☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 01-0526993 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
97 Darling Avenue, South Portland, Maine | 04106 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | ☒ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☐ (Do not check if a smaller reporting company) | Smaller reporting company | ☐ |
Class | Outstanding at August 4, 2016 | |
Common Stock, $0.01 par value per share | 42,720,344 shares |
Page | ||
PART I-FINANCIAL INFORMATION | ||
Item 1. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
PART II-OTHER INFORMATION | ||
Item 1. | ||
Item 1A. | ||
Item 2. | ||
Item 6. | ||
June 30, 2016 | December 31, 2015 | ||||||
Assets | |||||||
Cash and cash equivalents | $ | 317,847 | $ | 279,989 | |||
Accounts receivable (less reserve for credit losses of $13,064 in 2016 and $13,832 in 2015) | 1,886,744 | 1,508,605 | |||||
Securitized accounts receivable, restricted | 87,241 | 87,724 | |||||
Income taxes receivable | 11,006 | — | |||||
Available-for-sale securities | 24,405 | 18,562 | |||||
Fuel price derivatives, at fair value | — | 5,007 | |||||
Property, equipment and capitalized software (net of accumulated depreciation of $212,060 in 2016 and $192,140 in 2015) | 150,276 | 138,585 | |||||
Deferred income taxes, net | 7,518 | 10,303 | |||||
Goodwill | 1,119,048 | 1,112,878 | |||||
Other intangible assets, net | 448,685 | 470,712 | |||||
Other assets | 209,651 | 215,544 | |||||
Total assets | $ | 4,262,421 | $ | 3,847,909 | |||
Liabilities and Stockholders’ Equity | |||||||
Accounts payable | $ | 553,522 | $ | 378,811 | |||
Accrued expenses | 215,480 | 156,180 | |||||
Income taxes payable | — | 2,732 | |||||
Deposits | 937,707 | 870,518 | |||||
Securitized debt | 73,327 | 82,018 | |||||
Revolving line-of-credit facilities and term loan, net | 727,639 | 664,918 | |||||
Deferred income taxes, net | 95,360 | 83,912 | |||||
Notes outstanding, net | 395,167 | 394,800 | |||||
Other debt | 62,149 | 50,046 | |||||
Amounts due under tax receivable agreement | 52,173 | 57,537 | |||||
Other liabilities | 13,146 | 10,756 | |||||
Total liabilities | 3,125,670 | 2,752,228 | |||||
Commitments and contingencies (Note 14) | |||||||
Stockholders’ Equity | |||||||
Common stock $0.01 par value; 175,000 shares authorized; 43,146 shares issued in 2016 and 43,079 in 2015; 38,814 shares outstanding in 2016 and 38,746 in 2015 | 431 | 431 | |||||
Additional paid-in capital | 181,343 | 174,972 | |||||
Non-controlling interest | 12,052 | 12,437 | |||||
Retained earnings | 1,219,287 | 1,183,634 | |||||
Accumulated other comprehensive income | (104,020 | ) | (103,451 | ) | |||
Less treasury stock at cost; 4,428 shares in 2016 and 2015 | (172,342 | ) | (172,342 | ) | |||
Total stockholders’ equity | 1,136,751 | 1,095,681 | |||||
Total liabilities and stockholders’ equity | $ | 4,262,421 | $ | 3,847,909 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Revenues | |||||||||||||||
Payment processing revenue | $ | 126,080 | $ | 128,081 | $ | 237,136 | $ | 245,516 | |||||||
Account servicing revenue | 47,433 | 38,474 | 91,955 | 75,422 | |||||||||||
Finance fee revenue | 32,704 | 20,401 | 56,210 | 40,592 | |||||||||||
Other revenue | 27,719 | 26,697 | 54,563 | 54,408 | |||||||||||
Total revenues | 233,936 | 213,653 | 439,864 | 415,938 | |||||||||||
Expenses | |||||||||||||||
Salary and other personnel | 66,662 | 59,091 | 130,072 | 117,508 | |||||||||||
Restructuring | 3,506 | — | 5,095 | 8,559 | |||||||||||
Service fees | 45,924 | 33,941 | 82,683 | 64,011 | |||||||||||
Provision for credit losses | 6,443 | 3,983 | 10,360 | 7,897 | |||||||||||
Technology leasing and support | 10,932 | 10,021 | 22,008 | 19,455 | |||||||||||
Occupancy and equipment | 6,113 | 5,034 | 11,825 | 10,031 | |||||||||||
Depreciation and amortization | 23,109 | 20,759 | 45,373 | 42,146 | |||||||||||
Operating interest expense | 1,505 | 1,357 | 2,891 | 2,936 | |||||||||||
Cost of hardware and equipment sold | 665 | 684 | 1,570 | 1,793 | |||||||||||
Other | 17,442 | 15,865 | 35,225 | 31,659 | |||||||||||
Gain on divestiture | — | — | — | (1,215 | ) | ||||||||||
Total operating expenses | 182,301 | 150,735 | 347,102 | 304,780 | |||||||||||
Operating income | 51,635 | 62,918 | 92,762 | 111,158 | |||||||||||
Financing interest expense | (30,418 | ) | (11,916 | ) | (51,976 | ) | (24,004 | ) | |||||||
Net foreign currency (loss) gain | (4,823 | ) | (2,161 | ) | 11,301 | (6,537 | ) | ||||||||
Net realized and unrealized (loss) gain on fuel price derivative instruments | — | (6,000 | ) | 711 | (3,251 | ) | |||||||||
Income before income taxes | 16,394 | 42,841 | 52,798 | 77,366 | |||||||||||
Income taxes | 4,482 | 16,441 | 17,665 | 30,933 | |||||||||||
Net income | 11,912 | 26,400 | 35,133 | 46,433 | |||||||||||
Less: Net loss attributable to non-controlling interests | (655 | ) | (92 | ) | (520 | ) | (2,404 | ) | |||||||
Net earnings attributable to WEX Inc. | $ | 12,567 | $ | 26,492 | $ | 35,653 | $ | 48,837 | |||||||
Net earnings attributable to WEX Inc. per share: | |||||||||||||||
Basic | $ | 0.32 | $ | 0.68 | $ | 0.92 | $ | 1.26 | |||||||
Diluted | $ | 0.32 | $ | 0.68 | $ | 0.92 | $ | 1.26 | |||||||
Weighted average common shares outstanding: | |||||||||||||||
Basic | 38,806 | 38,739 | 38,781 | 38,798 | |||||||||||
Diluted | 38,857 | 38,799 | 38,850 | 38,880 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Net income | $ | 11,912 | $ | 26,400 | $ | 35,133 | $ | 46,433 | |||||||
Changes in available-for-sale securities, net of tax effect of $63 and $(82) for the three months ended June 30, 2016 and 2015 and $160 and $(29) for the six months ended June 30, 2016 and 2015 | 107 | (140 | ) | 271 | (49 | ) | |||||||||
Foreign currency translation | (11,479 | ) | 8,749 | (705 | ) | (20,317 | ) | ||||||||
Comprehensive income | 540 | 35,009 | 34,699 | 26,067 | |||||||||||
Less: comprehensive (loss) income attributable to non-controlling interests | (976 | ) | 866 | (385 | ) | (5,829 | ) | ||||||||
Comprehensive income attributable to WEX Inc. | $ | 1,516 | $ | 34,143 | $ | 35,084 | $ | 31,896 |
Common Stock | ||||||||||||||||||||||||||||||
Shares | Amount at par | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Retained Earnings | Non-controlling interest in subsidiaries | Total Stockholders’ Equity | |||||||||||||||||||||||
Balance at December 31, 2014 | 38,897 | $ | 430 | $ | 179,077 | $ | (50,581 | ) | $ | (150,331 | ) | $ | 1,081,730 | $ | 17,396 | $ | 1,077,721 | |||||||||||||
Stock issued upon exercise of stock options | 2 | — | 24 | — | — | — | — | 24 | ||||||||||||||||||||||
Tax expense from stock option and restricted stock units | — | — | (234 | ) | — | — | — | — | (234 | ) | ||||||||||||||||||||
Stock issued upon vesting of restricted and deferred stock units | 56 | 1 | (1 | ) | — | — | — | — | — | |||||||||||||||||||||
Stock-based compensation, net of share repurchases for tax withholdings | — | — | 4,789 | — | — | — | — | 4,789 | ||||||||||||||||||||||
Purchase of shares of treasury stock | (210 | ) | — | — | — | (22,011 | ) | — | — | (22,011 | ) | |||||||||||||||||||
Changes in available-for-sale securities, net of tax effect of $(29) | — | — | — | (49 | ) | — | — | — | (49 | ) | ||||||||||||||||||||
Foreign currency translation | — | — | — | (16,892 | ) | — | — | (1,168 | ) | (18,060 | ) | |||||||||||||||||||
Net income (loss) | — | — | — | — | — | 48,837 | (3,063 | ) | 45,774 | |||||||||||||||||||||
Balance at June 30, 2015 | 38,745 | $ | 431 | $ | 183,655 | $ | (67,522 | ) | $ | (172,342 | ) | $ | 1,130,567 | $ | 13,165 | $ | 1,087,954 | |||||||||||||
Balance at December 31, 2015 | 38,746 | $ | 431 | $ | 174,972 | $ | (103,451 | ) | $ | (172,342 | ) | $ | 1,183,634 | $ | 12,437 | $ | 1,095,681 | |||||||||||||
Stock issued upon exercise of stock options | 7 | — | 93 | — | — | — | — | 93 | ||||||||||||||||||||||
Tax expense from stock option and restricted stock units | — | — | (692 | ) | — | — | — | — | (692 | ) | ||||||||||||||||||||
Stock issued upon vesting of restricted and deferred stock units | 61 | — | — | — | — | — | — | — | ||||||||||||||||||||||
Stock-based compensation, net of share repurchases for tax withholdings | — | — | 6,970 | — | — | — | — | 6,970 | ||||||||||||||||||||||
Changes in available-for-sale securities, net of tax effect of $160 | — | — | — | 271 | — | — | — | 271 | ||||||||||||||||||||||
Foreign currency translation | — | — | — | (840 | ) | — | — | 135 | (705 | ) | ||||||||||||||||||||
Net income (loss) | — | — | — | — | — | 35,653 | (520 | ) | 35,133 | |||||||||||||||||||||
Balance at June 30, 2016 | 38,814 | $ | 431 | $ | 181,343 | $ | (104,020 | ) | $ | (172,342 | ) | $ | 1,219,287 | $ | 12,052 | $ | 1,136,751 |
Six months ended June 30, | |||||||
2016 | 2015 | ||||||
Cash flows from operating activities | |||||||
Net income | $ | 35,133 | $ | 46,433 | |||
Adjustments to reconcile net income to net cash provided by (used for) operating activities: | |||||||
Net unrealized (gain) loss | (14,783 | ) | 48,761 | ||||
Stock-based compensation | 9,113 | 7,160 | |||||
Depreciation, amortization and impairment | 46,916 | 43,687 | |||||
Gain on divestiture | — | (1,215 | ) | ||||
Deferred taxes | 15,251 | 9,026 | |||||
Restructuring charge | 2,969 | 8,567 | |||||
Provision for credit losses | 10,360 | 7,897 | |||||
Loss on disposal of property, equipment and capitalized software | 38 | 119 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (383,831 | ) | (244,537 | ) | |||
Other assets | 12,166 | (32,769 | ) | ||||
Accounts payable | 166,850 | 177,671 | |||||
Accrued expenses | 61,057 | (19,133 | ) | ||||
Income taxes | (15,059 | ) | 10,130 | ||||
Other liabilities | 2,408 | (3,661 | ) | ||||
Amounts due under tax receivable agreement | (5,364 | ) | (5,121 | ) | |||
Net cash (used for) provided by operating activities | (56,776 | ) | 53,015 | ||||
Cash flows from investing activities | |||||||
Purchases of property, equipment and capitalized software | (35,742 | ) | (27,701 | ) | |||
Purchases of available-for-sale securities | (5,596 | ) | (174 | ) | |||
Maturities of available-for-sale securities | 183 | 364 | |||||
Proceeds from divestiture | — | 17,265 | |||||
Net cash used for investing activities | (41,155 | ) | (10,246 | ) | |||
Cash flows from financing activities | |||||||
Excess tax benefits from equity instrument share-based payment arrangements | — | 653 | |||||
Repurchase of share-based awards to satisfy tax withholdings | (2,143 | ) | (2,371 | ) | |||
Proceeds from stock option exercises | 93 | 24 | |||||
Net change in deposits | 66,994 | (73,079 | ) | ||||
Net change in borrowed federal funds | — | 50,500 | |||||
Other debt | 10,845 | (482 | ) | ||||
Net activity on 2014 revolving credit facility, net of debt issuance costs | 76,754 | (168,829 | ) | ||||
Net activity on term loan, net of debt issuance costs | (13,750 | ) | (13,750 | ) | |||
Net change in securitized debt | (10,154 | ) | 90,382 | ||||
Purchase of shares of treasury stock | — | (22,011 | ) | ||||
Net cash provided by (used for) financing activities | 128,639 | (138,963 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | 7,150 | (4,237 | ) | ||||
Net change in cash and cash equivalents | 37,858 | (100,431 | ) | ||||
Cash and cash equivalents, beginning of period | 279,989 | 284,763 | |||||
Cash and cash equivalents, end of period | $ | 317,847 | $ | 184,332 | |||
Supplemental cash flow information | |||||||
Interest paid | $ | 23,300 | $ | 25,391 | |||
Income taxes paid | $ | 17,295 | $ | 11,309 |
1. | Basis of Presentation |
2011 Credit Agreement | Credit agreement entered into on May 23, 2011 among the Company, as borrower, WEX Card Holdings Australia Pty Ltd, a wholly-owned subsidiary of the Company, as specified designated borrower, Bank of America, N.A., as administrative agent and letter of credit issuer, and the other lenders party thereto | |
2013 Credit Agreement | Amended and restated credit agreement entered into on January 18, 2013 by and among the Company and certain of our subsidiaries, as borrowers, and WEX Card Holdings Australia Pty Ltd, as specified designated borrower, with a lending syndicate | |
2014 Amendment Agreement | Amendment and restatement agreement entered into on August 22, 2014, among the Company, the lenders party thereto, and Bank of America, N.A., as administrative agent | |
2014 Credit Agreement | Second amended and restated credit agreement entered into on August 22, 2014, by and among the Company and certain of our subsidiaries, as borrowers, WEX Card Holding Australia Pty Ltd., as designated borrower, and Bank of America, N.A., as administrative agent on behalf of consenting lenders | |
2016 Credit Agreement | Credit agreement entered into on July 1, 2016 by and among the Company and certain of our subsidiaries, as borrowers, WEX Card Holding Australia Pty Ltd., as designated borrower, and Bank of America, N.A., as administrative agent on behalf of the lenders | |
Adjusted Net Income or ANI | A non-GAAP metric that adjusts net earnings attributable to WEX Inc. to exclude fair value changes of fuel-price related derivative instruments, the amortization of purchased intangibles, the impact of net foreign currency remeasurement gains and losses, the expense associated with stock-based compensation, acquisition related expenses and adjustments, the net impact of tax rate changes on the Company’s deferred tax asset and related changes in the tax-receivable agreement, deferred loan costs associated with the extinguishment of debt, certain non-cash asset impairment charges, restructuring charges, ticking fees, gains on the extinguishment of a portion of the tax receivable agreement, regulatory reserves, gains or losses on divestitures and adjustments attributable to non-controlling interests, including adjustments to the redemption value of a non-controlling interest, certain discrete tax items, as well as the related tax impacts of the adjustments | |
ASU 2014-09 | Accounting Standards Update No. 2014-09 Revenue from Contracts with Customers (Topic 606) | |
ASU 2015-03 | Accounting Standards Update No. 2015-03 Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs | |
ASU 2015-16 | Accounting Standards Update No. 2015-16 Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments | |
ASU 2016-01 | Accounting Standards Update No. 2016-01 Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities | |
ASU 2016-02 | Accounting Standards Update No. 2016-02 Leases (Topic 842) | |
ASU 2016-08 | Accounting Standards Update No. 2016-08 Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) | |
ASU 2016-09 | Accounting Standards Update No. 2016-09 Compensation-Stock Compensation (Topical 718): Improvements to Employee Share-Based Payment Accounting | |
ASU 2016-10 | Accounting Standards Update No. 2016-10 Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing | |
ASU 2016-12 | Accounting Standards Update No. 2016-12 Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients | |
ASU 2016-13 | Accounting Standards Update No. 2016-13 Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments | |
Australian Securitization Subsidiary | Southern Cross WEX 2015-1 Trust, a bankruptcy-remote subsidiary consolidated by the Company | |
Average expenditure per payment processing transaction | Average total dollars of spend in a funded fuel transaction | |
Benaissance | Benaissance, a leading provider of integrated SaaS technologies and services for healthcare premium billing, payment and workflow management, acquired by the Company on November 18, 2015 | |
Company | WEX Inc. and all entities included in the unaudited condensed consolidated financial statements |
EFS | Electronic Funds Source LLC, a provider of customized corporate payment solutions for fleet and corporate customers with a focus on the large and mid-sized over-the-road fleet segments, acquired by the Company on July 1, 2016 | |
Esso portfolio in Europe | European commercial fleet card portfolio acquired from ExxonMobil | |
European Securitization Subsidiary | Gorham Trade Finance B.V., a bankruptcy-remote subsidiary consolidated by the Company | |
Evolution1 | EB Holdings Corp. and its subsidiaries which includes Evolution1, Inc., acquired by the Company on July 16, 2014 | |
FASB | Financial Accounting Standards Board | |
FX | Foreign exchange | |
GAAP | Generally Accepted Accounting Principles in the United States | |
Indenture | The Notes were issued pursuant to an indenture dated as of January 30, 2013 among the Company, the guarantors listed therein, and The Bank of New York Mellon Trust Company, N.A., as trustee | |
