Q4 2021 Fleetcor Technologies Inc Earnings Call
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Speaker 1: Greetings. Welcome to the Fleetcore Technologies Inc. 4th Quarter 2021 Earnings Conference Call. At this time, all participants are in listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded.
Greetings and welcome to the fleet core Technologies, Inc. Fourth quarter 2021 earnings conference call.
At this time all participants are in a listen only mode.
A question and answer session will follow the formal presentation.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.
Please note this conference is being recorded.
Speaker 1: I will now turn the conference over to your host, Jim Egglesetter, head of investor relations. Thank you. Let's begin.
I'll now turn the conference over to your host Jim Eglseder head of Investor Relations. Thank you you may begin.
Speaker 2: Good afternoon, everyone. And thank you for joining us today for our fourth quarter in full year 2021.
Good afternoon, everyone and thank you for joining us today for our fourth quarter and full year 2021 earnings call.
Speaker 2: With me today are Ron Clark, our Chairman and CEO , and Charles Freund, our CFO .
With me today are Ron Clarke, our chairman and CEO and Charles Froind our CFO .
Speaker 2: Following their prepared comments, the operator will announce the queue will open for the Q&A session.
Following their prepared comments, the operator will announce the queue will open for the Q&A session.
It is only then that you can get in line for questions.
Speaker 2: Please note that our earnings release and supplement can be found under the investor relations section of our website at Fleetcore.com. Now, throughout this call, we will...
Please note that our earnings release and supplement can be found under the Investor Relations section of our website at <unk> Dot com.
Now throughout this call we will be discussing organic growth as a reminder, organic revenue growth neutralizes the impact of year over year changes in foreign exchange rates fuel prices and fuel spreads and includes pro forma results for acquisitions closed during the two years being compared.
Speaker 2: As a reminder, organic revenue growth neutralizes the impact of year-over-year changes in foreign exchange rates, fuel prices, and fuel spreads, and includes pro forma results for acquisitions closed during the two years being compared
Speaker 2: We will also be discussing non-GAAP financial metrics, including revenues, net income, and then a capability to share, all on an adjusted basis.
We will also be discussing non-GAAP financial metrics, including revenues net income and then per diluted share all on an adjusted basis. These measures are not calculated in accordance with GAAP and may be calculated differently than at other companies.
Speaker 2: These measures are not calculated in accordance with GAP and may be calculated differently than at other companies. Reconciliations of the historical non-GAAP to the most directly comparable GAP information can be found in today's press release and on our website.
Conciliations of the historical non-GAAP to the most directly comparable GAAP information can be found in today's press release and on our website.
Speaker 2: I do need to remind everybody that part of our discussion today may include forward-looking statements. These statements reflect the...
I do need to remind everybody that part of our discussion today may include forward looking statements.
These statements reflect the best information we have today.
Speaker 2: All statements about our outlook, new products, and expectations regarding business development and future acquisitions are based on that.
All statements about our outlook, new products and expectations regarding business development and future acquisitions are based on that information.
Speaker 2: They are not guarantees of future performance, and you should not put undue reliance upon them. We undertake no obligation to...
They are not guarantees of future performance and you should not put undue reliance upon we undertake.
No obligation to update any of these statements.
Speaker 2: These expected results are subject to numerous uncertainties and risks, which could cause actual results to differ materially from what we...
These expected results are subject to numerous uncertainties and risks, which could cause actual results to differ materially from what we expect.
Speaker 2: Some of those risks are mentioned in today's press release on Form 8K and in our annual report on Form 10K followed with the Securities and Change Commission. These documents are available on our website.
Some of those risks are mentioned in today's press release on form 8-K and in our annual report on Form 10-K filed with the Securities and Exchange Commission. These.
These documents are available on our website and at SEC Gov.
Speaker 2: Now, it's out of the way and we'll turn the call over to Ron Clark, our chairman and CEO . Ron?
Now it's out of the way I will turn the call over to Ron Clarke, our chairman and CEO Ron.
Speaker 3: Okay, Jim, thanks. Good afternoon, everyone, and thanks for joining our Q4 earnings call. So up front here, I'll plan to cover three subjects. So first, provide my view of Q4, along with full year 21 results. Secondly, out our 2022 guidance and priorities for the year. And then lastly, I'll share my thoughts on the company's midterm imperative.
Okay, Jim Thanks.
Good afternoon, everyone and thanks for joining our Q4 earnings call. So upfront here I'll plan to cover three subjects. So first provide my view of Q4.
Along with full year 'twenty one results.
Second lay out our 2022 guidance and priorities for the year.
And then lastly, I'll share my thoughts on the companies.
Mid term imperatives.
Speaker 3: Okay, let me make the turn to our Q4 results, which were quite good. So we reported revenue of 802 million up 30% and cash EPS of 372, that's up 24%. Both record highs for the company. Revenue came in quite hot, almost 40 million higher than the revenue guidance we provided 90 days ago.
Okay, Yeah, let me make the turn to our Q4 results, which which were quite good. So we reported revenue of 802 million up 30%.
And cash EPS of $3 72, that's up 24%.
Both record highs for the company revenue came in quite hot almost 40 million higher.
Then the revenue guidance, we provided 90 days ago.
Speaker 3: Organic revenue growth for Q4 good up 17%. Also up 7% against Q4 19. Every line of business double digit organic revenue grows in the quarter.
Organic revenue growth for Q4, good up 17% also up 7% against Q4 19.
Every line of business double digit organic revenue growth in the quarter.
Speaker 3: Our Q4 trends continued quite good, record sales in the quarter, up 40% versus prior year. Steadie revenue retention at 93%, same store sales, healthy at plus 6%.
Our Q4 trends continued are quite good.
Record sales in the quarter up 40% versus prior year.
Steady revenue retention at 93%.
Same store sales healthy at plus 6%.
Speaker 3: We have had some notable call outs since we spoke last. We formalized our partnership with the largest bank in Brazil, which will help distribute our total products. So we expect a lift there. We launched formally our Corpay 1 SMB platform business. So getting our corporate payments business into the SMB space.
We have had some notable call out since we spoke last.
We formalized our partnership with the largest bank in Brazil.
What you will help distribute our toll products. So we expect lift there.
We launched formally our core pay one SMB platform business, so getting our corporate payments business into the SMB space.
Speaker 3: We just completed another investment in an EV software company.
Just completed another investment and then E V software company.
Speaker 3: We upsized our term loan $750 million.
Upsized, our term loan and $750 million.
Speaker 3: We repurchased over 3 million FLT shares in Q4 in January , and we completed the rebranding of our corporate payments business, all the brands now under Corpe.
We repurchased over 3 million F. L. T shares in Q4 and in January and we completed the rebranding of our corporate payments business all the brands now under core Bay.
Speaker 3: So in summary, really a good finish to the year, better than we expected, and the trends helpful as we look into 2022.
So in summary, I'm really a good a good finish to the year better.
Better than we expected.
And the trends helpful. As we look into 2022.
Speaker 3: Okay, let me, let me turn to 2021 full year.
Okay. Let me, let me turn to 2021 full year.
Speaker 3: I think we characterized 2021 really as a comeback year when we moved ahead of our 2019 pre-pandemic baseline.
I think we characterize.
2021 really is a comeback year.
We moved ahead of our 2019, our pre pandemic baseline.
Speaker 3: really good financial results, 21 revenue up 2.8 billion, up 19%, cash EPS of 1321, also up 19%. Both of those results record highs for the company.
Good financial results 'twenty, one revenue $2 8 billion up 19%.
Cash EPS of $13 21 also up 19% both of those results are.
Record highs for the company.
Speaker 3: We did open 2021 with an initial guide of 1231 of cash EPS at the midpoint. So now finishing 90 cents better than that initial guide. So clearly a better year than expected. Organic revenue growth for 2021 up 12%. That's the highest organic revenue growth that we've ever reported.
We did open 2021 with an initial guide of 12 31 of cash EPS at the midpoint. So now, finishing 90 cents better than that initial guide so clearly a.
Better year than expected organic revenue growth for 2021.
12%, that's the highest organic revenue growth that we've ever reported.
Speaker 3: 2021 sales, super good record levels up 46% versus 2020 and up 19% versus 2019. We've added 175,000 new clients, 175,000 new clients to our books in 21 across the world. So strong demand for our service.
2021 sales super good record levels up 46%.
Versus 2020.
And up 19% versus 2019, we've added 175000, new clients 175000, new clients to our books in 'twenty one across the world. So.
Strong demand for our services, we did close two accretive acquisitions in 'twenty one and.
Speaker 3: We did close to a creative acquisitions in 21 and expect together.
And expect together.
Speaker 3: those to deliver 50 to 60 cents of incremental cash EPS here in 22. All in all a meaningful recovery from 2020.
Those to deliver 50 to 60.
Of incremental cash EPS here in 'twenty two so all in all a.
Full recovery from 2020.
Speaker 3: All right, let me, let me cover now our initial thoughts on 2022 guidance along with the priorities for the year. We've mentioned before our stated midterm objectives for the company are to grow sales 20% plus, to grow organic revenue 10% plus, and to grow cash EPS 15 to 20%. 300% cost 100% initially or no
Alright, let me let me cover now our initial thoughts on 2022.
<unk> along with the priorities for the year.
We've mentioned before our stated midterm objectives for the company are to grow sales are 20% plus to grow organic revenue.
10% plus and to grow cash EPS.
15% to 20%.
Speaker 3: Good news are 22 guidance meets all three of these objectives. So here goes. For revenue in 2022 at the midpoint, 3,220 million, that's up 14 percent. Cash EPS of 15, 25 at the midpoint, up 15 percent. Organic revenue growth overall, up 10 percent.
Good news R 22.
Guidance meets all three of these objectives.
So here goes.
For revenue in 2022.
At the midpoint $3.220 billion, that's up 14% cash EPS of <unk> 25 at the midpoint up 15%.
Organic revenue growth overall are up 10% and sales growth.
Speaker 3: and sales grows just over 20%.
Just over 20%.
Speaker 3: This guidance does not include any forward capital allocation beyond the leveraging.
This guidance does not include any forward capital allocation beyond deleveraging.
Speaker 3: There's no real macro help in these numbers. We're basically out looking to macro to be neutral. Yes, higher fuel prices, but really offset by some weaker FX. We have assumed about a 1% COVID recovery in our same store sales client base coming back this year in 22.
There's no real macro health in these numbers were basically out looking the macro to be neutral.
Yes, higher fuel prices, but really offset by some weaker FX, we have assumed about a 1%.
Covid recovery in our same store sales client base coming back this year in 'twenty two.
Speaker 3: Confidence pretty high in these numbers. About half of the expected year over year performance improvement is already in our exit rate or run rate coming into the year. So that helps our recent sales and retention trends support the forecast.
Confidence are pretty high in these numbers.
About half of the expected year over year performance improvement.
It's already in our exit rate or run rate coming into the year So that helps.
Our recent sales and retention trends support the forecast.
Speaker 3: Most of the synergies for the two big acquisitions are really already baked. So we expect to get that accretion and we have repurchased about six and a half million shares a year ago. So obviously going to be quite a credo.
Most of the synergies for the two big acquisitions are really already baked.
So we expect to get that accretion and we have perked repurchased about six 5 million shares from a year ago.
So obviously going to be quite accretive.
Speaker 3: In terms of priorities, we have picked a few things that will invest in incrementally this year. So digital sales, we're expecting a big increase in digital sales production in 22 and are making us incremental investments in digital advertising and staff.
In terms of priorities, we have picked a few things.
That will invest in incrementally this year, so digital sales, we're expecting a big increase in digital sales production in 'twenty two.
We are making the incremental investments in digital advertising.
And staff.
Speaker 3: IT, big investments and IT transformation to accelerate our move to the cloud. And this platform business that I spoke of where we're joining up our walk around services with our Central AP services, I'm gonna push those platforms pretty hard and get a read on demand.
E <unk>.
Big investments in our it transformation to accelerate our move to the cloud and this platform business that I spoke of where we're joining up our work around services with our central AP services.
Going to push those platforms pretty hard and get a read on demand. So all in all a pretty ambitious year.
Speaker 3: So all in all, a pretty ambitious year.
Speaker 3: Okay, so last up today, I'd like to talk about our midterm prospect.
Okay. So last up today I'd like to talk about our midterm prospects.
Speaker 3: and the imperatives for the company. I thought it might be helpful to rewind just a bit.
And the imperatives for the company.
I thought it might be helpful to rewind just a bit.
Speaker 3: for anyone new on the call. Just remind everyone who Fleet Corps is and what we're trying to do. So in a nutshell, Fleet Corps provides B2B specialty payment solutions.
For anyone new on the call.
Just to remind everyone hopefully core is and what we're trying to do so in a nutshell fleet core provides a b to b specialty payment solutions really all intended to do one thing.
