Greetings. Welcome to the FleetCor Technologies Inc. 3rd 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 0 on your telephone keypad. Please note that this conference is being recorded. I will now turn the conference over to your host, Jim Eglseder, Head of Investor Relations. You may begin. Good afternoon, everyone, and thank you for joining us today for our 3rd quarter 2021 earnings call. With me today are Ron Clarke, our Chairman and CEO, and Charles Freund, our CFO. Following the 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. Please note our earnings release and supplement can be found under the Investor Relations section of our website at fleetcor.com. Now, throughout this call, we will be presenting non-GAAP financial information, including adjusted revenues, adjusted net income, and adjusted net income per diluted share. This information is not calculated in accordance with GAAP and may be calculated differently than non-GAAP information at other companies. Reconciliation of historical non-GAAP financial information to the most directly comparable GAAP information appears in today's press release and on our website as previously described. I do need to remind everyone that part of our discussion today may include forward-looking statements. These statements reflect the best information we have as of today. All statements about our recovery, outlook, new products and acquisitions, and expectations regarding business development and future acquisitions are based on that information. They are not guarantees of future performance, and you should not put undue reliance upon them. We do not undertake any obligation to update any of these statements. These expected results are subject to numerous uncertainties and risks, which could cause actual results to differ materially from what we expect. Some of those risks are mentioned in today's press release and on Form 8-K, and in our annual report on Form 10-K filed with the Securities and Exchange Commission. These documents are available on our website and at sec.gov. With that out of the way, I will turn the call over to Ron Clarke, our Chairman and CEO. Ron? Okay, Jim. Thanks. Good afternoon, everyone, and thanks for joining our Q3 earnings call. Up front here, I'd like to run through 4 subjects. First, give you my take on our Q3 results along with the rest of year outlook. Second, take you into a bit deeper dive into our sales results. Third, give you an update on the 3 acquisitions that we've completed year to date. Then lastly, an early preview of 2022 and beyond. All right, let me make the turn to our Q3 results. We reported Q3 revenue of $755 million, up 29%, and cash EPS of $3.52, up 25%. Both of those all-time record highs for the company. Also, the Q3 results annualize finally above $3 billion, so past the $3 billion mark in revenue, and $14 in cash EPS. Organic revenue for the quarter, up 17%, and inside of that corporate payments, business grew 22% organically. The trends in Q3 are quite good. Sales finishing at record levels, up over 50%, versus Q3 last year and over 30% against the baseline of Q3 2019. Retention, steady as she goes at 93% for the quarter. Again, our global fuel card business inside of that, also coming at 93%. Same-store sales, strengthened, +5% for the quarter, which further adds to the same-store sales rebound, we saw in Q2. Credit losses, low again at 3 basis points, continuing to run below historic levels. You may notice our tax rate kind of 4 points higher than last year. That did shave about 20 cents off the $3.52 that we reported for the quarter. Look, overall, pretty pleased with the quarter. In terms of rest of year, we're raising guidance today. Revenue guidance at the midpoint now $2.795 billion. That's up $30 million from August. Cash EPS at the midpoint of $13.05. That's up 15 cents from August. This raise versus last time reflects obviously these Q3 results that beat, the ALE Solutions acquisition, which closed September 1 and a bit more favorable fuel prices. All of those offset just a bit by slower than planned COVID recovery. If you look at the Q4, on its own, it anticipates revenue and profit growth up about 20%, versus Q4 last year and about 10%, against Q4 2019. All right, let me make the transition into a bit deeper dive into our sales results. As I mentioned, new sales or bookings reach record levels in the quarter and are up sequentially significantly and up dramatically over the prior periods. As I'm sure you're aware, sales reflect the market demand for our solutions, but are also really the best leading indicator of our future prospects. Crazy record this quarter, we signed up almost 50,000 new business clients globally in Q3, so 50,000 new accounts joined the fold, so a record. Over 50% of all of our global fuel card sales now come to us through our digital channels. Great because it's very low cost. We continue to increase our digital advertising spend, and we're enjoying record levels of prospects visiting our websites. Interest in EV solutions increasing, so a number of large accounts signing on to our EV solution. That included Hertz, Volkswagen USA, Union Pacific, LeasePlan Europe, and Siemens. Brazil toll sales rocked in the quarter. Our urban sales or kind of the city dwellers that are lower frequency toll users represented 23% of all new sales in the quarter. Programs, whatever, two or 3 years old now, almost a quarter. The active tags for the quarter reached a new milestone, 6 million. 6 million active paying tags now in Brazil. We are planning to launch our new bank JV this month with the largest bank in Brazil, who will be helping to promote our products. We don't talk about it much, but our customer acquisition cost is really quite attractive. Runs about 65% of the sales new revenue, so really super important for profitable growth. Let me shift gears and talk a little bit about the 3 acquisitions that we've closed year to date and how they're doing. Roger, first up, we've now rebranded Roger to be Corpay One, which is our entry into the corporate payments SMB space. We're underway now adding new SMB bill pay clients through digital channels and accounting channels, and have some early returns on cross-selling bill pay into our fuel card base. Super early, but it looks like about 10% of our fuel card clients that pay their bills with our new Corpay One platform are choosing to pay a second, you know, non-Fleet Cor bill with us. Effectively becoming bill pay customers. We're looking at somewhere around 10,000-20,000 SMB bill pay clients coming online in 2022. Also interesting, we plan to launch what we call our two-in-one solution before year-end that will combine our smart business cards with our bill pay platform into one interface. An SMB client could potentially pay all of their non payroll expenses with us on a single platform. Second deal this year, AFEX, which is a cross-border provider, very similar to our Cambridge business, super performance in 2021. Pro forma revenue growing mid-teens%, EBITDA up almost 50% versus prior year. Well along on integration, we've already combined the management teams into one group and are about halfway through migrating the AFEX customers onto the Cambridge IT platform. Hope to retire most of the AFEX IT system by year-end. Last deal up is ALE, that's the lodging extension for the insurance vertical. It helps homeowner insurance place