NCI | Non-controlling interest | |
NOL | Net operating loss | |
Notes | $400 million notes with a 4.75% fixed rate, issued on January 30, 2013 | |
NOW deposits | Negotiable order of withdrawal deposits | |
Over-the-road | Typically heavy trucks traveling long distances | |
Payment solutions purchase volume | Total amount paid by customers for transactions | |
Payment processing transactions | Funded payment transactions where the Company maintains the receivable for total purchase | |
PPG | Price per gallon of fuel | |
rapid! PayCard | rapid! PayCard, previously a line of business of the Company, sold on January 7, 2015 | |
SaaS | Software-as-a-service | |
SEC | Securities and Exchange Commission | |
Ticking fees | A fee incurred by a borrower to compensate the lender to delay a financing arrangement and hold a commitment of funds for the borrower for a period of time | |
Total fleet transactions | Total of transaction processing and payment processing transactions | |
Transaction processing transactions | Unfunded payment transactions where the Company is the processor and only has receivables for the processing fee | |
UNIK | UNIK S.A., the Company's Brazilian subsidiary | |
WEX | WEX Inc. | |
WEX Europe Services | Consists primarily of our European commercial fleet card portfolio acquired by the Company from ExxonMobil on December 1, 2014 | |
WEX Health | Evolution1 and Benaissance, collectively |
Previously Reported | Effect of Accounting Principle Adoption | Adjusted | |||||||||
Unaudited condensed consolidated balance sheet | |||||||||||
Other assets | $ | 225,581 | $ | (10,037 | ) | $ | 215,544 | ||||
Total assets | $ | 3,857,946 | $ | (10,037 | ) | $ | 3,847,909 | ||||
Revolving line-of-credit facilities and term loan, net | $ | 669,755 | $ | (4,837 | ) | $ | 664,918 | ||||
Notes outstanding, net | $ | 400,000 | $ | (5,200 | ) | $ | 394,800 | ||||
Total liabilities | $ | 2,762,265 | $ | (10,037 | ) | $ | 2,752,228 | ||||
Total liabilities and stockholders’ equity | $ | 3,857,946 | $ | (10,037 | ) | $ | 3,847,909 |
2. | New Accounting Standards |
3. | Business Acquisitions |
Consideration paid (net of cash acquired) | $ | 80,677 | |
Less: | |||
Accounts receivable | 1,594 | ||
Other tangible assets and liabilities, net | 314 | ||
Acquired software and developed technology(a) | 10,300 | ||
Customer relationships(b) | 27,700 | ||
Trade name(c) | 1,500 | ||
Recorded goodwill | $ | 39,269 |
(a) | Weighted average life – 5.0 years. |
(b) | Weighted average life – 7.6 years. |
(c) | Weighted average life – 8.1 years. |
4. | Sale of Subsidiary and Assets |
5. | Reserves for Credit Losses |
Six months ended June 30, | |||||||
2016 | 2015 | ||||||
Balance, beginning of period | $ | 13,832 | $ | 13,919 | |||
Provision for credit losses | 10,360 | 7,897 | |||||
Charge-offs | (13,681 | ) | (15,019 | ) | |||
Recoveries of amounts previously charged-off | 2,476 | 2,931 | |||||
Currency translation | 77 | (63 | ) | ||||
Balance, end of period | $ | 13,064 | $ | 9,665 |
6. | Goodwill and Other Intangible Assets |
Fleet Solutions Segment | Travel and Corporate Solutions Segment | Health and Employee Benefit Solutions Segment | Total | ||||||||||||
Gross goodwill, January 1, 2016 | $ | 736,240 | $ | 43,825 | $ | 350,321 | $ | 1,130,386 | |||||||
Impact of foreign currency translation | 4,285 | (1,712 | ) | 3,095 | 5,668 | ||||||||||
Acquisition adjustments | — | — | 502 | 502 | |||||||||||
Gross goodwill, June 30, 2016 | 740,525 | 42,113 | 353,918 | 1,136,556 | |||||||||||
Accumulated impairment, June 30, 2016 | (1,337 | ) | (16,171 | ) | — | (17,508 | ) | ||||||||
Net goodwill, June 30, 2016 | $ | 739,188 | $ | 25,942 | $ | 353,918 | $ | 1,119,048 |
Net Carrying Amount, January 1, 2016 | Amortization | Disposals | Impact of foreign currency translation | Net Carrying Amount, June 30, 2016 | |||||||||||||||
Definite-lived intangible assets | |||||||||||||||||||
Acquired software and developed technology | $ | 114,012 | $ | (6,367 | ) | $ | — | $ | 520 | $ | 108,165 | ||||||||
Customer relationships | 297,904 | (15,544 | ) | — | 2,050 | 284,410 | |||||||||||||
Licensing agreements | 27,398 | (2,549 | ) | — | 521 | 25,370 | |||||||||||||
Patent | 878 | (98 | ) | — | 7 | 787 | |||||||||||||
Trademarks and trade names | 13,144 | (654 | ) | — | 2 | 12,492 | |||||||||||||
Indefinite-lived intangible assets | |||||||||||||||||||
Trademarks and trade names | 17,376 | — | — | 85 | 17,461 | ||||||||||||||
Total | $ | 470,712 | $ | (25,212 | ) | $ | — | $ | 3,185 | $ | 448,685 |
Remaining 2016 | $ | 25,404 | |
2017 | $ | 51,191 | |
2018 | $ | 47,232 | |
2019 | $ | 43,416 | |
2020 | $ | 39,939 | |
2021 | $ | 35,890 |
June 30, 2016 | December 31, 2015 | ||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||
Definite-lived intangible assets | |||||||||||||||||||||||
Acquired software and developed technology | $ | 156,285 | $ | (48,120 | ) | $ | 108,165 | $ | 155,182 | $ | (41,170 | ) | $ | 114,012 | |||||||||
Customer relationships | 407,402 | (122,992 | ) | 284,410 | 403,382 | (105,478 | ) | 297,904 | |||||||||||||||
Licensing agreements | 32,482 | (7,112 | ) | 25,370 | 31,903 | (4,505 | ) | 27,398 | |||||||||||||||
Patent | 2,461 | (1,674 | ) | 787 | 2,413 | (1,535 | ) | 878 | |||||||||||||||
Trademarks and trade names | 16,430 | (3,938 | ) | 12,492 | 16,410 | (3,266 | ) | 13,144 | |||||||||||||||
$ | 615,060 | $ | (183,836 | ) | 431,224 | $ | 609,290 | $ | (155,954 | ) | 453,336 | ||||||||||||
Indefinite-lived intangible assets | |||||||||||||||||||||||
Trademarks and trade names | 17,461 | 17,376 | |||||||||||||||||||||
Total | $ | 448,685 | $ | 470,712 |
7. | Earnings per Share |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Net earnings attributable to WEX Inc. available for common stockholders – Basic and Diluted | $ | 12,567 | $ | 26,492 | $ | 35,653 | $ | 48,837 | |||||||
Weighted average common shares outstanding – Basic | 38,806 | 38,739 | 38,781 | 38,798 | |||||||||||
Unvested restricted stock units | 36 | 43 | 54 | 65 | |||||||||||
Stock options | 15 | 17 | 15 | 17 | |||||||||||
Weighted average common shares outstanding – Diluted | 38,857 | 38,799 | 38,850 | 38,880 |
8. | Derivative Instruments |
Amount of Gain or (Loss) Recognized in Income on Derivative | |||||||||||||||||
Derivatives Not Designated as Hedging Instruments | Location of Gain or (Loss) Recognized in | Three months ended June 30, | Six months ended June 30, | ||||||||||||||
Income on Derivative | 2016 | 2015 | 2016 | 2015 | |||||||||||||
Commodity contracts | Net realized and unrealized (loss) gain on fuel price derivatives | $ | — | $ | (6,000 | ) | $ | 711 | $ | (3,251 | ) | ||||||
Foreign currency contracts | Net foreign currency gain (loss) | $ | 73 | $ | (5,838 | ) | 39 | $ | 21,967 |
Derivatives Classified as Assets | Derivatives Classified as Liabilities | |||||||||||
December 31, 2015 | December 31, 2015 | |||||||||||
Derivatives Not Designated as Hedging Instruments | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | ||||||||
Commodity contracts | Fuel price derivatives, at fair value | $ | 5,007 | Fuel price derivatives, at fair value | $ | — | ||||||
Foreign currency contracts | Accounts receivable | $ | — | Accounts payable | $ | 90 |
9. | Financing and Other Debt |
June 30, 2016 | December 31, 2015 | ||||||
Revolving line of credit facilities and term loan | $ | 3,661 | $ | 4,837 | |||
Notes outstanding | $ | 4,833 | $ | 5,200 |
10. | Fair Value |
• | Level 1 – Quoted prices for identical instruments in active markets. |
• | Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. |
• | Level 3 – Instruments whose significant value drivers are unobservable. |
Fair Value Measurements at Reporting Date Using | |||||||||||||||
June 30, 2016 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
Assets: | |||||||||||||||
Mortgage-backed securities | $ | 629 | $ | — | $ | 629 | $ | — | |||||||
Asset-backed securities | 736 | — | 736 | — | |||||||||||
Municipal bonds | 793 | — | 793 | — | |||||||||||
Equity securities | 22,247 | 22,247 | — | — | |||||||||||
Total available-for-sale securities | $ | 24,405 | $ | 22,247 | $ | 2,158 | $ | — | |||||||
Executive deferred compensation plan trust (a) | $ | 5,514 | $ | 5,514 | $ | — | $ | — |
(a) | The fair value of these instruments is recorded in Other assets. |
Fair Value Measurements at Reporting Date Using | |||||||||||||||
December 31, 2015 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
Assets: | |||||||||||||||
Mortgage-backed securities | $ | 650 | $ | — | $ | 650 | $ | — | |||||||
Asset-backed securities | 848 | — | 848 | — | |||||||||||
Municipal bonds | 398 | — | 398 | — | |||||||||||
Equity securities | 16,666 | 16,666 | — | — | |||||||||||
Total available-for-sale securities | $ | 18,562 | $ | 16,666 | $ | 1,896 | $ | — | |||||||
Executive deferred compensation plan trust (a) | $ | 5,655 | $ | 5,655 | $ | — | $ | — | |||||||
Fuel price derivatives – unleaded fuel (b) | $ | 3,083 | $ | — | $ | 3,083 | $ | — | |||||||
Fuel price derivatives – diesel (b) | 1,924 | — | — | 1,924 | |||||||||||
Total fuel price derivatives | $ | 5,007 | $ | — | $ | 3,083 | $ | 1,924 | |||||||
Liabilities: | |||||||||||||||
Foreign currency swaps (c) | $ | 90 | $ | — | $ | 90 | $ | — |
(a) | The fair value of these instruments is recorded in Other assets. |
(b) | The balance sheet presentation combines unleaded fuel and diesel fuel positions. |
(c) | The fair value of these instruments is recorded in Accounts payable. |
Fuel Price Derivatives – Diesel | ||||
Beginning balance | $ | 10,261 | ||
Total gains and (losses) – realized/unrealized | ||||
Included in earnings (a) | (4,183 | ) | ||
Included in other comprehensive income | — | |||
Purchases, issuances and settlements | — | |||
Transfers (in)/out of Level 3 | — | |||
Ending balance | $ | 6,078 |
(a) | Gains and losses (realized and unrealized) associated with fuel price derivatives, included in earnings for the three months ended June 30, 2015, are reported in net realized and unrealized losses on fuel price derivatives on the unaudited condensed consolidated statements of income. |
June 30, 2016 | June 30, 2015 | |||||||
Fuel Price Derivatives – Diesel | Fuel Price Derivatives – Diesel | |||||||
Beginning balance | $ | 1,924 | $ | 11,848 | ||||
Total (losses) and gains – realized/unrealized | ||||||||
Included in earnings (a) | (1,924 | ) | (5,770 | ) | ||||
Included in other comprehensive income | — | — | ||||||
Purchases, issuances and settlements | — | — | ||||||
Transfers (in)/out of Level 3 | — | — | ||||||
Ending balance | $ | — | $ | 6,078 |
(a) | Gains and losses (realized and unrealized) associated with fuel price derivatives, included in earnings for the six months ended June 30, 2016 and 2015, are reported in net realized and unrealized losses on fuel price derivatives on the unaudited condensed consolidated statements of income. |
11. | Accumulated Other Comprehensive Income (Loss) |
2016 | 2015 | ||||||||||||||
Unrealized Gains and Losses on Available- for-Sale Securities | Foreign Currency Items | Unrealized Gains and Losses on Available- for-Sale Securities | Foreign Currency Items | ||||||||||||
Beginning balance | $ | (48 | ) | $ | (92,921 | ) | $ | (38 | ) | $ | (75,135 | ) | |||
Other comprehensive income (loss) | 107 | (11,158 | ) | (140 | ) | 7,791 | |||||||||
Ending balance | $ | 59 | $ | (104,079 | ) | $ | (178 | ) | $ | (67,344 | ) |
2016 | 2015 | ||||||||||||||
Unrealized Gains and Losses on Available- for-Sale Securities | Foreign Currency Items | Unrealized Gains and Losses on Available- for-Sale Securities | Foreign Currency Items | ||||||||||||
Beginning balance | $ | (212 | ) | $ | (103,239 | ) | $ | (129 | ) | $ | (50,452 | ) | |||
Other comprehensive income (loss) | 271 | (840 | ) | (49 | ) | (16,892 | ) | ||||||||
Ending balance | $ | 59 | $ | (104,079 | ) | $ | (178 | ) | $ | (67,344 | ) |
12. | Non-controlling Interests |
Three months ended June 30, 2015 | Six months ended June 30, 2015 | ||||||
Balance, beginning of period | $ | 13,647 | $ | 16,590 | |||
Net income attributable to redeemable non-controlling interest | 670 | 659 | |||||
Currency translation adjustment | 675 | (2,257 | ) | ||||
Ending balance | $ | 14,992 | $ | 14,992 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Balance, beginning of period | $ | 13,028 | $ | 13,644 | $ | 12,437 | $ | 17,396 | |||||||
Net loss attributable to non-controlling interest | (655 | ) | (762 | ) | (520 | ) | (3,063 | ) | |||||||
Currency translation adjustment | (321 | ) | 283 | 135 | (1,168 | ) | |||||||||
Ending balance | $ | 12,052 | $ | 13,165 | $ | 12,052 | $ | 13,165 |
13. | Income Taxes |
14. | Commitments and Contingencies |
15. | Restructuring |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||
Beginning balance | $ | 8,506 | $ | 8,559 | $ | 7,249 | $ | — | ||||||
Restructuring charges | — | — | 1,589 | 8,559 | ||||||||||
Cash paid | (1,478 | ) | — | (2,125 | ) | — | ||||||||
Impact of foreign currency translation | 57 | 263 | 372 | 263 | ||||||||||
Ending balance | $ | 7,085 | $ | 8,822 | $ | 7,085 | $ | 8,822 |
Three Months Ended June 30, 2016 | Six Months Ended June 30, 2016 | ||||||
Beginning balance | $ | — | $ | — | |||
Restructuring charges | 3,506 | 3,506 | |||||
Cash paid | — | — | |||||
Impact of foreign currency translation | (18 | ) | (18 | ) | |||
Ending balance | $ | 3,488 | $ | 3,488 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||
Beginning balance | $ | 8,506 | $ | 8,559 | $ | 7,249 | $ | — | ||||||
Restructuring charges | 3,506 | — | 5,095 | 8,559 | ||||||||||
Cash paid | (1,478 | ) | — | (2,125 | ) | — | ||||||||
Impact of foreign currency translation | 39 | 263 | 354 | 263 | ||||||||||
Ending balance | $ | 10,573 | $ | 8,822 | $ | 10,573 | $ | 8,822 |
16. | Segment Information |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||
Fleet Solutions | $ | 701 | $ | 116 | $ | 1,586 | $ | 824 | ||||||
Travel and Corporate Solutions | 96 | 90 | 187 | 154 | ||||||||||
Health and Employee Benefit Solutions | 1,888 | 1,261 | 3,382 | 2,404 | ||||||||||
Total interest income | $ | 2,685 | $ | 1,467 | $ | 5,155 | $ | 3,382 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||
Fleet Solutions revenue | ||||||||||||||
Payment processing revenue | $ | 70,711 | $ | 80,127 | $ | 133,001 | $ | 153,070 | ||||||
Account servicing revenue | 27,548 | 25,360 | 52,986 | 49,243 | ||||||||||
Finance fee revenue | 30,674 | 19,069 | 52,611 | 38,064 | ||||||||||
Other revenue | 15,027 | 10,964 | 26,436 | 23,633 | ||||||||||
Total Fleet Solutions revenue | $ | 143,960 | $ | 135,520 | $ | 265,034 | $ | 264,010 | ||||||
Total Fleet Solutions operating interest expense | $ | 379 | $ | 421 | $ | 801 | $ | 1,161 | ||||||
Total Fleet Solutions depreciation and amortization | $ | 7,799 | $ | 6,975 | $ | 15,119 | $ | 14,433 | ||||||
Total Fleet Solutions adjusted pre-tax income before NCI | $ | 37,955 | $ | 49,490 | $ | 70,767 | $ | 94,774 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||
Travel and Corporate Solutions revenue | ||||||||||||||
Payment processing revenue | $ | 43,194 | $ | 37,564 | $ | 77,820 | $ | 70,199 | ||||||
Account servicing revenue | 337 | 472 | 610 | 880 | ||||||||||
Finance fee revenue | 145 | 73 | 221 | 129 | ||||||||||
Other revenue | 9,660 | 10,105 | 19,827 | 20,080 | ||||||||||
Total Travel and Corporate Solutions revenue | $ | 53,336 | $ | 48,214 | $ | 98,478 | $ | 91,288 | ||||||
Total Travel and Corporate Solutions operating interest expense | $ | 611 | $ | 266 | $ | 1,163 | $ | 266 | ||||||
Total Travel and Corporate Solutions depreciation and amortization | $ | 502 | $ | 328 | $ | 858 | $ | 674 | ||||||
Total Travel and Corporate Solutions adjusted pre-tax income before NCI | $ | 23,200 | $ | 21,726 | $ | 43,191 | $ | 41,014 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||
Health and Employee Benefit Solutions revenue | ||||||||||||||
Payment processing revenue | $ | 12,175 | $ | 10,390 | $ | 26,315 | $ | 22,247 | ||||||
Account servicing revenue | 19,548 | 12,642 | 38,359 | 25,299 | ||||||||||
Finance fee revenue | 1,885 | 1,259 | 3,378 | 2,399 | ||||||||||
Other revenue | 3,032 | 5,628 | 8,300 | 10,695 | ||||||||||
Total Health and Employee Benefit Solutions revenue | $ | 36,640 | $ | 29,919 | $ | 76,352 | $ | 60,640 | ||||||
Total Health and Employee Benefit Solutions operating interest expense | $ | 515 | $ | 670 | $ | 927 | $ | 1,509 | ||||||
Total Health and Employee Benefit Solutions depreciation and amortization | $ | 2,244 | $ | 1,440 | $ | 4,186 | $ | 2,864 | ||||||
