WEX Inc. caps another record year, in strong position of growth for 2019

Photo / Peter Van Allen Melissa Smith, president and CEO of WEX Inc., speaks to Michael Dubyak, chairman of WEX and Smith's predecessor as CEO, and Liz Cotter Schlax (back to camera) at the ribbon cutting for the new WEX headquarters in Portland earlier this month. The company this week announced another record year of growth.

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By James McCarthy

Spurred by stronger-than-expected fourth quarter revenues, WEX Inc. reported Wednesday that for the full year in 2018 its revenue increased to $1.49 billion, up 20% from $1.25 billion in 2017.

It was another record year for WEX (NYSE: WEX), which said its fourth quarter revenue of $381.2 million represented a 15% increase from $331.6 million in 2017’s fourth quarter. It was the 10th consecutive quarter of double-digit revenue growth for the Portland-based corporate payment-processing company.

"Our performance this quarter capped another outstanding year for WEX, underscored by record revenue, new and innovative products and strategic M&A that has expanded our penetration into the high-growth and dynamic corporate payments and consumer-directed health care markets,” WEX President and CEO Melissa Smith said in a statement accompanying the earnings report.

In a telephone interview with Mainebiz following her late-afternoon conference call with investors, Smith credited WEX employees for their strong performance in executing company goals set at the start of 2018, which she called “strategic pillars” that will make a strong foundation for sustained growth over the long term, including:

Building upon WEX’s “best-in-class” technology in its fleet card, travel and corporate payment and health and employee benefits divisions.
Delivering scale through superior execution.
Leveraging WEX’s Maine-based culture to attract and retain the best employees.

Smith said she was particularly pleased that WEX again achieved recognition as a “Great Place to Work,” a certification based on employee responses to surveys designed to measure metrics ranging from integrity and innovation to wellness and camaraderie.

Looking ahead to 2019, Smith said WEX is in a strong position to build on 2018’s record growth, which each of its three divisions continuing to expand their market share and introducing new technologies and products that are expected “to enhance scalability.”

The $425 million cash acquisition of Discovery Benefits Inc., which closed on March 5, significantly strengthens WEX’s position in the health care marketplace. As one of the fastest-growing benefits solution providers in the marketplace with operations in all 50 states, Discovery Benefits enables WEX to “expand our penetration into the attractive high-growth consumer-directed health care market.”

It also diversifies the company’s mix of customers, she said.

Forward-looking comments

For the first quarter of 2019, WEX expects revenue in the range of $375 million to $380 million and adjusted net income in the range of $72 million to $74 million, or $1.64 to $1.70 per diluted share.

For the full year 2019, the company expects revenue in the range of $1.68 billion to $1.72 billion and adjusted net income in the range of $385 million to $403 million, or $8.80 to $9.20 per diluted share.

Smith said the company’s move into its new global headquarters in Portland’s eastern waterfront is an exciting time for her and WEX employees.

“It’s gone really well,” she said of the transition of approximately 400 employees from the company’s South Portland offices, where another 1,000 or more will continue to work, to the new 102,000-square-foot office building on Hancock Street. “You can smell the ocean … it’s more ‘Maine-like.’ It’s a different vibe. It reminds us all of why we are in Maine.”