Payment of $51 Million Eliminates Liability Recorded at $187 Million
SOUTH PORTLAND, Maine--(BUSINESS WIRE)--Jun. 29, 2009--
Wright
Express Corporation (NYSE: WXS) announced today that it has prepaid
Realogy Corporation’s portion of Wright Express’ future payment
obligations under an existing tax receivable agreement with the former
parent company of both Wright Express and Realogy. Realogy was entitled
to 62.5% of these payments, which were scheduled to continue through
2020.
Prior to this transaction, Wright Express had a liability of
approximately $187 million for these payments. The Company has prepaid
this liability for $51 million. As a result, Wright Express will record
a gain of approximately $136 million pretax and $86 million after tax in
the second quarter of 2009.
“Our healthy cash flow and strong balance sheet have presented us with
an outstanding financial opportunity,” said Wright Express Chairman and
CEO Michael Dubyak. “We anticipate this $51 million prepayment will
deliver a cash payback in less than four years.”
About Wright Express
Wright
Express is a leading global provider of payment processing and
information management services. Wright Express captures and combines
transaction information from its proprietary network with specialized
analytical tools and purchasing control capabilities in a suite of
solutions that enable fleets to manage their vehicles more effectively.
The Company’s charge cards are used by commercial and government fleets
to purchase fuel and maintenance services for approximately 4.7 million
vehicles. Wright Express markets its services directly to fleets and as
an outsourcing partner for its strategic relationships and franchisees.
The Company’s business portfolio includes a MasterCard-branded corporate
card as well as TelaPoint, a provider of supply chain software solutions
for petroleum distributors and retailers, and Pacific Pride, an
independent fuel distributor franchisee network, as well as
international subsidiaries. For more information about Wright Express,
please visit www.wrightexpress.com.
This press release contains forward-looking statements, including
statements regarding: the Company’s expectation that it will receive a
gain of approximately $136 million pretax and $86 million after tax in
the second quarter of 2009; and the Company’s expectation that the $51
million prepayment of Realogy Corporation’s portion of Wright Express’
future payments under an existing tax receivable agreement with the
former parent company of both Wright Express and Realogy will deliver a
cash payback in less than four years. These forward-looking statements
include a number of risks and uncertainties that could cause actual
results to differ materially, including: changes in tax rates; corporate
financial results; volatility in fuel prices; future fueling patterns;
risks related to customer and counterparty bankruptcies and credit
failures; changes in interest rates; the effect of the Company’s
fuel-price-related derivative instruments; effects of competition; the
potential loss of key strategic relationships; decreased demand for fuel
and other vehicle products and services and the effects of general
economic conditions on the commercial activity of fleets; the Company’s
ability to rapidly implement new technology and systems; potential
corporate transactions including alliances, mergers, acquisitions and
divestitures; achievement of the expected benefits of the Company’s
alliances, mergers and acquisitions; and the other risks and
uncertainties included from time to time in the Company’s filings with
the Securities and Exchange Commission, including the annual report on
Form 10-K filed on February 27, 2009, and the Company’s other periodic
and current reports. Wright Express Corporation undertakes no obligation
to update these forward-looking statements at any future date or dates.
Source: Wright Express
News media contact:
Wright Express
Jessica Roy,
207-523-6763
Jessica_Roy@wrightexpress.com
or
Investor
contact:
Wright Express
Steve Elder, 207-523-7769
Steve_Elder@wrightexpress.com