Total Health and Employee Benefit Solutions adjusted pre-tax income before NCI | $ | 5,172 | $ | 4,700 | $ | 11,433 | $ | 11,095 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||
Income before income taxes | $ | 16,394 | $ | 42,841 | $ | 52,798 | $ | 77,366 | ||||||
Acquisition and divestiture related items | 34,255 | 12,016 | 62,200 | 22,960 | ||||||||||
Stock-based compensation | 4,870 | 3,942 | 9,113 | 7,160 | ||||||||||
Restructuring and other costs | 5,985 | — | 7,574 | 8,559 | ||||||||||
Changes in unrealized fuel price derivatives | — | 14,956 | 5,007 | 24,301 | ||||||||||
Net foreign currency remeasurement loss | 4,823 | 2,161 | (11,301 | ) | 6,537 | |||||||||
Adjusted pre-tax income before NCI | $ | 66,327 | $ | 75,916 | $ | 125,391 | $ | 146,883 |
• | The Company considers certain acquisition-related costs, including certain financing costs, ticking fees, investment banking fees, warranty and indemnity insurance, acquisition-related expenses and amortization of acquired intangibles, as well as gains and losses from divestitures to be unpredictable, dependent on factors that may be outside of our control and unrelated to the continuing operations of the acquired or divested business or the Company. In prior periods not reflected above, the Company has adjusted for goodwill impairments and acquisition related asset impairments. In addition, the size and complexity of an acquisition, which often drives the magnitude of acquisition-related costs, may not be indicative of such future costs. The Company believes that excluding acquisition-related costs and gains or losses of divestitures facilitates the comparison of our financial results to the Company's historical operating results and to other companies in our industry. |
• | Stock-based compensation is different from other forms of compensation, as it is a non-cash expense. For example, a cash salary generally has a fixed and unvarying cash cost. In contrast, the expense associated with an equity-based award is generally unrelated to the amount of cash ultimately received by the employee, and the cost to the Company is based on a stock-based compensation valuation methodology and underlying assumptions that may vary over time. |
• | Restructuring and other costs are related to employee termination benefits from certain identified initiatives to further streamline the business, improve the Company's efficiency, create synergies, globalize the Company's operations, and advance certain outsourcing initiatives, all with an objective to improve scale and increase profitability going forward. We exclude these items when evaluating our continuing business performance as such items are not consistently occurring and do not reflect expected future operating expense, nor provide meaningful insight into the fundamentals of current or past operations of our business. |
• | Exclusion of the non-cash, mark-to-market adjustments on fuel-price related derivative instruments helps management identify and assess trends in the Company's underlying business that might otherwise be obscured due to quarterly non-cash earnings fluctuations associated with fuel-price-related derivative contracts. |
• | 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. |
• | Net foreign currency gains and losses primarily result from the remeasurement to functional currency of foreign currency cash, receivable and payable balances, certain intercompany notes and any gain or loss on foreign currency hedges relating to these items. The exclusion of these items helps management compare changes in operating results between periods that might otherwise be obscured due to currency fluctuations. |
17. | Supplementary Regulatory Capital Disclosure |
Actual Amount | Ratio | Minimum for Capital Adequacy Purposes Amount | Ratio | Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions Amount | Ratio | |||||||||||||||
Total Capital to risk-weighted assets | $ | 210,365 | 12.62 | % | $ | 133,353 | 8.00 | % | $ | 166,692 | 10.00 | % | ||||||||
Tier 1 Capital to average assets | 203,505 | 12.20 | % | 66,723 | 4.00 | % | 83,404 | 5.00 | % | |||||||||||
Common equity to risk-weighted assets | 203,505 | 12.21 | % | 75,002 | 4.50 | % | 108,336 | 6.50 | % | |||||||||||
Tier 1 Capital to risk-weighted assets | 203,505 | 12.21 | % | 100,002 | 6.00 | % | 133,337 | 8.00 | % |
Actual Amount | Ratio | Minimum for Capital Adequacy Purposes Amount | Ratio | Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions Amount | Ratio | |||||||||||||||
Total Capital to risk-weighted assets | $ | 202,294 | 15.50 | % | $ | 104,437 | 8.00 | % | $ | 130,547 | 10.00 | % | ||||||||
Tier 1 Capital to average assets | 193,337 | 11.23 | % | 68,865 | 4.00 | % | 86,082 | 5.00 | % | |||||||||||
Common equity to risk-weighted assets | 193,337 | 14.81 | % | 58,746 | 4.50 | % | 84,855 | 6.50 | % | |||||||||||
Tier 1 Capital to risk-weighted assets | 193,337 | 14.81 | % | 78,328 | 6.00 | % | 104,437 | 8.00 | % |
18. | Subsequent Events |
• | solely with respect to the tranche B term loan facility, 50% (subject to reduction to 25% and 0% based upon the Company’s consolidated leverage ratio) of the Company’s annual Excess Cash Flow (as defined in the 2016 Credit Agreement); |
• | 100% of the net cash proceeds of certain asset sales where the proceeds exceed certain thresholds, and certain casualty and condemnation events, subject to reinvestment rights and certain other exceptions; and |
• | 100% of the net cash proceeds of any incurrence or issuance of certain debt, other than debt permitted under the 2016 Credit Agreement. |
• | a consolidated EBITDA to consolidated interest charge coverage ratio of no less than 3.25 to 1.00; and |
• | a consolidated funded indebtedness (excluding (i) up to an agreed amount of consolidated funded indebtedness under permitted securitization transactions and (ii) the non-recourse portion of any permitted factoring transaction) to consolidated EBITDA ratio of, initially, no more than 5.40 to 1.00, which ratio shall step down to 5.25 to 1.00 at December 31, 2016, 5.00 to 1.00 at December 31, 2017, 4.25 to 1.00 at December 31, 2018 and 4.00 to 1.00 at December 31, 2019. |
• | Average number of vehicles serviced decreased 2 percent from the second quarter of 2015 to approximately 9.6 million for the second quarter of 2016, primarily related to the divestiture of Pacific Pride. |
• | Total fuel transactions processed increased 2 percent from the second quarter of 2015 to 104.9 million for the second quarter of 2016. Total payment processing transactions in our Fleet Solutions segment increased 9 percent to 94.2 million for the second quarter of 2016 as compared to the same quarter in 2015. Transaction processing transactions decreased 35 percent to 10.7 million for the second quarter of 2016, as compared to the same quarter in 2015. The primary driver for the increase in payment processing transactions and decrease in transaction processing transactions was due to a large customer portfolio converting from an unfunded to a fully funded relationship in the beginning of 2016. |
• | Average expenditure per payment processing transaction in our Fleet Solutions segment decreased 19 percent to $55.61 for the second quarter of 2016, from $68.98 for the same period in the prior year. The average U.S. fuel price per gallon during the second quarter of 2016 was $2.29, a 16 percent decrease over the same period in the prior year. The average Australian fuel price per gallon during the second quarter of 2016 was $3.29, a 16 percent decrease as compared to the same period in the prior year. |
• | Credit loss expense in the Fleet Solutions segment was $5.3 million during the second quarter of 2016, as compared to $3.1 million during the second quarter of 2015. Spend volume decreased 12 percent in the second quarter of 2016, as compared to the same quarter last year and our credit losses were 10.2 basis points of fuel expenditures for the second quarter of 2016, as compared to 5.3 basis points of fuel expenditures for the same period last year. |
• | There were no realized gains or losses on fuel price derivatives during the second quarter of 2016 as compared to a realized gain of $9.0 million for the same period in the prior year. |
• | Travel and Corporate solutions purchase volume grew by approximately $0.7 billion from the second quarter of 2015 to $5.6 billion for the second quarter of 2016, an increase of 14 percent, driven by organic growth in our travel product. |
• | Our foreign currency exchange exposure is primarily related to the re-measurement of our cash, receivable and payable balances that are denominated in foreign currencies. Movements in the exchange rates associated with our foreign held currencies resulted in a loss of $4.8 million for the second quarter of 2016, compared to a loss of $2.2 million for the second quarter of 2015. |
• | Our effective tax rate was 27.3 percent for the second quarter of 2016 as compared to 38.4 percent for the second quarter of 2015. Discrete items in the second quarter of 2016 contributed to the lower effective tax rate, as compared to the second quarter of 2015. Future tax rates may fluctuate due to changes in the mix of earnings among different tax jurisdictions. Our tax rate may also fluctuate due to the impacts that rate and mix changes have on our net deferred tax assets. We anticipate that our future GAAP effective tax rate should be within the range of our historical rates. |
(in thousands, except per transaction and per gallon data) | Three months ended June 30, | Increase (decrease) | Six months ended June 30, | Increase (decrease) | |||||||||||||||||||||||||
2016 | 2015 | Amount | Percent | 2016 | 2015 | Amount | Percent | ||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||
Payment processing revenue | $ | 70,711 | $ | 80,127 | $ | (9,416 | ) | (12 | )% | $ | 133,001 | $ | 153,070 | $ | (20,069 | ) | (13 | )% | |||||||||||
Account servicing revenue | 27,548 | 25,360 | 2,188 | 9 | % | 52,986 | 49,243 | 3,743 | 8 | % | |||||||||||||||||||
Finance fee revenue | 30,674 | 19,069 | 11,605 | 61 | % | 52,611 | 38,064 | 14,547 | 38 | % | |||||||||||||||||||
Other revenue | 15,027 | 10,964 | 4,063 | 37 | % | 26,436 | 23,633 | 2,803 | 12 | % | |||||||||||||||||||
Total revenues | 143,960 | 135,520 | 8,440 | 6 | % | 265,034 | 264,010 | 1,024 | — | % | |||||||||||||||||||
Total operating expenses | 117,965 | 97,413 | 20,552 | 21 | % | 223,299 | 201,286 | 22,013 | 11 | % | |||||||||||||||||||
Operating income | 25,995 | 38,107 | (12,112 | ) | (32 | )% | 41,735 | 62,724 | (20,989 | ) | (33 | )% | |||||||||||||||||
Net foreign currency gain (loss) | 419 | (1,231 | ) | 1,650 | NM | 12,947 | (1,587 | ) | 14,534 | (916 | )% | ||||||||||||||||||
Financing interest expense | (25,084 | ) | (8,593 | ) | (16,491 | ) | 192 | % | (41,019 | ) | (17,830 | ) | (23,189 | ) | 130 | % | |||||||||||||
Net realized and unrealized gains on derivative instruments | — | (6,000 | ) | 6,000 | (100 | )% | 711 | (3,251 | ) | 3,962 | (122 | )% | |||||||||||||||||
Income before income taxes | $ | 1,330 | $ | 22,283 | $ | (20,953 | ) | (94 | )% | $ | 14,374 | $ | 40,056 | $ | (25,682 | ) | (64 | )% | |||||||||||
Key operating statistics | |||||||||||||||||||||||||||||
Payment processing revenue: | |||||||||||||||||||||||||||||
Payment processing transactions | 94,155 | 86,700 | 7,455 | 9 | % | 183,252 | 168,634 | 14,618 | 9 | % | |||||||||||||||||||
Average expenditure per payment processing transaction | $ | 55.61 | $ | 68.98 | $ | (13.37 | ) | (19 | )% | $ | 52.24 | $ | 67.16 | $ | (14.92 | ) | (22 | )% | |||||||||||
Average price per gallon of fuel | |||||||||||||||||||||||||||||
Domestic – ($/gal) | $ | 2.29 | $ | 2.74 | $ | (0.45 | ) | (16 | )% | $ | 2.13 | $ | 2.66 | $ | (0.53 | ) | (20 | )% | |||||||||||
Australia – ($/gal) | $ | 3.29 | $ | 3.91 | $ | (0.62 | ) | (16 | )% | $ | 3.20 | $ | 3.82 | $ | (0.62 | ) | (16 | )% | |||||||||||
Account servicing revenue: | |||||||||||||||||||||||||||||
Average number of vehicles serviced | 9,640 | 9,798 | (158 | ) | (2 | )% | 9,579 | 9,535 | 44 | — | % |
(in thousands) | Three Months Ended June 30, | Increase (decrease) | Six Months Ended June 30, | Increase (decrease) | |||||||||||||||||||||||||
2016 | 2015 | Amount | Percent | 2016 | 2015 | Amount | Percent | ||||||||||||||||||||||
Late fee revenue | $ | 25,904 | $ | 15,066 | $ | 10,838 | 72 | % | $ | 43,491 | $ | 30,392 | $ | 13,099 | 43 | % | |||||||||||||
Factoring fee revenue | 4,553 | 3,800 | $ | 753 | 20 | % | 8,716 | 7,239 | 1,477 | 20 | % | ||||||||||||||||||
Cardholder interest income | 179 | 110 | $ | 69 | 63 | % | 338 | 186 | 152 | 82 | % | ||||||||||||||||||
Other finance fee revenue | 38 | 93 | $ | (55 | ) | (59 | )% | 66 | 247 | (181 | ) | (73 | )% | ||||||||||||||||
Total finance fee revenue | $ | 30,674 | $ | 19,069 | $ | 11,605 | 61 | % | $ | 52,611 | $ | 38,064 | $ | 14,547 | 38 | % |
Increase (decrease) | ||||||||||||||
(in thousands) | June 30, 2016 | June 30, 2015 | Amount | Percent | ||||||||||
Expense | ||||||||||||||
Salary and other personnel | $ | 45,585 | $ | 42,529 | $ | 3,056 | 7 | % | ||||||
Restructuring | $ | 3,506 | $ | — | $ | 3,506 | NM | |||||||
Service fees | $ | 24,412 | $ | 14,937 | $ | 9,475 | 63 | % | ||||||
Provision for credit losses | $ | 5,314 | $ | 3,137 | $ | 2,177 | 69 | % | ||||||
Technology leasing and support | $ | 6,351 | $ | 6,061 | $ | 290 | 5 | % | ||||||
Depreciation and amortization | $ | 14,147 | $ | 13,997 | $ | 150 | 1 | % |
Increase (decrease) | ||||||||||||||
(in thousands) | June 30, 2016 | June 30, 2015 | Amount | Percent | ||||||||||
Expense | ||||||||||||||
Salary and other personnel | $ | 89,627 | $ | 85,166 | $ | 4,461 | 5 | % | ||||||
Restructuring | $ | 5,095 | $ | 8,559 | $ | (3,464 | ) | (40 | )% | |||||
Service fees | $ | 41,536 | $ | 27,137 | $ | 14,399 | 53 | % | ||||||
Provision for credit losses | $ | 9,355 | $ | 6,779 | $ | 2,576 | 38 | % | ||||||
Technology leasing and support | $ | 12,919 | $ | 11,682 | $ | 1,237 | 11 | % | ||||||
Depreciation and amortization | $ | 27,755 | $ | 28,574 | $ | (819 | ) | (3 | )% |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
(in thousands, except per gallon data) | 2016 | 2015 | 2016 | 2015 | |||||||||||
Fuel price derivatives, at fair value, beginning of period | $ | — | $ | 31,624 | $ | 5,007 | $ | 40,969 | |||||||
Net change in fair value | — | (6,000 | ) | 711 | (3,251 | ) | |||||||||
Cash payments on settlement | — | (8,956 | ) | (5,718 | ) | (21,050 | ) | ||||||||
Fuel price derivatives, at fair value, end of period | $ | — | $ | 16,668 | $ | — | $ | 16,668 | |||||||
Collar range: | |||||||||||||||
Floor | $ | — | $ | 3.37 | $ | 3.28 | $ | 3.36 | |||||||
Ceiling | $ | — | $ | 3.43 | $ | 3.34 | $ | 3.42 | |||||||
Domestic average fuel price, beginning of period | $ | 2.09 | $ | 2.56 | $ | 2.09 | $ | 2.56 | |||||||
Domestic average fuel price, end of period | $ | 2.33 | $ | 2.79 | $ | 2.33 | $ | 2.79 |
Three months ended June 30, | Increase (decrease) | Six months ended June 30, | Increase (decrease) | ||||||||||||||||||||||||||
(in thousands, except payment solutions purchase volume in millions) | 2016 | 2015 | Amount | Percent | 2016 | 2015 | Amount | Percent | |||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||
Payment processing revenue | $ | 43,194 | $ | 37,564 | $ | 5,630 | 15 | % | $ | 77,820 | $ | 70,199 | $ | 7,621 | 11 | % | |||||||||||||
Account servicing revenue | 337 | 472 | (135 | ) | (29 | )% | 610 | 880 | (270 | ) | (31 | )% | |||||||||||||||||
Finance fee revenue | 145 | 73 | 72 | 99 | % | 221 | 129 | 92 | 71 | % | |||||||||||||||||||
Other revenue | 9,660 | 10,105 | (445 | ) | (4 | )% | 19,827 | 20,080 | (253 | ) | (1 | )% | |||||||||||||||||
Total revenues | 53,336 | 48,214 | 5,122 | 11 | % | 98,478 | 91,288 | 7,190 | 8 | % | |||||||||||||||||||
Total operating expenses | 30,434 | 26,422 | 4,012 | 15 | % | 55,850 | 50,000 | 5,850 | 12 | % | |||||||||||||||||||
Operating income | 22,902 | 21,792 | 1,110 | 5 | % | 42,628 | 41,288 | 1,340 | 3 | % | |||||||||||||||||||
Net foreign currency loss | (5,691 | ) | (493 | ) | (5,198 | ) | 1,054 | % | (2,451 | ) | (4,542 | ) | 2,091 | (46 | )% | ||||||||||||||
Income before income taxes | $ | 17,211 | $ | 21,299 | $ | (4,088 | ) | (19 | )% | $ | 40,177 | $ | 36,746 | $ | 3,431 | 9 | % | ||||||||||||
Key operating statistics | |||||||||||||||||||||||||||||
Payment processing revenue: | |||||||||||||||||||||||||||||
Payment solutions purchase volume | $ | 5,595 | $ | 4,922 | $ | 673 | 14 | % | $ | 10,474 | $ | 9,073 | $ | 1,401 | 15 | % |
