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0000950135-07-004749.txt : 20070807
0000950135-07-004749.hdr.sgml : 20070807
20070807071453
ACCESSION NUMBER: 0000950135-07-004749
CONFORMED SUBMISSION TYPE: 8-K
PUBLIC DOCUMENT COUNT: 4
CONFORMED PERIOD OF REPORT: 20070807
ITEM INFORMATION: Results of Operations and Financial Condition
ITEM INFORMATION: Other Events
ITEM INFORMATION: Financial Statements and Exhibits
FILED AS OF DATE: 20070807
DATE AS OF CHANGE: 20070807
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: Wright Express CORP
CENTRAL INDEX KEY: 0001309108
STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-AUTOMOTIVE REPAIR, SERVICES & PARKING [7500]
IRS NUMBER: 010526993
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 8-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 001-32426
FILM NUMBER: 071029902
BUSINESS ADDRESS:
STREET 1: 97 DARLING AVENUE
CITY: SOUTH PORTLAND
STATE: ME
ZIP: 04106
BUSINESS PHONE: (207) 773-8171
MAIL ADDRESS:
STREET 1: 97 DARLING AVENUE
CITY: SOUTH PORTLAND
STATE: ME
ZIP: 04106
8-K
1
b66410wce8vk.htm
WRIGHT EXPRESS CORPORATION
e8vk
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) August 7, 2007 (August 7, 2007)
WRIGHT EXPRESS CORPORATION
(Exact name of registrant as specified in its charter)
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Delaware
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001-32426
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01-0526993 |
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(State or other jurisdiction of
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(Commission File Number)
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(IRS Employer Identification No.) |
incorporation) |
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97 Darling Avenue, South Portland, ME
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04106 |
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Address of principal executive offices
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Zip Code |
Registrants
telephone number, including area code (207) 773-8171
(Former name or former address if changes since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition
On August 7, 2007, we issued a press release announcing our first quarter 2007 results. A copy of
the press release is attached hereto as Exhibit 99.1, which is incorporated by reference in its
entirety.
The information in this item, including Exhibit 99.1, is being furnished, not filed. Accordingly,
the information in this item will not be incorporated by reference into any registration statement
filed by Wright Express under the Securities Act of 1933, as amended, unless specifically
identified therein as being incorporated therein by reference.
Item 8.01 Other Events.
On August 7, 2007, the Company issued a press release entitled Wright Express Adds Fuel Inventory
Solution with Acquisition of TelaPoint. A copy of the press release is attached as Exhibit 99.2
and is incorporated by reference in its entirety.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
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Exhibit No. |
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Description |
99.1*
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Press release of Wright Express Corporation dated August 7, 2007 |
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99.2*
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Press release of Wright Express Corporation dated August 7, 2007 |
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* Indicates that exhibit is filed with this report.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934 the registrant has duly caused
this report to be signed on its behalf by the undersigned hereunto duly authorized.
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WRIGHT EXPRESS CORPORATION
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Date: August 7, 2007 |
By: |
/s/ Melissa D. Smith
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Melissa D. Smith |
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Senior Vice President, Finance and
Chief Financial Officer (principal
financial officer) |
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WRIGHT EXPRESS CORPORATION
CURRENT REPORT ON FORM 8-K
Report Dated August 7, 2007
EXHIBIT INDEX
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Exhibit No. |
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Description |
99.1*
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Press release of Wright Express Corporation dated August 7, 2007 |
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99.2*
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Press release of Wright Express Corporation dated August 7, 2007 |
* Indicates that exhibit is filed with this report.
EX-99.1
2
b66410wcexv99w1.htm
EX-99.1 PRESS RELEASE DATED AUGUST 7, 2007
exv99w1
EXHIBIT 99.1
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News media contact:
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Investor contact: |
Jessica Roy
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Steve Elder |
Wright Express
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Wright Express |
207.523.6763
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207.523.7769 |
Jessica_Roy@wrightexpress.com
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Steve_Elder@wrightexpress.com |
Wright Express Reports Second-Quarter Financial Results
Quarterly Earnings Exceed Guidance; Revenue Grows 13%;
TelaPoint Acquisition Expands Range of Services Offered
SOUTH PORTLAND, MAINE August 7, 2007 Wright Express Corporation (NYSE: WXS), a
leading provider of payment processing and information management services to the U.S. commercial
and government fleet industry, today reported financial results for the second quarter ended June
30, 2007.
