Printer Friendly Version View printer-friendly version
<< Back
WEX Inc. Reports Second Quarter 2017 Financial Results

Total Revenue for the Quarter Increased 30%

SOUTH PORTLAND, Maine--(BUSINESS WIRE)--Jul. 27, 2017-- WEX Inc. (NYSE:WEX), a leading provider of corporate payment solutions, today reported financial results for the three months ended June 30, 2017.

Second Quarter 2017 Financial Results

Total revenue for the second quarter of 2017 increased 30% to $303.9 million from $233.9 million for the second quarter of 2016. During the quarter, higher fuel prices positively impacted revenue by $8.1 million when compared to the prior year period.

Net earnings attributable to shareholders on a GAAP basis increased $4.5 million to $17.1 million, or $0.40 per diluted share, compared with $12.6 million, or $0.32 per diluted share, for the second quarter of 2016. The Company's adjusted net income attributable to shareholders, which is a non-GAAP measure, was $54.2 million for the second quarter of 2017, or $1.26 per diluted share, up 15% from $1.10 per diluted share for the same period last year. See Exhibit 1 for a full explanation and reconciliation of adjusted net income attributable to shareholders and adjusted net income attributable to shareholders per diluted share to the comparable GAAP measures.

“Today we posted a very strong quarter, highlighted by a top line beat and bottom line results at the top of our guidance range,” said Melissa Smith, WEX’s president and chief executive officer. “All three segments contributed to our impressive performance this quarter and delivered better than anticipated organic revenue growth.”

Smith continued, “I am pleased that our products and service offerings are resonating with customers and new business prospects in the various markets we serve. We look forward to a successful remainder of 2017, as we continue the momentum generated in the first half of the year.”

Second Quarter 2017 Performance Metrics

  • Average number of vehicles serviced worldwide was approximately 10.9 million, an increase of 13% from the second quarter of 2016.
  • Total fuel transactions processed increased 24% from the second quarter 2016 to 130.0 million. Payment processing transactions increased 15% to 108.1 million.
  • Average expenditure per payment processing transaction was $68.43, which represents an increase of 23% from the second quarter of 2016.
  • U.S. retail fuel price increased 5% to $2.41 per gallon from $2.29 per gallon in the second quarter of 2016.
  • Total Travel and Corporate Solutions card purchase volume grew 37% to $7.7 billion, from $5.6 billion in the second quarter of 2016.
  • Total Health and Employee Benefits Solutions purchase volume increased 7% to $1.1 billion in second quarter of 2017.

Financial Guidance and Assumptions

The Company provides revenue guidance on a GAAP basis and earnings guidance on a non-GAAP basis, due to the uncertainty and indeterminate amount of certain elements that are included in reported GAAP earnings.

  • For the full year 2017, the Company expects revenue in the range of $1.20 billion to $1.22 billion and adjusted net income in the range of $221 million to $230 million, or $5.15 to $5.35 per diluted share.
  • For the third quarter of 2017, WEX expects revenue in the range of $302 million to $312 million and adjusted net income in the range of $58 million to $61 million, or $1.35 to $1.42 per diluted share.

“I am encouraged by our disciplined execution this quarter, which resulted in strong organic growth, repricing of our debt and the EFS integration progressing ahead of schedule. The organization is well-positioned for continued growth driven by the strength of our underlying business, coupled with our ability to leverage our investments and create further synergies,” said Roberto Simon, WEX's chief financial officer.

Third quarter 2017 guidance is based on an assumed average U.S. retail fuel price of $2.33 per gallon. Full-year 2017 guidance is based on an assumed average U.S. retail fuel price of $2.36 per gallon. The fuel prices referenced above are based on the applicable NYMEX futures price. Our guidance assumes approximately 43 million shares outstanding for the third quarter and full year 2017.

The Company's guidance also assumes that third quarter 2017 fleet credit loss will range between 18 and 23 basis points, and full year 2017 fleet credit loss will range between 18 and 22 basis points.

The Company's adjusted net income guidance, which is a non-GAAP measure, excludes unrealized gains and losses on derivative instruments, net foreign currency remeasurement gains and losses, acquisition-related ticking fees, acquisition-related intangible amortization, other acquisition and divestiture related items, stock-based compensation, restructuring and other costs, an impairment charge, debt issuance cost amortization, similar adjustments attributed to our non-controlling interest and certain tax related items. We are unable to reconcile our adjusted net income guidance to the comparable GAAP measure without unreasonable effort because of the difficulty in predicting the amounts to be adjusted, including but not limited to foreign currency exchange rates, unrealized gains and losses on derivative instruments, and acquisition and divestiture related items, which may have a significant impact on our financial results.