Increase (decrease) | ||||||||||||||
(in thousands) | June 30, 2016 | June 30, 2015 | Amount | Percent | ||||||||||
Expense | ||||||||||||||
Salary and other personnel | $ | 5,536 | $ | 5,976 | $ | (440 | ) | (7 | )% | |||||
Service fees | $ | 17,421 | $ | 15,081 | $ | 2,340 | 16 | % | ||||||
Technology leasing and support & occupancy and equipment | $ | 3,774 | $ | 3,217 | $ | 557 | 17 | % |
Increase (decrease) | ||||||||||||||
(in thousands) | June 30, 2016 | June 30, 2015 | Amount | Percent | ||||||||||
Expense | ||||||||||||||
Salary and other personnel | $ | 10,600 | $ | 11,134 | $ | (534 | ) | (5 | )% | |||||
Service fees | $ | 32,339 | $ | 29,064 | $ | 3,275 | 11 | % | ||||||
Technology leasing and support & occupancy and equipment | $ | 7,337 | $ | 6,323 | $ | 1,014 | 16 | % |
Three months ended June 30, | Increase (decrease) | Six months ended June 30, | Increase (decrease) | ||||||||||||||||||||||||||
(in thousands, except payment solutions purchase volume in millions) | 2016 | 2015 | Amount | Percent | 2016 | 2015 | Amount | Percent | |||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||
Payment processing revenue | $ | 12,175 | $ | 10,390 | $ | 1,785 | 17 | % | $ | 26,315 | $ | 22,247 | $ | 4,068 | 18 | % | |||||||||||||
Account servicing revenue | 19,548 | 12,642 | 6,906 | 55 | % | 38,359 | 25,299 | 13,060 | 52 | % | |||||||||||||||||||
Finance fee revenue | 1,885 | 1,259 | 626 | 50 | % | 3,378 | 2,399 | 979 | 41 | % | |||||||||||||||||||
Other revenue | 3,032 | 5,628 | (2,596 | ) | (46 | )% | 8,300 | 10,695 | (2,395 | ) | (22 | )% | |||||||||||||||||
Total revenues | 36,640 | 29,919 | 6,721 | 22 | % | 76,352 | 60,640 | 15,712 | 26 | % | |||||||||||||||||||
Total operating expenses | 33,902 | 26,900 | 7,002 | 26 | % | 67,953 | 53,494 | 14,459 | 27 | % | |||||||||||||||||||
Operating income | 2,738 | 3,019 | (281 | ) | (9 | )% | 8,399 | 7,146 | 1,253 | 18 | % | ||||||||||||||||||
Net foreign currency gain | 449 | (437 | ) | 886 | NM | 805 | (408 | ) | 1,213 | NM | |||||||||||||||||||
Financing interest expense | (5,334 | ) | (3,323 | ) | (2,011 | ) | 61 | % | (10,957 | ) | (6,174 | ) | (4,783 | ) | 77 | % | |||||||||||||
Income before income taxes | $ | (2,147 | ) | $ | (741 | ) | $ | (1,406 | ) | 190 | % | $ | (1,753 | ) | $ | 564 | $ | (2,317 | ) | (411 | )% | ||||||||
Purchase volume | $ | 1,051 | $ | 760 | $ | 291 | 38 | % | $ | 2,144 | $ | 1,650 | $ | 494 | 30 | % |
Increase (decrease) | ||||||||||||||
(in thousands) | June 30, 2016 | June 30, 2015 | Amount | Percent | ||||||||||
Expense | ||||||||||||||
Salary and other personnel | $ | 15,541 | $ | 10,586 | $ | 4,955 | 47 | % | ||||||
Service fees | $ | 4,091 | $ | 3,923 | $ | 168 | 4 | % | ||||||
Technology leasing and support & occupancy and equipment | $ | 2,481 | $ | 2,082 | $ | 399 | 19 | % | ||||||
Depreciation and amortization | $ | 8,201 | $ | 6,314 | $ | 1,887 | 30 | % |
Increase (decrease) | ||||||||||||||
(in thousands) | June 30, 2016 | June 30, 2015 | Amount | Percent | ||||||||||
Expense | ||||||||||||||
Salary and other personnel | $ | 29,845 | $ | 21,208 | $ | 8,637 | 41 | % | ||||||
Service fees | $ | 8,808 | $ | 7,810 | $ | 998 | 13 | % | ||||||
Technology leasing and support & occupancy and equipment | $ | 5,181 | $ | 4,096 | $ | 1,085 | 26 | % | ||||||
Depreciation and amortization | $ | 16,241 | $ | 12,657 | $ | 3,584 | 28 | % |
• | The Company considers certain acquisition-related costs, including certain financing costs, ticking fees, investment banking fees, warranty and indemnity insurance, acquisition-related expenses and amortization of acquired intangibles, as well as gains and losses from divestitures to be unpredictable, dependent on factors that may be outside of our control and unrelated to the continuing operations of the acquired or divested business or the Company. In prior periods not reflected above, the Company has adjusted for goodwill impairments, acquisition related asset impairments and adjustments to the tax receivable agreement. In addition, the size and complexity of an acquisition, which often drives the magnitude of acquisition-related costs, may not be indicative of such future costs. The Company believes that excluding acquisition-related costs and gains or losses of divestitures facilitates the comparison of our financial results to the Company's historical operating results and to other companies in our industry. |
• | Stock-based compensation is different from other forms of compensation, as it is a non-cash expense. For example, a cash salary generally has a fixed and unvarying cash cost. In contrast, the expense associated with an equity-based award is generally unrelated to the amount of cash ultimately received by the employee, and the cost to the Company is based on a stock-based compensation valuation methodology and underlying assumptions that may vary over time. |
• | Restructuring and other costs are related to employee termination benefits from certain identified initiatives to further streamline the business, improve the Company's efficiency, create synergies, globalize the Company's operations, and advance certain outsourcing initiatives, all with an objective to improve scale and increase profitability going forward. We exclude these items when evaluating our continuing business performance as such items are not consistently occurring and do not reflect expected future operating expense, nor provide meaningful insight into the fundamentals of current or past operations of our business. |
• | Exclusion of the non-cash, mark-to-market adjustments on fuel-price related derivative instruments helps management identify and assess trends in the Company's underlying business that might otherwise be obscured due to quarterly non-cash earnings fluctuations associated with fuel-price-related derivative contracts. |
• | 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. |
• | Net foreign currency gains and losses primarily result from the remeasurement to functional currency of foreign currency cash, receivable and payable balances, certain intercompany notes and any gain or loss on foreign currency hedges relating to these items. The exclusion of these items helps management compare changes in operating results between periods that might otherwise be obscured due to currency fluctuations. |
• | The adjustments attributable to non-controlling interests, including adjustments to the redemption value of a non-controlling interest, have no significant impact on the ongoing operations of the business. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||
Net earnings attributable to WEX Inc. | $ | 12,567 | $ | 26,492 | $ | 35,653 | $ | 48,837 | ||||||
Acquisition and divestiture related items | 34,255 | 12,016 | 62,200 | 22,960 | ||||||||||
Stock-based compensation | 4,870 | 3,942 | 9,113 | 7,160 | ||||||||||
Restructuring and other costs | 5,985 | — | 7,574 | 8,559 | ||||||||||
Changes in unrealized fuel price derivatives | — | 14,956 | 5,007 | 24,301 | ||||||||||
Net foreign currency remeasurement loss | 4,823 | 2,161 | (11,301 | ) | 6,537 | |||||||||
ANI adjustments attributable to non-controlling interest | (930 | ) | (765 | ) | (861 | ) | (3,618 | ) | ||||||
Tax related items | (19,495 | ) | (10,485 | ) | (27,729 | ) | (20,201 | ) | ||||||
Adjusted net income attributable to WEX Inc. | $ | 42,075 | $ | 48,317 | $ | 79,656 | $ | 94,535 |
(in thousands) | Six months ended June 30, | ||||||
2016 | 2015 | ||||||
Net cash (used for) provided by operating activities | $ | (56,776 | ) | $ | 53,015 | ||
Net cash used for investing activities | (41,155 | ) | (10,246 | ) | |||
Net cash provided by (used for) financing activities | 128,639 | (138,963 | ) |
• | solely with respect to the tranche B term loan facility, 50% (subject to reduction to 25% and 0% based upon the Company’s consolidated leverage ratio) of the Company’s annual Excess Cash Flow (as defined in the 2016 Credit Agreement); |
• | 100% of the net cash proceeds of certain asset sales where the proceeds exceed certain thresholds, and certain casualty and condemnation events, subject to reinvestment rights and certain other exceptions; and |
• | 100% of the net cash proceeds of any incurrence or issuance of certain debt, other than debt permitted under the 2016 Credit Agreement. |
Three months ended June 30, | |||||||||||||
2016 | 2015 | ||||||||||||
(in thousands) | Shares | Cost | Shares | Cost | |||||||||
Treasury stock purchased | — | $ | — | 210 | $ | 22,011 |
WEX INC. | |||
August 9, 2016 | By: | /s/ Roberto Simon | |
Roberto Simon | |||
Chief Financial Officer | |||
(principal financial officer and principal accounting officer) |
Exhibit No. | Description | ||
3.1 | Certificate of Incorporation (incorporated by reference to Exhibit No. 3.1 to our Current Report on Form 8-K filed with the SEC on March 1, 2005, File No. 001-32426) | ||
3.2 | Certificate of Ownership and Merger merging WEX Transitory Corporation with and into Wright Express Corporation (incorporated by reference to Exhibit No. 3.1 to our Current Report on Form 8-K filed with the SEC on October 30, 2012, File No. 001-32426) | ||
3.3 | Amended and Restated By-Laws of WEX Inc. (incorporated by reference to Exhibit No. 3.1 to our Current Report on Form 8-K filed with the SEC on October 30, 2012, File No. 001-32426) | ||
4.2 | Indenture, dated as of January 30, 2013, among WEX Inc., the Guarantors named therein, and The Bank of New York Mellon Trust Company, N.A. (incorporated by reference to Exhibit No. 4.1 to our Current Report on Form 8-K filed with the SEC on February 1, 2013, File No. 001-32426) | ||
10.1 | Second Amendment to the Second amended and Restated Agreement, dated as of August 22, 2014, among WEX Inc. and Certain Subsidiaries, as borrowers, Bank of America, N.A., as administrative agent, swing line lender and L/C issuer, and the Other Lenders Party hereto (incorporated by reference to Exhibit No. 10.1 to our Current Report on Form 8-K filed with the SEC on May 23, 2016, File No. 001-32426) | ||
* | 31.1 | Certification of Chief Executive Officer of WEX INC. pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as amended | |
* | 31.2 | Certification of Chief Financial Officer of WEX INC. pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as amended | |
* | 32.1 | Certification of Chief Executive Officer of WEX INC. pursuant to Rule 13a-14(b) promulgated under the Securities Exchange Act of 1934, as amended, and Section 1350 of Chapter 63 of Title 18 of the United States Code | |
* | 32.2 | Certification of Chief Financial Officer of WEX INC. pursuant to Rule 13a-14(b) promulgated under the Securities Exchange Act of 1934, as amended, and Section 1350 of Chapter 63 of Title 18 of the United States Code | |
* | 101.INS | XBRL Instance Document | |
* | 101.SCH | XBRL Taxonomy Extension Schema Document | |
* | 101.CAL | XBRL Taxonomy Calculation Linkbase Document | |
* | 101.LAB | XBRL Taxonomy Label Linkbase Document | |
* | 101.PRE | XBRL Taxonomy Presentation Linkbase Document | |
* | 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
* | These exhibits have been filed with this Quarterly Report on Form 10-Q. |
1. | I have reviewed this quarterly report on Form 10-Q of WEX Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Melissa D. Smith |
Melissa D. Smith |
Chief Executive Officer and President |
1. | I have reviewed this quarterly report on Form 10-Q of WEX Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Roberto Simon |
Roberto Simon |
Chief Financial Officer |
(Principal accounting and financial officer) |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Melissa D. Smith |
Melissa D. Smith |
Chief Executive Officer and President |
August 9, 2016 |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Roberto Simon |
Roberto Simon |
Chief Financial Officer |
(Principal accounting and financial officer) |
August 9, 2016 |
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Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Aug. 04, 2016 |
|
Document And Entity Information [Abstract] | ||
Entity Registrant Name | WEX Inc. | |
Trading Symbol | WEX | |
Entity Central Index Key | 0001309108 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2016 | |
Document Fiscal Period Focus (Q1,Q2,Q3,FY) | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 42,720,344 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Accounts receivable, reserve for credit losses | $ 13,064 | $ 13,832 |
Property, equipment and capitalized software, accumulated depreciation | $ 212,060 | $ 192,140 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 175,000,000 | 175,000,000 |
Common stock, shares issued | 43,146,000 | 43,079,000 |
Common stock, shares outstanding | 38,814,000 | 38,746,000 |
Treasury stock, shares | 4,428,000 | 4,428,000 |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Revenues [Abstract] | ||||
Payment processing revenue | $ 126,080 | $ 128,081 | $ 237,136 | $ 245,516 |
Account servicing revenue | 47,433 | 38,474 | 91,955 | 75,422 |
Finance fee revenue | 32,704 | 20,401 | 56,210 | 40,592 |
Other revenue | 27,719 | 26,697 | 54,563 | 54,408 |
Total revenues | 233,936 | 213,653 | 439,864 | 415,938 |
Expenses | ||||
Salary and other personnel | 66,662 | 59,091 | 130,072 | 117,508 |
Restructuring | 3,506 | 0 | 5,095 | 8,559 |
Service fees | 45,924 | 33,941 | 82,683 | 64,011 |
Provision for credit losses | 6,443 | 3,983 | 10,360 | 7,897 |
Technology leasing and support | 10,932 | 10,021 | 22,008 | 19,455 |
Occupancy and equipment | 6,113 | 5,034 | 11,825 | 10,031 |
Depreciation and amortization | 23,109 | 20,759 | 45,373 | 42,146 |
Operating interest expense | 1,505 | 1,357 | 2,891 | 2,936 |
Cost of hardware and equipment sold | 665 | 684 | 1,570 | 1,793 |
Other | 17,442 | 15,865 | 35,225 | 31,659 |
Gain on divestiture | 0 | 0 | 0 | (1,215) |
Total operating expenses | 182,301 | 150,735 | 347,102 | 304,780 |
Operating income | 51,635 | 62,918 | 92,762 | 111,158 |
Financing interest expense | (30,418) | (11,916) | (51,976) | (24,004) |
Net foreign currency (loss) gain | (4,823) | (2,161) | 11,301 | (6,537) |
Net realized and unrealized (loss) gain on fuel price derivative instruments | 0 | (6,000) | 711 | (3,251) |
Income before income taxes | 16,394 | 42,841 | 52,798 | 77,366 |
Income taxes | 4,482 | 16,441 | 17,665 | 30,933 |
Net income | 11,912 | 26,400 | 35,133 | 46,433 |
Less: Net loss attributable to non-controlling interests | (655) | (92) | (520) | (2,404) |
Net earnings attributable to WEX Inc. | $ 12,567 | $ 26,492 | $ 35,653 | $ 48,837 |
Net earnings attributable to WEX Inc. per share: | ||||
Basic (in dollars per share) | $ 0.32 | $ 0.68 | $ 0.92 | $ 1.26 |
Diluted (in dollars per share) | $ 0.32 | $ 0.68 | $ 0.92 | $ 1.26 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 38,806 | 38,739 | 38,781 | 38,798 |
Diluted (in shares) | 38,857 | 38,799 | 38,850 | 38,880 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 11,912 | $ 26,400 | $ 35,133 | $ 46,433 |
Changes in available-for-sale securities, net of tax effect of $63 and $(82) for the three months ended June 30, 2016 and 2015 and $160 and $(29) for the six months ended June 30, 2016 and 2015 | 107 | (140) | 271 | (49) |
Foreign currency translation | (11,479) | 8,749 | (705) | (20,317) |
Comprehensive income | 540 | 35,009 | 34,699 | 26,067 |
Less: comprehensive (loss) income attributable to non-controlling interests | (976) | 866 | (385) | (5,829) |
Comprehensive income attributable to WEX Inc. | $ 1,516 | $ 34,143 | $ 35,084 | $ 31,896 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
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Statement of Comprehensive Income [Abstract] | ||||
Changes in available-for-sale securities, tax effect | $ 63 | $ (82) | $ 160 | $ (29) |
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands |
6 Months Ended | |
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Jun. 30, 2016 |
Jun. 30, 2015 |
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Statement of Stockholders' Equity [Abstract] | ||
Changes in available-for-sale securities, tax effect | $ 160 | $ (29) |
Basis of Presentation |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation |
The acronyms and abbreviations identified below are used in the accompanying unaudited condensed consolidated financial statements and the notes thereto. The following is provided to aid the reader and provide a reference point when reviewing the unaudited condensed consolidated financial statements.