For the second quarter of 2007, total revenue increased 13% to $86.0 million from $76.2 million in
the second quarter of 2006. Net income to common shareholders on a GAAP basis was $18.3 million,
or $0.45 per diluted share, compared with $9.9 million, or $0.24 per share, for the comparable
quarter last year. On a non-GAAP basis, the Companys adjusted net income increased 45% to $20.5
million, or $0.50 per diluted share, from $14.1 million, or $0.34 per diluted share, for the
year-earlier period.
Wright Express uses fuel-price derivative instruments to mitigate financial risks associated with
the variability in fuel prices. For the second quarter of 2007, the Companys GAAP financial
results include an unrealized $4.0 million pre-tax, non-cash, mark-to-market loss on these
instruments. For the second quarter of 2006, the Company reported an unrealized pre-tax, non-cash,
mark-to-market loss of $7.5 million. Exhibit 1 reconciles adjusted net income for the second
quarters of 2007 and 2006, which has not been determined in accordance with GAAP, to net income as
determined in accordance with GAAP.
Management uses the non-GAAP measures presented within this news release to evaluate the Companys
performance on a comparable basis, to eliminate the volatility associated with its derivative
instruments, and to measure the amount of cash that is available for making payments on the
Companys financing debt and discretionary purposes. Management believes that investors may find
these measures useful for the same purposes, but cautions that they should not be considered a
substitute for disclosure in accordance with GAAP.
Second-Quarter 2007 Performance Metrics
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Payment processing transactions increased 16% to 53.2 million and transaction
processing transactions decreased 34% to 9.9 million, primarily reflecting the conversion
to payment processing of the Companys ExxonMobil portfolio in December 2006. Total fuel
transactions processed increased 3% from the second quarter of 2006 to 63.1 million |
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Average number of vehicles serviced was approximately 4.4 million, compared with
approximately 4.3 million in the second quarter of 2006. |
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Average expenditure per payment processing transaction increased 5% to $60.10 from
$57.45 for the same period last year. |
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Average retail fuel price was $2.95 per gallon, compared with $2.86 per gallon or a 3%
increase over the second quarter a year ago. |
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Total MasterCard purchase volume grew 40% to $464.4 million from $332.7 million for the
comparable period in 2006. |
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Wright Express repurchased approximately 210,000 shares of its common stock at a cost
of approximately $6.5 million during the second quarter of 2007. |
Additional selected non-financial metrics are presented in Exhibit 2.
Management Comments
Our financial results this quarter were strong with adjusted net income exceeding the top end of
our guidance, said Michael Dubyak, president and chief executive officer. This also was an
excellent quarter from a business standpoint, with solid demand for fleet cards and transaction
volume in line with expectations, as well as continued outstanding performance in MasterCard.
Our direct and co-brand sales channels are doing well, and we posted another strong quarter of
growth in our heavy truck segment, Dubyak said. In addition, sequential trends in our private
label channel were positive in the second quarter, suggesting the turnaround we forecasted for this
line of business is under way.
We expect the acquisition of
TelaPoint, which we announced today, to provide Wright Express with
an incremental revenue stream as well as an expansion of the range of services we offer, especially to fuel
merchants, said Dubyak. TelaPoints browser-based software product transforms fuel merchants,
distributors of all sizes and many commercial fleets - anyone with fuel storage tanks - into
sales prospects for a Wright Express fuel inventory solution. This is an attractive, value-added
complement to the fleet card relationship we have traditionally enjoyed with these key customers.
Looking forward, we remain confident about our prospects for the second half of the year, Dubyak
said. Transaction volume in our core business met internal expectations this quarter and our
pipeline of new business is favorable. We continue to execute successfully on our strategy to
capture a larger share of total U.S. fleet spend while developing other opportunities to grow our
revenue organically. The new credit facility we put in place during the quarter will give us
additional flexibility for future acquisitions and to repurchase shares, while significantly
reducing the cost of our debt. At the same time, as demonstrated by TelaPoint, we continue to seek
opportunities for alliances, mergers or acquisitions that can accelerate our overall growth and/or
enhance our strategic position.
