Good day, and welcome to the FLEETCOR Technologies First Quarter 2023 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Jim Egleseder, Head of Investor Relations. Please go ahead. Good afternoon, everyone, and thank you for joining us today for our first quarter 2023 earnings call. With me today are Ron Clarke, our Chairman and CEO, Tom Panther, our new CFO, and Alissa Vickery, our Chief Accounting Officer. Following their prepared comments, the operator will announce that the queue will open for the Q&A session. It is only then that you can get in line for questions. Please note that our earnings release and supplement can be found under the Investor Relations section of our website at fleetcor.com. Throughout this call, we will be covering organic growth. As a reminder, this metric neutralizes for the impact of the year-over-year changes in foreign exchange rates, fuel prices, and fuel spreads. It also includes pro forma results for acquisitions closed during the two years being compared. We will also be covering non-GAAP financial metrics, including revenues, net income, and net income per diluted share, all on an adjusted basis. These measures are not calculated in accordance with GAAP and may be calculated differently than other companies. Reconciliations of the historical non-GAAP to the most directly comparable GAAP information can be found in today's press release and on our website. I also 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, and all statements about our outlook, new products, 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 undertake no obligation to update any of these statements. These expected results are also 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 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. Hi, everyone, and thanks for joining our Q1 2023 earnings call. Also joining us here today is Tom Panther, our new CFO, who is now official, so delighted to have Tom here with us. Up front here, I'll plan to cover four subjects. First, provide my take on Q1 results. Second, I'll share our updated full year 2023 guidance. Third, discuss progress on our value creation and simplification plan. Last, lastly, I'll comment briefly on our newly formed strategic review committee. Okay, let me turn to our Q1 results. We reported revenue of $901 million, up 14% and cash EPS of $3.80, that's up 4%. Both results finished above the top of our guidance range. The cash EPS of $3.80 clearly weighed down predominantly by higher interest expense. At constant interest expense for the quarter, cash EPS would have been $4.30, up 17%. Our model's intact. The macro environment did cooperate, basically coming in as we anticipated. EBITDA for Q1 exceeded $460 million, up 17%. Margins there up 100 basis points year-over-year. We invested incrementally about another 100 basis points of margin in a set of capability acquisitions from 2022, those intended to better position the company for the midterm. Trends in the quarter, quite good. Organic revenue growth Q1 was up 12% overall. That accelerated sequentially and is above our 9%-11% target range. Same store sales finished +3%. Healthy. Retention finished at 91%, slightly impacted by the credit actions we took in Q4 to contain credit risk in the micro segment. That does drive a bit of involuntary attrition. Sales performance, absolutely terrific in the quarter. Up 31%, setting new record levels of new bookings. Look, fundamentals in a good spot. I do wanna highlight our Brazil performance in Q1. That business really doing a nice job of transforming from a toll centric business initially to now a broader vehicle payments business, again for both businesses and consumers. The vehicle related payments now include not only tolls, but fuel, parking, fast food, and recently now even vehicle insurance. Another super good sales quarter for Brazil, new toll tags, record level, and those were helped by a new bank relationship with Santander, which added almost 15% to the overall sales in the quarter. We also had terrific fuel transaction growth, up 39%, as we continue to increase the fueling acceptance sites. Most surprisingly in the quarter is of our approximately 5 million active consumer users there, 3 million utilized our new Sem Parar app, mobile app in the quarter, and that engagement helped drive almost a 15% attach rate of insurance policy add-on sales. Consumers coming to the app, looking around, seeing offers, and actually transacting with us. We think this engagement opens up, you know, big time cross-sell opportunities. Look, all in all, a very good start here to Q1. Sales, revenues, profits, all of those above our expectations. Let me shift gears and turn to our updated full year 2023 guidance, along with assumptions behind it. We are revising full year revenue and cash EPS guidance up by our Q1 beat. Revenue at the midpoint now, $3.84 billion an d cash EPS at the midpoint now $17.15. We are expecting the rest of year environment to be pretty consistent with what we forecasted 90 days ago. A few puts and takes, but overall in the same place. We've got an early view of April trends and results, continuing to track to our plan. I do wanna point out that we're expecting rest of the year organic revenue growth in the 9%-11% range. Inside of that, fuel improving to kind of mid-single digits, Brazil and lodging in the mid-teens and corporate payments in the high teens. We're expecting rest of year earnings to accelerate. That'll be driven by these record levels of sales, flowing into the second half, stronger Q2 and Q3 seasonality. Again, a second half fuel acceleration, driven really by the pivot in sales in that business, from micro to a bit upmarket. We'll see better operating leverage as we run through the year. Revenues will expand faster than expenses. That should result in EBITDA margins in Q4 about 200-250 basis points better than last year. Second half EPS will also improve mostly as we lap the interest expense and higher bad debt levels than we experienced last year. Finally, we will keep a close eye out for any signs of macro weakness so that we can react quickly if we need to. Again, our solutions are generally pretty essential, pretty important, and demand for our services tends to actually run higher in inflationary times. Let me transition to the progress that we're making on our value creation or simplification plan. We're working across three areas there. First, to eliminate overhang related to the Russia and FTC case. We're working to reduce complexity and present a simpler company. Finally, EV, we're working to demonstrate that we can You know, basically succeed in this energy transition. First up, Russia. We have signed definitive documents now to sell our Russia business to a local firm. We're awaiting Russian government approval for the deal. If we can get through the various hoops here, we would expect to close at the end of the end of the