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. They do not include all information and notes required by GAAP for complete financial statements. However, except as disclosed herein, there have been no material changes in the information disclosed in the notes to the consolidated financial statements included in the Annual Report on Form 10-K of WEX Inc. for the year ended December 31, 2015. These unaudited condensed consolidated financial statements should be read in conjunction with the financial statements that are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, filed with the SEC on February 26, 2016. In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2016 are not necessarily indicative of the results that may be expected for any future periods or the year ending December 31, 2016. The presentation of the accompanying condensed consolidated statements of income has been updated for the three and six month periods ended June 30, 2015 to disaggregate revenue into payment processing, account servicing, finance fee and other revenue in order to provide additional information regarding the Company’s significant revenue streams and to conform to the current year presentation. There was no change to total revenue, income from operations, net income or net income per share in any of the periods presented as a result of this updated presentation. In April 2015, the FASB issued ASU 2015-03 related to the simplification of the presentation of debt issuance costs. The standard requires entities to present such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. The ASU provides that debt issuance costs are analogous to debt discounts and reduce the proceeds of borrowing which increases the effective interest rate. Prior to the amendment, debt issuance costs were reported in the balance sheet as an asset. The amended guidance is effective for financial statements issued for fiscal years beginning after December 15, 2015, requires retrospective adoption, and represents a change in accounting principle. As a result of the adoption, the December 31, 2015 unaudited condensed consolidated balance sheet is restated as follows:
Fair Value of Financial Instruments The carrying values of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, and other liabilities approximate their respective fair values due to the short-term nature of such instruments. The carrying values of certificates of deposit, interest-bearing money market deposits, borrowed federal funds and credit agreement borrowings approximate their respective fair values as the interest rates on these financial instruments are variable. All other financial instruments are reflected at fair value on the unaudited condensed consolidated balance sheets. |
New Accounting Standards |
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Jun. 30, 2016 | |||||||
Accounting Changes and Error Corrections [Abstract] | |||||||
New Accounting Standards |
In May 2014, the FASB issued ASU 2014-09 related to revenue recognition, which will supersede most existing revenue recognition guidance under U.S. GAAP. The new revenue recognition standard requires entities to recognize revenue for the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard permits the use of either the retrospective or cumulative effect transition method. On July 9, 2015, the Board voted to defer the effective date by one year to interim and annual reporting periods beginning after December 15, 2017, and permitted early adoption of the standard, but not for periods beginning on or before the original effective date of December 15, 2016. In March 2016, the FASB issued ASU 2016-08, in April 2016, the FASB issued ASU 2016-10, and in May 2016, the FASB issued ASU 2016-12, in each case to clarify the implementation guidance on the new revenue recognition standard. The effective dates for these standards are the same as the effective date for ASU 2014-09. The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures and has not yet selected a transition method. In September 2015, the FASB issued ASU 2015-16 related to simplifying the accounting for measurement period adjustments. This standard replaces the requirement that an acquirer in a business combination account for measurement period adjustments retrospectively with a requirement that an acquirer recognize adjustments to the provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The acquirer is required to record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. The guidance is to be applied prospectively to adjustments to provisional amounts that occur after the effective date of the guidance. The Company adopted this standard on January 1, 2016. In January 2016, the FASB issued ASU 2016-01 related to accounting for equity investments. The pronouncement requires equity investments, except those accounted for under the equity method of accounting, or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income. The standard is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The Company is currently evaluating the impact the pronouncement will have on the consolidated financial statements and related disclosures. In February 2016, the FASB issued ASU 2016-02 to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. When transitioning, the standard requires leases to be recognized and measured at the beginning of the earliest period presented using a modified retrospective approach. Certain qualitative and quantitative disclosures are required. The standard is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period. The Company is currently evaluating the impact the standard will have on the consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU 2016-09 to simplify several aspects of accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, statutory tax withholding requirements, and classification in the statement of cash flows. The standard is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. The Company is currently evaluating the impact the standard will have on the consolidated financial statements and related disclosures. In June 2016, the FASB issued ASU 2016-13 which requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. This amount will be based on historical experience, current conditions, and reasonable and supportable forecasts that impact the collectability of the reported amount. The standard is effective for annual reporting periods beginning after December 15, 2019, including interim periods within those fiscal years. The Company is currently evaluating the impact the standard will have on the consolidated financial statements and related disclosures. |
Business Acquisitions |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisitions |
Benaissance On November 18, 2015, the Company purchased the stock of Benaissance for approximately $80,677, subject to working capital adjustments. The transaction was financed through the Company’s cash on hand and existing credit facility. Benaissance provides financial management for health benefits administration by offering SaaS solutions for individual single point and consolidated group premium billing. The Company acquired Benaissance to enhance the Company's positioning in the growing healthcare market. During the fourth quarter of 2015, the Company obtained preliminary information to assist in determining the fair values of certain tangible and intangible assets acquired and liabilities assumed in the Benaissance acquisition. During the first quarter of 2016, the Company decreased certain tangible assets by $502 and increased Goodwill by $502. Based on such information, the Company recorded intangible assets and goodwill as described below. Goodwill is expected to be deductible for tax purposes. The Company expects to finalize the purchase accounting in the third quarter of 2016. The following is a summary of the final allocation of the purchase price to the assets and liabilities acquired:
No pro forma information has been included in these financial statements as the operations of Benaissance for the period that they were not part of the Company are not material to the Company's revenues, net income and earnings per share. Acquisition of remaining 49% of UNIK On August 31, 2015, the Company acquired the remaining 49 percent ownership in UNIK for $46,018. See Note 12 Non-controlling Interests for further information. |
Sale of Subsidiary and Assets |
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Discontinued Operations and Disposal Groups [Abstract] | |||||||
Sale of Subsidiary and Assets |
rapid! PayCard On January 7, 2015, the Company sold the assets of its rapid! PayCard operations for $20,000, which resulted in a pre-tax book gain of approximately $1,215. The Company's primary focus in the U.S. continues to be in the fleet, travel, and healthcare industries. As such, the Company divested the operations of rapid! PayCard, which were not material to the Company's annual revenue, net income or earnings per share. The Company does not view this divestiture as a strategic shift in its operations. |
Reserves for Credit Losses |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reserves for Credit Losses |
In general, the Company’s trade receivables provide for payment terms of 30 days or less. Receivables not paid within the terms of the customer agreement are generally subject to late fees based upon the outstanding customer receivable balance. Beginning in the first quarter of 2015, the Company began to extend revolving credit to certain customers with respect to small fleet receivables. These accounts are also subject to late fees and balances that are not paid in full are subject to interest charges based on the revolving balance. The Company had approximately $1,900 in receivables with revolving credit as of June 30, 2016 and $1,100 in receivables with revolving credit as of December 31, 2015. The portfolio of receivables consists of a large group of homogeneous smaller balance amounts that are collectively evaluated for impairment. No customer made up more than eight percent of the outstanding receivables at June 30, 2016. One customer made up eleven percent of the outstanding receivables at December 31, 2015. Receivables are generally written off when they are 150 days past due or upon declaration of bankruptcy by the customer. The reserve for credit losses is calculated by an analytic model that also takes into account other factors, such as the actual charge-offs for the preceding reporting periods, expected charge-offs and recoveries for the subsequent reporting periods, a review of accounts receivable balances which become past due, changes in customer payment patterns, known fraudulent activity in the portfolio, as well as leading economic and market indicators. As of June 30, 2016, approximately 92 percent of the outstanding balance of total trade accounts receivable was current and approximately 98 percent of the outstanding balance of total trade accounts receivable was less than 60 days past due. As of June 30, 2015, approximately 91 percent of the outstanding balance of total trade accounts receivable was current and approximately 98 percent of the outstanding balance was less than 60 days past due. The outstanding balance is made up of receivables from a wide range of industries. The following table presents changes in reserves for credit losses related to accounts receivable:
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Goodwill and Other Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Other Intangible Assets |
Goodwill The changes in goodwill during the first six months of 2016 were as follows:
As described in Note 3, the Company adjusted the amount of goodwill in the current six-month period in the accompanying unaudited condensed consolidated balance sheet to account for the measurement period adjustments to goodwill associated with the Benaissance acquisition. The Company had no impairments to goodwill during the six months ended June 30, 2016. Other Intangible Assets The changes in other intangible assets during the first six months of 2016 were as follows:
The following table presents the estimated amortization expense related to the definite-lived intangible assets listed above for the remainder of 2016 and for each of the five succeeding fiscal years:
Other intangible assets, net consist of the following:
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Earnings per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per Share |
The following is a reconciliation of the income and share data used in the basic and diluted earnings per share computations for the three and six months ended June 30, 2016 and 2015:
For the three and six months ended June 30, 2016 and June 30, 2015, an immaterial number of outstanding stock options and restricted stock units were excluded from the computation of diluted earnings per share because the effect of including these options and restricted stock units would be anti-dilutive. |
Derivative Instruments |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments |
The Company is exposed to certain market risks relating to its ongoing business operations. Derivative instruments were utilized in prior years to manage the Company's commodity price risk. The Company entered into put and call option contracts related to the Company’s commodity price risk, which were based on the wholesale price of gasoline and the retail price of diesel fuel and settled on a monthly basis. These put and call option contracts, or fuel price derivative instruments, were designed to reduce the volatility of the Company’s cash flows associated with its fuel price-related earnings exposure in North America. During the fourth quarter of 2014, the Company suspended purchases under its fuel derivatives program due to unusually low prices in the commodities market. Management will continue to monitor the fuel price market and evaluate alternatives as it relates to this hedging program. During the first quarter of 2016, the Company held fuel price sensitive derivative instruments to hedge approximately 20 percent of its anticipated U.S. fuel-price related earnings exposure based on assumptions at time of purchase and all these positions were settled as of March 31, 2016. After the first quarter of 2016, the Company is no longer hedged for changes in fuel prices. In April 2014, the Company initiated a partial foreign currency exchange hedging program. In 2014 the Company managed foreign currency exchange exposure on an intra-quarter basis. During the third quarter of 2015, the Company decided to suspend the foreign currency exchange hedging program for all but a few short-term intercompany transactions. Because this was a partial foreign currency exchange hedging program, the Company had foreign currency exchange exposure which was not hedged while the program was in effect. The realized and unrealized gains or losses on the currency forward contracts and swaps are reported in earnings within the same unaudited condensed consolidated statement of income line as the impact of the foreign currency translation, net foreign currency gain (loss). Accounting guidance requires companies to recognize all derivative instruments as either assets or liabilities at fair value in the unaudited condensed consolidated balance sheet. The Company’s fuel price derivative instruments and foreign currency instruments do not qualify for hedge accounting treatment, and therefore, no such hedging designation has been made. Derivatives Not Designated as Hedging Instruments For derivative instruments that are not designated as hedging instruments, the gain or loss on the derivative is recognized in current earnings. The following table presents information on the location and amounts of derivative gains and losses in the unaudited condensed consolidated statements of income:
The following table presents information on the location and amounts of derivative fair values in the unaudited condensed consolidated balance sheets:
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Financing and Other Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||
Financing and Other Debt |
In January 2016, the Company began to incur ticking fees for the debt financing commitment associated with the pending acquisition of EFS. Pursuant to the terms set forth in the bank commitment letter, the ticking fees were calculated based on the financing commitment in the aggregate amount of $2,125,000, and remained in place until the closing of the EFS acquisition on July 1, 2016 (see Note 18). Ticking fees were $19,545 for the three months ended June 30, 2016 and $30,045 for the six months ended June 30, 2016, and are included in financing interest expense. 2014 Credit Agreement As of June 30, 2016, the Company had $282,639, net of loan origination fees, of borrowings against its $700,000 revolving credit facility. The outstanding debt under the amortizing term loan arrangement, which was scheduled to expire in January of 2018, totaled $445,000 at June 30, 2016 and $458,750 at December 31, 2015. As of June 30, 2016, amounts outstanding under the amortizing term loan bore interest at a rate of LIBOR plus 200 basis points. The revolving credit facility bore interest at a rate equal to, at the Company's option, (a) LIBOR plus 200 basis points, (b) the prime rate plus 100 basis points for domestic borrowings; and the Eurocurrency rate plus 200 basis points for international borrowings. On May 20, 2016, the Company entered into a second amendment to its 2014 Credit Agreement among existing lenders to provide for an increase of the maximum Consolidated Leverage Ratio (as defined in the 2014 Credit Agreement) for each of the next three quarters from 3.25 to 1.00 to (i) 3.75 to 1.00 for the fiscal quarters ending June 30, 2016 and September 30, 2016 and (ii) 3.50 to 1.00 for the fiscal quarter ending December 31, 2016. On July 1, 2016, the Company entered into the 2016 Credit Agreement, which replaced the 2014 Credit Agreement. See Note 18 for a discussion of the 2016 Credit Agreement. Borrowed Federal Funds In the second quarter of 2016, the Company decreased its federal funds lines of credit by $121,000 to $125,000. As of June 30, 2016, the Company had $0 outstanding on its $125,000 federal funds lines of credit. As of December 31, 2015 the Company had no outstanding balance on its $257,500 of available credit on these lines. UNIK debt UNIK had approximately $7,149 of debt as of June 30, 2016, and $5,046 of debt as of December 31, 2015. UNIK's debt is comprised of various credit facilities held in Brazil, with various maturity dates. The weighted average annual interest rate was 14.4 percent as of June 30, 2016 and 13.5 percent as of December 31, 2015. This debt is classified in Other debt on the Company’s unaudited condensed consolidated balance sheets for the periods presented. Participation debt During the second quarter of 2014, WEX Bank entered into an agreement with a third party bank to fund customer balances that exceeded WEX Bank's lending limit to an individual customer. During the second quarter of 2016, WEX Bank entered into another agreement with a separate third party bank to increase the funding capacity by $10,000. These borrowings carry a variable interest rate of 1 to 3-month LIBOR plus a margin of 225 basis points. The balance of the debt was $55,000 as of June 30, 2016 and $45,000 as of December 31, 2015 and was secured by an interest in the underlying customer receivables. The participation debt balance will fluctuate on a daily basis based on customer funding needs, and will range from $0 to $55,000. The Company's participation debt agreements will mature on August 1, 2018 and May 31, 2017, respectively. This debt is classified in Other debt on the Company’s unaudited condensed consolidated balance sheets for the periods presented. Australian securitization facility On April 28, 2015, the Company entered into a one year securitized debt agreement with the Bank of Tokyo-Mitsubishi UFJ, Ltd. In April 2016, this agreement was extended for one year. Under the terms of the agreement, each month, on a revolving basis, the Company sells certain of its Australian receivables to Southern Cross WEX 2015-1 Trust, a bankruptcy-remote subsidiary consolidated by the Company (the "Australian Securitization Subsidiary"). The Australian Securitization Subsidiary, in turn, uses the receivables as collateral to issue asset-backed commercial paper ("securitized debt") for approximately 85 percent of the securitized receivables. The amount collected on the securitized receivables is restricted to pay the securitized debt and is not available for general corporate purposes. The Company pays a variable interest rate on the outstanding balance of the securitized debt, based on the Australian Bank Bill Rate plus an applicable margin. The interest rate was 2.70 percent as of June 30, 2016 and 2.91 percent as of December 31, 2015. The Company had $73,327 of securitized debt as of June 30, 2016 and $82,018 of securitized debt as of December 31, 2015. European securitization facility On April 7, 2016, the Company entered into a five year securitized debt agreement with the Bank of Tokyo-Mitsubishi UFJ, Ltd. Under the terms of the agreement, the Company sells certain of its receivables from selected European countries to Gorham Trade Finance B.V., a bankruptcy-remote subsidiary consolidated by the Company (the "European Securitization Subsidiary"). The European Securitization Subsidiary, in turn, uses the receivables as collateral to issue securitized debt. The amount collected on the securitized receivables is restricted to pay the securitized debt and is not available for general corporate purposes. The amounts of receivables to be securitized under this agreement will be determined by management on a monthly basis. This revolving facility has not been utilized as of June 30, 2016. Debt issuance costs The following table presents the Company's net debt issuance costs related to its revolving line-of-credit facilities, term loan and notes outstanding:
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Fair Value |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value |
The Company holds mortgage-backed securities, fixed income and equity securities, derivatives (see Note 8, Derivative Instruments) and certain other financial instruments which are carried at fair value. The Company determines fair value based upon quoted prices when available or through the use of alternative approaches, such as model pricing, when market quotes are not readily accessible or available. In determining the fair value of the Company’s obligations, various factors are considered, including: closing exchange or over-the-counter market price quotations; time value and volatility factors underlying options and derivatives; price activity for equivalent instruments; and the Company’s own credit standing. These valuation techniques may be based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs create the following fair value hierarchy:
The following table presents the Company’s assets that are measured at fair value and the related hierarchy levels as of June 30, 2016:
The following table presents the Company’s assets and liabilities that are measured at fair value and the related hierarchy levels as of December 31, 2015:
The following table presents a reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three months ended June 30, 2015:
The following table presents a reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the six months ended:
$400 Million Notes outstanding The Notes outstanding as of June 30, 2016 have a carrying value of $400,000, less loan origination fees of $4,833, and a fair value of $389,000. As of December 31, 2015 the carrying value of the $400,000 in Notes outstanding, less loan origination fees of $5,200, had a fair value of $366,000. The fair value is based on market rates for the issuance of the Company's debt. The Company determined the fair value of its Notes outstanding are classified as Level 2 in the fair value hierarchy. Available-for-sale securities and executive deferred compensation plan trust When available, the Company uses quoted market prices to determine the fair value of available-for-sale securities; such items are classified in Level 1 of the fair-value hierarchy. These securities primarily consist of exchange-traded equity securities. For mortgage-backed and asset-backed debt securities and bonds, the Company generally uses quoted prices for recent trading activity of assets with similar characteristics to the debt security or bond being valued. The securities and bonds priced using such methods are generally classified as Level 2. The obligations related to the deferred compensation plan trust are classified as Level 1 in the fair value hierarchy because the fair value is determined using quoted prices for identical instruments in active markets. Foreign currency contracts Derivatives include foreign currency forward and swap contracts. The Company's foreign currency forward and swap contracts are valued using an income approach (Level 2) based on the spot rate less the contract rate multiplied by the notional amount. We consider counterparty credit risk in the valuation of the Company's derivatives. However, counterparty credit risk did not impact the valuation of the Company's derivatives during 2016 and 2015. Fuel price derivative instruments The majority of fuel price derivative instruments entered into by the Company were executed over-the-counter and were valued using internal valuation techniques as no quoted market prices exist for such instruments. The valuation technique and inputs depend on the type of derivative and the nature of the underlying instrument. The principal technique used to value these instruments was a comparison of the spot price of the underlying instrument to its related futures curve adjusted for the Company’s assumptions of volatility and present value, where appropriate. The fair values of derivative contracts reflected the expected cash the Company would pay or receive upon settlement of the respective contracts. The key inputs depend upon the type of derivative and the nature of the underlying instrument and include interest rate yield curves, the spot price of the underlying instruments, volatility, and correlation. The item was placed in either Level 2 or Level 3 depending on the observability of the significant inputs to the model. Correlation and inputs with longer tenures are generally less observable. Fuel price derivative instruments – diesel. The assumptions used in the valuation of the diesel fuel price derivative instruments used both observable and unobservable inputs. There is a lack of price transparency with respect to forward prices for diesel fuel. Such unobservable inputs are significant to the diesel fuel derivative contract valuation methodology. After the first quarter of 2016, the Company no longer holds any fuel price derivatives. |