2
Financial Guidance
Wright Express Corporation is issuing financial guidance for the third quarter of 2007 and updating
financial guidance for the full year 2007. The Companys guidance excludes the impact of non-cash,
mark-to-market adjustments on its fuel-price-related derivative instruments, as well as the
amortization of intangibles purchased in connection with the acquisition of TelaPoint. The fuel
prices referenced below are based on the applicable NYMEX futures price:
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For the third quarter of 2007, revenue in the range of $83 million to $88 million.
This is based on an assumed average retail fuel price of $2.97 per gallon. |
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Third-quarter 2007 adjusted net income, excluding unrealized gain or loss on derivative
instruments and amortization of purchased intangibles, in the range of $20 million to $22
million, or $0.50 to $0.53 per diluted share, based on approximately 41 million shares
outstanding. |
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For the full year 2007, revenue in the range of $320 million to $330 million. This is
based on an assumed average retail fuel price of $2.77 per gallon. |
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Net income for the full year 2007, excluding unrealized gain or loss on derivative
instruments and amortization of purchased intangibles, in the range of $74 million to $77
million, or $1.82 to $1.88 per diluted share, based on approximately 41 million shares
outstanding. |
Conference Call Details
In conjunction with this announcement, Wright Express will host a conference call today, August 7,
at 9:00 a.m. (ET) to discuss the Companys second-quarter financial results, the TelaPoint
acquisition and business outlook. The conference call will be webcast live on the Internet, and
can be accessed at the Investor Relations section of the Companys website
(www.wrightexpress.com). The live conference call can also be accessed by dialing (800) 479-1628
or (719) 457-2729. A replay of the webcast will be available on the Companys website for
approximately three months.
About Wright Express
Wright Express is a leading provider of payment processing and information management services to
the U.S. commercial and government vehicle fleet industry. Wright Express provides these services
for approximately 295,000 commercial and government fleets containing 4.4 million vehicles. Wright
Express markets these services directly as well as through more than 125 strategic relationships,
and offers a MasterCard-branded corporate card. The Company employs more than 675 people and
maintains its headquarters in South Portland, Maine. For more information about Wright Express,
please visit http://www.wrightexpress.com.
3
This press release contains forward-looking statements, including statements regarding Wright
Express Corporations: expectation of continued improvement in total transaction volume and
transaction volume in the private label channel; expectation of an incremental revenue stream and
expansion in the Companys range of services resulting from the acquisition of TelaPoint;
expectation that the new credit facility will provide additional flexibility for future
acquisitions, the repurchase shares and a reduction in the cost of debt; expectation of continued
successful execution of the Companys strategy to capture a larger share of total U.S. fleet spend
while developing other opportunities to grow our revenue organically; and guidance for
third-quarter and full-year 2007 results.
These forward-looking statements include a number of risks and uncertainties that could cause
actual results to differ materially. These risks and uncertainties include: volatility in fuel
prices; third-quarter and full-year 2007 fueling patterns; the effect of the Companys
fuel-price-related derivative instruments; effects of competition; the potential loss of key
strategic relationships; decreased demand for fuel and other vehicle products and services and the
effects of general economic conditions on the commercial activity of fleets; the Companys ability
to rapidly implement new technology and systems; potential corporate transactions including
alliances, mergers, acquisitions and divestitures; the risks associated with the profitability and integration of
TelaPoint, Inc.s operations; changes in interest rates and the other risks and uncertainties
included from time to time in the Companys filings with the Securities and Exchange Commission,
including the annual report on Form 10-K filed on February 28, 2007, and the Companys other
periodic and current reports. Wright Express Corporation undertakes no obligation to update these
forward-looking statements at any future date or dates.