Speaker 3: really all intended to do one thing, which is to help businesses, our clients spend less, primarily by controlling what they buy and what they pay for.
Which is to help businesses, our clients spend less primarily by controlling what they buy and what they pay for.
Speaker 3: Our differentiation kind of really comes in two forms. First, our products are highly specialized. We target certain kinds of clients with very specialized needs. So our products would look different for trucking firms than they would look for plumbing firms. Our travel services would look different for blue collar travelers than they would for white collar travelers.
Our differentiation kind of really comes in two forms.
First our products are highly specialized.
We target certain kinds of clients with very specialized needs. So our products will look different for trucking firms than they would look for plumbing firms.
Our travel services will look different for blue collar travelers than they would for white collar travelers, so very dialed in kind of product line.
Speaker 3: So very dialed in kind of product.
Speaker 3: And second, we operate more than 15 proprietary acceptance networks. That allows us to capture very unique data at the point of sale. We also enjoy very favorable economics, which we share with our clients.
Second we operate more than 15 proprietary acceptance networks.
That allows us to capture very unique data at the point of sale. We also enjoy very favorable economics.
Which we share with our clients.
Speaker 3: So this focus or specialized approach coupled with a two-sided business model has allowed us to deliver consistent growth over long period of time.
This focused or a specialized approach coupled with a two sided business model has allowed us to deliver consistent growth over a long period of time.
Speaker 3: So let me turn to the three imperatives, the big things that were on that we think are critical to driving, sustain, growth over the long term.
So let me turn to the to the three imperatives. The big things that were on that we think are critical too.
Driving sustained growth over the long term. So first up is E V.
Speaker 3: So first up is EV. We're working EV and the energy transition hard. We do feel like we've made a lot of progress so far. So both here and in Europe , we've added public acceptance network for EV. So public charge points or recharge points. We've invested in EV software companies that facilitate at home, recharging and reimbursement.
We're working.
<unk> in the in the energy transition are hard.
Do feel like we've made a lot of progress so far so both here and in Europe , We've added public acceptance networks for EV So public.
Charge points of recharge points.
We've invested in EV software companies that facilitate at home recharging and reimbursement.
Speaker 3: We signed up a few hundred clients to our EV service to get feedback on the service.
We signed up a few hundred clients to our <unk> service to get feedback on the service.
Speaker 3: And initially here we're seeing the revenue or the, you know, economics from our service, EV service roughly in line with our more traditional refueling services. So look, we're on this EV will manage along with the transition and continue to report out.
And initially here, we're seeing the revenue or the economics from our service <unk> service roughly in line with our more traditional refueling services. So look we're on this EV will manage along with the transition and continue to report out.
Speaker 3: Second imperative is digital. We're companies working super hard to make the digital transition.
Second imperative is digital.
Or companies working Super hard to make the digital transition.
Speaker 3: accelerated by COVID. So the first thing I'd say is sales has really made the pivot. Last year over 50% of our global fuel card sales came in digitally. And over half of those processing end-to-end with no human intervention.
Accelerated by Covid. So the first thing I'd say is sales has really made the pivot so last year over 50% of our global fuel card sales came in digitally and over half of those are.
Processing end to end with no human intervention.
Speaker 3: On the marketing front, we've moved our focus to top of the funnel. So we're using digital advertising, ABM technology, to identify prospects interested in our services.
On the marketing front, we've moved our focus to top of the funnel. So we're using digital advertising AVM technology to identify prospects interested in our services on.
Speaker 3: On the client experience front, we've really advanced our UIs and their capability to allow our clients to do more themselves. So faster and easier than ever before.
On the client experience front, we've really advanced are you is.
And their capability to allow our clients to do more themselves, so faster and easier than ever before.
Speaker 3: And at the point of sale, we've added new ways to transact with us beyond cards. So including mobile phones, RFID technology, even connected cards.
At the point of sale.
<unk> added new ways to transact with us.
<unk> cards, so, including mobile phones, RFID technology, even connected cars. So a.
Speaker 3: So a lot of progress on the digital front. So last up is diversification, transitioning our portfolio to bigger TAMs and the higher growth segments.
A lot of progress on the digital front, so last up is diversification.
Transitioning our portfolio to.
The bigger Tam enter into higher growth segments. So you've heard us speak of beyond going beyond and which we extend each of our existing businesses.
Speaker 3: So you've heard a speak of beyond going beyond in which we extend each of our existing businesses into adjacent market segments to create more opportunity.
Into adjacent market segments to create more opportunity. So just a few examples there so our corporate payments business.
Speaker 3: So just a few examples there. So our corporate payments business.
Speaker 3: Traditionally, a middle-market business now entering the SMV space.
Traditionally our middle markets business, now entering the SMB space or travel or lodging business.
Speaker 3: Our travel or lodging business, really a workforce, blue collar, focus business has recently added airline or lodging for crews and displaced homeowners or homeowners insurance companies really to extend the potential of that business.
Really a work force blue collar.
<unk> business is.
Has recently added airline or lodging for crews.
And displaced homeowners or homeowners insurance companies.
Really to extend the potential of that business in Brazil.
Speaker 3: In Brazil, historically a toll-centric, highway-centric, a client base, we're now adding hundreds of thousands of urban or city dwellers to our expanded offering.
Historically, a toll centric highways centric client base, we're now adding hundreds of thousands of.
Urban or city dwellers, too to our expanded offering.
Speaker 3: So look, over time we do expect these adjacencies to increase the opportunity for each of our business.
So look over time, we do expect these adjacencies to two.
To increase the opportunity for each of our businesses.
Speaker 3: Platform business. I mentioned we will join up our specialized payment solutions into one comprehensive platform in which a single business or client could use, for example, our smart business cards, our travel solutions, and our online bill pay services all from the same UI and all from up.
Our platform business I mentioned, we will join up our specialized payment solutions into one.
Comprehensive platform in which a single business our client could use for example, our smart business cards, our travel solutions and our online Bill pay services all from the same UI and all from us.
Speaker 3: So this platform concept really combines our capabilities for employee walk around kinds of purchases along with Central Bill Pay.
So this this platform.
Concept really combines our capabilities for employee walk around kinds of purchases along with central Bill pay.
Speaker 3: So we think the platform idea has as big potential and can be quite additive to the specialized payment services that we offer to.
So we think the platform idea has.
As big potential and can be quite additive to the specialized payment services that we offer now.
Speaker 3: As a result of these extensions, we are expecting our global fleet card business to account for about 40% of the company's revenue this year. That's down from about 50% five years ago. So again, repositioning for a faster growth.
As a result of.
These extensions we are expecting our global fleet card business to account for about 40% of the company's revenue. This year, that's down from about 50%.
Five years ago, So again repositioning for a faster growth.
Speaker 3: So we do plan to work these three midterm and paratives, hard EV, digital and diversification. Of course, we'll report progress as we go.
So we do plan to work these three mid.
Midterm imperatives hard.
<unk> digital.
Diversification of course, we'll report progress as we go.
Speaker 3: So in conclusion today, back to Q4 again, better than we expected and good trends coming into this year. 2021 really again, a comeback year finishing much, much better than we thought at the outset.
So in conclusion today.
Back to Q4 again better than we expected.
And good trends coming into this year 2021 really again come back year, finishing much much better than we thought at the outset.
Speaker 3: this year, 2022, another guide to growth, organic growth of expected of 10 percent, earnings expected to be up 15 percent. So a lot of a lot of distance from our pre pandemic baseline.
This year 2022.
Another guide to growth organic growth of expected at 10%.
Earnings expected to be up 15% so lot of a lot of distance from our pre pandemic baseline.
Speaker 3: And the midterm, again, we're pretty focused on these three imperatives that I just outlined key to sustainable growth of the company.
And the mid term.
Again, we're pretty focused on these three imperatives that I just outlined key to sustainable growth of the company.
Speaker 3: So with that, let me turn the call back over to Chuck to provide some additional details on the quarter. Chuck.
So with that let me turn the call back over to Chuck to provide some additional details on the quarter Chuck.
Thanks, Ron.
Speaker 2: So, jumping into the product category details behind our 17% organic revenue growth in Q4, corporate payments was up 18% with another quarter of strong performance in full AP, which was up over 50% yet again.
So jumping into the product category details behind our 17% organic revenue growth in Q4, corporate payments was up 18% with another quarter of strong performance in full AP, which was up over 50% yet again.
Speaker 2: Our card products, virtual and multi-card were up 16% and cross-border was up 14%, which is normalized for the AFX acquisition we closed in June .
Our card products virtual and multi card were up 16% and cross border was up 14%, which is normalized for the apex acquisition, we closed in June .
Speaker 2: In cross-border, we completed the final customer migrations from Apex's systems to our core pay cross-border platform in December . And we'll continue with the integration of back-office systems and processes throughout this year. Our these are holding with synergies and accretion in line with our expectations.
In cross border, we completed the final customer migrations from apex systems to our core pay cross border platform in December .
Continue with the integration of back office systems and processes throughout this year, our theses are holding with synergies and accretion in line with our expectations.
Speaker 2: I'd like to give a big shout out to our integration team as it's due to their hard work and dedication that the conversion has been so seamless and successful.
I'd like to give a big shout out to our integration team as it's due to their hard work and dedication that the conversion has been so seamless and successful.
Speaker 2: Fuel was up organically 12 percent with growth in every geography, largely as a result of our digital sales efforts and strong retention rates.
Fuel was up organically, 12% with growth in every geography, largely as a result of our digital sales efforts and strong retention rates.
Speaker 2: Our ability to sell and retain fuel card customers around the world demonstrates the attractiveness of our offers, the competitiveness of our products, and the effectiveness of our technology.
Our ability to sell and retained fuel card customers around the world demonstrates the attractiveness of our offers the competitiveness of our products and the effectiveness of our technology.
Speaker 2: We continue to make good progress in developing and marketing our EV charge management solutions, particularly in Europe , where we now have over 5,000 clients with EV enabled cards or fog.
We continue to make good progress in developing and marketing our EV charge management solutions, particularly in Europe , where we now have over 5000 clients with EV enabled cards or thoughts.
Speaker 2: We've also been actively expanding the on-road network acceptance of our EV solutions, with approximately 6,500 charge points in the UK now accepting our products.
We've also been actively expanding the on road network acceptance of our EV solutions with approximately 6500 charge points in the U K now accepting our products.
Speaker 2: This represents about 22% coverage of all publicly available charge points in the country.
This represents about 22% coverage of all publicly available charge points in the country.
Speaker 2: on the continent, we've got around 85% coverage, as our products are accepted at roughly 190,000 charge points.
On the continent, we've got around 85% coverage as our products are accepted at roughly 190000 charge points. We built a dedicated organization to advance our EV efforts and will continue to support our fuel card customers as they slowly migrate to <unk>.
Speaker 2: We've built a dedicated organization to advance our EV efforts and will continue to support our fuel card customers that they slowly migrate to EV.
Speaker 2: Tolls was up 17% compared with last year, as strong new sales, up 20%, and some new retention initiatives are really paying off. We made tremendous progress to expand our toll business.
<unk> was up 17% compared with last year as strong new sales up 20% and some new retention initiatives are really paying off we made tremendous progress to expand our toll business. This year.
Speaker 2: We doubled our fuel locations year over year to nearly 1200 and we had nearly half a million active fuel users as of year F.
We doubled our fuel locations year over year to nearly 1200.
And we had nearly half a million active fuel users as of year end.
Speaker 2: We recently signed Mitsubishi, Hyundai, Toyota and Kia to install our tags on vehicles before they leave the factory.
We recently signed Mitsubishi Hyundai and Toyota and Kia to install our tags on vehicles before they leave the factories.
Speaker 2: And as Ron mentioned earlier, we completed our joint venture with Kaysha, Brazil's largest bank.
And as Ron mentioned earlier, we completed our joint venture with Taisha Brazil's largest bank.
Speaker 2: Our lodging business continued to perform well, up 39%.
Our lodging business continued to perform well up 39%.
Speaker 2: Workforce lodging has improved with higher volume and airlines especially outperformed with organic growth over 100% as domestic air travel rebounded from COVID lows.
Workforce lodging has improved with higher volume and airlines, especially outperformed with organic growth over 100% as domestic air travel rebounded from Covid loads.
Speaker 2: The integration of ALE solutions, a provider of lodging services to displaced policy holders of major insurance companies, is going quite smoothly. And we're increasingly confident in the value it will deliver.
The integration of <unk> solutions, a provider of lodging services to displaced policyholders are major insurance companies is going quite smoothly and we're increasingly confident in the value it will deliver.
Speaker 2: Gift Organic Growth was 19% year over year.
Gift organic growth was 19% year over year.
Speaker 2: As the new efforts we've discussed on the last several calls, continue to produce results. Especially the Retailer Online Sales Channel.