policyholders into hotels and temporary housing. We closed that September 1. About 3.5 million incremental annual hotel rooms will be added to our lodging business. Underway with the synergy work, early view is about $0.20 accretive to 2022. So far so good really across all 3 transactions this year. All right. Lastly, let me share our early view of 2022 and speak a little bit to the Beyond 2022 prospects for the company. For next year, encouraged by a few things. First, the run rate. We're exiting 2021 with about $3 billion of annualized revenue and $14 of cash EPS. Nose of the plane is up. Sales again running at record levels, which will drive incremental revenue into 2022. We also expect sales to grow again next year, about 20%. Macro's on our side, helping us. Obviously, fuel prices are high. FX is generally holding, so setting up well there. I mentioned the acquisitions, particularly AFEX and ALE Solutions together contributing probably about $0.50 of incremental accretion next year. Look, taken together, the early 2022 setup is quite good. If we look just a little farther out, into the midterm, we're kind of also encouraged there for a couple reasons. First, we've expanded via our Beyond strategy, the market segments or the served market segments in each of our five major lines of business. That's laid out on, I think, Page 14 of the earnings supplement. For example, in Corpay, our corporate payments business, we've added cloud-based AP solutions to our original virtual card business. We did that a couple years ago in the middle market with Nvoicepay, and then obviously this year in the SMB market with Roger. Look, much better positioned now to attack the corporate payments TAM. Again, if you look, our lodging business initially focused only on workforce or blue-collar travelers going to economy hotels. Since we've added two new segments, the airline crew business and now the insurance policyholder business to the fold, that really triples the opportunity in terms of room nights for the lodging business. A second thing is we're on a path, as I mentioned, to combine our card business with our payables business into a single platform, which would do 2 things. First, give us differentiation in the marketplace, where we could help clients pay all their non-payroll expenses with us, both walk-around purchases and supplier payables from a single account. Second, could help us turn our fuel card business into a corporate payments business by cross-selling our bill pay services to our hundreds of thousands of fuel card clients. As I mentioned, underway there. Look, the combination of expanding, you know, our served market segments in our existing 5 businesses, along with this idea of joining up our cards and bill pay onto a single platform is encouraging for us. Look, in closing, a few final wrap-up thoughts. Again, a really good quarter. Record revenue and profits for Q3. Good trends. Same-store sales up. New sales up and retention steady. Again, record sales and very attractive cost of acquisition of new accounts. 3 acquisitions on track against our thesis. Our early 2022 setup attractive. Look, all in all, it feels like we're in a pretty good place. With that, let me turn the call back over to Chuck to provide some additional details on the quarter. Chuck? Thanks, Ron. I'm delighted to share with you some more color on a very solid, clean quarter. For Q3 of 2021, we reported revenue of $755 million, up 29%. GAAP net income of $234 million, up 24%. GAAP net income per diluted share of $2.80, up 28%. Adjusted net income for the quarter, or ANI, increased 22% to $294 million, or roughly $1.2 billion annualized. ANI per diluted share increased 25% to $3.52. Organic revenue growth was 17%, driven by continued strong sales, solid retention levels, and same-store sales recovery. Looking at organic growth across product categories, corporate payments was up 22% in the third quarter, highlighted by full AP, which grew over 50% again this quarter. Corpay One, our small business-focused full AP offering, grew 78%. Our full AP solutions continue to sell well in the market. Cross-border revenue was up 19%, which showed some softness from the lockdowns down under in Australia. We do believe much of this softness is recoverable, but the timing is hard to predict. The AFEX integration is progressing quite well. We've converted more than half of its customers onto our existing cross-border payment systems. We expect to convert the remaining customers before year-end. I'd like to thank our cross-border team as they've worked tirelessly to complete these customer migrations seamlessly while simultaneously operating a growing, thriving business. Within B2B, a lot of attention has been paid to new small entrants, several of which we enable with our partner program using our best-in-class virtual card. The partners we enable own the customer relationship, do the marketing, and take the credit risk, so they keep most of the economics. We're more of a processor to them, so our take rate is meaningfully lower than when we go direct to customers, which is really where we tend to focus most of our sales and marketing efforts. While these partners drive some volume growth, they still only represent about 13% of our corporate payments revenue. Fuel was up organically 13% year-over-year, with strong retention trends and record digital sales continuing to drive the performance. We're seeing some softness in same-store sales as Australia, New Zealand, and parts of continental Europe are still grappling with COVID-related lockdowns, and over-the-road trucking is facing the driver supply shortage that's been all over the news. Despite these headwinds, our fuel businesses continued to grow in every geography as a result of our sales efforts and strong retention rates. Tolls was up 14% compared with last year and showed impressive performance again this quarter, growing to above 6 million total tag holders with 5 million consumer tags and 1 million business tags. Now just for context, the business had approximately 4.5 million total tag holders when we acquired it back in 2016. Economic and business activity has returned to relatively normal levels in Brazil, which has increased customer mobility and sales traffic through retail and toll locations, helping us to achieve record Q3 sales. Lodging was particularly strong, up 40%, with airline lodging up 61% on the back of the recovery in domestic air travel. We hope to see more recovery in international airline lodging as borders reopen. Gift organic growth was 25% year over year, benefiting from continued retailer embrace of the online sales channel. Now looking further down the income statement, operating expenses were up 30% to $417 million and were 55% of revenue, stable with last year. The increase was primarily due to higher levels of business activity, the effect of currency translation impact on international expenses and acquisitions. Interest expense decreased 7% to $29 million, primarily due to higher interest income earned on cash balances and lower LIBOR rates, more than offsetting higher debt and securitization balances. As Ron mentioned, our effective tax rate for the third quarter was higher than expected, coming in at 24.1%. This was due to fewer stock option exercises during the quarter, likely due to the low share price, which resulted in minimal excess tax benefits. We currently