quarter, the end of Q2. Tom Panther will provide some additional details on the impact of the transaction. Next up, the FTC case. Not much new to report here. As a reminder, both we and the FTC filed proposed orders back in February outlining some additional disclosure enhancements that we had been discussing with the court. Now it's really up to the court or, you know, to decide, you know, what the conclusions will be and what the order will be. Given again that these are disclosure-related subjects, we continue to believe the court order will not have a material impact on the go-forward financial performance of the company. Over to simplification. We are evaluating ways to simplify our company. Three things under consideration. First, we are actively exploring the divestiture now of a few non-core assets, that's underway. Second, we're considering moving to three reporting segments versus today's five. Lastly, we're continuing to evaluate a brand change for the entire company to Corpay, that would better reflect really the broad set of corporate payment solutions that we're offering. Expect to make decisions on these simplification ideas over the next 90 days. Let me make the turn to EV and reference pages 11, 12, and 13 in our earnings supplement. We've launched a pretty unique solution, EV solution in the UK. We call it our three-in-one solution. That solution provides our fleet clients with a single program, one program where they can make, you know, traditional diesel purchases, on-road public EV recharging and manage at-home EV recharging and reimbursement. Three-in-one. The early indications are that the EV economics could actually be favorable to us. We looked at a sample, 271 clients in the UK, that have been with us over the last eight quarters and examined the revenue pattern. What you can see in the supplement is that the EV revenue per vehicle is actually higher than our ICE revenue per vehicle. Although early days, pretty good news. The driver here is really the need for businesses to measure and reimburse recharging at potentially, in our case, 1 million homes, right? The number of users we have. It will be quite a task. I also wanna point out that we're continuing to pursue the consumer EV payment opportunity, so providing some potential upside to the EV energy transition. Since we are, you know, building, acquiring EV networks and EV technology for the B2B market, we've decided to repurpose those capabilities to serve consumers. Underway doing that in Europe, we're building a consumer EV payment business. We've signed 10 EV vehicle manufacturers, and we're serving their new EV consumer buyers. When a new EV consumer drives off the lot, they will be using our EV network and payment app. Out of the blocks there. Okay, let me make the turn to my last subject, which is our new strategic review committee formed to evaluate the portfolio options for the company. We did retain Goldman Sachs to support the assignment. They have shared their preliminary analysis and thoughts with both the committee and our board. I do want you to know we're taking this portfolio assessment quite seriously, and we're evaluating really all options to potentially increase shareholder value. I want you to know that I am personally aligned here with shareholders, both in terms of the importance of rerating our multiple, but also the urgency of doing so. Early days, but, you know, we're digging in, we're evaluating options, we're meeting folks, we're sizing dis-synergies, you know, we're getting at it. We do expect to have much more to report when we speak again in 90 days. Look, in closing, again Q1, out of the blocks in a good way, ahead of our expectations. Our rest of year guide up, assuming 9%-11% organic revenue growth, with improving margins and earnings. Working aggressively to close out our Russia and FTC overhangs, begin communicating, hopefully a simpler company, and advancing the EV capabilities. And lastly, as I just said, we are just underway, evaluating portfolio separation options. A lot going on. With that, let me turn the call over to Tom Panther, our new CFO, to provide some additional details on the quarter. Tom? Thanks, Ron. It's great to be formally on board and to have joined the FLEETCOR team at such an exciting time. The last several weeks have been a great opportunity for me to learn the business by spending in-depth time with our people to better understand our markets, products, sales strategies, key initiatives, technology, and much more. There is more for me to learn, but the team has been incredibly helpful accelerating my journey up the learning curve. I'm impressed by the exceptional talent and high caliber capabilities that support the organization. FLEETCOR has a proven track record of generating strong top-line growth and accretive operating leverage, and I can see why it's able to deliver those sustained high-quality results. I'm looking forward to digging in and helping the company achieve its business, strategic, and financial objectives. I'm confident in FLEETCOR's growth prospects, both organic and inorganic, moving forward. We need to look no farther than the first quarter results to understand why I'm confident in the company's future. As Ron mentioned, we posted 14% revenue growth in the quarter, including 12% organic growth. The incremental 2% of reported growth was due to acquisitions made last year, as the macro fuel and FX factors were mostly a push versus prior year. Revenue of $901 million exceeded our guidance by $19 million, which flowed through to our $0.15 beat in cash EPS of $3.80. Moving on to the segments. I wanna point out that we changed our organic growth solution disclosures to match the segment reporting that we implemented last year. Going forward, both reported and organic results will be disclosed in Fleet, Corporate Payments, Lodging, Brazil, and other. This will be cleaner and eliminate any confusion between segment and solution categories. We've provided organic growth information on this basis for the last eight quarters on slide seven of our earnings supplement, and we've provided a map in the appendix so you can track these classification changes. Now on to the quarter. Organic revenue growth was 12%, as we delivered results 2% above guidance, reflecting the strong diversification of our business and the realization of strong sales results from last year across all of our businesses. This is despite the intentional strategy to pivot our U.S. fleet sales upmarket to mitigate credit exposure. Our corporate payments revenue grew 19%, led by our direct Corpay payables business, which was up over 30%, driven by continuing strong sales, especially in full AP automation. Our solutions are selling well in the marketplace, and we continue to believe that we have attractive and differentiated offerings that will drive future growth over time. Cross-border revenue was up 21%, which is normalized