Accumulated Other Comprehensive Income (Loss) |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) |
A reconciliation of accumulated other comprehensive income (loss) for the three month periods ended June 30, 2016 and 2015, is as follows:
A reconciliation of accumulated other comprehensive income (loss) for the six month periods ended June 30, 2016 and 2015, is as follows:
No amounts were reclassified from accumulated other comprehensive income (loss) in the periods presented. The change in foreign currency items is primarily due to the foreign currency translation of non-cash assets such as goodwill and other intangible assets related to the Company's foreign subsidiaries. The total tax effect on accumulated unrealized losses, as of June 30, 2016, was $4,210, and the total tax effect on accumulated unrealized losses, as of June 30, 2015, was $933. |
Non-controlling Interests |
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Noncontrolling Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-controlling Interests |
On August 30, 2012, the Company acquired a 51 percent ownership interest in UNIK. The redeemable non-controlling interest was measured at fair value at the date of acquisition and was reported on the Company’s unaudited condensed consolidated balance sheets as “Redeemable non-controlling interest." On August 31, 2015, the Company acquired the remaining 49 percent ownership in UNIK for $46,018. Due to put rights held by the non-controlling shareholders after the Company's original investment, the non-controlling interest was previously reported as a liability rather than permanent equity. The Company agreed to cancel this put option in conjunction with the acquisition of the remaining 49 percent ownership. The value of the redeemable non-controlling interest was adjusted to the redemption value at date of purchase and the Company recorded the adjustment to retained earnings. This adjustment to retained earnings reduces the Earnings Per Share to shareholders. The Company recorded the amount paid in excess of the redemption value in additional paid-in capital and the impact related to foreign currency in accumulated other comprehensive income. The Company's overall purchase price was less than the fair value of UNIK. A reconciliation of redeemable non-controlling interest for the three and six month periods ended June 30, 2015, is as follows:
On December 1, 2014, WEX acquired the assets of ExxonMobil's Esso portfolio in Europe through its majority owned subsidiary, WEX Europe Services Limited. The Company formed this entity during 2013 and has 75 percent ownership. A reconciliation of non-controlling interest for the three and six month periods ended June 30, 2016 and June 30, 2015 is as follows:
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Income Taxes |
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Jun. 30, 2016 | |||||||
Income Tax Disclosure [Abstract] | |||||||
Income Taxes |
Undistributed earnings of certain foreign subsidiaries of the Company amounted to $21,260 at June 30, 2016, and $13,230 at December 31, 2015. These earnings are considered to be indefinitely reinvested, and accordingly, no U.S. federal and state income taxes have been provided thereon. Upon distribution of these earnings in the form of dividends or otherwise, the Company would be subject to both U.S. income taxes (subject to an adjustment for foreign tax credits) and withholding taxes payable to the various foreign countries. The Company has determined that the amount of taxes attributable to these undistributed earnings is not practicably determinable. |
Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||
Commitments and Contingencies |
Litigation The Company is involved in pending litigation in the ordinary course of business. In the opinion of management, such litigation will not have a material adverse effect on the Company’s unaudited condensed consolidated financial position, results of operations or cash flows. |
Restructuring |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring |
In the first quarter of 2015, the Company commenced a restructuring initiative (the "2015 Restructuring Initiative") as a result of its global review of operations. The global review of operations identified certain initiatives to further streamline the business, improve the Company's efficiency, and to globalize the Company's operations, all with an objective to improve scale and increase profitability going forward. As the Company continued its efforts to improve its overall operational efficiency, the Company began a second restructuring initiative (the "2016 Restructuring Initiative") during the second quarter of 2016. The restructuring expenses related to these initiatives primarily consist of employee costs and office closure costs directly associated with the initiatives. The Company has determined that the amounts of expenses related to these initiatives are probable and estimable and has recorded the impact on the unaudited condensed consolidated statements of income and in Accrued expenses on the unaudited condensed consolidated balance sheet. The balance under the 2015 Restructuring Initiative is expected to be paid through 2017 and the amount under the 2016 Restructuring Initiative is expected to be paid through 2018. The Company expects to incur an additional $3,000 in restructuring costs related to the 2015 Restructuring Initiative and an additional $900 in restructuring costs related to the 2016 Restructuring Initiative. The following table presents the Company's 2015 Restructuring Initiative liability for the three and six months ended June 30, 2016 and 2015:
The following table presents the Company’s 2016 Restructuring Initiative liability for the three and six months ended June 30, 2016:
The following table presents the Company's total restructuring liability for the three and six months ended June 30, 2016 and 2015:
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Segment Information |
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Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information |
Operating segments are defined as components of an enterprise about which separate financial information is available and is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assess performance. The Company’s chief operating decision maker is its Chief Executive Officer. The operating segments are aggregated into the three reportable segments described below. The Company’s chief operating decision maker evaluates the operating results of the Company’s operating and reportable segments based upon revenues and adjusted pre-tax income before NCI which adjusts income before income taxes to exclude fair value changes of fuel price derivative instruments, net foreign currency remeasurement gains and losses, the amortization of acquired intangible assets, the expense associated with stock-based compensation, acquisition related expenses and adjustments, the net impact of tax rate changes on the Company's deferred tax asset and related changes in the tax-receivable agreement, deferred loan costs associated with the extinguishment of debt, certain non-cash asset impairment charges, gains on the extinguishment of a portion of the tax receivable agreement, restructuring charges, gains or losses on divestitures, regulatory reserves and adjustments attributable to non-controlling interests including adjustments to the redemption value of a non-controlling interest. The Fleet Solutions segment provides customers with payment and transaction processing services specifically designed for the needs of commercial and government fleets. This segment also provides information management services to these fleet customers. The Travel and Corporate Solutions segment focuses on the complex payment environment of business-to-business payments, providing customers with payment processing solutions for their corporate payment and transaction monitoring needs. The Health and Employee Benefit Solutions segment provides healthcare payment products and SaaS consumer directed platforms, as well as payroll related benefits to customers in Brazil. Prior to the fourth quarter of 2015, the Company reported its results of operations in two business segments, Fleet Payment Solutions and Other Payment Solutions. During the fourth quarter of 2015, the Company revised its internal and external reporting and reports its results of operations in three reportable segments. The Company has recast the prior year's segment information to conform to the current year presentation. The following table presents the Company's interest income by segment:
Net realized and unrealized losses on derivative instruments are allocated to the Fleet Solutions segment in the computation of segment results for internal evaluation purposes. Total assets are not allocated to the segments. Beginning in the second quarter of 2015, adjusted pre-tax income before NCI excludes net foreign currency gains and losses. For comparative purposes, adjusted pre-tax income before NCI attributable to WEX Inc. for the prior periods has been adjusted to reflect the exclusion of net foreign currency gains and losses and differs from the figure previously reported due to this adjustment. The segment information has also been updated for the three and six month periods ended June 30, 2015 to disaggregate revenue into payment processing, account servicing, finance fee and other revenue in order to provide additional information regarding the Company’s significant revenue streams and to conform to the current year presentation. There was no change to total revenue or other financial information in any of the periods presented as a result of this updated presentation. The following tables present the Company’s reportable segment results on an adjusted pre-tax net income before NCI basis for the three and six months ended June 30, 2016 and 2015:
The following table reconciles income before income taxes to adjusted pre-tax income before NCI:
The Company's adjusted pre-tax income before NCI excludes acquisition and divestiture related items, stock-based compensation, restructuring costs and other costs related to certain outsourcing initiatives, changes in unrealized fuel price derivatives and net foreign currency remeasurement gains and losses. Although adjusted pre-tax income before NCI is not calculated in accordance with GAAP, this non-GAAP measure is integral to the Company's reporting and planning processes and the chief operating decision maker of the Company uses it to allocate resources. The Company considers this measure integral because in the periods prior to the second quarter of 2016, it eliminated the non-cash volatility associated with fuel price related derivative instruments, and it continues to excludes other specified items that the Company's management excludes in evaluating the Company's performance. Specifically, in addition to evaluating the Company's performance on a GAAP basis, management evaluates the Company's performance on a basis that excludes the above items because:
For the same reasons, WEX believes that adjusted pre-tax income before NCI may also be useful to investors as one means of evaluating the Company's performance. However, because adjusted pre-tax income before NCI 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 pre-tax income before NCI as used by WEX may not be comparable to similarly titled measures employed by other companies. |
Supplementary Regulatory Capital Disclosure |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplementary Regulatory Capital Disclosure |
The Company's subsidiary, WEX Bank is subject to various regulatory capital requirements administered by the FDIC and the Utah Department of Financial Institutions. Failure to meet minimum capital requirements can initiate certain mandatory, and possible additional discretionary, actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, WEX Bank must meet specific capital guidelines that involve quantitative measures of WEX Bank’s assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. WEX Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Quantitative measures established by regulation to ensure capital adequacy require WEX Bank to maintain minimum amounts and ratios as defined in the regulations. As of December 31, 2015, the most recent FDIC exam report categorized WEX Bank as “well capitalized” under the regulatory framework for prompt corrective action. There are no conditions or events subsequent to that examination report that management believes have changed WEX Bank’s capital rating. WEX Bank’s actual and regulatory minimum capital amounts and ratios as of June 30, 2016 are presented in the following table:
WEX Bank's actual and regulatory minimum capital amounts and ratios as of December 31, 2015 are presented in the following table:
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Subsequent Events |
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Jun. 30, 2016 | |||||||||||||||||||||||||||
Subsequent Events [Abstract] | |||||||||||||||||||||||||||
Subsequent Events |
Acquisition of EFS On July 1, 2016 the Company completed the acquisition of EFS, a provider of customized corporate payment solutions for fleet and corporate customers with a focus on the large and mid-sized over-the-road fleet segments. In consideration for the acquisition of EFS, the Company issued 4,012 shares of its common stock valued at approximately $356,000 based on the closing price of the Company's common stock on the New York Stock Exchange as of June 30, 2016, representing approximately 9.4% of the Company's outstanding common stock after giving effect to the issuance of the new shares in connection with this acquisition. The cash consideration for the transaction totaled approximately $1,100,000, and was funded with amounts received under the 2016 Credit Agreement described below. The value of the total cash and stock consideration paid for the acquisition of EFS was approximately $1,456,000. This acquisition will enable the combined company to expand its presence in the large and mid-sized over-the-road fleet segment while better serving the needs of all fleets. The Company expects the transaction to be dilutive on a GAAP basis over the next 12 months. EFS had approximately $135,000 in revenues for the year ended December 31, 2015. The EFS acquisition will be accounted under the acquisition method of accounting in accordance with ASC 805 Business Combinations. Currently the Company is in the process of determining the total purchase consideration transferred, fair value of tangible and intangible assets acquired and liabilities assumed, and related purchase price allocation. On a preliminary basis, a significant portion of purchase consideration is expected to be allocated to intangible assets which include but are not limited to software technology, customer relationships, other intangible assets and goodwill. Goodwill is expected to be partially deductible for tax purposes. 2016 Credit Agreement On July 1, 2016, the Company entered into the 2016 Credit Agreement, which replaced the 2014 Credit Agreement. The 2016 Credit Agreement provides for a tranche A term loan facility in an amount equal to $455,000 that matures on July 1, 2021, a tranche B term loan facility in an amount equal to $1,200,000 that matures on July 1, 2023, and a $470,000 secured revolving credit facility, with a $250,000 sublimit for letters of credit and a $20,000 sublimit for swingline loans, that terminates on July 1, 2021. Additional loans of up to the greater of $375,000 (plus the amount of certain prepayments) and an unlimited amount subject to satisfaction of a consolidated leverage ratio test of 4.00 to 1.00 may be made available under the 2016 Credit Agreement upon request of the Company subject to specified terms and conditions, including receipt of lender commitments. Proceeds from the 2016 Credit Agreement may be used for working capital purposes, acquisitions, payment of dividends and other restricted payments, refinancing of indebtedness, and other general corporate purposes. Amounts outstanding under the 2016 Credit Agreement bear interest at a rate equal to, at the Company’s option, (a) the Eurocurrency Rate, as defined in the 2016 Credit Agreement, plus a margin of between 1.75% to 3.25% (initially 3.25%) with respect to the tranche A term loan facility and the revolving credit facility and between 3.25% to 3.50% (initially 3.50%) with respect to the tranche B term loan facility (with the Eurocurrency Rate subject to a 0.75% floor in the case of the tranche B term loan facility and a 0.0% floor in the case of the tranche A term loan and revolving credit facility), in each case, based on the ratio of consolidated funded indebtedness of the Company and its subsidiaries to consolidated EBITDA or (b) the highest of (i) the Federal Funds Rate plus 0.50%, (ii) the prime rate announced by Bank of America, and (iii) the Eurocurrency Rate plus 1.00%, in each case plus a margin of 0.75% to 2.25% (initially 2.25%) with respect to the tranche A term loan facility and the revolving credit facility or 2.25% to 2.50% (initially 2.50%) with respect to the tranche B term loan facility, in each case, based on the ratio of consolidated funded indebtedness of the Company and its subsidiaries to consolidated EBITDA. In addition, the Company has agreed to pay a quarterly commitment fee at a rate per annum ranging from 0.30% to 0.50% (initially 0.50%) based on the ratio of consolidated funded indebtedness of the Company and its subsidiaries to consolidated EBITDA of the daily unused portion of the 2016 Credit Agreement. The tranche B term loan facility was issued with original issue discount of 1.00%. The 2016 Credit Agreement requires the Company to prepay outstanding term loans, subject to certain exceptions, with:
The Company may voluntarily prepay outstanding loans from time to time, subject to certain conditions, without premium or penalty other than customary “breakage” costs with respect to Eurocurrency Rate loans, provided, however, that if on or prior to the date that is twelve (12) months following the closing date, the Company prepays any loans under the tranche B term loan facility in connection with a repricing transaction, the Company must pay a prepayment premium of 1.00% of the aggregate principal amount of the tranche B term loans so prepaid. The Company is required to make scheduled quarterly payments each equal to 1.25% in the case of the tranche A term loan facility, and 0.25% in the case of the tranche B term loan facility, of the original principal amount of the respective term loans made on the closing date, with the balance due at maturity. The 2016 Credit Agreement contains customary representations and warranties, as well as affirmative and negative covenants. The 2016 Credit Agreement also requires, solely for the benefit of the lenders under the tranche A term loan facility and the revolving credit facility, that the Company maintain at the end of each fiscal quarter the following financial ratios:
The obligations under the 2016 Credit Agreement are secured by a security interest in, subject to certain exceptions, substantially all of the assets of the Company pursuant to the terms of a U.S. Security Agreement, dated as of July 1, 2016, in favor of Bank of America, as collateral agent for the lenders. On July 1, 2016, the Company borrowed the entire principal amount of the tranche A term loan facility, the entire principal amount of the tranche B term loan facility and $220,000 under the revolving credit facility to pay the cash portion of the purchase price for the acquisition of EFS, repay EFS's outstanding credit facilities, repay amounts outstanding under the 2014 Credit Agreement, and pay related fees, expenses and other transaction costs, as well as for working capital and other general corporate purposes. The total initial borrowing on July 1, 2016 was $1,875,000 and the total borrowing capacity under the 2016 Credit Agreement is $2,125,000. On July 1, 2016, concurrently with the financing transactions discussed above, the Company repaid in full all outstanding amounts under the 2014 Credit Agreement and terminated all commitments by the lenders to extend further credit thereunder and all guarantees and security interests granted by the Company to the lenders thereunder. The Company did not incur any early termination penalties in connection with the termination of the 2014 Credit Agreement. |
New Accounting Standards (Policies) |
6 Months Ended |
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Jun. 30, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Standards | In May 2014, the FASB issued ASU 2014-09 related to revenue recognition, which will supersede most existing revenue recognition guidance under U.S. GAAP. The new revenue recognition standard requires entities to recognize revenue for the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard permits the use of either the retrospective or cumulative effect transition method. On July 9, 2015, the Board voted to defer the effective date by one year to interim and annual reporting periods beginning after December 15, 2017, and permitted early adoption of the standard, but not for periods beginning on or before the original effective date of December 15, 2016. In March 2016, the FASB issued ASU 2016-08, in April 2016, the FASB issued ASU 2016-10, and in May 2016, the FASB issued ASU 2016-12, in each case to clarify the implementation guidance on the new revenue recognition standard. The effective dates for these standards are the same as the effective date for ASU 2014-09. The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures and has not yet selected a transition method. In September 2015, the FASB issued ASU 2015-16 related to simplifying the accounting for measurement period adjustments. This standard replaces the requirement that an acquirer in a business combination account for measurement period adjustments retrospectively with a requirement that an acquirer recognize adjustments to the provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The acquirer is required to record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. The guidance is to be applied prospectively to adjustments to provisional amounts that occur after the effective date of the guidance. The Company adopted this standard on January 1, 2016. In January 2016, the FASB issued ASU 2016-01 related to accounting for equity investments. The pronouncement requires equity investments, except those accounted for under the equity method of accounting, or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income. The standard is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The Company is currently evaluating the impact the pronouncement will have on the consolidated financial statements and related disclosures. In February 2016, the FASB issued ASU 2016-02 to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. When transitioning, the standard requires leases to be recognized and measured at the beginning of the earliest period presented using a modified retrospective approach. Certain qualitative and quantitative disclosures are required. The standard is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period. The Company is currently evaluating the impact the standard will have on the consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU 2016-09 to simplify several aspects of accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, statutory tax withholding requirements, and classification in the statement of cash flows. The standard is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. The Company is currently evaluating the impact the standard will have on the consolidated financial statements and related disclosures. In June 2016, the FASB issued ASU 2016-13 which requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. This amount will be based on historical experience, current conditions, and reasonable and supportable forecasts that impact the collectability of the reported amount. The standard is effective for annual reporting periods beginning after December 15, 2019, including interim periods within those fiscal years. The Company is currently evaluating the impact the standard will have on the consolidated financial statements and related disclosures. |
Basis of Presentation (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Glossary of Terms in Document | The following is provided to aid the reader and provide a reference point when reviewing the unaudited condensed consolidated financial statements.