As the new efforts, we've discussed on our last several calls continue to produce results, especially the retailer online sales channel.
Speaker 2: We also saw a pickup and car replenishment orders, which have been delayed due to COVID-19.
We also saw a pickup in carb replenishment orders, which had been delayed due to COVID-19 concerns.
Speaker 2: Now looking further down on the income statements, operating expenses of $462 million represented an increase over prior year, primarily due to the addition of the Apex and ALE operations. As well as higher deal and integration related costs, increases tied to higher volumes across our businesses, stock compensation, and new sales generation activities and investments to drive future growth.
Now looking further down the income statement operating expenses of $462 million represented an increase over prior year, primarily due to the addition of the apex and <unk> operations as well as higher deal and integration related cost increases tied to higher volumes across our.
Stock compensation, and new sales generation activities and investments to drive future growth.
Speaker 2: Bad debt expense was $18.5 million or five basis points. As credit losses have returned to more historical levels.
Bad debt expense was $18 $5 million or five basis points as credit losses have returned to more historical levels.
Speaker 2: Interest expense decreased 9% year over year. Due to a slight decline in LIBOR rates and the offset of higher interest rate supplied to customer deposits and cash balances in certain foreign jurisdictions.
Interest expense decreased 9% year over year due to a slight decline in LIBOR rates and the offset of higher interest rates applied to customer deposits and cash balances and certain foreign jurisdictions.
Speaker 2: We incurred $9.9 million of costs during the quarter, associated with the incremental $750 million in term B debt we added in December .
We incurred $9 9 million of costs during the quarter associated with the incremental $750 million in term b debt we added in December .
Speaker 2: On the term B increase, the rate was the same as our existing facility at Li-Blor plus 175 basis points and maturers in April 2028.
On the term B increase.
Rate was the same as our existing facility at LIBOR, plus 175 basis points and matures in April 2028.
Speaker 2: Our ratings and leverage remained effectively unchanged, reflecting the strength and earnings power of our company.
Our ratings and leverage remained effectively unchanged.
<unk>, the strength and earnings power of our company.
Speaker 2: Our effective tax rate for the quarter was 25.6% versus 20.3% last.
Our effective tax rate for the quarter was 25, 6% versus 23% last year with the increase driven primarily by the lack of excess tax benefit on stock option exercises.
Speaker 2: with the increased driven primarily by the lack of excess tax benefit on stock option exercise.
Speaker 2: Now turning to the balance sheet. We ended the quarter with over $1.5 billion in unrestricted cash, and we had $1.1 billion available on our revolver.
Now turning to the balance sheet, we ended the quarter with over $1 5 billion in unrestricted cash and we had $1 $1 billion available on our revolver.
Speaker 2: There was $4.9 billion outstanding on our credit facilities, which included the incremental $750 million to turn B debt, I just mentioned.
There was $4 $9 billion outstanding on our credit facilities, which included the incremental $750 million term b debt I just mentioned.
Speaker 2: Finally, we had $1.1 billion borrowed in our Securitization Facility.
Finally, we had $1 $1 billion borrowed in our securitization facility.
Speaker 2: All in, as of December 31, our leverage ratio was 2.71 times trailing 12-month-adjusted EBITDA, as calculated in accordance with our credit agreement.
All in as of December 31, our leverage ratio was 271 times trailing 12 months adjusted EBITDA as calculated in accordance with our credit agreement.
Speaker 2: As Ron mentioned, in the quarter, we repurchased roughly 2.3 million shares. And in total, we repurchased about 5.5 million shares during 2021.
As Ron mentioned in the quarter, we repurchased roughly two 3 million shares and in total we repurchased about five 5 million shares during 2021.
Speaker 2: We also bought 1.1 million shares in January under our 10B51 plan.
We also bought $1 1 million shares in January under our <unk> one plan.
Speaker 2: You may have seen in our press release that our board authorized another $1 billion in repurchase.
You may have seen in our press release that our board authorized another $1 billion in repurchases. So.
Speaker 2: taking all that into account, we still have almost $1.4 billion authorized for?.
So taking all of that into account, we still have almost one $4 billion authorized for repurchases as of today.
Speaker 2: We believe we have ample liquidity to pursue any near-term M&A opportunities and continue to buy back shares when it makes sense.
We believe we have ample liquidity to pursue any near term M&A opportunities and continue to buy back shares when it makes sense.
Speaker 2: I think it's important to remind everyone of the power that our earnings and cash flow gives
I think it's important to remind everyone of the power that our earnings and cash flow gives us.
Speaker 2: recapping 2021, we repurchased 5.5 million shares for $1.36 billion.
Recapping 2021.
We repurchased five 5 million shares for $1 $3 6 billion or.
Speaker 2: Our guidance for Share account for 2022 is down 7 million shares from what we guided a year ago.
Our guidance for share count for 2022 is down 7 million shares from what we guided a year ago.
Speaker 2: We spent $950 million on deals, which will generate incremental earnings of 50 to 50 cents per share next year, and continue to provide growth in future years.
We spent $950 million on deals, which will generate incremental earnings of $50 60 per share next year.
And continue to provide growth in future years.
Speaker 2: We also raised an additional $1.55 billion of term B debt, $800 million in Q2 and $750 million in Q4 at very attractive rates and terms. And our leveraged-
We also raised an additional 155 billion of term b debt $800 million in Q2 and $750 million in Q4 at very attractive rates and terms.
And our leverage barely changed.
Speaker 2: We believe the combination of our strong position, the structure of our business model, and high recurring revenues will enable us to deliver consistent quality growth year after year after year.
We believe the combination of our strong position the structure of our business model and high recurring revenues will enable us to deliver consistent quality growth year after year after year.
Speaker 2: Now let me share some thoughts on our Q1 Outlook and our full year assumption.
Now, let me share some thoughts on our Q1 outlook and our full year assumptions.
Speaker 2: Looking ahead, we're expecting Q1 2022 revenue to be between $740 and $760 million, and adjusted net income per share to be between $3.45 and $3.55, which at the midpoint is approximately $0.68 or 24% higher than what we reported in Q1 of 2021.
Looking ahead, we're expecting Q1 2022 revenue to be between 740 $760 million and adjusted net income per share to be between $3 45 and.
And $3 55.
Which at the midpoint is approximately 68.
Our 24% higher than what we reported in Q1 of 2021.
Speaker 2: You may notice the midpoint of our Q1 guide is also approximately 22 cents or 6% lower than what we reported in Q4 of 2021. This is largely due to revenue seasonality, where certain businesses such as gift and tolls have strong fourth quarters, while fuel and lodging tend to have soft first quarters due to weather and holiday.
You may notice the midpoint of our Q1 guide is also approximately 22.
Were 6% lower than what we reported in Q4 of 2021.
This is largely due to revenue seasonality, where certain businesses such as gift and tolls have strong fourth quarters, while fuel in lodging tend to have soft first quarters due to weather and holidays.
Speaker 2: As such, the first quarter tends to be the lowest in terms of both revenue and profit for our company.
As such the first quarter tends to be the lowest in terms of both revenue and profit for our company.
Speaker 2: I'd like to note a few assumptions underlying the full year 2022 guidance Ron provided earlier.
I'd like to note a few assumptions underlying the full year 2022 guidance Bob provided earlier.
Speaker 2: We expect bad debt to be about $30 million higher than 2021 levels. As we see a return to more normalized credit losses, doing part to increasing sales production.
We expect bad debt to be about $30 million higher than 2021 levels as we see a return to more normalized credit losses due in part to increasing sales production.
Speaker 2: Our interest expense guidance of $90 to $100 million assumes 325 basis point rate increases throughout the year.
Our interest expense guidance of $90 million to $100 million.
Assumes 325 basis point rate increases throughout the year.
Speaker 2: and our tax rate is also expected to be higher. At between 24 and 26%, as we expect any excess tax benefit from stock option exercises to remain low relative to the last few years.
And our tax rate is also expected to be higher at between 24, and 26% as we expect any excess tax benefit from stock option exercises to remain low relative to the last few years.
Speaker 2: The effects of these higher expenses will be partially offset by the lower share count resulting from our repurchase activity over the past 13 months. The rest of our assumptions can be found in our press release and supplement.
The effects of these higher expenses will be partially offset by the lower share count, resulting from our repurchase activity over the past 13 months.
The rest of our assumptions can be found in our press release and supplement.
Now, let's move beyond the results and the outlook.
Speaker 2: Since we last spoke, our new ESG report was published and is available in the Investor Relations section of our website.
Since we last spoke our new ESG report was published and is available in the Investor Relations section of our website.
Speaker 2: Some highlights you will find in the document are more details around our workforce advantage, including our comprehensive employee development and training programs, and our adoption of the Rooney Rule for all vice president and above position.
Some highlights you will find in the document or more details around our workforce advantage, including our comprehensive employee development and training programs and our adoption of the Rooney rule for all vice president and above positions.
Speaker 2: as well as some reporting on our global data centers, including the significant reduction in power usage and footprint, which are down 40% and 62% respectively over the last five years.
As well as some reporting on our global data centers, including the significant reduction in power usage and footprint, which are down 40% and 60% respectively over the last five years.
Speaker 2: Finally, I would like to thank our nearly 10,000 employees around the world who helped us deliver a strong finish to a great year and who will be the driving force to even greater heights in 2022.
Finally, I would like to thank our nearly 10000 employees around the world, who helped us deliver a strong finish to a great year, and who will be the driving force to even greater heights in 2022.
Speaker 2: Thank you for your interest in Fleet Corps. And now, operator, we'd like to open the line for questions.
Thank you for your interest in <unk> and now operator, we'd like to open the line for questions.
Speaker 1: Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tunnel indicate your line is in the question queue. You might press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your hands up before pressing the star key.
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Speaker 1: Our first question comes from the line of Pied Christensen with City. Please proceed with your question.
Our first question comes from the line of Pete Christiansen with Citi. Please proceed with your question.
Good evening.
Okay.
Okay.
Speaker 4: We're going to have the outlook. Which... Okay, Dave, we're struggling to do a hearing. I'm sorry. Can you hear...
Which is which is good to see.
Ron.
Looking at the outlook, which.
Okay, Steve we're struggling to hear you.
I'm sorry can you hear me.
Yes.
It is now.
Uh huh.
You can dial back in.
Okay. So you can take.
Next question.
Speaker 1: Thank you. Our next question comes from the line of Ramsey Ellis, all with Barclays. Please proceed with your questions.
Thank you.
Your next question comes from the line of Ramsey El <unk> with Barclays. Please proceed with your question.
Speaker 5: Hi, thanks for taking my questions and I appreciate it. And congratulations on solid results in the fourth quarter here. I wanted to ask about CAPEX as a percentage of revenue. It looks like it moved up to 4% from 3% where it's been from quite some time. Now, I know Ron called out a lot of critical business investment, but I'm just wondering, should we view the investment you're making as more kind of cyclical in nature? And meaning you'll kind of finish with this investment cycle and maybe CAPEX, the percentage of revenue, will tick back down again or is it sort of what we should expect in terms of a new level of business investment going forward?
Hi, Thanks for taking my questions and I appreciate it and congratulations on solid results in the fourth quarter here.
I wanted to ask about Capex as a percentage of revenue it looks like it moved up to 4% from 3%, where it's been for quite some time now I know Ron called out a lot of.
Critical business investment, but I'm, just wondering should we view the investment youre, making is more kind of cyclical in nature, meaning youll kind of finished with this investment cycle and then maybe capex as a percentage of revenue will tick back down again or is this sort of what we should expect in terms of a new level of business investment going forward.
Speaker 3: Hey, Ranze, it's Ron. I'd say probably the latter. Probably think about this level, this four percentage level, and the two drivers.
Hey, Ramsey, it's Ron I'd say, probably the latter probably think about this level this 4% ish level in the two drivers.
Speaker 3: kind of new things in the last couple years would be that Brazil network bill about that we've referenced before.
New things in the last couple of years would be that Brazil network build out that we've referenced before.
Speaker 3: So a fair amount of cost and getting those incremental 2000 stations up. And then two, we've here marked a fair amount of incremental money for the IT transformation. So not just enhancing obviously the systems we have but effectively building new ones in parallel. So I'd say those couple things would have, at least probably a couple more years to run and then they bought them back down.
So a fair amount of cost and getting those.
Incremental few thousand stations.
And then two we've earmarked a fair amount of kind of incremental money for the transformation. So not just enhancing honestly the systems, we have been effectively building new ones in parallel so I'd say those couple of things would have at least probably a couple more years to run and then they bought them back out of it.
Speaker 5: Okay, thank you for that. And on Capitol deployment or balance sheet deployment more generally, maybe Ron, if you could give us your view on the appetite for sort of a first buybacks versus M&A. And then on the M&A side, I'm really curious to see whether you are seeing more opportunities emerge or the deal pipeline increasing just because evaluation environment seems to have shifted down quite a bit. It might be a little too soon, but I'm just curious what you're seeing out there.