4
WRIGHT EXPRESS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND
COMPREHENSIVE INCOME
(in thousands, except per share data)
(unaudited)
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Three months ended |
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Six months ended |
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June 30, |
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June 30, |
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2007 |
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2006 |
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2007 |
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2006 |
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Revenues |
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Payment processing revenue |
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$ |
66,973 |
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$ |
57,693 |
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$ |
121,167 |
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$ |
104,649 |
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Transaction processing revenue |
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3,652 |
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4,343 |
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7,127 |
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8,553 |
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Account servicing revenue |
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6,328 |
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5,926 |
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|
12,508 |
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|
11,841 |
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Finance fees |
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6,566 |
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|
5,243 |
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|
12,132 |
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|
|
10,481 |
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Other |
|
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2,454 |
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|
2,959 |
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4,861 |
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|
5,278 |
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Total revenues |
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|
85,973 |
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|
76,164 |
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|
157,795 |
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|
140,802 |
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Expenses |
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Salary and other personnel |
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|
15,699 |
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|
15,196 |
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31,828 |
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|
29,550 |
|
Service fees |
|
|
3,440 |
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|
|
3,377 |
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|
|
7,111 |
|
|
|
6,417 |
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Provision for credit losses |
|
|
3,043 |
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|
|
2,302 |
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|
|
9,306 |
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|
|
6,220 |
|
Technology leasing and support |
|
|
2,262 |
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|
|
1,934 |
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|
|
4,602 |
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|
|
3,797 |
|
Occupancy and equipment |
|
|
1,502 |
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|
|
1,703 |
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|
|
3,096 |
|
|
|
3,295 |
|
Depreciation and amortization |
|
|
3,338 |
|
|
|
2,692 |
|
|
|
6,640 |
|
|
|
5,206 |
|
Operating interest expense |
|
|
8,946 |
|
|
|
6,042 |
|
|
|
15,867 |
|
|
|
10,649 |
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Other |
|
|
5,096 |
|
|
|
4,406 |
|
|
|
9,795 |
|
|
|
8,249 |
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Total operating expenses |
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43,326 |
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|
37,652 |
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88,245 |
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73,383 |
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|
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Operating income |
|
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42,647 |
|
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|
38,512 |
|
|
|
69,550 |
|
|
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67,419 |
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Financing interest expense |
|
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(3,001 |
) |
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|
(3,666 |
) |
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|
(6,131 |
) |
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|
(7,394 |
) |
Loss on extinguishment of debt |
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(1,572 |
) |
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(1,572 |