expect our tax rate in Q4 to be back within our full year guidance range. Now turning to the balance sheet. We ended the quarter with $1.3 billion of unrestricted cash, and we also had approximately $650 million of undrawn availability on our revolver. In total, we had $4.6 billion outstanding on our credit facilities and $1.1 billion borrowed on our securitization facility. As of September 30, our leverage ratio was 2.76 times trailing 12 month adjusted EBITDA, as calculated in accordance with our credit agreement. We used $406 million to repurchase approximately 1.6 million shares during the quarter at an average price of $260 per share. We still have $1.18 billion of share buyback capacity in our program. Far this year, we've bought back 3.1 million shares and we've closed 3 deals, putting $1.7 billion of capital to work. On top of that, we still have low leverage and ample liquidity for additional deals and or buybacks, clearly demonstrating the earnings power and attractiveness of our high margin, high cash flow business. Looking ahead, I would note that you can see our full updated guidance and assumptions in both our press release and supplement. before we open it up for questions, I would like to inform you that at the most recent board meeting, FleetCor adopted the Rooney Rule for all future board positions. I would also like to mention that we expect to publish our latest ESG report to our investor relations website within the next few weeks, and we'd be happy to take your feedback on our ESG efforts after you've had a chance to review that report. With that said, operator, we'll open it up for questions. 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 tone will indicate that your line is in the question queue. You may 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 handset before pressing the star keys. We ask that you please limit to 1 question and a short follow-up. One moment please while we poll for questions. Our first question comes from the line of Darrin Peller with Wolfe Research. You may proceed with your question. Thanks, guys. Look, it's great to see the macro recovery and you guys benefiting there as well as the initiatives you've made, especially on the Corpay side. I just want to hone in on that segment for a minute, given all the acquisitions and the rebranding and the efforts on sales focused on really software now. Can you just touch on that in terms of what the different assets are going to contribute, where you saw the opportunity for growth most profound in the next few quarters? Then maybe just quickly, I saw in the quarter that we're hoping for a little more acceleration now, but I think some of this may just be coming over time as the sales force renavigates its focus. Can you just touch on the current trends? I think it decelerated on a two-year stack a little bit, but what it could be going forward. Thanks. Darrin, hey, it's Ron. Yeah, we're pretty happy with it. I'd say, you know, the sales continue to remain, you know, quite good in the corporate pay segment. Of the 3 areas, our direct business where we go to end clients and our FX business, cross-border business, super good growth in Q3. I think the direct business was 30%. I think it's in the earnings supplement. The cross-border, I think high teens, 19%. All the while we're digesting, you know, that AFEX acquisition, we're pretty busy on that. Right. I think, you know, those 2 pieces are basically 90% of the business, and they're growing good. The sales are good. To your point, if we get any COVID recovery, there's still some fair amount to get back next year. You know, we're bullish. I think our early view, again, is high teens for that segment for 2022. Okay. That's really helpful. I mean, just Ron, should we think about it being much more of a software-focused approach going forward in terms of sales versus, you know, more pure play virtual card? I guess more rolling together all the assets? Yeah, that's a great question. Yes, we started that. I think, you know, a couple years ago we bought kind of the full AP software front end and plugged it into our back end, you know, execution stuff. We've moved the mix, Darrin, dramatically here in 2021. We're selling, I don't know, I think almost $2, what we call full AP, where we take 100% of the client's payables, you know, versus virtual card. Obviously, the great news is it's still all virtual card, right? When we sell that full AP, underneath that basically is the same engine, to your point, the same merchant database, the same, you know, ability to earn interchange, if you will, on that portion. It sells better, we think. It has more value to the client. We generally retain more of the economics there, and yet we still, you know, have a bunch of virtual cards. So you'll see more of that. I think we'll probably move you in more of the business as you roll forward, that way. Got it. Yeah, that's an area of big. Thanks, guys. Our next question comes from the line of Andrew W. Jeffrey with Truist Securities. You may proceed with your question. Hi, good afternoon. Appreciate you taking the time. Ron, the commentary on the digital go-to-market, I think, is particularly intriguing. Can you talk a little bit about what the LTV to CAC looks like in your fuel business? I think you said 50% of sales are going through digital channels, and how we might expect that to inform your consolidated profitability over time. Yeah. I think the call-out, Andrew, was for our whole global, our entire sales for Q3. We run around 65%. Okay. Okay? Some businesses are better than that. Obviously, some are worse. The same with channels. I was referencing that the digital channel, which is growing as a percent, is lower than that 65% line average. The good news is, as the mix of our total sales moves more and more to digital, that should improve basically our cost of acquisition. Obviously, we're delighted that more and more of the business is moving there. Second thing I'd say about that is things that are less dependent on people, right? Hiring, training, and retaining lots of people slows company's ability, right, to staff and grow that way. On the digital side, we're getting pretty good at increasing digital advertising spend now and seeing the payback in terms of visitors and flow through to conversions. That's something we think we can step on a bit faster, you know, and get returns faster. I'd say this whole, you know, shift basically to digital sets up, you know, super well. As it relates to the corporate pay economics long term, I think you're right. I mean, I think the big idea we have is we've got this giant fuel card client base, I don't know, 500,000, I think, or more active clients, and they generally are small, right? We get, you know, a couple thousand, you know, in revenues. We don't get a lot from them. The idea of being able to go to that group and cross-sell them something else that has the same or more value obviously could accelerate revenue growth, but to your point, it's a way lower cost of acquisition than prospecting for new business, right? Going back to all the UIs and all the ways that we talk to our existing clients. Now when I say it's super early, we just started, but that would have an opportunity, one, to make our fuel card business and the synergy, the assets of 20 years of building that, you know, pay out, and then second, drive again the cost