Improved foreign-exchange rates and higher fuel prices helped improve the first quarter performance at fleet card provider Fleetcor Technologies Inc.
“It was a generally positive economic environment,” Ronald Clarke, the Norcross, Ga.-based company’s chairman, president and CEO, told analysts during a May 12 conference call to discuss earnings. “Our U.S. Direct, or what we call our own brand business, grew 13%, our hotel card business grew 20%, and our Russia business grew over 70% in the quarter, so obviously these three contributed to a pretty good start.”
But market margins were “very low” as well, “which negatively impacted a few of our spread-based businesses,” he added.
Major accomplishments during the quarter included migrating a large portion of the company’s U.S. major oil business to extended network-branded cards, which bolster revenue by providing more places to conduct transactions, and making progress toward implementing Fleetcor’s contract with Royal Dutch Shell’s European unit, Clarke said.
In that deal, Shell’s fuel card system is migrating to a processing platform in partnership with Logica PLC, a United Kingdom-based technology and business-service company. The project will expand across 35 countries in Europe and Asia, according to Fleetcor.
Revenues for the quarter totaled $111 million, up 6.5% from $104.2 million during the same period last year. Net income was up 18.3%, to$32.3 million from $27.3 million.
Regionally, North American customers used the company’s cards to initiate 36.2 million transactions. At $1.98 per transaction, net revenues in the region totaled $71.6 million. That compares with $68.6 million earned from 34.9 million transactions that earned an average of $1.96 each a year earlier, Fleetcor noted in its earnings release.
The company’s international segment earned $39.4 million on 11.3 million transactions that generated $3.49 each, which compared with $35.3 million earned from 10.7 million transactions earning $3.29 each in last year’s first quarter, Fleetcor said.
In early trading May 13, shares of Fleetcor stock were selling at $34.86, up 3.7% from the previous day’s $33.61 closing price.
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