Okay. Thank you for that and.
On capital deployment, our balance sheet deployment more generally maybe Ron if you could give us your view on the appetite for sort of a first buybacks versus M&A and then on the M&A side I'm really curious to see whether you are seeing more opportunities emerge or deal pipeline, increasing just because the valuation environment seems to have shifted.
Down quite a bit it might be a little too soon but I'm just curious what youre seeing out there.
Speaker 3: Good question. Now, so I'd say that our priorities are unchanged, right? We're first M&A if we like it for capabilities and or it's creative. But as you can tell from Chex Comments earlier, we...
Yeah. Good question, so I would say that.
Our priorities are unchanged Ramsey right, where first M&A, if we like it for capabilities afterwards accretive, but as you can tell from chucks comments earlier.
Speaker 3: of half billion shares, we've bought back in the last 12 months.
When we say $6 5 billion shares we bought back in the last 12 months.
Speaker 3: I think that a bit of an appetite for our own stock, which we think is a pro.
So we've had a bit of an appetite for our own stock, which we think is appropriate.
Speaker 3: In terms of the M&A, we did press the pause button call it three months ago when we saw the volatility both in our own stock end and some of the others in our category. And so literally post this, we're going to kind of reach back out to some of those things that are super late in the pipeline and test.
In terms of the M&A, we did we did pressed the pause button.
Call It three months ago, when we saw the volatility both on our own.
Stock in and some of the others in our category and so literally post this.
We're going to kind of reach back out to some of those things that are super late in the pipeline and test.
Speaker 3: you know, where sellers are basically. We've got a view of where we are now. So I'd say, you know, ask me again in 30 days whether sellers have got the message that, you know.
Where where salaries are basically we've got a view of where we are now so I would say.
Ask me again in 30 days weather.
Sellers have gotten the message that.
Speaker 4: volatile and maybe there's a lower price that they'll take.
Things are volatile and maybe there's a lower price to fill up that they'll take.
Okay. Ron Thanks, so much that was really helpful. I appreciate it.
Speaker 1: Thank you. As a reminder, we ask that you please limit to one question and one follow-up. Our next question comes from the line of Darren Peller with Wolf Research. Please proceed with your questions.
Thank you.
As a reminder, we ask that you please limit to one question and one follow up.
Our next question comes from the line of Darrin Peller with Wolfe Research. Please proceed with your question.
Speaker 2: Hey, thanks guys. Nice end to the year. When we look forward on the fuel segment, on a stack basis, you're running in the low single of the gym range now, but I think embedded in your outlook is definitely an acceleration. Can you talk through that a bit in terms of the OTR side versus the sweets, the local fleets, and really how you're going to, you know, bridging from the run rate now to a higher level of growth. And then as you have the quick follow up on the corporate hand side.
Hey, Thanks, guys.
<unk> entered the year when we look forward on the fuel segment.
Tac basis Youre running in the low single digit range now, but I think embedded in your outlook is definitely an acceleration can you can you talk through that a bit in terms of the OTR side versus the fleets the local fleets and really how youre going to bridging from the run rate now to a higher level of growth.
And then as a quick follow up on the corporate payment side.
Speaker 3: And Darren, hey, it's Ron. Yes, I'd say the guy invented in the guy for 22 would be high single digits for fuel cars. So off of obviously more normalized comps this year. And part B, yes, the OTR, which is, I don't call it 30% of our business globally.
Yeah, Darrin, Hey, it's Ron Yes, I'd say.
The guy embedded in the guide for 'twenty, two with the high single digits.
For fuel cards, so off of obviously more normalized comps this year.
Alright.
The OTR, which is I'll call it 30% of our business globally.
Speaker 3: here Europe and Brazil continues to run softer, right? The COVID impact and getting drivers has softened that business more. So I think inside of our high single digit, that thing would be a smidge softer than the local or partner business. Okay. You've had a decent sales.
Ross here, Europe and Brazil.
Can you just run softer right, the COVID-19 impact and getting dry versus soften that business more so I think it's inside of our high single digit that thing would be a smidge softer than than the local apartment business.
Okay, you had a decent sales.
That's probably flowing through right now.
Speaker 4: You have to sit. You kind of cut out of it, but if you said we had decent sales, I mean, we've had literally record sales. Yeah, the boss of the studio car business.
Yes, you kind of cut off it but if you said we had decent sales I mean, we've had literally records.
The fuel card business.
Speaker 6: I'm trying to figure out when the cross sell you think is going to really kick into full year for court pay.
Alright, yes, I figure that's flowing through and starting now just a quick follow up on the corporate payment side, I mean really I'm trying to figure out when the cross sell you think is going to really kick into full gear for core PE right. When we think about the opportunity in <unk>.
Speaker 6: Really this software and invoice payside versus the virtual car alone, but really the holistic offering. Where do you think we're going to be? When do you think we're going to be in a full scale effort around that and issue that? Which sounds like I know there's been a lot of good industry chatter on it, but I could probably throw through to some meaningful trends. Thank you guys.
The software and invoice pay side versus the.
The virtual card alone, but really the holistic offering where do you think we're going to be when do you think we're going to be at a full scale effort around that initiated which sounds like I know there's been a lot of good industry chatter on it but.
That would probably flow through to some meaningful trends thanks guys.
Speaker 3: Another good question. I'd say probably another quarter or so, and let me tell you why. So we started out all in the second half testing, going out to call the 1,000 clients, 2,000 clients.
Yes. Another good question, I'd say, probably another quarter or so and let me tell you why so we started out call. It in the second half testing going out to call. It a thousand clients 2000 clients.
Speaker 3: putting them on a new payment platform. Seeing that they had an interest in our new platform, bill pay solution.
Putting them on a new payment platform.
They had an interest in our new platform.
Bill pay solution.
Speaker 3: and then we saw some decent reaction to it. And so what we decided to do is kind of be careful in...
It's a decent reaction to it and so what we decided to use at least kind of be careful.
Speaker 3: changing the payment platform and basically presenting a new service at the same time. We want to be super cautious around not.
Changing the payment platform and basically.
Presenting a new service at the same time, we want to be super cautious around that.
Speaker 3: upstanding if you will the golden goose of these dual car clients. So we're moving to put that platform in against a broad set of clients, get them comfortable using that and then effectively, you know, present higher this add on for them. So my guess is probably somewhere in Q2 we'll be able to report out on it.
Offsetting if you will the Golden Goose of these fuel card clients. So we're moving to put that platform yet.
Against a broad.
Set of clients get them comfortable using that and then effectively.
Present higher this add on.
All of them. So my guess is probably somewhere in Q2, we will be able to report out on.
That's great that's good to hear and thanks guys.
Speaker 1: Our next question comes from the line of San Jose Croning with KPW. Please receive a your questions.
Our next question comes from the line of Sanjay <unk> with J P. W. Please proceed with your question.
Speaker 7: thanks good evening. Question on the expense growth obviously very strong coming out of the pandemic.
Good evening.
A question on the expense growth, obviously very strong coming out of.
Pandemic.
Speaker 7: sort of deflationary there. Can you just talk about how much is...
Sort of deflationary there.
Could you just talk about how much is.
Speaker 7: by inflationary pressure versus more investments you're making and kind of what you're assuming that's going to translate to in terms of top-line growth.
Driven by inflationary pressure versus more investments youre, making and kind of what youre, assuming that's going to translate to in terms of top line growth.
Speaker 2: Yes, I did. This is Charles. So he's friends growth you're seeing comes from a couple of different areas. One, we've got the hay, effects and a LED acquisitions that are rolling in.
Yes. This is Charles so the expense growth Youre seeing comes from a couple of different areas. One we've got it.
<unk> acquisitions that are rolling in.
Speaker 2: Number one, two, we got the normalization of the credit losses. We expect that to be quite a bit higher. So much for stock comp in there. Also related to the deals we've got ongoing integration costs.
Number one two and we got the normalization of credit losses, we expect bad debt quite a bit higher some extra stock comp in there also related to the deals we've got ongoing integration costs.
Apex.
Speaker 2: Integration is probably the most advanced, we'll have taken as a company, sort of really move them off their systems, closed redundant offices, et cetera. So it's a multi-year journey there, we're spending money to basically create synergies for the future, that's also kind of baked in, both in the fourth quarter here, as well as into our guide for next year. We are seeing some of the stationary pressure predominantly around staffing. So wages, in some of the call centers and such, we've taken measures to remedy that, as it relates to vendors a little bit.
Integration is probably the most advanced.
And as a company sort of really.
I'm off their systems closed redundant offices et cetera, that's a multiyear journey, there and we are spending money to basic.
We create synergies for the future. So that's also kind of beat teams both in the fourth quarter here as well as into our guide for next year, we are seeing some inflationary pressure predominantly around staffing so wages and so on.
On the call centers as such we've taken measures to remedy that.
As it relates to vendors a little bit.
Speaker 2: But I'd say that that will help us eventually as opposed to vendor payments and say our corporate payments are readout. So it's a tale of two cities, right? We're gonna have some additional costs from inflation, but we'll also get some benefit from it on the river.
But I would say that that will help us eventually as it flows through to vendor payments and senior corporate payments arena. So.
As a tale of two cities right, we're going to have some additional costs from.
From inflation, but we also get some benefit from it on the revenue side.
Speaker 3: It's OK, it's OK. It's fine. It's fine. Lately, just jump onto the last thing, Chuck said.
Hey, Sanjay it's.
It's Ron let me just jump over the last nine chipset, which would be some some of the increment is really directed.
Speaker 3: Some of the information is really directed by us, you know, choice that we made, and easy capabilities and sales, again, some testing and advertising things, and even an IT to really better position the business. We like to like the profit number we got to.
Choice that we made.
EDI capabilities.
Sales against testing and advertising things and even in it.
To date really better position the business, we like the profit number we got you.
Speaker 3: So in addition to the factors that Chuck just laid out, I do want you to hear that we chose and to chase some things that helped the company a lot of forward.
So in addition to the factors that Chuck just laid out I do want you to hear.
Chosen to chase and things that help the company on a forward basis.
Speaker 7: And I actually have a follow up question on the EV point. Yeah, I'm just curious Ron, like how you think.
Understood and I actually have a follow up question on the EV point.
I'm just curious Ron like how do you think the.
Speaker 7: that distribution channels are going to look like in the future. Some payment processors are partnered with the auto manufacturers. And I'm just curious how unconventional the partnerships that you're trying to forge are. I know you have some of them, but maybe you just speak to what you're targeting.
Distribution channels are going to look like in the future. Some of some payment processor is a partnered with like the auto manufacturers and I'm just curious how unconventional the partnerships that youre trying to forge our going forward I know you have some of them, but maybe just speak to what.
What you are targeting.
Speaker 3: Yeah, I think it's actually been the other way so far. I think that we announced again, a fall wanted kind of a new investment in software companies. I think companies that are working on software see people like us, you know, in leasing companies is the best distribution.
Yes, I think it's actually been the other way so far I think that we have.
Now again.
A follow on and kind of a new asset and software companies I think.
Companies that are working on software see people like us and leasing companies as the best distribution.
Speaker 3: don't fight into fleas, particularly as they're mixed and stuff. And so we continue to like our chances both offering that back to our client base because we're first to see if they're moving off of a fuel, a internal combustion approach to something else so we can spot it in our client base. And then we've got obviously lots of coverage generally right to bring new clients.
In the fleet, particularly at their as they're mixed and stuff and so.
We continue to like our chances.
Offering that back to our client base, because we're first to see if theyre moving off of.
A few internal combustion approach to something else. So we can spot in our client base and then we've got obviously lots of coverage generally right to bring new clients.
Speaker 3: you know, into the fold. And so I'd say for sure, our distribution capabilities are probably as good as any. With that said, we did mention the Brazil thing.
We ended the fall and so I'd say.
For sure our distribution.
Capabilities is probably as good as any with that said we did we did mentioned the Brazil thing.
Speaker 3: a bit of a case study where we've now basically put tags, effectively told us.
Which is a bit of a case study where we have now.
Basically put tax effectively toll tags.
Speaker 3: In with three or four partners, literally as those cars come off the line. So when you buy your new Kia, whatever that could is, Nissan in Brazil, it's got to separate our tag when you come out. So look, we think over time these cars will fundamentally come off the line connected where they're sending data every couple of seconds. And so we mostly want to be set up just to grab that at relationships where we have access.
In with three or four partners literally as those cars come off the line. So when you buy your new key whatever the heck it is Nissan.
Brazil, It's got some prior attack when you come out so look we think over time e-commerce .
Fundamentally coming off the line connected where they're sending data every couple of seconds. So we most you'd want to be set up just to grab that relationships, where we have access to that connected car information and can then help again the client whether is that a public location work location or at home basically.