of acquisition down if that cross-sell component becomes big. Okay. Andrew, I'd just like to clarify. This is Charles. I'd just like to clarify Ron's comment regarding 65% in terms of an acquisition cost. We define that as what we call NSE or net sales expense. It's basically cost of acquisition divided by the annual revenue from that client or prospect. If someone's gonna generate 1,000 in revenue for me annually, it costs me $650 to acquire that account, that's the 65% metric that we use. Okay. How does that compare to the traditional sales channels? Yeah, I'd say that we've been fairly stable through time. Some of it does shift as you have more field-based selling. But in the main, we've been around 50, 60% for years. Yeah, Andrew, I love putting a spotlight on it because lots of other people, you know, spend lots of money. They generate some sales, but you can't ever make a return, right? So if you sold $100 million and spent $65 million, you're underwater the first year. But then you've got, call it $90 million of the $100 million you sold the second year with, you know, 80% flow through, you get $80 million flowing through for 8 more years with no sales expense. So that's the key to profitability in our kind of business is basically this acquisition cost and the retention rate. So we call it out because that's how the business actually makes money. Right. Okay. Very helpful. Yeah, I think that's an important metric. Thanks. I'll get back in the queue. Our next question comes from the line of Peter Christiansen with Citigroup. You may proceed with your question. Thank you. Good evening, guys. Nice results. Just wanted to dig a little bit into the lodging business this quarter. I know, you know, there was a bunch of natural disasters in the last couple of months, wildfires, Ida, so on and so forth. Just wondering, you know, to what degree that was a contributing factor to some of the outsized growth in lodging. How should we think about the ALE Solutions business, you know, during periods of natural disasters? You know, how does that business, I guess, from a revenue perspective, how should we think about it operating in these types of periods? Thank you. Hey, Peter. Thanks for the question. It's Ron. In the first part of the question, hey, how did bad weather, you know, and stuff help the lodging business in Q3? Some is the answer. We pick up some decent amount of incremental volume when that happens, kind of almost unexpected volume, but the rate on that is like super-duper low. We're signed up, you know, with contracts with people like FEMA and stuff. Lots of volume and a little bit of revenue contribution. On the ALE Solutions side, I'd say it helps again a little bit. The diligence that we did on that business is surprisingly over incredibly long cycle. I don't know, 90% plus, I guess, over the 5 or 10 years we looked at is not, you know, hurricane or natural disaster related. It's your pipe breaks and your house floods, and you left the candle on in the bathroom and the house burned down. It's it's what we think of as just way more common, you know, kind of every day, which is why we went ahead with the business. It's just way more ratable. You take, you know, all the hundreds of millions of homes or apartments, stuff goes wrong with them that displaces people. You know, that business, obviously it's insurance, so the statistics on it are pretty good. I'd say for both businesses, it helps really just at the margin. That's helpful. Then your comments on the fuel card business, seeing, you know, a little bit of incremental softness, which is understandable what's going on abroad in some areas. I was just wondering if you could characterize the competitive market perhaps for larger fleet type deals and how that's kind of evolving, I guess, as we come out of COVID. Are you seeing competition intensify or are there big opportunities ahead, do you think? Just wondering if you'd put a frame on that. Thank you. I'd say probably if anything, it's lessened during COVID. I mean, I think we've called out for at least a few quarters now the overall fuel card retention rate, which is up. I think it's up. I don't have it in front of me, but it's certainly up dramatically in the last couple of years versus where it was, you know, a couple of years ago. I think I called out that it remained at 93% for the quarter. I would say, you know, that COVID basically, you know, people shifted to other priorities and doing RFPs for fuel cards probably wasn't, you know, the top one. The other thing I'd say, because I think it's misunderstood, is the real competition for us. We study wins and losses in fuel cards. Where do we get the 35,000 new accounts that came on board this quarter, and where are the 10,000 that we lost? The answer, you know, is not our friends WEX. It's basically business cards and other forms of payment, mostly business cards, for example. That's the real competition for us globally in the fuel card business is really other means of payment. That's great. Thanks. Yep. Welcome. Our next question comes from the line of Ramsey El-Assal with Barclays. You may proceed with your question. Hi, gentlemen. Thank you for taking my question tonight. I wanted to ask about the new sales bookings growth, which was an impressive number. Was this the result of any kind of changes you've made in your approach in terms of the sales organization? Also could you help us think through or maybe even remind us of the algorithm by which those bookings will eventually convert to revenue, maybe something about timing or how that actually operates? Yeah, yeah, Ramsey. We agree. I tried to put a bit of a spotlight on it for the quarter because it's in record territory, right? You know, there weren't 50,000 accounts when I started with the platform, you know, 20 years ago. To sign up 50,000 new businesses in a quarter is good. Second, against the 2019 baseline, I think I called out our bookings dollars were up 30%. Forget the weak comp against a normal quarter a couple years ago, it's way up. The headline is, our company sales are way up. That's headline one. Part B is, why are they way up? I think it's the rotation we made into digital. Start, I don't know, 4 or 5 years ago, we did a bunch of things to get way better at digital marketing and selling obviously, not the least of which is the whole tech stack that we built to be able to follow businesses and everywhere they crawl around and then what they do to advertising, figuring out where to spend and who to target money against to get them to visit our sites, to optimizing our sites to get conversion rates and sales, you know, out the bottom end to applications going end-to-end, where someone could go on our site and literally order the program and get cards in a couple of days and not have to talk to people. The re-engineering, I'd say, of the whole digital machinery has been, first of all, it was massive, but we're getting the returns of it now. It's obviously ramped way the heck up, and I think it's another huge step up in our early plans for 2022. I would say that's the main driver, and we're doing that everywhere. We're just way smarter in how we target and how we study where prospects go and what they're looking at, instead of trying to make up who we think might be interested in our products. On your second question on bookings, the answer to it is, let's say we said, "Hey, we've