international markets and contributions from recent acquisitions.

Operating income for this segment was $225.7 million, reflecting a 1.0% increase year-over-year. The improvement was aided by a decrease in bad debt expenses by about $15 million as the company shifted focus to higher credit quality clients.

Corporate Payments

The Corporate Payments segment reported revenues of $265.4 million, marking a robust 17.3% increase from the previous year. This growth was primarily fueled by strong new sales in accounts payable (AP) and cross-border solutions, alongside a slight rise in spend volume. Operating income for this segment rose to $104.7 million, an increase of 30.2% from Q1 2023.

Lodging Payments

Lodging Payments generated $111.3 million in revenue, down 9.0% from the prior year. The decline was influenced by softer demand, particularly from smaller field service companies, and the previous year's high weather-driven passenger volume and insurance claims. Operating income for this segment decreased to $47.3 million, down 13.4% from the previous year.

Other Segment

Revenues from the Other segment, which includes Gift and Payroll Card businesses, reached $64.5 million, reflecting a 12.5% increase compared to the prior year, driven by higher transaction volumes. Operating income for this segment increased by 17% to $19.7 million.

Geographical Revenue Distribution

FLEETCOR's revenues are also distributed geographically, with the following breakdown for Q1 2024:

Key Financial Metrics

For the three months ended March 31, 2024, FLEETCOR reported the following key financial metrics:

Consolidated Operating Income

FLEETCOR's consolidated operating income for Q1 2024 was $397.3 million, a 5.9% increase compared to the prior period. This growth is attributed to the strong performance across its segments, with notable increases in Corporate Payments and Other segments.

Conclusion on Revenue Streams

FLEETCOR's diverse revenue streams across multiple segments and geographies position it well for sustained growth. The company continues to focus on organic growth through new sales initiatives and strategic acquisitions, while also managing its operational expenses effectively to enhance profitability.