Speaker 3: to that connected current information and can then help again the client, whether he's at a public location, or a location or at home, basically pay for the thing. So I would say if they did earlier in the office, we're just so much smarter on this transition now at how to play and how we're managed or not.
Pay for the thing so.
I would say as stated earlier the office. We are just so much smarter on this transition now and how to play our damaged or not and what help we need so I don't know if we're communicating it.
Speaker 3: What help we need, so I don't know if we're communicating it. Well, but we are just in a way better spot than we were.
Well, we are just in a way better spot than we work.
Speaker 1: Thank you. Our next question comes from a line of Trevor Williams with Jeffries. Please proceed with your question.
Thank you.
Our next question comes from the line of Trevor Williams with Jefferies. Please proceed with your question.
Speaker 8: Great, thanks. Good afternoon. I wanted to have another one on expenses kind of similar to what Sanjay was getting after. But so margins in Q4 were down about 300 basis points from...
Great. Thanks, Good afternoon, I wanted to ask another one on expenses kind of similar to what Sanjay was getting after but.
So margins in Q4 were down about 300 basis points from third quarter. Despite all the revenue upside.
Speaker 8: third quarter despite all the revenue upside. I mean, is this kind of a new stepped up level of spin that's just kind of rebased higher that we should just expect to run through 2022? Just going to ask we're thinking about.
Is this kind of a new stepped up level of the level of spend that's just kind of rebased higher.
We should just expect to run through 2022, just kind of as we're thinking about how much leverage you can get from your guiding to 14% revenue growth next year. If you do better than that if we get kind of another leg back just on on some of the.
Speaker 8: How much leverage you can get from, you know, you're going into 14% revenue growth next year. If you do better than that, if we get...
Speaker 8: kind of another like back just on some of the piece of the revenue pie that are still kind of lagging versus...
The piece of the of the revenue pie that are still kind of lagging versus 19, So just give us a sense for kind of what your how we should be thinking about.
Speaker 8: 19 so just give us a sense for kind of what you're for how we should be thinking about operating leverage going forward given that you've already out.
Operating leverage going forward given that you've already it seems like in the last couple of quarters. There has been a stepped up level of investment to kind of prepare for the new go to market strategy. Thanks.
Speaker 8: There's been a stepped up level of investment to kind of prepare for the new go to markets.
Speaker 2: Yeah, Trevor's Charles and say that, you know, it is a bit of a reset to some of the acquisitions that we bought, do operate it slightly lower margins. So they're dealing with big airlines or insurance companies right there, they're very, very focused on the rates they pay. And they're also required very, very high levels of service. And so we need to make investments. And as the airline volumes are revenue is pouring back, we need to staff up to accommodate the service level of work required.
Yes, Trevor it's Charles I would say that it.
It is a bit of a reset so some of the acquisitions that we bought to operate at slightly lower margins.
You're dealing with big Airlines or insurance companies I think are very very focused on on the rates. They pay and they are also require very very high levels of service. So we need to make investments and as the airline volumes revenue and supporting.
To staff up to accommodate the service level.
Speaker 2: So I think the 54% is probably a good assumption going for next year. And as Ron mentioned, we are continuing the next investments for future growth.
So I think the 54% was probably a good assumption going for next year.
Ron mentioned, we are continuing to make vessels for future growth.
Speaker 2: So I'd say, you know, operating margins should hold at that level for the remainder of.
I'd say operating margins should should hold at that level for the remainder of.
This year.
Speaker 8: Okay, got it. And then Charles, just to follow up on interest expense, it sounds like you guys have three hikes built in to what you're guiding to for 22. Can you give us a sense just to, and even if it's not an exact number, that's fine. But if we end up at five or six hikes, what the interest expense sensitivity could look like in that scenario.
Okay got it and then Charles just a follow up on an interest expense. It sounds like you guys have three hikes built in.
You're guiding to for for 'twenty, two can you give us a sense just and even if it's not an exact number that's fine, but if we ended up at five or six hikes, what the interest expense sensitivity could look like in that scenario. Thanks.
Speaker 2: We've got about 5.9 billion that were flowed with LIBOR. So for every 25 basis points, you're looking at kind of 14 to 15 million of incremental annualized.
And we got about five 9 billion outflow with LIBOR. So for every 25 basis points Youre looking at kind of 2000 $14 million to $15 million of incremental annualized expense. So you've got a layer that in over time.
Speaker 2: So you got to lay that in over time. On the flip side, we do have customer deposits and cash balances that sit around the world and learning pretty good interest on us.
The flip side, we do have customer deposits and cash balances.
Around the world, we're running pretty good interest on notes and so.
Speaker 2: If interest grades continue to rise around the world, we might actually see that benefit. Yeah.
Interest rates continue to rise around the world, we might actually see a net benefit.
Got it okay perfect. Thank you.
Yes.
Okay.
Speaker 2: Thanks Trevor. I apologize for the technical difficulties. Looks like we're going to take tension next. Thanks, Chef. I can't promote it. How much do we take tension?
Thanks Trevor.
Talking about the difficulty it looks like we're going to take tension next.
Thanks, Jeff I can't promote.
Alex can you take it.
Yeah.
Okay.
Alright, guys, let's see if we can.
Over the next one.
Now, let's hear it.
Yeah.
Yeah.
Okay, Yes, we can hear us.
But I don't know where.
Yes.
Right.
Hey, guys give us just a minute.
[noise].
Yeah.
Speaker 2: Okay, well, while we wait for that gets scored away, Pete's questions from earlier were, how should we think about expectations on the corporate one SMB initiative, factoring into the guide, trying to understand if there's upside opportunity versus normalized forward payment growth expectation.
Okay, well, while we wait for that to get squared away.
Questions from earlier.
Or how should we think about expectations on the corporate SMB initiative factoring into the guy trying to understand if there is upside opportunity.
Normalized corporate payments growth expectations.
Speaker 3: Yeah, can people hear us? Yes, they're listening to us. You know, speed enough, you can hear, but it's run. So I kind of answered a bit of this earlier that we're going to get slower to be cautious on the cross-dial and we are obviously selling to new prospects in the market. So I'd say it would be pretty minimal. So if you look at our overall corporate payment.
Yes people Harris.
Yes.
Steve I don't think you can hear but it's Ron so.
I kind of answered a bit of this earlier that will go into a bit slower to be cautious on the cross sell and we're selling to new prospects in the market. So I'd say.
It would be pretty minimal. So if you look at our overall corporate payments.
Speaker 3: Guide to the year the SMB piece would still be relatively small Again mostly because we're trying to be careful and make sure we have the the acquisition economics right so
For the year, the SMB piece would still be relatively small.
Again, mostly because we're trying to be careful and make sure we have the the acquisition economics right. So.
Speaker 3: terms of upside and I think yes since we don't have scalable views of that yet I say as we get into the second half and get through some of the testing that's going to go on it could be some upside. We could step on the gas there a bit if we like what we're seeing and maybe lift the growth rate as the second half.
In terms of upside I think.
Since we don't have.
Scalable.
Is that yes, as we get into the second half and get through some of the testing thats going to go on.
Would be some upside we could we could get.
Step on the gas there if we like what we're seeing.
And maybe.
Lift the growth rate in the second half.
Speaker 2: Okay, and then another question is, can you flesh out the Brazilian banking relationship a bit? How do you see this impact in the value prop, and how could this impact user revenue growth?
Okay and then.
Another question is can you flesh out the Brazilian banking relationship a bit how you see this impacting the value prop and how could this impact your revenue growth going forward.
Speaker 2: Yeah, so we've completed the joint venture with Kaisha Bank. It's the largest bank in Brazil. Tends to focus a bit more down market. So if you look at our historic center, our business.
Yes so.
So we've completed the joint venture with <unk> Bank, the largest bank in Brazil tends to focus a bit more.
Our down market. So if you look at our historic for our business.
Speaker 2: You tend to focus a bit more on, I don't say half-load, but kind of more middle-class users and such. And with Kai, she will be able to one, move a bit down market and leverage all of their distribution capabilities. So all of their branches, their ATMs, et cetera.
We tend to focus a bit more on I don't say ask one but kind of more middle class.
As such and with cash we will be able to to one moving down market and leverage all of their distribution capabilities. So all their branches their atms et cetera, and so.
Speaker 2: So we view it as extensive distribution, but also reaching a slightly different segment.
So we view it has extensive distribution, but also reaching a slightly different segments.
Speaker 2: around the country that we just weren't as focused on.
Around the country that we just weren't as focused on historically.
Speaker 3: Let me just jump on to him and talk about it. Hey, it's Ron. I would just add to it that we love. Um.
So let me just jump on top of it.
It's Ron I would just add to it we love.
Speaker 3: How incremental different distribution channels are. So when we bought the business...
How incremental different distribution channels are so when we bought the business I can't remember, 70%, 80% of all do sales came through the stores kiosks and stuff in the stores.
Speaker 3: I care, remember, 70 or 80% of all due sales came through the stores. Key Austin's about to start the stores.
Speaker 3: and in toll booths where people were waiting in line and we diversify that and do digital hang things, the retail, outbound sales, et cetera, and then a whole slew of partners, including the manufacturers, the truck reference. So what I say most is we just love the incremental nature of a bank.
And the toll booths, where people were waiting in line and we diversify that into.
Digital hang things retail outbound sales et cetera, and then a whole slew of partners, including the manufacturers that Chuck referenced so.
When I say most of these we just love the incremental nature of a bank and those pounds those relationships and being in that channel. So we haven't put a ton into the guide yet because that thing just left it off I think a couple of months to three months ago, but we are super excited about it because it is the single largest bank.
Speaker 3: and those accounts and those relationships and being in that channel. So we haven't put the time into the guide yet because that thing just lifted off. I think a couple of months, two, three months ago. But we are super excited about it because it is the single largest bank.
Speaker 3: a larger set of account holders in the entire country. And so we're super hopeful, again, that that'll be additive at a check point because it targets this slightly different set of user than the traditional one.
Our largest set of account holders an entire country.
And so we're super helpful again that that'll be additive and a checkpoint.
It's a slightly different set of user than the traditional one.
Okay.
And I think we had Alex back.
Yes.
Speaker 1: Ladies and gentlemen, we apologize for the technical difficulties. We will now take our next question. Our next question comes from the line of TN Singh Huang with JP Morgan. Please proceed with your question.
Ladies and gentlemen, we apologize for the technical difficulties, we will now take our next question.
Our next question comes from the line of Tien Tsin Huang with Jpmorgan. Please proceed with your question.
Speaker 5: Hey Ron Charles Demis, Andrew actually on for Dengian. I'm congrats on the quarter.
Hey, Ron Charles Jim, It's Andrew actually on for Tien Tsin I'm congrats on the quarter.
Speaker 3: I wanted to ask a question on retention. So obviously still running strong compared to pre-pandemic. A little bit of a slide quarter over quarter, but what I wanted to ask was, you guys started to sell more services in bundles with the corporate pay integration. But there'd be any list in terms of retention as you sell potentially stickier products.
I wanted to ask you.
I wanted to ask a question on retention, so obviously still running strong compared to the pre pandemic, a little bit of a slight quarter over quarter, but what I wanted to ask as you guys start to sell more services and bundled with the corporate pay integration could there be any lift in terms of retention as you sell potentially.
Your products.
Speaker 3: Yeah, Andrew, it's raw. Yeah, we actually have statistics on that. So we, we're looking at different cohorts.
Yeah, Hey, Andrew it's Ron Yeah, we actually have.
Statistics on that so we look at different cohorts similar sets of clients that look at whether they have 123.
Speaker 3: Similar sets of clients and look at whether they have one, two, three kinds of services and your thesis is absolutely...
Three kinds of services.
Sure.
Thesis is absolutely right that as you move beyond one service you are stickier with clients.
Speaker 3: that as you move beyond one service, you're stickier with clients of a deeper relationship. Yes, so to the extent that we get what we call our platform or a bundle to work, and someone had walked around products, and then we were able to get there, their central bill pay, we do think we'll get a lift.
Deeper relationship, yes, so to the extent that we get what we call our platform or bundled to work and someone had walk around products and then we were able to get there your central Bill pay we do think we will get a lift and particularly when the final could include smart business cards for fuel cards, which is a prolonged walk around.
Speaker 3: And particularly when the bundle could include smart business cards or fuel cards, which is a param to walk.
<unk>.
Speaker 6: Great, thank you. Just one more quick follow up. I was just curious, whether any hiring pressures or wage pressures that impacted your clients, whether it be in the fuel or corporate payment side, that might have been a little bit of a headwinds or a results disclosure that could expect to normalize every time. Thank you guys.
Okay.