Additional Information

Management uses the non-GAAP measures presented within this news release to evaluate the Company's performance on a comparable basis. Management believes that investors may find these measures useful for the same purposes, but cautions that they should not be considered a substitute for, or superior to, disclosure in accordance with GAAP.

WEX historically used fuel-price derivative instruments to mitigate financial risks associated with the variability in fuel prices in North America. Starting with the second quarter of 2016, there were no longer any fuel price related derivatives outstanding.

To provide investors with additional insight into its operational performance, WEX has included in this news release in Exhibit 2, a table illustrating the impact of foreign currency translations and fuel prices for each of our operating segments for the three and six months ended June 30, 2017 and 2016, and in Exhibit 3, a table of selected non-financial metrics for the five quarters ended June 30, 2017. The Company is also providing selected segment revenue information for the three and six months ended June 30, 2017 and 2016 in Exhibit 4.

Conference Call Details

In conjunction with this announcement, WEX will host a conference call today, July 27, 2017, at 10:00 a.m. (ET). As previously announced, the conference call will be webcast live on the Internet, and can be accessed at the Investor Relations section of the WEX website, http://www.wexinc.com. The live conference call also can be accessed by dialing (866) 334-7066 or (973) 935-8463. The Conference ID number is 45414833. A replay of the webcast will be available on the Company's website.

About WEX Inc.

WEX Inc. (NYSE:WEX) is a leading provider of corporate payment solutions. From its roots in fleet card payments beginning in 1983, WEX has expanded the scope of its business into a multi-channel provider of corporate payment solutions representing more than 10 million vehicles and offering exceptional payment security and control across a wide spectrum of business sectors. WEX serves a global set of customers and partners through its operations around the world, with offices in the United States, Australia, New Zealand, Brazil, the United Kingdom, Italy, France, Germany, Norway, and Singapore. WEX and its subsidiaries employ more than 2,700 associates. The Company has been publicly traded since 2005, and is listed on the New York Stock Exchange under the ticker symbol “WEX.” For more information, visit www.wexinc.com and follow WEX on Twitter at @WEXIncNews.

Forward-Looking Statements

This news release contains forward-looking statements, including statements regarding: management’s expectations for future corporate performance; financial guidance; and, assumptions underlying the Company's financial guidance. Any statements that are not statements of historical facts may be deemed to be forward-looking statements. When used in this news release, the words "may," "could," "anticipate," "plan," "continue," "project," "intend," "estimate," "believe," "expect" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such words. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially, including: the effects of general economic conditions on fueling patterns as well as payment and transaction processing activity; the impact of foreign currency exchange rates on the Company’s operations, revenue and income; changes in interest rates; the impact of fluctuations in fuel prices; the effects of the Company’s business expansion and acquisition efforts; potential adverse changes to business or employee relationships, including those resulting from the completion of an acquisition; competitive responses to any acquisitions; uncertainty of the expected financial performance of the combined operations following completion of an acquisition; the ability to successfully integrate the Company's acquisitions, including Electronic Funds Source LLC's operations and employees; the ability to realize anticipated synergies and cost savings; unexpected costs, charges or expenses resulting from an acquisition; the Company's failure to successfully operate and expand ExxonMobil's European and Asian commercial fuel card programs; the failure of corporate investments to result in anticipated strategic value; the impact and size of credit losses; the impact of changes to the Company's credit standards; breaches of the Company’s technology systems or those of our third-party service providers and any resulting negative impact on our reputation, liabilities or relationships with customers or merchants; the Company’s failure to maintain or renew key agreements; failure to expand the Company’s technological capabilities and service offerings as rapidly as the Company’s competitors; failure to successfully implement the Company’s information technology strategies and capabilities in connection with its technology outsourcing and insourcing arrangements and any resulting cost associated with that failure; the actions of regulatory bodies, including banking and securities regulators, or possible changes in banking or financial regulations impacting the Company’s industrial bank, the Company as the corporate parent or other subsidiaries or affiliates; the impact of the Company’s outstanding notes on its operations; the impact of increased leverage on the Company's operations, results or borrowing capacity generally, and as a result of acquisitions specifically; the incurrence of impairment charges if our assessment of the fair value of certain of our reporting units changes; the uncertainties of litigation; as well as other risks and uncertainties identified in Item 1A of our Annual Report for the year ended December 31, 2016, filed on Form 10-K with the Securities and Exchange Commission on March 6, 2017 and our Quarterly Report on Form 10-Q for the three months ended March 31, 2017 filed with the Securities and Exchange Commission on May 8, 2017. The Company's forward-looking statements do not reflect the potential future impact of any alliance, merger, acquisition, disposition or stock repurchases. The forward-looking statements speak only as of the date of this earnings release and undue reliance should not be placed on these statements. The Company disclaims any obligation to update any forward-looking statements as a result of new information, future events or otherwise.