sold," you know, pick a number, "$100 million of new business in this quarter." To Chuck's point, what that means is as you roll forward and that all gets implemented, it's obviously an annualized amount of $100. It wouldn't be $100 in this year like we sold it throughout the year. It'd be $50, for example, in that case. We have very different timings. You know, in our Brazil business, we sell and it's almost programmatic. In our fuel card business, we sell and we get it, you know, pretty soon. In our corporate payments business, which are bigger accounts, it takes longer. So our We basically know our sales, if you will, our new business for 2022, 'cause it's all sitting in our pipeline to be implemented. The bookings number turns into an annualized revenue number, which is how we build our plans, and then the timing of what we call the in-year amount varies across the various businesses we have. The main thing I wanna make sure people are clear is it's working. I don't wanna get lost in the details here that the company, our company, is selling more of everything than it's ever sold before, ever. Great. Sounds like it's not a fluke, but by design. That's encouraging. Ron, I wanted to ask you about your new compensation contract, which is structured in more of a pay-for-performance kind of style. Can you talk about why you pivoted in that direction in terms of structuring your comp and sort of what gives you confidence about hitting those sort of future hurdle rates? Yeah, that's an interesting question. I say, you know, basically that, you know, the first 10 years of the company's life was in a PE form, where the alignment between investors and managers were super clear. If value gets created, you know, the proceeds get split versus this kind of, "Hey, I just gave you money for showing up." It's in kind of the DNA. I like it. I like if the people that put capital in alongside of me get returns and I get returns, and if we don't, we don't. Obviously there's more leverage in that. I've got, as you know, a lot of money, and so, you know, getting some money with our current tax structure is not super interesting. It's a motivating way to keep me at the grindstone for a couple of years here to try to get the thing to the, to a place. How do I feel about the confidence other than the way people trade our stock? I feel good. We have models, you know, that come off of this sales retention math that we run all the time, 3 year models, and I see what the revenue and cash EPS looks like running through our machine. If it's valued fairly reasonably, it gets to those targets that are there. I look at it and go, you know, if someone priced our earnings reasonably, I think we can make the targets, and then I can get paid. That's very helpful, Ron. Thanks so much. Our next question comes from the line of Mihir Bhatia with Bank of America. You may proceed with your question. Good afternoon, and thank you for taking my question. Maybe just to start, I just wanted to ask about the gift card business. You know, given all we're hearing about supply chain issues, could that be a tailwind, you know, in 4Q, maybe a little bit of a unique opportunity there? Anything you're hearing, if you could just talk about that. Yeah, Mihir, it's Ron again. Yeah, there are a bit, you know, on the card side and just the retailers ordering cycle. I would say it looks, you know, kinda like it's gonna come in on our plan. Let's just talk into our gift head. I'd say the upside for us is probably not so much that the corridors would go up. It's really, you know, the guy running it, and we finally found a way to grow the business. I don't know how long you've followed our company, but I've been trying to sell the business since I bought it. All of a sudden, the guy has turned it into a business now that we think that can compound a double digit. The way they've done it is, instead of just being an administrator and accountant, you know, for the Macy's, you know, gift card and count the $100 down, they help our clients now sell online. They've moved over to helping sell online digital gift cards because they know a lot about it. They're getting paid extra for wallet provisioning. You know, half the gift cards, there's breakage, where people can't find them anymore, they're in a drawer. Super technically hard to move private label cards into wallets, but our guys came up with a way to do it, so we're getting paid money from a number of the brands to basically provision those electronically. Then the guy came up with the idea of selling the content. We have, I don't know, 300 or 400 pretty good brands. We're still taking them back to businesses because we're in the B2B business, so they built a bit of a revenue and sales stream now, taking them for rewards to like companies like ours, for example, for employees. These 2 or 3 new ideas on top of the kind of old chugging along, kind of low single digit business has propped that thing up now to being, you know, north of 10%. I went through the guy's plan a couple of weeks ago. I think we finally have a set of ideas that are more sustainable to keep growing that business now. All right, great. If I could ask about just about Brazil. You mentioned, you know, things are getting back to normal there. You've obviously had very good momentum in selling more tags. Is there an argument there that, you know, you might see a little bit of exponential step function growth in the revenues per tag? Because those are still meaningfully below, like, where you were in 2019, and, you know, you've obviously added a lot of capabilities where you can use those tags too. Yeah, that must be. You're looking, I think, at the FX. So we're way the heck up. The sales there in constant currency, you know, in real are way up. I don't have it in front of me versus 2019. Chuck's gonna pull it up, but these would be record levels. Whatever we sold in Q3 would have been an all-time record number of sales. What I said about the recovery is, you know, Brazil was in a complete ditch, COVID-wise, you know, in the spring and into the summer. It somehow has come out the other side. They're in a better place than we are here. What that's done is it's opened the stores there where we sell a lot. We have kiosks in hundreds and hundreds of stores. Stores are open, people are walking. Mobility's back, more people are running through the tolls where we also sell. The places basically where we conduct business to try to make sales are kind of reactivated again, which is helping drive it. Then second, I think we said before, we've come up with a number of super new partner or channel ideas there. The newest one is we've got a couple of the big car manufacturers to put the tags now on the vehicles. When you go in and get your new Volkswagen and drive it out of the dealership there, you look up and there's a sticker already there with a little, you know, POS thing that says, "Hey, call this number or go to this website." We're getting, like, 50% or something conversion on adoption of these new vehicles rolling out of the dealership. It's really. I can't even tell you how good of a sales story that team has put together. The... As you said, the big, big idea for us, and we poured a lot of capital into it this year in 2021, is to double or triple the fueling locations, and the fueling transactions are up huge over a year ago now as we take the 6 