WEX first quarter financials beat analysts’ expectations
WEX Inc. (NYSE:WEX) reported today its total revenue for the first quarter ended March 31 increased 2% to $205.9 million, compared with $202.3 million reported in the first quarter of 2015. First quarter net income was $23.1 million, compared with $22.3 million a year ago.
The results exceeded Wall Street analysts’ expectations, with MarketDigest reporting that the consensus estimates of its analysts had expected Q1 revenue to be $199.87 million and earnings per share to be $0.86, 11 cents lower than the $0.97 earnings WEX actually reported for the quarter.
In a statement accompanying the earnings report, WEX President and CEO Melissa Smith noted the first quarter results had exceeded the company’s “top and bottom line expectations” as well. “Our focus on simplification through innovative technology, user-friendly tools and industry-leading customer service continues to fuel our growth,” she said in the statement.
In a telephone interview with Mainebiz prior to a morning conference call with investors, Smith highlighted what she described as “organic growth” in the company’s travel and corporate solutions division resulting in an 18% increase in total card purchase volume to $4.9 billion for the quarter. That resulted in a 4.8% overall increase for that division’s revenues, which came in at $45.14 million for the quarter.
Big gains also were reported by WEX’S health and employee benefits division, which reported a 29.3% revenue increase to $39.71 million for the quarter, compared with $30.72 million for the same period last year.
Although the company’s fleet card division continues to be adversely affected by lower fuel prices — first quarter revenue of $121 million is down 5.8% from the $128.49 million reported a year ago — Smith noted the division has rolled out two new products developed here in Maine that she said will give fleet managers more data about fuel costs and other performance indicators that can help them identify areas for improvement.
The underlying technology, she said, has the potential to be applicable in the company’s travel, corporate payment and health payment divisions as well.
Looking ahead, Smith said the company expects to continue to reap “the benefits of our targeted investment strategy, further increase scale and extend our reach in both the U.S. and around the world. Overall, we feel very good about our position in the market as we continue to elevate our market leadership and enhance our product and service portfolio to meet the diverse needs of our global customers.”
For the second quarter of 2016, WEX expects revenue in the range of $216 million to $226 million and adjusted net income in the range of $37 million to $40 million. For the full year, it expects revenue in the range of $879 million to $909 million and adjusted net income in the range of $158 million to $170 million.
In mid-morning trading, WEX’s stock was selling at $95.10 per share, up 5.47% from the Tuesday’s closing price of $90.25.
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