WEX posts 22% increase in Q1 revenues

File Photo / Tim Greenway WEX President and CEO Melissa Smith reported today that the South Portland-based global company beat both its top line and bottom line projections in the first quarter of 2018.

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By James McCarthy

WEX Inc. (NYSE:WEX) today reported it beat both its top line and bottom line projections in the first quarter of 2018, with total revenues of $354.8 million increasing 22% over the $291.4 million reported for the same period a year ago.

Of that $63 million increase in the quarter, only $9 million was the result of higher fuel prices, the company stated in its first quarter earnings report released today.

In a telephone interview with Mainebiz this morning, WEX President and CEO Melissa Smith characterized the South Portland-based payment solutions company’s Q1 performance as a strong start to the year, driven by “strong contributions of our business segments.”

“We remain focused on our sustained ability to bring compelling new features and products to market, which is allowing us to continue to sign new customers, retain and grow our current base, and ultimately drive profitable growth,” she said.

WEX reported:

Fleet division revenues were $230.36 million for the quarter, up from $190.82 million a year ago.
Travel and corporate solutions revenues were $66.78 million, up from $47.71 million a year ago.
Health and employee benefits solution revenues were $57.68 million, up from $52.82 million a year ago.

“Our growth comes from all parts of our business,” Smith said, noting that the strong growth trend of the last two quarters has been built on technology advances across all of its business-to-business markets, renewing and winning new clients and continuing to capitalize on “organic” growth opportunities.

“We look forward to carrying this momentum through 2018,” she said.

As the company continues to expand globally across, Smith said she and her executive team have made a point of engaging employees across all three divisions in leadership programs, web conferences and other activities that help them connect their division’s activities to the company’s overall performance.

“We are constantly reinforcing the idea that we are one company,” Smith said. “We work better together [than if each division focused only on its own performance].”

A recent change reflecting WEX’s efforts to expand its reach in the European market is the hiring of Anant Patel in April as the company’s new managing director of Europe.

Patel will work out of WEX’s London office and brings to his role 17 years of expertise in “card-based products” that Smith said will help the company continue to scale up its operations in Europe.

Prior to joining WEX, Patel served as managing director of Europe, Middle East and Africa for First Performance Global.

Looking ahead

For the full year, WEX reported that it expects revenue in the range of $1.435 billion to $1.475 billion and adjusted net income in the range of $337 million to $355 million, or $7.75 to $8.15 per diluted share.

For the second quarter of 2018, WEX expects revenue in the range of $357 million to $367 million and adjusted net income in the range of $85 million to $90 million, or $1.96 to $2.06 per diluted share.

First quarter 2018 performance metrics

Average number of vehicles serviced was approximately 11.5 million, an increase of 8% from the first quarter of 2017.
Total fuel transactions processed increased 6% from the first quarter of 2017 to 131.8 million. Payment processing transactions increased 7% to 109.8 million.
U.S. retail fuel price increased 16% to $2.78 per gallon from $2.40 per gallon in the first quarter of 2017.
Travel and Corporate Solutions purchase volume grew 20% to $7.9 billion, from $6.6 billion in the first quarter of 2017.
Health and Employee Benefit Solutions average number of Software-as-a-Service (SaaS) accounts in the U.S. grew 26% to 10.8 million from 8.6 million in the first quarter of 2017.