million vehicles that we had tags in and give them more places to use the tags. That's the one. If you said to me, you know, where could the free money, and real acceleration come? It could come from this massive group of people basically just having, you know, more places to use the tag in the account that's already on their vehicle. Right. You get paid per transaction, right? Thank you. We get paid MDR, pretty attractive MDR on the fueling in that example, yes. Perfect. Thank you. Our next question comes from the line of Sanjay Sakhrani with KBW. You may proceed with your question. Thanks. I wanted to talk about the partner channel corporate payments mix that Charles touched on. When we think about that 13%-14%, is it a higher profitability contribution because, you know, your partners are sort of bearing the expense? As we think about, you know, how that percentage is gonna migrate over time, do you expect that to go up or down or, you know, is there? How long are those partners committed to? Thanks. Yeah. Let's run. Let me start with the second part. We probably have, I don't know, 15 significant kinds of partners in that corporate payments group: top 3 or 4 most important, another 8 or 10. The contracts generally would run anywhere from probably 3 to 5 years. We just renewed actually a couple of them with some of our most important partners this year. In terms of what do I think, I'd say down would be my answer. If you look at, I think we put, Jim, a slide in the earnings supplement. I think it's Page 15. Yeah. -Sanjay. Okay. That's positive. Yeah, you're right. It takes the 3 pieces of our corporate payments business, the partner thing that we're talking about, and then the direct business where we go to the end client, and then the cross-border business where we mostly go to the end client. You can see that those two are growing revenue much faster. The mix itself, if you just ran the clock forward, would make the partner piece smaller, I think, you know, going forward. Obviously there's lots of spend there and spend grows fast. To your point, they do more of the work, so obviously our rates are much lower there than in the direct business. We like the business, but obviously 90% of our corporate payments business is, you know, in the direct and cross-border. Okay. I guess obviously the chatter out there is just, you know, you have a lot of these fintechs that are competing against you and with you, and I'm just curious as we think about FleetCor's competitive edge. I know, Ron, you talked about how you're putting the acquisitions together to deliver a powerful punch. I mean, do you feel like the competitive intensity has increased in that market and you're or that you've widened your moat in that market? I'm just curious to just get a little bit more color on that because that's obviously been a hot topic of discussion. Yeah. I think it's a super good question. I think obviously there's more people trying to get into, you know, card processing, whether it's virtual or just traditional physical cards. I think first off, that a lot of the players that get into it are more of an issue for issuing kinds of companies that are in that business, right, for FIs than for us. But yeah, some of them are coming into our area. What I'd say back is the fallacy is somehow that the game is tech and product. That, oh, the XYZ fintech has some great thing, knock old-fashioned FleetCor out of it. So what I'd say to you is, what they're missing is, it's the merchant network. You know, you can't monetize virtual cards if you don't have a virtual card merchant network that can process and capture those transactions. You can profit till the day goes on, but you have to have the network. We've had a, call it, I don't know, a 10-year head start on everybody in cleansing, building, growing that network. Then the second one is the whole service dimension of a huge pay-for-you group, a massive group that helps the partners, you know, clean up the data and get the stuff processed. I'd say those would be the couple of components that people miss that this isn't just making a new processing engine in the garage and giving it to AWS, and it's all gonna be great. There's actual real assets that we have that cause our partners to stay with us. I mean, there was a big thing. Someone came into my office, oh, I hear 2 of your clients, Bill.com and AvidXchange, have brought on other providers. We're doing great with them. We've renewed the contract for a number of years with one of them. We're getting more business than ever from another. We're obviously have a great relationship. Some of those are targeted, like the Marqeta thing, as an example, is targeted to FIs, which we're not even in. We're not in the processing business to help FIs. We thought they would use their own processors and stuff. I think like everything else, it's someone searching for some narrative that isn't there. We've got a good business. It's growing. The spend's growing like crazy. Because we make so much more money on the direct businesses and they're growing fast, that mix will cause the partner thing to be a bit smaller. I think we're still you know, I tell you, go call the partners. Don't ask me, the supplier. Go ask our partners if they like the job we're doing. I look at the performance reports. I sit in performance reviews with the partners myself personally. From my vantage point, we're doing quite well. Thank you. Thank you. Our next question comes from the line of Ken Suchoski with Autonomous. You may proceed with your question. Hi, good evening, everyone. Thanks, thanks for taking the question. I just wanted to dig into the fuel card business a little bit more. I mean, it looks like transactions came in weaker than we were expecting, and I think you called out international and the driver shortage. Can you provide some detail there on where you're seeing that weakness on the transaction side? And what's your expectation around the recovery? Yeah. Ken, hey, it's Ron. So yes, I'd say there's good news and bad news. The good news is. The bad news is A, the transactions are a little weaker than we thought. The good news is they're not worth much. So the two areas of weakness are in trucking again, and particularly large trucking, both here and in Europe. You guys have read the press on this, that the large trucking firms just don't have drivers. Not only are there not drivers, they're quitting and forming and going into smaller firms now. Our big accounts are effectively just soft in terms of trucks and transactions, but they're happy because they're just raising their rates. The second one I'd say is really Europe and the big corporates there with the white collar, you know, book of business where people haven't gone back to work in Europe. I don't know if you guys know this, but in Europe, lots of people have company cars. People like us, you know, have a car, and we used to drive around and get reimbursed. Those are the two areas that are weak. The good news is we don't get paid anything for those things, or we don't get paid very much. That's why our, you know, our revenue growth is still pretty good. The local business, for example, and our partner business are super healthy. Even a big part of our U.K. business, which I'm looking at, had strong same-store sales recovery. The areas where we get paid and we get revenue are actually pretty healthy. Got