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Schedule of Error Corrections and Prior Period Adjustments | As a result of the adoption, the December 31, 2015 unaudited condensed consolidated balance sheet is restated as follows:
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Business Acquisitions (Tables) |
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Benaissance Acquisition | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Business Acquisitions, by Acquisition | The following is a summary of the final allocation of the purchase price to the assets and liabilities acquired:
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Reserves for Credit Losses (Tables) |
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Reserves for Credit Losses Related to Accounts Receivable | The following table presents changes in reserves for credit losses related to accounts receivable:
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Goodwill and Other Intangible Assets (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Goodwill | The changes in goodwill during the first six months of 2016 were as follows:
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Changes in Other Intangible Assets | The changes in other intangible assets during the first six months of 2016 were as follows:
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Estimated Amortization Expense Related to Definite Lived Intangible Assets | The following table presents the estimated amortization expense related to the definite-lived intangible assets listed above for the remainder of 2016 and for each of the five succeeding fiscal years:
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Other Intangible Assets | Other intangible assets, net consist of the following:
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Earnings per Share (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Income and Share Data Used in Basic and Diluted Earnings Per Share Computations | The following is a reconciliation of the income and share data used in the basic and diluted earnings per share computations for the three and six months ended June 30, 2016 and 2015:
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Derivative Instruments (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Location and Amounts of Derivative Gains and Losses in Condensed Consolidated Statements of Income | The following table presents information on the location and amounts of derivative gains and losses in the unaudited condensed consolidated statements of income:
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Location and Amounts of Derivative Fair Values in Condensed Consolidated Balance Sheets | The following table presents information on the location and amounts of derivative fair values in the unaudited condensed consolidated balance sheets:
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Financing and Other Debt (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||
Schedule of Debt Issuance Costs | The following table presents the Company's net debt issuance costs related to its revolving line-of-credit facilities, term loan and notes outstanding:
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Fair Value (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets and Liabilities Measured at Fair Value | The following table presents the Company’s assets that are measured at fair value and the related hierarchy levels as of June 30, 2016:
The following table presents the Company’s assets and liabilities that are measured at fair value and the related hierarchy levels as of December 31, 2015:
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Reconciliation of Beginning and Ending Balances for Assets and Liabilities Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs | The following table presents a reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three months ended June 30, 2015:
The following table presents a reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the six months ended:
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Accumulated Other Comprehensive Loss (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Accumulated Other Comprehensive Income | A reconciliation of accumulated other comprehensive income (loss) for the three month periods ended June 30, 2016 and 2015, is as follows:
A reconciliation of accumulated other comprehensive income (loss) for the six month periods ended June 30, 2016 and 2015, is as follows:
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Non-controlling Interests (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Redeemable Noncontrolling Interest | A reconciliation of redeemable non-controlling interest for the three and six month periods ended June 30, 2015, is as follows:
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Summary of Noncontrolling Interests | A reconciliation of non-controlling interest for the three and six month periods ended June 30, 2016 and June 30, 2015 is as follows:
|
Restructuring (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Costs | The following table presents the Company's 2015 Restructuring Initiative liability for the three and six months ended June 30, 2016 and 2015:
The following table presents the Company’s 2016 Restructuring Initiative liability for the three and six months ended June 30, 2016:
The following table presents the Company's total restructuring liability for the three and six months ended June 30, 2016 and 2015:
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Segment Information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest Income | The following table presents the Company's interest income by segment:
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Reportable Segment Results | The following tables present the Company’s reportable segment results on an adjusted pre-tax net income before NCI basis for the three and six months ended June 30, 2016 and 2015:
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Reconciliation of Adjusted Net Income to Net Income | The following table reconciles income before income taxes to adjusted pre-tax income before NCI:
|
Supplementary Regulatory Capital Disclosure (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations | WEX Bank’s actual and regulatory minimum capital amounts and ratios as of June 30, 2016 are presented in the following table:
WEX Bank's actual and regulatory minimum capital amounts and ratios as of December 31, 2015 are presented in the following table:
|
Business Acquisitions - Additional Information UNIK Acquisition (Details) - Unik - USD ($) $ in Thousands |
Aug. 31, 2015 |
Aug. 30, 2012 |
---|---|---|
Business Acquisition [Line Items] | ||
Percent of ownership interest acquired | 49.00% | 51.00% |
Noncontrolling interest, decrease from redemptions or purchase of interests | $ 46,018 |
Sale of Subsidiary and Assets - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jan. 07, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Net foreign currency remeasurement gain/loss | $ 0 | $ 0 | $ 0 | $ 1,215 | |
Rapid! Paycard | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Proceeds from sale of subsidiary | $ 20,000 | ||||
Net foreign currency remeasurement gain/loss | $ 1,215 |
Reserves for Credit Losses - Additional Information (Detail) $ in Thousands |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2016
USD ($)
customer
|
Dec. 31, 2015
USD ($)
|
Jun. 30, 2015 |
|
Concentration Risk [Line Items] | |||
Trade receivable payments terms (30 days or less) | 30 days | ||
Threshold Period Past Due for Write-off of Trade Accounts Receivable | 150 days | ||
Percentage of trade receivables outstanding balance, current | 92.00% | 91.00% | |
Percentage of trade accounts receivables less than 60 days past due | 98.00% | 98.00% | |
Customer Concentration Risk | Accounts Receivable | |||
Concentration Risk [Line Items] | |||
Concentration risk, number of customers | customer | 0 | ||
Revolving Credit Facility | |||
Concentration Risk [Line Items] | |||
Loans Receivable, Net | $ | $ 1,900 | $ 1,100 |
Reserves for Credit Losses - Changes in Reserves for Credit Losses Related to Accounts Receivable (Detail) - USD ($) $ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Allowance for Doubtful Accounts Receivable [Roll Forward] | ||
Balance, beginning of period | $ 13,832 | $ 13,919 |
Provision for credit losses | 10,360 | 7,897 |
Charge-offs | (13,681) | (15,019) |
Recoveries of amounts previously charged-off | 2,476 | 2,931 |
Currency translation | 77 | (63) |
Balance, end of period | $ 13,064 | $ 9,665 |
Goodwill and Other Intangible Assets - Changes In Goodwill (Detail) - USD ($) $ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Dec. 31, 2015 |
|
Goodwill [Roll Forward] | ||
Gross goodwill, January 1, 2016 | $ 1,130,386 | |
Impact of foreign currency translation | 5,668 | |
Acquisition adjustments | 502 | |
Gross goodwill, June 30, 2016 | 1,136,556 | |
Accumulated impairment, June 30, 2016 | (17,508) | |
Net goodwill, June 30, 2016 | 1,119,048 | $ 1,112,878 |
Fleet Solutions Segment | ||
Goodwill [Roll Forward] | ||
Gross goodwill, January 1, 2016 | 736,240 | |
Impact of foreign currency translation | 4,285 | |
Acquisition adjustments | 0 | |
Gross goodwill, June 30, 2016 | 740,525 | |
Accumulated impairment, June 30, 2016 | (1,337) | |
Net goodwill, June 30, 2016 | 739,188 | |
Travel and Corporate Solutions Segment | ||
Goodwill [Roll Forward] | ||
Gross goodwill, January 1, 2016 | 43,825 | |
Impact of foreign currency translation | (1,712) | |
Acquisition adjustments | 0 | |
Gross goodwill, June 30, 2016 | 42,113 | |
Accumulated impairment, June 30, 2016 | (16,171) | |
Net goodwill, June 30, 2016 | 25,942 | |
Health and Employee Benefit Solutions Segment | ||
Goodwill [Roll Forward] | ||
Gross goodwill, January 1, 2016 | 350,321 | |
Impact of foreign currency translation | 3,095 | |
Acquisition adjustments | 502 | |
Gross goodwill, June 30, 2016 | 353,918 | |
Accumulated impairment, June 30, 2016 | 0 | |
Net goodwill, June 30, 2016 | $ 353,918 |
Goodwill and Other Intangible Assets - Additional Information (Detail) |
6 Months Ended |
---|---|
Jun. 30, 2016
USD ($)
| |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill impairment | $ 0 |
Goodwill and Other Intangible Assets - Changes in Intangible Assets (Detail) $ in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2016
USD ($)
| |
Definite-lived intangible assets | |
Net Carrying Amount, January 1, 2016 | $ 453,336 |
Amortization | (25,212) |
Net Carrying Amount, June 30, 2016 | 431,224 |
Indefinite-lived intangible assets | |
Net Carrying Amount, January 1, 2016 | 470,712 |
Disposals | 0 |
Impact of foreign currency translation | 3,185 |
Net Carrying Amount, June 30, 2016 | 448,685 |
Acquired software and developed technology | |
Definite-lived intangible assets | |
Net Carrying Amount, January 1, 2016 | 114,012 |
Amortization | (6,367) |
Disposals | 0 |
Impact of foreign currency translation | 520 |
Net Carrying Amount, June 30, 2016 | 108,165 |
Customer relationships | |
Definite-lived intangible assets | |
Net Carrying Amount, January 1, 2016 | 297,904 |
Amortization | (15,544) |
Disposals | 0 |
Impact of foreign currency translation | 2,050 |
Net Carrying Amount, June 30, 2016 | 284,410 |
Licensing agreements | |
Definite-lived intangible assets | |
Net Carrying Amount, January 1, 2016 | 27,398 |
Amortization | (2,549) |
Disposals | 0 |
Impact of foreign currency translation | 521 |
Net Carrying Amount, June 30, 2016 | 25,370 |
Patent | |
Definite-lived intangible assets | |
Net Carrying Amount, January 1, 2016 | 878 |
Amortization | (98) |
Disposals | 0 |
Impact of foreign currency translation | 7 |
Net Carrying Amount, June 30, 2016 | 787 |
Trademarks and trade names | |
Definite-lived intangible assets | |
Net Carrying Amount, January 1, 2016 | 13,144 |
Amortization | (654) |
Disposals | 0 |
Impact of foreign currency translation | 2 |
Net Carrying Amount, June 30, 2016 | 12,492 |
Trademarks and trade names | |
Definite-lived intangible assets | |
Net Carrying Amount, January 1, 2016 | 13,144 |
Net Carrying Amount, June 30, 2016 | 12,492 |
Indefinite-lived intangible assets | |
Net Carrying Amount, January 1, 2016 | 17,376 |
Impact of foreign currency translation | 85 |
Net Carrying Amount, June 30, 2016 | $ 17,461 |
Goodwill and Other Intangible Assets - Estimated Amortization Expense Related to Definite Lived Intangible Assets (Detail) $ in Thousands |
Jun. 30, 2016
USD ($)
|
---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remaining 2016 | $ 25,404 |
2017 | 51,191 |
2018 | 47,232 |
2019 | 43,416 |
2020 | 39,939 |
2021 | $ 35,890 |
Goodwill and Other Intangible Assets - Other Intangible Assets (Detail) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount, Definite-lived intangible assets | $ 615,060 | $ 609,290 |
Accumulated Amortization, Definite-lived intangible assets | (183,836) | (155,954) |
Net Carrying Amount, Definite-lived intangible assets | 431,224 | 453,336 |
Other intangible assets, net | 448,685 | 470,712 |
Trademarks and trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount, Definite-lived intangible assets | 16,430 | 16,410 |
Accumulated Amortization, Definite-lived intangible assets | (3,938) | (3,266) |
Net Carrying Amount, Definite-lived intangible assets | 12,492 | 13,144 |
Net Carrying Amount, Indefinite-lived intangible assets | 17,461 | 17,376 |
Acquired software and developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount, Definite-lived intangible assets | 156,285 | 155,182 |
Accumulated Amortization, Definite-lived intangible assets | (48,120) | (41,170) |
Net Carrying Amount, Definite-lived intangible assets | 108,165 | 114,012 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount, Definite-lived intangible assets | 407,402 | 403,382 |
Accumulated Amortization, Definite-lived intangible assets | (122,992) | (105,478) |
Net Carrying Amount, Definite-lived intangible assets | 284,410 | 297,904 |
Licensing agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount, Definite-lived intangible assets | 32,482 | 31,903 |
Accumulated Amortization, Definite-lived intangible assets | (7,112) | (4,505) |
Net Carrying Amount, Definite-lived intangible assets | 25,370 | 27,398 |
Patent | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount, Definite-lived intangible assets | 2,461 | 2,413 |
Accumulated Amortization, Definite-lived intangible assets | (1,674) | (1,535) |
Net Carrying Amount, Definite-lived intangible assets | $ 787 | $ 878 |
Earnings per Share - Reconciliation of Income and Share Data Used in Basic and Diluted Earnings Per Share Computations (Detail) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Earnings Per Share [Abstract] | ||||
Net earnings attributable to WEX Inc. available for common stockholders – Basic and Diluted | $ 12,567 | $ 26,492 | $ 35,653 | $ 48,837 |
Weighted average common shares outstanding – Basic (in shares) | 38,806 | 38,739 | 38,781 | 38,798 |
Unvested restricted stock units (in shares) | 36 | 43 | 54 | 65 |
Stock options (in shares) | 15 | 17 | 15 | 17 |
Weighted average common shares outstanding – Diluted (in shares) | 38,857 | 38,799 | 38,850 | 38,880 |
Earnings per Share - Stock Options and Restricted Stock Units (Details) - shares shares in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Employee Stock Option | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 0 | 0 | 0 |
Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 0 | 0 | 0 |
Derivative Instruments - Fuel Derivative Program (Details) |
Mar. 31, 2016 |
---|---|
Price Risk Derivative | |
Derivative [Line Items] | |
Percentage hedged by fuel price derivatives | 20.00% |
Derivative Instruments - Location and Amounts of Derivative Gains and Losses in Condensed Consolidated Statements of Income (Detail) - Derivatives Not Designated as Hedging Instruments - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Commodity contracts | Net realized and unrealized (loss) gain on fuel price derivatives | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain or (Loss) Recognized in Income on Derivative | $ 0 | $ (6,000) | $ 711 | $ (3,251) |
Foreign currency contracts | Net foreign currency gain (loss) | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain or (Loss) Recognized in Income on Derivative | $ 73 | $ (5,838) | $ 39 | $ 21,967 |
Derivative Instruments - Location and Amounts of Derivative Fair Values in Condensed Consolidated Balance Sheets (Detail) - Derivatives Not Designated as Hedging Instruments $ in Thousands |
Dec. 31, 2015
USD ($)
|
---|---|
Commodity contracts | Fuel price derivatives, at fair value | |
Derivatives, Fair Value [Line Items] | |
Derivatives Classified as Assets | $ 5,007 |
Derivatives Classified as Liabilities | 0 |
Foreign currency contracts | |
Derivatives, Fair Value [Line Items] | |
Derivatives Classified as Assets | 0 |
Derivatives Classified as Liabilities | $ 90 |
Financing and Other Debt - Additional Information (Detail) - USD ($) |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Apr. 07, 2016 |
Apr. 28, 2015 |
Jun. 30, 2016 |
Jun. 30, 2016 |
Dec. 31, 2015 |
|
Debt Instrument [Line Items] | |||||
Lines of credit | $ 727,639,000 | $ 727,639,000 | $ 664,918,000 | ||
Maximum borrowing capacity | 125,000,000 | 125,000,000 | 257,500,000 | ||
Increase (decrease), net | 121,000,000 | ||||
Securitized debt | 73,327,000 | 73,327,000 | 82,018,000 | ||
Electronic Funds Source LLC | |||||
Debt Instrument [Line Items] | |||||
Lines of credit | 2,125,000,000 | 2,125,000,000 | |||
Unik | |||||
Debt Instrument [Line Items] | |||||
Outstanding debt | $ 7,149,000 | $ 7,149,000 | $ 5,046,000 | ||
Weighted average annual interest rate, percent | 14.40% | 14.40% | 13.50% | ||
Line of Credit | |||||
Debt Instrument [Line Items] | |||||
Lines of credit | $ 0 | $ 0 | |||
Maximum borrowing capacity | $ 125,000,000 | $ 125,000,000 | |||
2014 Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Leverage ratio | 3.25 | 3.25 | |||
2014 Credit Agreement | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Lines of credit | $ 282,639,000 | $ 282,639,000 | |||
Maximum borrowing capacity | 700,000,000 | $ 700,000,000 | |||
2014 Credit Agreement | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | |||||
Debt Instrument [Line Items] | |||||
Margin on variable rate, percent | 2.00% | ||||
2014 Credit Agreement | Revolving Credit Facility | Prime Rate | |||||
Debt Instrument [Line Items] | |||||
Margin on variable rate, percent | 1.00% | ||||
2014 Credit Agreement | Revolving Credit Facility | Eurocurrency Rate | |||||
Debt Instrument [Line Items] | |||||
Margin on variable rate, percent | 2.00% | ||||
2014 Credit Agreement | Credit Facility Term Loans | |||||
Debt Instrument [Line Items] | |||||
Lines of credit | 445,000,000 | $ 445,000,000 | $ 458,750,000 | ||
2014 Credit Agreement | Credit Facility Term Loans | London Interbank Offered Rate (LIBOR) | |||||
Debt Instrument [Line Items] | |||||
Margin on variable rate, percent | 2.00% | ||||
Loan Participations and Assignments | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Increase (Decrease) in Maximum Borrowing Capacity, Amount | 10,000,000 | $ 10,000,000 | |||
Debt instrument, aggregate principal amount | 55,000,000 | 55,000,000 | $ 45,000,000 | ||
Loan Participations and Assignments | Minimum | |||||
Debt Instrument [Line Items] | |||||
Range of daily balance | 0 | 0 | |||
Loan Participations and Assignments | Maximum | |||||
Debt Instrument [Line Items] | |||||
Range of daily balance | 55,000,000 | $ 55,000,000 | |||
Loan Participations and Assignments | London Interbank Offered Rate (LIBOR) | |||||
Debt Instrument [Line Items] | |||||
Margin on variable rate, percent | 2.25% | ||||
Securitization Facility | |||||
Debt Instrument [Line Items] | |||||
Term of securitization facility | 1 year | ||||
Securitization facility, percentage of receivables used as collateral | 85.00% | ||||
Interest rate during period, percent | 2.70% | 2.91% | |||
European Securitization Facility | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Term | 5 years | ||||
Interest Expense | Electronic Funds Source LLC | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, commitment fee amount | $ 19,545,000 | $ 30,045,000 | |||
June 30, 2016 | Second Amendment to 2014 Agreement | |||||
Debt Instrument [Line Items] | |||||
Leverage ratio | 3.75 | 3.75 | |||
September 30, 2016 | Second Amendment to 2014 Agreement | |||||
Debt Instrument [Line Items] | |||||
Leverage ratio | 3.75 | 3.75 | |||
December 31, 2016 | Second Amendment to 2014 Agreement | |||||
Debt Instrument [Line Items] | |||||
Leverage ratio | 3.50 | 3.50 |