 

WEX INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share data)

(unaudited)

   
Three months ended
June 30,
 

Six months ended
June 30,

2017   2016   2017   2016
Revenues  
Payment processing revenue $ 141,354 $ 126,080 $ 277,732 $ 237,136
Account servicing revenue 65,677 47,433 127,216 91,955
Finance fee revenue 42,085 32,704 85,457 56,210
Other revenue 54,768   27,719     104,836     54,563  
Total revenues 303,884 233,936 595,241 439,864
Expenses
Salary and other personnel 85,811 66,662 169,396 130,072
Restructuring 1,676 3,506 2,160 5,095
Service fees 37,351 45,924 74,101 82,683
Provision for credit losses 16,082 6,443 28,313 10,360
Technology leasing and support 14,101 10,932 26,617 22,008
Occupancy and equipment 6,459 6,113 12,826 11,825
Depreciation and amortization 49,961 23,109 99,199 45,373
Operating interest expense 4,464 1,505 9,312 2,891
Cost of hardware and equipment sold 1,098 665 2,127 1,570
Impairment charge 16,175 16,175
Other expenses 23,125   17,442     46,682     35,225  
Total operating expenses 256,303   182,301     486,908     347,102  
Operating income 47,581 51,635 108,333 92,762
Financing interest expense (28,547 ) (30,418 ) (55,695 ) (51,976 )
Net foreign currency gain (loss) 10,525 (4,823 ) 18,967 11,301
Net unrealized loss on interest rate swap agreements (2,264 ) (699 )
Net realized and unrealized gain on fuel price derivatives           711  
Income before income taxes 27,295 16,394 70,906 52,798
Income taxes 10,655   4,482     25,190     17,665  
Net income 16,640 11,912 45,716 35,133
Less: Net loss from non-controlling interest (450 ) (655 )   (775 )   (520 )
Net earnings attributable to shareholders $ 17,090   $ 12,567     $ 46,491     $ 35,653  
Net earnings attributable to WEX Inc. per share:
Basic $ 0.40 $ 0.32 $ 1.08 $ 0.92
Diluted $ 0.40 $ 0.32 $ 1.08 $ 0.92
Weighted average common shares outstanding:
Basic 43,002 38,806 42,937 38,781
Diluted 43,060 38,857 43,090 38,850
 

   

WEX INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

(unaudited)

   
June 30,
2017
December 31,
2016
Assets
Cash and cash equivalents $ 219,001 $ 190,930
Accounts receivable (less reserve for credit losses of $26,758 in 2017 and $20,092 in 2016) 2,478,703 2,054,701
Securitized accounts receivable, restricted 98,186 97,417
Income taxes receivable 2,926 10,765
Available-for-sale securities 23,653 23,525
Property, equipment and capitalized software (net of accumulated depreciation of $251,074 in 2017 and $228,336 in 2016) 177,399 167,278
Deferred income taxes, net 13,354 6,934
Goodwill 1,808,192 1,838,441
Other intangible assets (net of accumulated amortization of $334,394 in 2017 and $254,143 in 2016) 1,192,093 1,265,468
Other assets 335,452   341,638  
Total assets $ 6,348,959   $ 5,997,097  
Liabilities and Stockholders’ Equity
Accounts payable $ 727,587 $ 617,118
Accrued expenses 320,243 331,579
Deposits 1,122,671 1,118,823
Securitized debt 104,525 84,323
Revolving line of credit facilities and term loans, net 1,740,201 1,599,291
Deferred income taxes, net 139,802 152,906
Notes outstanding, net 395,902 395,534
Other debt 149,063 125,755
Amounts due under tax receivable agreement 41,403 47,302
Other liabilities 27,921   18,719  
Total liabilities 4,769,318 4,491,350
Commitments and contingencies
Stockholders’ Equity
Common stock $0.01 par value; 175,000 shares authorized; 47,343 shares issued in 2017 and 47,173 in 2016; 42,915 shares outstanding in 2017 and 42,841 in 2016 473 472
Additional paid-in capital 552,733 547,627
Non-controlling interest 8,324 8,558
Retained earnings 1,291,022 1,244,271
Accumulated other comprehensive loss (100,569 ) (122,839 )
Treasury stock at cost; 4,428 shares in 2017 and 2016 (172,342 ) (172,342 )
Total stockholders’ equity 1,579,641   1,505,747  
Total liabilities and stockholders’ equity $ 6,348,959   $ 5,997,097  
 