it. That's really helpful. For my follow-up, I think on last quarter's call, you provided some preliminary thoughts on 2022. I think you talked about $14 in annualized EPS in the second half of this year. You have some interest rate hedges rolling off and then the contribution from AFEX and ALE. Lots of moving parts. Maybe you can frame for us how you're thinking about 2022. Yeah, that's a good question. I mean, I say this all the time. If you like businesses you can plan, you should like our business. It's the nature of the model. What we do is, which we're about halfway through, we build things off of run rate. We're staring here at October volumes and revenues in all of our businesses. I think what I said is, "Hey, when you post $352 million or $350 million, we multiply it and we go, 'Okay, that sounds like $1.4 billion.' We guide it to a number." I don't have it in front of me, Chuck, that's $350-something million for Q4 because of track stuff. There's another one. We start with the company running, earning $14 on an annualized basis now. We sit there and say, "Okay, we have sales record levels this year, of which, call it two-thirds of that will be realized in 2022, so we can see what that number is." We have a bigger sales plan for 2022, probably 20% higher, and we look at what's in there. I'm like, "Okay, that looks good." We look at the deals that I mentioned that are kind of on top of that, which I think I called out together, call it $0.50 would be, you know, kind of my commitment on the stuff that we use capital for. That's how we build the math. We take the run rate, we take this year, next year sales, we take added things like the accretion of deals, and that helps us basically target a number that we can get to. We haven't planned a heck of a lot of COVID recovery. Obviously, it's been the weirdest, you know, obviously 12 months this year. We've been pretty conservative so far. You know, getting some of that back, we still have probably $150 million that could literally come back a different day, potentially. Those are the components. What I was trying to say, and the other one is the macro. Obviously, fuel prices are higher here in November than they were, you know, in January and seem to be holding. When you roll all that up, my message is it looks super early, but it looks like a you know a really good number. The reason I go through all that math is to give people other than us who are in the company some insight into how they ought to think about it. That things could happen, but that the company is pretty well positioned to put up you know an attractive growth number for next year. Okay, great. Thanks a lot, Ron. Appreciate the detail. Our next question comes from the line of David Togut with Evercore ISI. You may proceed with your question. Thank you. In the corporate payments business, WEX reported a pretty substantial compression in revenue yield in the third quarter year-over-year. Can you comment on the revenue yield you're seeing in that business? And you know, A, is there any significant change? And are there any call-outs in verticals, i.e., kind of travel versus non-travel? Hey, David, it's Ron. It's a good question. I'd go back to the slide that Jim put in our earnings supplement. I think it's Page 15. Again, sitting inside our corporate payments business, I think we reported, what, 22% organic growth and, what, 50% or something prints for the quarter. 58, I think. 58. Obviously that's the overall number, David. The pieces of that, again, are the direct or end client business, the cross-border business, and then this channel partner business. For us, the good news is the two big pieces, which are about 90% of looking at the thing, are effectively flat. Because we price it, there's really no rate erosion in that part of our business. All of the rate erosion is really just in the mix of partners where we have, you know, tapered rates, and we have some partners that are growing like crazy. As their volumes go up, they enjoy a bit better rates, right, than the base rates. Because we don't have the same kind of reliance, if you will, on the channel business, I think we're a bit more insulated, if you will, from rate compression there. I mentioned it earlier, I'd say the super positive thing is our mix of that business is going to more full AP. Don't forget, you know, we bought a SMB company that has higher rates. As we roll in the full AP, the invoice pay mix, and this Corpay One mix, those have a way higher rate than the existing businesses. My guess is just kicking out the channel business, I see actually rate expansion over the next couple of years in that business, mostly help from mix. Understood. That's very clear. Just as a quick follow-up, you commented earlier about the difficulty of finding drivers in this environment. Could you quantify for us what this means for your, you know, fuel card business in terms of revenue growth in 2022? Yeah, again, I think the driver thing is a total, you know, trucking vertical issue, David. We don't see it, obviously, as significantly in the trades businesses, right? Plumbing, you know, those people have to be trained in whatever they are. We don't see the same kind of softness, if you will, of our existing customers in those kinds of businesses. Again, we see it mostly in the large account trucking business, would be the other thing which we don't make any money in either. I'd say that, you know, who knows? My guess is it's not a super easy fix for suddenly large trucking people to get the people, although you see the pictures at the ports of the need for more trucking. My guess is there'll be more incentives and pressure to try to get more people into the space over the next 6 or 12 months. I'd say it doesn't do much to us. One, it's limited only to that trucking vertical. Two, it's limited to the big firms which don't pay us much. And 3, honestly, it's kind of in our run rate. The softness has really been there for the last couple of quarters. I don't see it really getting any worse, mostly 'cause of what I said, that I think there's gonna be such a push to try to add people, and I think the rates, you know, are gonna keep going up to attract people. I'd say it's probably not a super-duper impact on our forward thinking for the fuel card business. Understood. Thank you very much. Yeah, always good to talk to you. Our next question comes from the line of George Mihalos with Cowen. You may proceed with your question. Hey, guys. Thanks for taking my questions and for squeezing me in here. Ron, you talked a lot about some of the, I guess, hiring and, you know, wage pressures that are impacting the fuel side of the business. I'm just curious, as it relates to the corporate payments business, do you feel that that's been impacted at all by any supply chain issues at your customers, or has that come up at all in your conversations with them? Yeah, for sure. I mean, again, you know, George, I'd say it's pocketed. You know, when we go look, we have bigger customers there. And so, you know, some have come through this thing, you know, kind of unscathed, and then others have had big problems. So yes, we have a select group of clients that are kind of down and have stayed down, and I think the supply chain is a big part of it. Okay, that's helpful. I'm just curious to the extent are you able to quantify that in any sort of capacity or give any