) |
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Net realized and unrealized losses on derivative instruments |
|
|
(9,639 |
) |
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|
(20,509 |
) |
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|
(20,329 |
) |
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|
(27,987 |
) |
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Income before income taxes |
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28,435 |
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|
14,337 |
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41,518 |
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32,038 |
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Provision for income taxes |
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|
10,106 |
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|
4,481 |
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|
14,852 |
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|
|
10,832 |
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|
|
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|
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Net income |
|
|
18,329 |
|
|
|
9,856 |
|
|
|
26,666 |
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|
|
21,206 |
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|
|
|
|
|
|
|
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|
Change in net unrealized loss on available-for-sale
securities, net of tax effect of $(53) and $(48) in 2007
and $(21) and $(62) in 2006 |
|
|
(95 |
) |
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|
(55 |
) |
|
|
(87 |
) |
|
|
(118 |
) |
Change in net unrealized gain on interest rate swaps,
net of tax effect of $(42) and $(162) in 2007 and
$(49) and $37 in 2006 |
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|
(61 |
) |
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|
(20 |
) |
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|
(234 |
) |
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|
48 |
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Comprehensive income |
|
$ |
18,173 |
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$ |
9,781 |
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$ |
26,345 |
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$ |
21,136 |
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Earnings per share: |
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|
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Basic |
|
$ |
0.46 |
|
|
$ |
0.24 |
|
|
$ |
0.66 |
|
|
$ |
0.53 |
|
Diluted |
|
$ |
0.45 |
|
|
$ |
0.24 |
|
|
$ |
0.65 |
|
|
$ |
0.52 |
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|
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
39,995 |
|
|
|
40,331 |
|
|
|
40,170 |
|
|
|
40,288 |
|
Diluted |
|
|
41,084 |
|
|
|
41,086 |
|
|
|
40,853 |
|
|
|
41,035 |
|
5
WRIGHT EXPRESS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
|
|
|
|
2007 |
|
|
December 31, |
|
|
|
(unaudited) |
|
|
|
2006 |
|
|
Assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
32,937 |
|
|
$ |
35,060 |
|
Accounts receivable (less reserve for credit losses of
$9,453 in 2007 and $9,749 in 2006) |
|
|
1,134,266 |
|
|
|
802,165 |
|
Available-for-sale securities |
|
|
7,443 |
|
|
|
8,023 |
|
Property, equipment and capitalized software, net |
|
|
44,823 |
|
|
|
39,970 |
|
Deferred income taxes, net |
|
|
365,956 |
|
|
|
377,276 |
|
Intangible assets |
|
|
2,421 |
|
|
|
2,421 |
|
Goodwill |
|
|
272,861 |
|
|
|
272,861 |
|
Other assets |
|
|
18,385 |
|
|
|
13,239 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
1,879,092 |
|
|
$ |
1,551,015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders Equity |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
433,184 |
|
|
$ |
297,102 |
|
Accrued expenses |
|
|
21,831 |
|
|
|
26,065 |
|
Income taxes payable |
|
|
|
|
|
|
813 |
|
Deposits |
|
|
599,751 |
|
|
|
394,699 |
|
Borrowed federal funds |
|
|
25,350 |
|
|
|
65,396 |
|
Revolving line-of-credit facilities |
|
|
164,600 |
|
|
|
20,000 |
|
Term loan, net |
|
|
|
|
|
|
129,760 |
|
Derivative instruments, at fair value |
|
|
19,106 |
|
|
|
4,524 |
|
Other liabilities |
|
|
4,350 |
|
|
|
1,170 |
|
Amounts due to Avis under tax receivable agreement |
|
|
407,315 |
|
|
|
418,359 |
|
Preferred stock; 10,000 shares authorized: |
|
|
|
|
|
|
|
|
Series A non-voting convertible, redeemable preferred stock;
0.1 shares issued and outstanding |
|
|
10,000 |
|
|
|
10,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities |
|
|
1,685,487 |
|
|
|
1,367,888 |
|
|
|
|
|
|
|
|
|
|
Stockholders Equity |
|
|
|
|
|
|
|
|
Common stock $0.01 par value; 175,000 shares authorized,
40,668 in 2007 and 40,430 in 2006 issued |
|
|
407 |
|
|
|
404 |
|
Additional paid-in capital |
|
|
94,098 |
|
|
|
89,325 |
|
Retained earnings |
|
|
119,928 |
|
|
|
93,262 |
|
Other comprehensive income, net of tax: |
|
|
|
|
|
|
|
|
Net unrealized loss on available-for-sale securities |
|
|
(185 |
) |
|
|
(98 |
) |
Net unrealized gain on interest rate swaps |
|
|
|
|
|
|
234 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated other comprehensive income |
|
|
(185 |
) |
|
|
136 |
|
Less treasury stock at cost, 699 shares in 2007 and
no shares in 2006 |
|
|
(20,643 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders equity |
|
|
193,605 |
|
|
|
183,127 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders equity |
|