 

Exhibit 1

Reconciliation of GAAP Net Earnings Attributable to Shareholders to Adjusted Net Income Attributable to Shareholders

(in thousands, excepts per share data)

(unaudited)

 
  Three months ended
June 30,
2017   2016
       

per diluted
share

     

per diluted
share

Net earnings attributable to shareholders $ 17,090   $ 0.40   $ 12,567   $ 0.32
Unrealized losses on derivative instruments 2,264 0.05
Net foreign currency remeasurement (gain) loss (10,525 ) (0.24 ) 4,823 0.12
Acquisition-related ticking fees 19,511 0.50
Acquisition-related intangible amortization 38,114 0.89 12,565 0.32
Other acquisition and divestiture related items 239 0.01 2,179 0.06
Stock-based compensation 7,414 0.17 4,870 0.13
Restructuring and other costs 2,398 0.06 5,985 0.15
Impairment charge 16,175 0.38
Debt issuance cost amortization 2,209 0.05 771 0.02
ANI adjustments attributable to non-controlling interest (156 ) (930 ) (0.02 )
Tax related items (21,022 )   (0.49 )   (19,775 )   (0.51 )
Adjusted net income attributable to shareholders $ 54,200 $ 1.26 $ 42,566 $ 1.10
 

Six months ended
June 30,

2017   2016
       

per diluted
share

     

per diluted
share

Net earnings attributable to shareholders $ 46,491 $ 1.08 $ 35,653 $ 0.92
Unrealized losses on derivative instruments 699 0.02 5,007 0.13
Net foreign currency remeasurement gain (18,967 ) (0.44 ) (11,301 ) (0.29 )
Acquisition-related ticking fees 30,045 0.77
Acquisition-related intangible amortization 76,093 1.77 25,211 0.65
Other acquisition and divestiture related items 2,374 0.06 6,944 0.18
Stock-based compensation 13,871 0.32 9,113 0.23
Restructuring and other costs 4,145 0.10 7,574 0.19
Impairment charge 16,175 0.38
Debt issuance cost amortization 4,163 0.10 1,543 0.04
ANI adjustments attributable to non-controlling interest (955 ) (0.02 ) (861 ) (0.02 )
Tax related items (37,001 )   (0.86 )   (28,291 )   (0.73 )
Adjusted net income attributable to shareholders $ 107,088 $ 2.49 $ 80,637 $ 2.08
 

The Company's non-GAAP adjusted net income excludes unrealized gains and losses on derivatives, net foreign currency remeasurement gains and losses, acquisition-related ticking fees, acquisition-related intangible amortization, other acquisition and divestiture related items, stock-based compensation, restructuring and other costs, debt issuance cost amortization, similar adjustments attributed to our non-controlling interest and certain tax related items. In addition, for the second quarter of 2017, we have excluded an impairment charge related to the insourcing of certain technology functions from a third party.

Although adjusted net income is not calculated in accordance with generally accepted accounting principles (GAAP), this non-GAAP measure is integral to the Company's reporting and planning processes and the chief operating decision maker of the Company uses pre-tax adjusted income to allocate resources. The Company considers this measure integral because it excludes specified items that the Company's management excludes in evaluating the Company's performance. Specifically, in addition to evaluating the Company's performance on a GAAP basis, management evaluates the Company's performance on a basis that excludes the above items because:

  • Exclusion of the non-cash, mark-to-market adjustments on derivative instruments, including fuel price related derivatives and interest rate swap agreements, helps management identify and assess trends in the Company's underlying business that might otherwise be obscured due to quarterly non-cash earnings fluctuations associated with these derivative contracts.
  • Net foreign currency gains and losses primarily result from the remeasurement to functional currency of cash, receivable and payable balances, certain intercompany notes denominated in foreign currencies and any gain or loss on foreign currency hedges relating to these items. The exclusion of these items helps management compare changes in operating results between periods that might otherwise be obscured due to currency fluctuations.
  • The Company considers certain acquisition-related costs, including certain financing costs, ticking fees, investment banking fees, warranty and indemnity insurance, certain integration related expenses and amortization of acquired intangibles, as well as gains and losses from divestitures to be unpredictable, dependent on factors that may be outside of our control and unrelated to the continuing operations of the acquired or divested business or the Company. In prior periods not reflected above, the Company has adjusted for goodwill impairments and acquisition related asset impairments. In addition, the size and complexity of an acquisition, which often drives the magnitude of acquisition-related costs, may not be indicative of such future costs. The Company believes that excluding acquisition-related costs and gains or losses of divestitures facilitates the comparison of our financial results to the Company's historical operating results and to other companies in our industry.
  • Stock-based compensation is different from other forms of compensation, as it is a non-cash expense. For example, a cash salary generally has a fixed and unvarying cash cost. In contrast, the expense associated with an equity-based award is generally unrelated to the amount of cash ultimately received by the employee, and the cost to the Company is based on a stock-based compensation valuation methodology and underlying assumptions that may vary over time.
  • Restructuring costs are related to employee termination benefits from certain identified initiatives to further streamline the business, improve the Company's efficiency, create synergies, and to globalize the Company's operations, all with an objective to improve scale and increase profitability going forward. We exclude these items when evaluating our continuing business performance as such items are not consistently occurring and do not reflect expected future operating expense, nor provide insight into the fundamentals of current or past operations of our business.
  • Impairment charge represents a non-cash asset write-off related to our strategic decision to in-source certain technology functions. This charge does not reflect recurring costs that would be relevant to our continuing operations. The Company believes that excluding this nonrecurring expense facilitates the comparison of our financial results to the Company's historical operating results and to other companies in our industry.
  • Debt issuance cost amortization is a non-cash item and is unrelated to the continuing operations of the Company. Because these costs are dependent upon the financing method which can vary widely company to company, we believe that excluding these costs helps to facilitate comparison to historical results as well as to other companies within our industry.
  • The adjustments attributable to non-controlling interests, including adjustments to the redemption value of a non-controlling interest, and the non-cash adjustments related to tax receivable agreement have no significant impact on the ongoing operations of the business.
  • The tax related items are the difference between the Company’s U.S. GAAP tax provision and a pro forma tax provision based upon the Company’s adjusted net income before taxes as well as the impact from certain discrete tax items. The methodology utilized for calculating the Company’s adjusted net income tax provision is the same methodology utilized in calculating the Company’s U.S. GAAP tax provision.

For the same reasons, WEX believes that adjusted net income may also be useful to investors as one means of evaluating the Company's performance. However, because adjusted net income is a non-GAAP measure, it should not be considered as a substitute for, or superior to, net income, operating income or cash flows from operating activities as determined in accordance with GAAP. In addition, adjusted net income as used by WEX may not be comparable to similarly titled measures employed by other companies.

The table below shows the impact of certain macro factors on reported revenue:

Exhibit 2

Segment Revenue Results

(in thousands)

(unaudited)

  Fleet Solutions  

Travel and Corporate
Solutions

 

Health and Employee
Benefit Solutions

  Total WEX Inc.
Three months ended June 30,
  2017     2016     2017     2016     2017       2016     2017     2016
Reported revenue $ 200,304   143,960 $ 55,000   $ 53,336 $ 48,580   $ 36,640 $ 303,884   $ 233,936
 
FX impact (favorable) / unfavorable 366 1,018 (717 ) 667
 
PPG impact (favorable) / unfavorable   (8,147 )                         (8,147 )  
 
Six months ended June 30,
  2017     2016     2017     2016     2017       2016   2017     2016
Reported revenue $ 391,127 265,034 $ 102,713 $ 98,478 $ 101,401 $ 76,352 $ 595,241 $ 439,864
 
FX impact (favorable) / unfavorable 447 1,933 (2,578 ) (198 )
 
PPG impact (favorable) / unfavorable   (23,578 )                         (23,578 )  
 

To determine the impact of foreign exchange translation (“FX”) on revenue, revenue from entities whose functional currency is not denominated in U.S. dollars, as well as revenue from purchase volume transacted in non-U.S. denominated currencies, were translated using the weighted average exchange rates for the same period in the prior year.