Financing and Other Debt - Schedule of Debt Issuance Cost (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Notes outstanding | ||
Line of Credit Facility [Line Items] | ||
Debt Issuance Costs, Net | $ 4,833 | $ 5,200 |
Revolving line of credit facilities and term loan | ||
Line of Credit Facility [Line Items] | ||
Debt Issuance Costs, Net | $ 3,661 | $ 4,837 |
Fair Value - Assets and Liabilities Measured at Fair Value and Related Hierarchy Levels (Detail) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
|||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Assets: | |||||||||||||
Total available-for-sale securities | $ 24,405 | $ 18,562 | |||||||||||
Executive deferred compensation plan trust | 5,514 | [1] | 5,655 | [2] | |||||||||
Fuel price derivatives | 5,007 | ||||||||||||
Liabilities: | |||||||||||||
Foreign currency swaps | [3] | 90 | |||||||||||
Mortgage-backed securities | |||||||||||||
Assets: | |||||||||||||
Total available-for-sale securities | 629 | 650 | |||||||||||
Asset-backed securities | |||||||||||||
Assets: | |||||||||||||
Total available-for-sale securities | 736 | 848 | |||||||||||
Municipal bonds | |||||||||||||
Assets: | |||||||||||||
Total available-for-sale securities | 793 | 398 | |||||||||||
Equity securities | |||||||||||||
Assets: | |||||||||||||
Total available-for-sale securities | 22,247 | 16,666 | |||||||||||
Fuel price derivatives - unleaded fuel | |||||||||||||
Assets: | |||||||||||||
Fuel price derivatives | [4] | 3,083 | |||||||||||
Fuel price derivatives – diesel | |||||||||||||
Assets: | |||||||||||||
Fuel price derivatives | [4] | 1,924 | |||||||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||||||||||||
Assets: | |||||||||||||
Total available-for-sale securities | 22,247 | 16,666 | |||||||||||
Executive deferred compensation plan trust | 5,514 | [1] | 5,655 | [2] | |||||||||
Liabilities: | |||||||||||||
Foreign currency swaps | [3] | 0 | |||||||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Equity securities | |||||||||||||
Assets: | |||||||||||||
Total available-for-sale securities | 22,247 | 16,666 | |||||||||||
Significant Other Observable Inputs (Level 2) | |||||||||||||
Assets: | |||||||||||||
Total available-for-sale securities | 2,158 | 1,896 | |||||||||||
Fuel price derivatives | 3,083 | ||||||||||||
Liabilities: | |||||||||||||
Foreign currency swaps | [3] | 90 | |||||||||||
Significant Other Observable Inputs (Level 2) | Mortgage-backed securities | |||||||||||||
Assets: | |||||||||||||
Total available-for-sale securities | 629 | 650 | |||||||||||
Significant Other Observable Inputs (Level 2) | Asset-backed securities | |||||||||||||
Assets: | |||||||||||||
Total available-for-sale securities | 736 | 848 | |||||||||||
Significant Other Observable Inputs (Level 2) | Municipal bonds | |||||||||||||
Assets: | |||||||||||||
Total available-for-sale securities | $ 793 | 398 | |||||||||||
Significant Other Observable Inputs (Level 2) | Fuel price derivatives - unleaded fuel | |||||||||||||
Assets: | |||||||||||||
Fuel price derivatives | [4] | 3,083 | |||||||||||
Significant Unobservable Inputs (Level 3) | |||||||||||||
Assets: | |||||||||||||
Fuel price derivatives | 1,924 | ||||||||||||
Liabilities: | |||||||||||||
Foreign currency swaps | [3] | 0 | |||||||||||
Significant Unobservable Inputs (Level 3) | Fuel price derivatives – diesel | |||||||||||||
Assets: | |||||||||||||
Fuel price derivatives | [4] | $ 1,924 | |||||||||||
|
Fair Value - Reconciliation of Beginning and Ending Balances for Assets (Liabilities) Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs (Level Three) (Detail) - Fuel price derivatives – diesel - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
||||||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||||||||
Beginning balance | $ 10,261 | $ 1,924 | $ 11,848 | |||||||
Total gains and (losses) – realized/unrealized | ||||||||||
Included in earnings | (4,183) | [1] | (1,924) | [2] | (5,770) | [2] | ||||
Included in other comprehensive income | 0 | 0 | 0 | |||||||
Purchases, issuances and settlements | 0 | 0 | 0 | |||||||
Transfers (in)/out of Level 3 | 0 | 0 | 0 | |||||||
Ending balance | $ 6,078 | $ 0 | $ 6,078 | |||||||
|
Fair Value - Additional Information (Detail) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Fair Value Disclosures [Abstract] | ||
Notes, loans and financing receivable, gross, noncurrent | $ 400,000 | $ 400,000 |
Debt instrument, fee amount | 4,833 | 5,200 |
Notes outstanding, fair value | $ 389,000 | $ 366,000 |
Accumulated Other Comprehensive Income (Loss) - Reconciliation of Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Beginning balance | $ (103,451) | |||
Ending balance | $ (104,020) | (104,020) | ||
Unrealized Gains and Losses on Available- for-Sale Securities | ||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Beginning balance | (48) | $ (38) | (212) | $ (129) |
Other comprehensive income (loss) | 107 | (140) | 271 | (49) |
Ending balance | 59 | (178) | 59 | (178) |
Accumulated Other Comprehensive Income (Loss), Tax | 4,210 | 933 | 4,210 | 933 |
Foreign Currency Items | ||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Beginning balance | (92,921) | (75,135) | (103,239) | (50,452) |
Other comprehensive income (loss) | (11,158) | 7,791 | (840) | (16,892) |
Ending balance | $ (104,079) | $ (67,344) | $ (104,079) | $ (67,344) |
Non-controlling Interests - Additional Information (Detail) - USD ($) $ in Thousands |
Aug. 31, 2015 |
Jun. 30, 2016 |
Aug. 30, 2012 |
---|---|---|---|
Unik | |||
Noncontrolling Interest [Line Items] | |||
Percent of ownership interest acquired | 49.00% | 51.00% | |
Noncontrolling interest, decrease from redemptions or purchase of interests | $ 46,018 | ||
WEX Europe Services | |||
Noncontrolling Interest [Line Items] | |||
Percent of ownership interest acquired | 75.00% |
Non-controlling Interests - Redeemable Noncontrolling Interests (Detail) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Reconcilliation of Redeemable Noncontrolling Interest [Roll Forward] | ||||
Balance, beginning of period | $ 13,647 | $ 16,590 | ||
Net income attributable to redeemable non-controlling interest | 670 | 659 | ||
Currency translation adjustment | 675 | (2,257) | ||
Ending balance | 14,992 | 14,992 | ||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Balance, beginning of period | $ 12,437 | |||
Net loss attributable to non-controlling interest | $ (655) | (92) | (520) | (2,404) |
Ending balance | 12,052 | 12,052 | ||
WEX Europe Services | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Balance, beginning of period | 13,028 | 13,644 | 12,437 | 17,396 |
Net loss attributable to non-controlling interest | (655) | (762) | (520) | (3,063) |
Currency translation adjustment | (321) | 283 | 135 | (1,168) |
Ending balance | $ 12,052 | $ 13,165 | $ 12,052 | $ 13,165 |
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Income Tax Disclosure [Abstract] | ||
Undistributed earnings of certain foreign subsidiaries | $ 21,260 | $ 13,230 |
Restructuring - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Restructuring Reserve | ||||
Beginning balance | $ 8,506 | $ 8,559 | $ 7,249 | $ 0 |
Restructuring charges | 3,506 | 0 | 5,095 | 8,559 |
Cash paid | (1,478) | 0 | (2,125) | 0 |
Impact of foreign currency translation | 39 | 263 | 354 | 263 |
Ending balance | 10,573 | 8,822 | 10,573 | 8,822 |
Year 2015 | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring expected cost | 3,000 | 3,000 | ||
Restructuring Reserve | ||||
Beginning balance | 8,506 | 8,559 | 7,249 | 0 |
Restructuring charges | 0 | 0 | 1,589 | 8,559 |
Cash paid | (1,478) | 0 | (2,125) | 0 |
Impact of foreign currency translation | 57 | 263 | 372 | 263 |
Ending balance | 7,085 | $ 8,822 | 7,085 | $ 8,822 |
Year 2016 | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring expected cost | 900 | 900 | ||
Restructuring Reserve | ||||
Beginning balance | 0 | 0 | ||
Restructuring charges | 3,506 | 3,506 | ||
Cash paid | 0 | 0 | ||
Impact of foreign currency translation | (18) | (18) | ||
Ending balance | $ 3,488 | $ 3,488 |
Segment Information - Additional Information (Detail) - Segment |
3 Months Ended | 6 Months Ended | 9 Months Ended |
---|---|---|---|
Dec. 31, 2015 |
Jun. 30, 2016 |
Sep. 30, 2015 |
|
Segment Reporting [Abstract] | |||
Number of reportable segments | 3 | 3 | 2 |
Segment Information - Reportable Segment Results (Detail) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Segment Reporting Information [Line Items] | ||||
Interest Income | $ 2,685 | $ 1,467 | $ 5,155 | $ 3,382 |
Fleet Solutions Segment | ||||
Segment Reporting Information [Line Items] | ||||
Interest Income | 701 | 116 | 1,586 | 824 |
Travel and corporate solutions | ||||
Segment Reporting Information [Line Items] | ||||
Interest Income | 96 | 90 | 187 | 154 |
Health and employee benefit solutions | ||||
Segment Reporting Information [Line Items] | ||||
Interest Income | $ 1,888 | $ 1,261 | $ 3,382 | $ 2,404 |
Segment Information - Pre-Tax Income Before NCI (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Segment Reporting Information [Line Items] | ||||
Payment processing revenue | $ 126,080 | $ 128,081 | $ 237,136 | $ 245,516 |
Account servicing revenue | 47,433 | 38,474 | 91,955 | 75,422 |
Finance fee revenue | 32,704 | 20,401 | 56,210 | 40,592 |
Other revenue | 27,719 | 26,697 | 54,563 | 54,408 |
Total revenues | 233,936 | 213,653 | 439,864 | 415,938 |
Operating interest expense | 1,505 | 1,357 | 2,891 | 2,936 |
Depreciation and amortization | 23,109 | 20,759 | 45,373 | 42,146 |
Pre-tax adjusted net income | 66,327 | 75,916 | 125,391 | 146,883 |
Fleet Solutions Segment | ||||
Segment Reporting Information [Line Items] | ||||
Payment processing revenue | 70,711 | 80,127 | 133,001 | 153,070 |
Account servicing revenue | 27,548 | 25,360 | 52,986 | 49,243 |
Finance fee revenue | 30,674 | 19,069 | 52,611 | 38,064 |
Other revenue | 15,027 | 10,964 | 26,436 | 23,633 |
Total revenues | 143,960 | 135,520 | 265,034 | 264,010 |
Operating interest expense | 379 | 421 | 801 | 1,161 |
Depreciation and amortization | 7,799 | 6,975 | 15,119 | 14,433 |
Pre-tax adjusted net income | 37,955 | 49,490 | 70,767 | 94,774 |
Travel and corporate solutions | ||||
Segment Reporting Information [Line Items] | ||||
Payment processing revenue | 43,194 | 37,564 | 77,820 | 70,199 |
Account servicing revenue | 337 | 472 | 610 | 880 |
Finance fee revenue | 145 | 73 | 221 | 129 |
Other revenue | 9,660 | 10,105 | 19,827 | 20,080 |
Total revenues | 53,336 | 48,214 | 98,478 | 91,288 |
Operating interest expense | 611 | 266 | 1,163 | 266 |
Depreciation and amortization | 502 | 328 | 858 | 674 |
Pre-tax adjusted net income | 23,200 | 21,726 | 43,191 | 41,014 |
Health and Employee Benefit Solutions Segment | ||||
Segment Reporting Information [Line Items] | ||||
Payment processing revenue | 12,175 | 10,390 | 26,315 | 22,247 |
Account servicing revenue | 19,548 | 12,642 | 38,359 | 25,299 |
Finance fee revenue | 1,885 | 1,259 | 3,378 | 2,399 |
Other revenue | 3,032 | 5,628 | 8,300 | 10,695 |
Total revenues | 36,640 | 29,919 | 76,352 | 60,640 |
Operating interest expense | 515 | 670 | 927 | 1,509 |
Depreciation and amortization | 2,244 | 1,440 | 4,186 | 2,864 |
Pre-tax adjusted net income | $ 5,172 | $ 4,700 | $ 11,433 | $ 11,095 |
Segment Information - Reconciliation of Adjusted Pre-Tax Income Before NCI to Income Before Income Taxes (Detail) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Segment Reporting [Abstract] | ||||
Income before income taxes | $ 16,394 | $ 42,841 | $ 52,798 | $ 77,366 |
Acquisition and divestiture related items | 34,255 | 12,016 | 62,200 | 22,960 |
Stock-based compensation | 4,870 | 3,942 | 9,113 | 7,160 |
Restructuring and other costs | 5,985 | 0 | 7,574 | 8,559 |
Changes in unrealized fuel price derivatives | 0 | 14,956 | 5,007 | 24,301 |
Net foreign currency remeasurement loss (gain) | 4,823 | 2,161 | (11,301) | 6,537 |
Adjusted pre-tax income before NCI | $ 66,327 | $ 75,916 | $ 125,391 | $ 146,883 |
Supplementary Regulatory Capital Disclosure (Details) - USD ($) |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Debt Disclosure [Abstract] | ||
Total Capital to risk-weighted assets, Actual Amount | $ 210,365,000 | $ 202,294,000 |
Total Capital to risk-weighted assets, Ratio | 12.62% | 15.50% |
Total Capital to risk-weighted assets, Minimum for Capital Adequacy Purposes Amount | $ 133,353,000 | $ 104,437,000 |
Total Capital to risk-weighted assets, Ratio | 8.00% | 8.00% |
Total Capital to risk-weighted assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 166,692,000 | $ 130,547,000 |
Total Capital to risk-weighted assets, Ratio | 10.00% | 10.00% |
Tier 1 Capital to average assets, Actual Amount | $ 203,505,000 | $ 193,337,000 |
Tier 1 Capital to average assets, Ratio | 12.20% | 11.23% |
Tier 1 Capital to average assets, Minimum for Capital Adequacy Purposes Amount | $ 66,723,000 | $ 68,865,000 |
Tier 1 Capital to average assets, Ratio | 4.00% | 4.00% |
Tier 1 Capital to average assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 83,404,000 | $ 86,082,000 |
Tier 1 Capital to average assets, Ratio | 5.00% | 5.00% |
Common equity to risk-weighted assets, Actual Amount | $ 203,505,000 | $ 193,337,000 |
Common equity to risk-weighted assets, Ratio | 12.21% | 14.81% |
Common equity to risk-weighted assets, Minimum for Capital Adequacy Purposes Amount | $ 75,002,000 | $ 58,746,000 |
Common equity to risk-weighted assets, Ratio | 4.50% | 4.50% |
Common equity to risk-weighted assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 108,336,000 | $ 84,855,000 |
Common equity to risk-weighted assets, Ratio | 0.065 | 0.065 |
Tier 1 Capital to risk-weighted assets, Actual Amount | $ 203,505,000 | $ 193,337,000 |
Tier 1 Capital to risk-weighted assets, Ratio | 12.21% | 14.81% |
Tier 1 Capital to risk-weighted assets, Minimum for Capital Adequacy Purposes Amount | $ 100,002,000 | $ 78,328,000 |
Tier 1 Capital to risk-weighted assets, Ratio | 6.00% | 6.00% |
Tier 1 Capital to risk-weighted assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 133,337,000 | $ 104,437,000 |
Tier 1 Capital to risk-weighted assets, Ratio | 8.00% | 8.00% |
Subsequent Events (Details) - USD ($) shares in Thousands |
6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Jul. 01, 2016 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Dec. 31, 2015 |
|
Business Acquisition [Line Items] | ||||
Maximum borrowing capacity | $ 125,000,000 | $ 257,500,000 | ||
Proceeds from (Payments of) lines of credit | 76,754,000 | $ (168,829,000) | ||
Revolving line-of-credit facilities and term loan, net | 727,639,000 | 664,918,000 | ||
Electronic Funds Source LLC | ||||
Business Acquisition [Line Items] | ||||
Revenues | $ 135,000,000 | |||
Revolving line-of-credit facilities and term loan, net | $ 2,125,000,000 | |||
Subsequent Event | ||||
Business Acquisition [Line Items] | ||||
Current borrowing capacity | $ 2,125,000,000 | |||
Subsequent Event | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Debt instrument, quarterly payment, percent of original principal amount | 1.25% | |||
Interest coverage ratio (no less than) | 3.25 | |||
Indebtedness to EBITDA Ratio (no more than) | 5.40 | |||
Subsequent Event | 2016 Credit Agreement Tranche B | ||||
Business Acquisition [Line Items] | ||||
Debt instrument unamortized discount, percent | 1.00% | |||
Debt instrument, excess of cash required to be used for debt repayment | 50.00% | |||
Debt instrument, loan prepayment premium, percent | 1.00% | |||
Debt instrument, quarterly payment, percent of original principal amount | 0.25% | |||
Subsequent Event | 2016 Credit Agreement | ||||
Business Acquisition [Line Items] | ||||
Maximum borrowing capacity | $ 375,000,000 | |||
Leverage ratio | 4.00 | |||
Debt instrument, cash proceeds from assets sales required to be used towards debt repayment, percent | 100.00% | |||
Debt instrument. cash proceeds from other debts required to be used towards debt repayment, percent | 100.00% | |||
Revolving line-of-credit facilities and term loan, net | $ 1,875,000,000 | |||
Subsequent Event | Credit Facility Term Loans | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Current borrowing capacity | 455,000 | |||
Subsequent Event | Credit Facility Term Loans | 2016 Credit Agreement Tranche B | ||||
Business Acquisition [Line Items] | ||||
Current borrowing capacity | 1,200,000 | |||
Subsequent Event | Revolving Credit Facility | Letter of Credit | ||||
Business Acquisition [Line Items] | ||||
Current borrowing capacity | 250,000 | |||
Subsequent Event | Revolving Credit Facility | Swingline Loan | ||||
Business Acquisition [Line Items] | ||||
Current borrowing capacity | 20,000 | |||
Subsequent Event | Revolving Credit Facility | 2016 Credit Agreement | ||||
Business Acquisition [Line Items] | ||||
Current borrowing capacity | 470,000 | |||
Proceeds from (Payments of) lines of credit | $ 220,000,000 | |||
Subsequent Event | Electronic Funds Source LLC | ||||
Business Acquisition [Line Items] | ||||
Consideration transferred, shares | 4,012 | |||
Consideration transferred, shares, amount | $ 356,000,000 | |||
Percent of ownership interest acquired | 9.40% | |||
Consideration transferred, cash | $ 1,100,000,000 | |||
Consideration transferred | $ 1,456,000,000 | |||
Minimum | Subsequent Event | 2016 Credit Agreement | ||||
Business Acquisition [Line Items] | ||||
Commitment fee percentage | 0.30% | |||
Maximum | Subsequent Event | 2016 Credit Agreement | ||||
Business Acquisition [Line Items] | ||||
Commitment fee percentage | 0.50% | |||
Interest Rate Option One | Eurocurrency Rate | Subsequent Event | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Debt instrument, interest rate, floor | 0.00% | |||
Interest Rate Option One | Eurocurrency Rate | Subsequent Event | 2016 Credit Agreement Tranche B | ||||
Business Acquisition [Line Items] | ||||
Debt instrument, interest rate, floor | 0.75% | |||
Interest Rate Option One | Eurocurrency Rate | Minimum | Subsequent Event | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Margin on variable rate, percent | 1.75% | |||
Interest Rate Option One | Eurocurrency Rate | Minimum | Subsequent Event | 2016 Credit Agreement Tranche B | ||||
Business Acquisition [Line Items] | ||||
Interest rate, stated percentage | 3.25% | |||
Interest Rate Option One | Eurocurrency Rate | Maximum | Subsequent Event | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Margin on variable rate, percent | 3.25% | |||
Interest Rate Option One | Eurocurrency Rate | Maximum | Subsequent Event | 2016 Credit Agreement Tranche B | ||||
Business Acquisition [Line Items] | ||||
Margin on variable rate, percent | 3.50% | |||
Interest Rate Option Two | Eurocurrency Rate | Subsequent Event | ||||
Business Acquisition [Line Items] | ||||
Margin on variable rate, percent | 1.00% | |||
Interest Rate Option Two | Eurocurrency Rate | Minimum | Subsequent Event | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Margin on variable rate, percent | 0.75% | |||
Interest Rate Option Two | Eurocurrency Rate | Minimum | Subsequent Event | 2016 Credit Agreement Tranche B | ||||
Business Acquisition [Line Items] | ||||
Interest rate, stated percentage | 2.25% | |||
Interest Rate Option Two | Eurocurrency Rate | Maximum | Subsequent Event | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Margin on variable rate, percent | 2.25% | |||
Interest Rate Option Two | Eurocurrency Rate | Maximum | Subsequent Event | 2016 Credit Agreement Tranche B | ||||
Business Acquisition [Line Items] | ||||
Margin on variable rate, percent | 2.50% | |||
Interest Rate Option Two | Federal Fund Rate | Subsequent Event | ||||
Business Acquisition [Line Items] | ||||
Margin on variable rate, percent | 0.50% | |||
Leverage Ratio One | Subsequent Event | 2016 Credit Agreement Tranche B | ||||
Business Acquisition [Line Items] | ||||
Debt instrument, excess of cash required to be used for debt repayment | 25.00% | |||
Leverage Ratio Two | Subsequent Event | 2016 Credit Agreement Tranche B | ||||
Business Acquisition [Line Items] | ||||
Debt instrument, excess of cash required to be used for debt repayment | 0.00% | |||
December 31, 2016 | Subsequent Event | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Indebtedness to EBITDA Ratio (no more than) | 5.25 | |||
December 31, 2017 | Subsequent Event | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Indebtedness to EBITDA Ratio (no more than) | 5.00 | |||
December 31, 2018 | Subsequent Event | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Indebtedness to EBITDA Ratio (no more than) | 4.25 | |||
December 31, 2019 | Subsequent Event | 2016 Credit Agreement Tranche A | ||||
Business Acquisition [Line Items] | ||||
Indebtedness to EBITDA Ratio (no more than) | 4.00 |
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