for the Global Reach acquisition in January. The cross-border team had another very good quarter as new sales and customer wins remained strong, while also substantially completing the Global Reach integration, which is underscored by 90% of the Global Reach revenue already migrated to our platform. Fleet revenue increased 6% on a reported basis, driven by higher volume. Organically, when we isolate the impact of fuel prices, Fleet grew 3% in line with our expectations. This reflects the continued drag from the weakness in the micro SMB fleets and the recent change in sales focus to a slightly larger customer. We are seeing good success from our sales pivot with sales trends continuing to improve, and we feel good about our ability to re-accelerate the growth in the back half of the year. Brazil revenue was up 18% compared to last year as the business continues to perform at an extremely high level. Our strategy of using the vehicle, and now the Sem Parar mobile app for additional purchases like fuel, insurance, and certain retail purchases continues to grow, which significantly expands the addressable market across B2B and B2C. We have transformed the Brazil business beyond a single product toll tags business. It really is the center of an entire vehicle payments ecosystem that continues to grow, and we're the only provider that offers this breadth in the market. We have a highly differentiated value proposition in the marketplace, and it is clearly winning share. Lodging continued to perform well, growing 26%. This solid performance is highlighted by strong sales across our industry verticals that reflect our success in driving innovation to win new clients and capturing more business from existing clients. In addition, revenue per night increased 24% due to customer mix and additional fee-based revenue sources as we continue to expand our product capabilities. Our near-term focus is on consolidating our various hotel networks into one in order to enhance the customer experience. Looking further down the income statement. Operating expenses were $526 million, representing a 12% increase over the prior year, primarily due to the addition of the Global Reach operations and the capability acquisitions we made last year, like Plugsurfing in the EV space. The remaining increase in operating expense was primarily in Corpay and lodging, where we generated significant operating leverage. Bad debt expense was 8 basis points, but more importantly, slightly down sequentially from Q4 2022. Our delinquency trends give us confidence that we're on the path to lower bad debt expense in the back half of the year, even after giving consideration to a potentially soft macroeconomic cycle. The EBITDA margin in the quarter was 51%, 100 basis points better than Q1 2022. This includes $11 million or about 100 basis points of drag from expenses associated with recent acquisitions, including integrating and building out our AP automation and EV capabilities that we bought last year. We still expect our full-year EBITDA margin to increase approximately 150 basis points compared to last year, and Q4 to exit the year 200-250 basis points higher than Q4 2022. Remember, margins expand throughout the year as we generate revenue growth and realize the benefits of synergies from recent acquisitions. Interest expense increased by $58 million year-over-year, driven by higher rates on our debt stack. The impact of higher interest rates resulted in approximate $0.49 drag on first quarter adjusted EPS. Our effective tax rate for the quarter was 27.1% versus 26% last year, with the increase driven primarily by increases in tax rates in some international jurisdictions and some one-time discrete items. We anticipate the quarterly effective tax rate for the rest of the year to be between 26% and 27%. Turning to the balance sheet. We ended the quarter with about $1.3 billion in unrestricted cash, and we had $779 million available on our revolver. There was $5.5 billion outstanding on our credit facilities, and we had $1.3 billion borrowed in our Securitization Facility. As of March 31st, our leverage ratio was 2.7x trailing 12-month adjusted EBITDA, as calculated in accordance with our credit agreement. We made no open market share repurchases in the quarter as we deployed roughly $230 million in capital for three deals, including Global Reach, while also maintaining our leverage ratio. I would like to remind you that our first port of call for capital deployment is always accretive acquisitions. Then if there's nothing near term, we'll evaluate buybacks or debt paydowns as appropriate. We still have over $1.2 billion authorized for share repurchases. We believe we have ample liquidity to pursue near-term M&A opportunities and continue to buy back shares when it makes sense. In addition to Ron's overview of our full year guidance, let me give some additional detail, including some thoughts on our Q2 outlook and supporting assumptions, which can be found on slide 14. For the full year, we now expect GAAP revenues between $3.82 billion-$3.86 billion. Adjusted net income between $1.263 billion and $1.303 billion. Adjusted net income per diluted share between $16.95 and $17.35. Finally, EBITDA growth of 15%. All of these numbers include Russia for the full year. Assuming a June 30th close of our Russia business, we expect GAAP revenues to be $55 million-$65 million lower, resulting in a $0.30-$0.40 decline in adjusted EPS based on using the sale proceeds for buybacks over the remainder of the year. I also want to emphasize that the transaction is subject to approval by the Russian government, which involves an added level of complexity. For the second quarter, we're expecting revenue to be between $930 million and $950 million, and adjusted net income per share to be between $4.02 and $4.22, which at the midpoint is down slightly from what we reported in Q2 of 2022, which is driven by higher interest expense of approximately $60 million and roughly $20 million of expected macro headwinds from fuel price and FX rates. Related to our guidance assumptions, we are using $3.99 as our fuel price assumption for the rest of the year. Our interest expense guidance of $310 million to $330 million is based off an average LIBOR rate of 4.9% for the rest of the year. The rest of our assumptions can be found in our press release and supplement. Finally, I'd like to thank our 10,000 plus employees around the world who helped deliver a fantastic start to 2023. This quarter's results and our go-forward prospects reinforce the power of our growth-oriented, diversified business and the strength of our franchise. Thank you for your interest in FLEETCOR. Now, operator, we'd like to open the line for questions. Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your touch-tone phone. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. Our first question comes from Peter Christiansen with Citi. Please go ahead. Thank you. Good evening. Tom, welcome aboard here. It's great to have you. I had two questions here. There's a lot to dig into. Ron, I guess now with the new segmentation, how should we think about long-term kind of normalized growth for the fleet business now that we've added some other things to that segment? I know in the past you've talked about the segment being kind of like 4%-8%. Does that change with the new classification? Perhaps maybe we could also address Brazil in that same vein. Thank you. Yeah. Hey, hey, Pete, it's Ron. I'd say kind of in the, in the base business based on how we're allocating, you know, sales and marketing investment, we're probably still in that target range, kind of mid-single digits. I think the couple of wild cards on it are AEV, right? Does that thing, particularly with the early view we're getting of the economics, does that help accelerate it along with that consumer leg? B, do we get the cross-sell thing to hunt a bit more? I'd say, you know, the wild card is those two things. If those two things come in, obviously could accelerate, you know, quite a bit. Okay. That's helpful. I know the toll businesses in Brazil, they're switching to free flow. I know it's been a benefit to some toll payment administrators here in the U.S. when E-ZPass went free flow. Just curious your take on how that could impact the business near term. Thank you. Yeah, that's a good question. So far it's good news. It's for those that don't know, it's pretty early days in Brazil in terms of trying to make the transition to free flow, so they're actually testing it in one region. The good news on that, you know, for obviously for the toll operator is, hey, there's no more gates and stopping people. The bad news is the whatever the 20% or 30% of the people that don't have electronic, have a kludge bally way of, you know, paying after the fact. It'll help us. It's a tailwind short term because it makes the electronic, you know, blast right through even more attractive than today because again it's more difficult for people to follow up after the fact. We're actually seeing that, Pete, in the test region. In the one place where they put it in, we're actually doing a bit better. I'd say the only reason I'm not getting super excited is it'll probably take quite a while, right? There's a lot to test. There's a lot of infrastructure and stuff to move. You know, there's that post-payment thing to work out. I don't think it's gonna be, you know, super-duper immediately, but I'd say over the midterm, helpful to us. Yeah. Super helpful, Ron. Thank you. Yeah, good to talk to you. The next question comes from Andrew Jeffrey with Truist Securities. Please go ahead. Andrew? Ron, I wonder if you can update a little bit on the selling motion as you move up market in fuel. It sounds like you've met with some pretty good early success. Can you just kind of elaborate on what that looks like? Can you continue to go to market using primarily digital means? Is it more kind of feet on the street? Is there a pricing or yield difference on some of those bigger fleets? I just wanna try to understand how that might compare to how the fuel business looked prior. Yeah, Andrew, another good question. Point one is, we already sell upmarket. Although we don't say it, call it, I don't know, 40% of the sales, even in the U.S. business are kinda not digital, 40-50, we're already kinda in the business is point one. Point two is, I'd say even more so internationally, you know, we have way longer time in seat there with universal networks, we sold the bigger accounts for a lot longer. Back here to the U.S., the two ways that we'll kind of drift upmarket is one, this repointing of our digital engine. We basically kinda rework the algorithm there to look for different kind of, you know, search characteristics. We let through the door, if you will, we bid in a way basically to encourage, you know, bigger accounts to come to us, and obviously kind of shun smaller accounts. That's underway. We made that pivot, oh, call it last October, November. That's already started to work. Second, what you said, we're starting to grow now the feet on the street that would go into this seam. What we're working on is what I mentioned to Pete, Andrew, a few minutes ago of maybe going to market with not only the fuel card, but going to market with this Corpay One that kinda has the corporate payment stuff built into it, to see if that might be a little bit more compelling. We're kind of in test mode now of putting some people against, you know, a bit larger prospects and giving them something a little, you know, newer, kind of interesting to say. Those are the couple ideas. Okay. That's helpful. Then I like the, the UK mixed fleet disclosure slide from a revenue standpoint. Is it safe to assume that you see similar unit economics or maybe think about it as contribution margin in addition to more revenue? In other words, is operating leverage in those mixed fleet EV offerings? Yeah, I'd say that's, you know, way too early to call, right? We got a tiny little EV business and set of assets and cost structure. Our, you know, 99% focus at this point is on the revenue side, right? Figuring out how to serve these clients and when, and I don't know if people think it's a big deal, but, you know, as I kind of dug through the data, I'll say to everybody, it is a big deal, right? The company's real clients that we have are willing to pay us, you know, more money to be more helpful in more places. And if you look at the chart, kind of significantly more money. That is way different than I think we would have thought, you know, two years ago getting into the thing. What I would say people ought to focus on is the fact that we have it. I think I'm accurate in saying we're the only ones. There's no one else that has this three-in-one kind of offering that brings all the things together. I say come back, you know, Andrew, a different day to me on the, on the margin side. There's nothing structurally that would make us think we couldn't, you know, be at the same level over time. It's, it's just not where we're on today. Okay. Helpful. Thank you. Appreciate it. The next question comes from Sheriq Sumar with Evercore ISI. Please go ahead. Hey, thanks a lot for taking my question. I just wanted to get a sense on the trends in the month that you saw in the first quarter as to was there a sequential decline in the month of March versus what you saw in January and February, or was it highly consistent across all the months? Early read across how trends have been in April and any areas of weakness or strength that you have seen so far. Thank you. Yes, Sheriq, it's Ron. No, I'd say if anything, the months are increasing. We're in a snowball business where we add more than we lose. I think, I don't have it in front of me, but March has more work days, so it would have been a higher print. I did call out, we've had a pretty good peak, you know, here in April, both, you know, revenue and other trends. I'd say it's kind of spot on the plan, which obviously fits with the guidance. We're still just not seeing much. You know, we built a plan, whatever, a few months ago, and as you can hear from the results in the April comment, we're kind of tracking, you know, right where we thought. Thank you so much. Yeah, one follow-up. On corporate payments, if I remember correctly, on the last quarter, you had mentioned that the growth will be around 20%+, north of 20%, but now you had like around high teens, unless I'm wrong over here. I just wanted to get a sense as to what's causing the difference in outlook for corporate payments. Are you trying to pick on, hey, it's 19% instead of 20%? no, I thought it was more like, 20%+, I thought it probably was more like. 200 basis points of decline. Yeah. If you go back and read kind of prior scripts, I would have said high teens to 20. 