~~See accompanying notes to unaudited consolidated financial statements.~~

~~FleetCor~~FLEETCOR Technologies, Inc. and Subsidiaries

Unaudited Consolidated Statements of Comprehensive Income

(In Thousands)

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Net income $ 202,823
$ 129,618
$ 457,503
$ 356,961
Other comprehensive (loss) income:
Foreign currency translation gains (losses), net of tax 112,301
(52,409 ) 168,655
(41,339 )
Reclassification of foreign currency translation loss to investment, net of tax 31,381
—
31,381
—
Total other comprehensive income (loss) 143,682

(52,409 )
200,036

(41,339 )
Total comprehensive income $ 346,505

$ 77,209

$ 657,539

$ 315,622


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net income	$	271,496	$	248,885	$	726,033	$	729,008
Other comprehensive (loss) income:
Foreign currency translation losses, net of tax	(157,043)		(252,719)		(16,387)		(228,666)
Reclassification of accumulated foreign currency translation losses to net income as a result of the sale of a foreign entity (see Note 15)	120,269		—		120,269		—
Net change in derivative contracts, net of tax	32,103		6,107		43,834		32,837
Total other comprehensive (loss) income	(4,671)		(246,612)		147,716		(195,829)
Total comprehensive income	$	266,825	$	2,273	$	873,749	$	533,179

See accompanying notes to unaudited consolidated financial statements.

~~FleetCor~~

FLEETCOR Technologies, Inc. and Subsidiaries

Unaudited Consolidated Statements of Stockholders’ Equity

(In Thousands)


	Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Total
Balance at December 31, 2022	$	128	$	3,049,570	$	7,210,769	$	(1,509,650)	$	(6,209,324)	$	2,541,493
Net income	—		—		214,835		—		—		214,835
Other comprehensive income, net of tax	—		—		—		75,634		—		75,634
Acquisition of common stock	—		—		—		—		(9,597)		(9,597)
Stock-based compensation	—		26,096		—		—		—		26,096
Issuance of common stock	—		33,399		—		—		—		33,399


Balance at March 31, 2023	128		3,109,065		7,425,604		(1,434,016)		(6,218,921)		2,881,860
Net income	—		—		239,702		—		—		239,702
Other comprehensive income, net of tax	—		—		—		76,753		—		76,753
Acquisition of common stock	—		—		—		—		(2,376)		(2,376)
Stock-based compensation	—		34,748		—		—		—		34,748
Issuance of common stock	—		32,749		—		—		—		32,749
Balance at June 30, 2023	128		3,176,562		7,665,306		(1,357,263)		(6,221,297)		3,263,436
Net income	—		—		271,496		—		—		271,496
Other comprehensive loss, net of tax	—		—		—		(4,671)		—		(4,671)
Acquisition of common stock	—		(13,212)		—		—		(521,725)		(534,937)
Stock-based compensation	—		29,073		—		—		—		29,073
Issuance of common stock	1		35,053		—		—				35,054
Balance at September 30, 2023	$	129	$	3,227,476	$	7,936,802	$	(1,361,934)	$	(6,743,022)	$	3,059,451

Table of Contents

FLEETCOR Technologies, Inc. and Subsidiaries

Unaudited Consolidated Statements of Stockholders’ Equity

(In Thousands)


	Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Total
Balance at December 31, 2021	$	127	$	2,878,751	$	6,256,442	$	(1,464,616)	$	(4,804,124)	$	2,866,580
Net income	—		—		217,952		—		—		217,952
Other comprehensive income, net of tax	—		—		—		201,179		—		201,179
Acquisition of common stock	—		—		—		—		(422,736)		(422,736)
Stock-based compensation	—		32,631		—		—		—		32,631
Issuance of common stock	—		8,810		—		—		—		8,810
Balance at March 31, 2022	127		2,920,192		6,474,394		(1,263,437)		(5,226,860)		2,904,416
Net income	—		—		262,171		—		—		262,171
Other comprehensive loss, net of tax	—		—		—		(150,396)		—		(150,396)
Acquisition of common stock	—		—		—		—		(372,566)		(372,566)
Stock-based compensation	—		34,017		—		—		—		34,017
Issuance of common stock	1		10,026		—		—		—		10,027
Balance at June 30, 2022	128		2,964,235		6,736,565		(1,413,833)		(5,599,426)		2,687,669
Net income	—		—		248,885		—		—		248,885
Other comprehensive loss, net of tax	—		—		—		(246,612)		—		(246,612)
Acquisition of common stock	—		—		—		—		(500,342)		(500,342)
Stock-based compensation	—		34,180		—		—		—		34,180
Issuance of common stock	—		3,272		—		—		—		3,272
Balance at September 30, 2022	$	128	$	3,001,687	$	6,985,450	$	(1,660,445)	$	(6,099,768)	$	2,227,052

See accompanying notes to unaudited consolidated financial statements.

