Corpay, previously Fleetcor Technologies, has reduced its full-year earnings forecast for 2024, citing high interest rates and unfavorable foreign exchange rates, according to CEO Ron Clarke.
“Both of these macro factors unfortunately will depress our current rest of year,” Clarke said during a call with analysts Wednesday after the market closed. “Additionally, we’re expecting our lodging clients’ softness to hang around longer, thereby reducing our full-year lodging revenue forecast.”
Corpay posted a first-quarter year-over-year (y/y) revenue increase of 4% to $935.25 million and quarterly earnings per share of $4.10, an 8% y/y increase. The company missed Wall Street’s revenue estimates of $936.3 million but beat analysts’ estimated EPS of $4.08.
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Corpay (NYSE: CPAY) is an Atlanta-based provider of fuel card and payment products for commercial transportation and other industries.
The company reduced full-year 2024 revenue guidance to $4 billion, down $80 million from the previous guidance. Corpay also lowered its full-year EPS guidance to $19, down from previous guidance of $19.40.
“Despite the bit softer full-year outlook, we’re still expecting a very strong Q4 exit with organic revenue there well above 10% and cash EPS above $5,” Clarke said.
Revenue from the company’s fuel card program decreased 0.3% y/y to $494 million, while fuel revenue per transaction decreased 26% y/y to $2.47. On the company’s earnings call, management acknowledged mixed quarterly results in trucking markets domestically and abroad.
The U.S. is Corpay’s largest market, with revenue totaling $505 million in the first quarter, a 2% y/y decrease. Revenue in Brazil increased 21% y/y to $148 million, and revenue was up 12% y/y in the United Kingdom to $121 million.
“In vehicle payments, organic revenue grew 4% during the quarter, with the increase driven by Brazil and international fleets,” CFO Tom Panther said.
In 2022, Corpay changed its North American fuel fleet sales strategy by pivoting from small micro accounts to bigger-company prospects. Company officials said the change in focus has produced slower results than anticipated.
“For sure we’re dealing with a couple of problem children here in Q1; our North America vehicle business as you’ll recall is making the pivot away from low-quality micro accounts to small and medium-sized business accounts,” Clarke said. “We are increasing the sales ramp there with incremental digital and a new kind of upmarket field sales channel to drive the pivot, but it’s taking a bit longer than expected. But I do want to say where we are for sure making progress.”
CorpayQ1/24Q1/23Y/Y % ChangeTotal revenue$953.3M$901.3M4%Vehicle payments revenue$494.1M$495.5M(0.3%)Net revenue per fuel transaction$2.47$3.35(26%)Number of fleet transactions107.9122.8(12%)Adjusted earnings per share$4.10$3.8014%Corpay’s key first-quarter performance indicators.
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