$ |
1,879,092 |
|
|
$ |
1,551,015 |
|
|
|
|
|
|
|
|
6
WRIGHT EXPRESS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
Six months ended |
|
|
|
June 30, |
|
|
|
2007 |
|
|
2006 |
|
|
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Net income |
|
$ |
26,666 |
|
|
$ |
21,206 |
|
Adjustments to reconcile net income to net cash
used for operating activities: |
|
|
|
|
|
|
|
|
Change in net unrealized loss on derivative instruments |
|
|
14,582 |
|
|
|
8,888 |
|
Stock-based compensation |
|
|
2,146 |
|
|
|
1,553 |
|
Depreciation and amortization |
|
|
7,223 |
|
|
|
5,766 |
|
Loss on extinguishment of debt |
|
|
1,572 |
|
|
|
|
|
Deferred taxes |
|
|
11,530 |
|
|
|
6,365 |
|
Provision for credit losses |
|
|
9,306 |
|
|
|
6,220 |
|
Loss on disposal and impairment of property and equipment |
|
|
|
|
|
|
5 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(341,407 |
) |
|
|
(244,945 |
) |
Other assets |
|
|
(1,995 |
) |
|
|
1,744 |
|
Accounts payable |
|
|
136,082 |
|
|
|
141,746 |
|
Accrued expenses |
|
|
(4,305 |
) |
|
|
(2,476 |
) |
Income taxes |
|
|
(4,277 |
) |
|
|
|
|
Other liabilities |
|
|
308 |
|
|
|
832 |
|
Amounts due to Avis |
|
|
(11,044 |
) |
|
|
(9,479 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used for operating activities |
|
|
(153,613 |
) |
|
|
(62,575 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
Purchases of property and equipment |
|
|
(8,621 |
) |
|
|
(6,216 |
) |
Purchases of available-for-sale securities |
|
|
(70 |
) |
|
|
(66 |
) |
Maturities of available-for-sale securities |
|
|
515 |
|
|
|
14,777 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash (used for) provided by investing activities |
|
|
(8,176 |
) |
|
|
8,495 |
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
Excess tax benefits from equity instrument share-based
payment arrangements |
|
|
1,613 |
|
|
|
251 |
|
Payments in lieu of issuing shares of common stock |
|
|
(1,152 |
) |
|
|
(682 |
) |
Proceeds from stock option exercises |
|
|
2,240 |
|
|
|
1,229 |
|
Net increase in deposits |
|
|
205,052 |
|
|
|
76,065 |
|
Net decrease in borrowed federal funds |
|
|
(40,046 |
) |
|
|
(29,677 |
) |
Net borrowings on 2007 revolving line-of-credit facility |
|
|
164,600 |
|
|
|
|
|
Loan origination fees paid for 2007 revolving line-of-credit facility |
|
|
(998 |
) |
|
|
|
|
Net repayments on 2005 revolving line-of-credit facility |
|
|
(20,000 |
) |
|
|
(5,000 |
) |
Repayments on term loan |
|
|
(131,000 |
) |
|
|
(16,500 |
) |
Purchase of shares of treasury stock |
|
|
(20,643 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by financing activities |
|
|
159,666 |
|
|
|
25,686 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in cash and cash equivalents |
|
|
(2,123 |
) |
|
|
(28,394 |
) |
Cash and cash equivalents, beginning of period |
|
|
35,060 |
|
|
|
44,994 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period |
|
$ |
32,937 |
|
|
$ |
16,600 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash flow information: |
|
|
|
|
|
|
|
|
Interest paid |
|
$ |
20,309 |
|
|
$ |
17,362 |
|
Income taxes (received) paid |
|
$ |
5,871 |
|
|
$ |
925 |
|
|
|
|
|
|
|
|
|
|
Significant non-cash transactions: |
|
|
|
|
|
|
|
|
Capitalized software licensing agreement |
|
$ |
2,872 |
|
|
$ |
|
|
7
Exhibit 1
Wright Express Corporation
Reconciliation of Adjusted Net Income to GAAP Net Income
Second Quarter 2007
(in thousands)
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
Three months ended |
|
|
|
June 30, 2007 |
|
|
June 30, 2006 |
|
Adjusted net income |
|
$ |
20,454 |
|
|
$ |
14,121 |
|
Non-cash, mark-to-market
adjustments on derivative
instruments |
|
|
(3,991 |
) |
|
|
(7,462 |
) |
Tax impact of mark to
market adjustments |
|
|
1,866 |
|
|
|
3,197 |
|
|
|
|
GAAP net income |
|
$ |
18,329 |
|
|
$ |
9,856 |
|
|
|
|
Although adjusted net income is not calculated in accordance with generally accepted accounting
principles (GAAP), this measure is integral to the Companys reporting and planning processes. The
Company considers this measure integral because it eliminates the non-cash volatility associated
with the derivative instruments. Specifically, in addition to evaluating the Companys performance
on a GAAP basis, management evaluates the Companys performance on a basis that excludes the above
items because:
|
|
|
Exclusion of the non-cash, mark-to-market adjustments on derivative instruments helps
management identify and assess trends in the Companys underlying business that might
otherwise be obscured due to quarterly non-cash earnings fluctuations associated with
fuel-price derivative contracts; and |
|
|
|
|
The non-cash, mark-to-market adjustments on derivative instruments are difficult to
forecast accurately, making comparisons across historical and future quarters difficult to
evaluate. |
For the same reasons, Wright Express believes that adjusted net income may also be useful to
investors as one means of evaluating the Companys performance. However, because adjusted net
income is a non-GAAP measure, it should not be considered as a substitute for, or superior to, net
income, operating income or cash flows from operating activities as determined in accordance with
GAAP. In addition, adjusted net income as used by Wright Express may not be comparable to
similarly titled measures employed by other companies.
Going forward, the Company will exclude the amortization of purchased intangibles from its adjusted
net income.