19, I think qualifies as high teens. I did say I think it's likely you will see in one of the next two or three quarters the thing tick above the 20%. Again, we try to build, design that business to run right around the, you know, 20% plus or minus. Still highly confident in that. Thank you so much. Yeah, that helps. The next question comes from Sanjay Sakhrani with KBW. Please go ahead. Thanks. Ron, appreciate the commentary on the strategic review committee, and it seems like you're on board. I know in the past you've considered divestitures or sales of some of the businesses, and the price simply was not compelling enough. I'm just curious, one, has the backdrop changed in terms of that pricing, or are you just willing to make the deal in the name of simplification? Second, maybe you could just talk about core versus non-core, sort of how you guys are looking at this. Yes, Sanjay. Hey, on the first part of your question, the backdrop has changed our value of our earnings, right? Historically, I'd say up until call it the last year and a half, we traded in the, you know, mid to high teens EBITDA, kind of next 12 months EBITDA. To trade it, you know, call it 10x, 11 x is the first part of the backdrop. A price from a third party that would be, you know, a lot higher than where we are would be more interesting to me than it would have been when we traded obviously at 15%-20%. In terms of the segments, I'd say it's really the size of the businesses is how we think about, you know, things that are core. Things that are big for us, you know, and have big, you know, leadership positions, we would call, you know, core. You know what those are. That would be Fleet, you know, Brazil, corporate payments. Lodging for sure would be businesses that we would view as big and core and have great positions. Again, as I said, you know, in the opening comments, when you're trading for whatever reason at this level, we are, starting with me, we are wide open to someone else other than who's in our stock, you know, valuing, some or all of the company at a more appropriate level. I do wanna make sure people know we are out, you know, talking and trying to get feedback, you know, if we can ID people that would value some or all of the business higher. Okay. Just a follow-up on the Russia sale. I guess, can you just elaborate a little bit on what specific approvals are needed from the Russian authorities? I mean, how much time that takes if this presents a risk? Thanks. Yeah, that's also a good question. I don't know how many months ago, somewhere three to six months ago, the Russian government created a separate, I don't know if you call it agency, commission, group, whatever it is, for this purpose of international Western companies trying to exit, and effectively created a sign-off requirement, almost like an antitrust or something oversight. As Western companies like us, make deals, right, sign SPAs to sell things, then these go to this group, this agency, this committee, whatever it is, and they opine on it. "Hey, we're happy to, you know, approve this deal," or, "Hey, we'd like to see, you know, this or that." That's what it is. We've been told that, you know, it's a month or two. I think it's a function, right, of the volume of transactions that are in front of the group. They have been, you know, we've looked at the history. As long as they've been established, they have been processing, you know, one way or the other, transactions. We do think, obviously the buyer there is communicating to us that they're in conversations with this group. It's in some kind of a process. Risk, yes, that's why I used the word. You know, there's some hoops. For us to say we know how that ball's gonna bounce would, you know, not be accurate. We have an agreement, and assuming that it gets approved, you know, we will transact. Our best guess, it's probably in the next 60 days. I want people on the call, it is not risk-free. There's obviously some chance that they would deny the sale or ask for changes in the sale that aren't palatable. You know, we're just kind of waiting. Okay. Great. Thank you. The next question comes from Ken Suchoski with Autonomous Research. Please go ahead. Hi. Good afternoon, Ron and Tom. Thanks for taking the questions. Tom, congrats on the new role. Great to connect again. It's great to hear the comments on the portfolio review and that you're moving quickly on that front. You know, there have been some discussions going around that FLEETCOR should consider breaking up the business and maybe ring-fence some of the things that might be weighing on the multiple. I guess, one, you know, what is your preliminary analysis pointing to in terms of value creation, as well as any dyssynergies that need to be taken into account? I guess if you were to go through with the potential, you know, corporate action, what might a separation look like, and how should we think about the timing around that? Yeah, Ken, I'd say, it's too early really to try to answer that. We're, whatever, five or six weeks, you know, into kicking this thing into gear and studying it. We don't really have a super formed view. I think I kind of said what I said, which is we're underway. We've run, tumbled a bunch of numbers. We're obviously out talking to people. Really we're just working our way through the options. As I said, would be, you know, in a way better spot for a clearer answer to you in 90 days. Okay. Okay. We'll, we'll wait on that, Ron. I guess as my follow-up, can you talk about the trends you're seeing on the corporate payment side? I mean, it kind of feels like the current macro slowdown or recession looks a little different than 2008, 2009, and maybe businesses might be pulling back ahead of the consumer. Maybe you could just talk about how you're feeling about the spending trends in the corporate payment segment, and then any puts and takes across the underlying businesses within that segment. Sure. I'd