Great. Thank you just one more quick follow up I was just curious were there any hiring pressures or wage pressures that impacted your clients whether it be in the fuel or corporate payments side that might have been a little bit of a headwind to results. This quarter that you could expect to normalize over time.
Thank you guys.
Speaker 3: Yeah, we had a little bit actually, Chuck, we're, we're part of this earlier in our, in our lodging business, where we have a decent size service.
Yes, we have a little bit actually Chuck referred to this earlier in our in our lodging business, where we have a decent size.
Harnessing group.
Speaker 3: which is one of the lowest wage groups kind of in the competition. So I'd say that's the place that we fell some pressure and responded to that in the fall, both the retention.
Which is one of the lowest wage groups kind of in the company and so I'd say, that's the place that we felt some pressure and responded to that in the fall both to retain people that we were losing and and to add additional people I think like the rest of.
Speaker 3: people that we were losing and to add additional people. I think like the rest of corporations in America were seeing some pressures in different areas and IT digital, certain pockets. But...
Corporations in America, we are seeing some pressures in different areas and it did.
Digital.
Certain certain pockets, but we basically a build that and again to the guide I think it is.
Speaker 3: We basically have built that in again to the guide. I think it's been going on for call three to six months.
Hold on for call it three to six months.
Speaker 2: So I think we're comfortable with what we've learned. It ended just to pick up on that. I think you were talking maybe wage pressure on some of our customers.
So I think we're comfortable with what we planned it Andrew just to pick up on that I think you were talking.
Pressure on some of our customers and what I'd say, there we have seen that in logic in particular, and some of our workforce lodging business, which must recover but just not to the extent that we.
Speaker 2: And when I say there, we have seen that in lodging in particular. And so our workforce lodging business, which has recovered, which is not the extent that we...
Speaker 2: where it could is that they've had to actually small businesses turn down jobs and I can't travel there and do the work because I can't hire the people.
Where it could is that they've had to actually small businesses turn to Alan jobs, and I can't travel there and do the work because we can't hire people and so it'll be interesting to see as government subsidies and other things.
Speaker 2: So it'll be interesting to see as government subsidies and other things fall outside and see what happens to the employment market. Well, we think there is some upside opportunity there. I haven't built a whole lot into the plan a little bit, but not a whole lot. But wait, see, maybe track drivers too. Yep.
What happens to the employment market, but we think there is some upside opportunity there.
Having built a whole lot into the plan a little bit, but not a whole lot of wait and see maybe truck drivers too.
Alright, Thank you guys. Thanks, Andrew.
Our next question comes from the line of Bob Napoli with William Blair. Please proceed with your question.
Speaker 5: Hi, good afternoon and nice job on the quarter. Ron, I guess could you give some color on your expectations for the growth of the corporate payments business in 2022 and I guess over the medium term and maybe the various pieces for way P versus versus cross-border versus other.
Hi.
Good afternoon, and nice job on the quarter.
Ron.
I guess could you give some color on your expectations for the growth of the corporate payments business.
In 2022, and I guess over the medium term and maybe.
The various pieces full AP versus versus cross border.
Versus other.
Speaker 9: I sure bought my say the guy for that business in totalities in the high team.
Sure Bob I would say the guy for that business in totality is in the high teens.
Speaker 3: And again, to your point, there's different pieces, the payables portion of that.
And again to your point Theres different pieces, the payables portion of that.
Speaker 3: You know, virtual cards full AP check mentioned the full AP I think grew 50% last quarter. So that overall bit faster
Virtual cards full AP, Hi, Chuck mentioned, the full AP I think grew 50% last quarter, so that will grow a bit faster.
Speaker 9: the partner business that we called out will grow slower than that and probably the cross-border business will be closer to the mid-team.
The hardware business that we called out our grow slower.
Then that and probably the.
Cross border business would be closer to the mid teens, so there'd be maybe those different pieces in it and then you asked me. This every time he could you grow it faster, we'll obviously, if we could spend more money, but again, we try to balance.
Speaker 9: So there'd be those different pieces in it. And then you ask me this every time, hey, can you grow a faster will obviously, if we could spend more money, but again, we try to balance.
Speaker 9: what we spend to get a growth target, and a profit target, and spend wisely, so that we don't again have 50% new people or advertising that doesn't work. So we try again to be disciplined in terms of, you know, productive in terms of the money that we...
What we spend to hit our growth targets and a profit target and spend wisely. So that we don't again have 50% new people or advertising that does it doesn't work. So we try again to be disciplined in terms of productive in terms of the monies that we spend.
Speaker 5: Thank you. Then a follow up question. Ron, as you've called out at the beginning to call, I mean, CICOR has 15 proprietary acceptance networks. I think for your fuel card business, are that many necessary? Is there, how do you think about those proprietary acceptance networks versus leveraging an open-new network?
Thank you and then follow up question.
Ron as you called out at the beginning of the call Nucor has 15 proprietary acceptance networks I think for your fuel card business.
Many necessary is there how do you think about those.
Dietary acceptance networks margins leveraging can open loop network.
Speaker 10: What benefits are you getting out of that? Is there an opportunity to optimize?
What benefits are you getting out of that.
There are opportunities to optimize.
<unk>.
Speaker 9: That's a great question. The answer is, it's not only our fuel car business, it's kind of the underlying core of the company. So it's the same thing in lodging. We've got 15,000 hotels here in the US out of college. 45 or 50,000. We have super economics again. And unique data. We've got a toll network, for example. In Brazil, we have fuel networks in, I don't know, 10 countries.
Yes, that's a great question. So the answer is it's.
It's not only our fuel card business is kind of the underlying core of the company. So it's the same thing in lodging.
15000 hotels here in the U S out of call. It 45, or 50000 with silver economics again and unique data we've got.
Total network for example.
In Brazil, we have fuel networks, and I don't know 10 countries, where it is impossible for you or somebody to go try to create a proprietary.
Speaker 9: where it's impossible for you or someone to go try to create a proprietary network today. So I call it out really just to remind new people that those networks and the volume that we run through them and the data that we collect and the economics that we collect are just massively advantageous to us when we turn around to the client side, to the business account side, and picture off.
Network today, so I call it out really just to remind.
People that those networks and the volume that we run through them in the data that we collect and the economics that we collect.
Massively advantageous to us when we turnaround to the client side to the business account side.
And pitch are offered to us. So it was really just trying to let people know that it's not some plain vanilla jumping on someone else's network and everyone else basically has access to.
Speaker 9: So I was really just trying to let people know that it's not some planes in L.A. You know, jumping on someone else's network and everyone else basically has access to.
Okay. Thank you appreciate it.
Yes.
Speaker 1: Our next question comes from a line of David Togut with Evercore ISI. Please proceed to your question.
Our next question comes from the line of David <unk> with Evercore ISI. Please proceed with your question.
Speaker 10: Thank you very much. The lodging business did nicely exceed our forecast for revenue in the quarter. Could you walk through what your forecast is for lodging revenue growth in 2022? And if you could discuss some of the underlying drivers, the domestic business versus the international business and then talk a little bit about travel I.N. Which you acquired a couple of years ago. Are you seeing a nice recovery there?
Thank you very much the lodging business did nicely exceed our forecast for revenue in the quarter could you walk through.
Whats your forecast is for lodging revenue growth in 2022, and if you could discuss some of the underlying drivers kind of the domestic business.
Versus the international business, and then talk a little bit about travel clients, which you acquired a couple of years ago and are you seeing a nice recovery there.
Yes.
Speaker 2: Yeah, this is Charles. So, you know, a lot of you performing extremely well. We do have some continued recovery to go there, particularly in the airline space. So a lot of the performance you're seeing here is reflective of the domestic air travel. International has still been way, way down versus historic norms. To do that kind of swimming back up in next year. Workforce has a better room to recover, but it's also just, you know, chug along.
Yes, David this is Charles so.
Lodging performing extremely well, we do have some <unk>.
Recovery to go there, particularly in the airline space. So a lot of the performance you are seeing here is reflective of the domestic air travel International has still been way way down versus historical norms due to that kind of swinging back a bit next year.
For us it has a bit of room to recover but it's also just chugging, along and doing pretty well AOA business, which was a recent acquisition.
Speaker 2: pretty well. If ALE business, which was a recent acquisition, you know, a creative, a good buy for us, still work to do to to realize those synergies, but I say we're confident that the plans come together so that looks pretty good. In terms of that specific line of business or product category, I don't have
Accretive goodbye for us still work to do to realize those synergies.
We're confident that the plan is coming together, so that looks pretty good.
In terms of that specific.
Line of business or product category.
But in front of me.
Speaker 9: Get to everybody, it's Ron, I leave in here, Chuck is talking, so the guide on that thing.
Yeah, David Hey, it's Ron.
Leif adhere surface top and so the guide on that thing is plus 20%.
Speaker 9: plus 20% organically and obviously crazy high in the 40s on a print basis because we bought something, I guess close in September . And the drivers, again, of that are the sales plan is way up. I think the sales plan is up 35 or 40% is our plan for 22 and then what Chuck said did.
Organically and obviously crazy high in the Forty's on a print basis, because we bought something.
I guess it closed in September .
And the drivers again to that or the sales plan is way up I think the sales plan is up 35% or 40% is our plan for 'twenty two and then what Chuck said that super sensitivity and outlet, particularly the airlines for example about a quarter.
Speaker 9: sensitivity and that one particularly the airline for example about a quarter of that segment historically of our revenue came from international flights which in Q4 was still a
That segment historically of our revenue.
Came from international flights.
Which in Q4 was still effectively zero and so to the extent that the world opens at Airlines go back crossing borders again, let's say in Q2, we have the contracts and we're already serving the airlines.
Speaker 9: zero and so to the extent that the world opens and airlines go back crossing borders again, let's say in Q2, we have the contracts and we're already serving the airlines, you know, on the domestic links and so we've assumed a little bit of kind of bounce back in that kind of in the second half. So it's big sales, it's bounce back in the airline thing.
And on the domestic legs, so we've assumed a little bit of kind of bounce back in that kind of in the second half. So it's big sales.
Bounce back in the airline thing it's synergies that are baked into the recent acquisition. It's a big sales plan does just a lot of things going right in that business.
Speaker 9: Synergies that are baked into the recent acquisition, into big sales plan, there's just a lot of things going right.
Speaker 10: Thanks for that. Just a quick final question on capital allocation priorities for 2022. You've been very opportunistic with the stock at the current price. You've also been able to make some solid acquiescence.
Thanks for that just a quick final question on capital allocation priorities for 2022, you've been very odd.
Opportunistic with the stock at the current price you've also been able to make.
Some solid acquisitions whats your thought process for the year ahead. When you look at your stock at the current price versus what you have in the acquisition pipeline.
Speaker 10: So what's your thought process for the year ahead when you look at your stock at the current price versus what you have in the acquisition pipe?
Speaker 9: You know, we're still buyers. I mean, I guess, you know, I mentioned in my opening comments that not only do we buy a couple million shares in Q4, but we made this issue with the board to keep buying at the price into January , right, through a 10B5. And so I know where this box is gonna be, but at this price were buyers. And, you know, I think Chuck said it super well, they were earlier that with the liquidity we have, you know, with billion.
Yes, we're still buyers.
Yes.
Mentioned in my opening comments.
That not only do we buy a couple of million shares in Q4, but we made a decision with the board to keep buying at the price into <unk>.
Into January right throw through <unk>, five and so I don't know where the stock is going to be but at this price we're buyers and I think Chuck said, it super well, David earlier that with the liquidity, we have $1 billion.
Speaker 9: 5, 7, depending on what cash we elect to use, we can do a lot of things. This kind of stock price we can buy back still a lot more of the company. And as I mentioned, we're going to unpause a set of deals that we worked on in the summer end of the fall. And so, my guess, if you said to me, hey, we talking six months is you see us do both.
Seven depending on what cash we elect to use.
We could do a lot of things right at this kind of stock price. We can we can buyback still a lot more of the company and as I mentioned, we're going to on pause a set of deals that we worked on in the summer into the fall and so.
I guess, if you said to me Hey, we talk in six months as you see us do both.
Speaker 10: Understood. Thank you very much. Just good to talk.
Understood. Thank you very much.
Good to talk to you.
Speaker 1: Our next question comes from a line of George Mahalos with Cowan. Please proceed with your question.
Our next question comes from the line of George Mahalo with Cowen. Please proceed with your question.
Speaker 2: Hey guys, thanks for taking my questions. I guess for us just to build off a gave this question, the last one, can you sort of break down for us now the composition of revenue within logic from your traditional blue collar business of the airlines business now, just turning it a sense of how they are in terms of size and I wish I would be thinking about that bounce back in airlines going forward if it materializes.
Hey, guys. Thanks for taking my questions I guess first just too.
To build off of David's question the last one.
Can you sort of break down for US now the composition of revenue within lodging from your traditional blue collar business at the Airlines business now just trying to get a sense of how they are in terms of size and I was thinking about that bounce back in airlines going forward if it if it materializes.