sort of color around that? Then maybe separately for a follow-up, the minimal credit losses that you're continuing to see, is that just a harbinger of just you know cleaner credit now? Or do you feel that there is an opportunity to you know loosen credit standards even from here? Just curious how you're thinking about that. Yeah. Let me take the first part. Yes, we are. One of the easiest things to quantify for us is to look at clients we have, let's say clients 1 through 100, and look at their volumes and revenue in a prior period, let's say 2019 or Q3 2019. Then let's say we still have those 100 clients to go look at their volume and revenue with us in Q3 of this year. That's the stat we call same store sales or the core client base. Yes, we for corporate payments for every business, we turn that into a revenue number and say, okay, you know, we're soft, whatever, $20 million with clients that used to give us $20 million more 2 quarters ago than they do now. Hey, we watch them to see whether some of that $20 million is coming back. We have super clear visibility on the amount of it and the rate of recovery of it. Is that one clear? Yes. Just curious if you could sort of ballpark what that impact would be, or if you're willing to ballpark what that impact would have been, how much faster the growth would have been in the segment. You wanna say anything about that? Yeah, I think if we look at those pocketed groups, so in corporate payments, the top 75, we last looked at it last month. The 75 most affected clients, their volume was still down about half of where it was back in January 2020. We looked at it just last month. We continue to track it. As Ron mentioned, it's highly pocketed in certain categories that just haven't quite reopened yet. It's about, just to give you a percentage, it's about, I'd say 3%, you know, this quarter versus our plan. Hey, we guesstimated those 100 people would come back a certain way in Q3 from 2 years ago, and they came part of the way back. If they come back to where we thought, we'd get 3 points more of growth in the thing. It's still a significant thing and, you know, we'd be hopeful maybe we get it back. It'd be kind of great if you get back a different day. On your second question, the credit question, you know, I say yes, and yes. It's a super good question. It's record lifetime lows of credit losses, first of all, because we didn't sell much new business obviously in 2020, so there wasn't a lot of new business coming on. Between the stimulus and relief and everything else, you know, people repaid us and stuff. For sure, we've opened it up. I think Chuck said in the last call last time that we expect those losses to tick up. You can see it a bit in the roll rates, right? As we've onboarded a lot more business this year, our Q4 losses will be a bit higher. We're actually doing that juggling question now for 2022 of, okay, you know, how much do we, you know, how open do we wanna be in credit, both with existing accounts in terms of credit lines? I mean, think of this. I've got 500,000 fuel card clients that have some credit line, and the credit line's enough to pay their fuel card bills. What if they tell me they wanna pay all their bills with me? And I said, "Okay, I'll let you pay some with our credit." I mean, our opportunity to increase credit to creditworthy people for our new products is, like, super high. So I'd say we for sure will rebalance next year towards taking more risks certainly than this year and try to make that trade-off, right, between incremental sales and revenue growth and incremental losses. But we'll be careful. I wanna make sure everyone on the call is clear. We're not crazy. We'll step our way in. We'll study our way in, but we will do more of it. Very helpful. Thank you. Our next question comes from the line of Bob Napoli with William Blair. You may proceed with your question. Thank you. Good afternoon, Ron and Jim and Chuck. Ron, I mean, there's been a lot of questions asked and, but just, what business or what are you most excited about over the next few years? Which parts of your business do you see the most opportunity to maybe outperform, you know, drive upside, drive growth? Yeah. Hey, Bob. It's a great question. I'd say to me, the most exciting thing, which is, you know, coming mostly from the world out there, is this synergy, this platform concept of bringing walk-around plastic, which is the business we've mostly been in, with payables together. It's a way of creating, you know, in our case, a massive synergy of these businesses we built over 20 years of getting just way more out of them. You know, I gave the example earlier. We're launching, you know, late this month or the beginning of December this thing we call the 2-in-1, where a client that has a business card of ours or a fuel card could also, you know, pay bills with us and literally would just be in one place. He could use our card and our credit to pay some of his bills. Obviously, we'd have access into his bank account to fund the bills. His report would show all his walk-around purchases like it does now, and it would show all of his payables, the vendors, the way it is now, and it would all be in one place. That has the opportunity of joining up, you know, businesses that we have. That's what creates profit acceleration, right? Where you don't have to go fish one at a time, right? For each new client, you can go back to this, you know, pretty gigantic customer base that we built and basically start to join it up and cross-sell stuff that's useful to them. The tech that we have now makes it look. When you look at it's just stitched together now. I'd say that that's. Again, I try to say in the thing, I'm also excited. I know people doubt me, doubt us, but you know, we got a lot of legs in the businesses we have on that page. You know, we pitched this Beyond thing, and we've added segments everywhere in all the businesses which are adding growth. I'm you know, obviously super happy about that. This integration and joining up in synergy, where the new guys that have some nice, new, shiny product, they don't have a 20-year customer base and spend and you know, they don't get 50,000. Send me the notes of all your guys that signed up 50,000 clients in the quarter. That's the super exciting thing is can we monetize this bigger business profitably. Would be what I'd say is the super new, you know, opportunity for us. Great. Thank you. Charles, just how are you feeling, you know, looking at margins, the ability to expand margins from here over the next few years? Yeah, Bob, I'd say that, you know, our model tends to be one where we try to grow top line, you know, 10%+ and get a little bit of expansion. I think, you know, that is a mindset we've had for a long time, and we'll continue on that path. I'd say we'll increment our way kind of as we go. With that said, we do make a little room for select investments, whether it's the digital sales that Ron mentioned. When we find opportunities to invest, we will make those investments, but always with a mindset that we'll continue to grow the bottom line a little bit faster than the top. Great. Thanks. Appreciate it. See you, Bob. Yeah. At this time, we have reached the end of our allotted time for the call. Thank you everybody for joining today's conference. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation, and have a great day.