8
Exhibit 2
Wright Express Corporation
Selected Non Financial Metrics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q2 2007* |
|
Q1 2007* |
|
Q4 2006 |
|
Q3 2006 |
|
Q2 2006 |
Fleet Payment Processing Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payment processing transactions (000s) |
|
|
53,181 |
|
|
|
50,559 |
|
|
|
45,075 |
|
|
|
46,800 |
|
|
|
45,998 |
|
Gallons per payment processing transaction |
|
|
20.3 |
|
|
|
20.3 |
|
|
|
20.6 |
|
|
|
20.2 |
|
|
|
20.1 |
|
Payment processing gallons of fuel (000s) |
|
|
1,082,132 |
|
|
|
1,024,847 |
|
|
|
926,605 |
|
|
|
944,458 |
|
|
|
924,343 |
|
Average fuel price |
|
$ |
2.95 |
|
|
|
2.43 |
|
|
|
2.37 |
|
|
|
2.87 |
|
|
|
2.86 |
|
Payment processing $ of fuel (000s) |
|
$ |
3,196,224 |
|
|
|
2,493,781 |
|
|
|
2,194,543 |
|
|
|
2,712,120 |
|
|
|
2,642,456 |
|
Net payment processing rate |
|
|
1.93 |
% |
|
|
1.99 |
% |
|
|
2.13 |
% |
|
|
2.02 |
% |
|
|
2.03 |
% |
Fleet payment processing revenue (000s) |
|
$ |
61,777 |
|
|
|
49,607 |
|
|
|
46,647 |
|
|
|
54,841 |
|
|
|
53,590 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MasterCard Payment Processing Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MasterCard purchase volume (000s) |
|
$ |
464,425 |
|
|
|
385,153 |
|
|
|
332,934 |
|
|
|
365,739 |
|
|
|
332,706 |
|
Net interchange rate |
|
|
1.12 |
% |
|
|
1.19 |
% |
|
|
1.23 |
% |
|
|
1.21 |
% |
|
|
1.23 |
% |
MasterCard payment processing revenue (000s) |
|
$ |
5,197 |
|
|
|
4,587 |
|
|
|
4,089 |
|
|
|
4,416 |
|
|
|
4,105 |
|
Definitions:
Payment processing transactions represents the total number of purchases made by fleets that have a
payment processing relationship with Wright Express.
Payment processing gallons of fuel represents the total number of gallons of fuel purchased by
fleets that have a payment processing relationship with Wright Express.
Payment processing $ of fuel represents the total dollar value of the fuel purchased by fleets that
have a payment processing relationship with Wright Express.
Net payment processing rate represents the percentage of the dollar value of each payment
processing transaction that Wright Express records as revenue from merchants less any discounts
given to fleets or strategic relationships.
MasterCard purchase volume represents the total dollar value of all transactions that use a Wright
Express MasterCard branded product.
Net interchange rate represents the percentage of the dollar value of each MasterCard transaction
that Wright Express records as revenue less any discounts given to customers.
|
|
|
* |
|
2007 results are affected by the conversion of the ExxonMobil portfolio to a payment processing
relationship. |
9
EX-99.2
3
b66410wcexv99w2.htm
EX-99.2 PRESS RELEASE DATED AUGUST 7, 2007
exv99w2
Exhibit 99.2
|
|
|
News media contact:
|
|
Investor contact: |
Jessica Roy
|
|
Steve Elder |
Wright Express
|
|
Wright Express |
207.523.6763
|
|
207.523.7769 |
Jessica_Roy@wrightexpress.com
|
|
Steve_Elder@wrightexpress.com |
Wright Express Adds Fuel Inventory Solution with Acquisition of
TelaPoint
Transaction Expands Services Offered to Merchants, Distributors and Fleets
In Conjunction with Announcement of Second-Quarter Financial Results, Wright Express
to Discuss Transaction on Conference Call at 9:00 a.m. ET
SOUTH PORTLAND, MAINE August 7, 2007 Wright Express Corporation (NYSE: WXS) today
announced that it has acquired privately held TelaPoint, Inc. for approximately $40 million in
cash, financed through the Companys existing credit facility. TelaPoint is a leading provider of
browser-based supply chain software solutions for petroleum distributors and fuel retailers.