say that, you know, I think we report spend in some of the appendices here and stuff, so it continues to be strong, really across the board. I think maybe most importantly is the sales are just record levels. I mean, our Q1 sales in our corporate payments business was not only an all-time high, it was an all-time high by, I don't know, 50% or something. We're pouring money into advertising the brand now and reaching more people. We've got more people on the street. We finally have a really, you know, put together product line. I think the fill in the top of the bucket is in its really the best place that it's ever been in. I think it's, you know, without getting over my skis, it's kind of all systems go. The thing's working. Our outlook is to compound now, like I said, high teens to 20%. Other than the channel thing, which is, I don't know, 10%, 12% of the business now, really all the, all the other parts of that business are rocking. No, no warning flags at all. Great. Thanks, Ron. Thanks, Ken. Got it. The next question comes from Trevor Williams. Please go ahead. Great. Thanks for taking the question. I wanted to ask on corporate payments in the cross-border business in particular, maybe just higher level, if you could give us a refresher just on what differentiates you on the cross-border and the FX side. Now with AFEX and Global Reach, just the main benefits you get with that at its scale, and then how that feeds into the durability of the growth that you're seeing there? Thanks a lot. Yeah, that's really super good question, Trevor. The first and most important thing I think I'd say is, who do we compete with? How do we get business and who would we lose business to? The answer is banks. Because we mostly serve the middle market, it's tier two banks. It's super important that everyone has that in their brain. You know, I don't say we're playing little league, but maybe we're playing minor league baseball, you know, versus Major League baseball. We have to be able to get a mid-size business to trust us to make either spot or, you know, hedge transactions for them versus a, let me call it kind of a tier two bank. When you have that context, the answer is we gotta win everywhere. We have a better network, right, in terms of basically the destination, if you will, of payments, more breadth, more countries. We have better tech because it's all we do versus a bank, you know, running or using some third party. The winner, I think, Trevor, is the people. We just have more specialists, right? We have hundreds of people in these different originating markets here, Canada, U.K., Europe, Australia, that really know FX, that have grown up in FX. I think they really just outthink and outpitch the representatives that are at these tier two banks. It's, it's the combo of all of those things. We, we compete well because honestly, who has the book of business, would be my answer to you. Okay. Got it. Thanks. On the fleet segment, any help just in how we should think of the cadence of growth over the course of the year as the pivot of, you know, new sales to the larger customers as those start to flow through? Ron, I think you said earlier on, you know, getting to the mid-single digits, just any way you could put a finer point around timing and just as we're thinking of the next three quarters, just progression of growth in fleet would be helpful. Thanks. Yeah. Super good question. I'd say think of it as just stepping up. If it's, call it three for the print for Q1, and we're gonna end middle kind of, you know, three, four, five, six, three, you know, five, six, seven. It's gonna step up basically based on the plan we've built. Kind of a point or so acceleration sequentially. Okay. Perfect. Thank you. The next question comes from Bob Napoli with William Blair. Please go ahead. Hi, this is Spencer Janzon for Bob Napoli. Thanks for taking the question. The new sales definitely impressed us. Ron, could you maybe just provide a summary of what's driving the strength, the new sales, and the components of that number and what's driving the strength there? Maybe if you could touch on how the digital ad environment may or may not be impacting the new sales motion. Yeah. I'm not so sure, Spencer, the second part of the question, but the first part I can cover, which is, yeah, it was a crazy good sales quarter, right? We're telling you guys up 31%, and that's in the face of taking the gas off of our North America fleet business, right? We used to get, I don't know, 10%-15% of the business in that micro segment, and I just shut it down, right, to try to contain. It tells you that the rest of international fleet and all the rest of the businesses grew faster even, you know, than 31%. I think it's a combo of things. One is, again, we've stepped up marketing and sales investment, particularly marketing. We've been pouring more money in corporate payments into this Corpay brand campaign. You know, that's helping a lot. Then I'd say second, I think we're finally getting the hang of digital leads, which is generating way more leads in every business. We have a couple of unique campaigns, digital campaigns, both in fleet. We call one of them Barbara. I know, I feel like I'm naming boats or something here. And one in our lodging business called Sarah. These campaigns that kind of create a bit of a personality in this space have been incredibly successful for us. I don't want to say they're shooting fish in a barrel, but the sales force is getting fed with a lot more quality leads, call it in the last year, than they were before. It's just all good. It's inflationary times. We have kind of cost reduction products. We have better products than we had. We have more people on the street, and our lead thing is working better. I mean, I just say to you, it's just, it's working, what we're doing. Great. Thank you for the color. As a follow-up, maybe an update on credit and fraud trends in the fleet business. Yeah. I don't know if we, Alissa, print that or not. It's a smidgy bit better sequentially from Q4. Again, based on when we started to take the actions, most of the benefit in terms of improvement is expected in the second half. We're seeing a lot kind of in our, what we call our delinquency roll rate. We're staring at the last week. We have super good visibility into Q2, which doesn't necessarily impact the credit reserve we'll take for this quarter, but it super does for the following quarter. We can see that thing really coming down. You know, I don't know if we can take it to the bank yet, but the early warning, the early good news signs are that the actions we've taken are gonna take credit losses down in the second half like we planned. Then same on the fraud side. The fraud side has been a combo of what we call application fraud, you know, which are phony people pretending to be somebody and getting us. We basically put in a bit of a new system that does way better