Speaker 9: Yeah, that's a good question. So I think we probably will give the details of that, but we do think of it in three pieces or three verticals. So we have what we call workforce, which is...
Yes, that's a good question. So I think we probably all the details of that but we do think of it in three and three pieces or three verticals. So we have what we call workforce, which is the.
Speaker 9: You know, the original business we've owned for 10 years, which targets, you know, blue collar, travelers, you know, a tree cutting firm that goes, you know, when the power lines are down.
The original business, we've owned for 10 years, which targets blue collar travelers a tree cutting firm that goes when the power lines are down.
Speaker 9: And then a couple of articles that we've gotten into the last couple years of airline crew. So the airlines, again, it's a global business.
And then a couple of verticals that we've gotten in the last couple of years that the airline crew. So the airlines again, it's a global business.
Speaker 9: I'm 10% of the lodging rooms, I think, are crew around the world. So a nice segment for us to be. And then this newest one for us, a homeowner ensures basically put people when you have water damage or a fire, something like that to put people up and then put them into the longer term housing. So, you know, they're super unique.
There is 10% of the lodging rooms, I think our crew around the world. So a nice segment for us too.
And then there was one for us a homeowner.
<unk> basically put people when you have water damage or a fire or something like that to putting people off and then put them into a into longer term housing. So.
They're super unique things in terms of the systems that we integrate into right into the crew management system or into the claim system in the case of the insurer.
Speaker 9: things in terms of the systems that we integrate into right into the crew management system or into the claims system in the case of the insurer. The networks are a little bit different that we try to put together depending on who the traveler is. I say that the two newest things would be 40% just to give you a kind of a number relative to the workforce. Goodnight.
Network or a little bit different that we try to put together.
Pending on who the traveler is and so I would say that the two newest things would be circa 40% just to give you kind of a number.
Relative to the workforce megillah and the good news is all three of those again gorilla for the <unk>.
Speaker 9: And the good news is all three of those again are growing for the reasons that they haven't wanted a bit ago. Okay, that's just super helping.
He says that I outlined a minute ago.
Okay, that's super helpful.
And.
Yes.
Hey, Congrats Eric.
Yes George.
Speaker 4: Okay. Just a quick follow up on the expense, I don't know, it's something that's been talked about here, but if we look at 22, I mean, certainly sounds like
Okay.
Just a quick follow up on the on the expense side I know, it's something that's.
<unk> talked about here, but.
If we look at 'twenty two I mean, certainly it sounds like there are some expenses that are.
Speaker 2: There are some expenses that are somewhat more transitory, right? You've got a big increase as the bad debt normalizes and starts to come back. Obviously, you've got some integration costs, but can you just help us think about how much of those are a transitory specific to 22 versus sort of structural over the next several years as you accelerate investment to the cloud and your tech transfer.
Somewhat more transitory right, you've got a big increase as the.
Bad debt.
Normalizes and starts to come back obviously, you've got some integration cost, but can you just help us think about how much of those are.
Are transitory.
Specific to <unk> 22 versus sort of structural over the next several years as you accelerate investments to the cloud into.
Your.
Your tech transformation.
Speaker 9: Yeah, sure. Let me just wrong. Let me take the swing and then chuck them maybe to find a bit more detail. The way the way that I think about it, we think about it is...
Yeah, George Let me, it's Ron let me take a swing and then Chuck can maybe provide a bit more detail the way the way that I think about it we think about it is.
Speaker 9: What I call kind of discretionary expense, so that we think about the business.
What I'll call kind of discretionary expense, so that we think about the business.
Speaker 9: fitting there to operate and run the book of business we have, we need a set of expenses, right? We need IT to run and calm and people and credit and things like that. And then the big incremental expenses are really sales and IT and then a little bit of management to figure out, to figure out the way. And so those are gigantic. They're all those things. I'm talking about $6 to $700 million of our total of spend.
Sitting there to operate and run the book of business, we have we need a set of expenses right we need.
To Ron and calm and people in credit and things like that and then the big incremental expenses are really.
Sales at <unk>, and then a little bit of management to figure out to figure out the way and so those are gigantic there call those those things I'm talking about 6% to $700 million.
Speaker 9: Plan in 22 so that the call for us is really just how much do we spend in those things which again are 50% or more helping 2023 and 2024 right because by the time you sell the thing and get it on board If you do it by next, you know Thanksgiving, you know for the business of the following year you build an IT thing and roll it out for Christmas
Total expense.
Plan in 'twenty two.
<unk> for US is really just how much do we spend in those things which again.
Our 50% or more helping 2023 and 2024 right because by the time you sell the thing and get it on board and you do it by next Thanksgiving business or the following year, you're building it thing out roll it out for Christmas.
Speaker 9: So that's the message I think that you ought to hear is we've made the call when we like the revenue and profit, you know, guys that we can get to, to basically...
So that's the message I think that you ought to hear is we made the call.
When we like the revenue and profit guide that we can get to the basically chase some things that we liked that we think are additive and incremental in the future years and so the answer is it depends if those things go well, we will double down on them more if they don't we're probably back off.
Speaker 9: chase some things that we like, that we think are additive and incremental in the future years. And so the answer is it depends. If those things go well, we'll double down on them or if they don't, we're probably back off.
Speaker 9: If we need a different profit target, we may back off if we don't. So I say, those are the ones we kind of keep in our hands.
If we need a different profit target we may back off if we don't so I'd say.
Those are the ones, we kind of keep at our hand on the steering wheel and decide how much we want to do with it unless investors tell me. They don't they don't care about what our profits iron than then we might we might do more of it.
Speaker 9: On the steering wheel of design, got to how much we want to do with it. Unless investors still may, they don't care about what our profits are, then we might do more.
Speaker 9: I haven't heard that yet, so we're still balancing it.
I haven't heard that yet so.
Were still balancing it.
Okay. Thank you.
Yeah.
Speaker 1: Our next question comes from the line of Andrew Jeffery with Truist. Please proceed with your question.
Our next question comes from the line of Andrew Jeffrey with true with please proceed with your question.
Speaker 5: Thanks, I appreciate you squeezing me in. Ron, lots of pretty interesting initiatives, I think, first digital, which you noted is now half of fuel sales and the progress towards the platform selling motion. I'm trying to wrap my head around a little bit. And I don't expect you to speak to anything beyond 22, but is there anything...
Thanks, I appreciate you squeezing me in.
Ron lots of.
Pretty interesting initiatives I think first digital would you would you noted is now half of.
Fuel sales and the progress towards the platform selling motion.
I'm trying to wrap my head around a little bit.
And I don't expect you to speak to anything beyond 'twenty two but.
Is there anything.
Speaker 5: that we should be thinking about it sort of leaking out of the bottom of the funnel. If you're having success with more value added solutions, maybe expanded, spend on fuel cards, I'm not sure you called that out this quarter in particular, but all this stuff collectively.
That we should be thinking about as sort of leaking out of the bottom of the funnel. If you are having success with more value added solutions, maybe expanded spend on fuel cards I'm not sure you call that out this quarter in particular, but all of this stuff collectively.
Speaker 6: Should we think that maybe this business can grow faster at the current margin? Or is there's, I just want to make sure I'm not missing any, any puts and takes here that you'd want us to focus on?
Should we think that maybe this business can grow faster at the current margin or is there I just wanted to make sure I'm not missing any any puts and takes here that you would want us to focus on.
Speaker 9: It's a super good question Andrew and my answer a little awfully would be it depends.
Yes.
Super Good question, Andrew and my answer a little wobbly would be it depends so so what I would say to you is this direction, we're going of effectively re packaging and integrating.
Speaker 9: So what I would say is this direction we're going of effectively.
Speaker 9: repackaging and integrating um... you know a bunch of the products that we have has enormous incremental potential for the company because it'll be served up differently and it'll appeal to different businesses and then we're targeting today so the first message of trying to get everybody to say is we're on to something the leverages the capabilities we build over twenty years that is a TEDx kind of opportunity.
A bunch of the products that we have has enormous incremental potential for the company because it'll be served out differently and then it will appeal to different businesses, then that we're targeting today. So the first message I'm trying to get everybody to say is we're onto something that leverages the case.
Abilities, we built over 20 years.
Tax kind of opportunity for the company.
Speaker 9: the profits that we can make is going to be a function of the selling economics of that, which we're just getting into. So if you said to me, hey, how do you think the profit margins will look into the three years? My answer is probably pretty similar of the set of businesses that we have, because we've got great experience and history and statistics and we know the curves. We kind of know what we can produce.
The.
The profits that we can make is going to be a function of the selling economics of that which we're just getting into so if you said to me Hey, what do you. How do you think the profit margin is a look at two or three years. My answer is probably pretty similar of the set of businesses that we have because we've got great experience in history of statistics.
We know the curves we kind of know we can produce I would say, we don't know that answer for some of these platform things and so.
Speaker 9: I would say we don't know that answer for some of these platform things. And so if those things sell kind of in a line average or even a bit too worse, I think you'll continue to see growth with similar kinds of margins. And if not, then we'll fight that fight when we get there and ask people, hey, would you rather see accelerated revenue at slightly lower margins? That's the conclusion. But it's really just a bit too early to call.
If those things sell kind of in line average room, even if it's worse I think youll continue to see.
<unk> growth was similar kinds of margins and if not then we will.
I'll fight that fight when we get there and ask people, Hey would you rather see accelerated revenue with slightly lower margins.
The conclusion, but it's really just a bit too it's a bit too early to call.
Speaker 6: Okay, that's helpful. And then just philosophically or theoretically as a follow up. Is this a business that at some point you'd like to-
Okay.
Helpful. And then just philosophically or theoretically as a follow up.
Is this a business that at some point you'd like to.
The simpler.
Speaker 6: Or do you feel really good about all the businesses you're in? I know GIF is sort of been kind of a mixed bag.
Or do you feel really good about all of the businesses you're in I know gift has sort of.
Then kind of a mixed bag over the years.
Speaker 9: Yeah, I think we, it's a great question. I think that, you know, it's the oldest advantage point. Like, we made the great idea of talking to you guys and about the people about, you know, the way we run the company and we have these different things and stuff. When we sit around in the company, it's really pretty simple. Like I try to say in my opening remarks, that basically we just work for business.
Yes.
Great question I think that.
It's the OLED the vantage point like we made the great idea or talking to you guys and by type people about the way we run the company and we have these different things and stuff well.
Sit around in the company, it's really pretty simple I tried to say in my opening remarks, basically we just worked for businesses.
Speaker 9: And we work on their expenses or their spend, and we try to reduce it. And the programs that we created, you know, control, you know, what they buy and what they pay for. So for us.
And we work on their expenses or their spend and we try to reduce it and the programs that we created.
Control.
What they what they buy and what they pay for it so for us.
Speaker 9: you know, whether it's a lodging room, a piece of spend or a fuel or a business card, a piece of spend or a vendor, it all looks like a business expense that we're trying to help control. And the reason that it seems complicated is we've made like super specialized ways to do it. So we ended up like talking to everybody, hey, let me tell you about the super secret sauce I use in lodging versus whatever. And I think we're gonna start to talk to the marketplace, your point a little simpler and just say, hey, look.
Whether it's a lodging room pieces band or a fuel our business card fees spend or a vendor. It all looks like a business expense that we're trying to control and the reason that it seems complicated it we've made like super specialized ways to do it. So we ended up talking to everybody and let me tell you about the Super secret sauce I use them.
Lodging versus whatever.
I think we're going to start to talk to the market place to your point, a little simpler and just say hey look we're about trying to help you spend less on kind of non payroll expenses and we've got Super Special staff and we've got kind of more generalized stuff, what's your need and we've got a product line and let's see if we can help you and maybe.
Speaker 9: We're about to try to help you spend less on kind of non-veral expenses and we've got superficial stuff and we've got kind of more generalized stuff than what you need and we've got a product line, let's see if we can help you. And maybe get a back on up a little bit of all the detail that we provide everybody on how we make this off.
Get a back off a little bit of all of the detail that we provide everybody on how we make the sausage.
Speaker 9: Yeah, I think that could help a lot. Great. Very tight for time. Right, this selling, you know, the perfect example or whatever, like we use this pivot we made to digital. We use it everywhere in the company. We figured out how to build a tech stack. We figured out how to advertise. We figured out how to automate bidding. We figured out how to get applications processed through the system. We figured out how to make credit instant.
Yes, I think that can help a lot great very insightful.
It was a perfect example, or whatever like we use this period, we've made in digital we use it everywhere in the company, we figured out how to build a tech stack, we figured out how to add.
The advertised we figured out how to automate bidding we figured out how to get applications process through the system, we figured out in a credit instead, we've done like so many things that we can basically printing a copy.
