As if more evidence was needed that the fleet card business is alive and well, segment leader FleetCor Technologies reported Thursday (Oct. 30) that its third-quarter revenues jumped 31 percent to $295.3 million and its net income grew 21 percent to $95.5 million.
“We are pleased with our results for the quarter. North America had very strong organic growth in the quarter and we continue to see the benefits of the acquisitions we closed last year,” said Fleet Cor CEO Ron Clarke. “During the third quarter, we entered Germany with the Shell deal, acquired Pac Pride, and signed definitive documents to acquire Comdata.”
CFO Eric Dey added: “The third quarter was another strong quarter for the Company. While our business momentum remains strong, as we enter the fourth quarter, we are experiencing headwinds in foreign exchange rates that will impact our Q4 2014 revenue and net income, assuming exchange rates remain at current levels.”
In a call with analysts, Clarke said that the company is hoping to do well an anticipated higher fuel spread next year. But the worst situation, Clarke said, would be fuel prices that didn’t change much at all.
“Spreads come about due to volatility. The fuel prices have to move basically to create spreads going one way or the other. And so the worst situation for us would be low fuel prices just staying low, nothing happening,” the CEO said. “And what that would cause is we’d lose on the business models that are sensitive to absolute fuel price, and we’d probably run kind of what we call average market spreads, and so it’s the volatility price that seesawing up and down that create the spread opportunity.”