Wex Inc. · NYSE:WEX
Wex — Q2 2020 Earnings Presentation
20 slides from Wex's earnings presentation, Jul 30, 2020
Slide 1: WEX Second Quarter 2020 Earnings
WEX Second Quarter 2020 Earnings July 30, 2020
Slide 2: Forward-Looking Statements
WEX Forward-Looking Statements These earnings materials contain forward-looking statements, including statements regarding: financial guidance; assumptions underlying the Company's financial guidance and the potential for providing the same; future growth opportunities and expectations; and, market
Slide 3: 2Q2020 Highlights
2Q2020 Highlights Fleet Travel & Corporate Health & Employee Benefits Down 21% Down 47% Down 51% 2Q2020 Segment Revenue Growth Vs. 2Q2019 +6% -40% -24% (1) (1) Represents US Healthcare purchase volume only(2) Approximately $2.4 billion of the decline in purchase volume was due to lower fuel prices (
Slide 4: Strategic Pillars: Highlights for the Quarter
Strategic Pillars HIGHLIGHTS FOR THE QUARTER Several high-profile customer wins across each segmentEmployees continue to work from home with successful technology transitionAdjustments made in cost structure to help offset impacts from COVID-19Targeted CAPEX deployment focused on areas of growth and
Slide 5: Executing on the WEX Strategy
Executing on the WEX Strategy FLEET TRAVEL & CORPORATE HEALTH & EMPLOYEE BENEFITS Migration of EG Fleet card onto WEX cloud-based platformMigration of Valero portfolio onto WEX platformContinuation of Cloud transitionBroadening rollout of Edge product to small fleets Transition of 70% of volume onto
Slide 6: Weekly Volume Metrics
Weekly Volume Metrics Key UpdatesJuly month-to-date domestic fuel price is $2.23Expect stabilization to gradual improvement going forward
Slide 7: Weekly Volume Metrics
Weekly Volume Metrics Key UpdatesSaaS account growth MTD in July is 13.2%Expect the trajectory of spend volumes in June and July to continue through the remainder of 2020 Customers begin to spend on elective healthcare procedures and resume a more normal cadence of doctor visits SaaS account growth
Slide 8: WEX Second Quarter 2020 Financial Results
WEX Second Quarter 2020 Financial Results
Slide 9: Company Results - Q2 2020
Company Results - Q2 2020 2Q20 2Q19 $ ∆ Yr/Yr % ∆ Yr/Yr Total Revenue $347,084 $441,807 $(94,723) (21)% Net income attributable to shareholders $72,658 $13,807 $58,851 426% Net income attributable to WEX Inc. per diluted share $1.66 $0.32 $1.34 419% Adjusted net income attributable to shareholders $
Slide 10: Revenue Breakdown - Q2 2020
Revenue Breakdown - Q2 2020 2Q20 2Q19 $ ∆ Yr/Yr % ∆ Yr/Yr Total Revenue $347,084 $441,807 -$94,723 (21)% Segment Revenue: Fleet Solutions $204,380 $267,314 -$62,934 (24)% Travel and Corporate Solutions $54,495 $91,350 -$36,855 (40)% Health and Employee Benefit Solutions $88,209 $83,143 $5,066 6% Con
Slide 11: Fleet Solutions
Fleet Solutions 2Q20 2Q19 $ ∆ Yr/Yr % ∆ Yr/Yr Total Segment Revenue ($) 204,380 267,314 (62,934) (24)% Payment Processing Revenue ($) 90,147 120,717 (30,570) (25)% Finance Fee Revenue ($) 42,463 62,385 (19,922) (32)% All Other Revenue ($) 71,770 84,212 (12,442) (15)% Payment Processing Transactions
Slide 12: Travel and Corporate Solutions
Travel and Corporate Solutions 2Q20 2Q19 $ ∆ Yr/Yr % ∆ Yr/Yr Total Segment Revenue ($) 54,495 91,350 (36,855) (40)% Payment Processing Revenue ($) 43,261 77,273 (34,012) (44)% All Other Revenue ($) 11,234 14,077 (2,843) (20)% Purchase Volume ($) 3,168,064 10,047,934 (6,879,870) (68)% Net Interchange
Slide 13: Health and Employee Benefit Solutions
Health and Employee Benefit Solutions 2Q20 2Q19 $ ∆ Yr/Yr % ∆ Yr/Yr Total Segment Revenue ($) 88,209 83,143 5,066 6% Payment Processing Revenue ($) 14,053 16,836 (2,783) (17)% Account Servicing Revenue ($) 62,602 54,669 7,933 15% All Other Revenue ($) 11,554 11,638 (84) (1)% Purchase Volume* ($) 1,0
Slide 14: Selected Operating Expenses
Selected Operating Expenses Service fees down due mainly to lower processing volumes and conversion to an internal transaction processing platform in the Travel and Corporate Payments segmentProvision for credit losses up mainly due to impacts of COVID-19 and other economic factors on our customers'
Slide 15: Tax Rate
Tax Rate Key UpdatesANI tax rate consistent with the prior year quarterGAAP tax rate unusually high due to a decrease in Pre-Tax Income, a shift in jurisdictional earnings and sizable nondeductible expenses partially offset by a discrete tax benefit
Slide 16: Additional Balance Sheet Items
Additional Balance Sheet Items Key UpdatesCorporate cash1 balance was $580 million Available borrowing capacity of $769 million on line of creditAmended credit facility including allowances for higher leverage and more liberal cash netting to calculate leverageLeverage ratio of 3.1XProceeds from the
Slide 17: Appendix
Appendix
Slide 18: Diversity and Inclusion
Diversity and Inclusion Areas of focus WORKPLACE WORKFORCE COMMUNITY MARKETPLACE Create a culture of inclusion to drive innovation Build tomorrow’s diverse workforce Embrace the diversity of our communities Cement D&I as a market imperative and as part of our reputation
Slide 19: WEX Non-GAAP Reconciliation
WEX Non-GAAP Reconciliation Three Months Ended June 30, 2020 2019 per diluted share per diluted share Net income attributable to shareholders $ 72,658 $ 1.66 $ 13,807 $ 0.32 Unrealized loss on financial instruments 3,842 0.09 21,516 0.49 Net foreign currency loss (gain) 2,462 0.06 (6,665) (0.15) Acq
Slide 20: Non-GAAP adjusted net income definition
The Company's non-GAAP adjusted net income excludes unrealized gains and losses on financial instruments, net foreign currency gains and losses, acquisition-related intangible amortization, other acquisition and divestiture related items, stock-based compensation, other costs, debt restructuring and