Speaker 9: We've done like so many things that we can basically print and copy, you know, into the other businesses that we have. So I think you'll see more of that as we launch this platform line. You'll see us tucking the things that we have into the platform and they may see more of the same to people than different.
The other businesses that we have and so I think you'll see more of that as we as we launch this platform line Youll see us tucking the things that we have in the platform and they may see more of the same to be indifferent.
Speaker 11: Okay, look forward to that evolution. Thank you again.
Okay look forward to that evolution to thank you again, yes, you are welcome.
Speaker 1: Thank you. In the interest of time, we ask that you please limit to one question.
Thank you and the interest of time, we ask that you. Please limit to one question.
Speaker 1: Our next question comes from a line of Ken Sugoski with Autonomous Research. Please proceed with your question.
Our next question comes from the line of Ken Zuchowski with Autonomous Research. Please proceed with your question.
Speaker 8: Okay, good evening everyone. Thanks for taking the question. Ron, I wanted to follow up on some of the questions on EV. I think you mentioned in your prepared remarks that the EV economics are roughly in line with traditional fueling services. So can you provide some insight of what the EV economics might look like for the EV offering? It's impressive that the transition to EV is revenue neutral. So I'm just curious what's driving that. Thank you.
Hey, good evening, everyone. Thanks for taking my question Ron I wanted to follow up on some of the questions on on EV. I think you mentioned in your prepared remarks that the economics are roughly in line with traditional fueling services. So can you provide some insight on what the unit economics might look like for the <unk>.
The offering.
It is impressive that the transition to <unk> is revenue neutral. So I'm just curious what's driving that thank you.
Speaker 2: Hey, can this is Charles, a good question. And I actually had a, our analyst pulled data from...
Hey, Kevin This is Charles.
Good question and I actually had our analysts pooled data from.
Speaker 2: in another one, a country that's a little bit further ahead in terms of EV, migration in the UK, which is further ahead than the US. And there we have about...
The Netherlands, a country, that's a little bit further ahead in terms of the migration in the UK, which is further ahead in the U S.
And then we have about 18000 clients.
Speaker 2: And we said, okay, let's split those clients into two categories.
And we said, okay, let's split those clients into two categories are grouped at only buys fuel.
Speaker 2: group that only buys fuel. It has no e-mail. So I see.
It has no.
So I see internal combustion engine only.
Mixed fleets.
Speaker 2: And what I tell you is about 14% of the clients, about 2,500 clients, are mixed fleets. So they've got both types of vehicles.
And what I would tell you is about 14% of the clients about 2500 clients are mixed fleets.
Both types of vehicles.
Speaker 2: And they tend to be larger. So the enterprise level clients are moving faster. So the mixed leads average about 20 cards per account or vehicles per account. Whereas on the fuel only fleet, I see only fleets. They're about five cards per account. When I-
And they tend to be larger so the enterprise level clients, who are moving moving faster. So the mixed fleets average about 20 cards per per account or vehicles per account, whereas on the fuel only fleets ICD only fleet or about five cars per account.
When I look at those mixed fleets.
Speaker 2: The actual revenue per vehicle that we receive on EBS versus fuel, it's actually slightly hot.
The actual revenue per vehicle.
Steve on Evs versus fuel, it's actually slightly higher.
Speaker 2: And part of the reason is that these enterprise level clients give rebates when they go out in the fuel networks, which we provide to them, which we don't give on the EV reporting side. And so the economics.
And part of the reason is that these enterprise level clients to get rebates when they go out in the fuel networks, which we which we provide to them, which we do.
Reporting side.
So the economics turned out to be.
Speaker 2: neutral that is slightly favorable on the EV side.
Neutral to actually slightly favorable on the EV side.
Speaker 2: So without getting into a specific client level type of
And so without getting into specifics.
<unk> level type of bank.
Speaker 2: Red be parter. I'm telling you that the EV is about 20% higher for these mixed leaves. Out on.
Revenue per I would tell you that it is about 20% higher for these mixed fleets.
Now all of their cars they've got about.
Speaker 2: 15 to 20% over the EV already. So we're seeing some real data points here.
15% to 20% over already.
So we're seeing some real real data points here.
Speaker 2: But that just gives you a sense of who's moving, the size of counts that are moving, how far they've moved, and the economic kind of relationship there, and why it's this calm.
But that just gives you a sense of who is moving.
<unk> accounts that are moving how far they've moved.
And the economic kind of relationship there and why it's comparable.
Speaker 9: It can't. It's wrong. It's a super important question. So let me mean it's wrong. It's Jeff on them to what Chuck said. But to me, you know, there's a there wasn't as maybe a mass.
Ken It's Ron it's a super important question. So let me just jump on them.
Chuck said to me.
There was it is maybe a massive misconception.
Speaker 9: misconception that hey, when a business moves to EV, you're plugging in everything's free. So, you know, good-bye, free court, tough days. So the two things, and I can't not admit that some every years ago, I was worried when I was down there. But the two things that are clear are one, it costs way more to recharge an EV vehicle than people thought. Certainly when you do it public.
When our business moves to EV you plug it in and everything is free so goodbye fleet.
So the two things.
Can't not admit that some number of years ago I was worried when I was dumber.
The two things that are clear, our one gig cause way more.
The recharge an EV vehicle than people thought certainly when you do it publicly.
Speaker 9: You know, that's a huge markup on the electricity obviously because the charge point versus trying to make money and is way higher MDR for people like us because they're trying to build up volume. So the first misconception is, oh, it costs 50 bucks to fill up a van and only time to recharge them. So that's not...
Huge markup on the electricity, obviously, because the checkpoint versus trying to make money and is way higher MTR for people like us because they are trying to build up volume. So the first misconception is all cost.
50 Bucks to fill up a van and I to recharge event. So that's not true and then the second thing, which I think we all missed is most of the recharging is going to happen at all so there's millions of charge points that were not in the business today, we only do stuff.
Speaker 9: And then the second thing, which I think we all missed, is most of the recharging is going to happen at home. So there's millions of charge points that we're not in the business today. We only do stuff at stations. And so to me, those are the two things, where you go, oh my God, most of the recharging's going to happen at home, and it's going to be measured and reimbursed. So who's going to do it? So I just separate from the math that Chuck ran through. Or like just want to stick those.
Gas stations and so to me those are the two things where you go Oh My God. Most of the recharging is does it happen at all and it's got to be measured and reimburse so who's going to do it. So I just separate from the math Chuck ran through I just wanted to stick those concepts in People's head.
Speaker 9: concepts and people's heads that it is different than all the thought coming into the thing. There's more money helping businesses in this thing and it's going to cost them more than they think when they think about their ballpark.
Is that it is different than all of the thought coming into the thing theres more money, helping businesses in this thing and it's going to cost them more than they think when they think about their golf cart.
Extremely helpful. Thank you guys appreciate it.
Speaker 1: Our final question comes from the line of James Fawcett with Morgan's family. Please proceed with your question.
Our final question comes from the line of James Faucette with Morgan Stanley . Please proceed with your question.
Speaker 8: Hey, sorry about that, fumbling with my phone. Why to kind of follow up on that question and just ask on these minority investments, that you're going to be able to see
Hey, sorry about that following with my phone.
Wanted to kind of follow up on that question and just ask on these.
Minority investments that you've made I think at least in my mind the case to be made for managing those expenses and the costs associated with as you. Just highlighted are probably more significant than people may have imagined, but can you talk about strategically.
Speaker 8: At least in my mind, the case to be made for managing those expenses and the costs associated with it, as you just highlighted, are probably more significant than people may have imagined. But can you talk about strategically why or under what conditions?
Y or under what conditions, you do the minority investment versus acquisition, what you're expecting that to lead to down the road and how we should think about that trajectory of relationships and potential contribution directly to <unk>.
Speaker 12: You do the minority investment versus acquisition, what you're expecting that to lead to down the road, and how you should think about that trajectory of relationships and potential contribution directly to a fleet core.
Speaker 9: Did James A. A. S. Ronn has a good question? You know, it's kind of, you know, try before you buy. So the category is new.
Yes.
It's Ron it's a good question.
Kind of try before you buy so the category is new there's a couple of partners that we that we called out today have been working on software.
Pretty hard and stuff so for us, it's kind of a no brainer to be supportive to them give them money to keep kind of bill and we have obviously commercial agreements that.
Speaker 9: kind of a no brain or two be supportive to them, give them money to keep kind of bill. And we have obviously commercial agreements that, you know, state, you know, the economics and the roles of the two companies. And so we like it. We kind of get some people that are working on here in the US and some people that are working on in Europe . We integrated into this stuff we have. And you know, off we go. We've got a product that works. And so we can focus on trying to sell all this stuff, which is what, you know, those two partners are looking for. Obviously, do the extended thing as a soup.
State the economics of the roles of the two companies and so we like it we kind of get some some people have been working on here in the U S and some people that are working on in Europe , we integrated into the stuff we have and we go we got we've got a product.
Speaker 9: It works and so we can focus on trying to sell all the stuff, which is what those two partners are looking for. Obviously, to the extent that the thing is a super big deal, and we want to get more of the value chain, we would clearly look at other options and stuff down the road and then obviously in other geographies. But...
<unk>. So we can focus on trying to sell the stuff, which is what those two partners are looking for.
To the extent that thing is a super big deal and we want to get more of the value chain. We would clearly look at other options and stopped down the road and then obviously in other geographies, but.
Speaker 9: Initially we're super pleased with these partners. We screened a lot of them. We liked the offerings that we have. And we're still in the mode that I said they can. We're still trying to learn exactly what the client...
Initially we're super pleased with these partners, we screened a lot of them, we like the offerings that we have and we're still.
In a moment I said, Ken we're still trying to learn exactly what the clients want and need and to make sure that the products, including the software are dialed into that so we didn't want to get out over our skis.
Speaker 9: want and need and to make sure that the products, including the software, are dialed into that. So we didn't want to get out over our skis before we were, you know, we were clear.
Before we were we were clear.
Speaker 12: I mean, since and then you then just as a quick follow up you talked a lot about the strength we were seeing in things like hotel and recovery and travel. Can you just give us a little bit of of color on what we you saw as we went through the Omicron wave and and you know where you're at on a run rate trajectory if there was an impact there just just trying to measure near term sensitivity to recent events.
That makes sense and then.
Then just as a quick follow up.
Talked a lot about the strength, we're seeing in things like hotel on recovery in travel.
Can you just give us a little bit of color on what you saw as we went through the omicron wave in and where you're at on a run rate trajectory. If there was any impact there just just trying to measure near term sensitivity to recent events.
Speaker 9: not another good question. I say it, but smidge we...
Yes, another good.
Question I would say, it's a smidge we Chuck.
Speaker 9: Chuck and I obviously did a reconnaissance of Jane or with our folks. I think we had a bit more in Europe again, exiting December and a bit into Jane. We're gonna say it's a pretty soft month.
Chuck and I, obviously did a debt of recognizance.
January with our folks I think we had.
I had a bit more in Europe again.
<unk> December and a bit into January but I'd say, it's a it's a pretty soft month James for us anyway. So, let's michie impact obviously, we roll that into our guidance yesterday, we've had our eyes open the whole time and I'd say the most recent stock call. It the last week or two that's michie things kind of going in.
Speaker 9: James for us anyway, so a smidgey impact, obviously we've rolled that into our guidance. You have today we've had our eyes open the whole time and I'd say the most recent stock call the last week or two that smidgey things kind of go all the way. So it's, you know, I don't want to get over my close key here, but get sure feel and like we're coming out, you know, a bit into a clearing.
So it's I don't want to get over my skis.
Steve here, but it sure feels like we're coming out of it into a clearing.
Speaker 9: Finally, and again, I just want to reaffirm that the the forward numbers we give for 22 were pretty confident. And I'm sitting here, you know, beginning February . That's great.
Finally, and again I just want to reaffirm that the.
The forward numbers, we've given for 'twenty, two we're pretty confident sitting here beginning of February .
That's great. Thanks for all the great color on.
Yeah.
Speaker 1: Thank you. Ladies and gentlemen, we have reached to the end of the question and answer session. This concludes today's conversation.
Thank you ladies and gentlemen, we have reached the end of the question and answer session. This concludes today's call. Thank you Brian .
Speaker 9: Can we make just a quick comment? We just want to apologize to those on the call for the technical write-out. Hopefully it wasn't super confusing. So it was always appreciate the interest and the support.
Can we make just a quick comment.
We just want to apologize to those on the call for the tactical bite out of hopefully it wasn't super confusing. So it was always appreciate.
The interest and the support.
Yes.
Speaker 1: Thank you. This concludes today's conference and you may disconnect your lines up this time. Thank you for your participation. Have a wonderful day.
Thank you.
This concludes today's conference and you may disconnect. Your lines at this time. Thank you for your participation have a wonderful day.
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