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| Statement |
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| We've released four new products into the marketplace this year, each with really terrific potential |
| It clearly demonstrates the growth of our diversified business and the strength of our business model that generated over $1.25 billion of free cash flow |
| So I think we'll continue to see good performance in 2024 |
| In summary, we're proud of the performance we delivered in 2023 |
| This positive operating leverage is driven by solid revenue growth, lower bad debt expense, disciplined expense management and synergies realized from recent acquisitions |
| Despite the recent soft quarters, we are confident that this business can return to low double digit growth over the coming quarters |
| And then third, our Corporate Payments business is growing faster and it has higher retention rates than our fuel card business |
| Our digital and field sales efforts are improving as we continue to see growth in applications, approvals and starts |
| We are leveraging our strong success in the UK to launch our consumer vehicles payment solution in the market |
| We see that the margins have been grinding higher across all the segments, and especially within the Vehicle Payments and Corporate Payments |
| Our success in Brazil is a tangible proof point of our broader vehicle payments vision to leverage and anchor product used by a large customer base and to then add additional services via mobile app, driving incremental revenue growth |
| Sales grew 12% overall with a terrific performance in corporate payments |
| So I would say that it's setting up at this moment to be super positive, so we’re super happy with it |
| In addition, we're having great success selling our at home charging solution with a 30% attachment rate to all new sales |
| Our EV strategy in the UK is clearly winning as our 3-in-1 product, fuel, on road charging and at home charging, all-in-one app has more than doubled from a year ago |
| Vehicle payments organic revenue increased 5% during the quarter with particular strength in Brazil and international fuel markets |
| Revenue growth is projected to be between 8% and 10% and EBITDA is expected to increase 10% to 12% with margin expanding to approximately 54% |
| Excluding Russia, cash EPS is growing 17% to 19%, revenue is up 10% to 12% and EBITDA is increasing 13% to 15%, all slightly above our midterm growth targets |
| EBITDA margin in the quarter was 54.2%, a 220 basis point improvement from the fourth quarter of last year |
| Additionally, we did advance a number of important strategic initiatives in the year, progressed EV and our understanding of the relative economics of EV versus ICE, so promising results there |
| More importantly, our best in class technology, service and products allow us to have market leading retention and client acquisition, which you can see in our results |
| We expect revenue growth to accelerate in the back half of the year as the economic outlook becomes clear |
| Cross border revenue was up 21%, sales grew 51% and recurring client transaction activity was robust |
| Third, we hope to build out our vehicle payments business with proof of successful cross selling and accelerate revenue growth throughout the year |
| Excluding the partner channel, revenue grew 20% and spend volumes increased 27% in the quarter, so quite strong on a core basis |
| Our full suite of high quality payment solutions continues to sell extremely well with sales up 27% this quarter as we signed up customers who are looking to modernize their AP operations |
| The revenue weakness was mostly offset by strong expense discipline, continued improvements in bad debt expense and a lower tax rate, which delivered $4.44 per share in cash EPS within our guidance and up 10% versus last year |
| We are expecting good earnings flow through to EPS |
| One, revenue will grow faster throughout the year than expense, so that operating leverage will help |
| Before completing my prepared remarks, I would like to extend our gratitude to our more than 10,000 employees around the world who helped us deliver such a great year and who will be the driving force to even greater heights throughout 2024 |
| Statement |
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| Related to the quarters, we expect revenue growth in the first half of the year to be below our full year average due to the continued pockets of softness, a tough comp that includes Russia, as well as a challenging operating environment, including lower fuel prices |
| If you go back and look at what we communicated in '23, we would have talked about lodging having some softness in the base, the partner channel and payables having some softness, the pivot from micro accounts, which shed a bunch of late fees, unfortunately, credit losses |
| This quarter was affected by continued softness in our existing workforce customers, which appears to have now stabilized |
| And so, hey, we lose a little bit of revenue and we lose a lot of volume |
| The revenue weakness in the quarter showed up in a few areas |
| And what we call same store sales finished 3% down |
| Revenue growth was slightly below our expectations due to pockets of softness, mostly in US vehicle payments and lodging, while our corporate payments and international businesses continued to perform well |
| And then the last year as our corporate payments or payables business with the channel partner business finishing even softer than we had outlook, fortunately there, we think it's bottomed out |
| Again, we saw the weakness in the workforce lodging and the airline lodging business, and a bit in the UK |
| In lodging, we had a pretty soft distressed passenger vertical in the quarter, mostly because airline cancellations were at a record low level |
| And in the fourth quarter, cancellations were down approximately 90% from Q4 '22 |
| In the US, softness in small fleet and the impact from our shift away from micro clients continue to affect our sales and revenue results |
| Obviously, we had a pivot in this vehicle thing and then a bit distracted working on this restructuring |
| But corporate volumes were down about 15% sequentially, it must have been low yielding volumes that fell off |
| As we mentioned last quarter, the shift to higher credit quality clients also impacted late fees, which were down 38% from Q4 '22 |
| Similarly, on the insurance side, we saw the decline in the overall insurance |
| I'd note that the drag from lower partner channel volumes accelerated in the quarter with channel revenue declining 31% |
| We expect fuel prices to be a headwind in the first quarter |
| Workforce, we continue to see a little bit of softness there |
| The organic revenue growth in Q4, 7% overall, again impacted by the soft spots I just called out |
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