To determine the impact of price per gallon of fuel (“PPG”) on revenue, revenue variable to changes in fuel prices was calculated based on the average retail price of fuel for the same period in the prior year for the portion of our business that earns revenue based on a percentage of fuel spend. For the portions of our business that earns revenue based on margin spreads, revenue was calculated utilizing the comparable margin from the prior year.

The table below shows the impact of certain macro factors on Adjusted Net Income:

Segment Estimated Earnings Impact

(in thousands)

(unaudited)

  Fleet Solutions  

Travel and Corporate
Solutions

 

Health and Employee
Benefit Solutions

Three months ended June 30,
  2017     2016     2017   2016     2017   2016
FX impact (favorable) / unfavorable $ 65   $ 267   $ (116 )
PPG impact (favorable) / unfavorable (4,653 )
 
Six months ended June 30,
  2017     2016     2017   2016     2017   2016
FX impact (favorable) / unfavorable $ 121 $ 521 $ (423 )
PPG impact (favorable) / unfavorable (13,528 )
Realized gain on hedge settlement       3,636            
 

To determine the estimated earnings impact of FX, revenue and expenses from entities whose functional currency is not denominated in U.S. dollars, as well as revenue and variable expenses from purchase volume transacted in non-US denominated currencies, were translated using the weighted average exchange rates for the same period in the prior year, net of tax and non-controlling interest where applicable.

To determine the estimated earnings impact of PPG, revenue and certain variable expenses impacted by changes in fuel prices, were adjusted based on the average retail price of fuel for the same period in the prior year for the portion of our business that earns revenue based on a percentage of fuel spend, net of applicable taxes. For the portions of our business that earn revenue based on margin spreads, revenue was adjusted to the comparable margin from the prior year, net of non-controlling interest and applicable taxes.

 
Exhibit 3
Selected Non-Financial Metrics

(unaudited)

  Q2 2017   Q1 2017   Q4 2016   Q3 2016   Q2 2016
Fleet Solutions – Payment Processing Revenue:        
Payment processing transactions (000s) 108,134 102,765 99,662 102,947 94,155
Gallons per payment processing transaction 26.9 27.0 27.4 27.0 22.6
Payment processing gallons of fuel (000s) 2,907,875 2,775,590 2,731,994 2,776,622 2,126,372
Average US fuel price (US$ / gallon) $ 2.41 $ 2.40 $ 2.30 $ 2.24 $ 2.29
Average Australian fuel price (US$ / gallon) $ 3.65 $ 3.76 $ 3.50 $ 3.45 $ 3.29
Payment processing $ of fuel (000s) $ 7,399,901 $ 7,080,117 $ 6,672,281 $ 6,593,406 $ 5,236,151
Net payment processing rate 1.18 % 1.22 % 1.23 % 1.26 % 1.35 %
Payment processing revenue (000s) $ 87,678 $ 86,262 $ 81,767 $ 83,132 $ 70,711
Travel and Corporate Solutions – Payment Processing Revenue:
Purchase volume (000s) $ 7,676,935 $ 6,599,797 $ 6,351,741 $ 7,138,956 $ 5,595,326
Net interchange rate 0.52 % 0.53 % 0.71 % 0.74 % 0.77 %
Payment processing revenue (000s) $ 40,276 $ 34,875 $ 45,390 $ 52,551 $ 43,194
Health and Employee Benefit Solutions:
Purchase volume (000s) $ 1,126,854 $ 1,347,219 $ 803,045 $ 875,598 $ 1,051,839
 

Definitions and explanations:

Payment processing transactions represents the total number of purchases made by fleets that have a payment processing relationship with WEX.

Payment processing gallons of fuel represents the total number of gallons of fuel purchased by fleets that have a payment processing relationship with WEX.

Payment processing dollars of fuel represents the total dollar value of the fuel purchased by fleets that have a payment processing relationship with WEX.

Net payment processing rate represents the percentage of the dollar value of each payment processing transaction that WEX records as revenue from merchants less any discounts given to fleets or strategic relationships.

Purchase volume in the Travel and Corporate Solutions segment represents the total dollar value of all transactions that use WEX corporate card products and virtual card products.