at that. Has a few more variables that it looks at before it says okay. Then the second one is just, you know, criminal fraud, right? People, you know, at a truck stop, putting in skimming and selling cards and stuff. I think we're down 40% in fraud sequentially in those couple of areas. Our partners, like the truck stop partners, have been helpful in trying to, you know, police that better at the site. As those numbers got bigger, right, because fuel prices, what, Q2, I guess, peaked last year, I'm gonna say Q2. You know, it became a more attractive target. It took time, I think, for us and others to get on it. You know, not mission accomplished yet, but we're making good progress. Great to hear. Thank you. Good question. The next question comes from James Faucette with Morgan Stanley. Please go ahead. Great. Thanks. I had a couple of follow-up operational questions here. Retention that quarter was really strong. I think it was like 91.2%, but was down about 100 basis points from last quarter. I know you just mentioned kind of the credit actions taken, but can you expand if there were any other factors driving that? Is there seasonality, et cetera, that we should be aware of? How are you thinking about that for the remainder of the year? Yeah, James, Ron again. No, that's it. I mean, the reason it shows up there is what we call involuntary attrition, which is about half of our losses, right? Let's use 10% not to hurt our head. Hey, 10% of our customers, you know, quit us every year. We quit five of them, which means we got uncomfortable with your credit profile, you're not our customer anymore. When you go through what we did of having, you know, a heightened attention on these smallish one, two, three, kind of card accounts, you know, we took actions basically to cut lines and pull back payment cycles and stuff, really just obviously to contain losses. That just translates into us effectively kicking those clients out. That's it. That's the totality of the thing. I want everyone clear, we did it with our eyes just completely wide open. Based on what we're seeing, you know, happy that we did it. To your opening comment, we're still. I worked for ADP for 10 years, I'm still super happy with a consolidated 91%, you know, revenue retention rate. No tears here. Got it. You know, just to follow up on, there's been a lot of conversation obviously on segments and strategy, et cetera. You know, from a realignment perspective, at least as you've redefined, some of the segment definitions, any change to how that strategically impacts those businesses or, plan go to market, et cetera? Yeah, that's really a super good question. Yeah. Let me say what I think kind of the insight is, and it comes a little bit from how we started on kind of a product-centric view of our lines of business versus a market, right, or customer-centric view. I think the Brazil guys, that I called out, you know, at the top of the call, they've proven that if you wanna redefine your business as, hey, I'm gonna help vehicle-related drivers make payments, you know, whether they're a business guy driving around or whether they're a consumer driving around, all those things that you pay related to the vehicles, right? Fuel, toll, EV, maintenance, stopping for food, parking, you know, now even insurance, that those things. Getting into those shows that the businesses and the consumers believe that our business has the right to offer, to provision all of those payment things, and having all those things on one account seems like a good idea to them. I'd say that's kind of where we're headed. The idea would be to basically, you know, stop looking at the thing as, hey, you're driving around, and we're selling you one thing. Go to Europe, where now talked about the three-in-one. We're selling fleets, but we're also selling, you know, old-fashioned diesel and EV. You know, why can't we sell parking and toll and insurance to those sets of millions of users and stuff? I think that's the strategic turn for us, is to think about really the multiple things we could sell to the same customer that makes sense to them. The great news is we have a live case, like a, you know, a real case of that. The other thing I'm guessing people missed is the phone, right? The mobile phone is starting to matter. Like, when I tell you that 3 million out of 5 million users, consumers in Brazil decided to go to our phone app in a month. I don't know if that's crazy to you guys, but it is to me. You know, we used to stick a tag on the windshield, now 60% of the people are on their phone in our app looking for stuff. That creates, I think, an enormous ability, again, to offer up, like the insurance example, more things to the customer base. The headline is we're looking at the world more through the lens of the customer and what we can offer than we are, you know, product by product. Got it. Got it. Really appreciate color commentary there, Ron. You got it. The next question comes from Jeff Cantwell with Wells Fargo. Please go ahead. Hey, thanks so much. Just to follow up on some of the questions about core versus non-core, and you're giving us a ton of color on this. You know, I just wanted to bounce something off of you and see if you would, you know, agree that this is a fair statement that over the years, amongst fleet corporate payments and lodging, there would be potentially, you know, a number of operational synergies amongst those three segments. You know, the clear follow-up question to that would be could you maybe give us some comments on Brazil within the context of core versus non-core? Just curious how that piece of your business ties in with the rest. Thanks so much. I think, Jeff, I kinda just said it to me in some ways, Brazil is the lead dog. It's kind of the poster child for really, you know, how we should think about the portfolio, right? That, hey, when we bought that business seven years ago, it was mostly a toll-centric business, and it's transformed right into, like I said, selling five or six things to the same both businesses and consumers. Notice how we're selling EV, right, to both businesses and consumers. We're just basically repurposing the networks and the tech. Obviously, that's what Brazil has done, right? They've got, you know, toll networks that both use. They've got fuel networks that both use. They have parking that both use. They've literally taken the same networks and tech and sold the stuff to the two different groups. I'd say, if anything, that business looks more related. The other thing which is so weird is Fleet's in eight giant markets today. Fleet's not only in the USA, it's in, obviously, the U.K., it's in Czech, it's in Germany, it's in Russia, it's in Australia, it's in Canada, obviously, and it's in Brazil. Obviously, we have a fleet business that's in eight geographies, of which one of them just happens to be Brazil. Our lenses are, in some ways, it is. The