Founded in 1999 and based in Louisville, Kentucky,
TelaPoint was the first browser-based software
company to provide business-to-business applications focused exclusively on information solutions
for oil companies and the petroleum distributor market. The TelaPoint application suite enables
convenience stores and fuel outlets to improve the efficiency of their fuel replenishment, buying
and administrative operations.
Operating on a software-as-a-service business model, TelaPoint generates the majority of its
revenue on a recurring basis from monthly site fees, which creates strong visibility into future revenues. TelaPoints customers include more than
20,000 retail and wholesale fueling sites across the country, and the company has relationships
with approximately 250 petroleum carriers.
TelaPoint is a rapidly growing and profitable business. Revenues
for 2008 are forecasted to be approximately $8 million. Wright Express expects the acquisition to
be slightly accretive, excluding the amortization of purchased intangibles, in the first 12 months
of combined operations and have no impact on the Companys margins.
Management Comments
TelaPoint
is an excellent strategic fit for Wright Express an innovative company that provides
us with a new product we can sell into markets we know well, said Michael Dubyak, president and
chief executive officer of Wright Express. TelaPoints browser-based application suite will
broaden and strengthen our portfolio of information solutions, offering us potential to diversify
our revenues. At the same time, we expect TelaPoints products to further secure our position with
merchants, distributors and fleets by adding value to their relationships with Wright Express.
Michael Dahlem, chief executive
officer of TelaPoint said, We are delighted to be part of the
Wright Express organization. We believe that our combined product offerings will create added
value for the customers of both companies.
TelaPoint will operate as a standalone company and remain headquartered at its existing facility
in Louisville, said Dubyak. TelaPoint has a talented workforce and management team. We expect
the TelaPoint organization to maintain its record of strong growth and play a key role as we
continue to diversify our revenue stream.
Conference Call Details
Wright Express will host a conference call today, August 7, 2007, at 9:00 a.m. (ET) to discuss the
Companys second-quarter 2007 financial results and the TelaPoint acquisition. A live webcast of
this conference call will be available at the Investor Relations section of the Companys website
(www.wrightexpress.com). The live conference call can also be accessed by dialing (800) 479-1628
or (719) 457-2729. A replay of the webcast will be available on the Companys website for
approximately three months.
About Wright Express
Wright Express is a leading provider of payment processing and information management services to
the U.S. commercial and government vehicle fleet industry. Wright Express provides these services
for approximately 295,000 commercial and government fleets containing 4.4 million vehicles. Wright
Express markets these services directly as well as through more than 125 strategic relationships,
and offers a MasterCard-branded corporate card. The Company employs more than 675 people and
maintains its headquarters in South Portland, Maine. For more information about Wright Express,
please visit www.wrightexpress.com.
This press release contains forward-looking statements, including statements regarding Wright
Express Corporations: expectation that TelaPoint is a rapidly growing and profitable business;
forecasted revenues for TelaPoint in 2008; expectation that the acquisition will be slightly
accretive excluding the amortization of purchased intangibles, in the first 12 months of combined
operations and have no impact on Wright Express margins; expectation that TelaPoints
browser-based application suite will broaden and strengthen its portfolio of information solutions
and potentially diversify revenues; expectation that TelaPoints products secure Wright Express
position with merchants, distributors and fleets by adding value to their relationships with Wright
Express.
These forward-looking statements include a number of risks and uncertainties that could cause
actual results to differ materially. These risks and uncertainties include: volatility in fuel
prices; third-quarter and full-year 2007 fueling patterns; the effect of the Companys
fuel-price-related derivative instruments; effects of competition; the potential loss of key
strategic relationships; decreased demand for fuel and other vehicle products and services and the
effects of general economic conditions on the commercial activity of
fleets; the Companys ability
to rapidly implement new technology and systems; potential corporate transactions including
alliances, mergers, acquisitions and divestitures; the risks associated with the integration and
profitability of
TelaPoint, Inc.s operations; changes in interest rates and the other risks and uncertainties
included from time to time in the Companys filings with the Securities and Exchange Commission,
including the annual report on Form 10-K filed on February 28, 2007, and the Companys other
periodic and current reports. Wright Express Corporation undertakes no obligation to update these
forward-looking statements at any future date or dates.
GRAPHIC
4
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