Net interchange rate represents the percentage of the dollar value of each transaction that WEX records as revenue less any discounts given to customers.

Purchase volume in the Health and Employee Benefit Solutions segment represents the total US dollar value of all transactions where interchange is earned by WEX.

 
Exhibit 4

Segment Revenue Information

(in thousands)

(unaudited)

Fleet Solutions                      

Three months ended
June 30,

  Increase (decrease)  

Six months ended
June 30,

  Increase (decrease)
  2017 2016   Amount Percent   2017 2016   Amount Percent
Revenues      
Payment processing revenue $ 87,678 $ 70,711 $ 16,967 24.0 % $ 173,940 $ 133,001 $ 40,939 30.8 %
Account servicing revenue 41,311 27,548 13,763 50.0 % 77,380 52,986 24,394 46.0 %
Finance fee revenue 36,552 30,674 5,878 19.2 % 72,981 52,611 20,370 38.7 %
Other revenue 34,763   15,027     19,736   131.3 %   66,826   26,436     40,390   152.8 %
Total revenues $ 200,304 $ 143,960 $ 56,344 39.1 % $ 391,127 $ 265,034 $ 126,093 47.6 %
 

Travel and Corporate
Solutions

                     

Three months ended
June 30,

  Increase (decrease)  

Six months ended
June 30,

  Increase (decrease)
  2017 2016   Amount Percent   2017 2016   Amount Percent
Revenues      
Payment processing revenue $ 40,276 $ 43,194 $ (2,918 ) (6.8 )% $ 75,151 $ 77,820 $ (2,669 ) (3.4 )%
Account servicing revenue 167 337 (170 ) (50.4 )% 322 610 (288 ) (47.2 )%
Finance fee revenue 159 145 14 9.7 % 382 221 161 72.9 %
Other revenue 14,398   9,660     4,738   49.0 %   26,858   19,827     7,031   35.5 %
Total revenues $ 55,000 $ 53,336 $ 1,664 3.1 % $ 102,713 $ 98,478 $ 4,235 4.3 %
 

Health and Employee
Benefit Solutions

                     

Three months ended
June 30,

  Increase (decrease)  

Six months ended
June 30,

  Increase (decrease)
  2017 2016   Amount Percent   2017 2016   Amount Percent
Revenues      
Payment processing revenue $ 13,400 $ 12,175 $ 1,225 10.1 % $ 28,641 $ 26,315 $ 2,326 8.8 %
Account servicing revenue 24,199 19,548 4,651 23.8 % 49,514 38,359 11,155 29.1 %
Finance fee revenue 5,374 1,885 3,489 185.1 % 12,094 3,378 8,716 258.0 %
Other revenue 5,607   3,032   2,575   84.9 %   11,152   8,300   2,852   34.4 %
Total revenues $ 48,580 $ 36,640 $ 11,940 32.6 % $ 101,401 $ 76,352 $ 25,049 32.8 %

Source: WEX Inc.

News media:
WEX Inc.
Jessica Roy, 207-523-6763
Jessica.Roy@wexinc.com
or
Investors:
WEX Inc.
Steve Elder, 207-523-7769
Steve.Elder@wexinc.com

How Can We Help You?

Request More Information
Education_83402440_Callout_442x184
Virtual Education Payment Solutions

WEX virtual payment solutions can help save money, and even get cash back, when you pay suppliers. And our precise management and reporting solutions will free you to focus on your most critical mission – delivering quality education

Learn More
WEX Virtual Insurance Payment Solutions

WEX Virtual Payment Solutions are a more secure way to pay preferred and out-of-network suppliers, which can save you money and preserve customer loyalty.

Learn More
P-Card_151910011_Callout_442x184
WEX P-Cards

WEX Purchasing Cards, or P-Cards, help companies manage costs and reduce paperwork by providing details about employee spending. Additionally, they provide precise information, insights and control over how and where your company dollars are spent.

Learn More
Virtual Payments
WEX Virtual Payment for Media

WEX virtual payment solutions seamlessly interface with many of the widely used media platforms, allowing for improved operational efficiencies, and real-time payment processing.

Learn More

WEX Fleet

WEX offers the most popular fleet cards in the nation, accepted at over 90 percent of the nation’s retail fuel locations and over 45,000 vehicle maintenance locations.

Read More

WEX Travel Payment Solutions

Drive down costs and increase productivity across the travel spectrum. Streamline and automate even the most complex payment scenarios.

Read More