most related business in the company to our fleet business would be our Brazil business because all it is is another country doing fleet and vehicle stuff. I would say that would be a super-duper long shot. The other thing is I like businesses that are working just as an aside. The fact that the business is compounding in the teens, you know, and pressed above the 50% EBITDA line and beating down people that are giving things away for free and continuing to compound, we like that. I mean, I don't know about you guys, I like that like a lot, the performance of the business. Okay, thanks very much. My follow-up is for Tom. You know, for those of us who have not covered you, at your prior, would you maybe just, you know, if you don't mind, give us a sense of, you know, how you think, strategically and also, you know, conceptually about, you know, managing the business and so forth. Would love to get your thoughts on, you know, what your mindset is as you're coming on board here. Thanks so much. Sure, Jeff. Look forward to working with you, and good to work with many of you on the call that, you know, did cover EVO. You know, my DNA as a finance person is really to approach it from a business-centric perspective. I've had the benefit over the last, you know, month or so being able to participate in a variety of meetings here, really learning the company, firsthand. Getting grounded in how the business operates is centric to how I and the rest of the team, within finance thinks and supports the business. You know, our role is to make sure we bring, good information and good advice and ideas, to the business. We can't do that by just looking at the output of the results. I've said repeatedly over the course of my career, I like focusing on the inputs in order to drive the outputs. My dialogue and the team's dialogue with the business is around their KPIs. If we can get their focus on their KPIs and how those KPIs drive the kind of outcomes that we're looking for financially, then the company wins. You'll find me and again, the rest of the team very focused on making sure that we understand, you know, how the business is operating and how we can help it become more and more successful. Very focused on, you know, things up and down the income statement and balance sheet. No real bias there. It's where the opportunity is where we'll focus. Okay. Appreciate all that. Thank you. The next question comes from Mihir Bhatia with Bank of America. Please go ahead. Hi, sorry. Thank you for taking squeezing me in here. My first question just has to do with the consumer EV build-out that you kind of mentioned, Ron. Can you maybe expand on that? Is the idea there to build a FLEETCOR consumer brand or are you white labeling? I mean, I guess, you know, based on some of your other comments about Brazil, is the thinking there that using EV instead of tolls, you can do something similar on the consumer side as what they've done in Brazil using tolls as the wedge, if you will? Yeah, that's a good question. As I mentioned at the top, the motivation initially here is repurposing assets we have, which are networks, right, and tech. Your comment about, you know, brand is a good one. The first thing I'd say is some of that build initially will be under other people's brands, where we'll be kind of the intel inside. What I mean by that is think of us going to an EV car manufacturer, you know, pick some Volvo, Renault, somebody who's making EV cars, and they want to give their new buyers an easy way to find public recharging and pay for it. They're gonna use our network and our app. The brand, and sometimes even the app, will get pulled into, you know, Renault's or Volvo's way, right, of communicating. That's one. Leveraging kind of the car maker's brand to get to those drivers. The second one is kind of the CPOs, the gas stations, if you will, the charging charge point operators is what they call them. Same thing, we would go to someone that's got, you know, 100 charge points and has, you know, customers coming in that wants them to be able to roam to go to places other than their 100. They would be trying to sign those customers up and get them under an app that we would provide them. That's the first headline, is that some amount of our consumer business would leverage these intermediary brands. Lastly, I think it is a good idea. We have this brand, this company we bought, called Plugsurfing, which I guess kind of sounds like an EV brand. Yeah, we're not gonna use for sure the FLEETCOR brand. We want something that's, you know, representative of EV. We might invest, we may take a market to your point and invest digitally to see if we can build, you know, that brand and add some consumers directly. That's for a different day. Understood. Thank you. Then just switching gears to this year, obviously you're seeing some sales momentum that you've highlighted. Just in general, as you sit here today, do you think things are getting better or worse relative to, you know, three months ago? Because there's a lot of conflicting data. I guess from your, the data you are seeing, are you seeing any pockets of weakness across your offerings or is it really just the macro is the only like, you know, outside macro is the big question mark for you? Yeah. You know, I know it's a question on everyone's mind, but I guess I'd make a couple of points. First is our best internal metric here is what we call same store sales, which basically isolates existing clients in the period that we had in the same period a year ago and just asks, "Hey, are they getting healthier or sicker?" The answer is healthier. Across the globe, at least among our clients, they're + 3% healthier than they were 12 months ago. That's kind of point 1. The second point is our company, you know, that grows, you know, revenues double digit and grows profits faster isn't super reliant on GDP. I don't know what our GDP is here in the US or in some of our big markets, but let's say it's 1% or 2%. We're growing by gaining share, right? We sell way more than we lose. The growth rate and potential of our company is way more in our control of being able to sell way more businesses at the top of the bucket and lose less businesses at the bottom. If the existing clients shrink a point or so, oh well is me for a quarter or two maybe, but that's not our game. Our game is to basically power through, you know, either happier or a little bit sadder, you know, GDP kind of environment. Again, we're not seeing much, and frankly, I think it's the impact, you know, it's at the margin for us. Understood. Thank you. You got it. This has concluded our question and answer session, and the conference has also now concluded. Thank you for attending today's presentation. You may all now disconnect. We're going straight to the next one. All right. Cool. I never saw Ginji on the call. He wasn't in the Q&A. That's kind of weird. It is. I'll let you.