IMGCAP(1)]
Wright Express Corp., a payment-processing company for commercial and government vehicle fleets, today announced fourth quarter net income of $65.2 million, up dramatically from $4.6 million for the same quarter a year earlier. The results include an unrealized pretax gain of $86.2 million on fuel-price derivatives the company uses to offset risks associated with fuel-price variability. During the same quarter a year earlier, Wright Express reported an unrealized pretax loss of $22.8 million on derivatives. Total revenues were $80.9 million, down 10.8% from $90.7 million. Payment processing generated $56.2 million in revenue, down 18.9% from $69.3 million. Total operating expenses rose 21.1%, to $61.9 million compared with $51.1 million. The provision for credit losses during the quarter rose 85.9%, to $14.5 million from $7.8 million. South Portland, Maine-based Wright Express served 4.6 million vehicles during the quarter, up 2.2% from 4.5 million a year earlier. Wright processed 66.9 million fuel transactions, up 6% from 63.1 million. Cardholders averaged 20.3 gallons of fuel per transaction Wright processed, down 0.9% compared with 20.5 gallons a year earlier. The average fuel price per transaction was $2.59 compared with $3.06 a year earlier. On MasterCard-branded Wright Express cards, purchase volume was $586 million, up 21.1% from $484 million for the same quarter in 2007. The net interchange rate on those transactions was 0.99%, down 11 basis points from 1.10%. Revenue from processing those MasterCard-branded payments was $5.83 million, up 9.6% from $5.32 million a year earlier. In a teleconference today with analysts, Michael E. Dubyak, chairman, president and chief executive officer, said that the fuel payment-processing industry faces challenges caused by rising credit losses, lower fuel prices and overall fueling-volume declines.