FLEETCOR Technologies, Inc. and Subsidiaries

Unaudited Consolidated Statements of Cash Flows

(In Thousands)

Nine Months Ended
September 30,
2017 2016
Operating activities
Net income $ 457,503
$ 356,961
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 35,096
25,706
Stock-based compensation 68,897
50,025
Provision for losses on accounts receivable 35,949
24,512
Amortization of deferred financing costs and discounts 5,411
5,568
Amortization of intangible assets 158,897
112,455
Amortization of premium on receivables 4,738
3,687
Loss on extinguishment of debt 3,296
—
Deferred income taxes (38,092 ) (23,566 )
Investment loss (income) 52,497
(2,247 )
Gain on disposition of business (174,984 ) —
Other non-cash operating income (49 ) (690 )
Changes in operating assets and liabilities (net of acquisitions and dispositions):
Restricted cash (12,105 ) (28,744 )
Accounts and other receivables (440,011 ) (527,255 )
Prepaid expenses and other current assets (86,648 ) (1,291 )
Other assets (15,378 ) (9,115 )
Accounts payable, accrued expenses and customer deposits 364,473
418,280
Net cash provided by operating activities 419,490

404,286
Investing activities
Acquisitions, net of cash acquired (602,298 ) (1,331,079 )
Purchases of property and equipment (49,459 ) (41,877 )
Proceeds from disposal of a business 316,501
—
Other (6,327 ) 1,411
Net cash used in investing activities (341,583 )
(1,371,545 )
Financing activities
Proceeds from issuance of common stock 20,192
18,620
Repurchase of common stock (402,392 ) (35,492 )
Borrowings on securitization facility, net 203,000
42,000
Deferred financing costs paid and debt discount (11,230 ) (2,272 )
Proceeds from issuance of notes payable 780,656
600,000
Principal payments on notes payable (388,656 ) (85,125 )
Borrowings from revolver – A Facility 845,000
1,105,107
Payments on revolver – A Facility (804,808 ) (670,940 )
Borrowings on swing line of credit, net 7,800
5,188
Other 537
(673 )
Net cash used in financing activities 250,099

976,413
Effect of foreign currency exchange rates on cash 31,732
(50,871 )
Net increase (decrease) in cash and cash equivalents 359,738
(41,717 )
Cash and cash equivalents, beginning of period 475,018
447,152
Cash and cash equivalents, end of period $ 834,756

$ 405,435
Supplemental cash flow information
Cash paid for interest $ 79,144
$ 48,525
Cash paid for income taxes $ 257,349
$ 79,599


	Nine Months Ended September 30,
	2023		2022
Operating activities
Net income	$	726,033	$	729,008
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	82,028		67,066
Stock-based compensation	89,917		100,828
Provision for credit losses on accounts and other receivables	103,495		89,976
Amortization of deferred financing costs and discounts	5,417		5,949
Amortization of intangible assets and premium on receivables	170,630		165,423
Loss on extinguishment of debt	—		1,934

Deferred income taxes	(18,911)		(7,987)

Gain on disposition of business, net	(13,712)		—
Other non-cash operating expense, net	491		601
Changes in operating assets and liabilities (net of acquisitions/disposition):
Accounts and other receivables	(809,487)		(950,237)
Prepaid expenses and other current assets	114,237		(25,570)
Derivative assets and liabilities, net	(7,939)		10,756
Other assets	33,090		(16,154)

Accounts payable, accrued expenses and customer deposits	428,580		267,014
Net cash provided by operating activities	903,869		438,607
Investing activities
Acquisitions, net of cash acquired	(429,914)		(160,117)
Purchases of property and equipment	(117,158)		(107,631)
Proceeds from disposal of a business, net of cash disposed	197,025		—
Other	4,401		—
Net cash used in investing activities	(345,646)		(267,748)
Financing activities
Proceeds from issuance of common stock	101,202		22,109
Repurchase of common stock	(546,910)		(1,295,644)
Borrowings on securitization facility, net	109,000		364,000
Deferred financing costs	(238)		(10,282)
Proceeds from notes payable	—		3,000,000
Principal payments on notes payable	(70,500)		(2,800,500)
Borrowings from revolver	6,495,000		4,338,000
Payments on revolver	(6,770,000)		(3,658,000)
Borrowings on swing line of credit, net	180,723		194

Other	264		—
Net cash used in financing activities	(501,459)		(40,123)
Effect of foreign currency exchange rates on cash	(30,431)		(80,551)
Net increase in cash and cash equivalents and restricted cash	26,333		50,185
Cash and cash equivalents and restricted cash, beginning of period	2,289,180		2,250,695
Cash and cash equivalents and restricted cash, end of period	$	2,315,513	$	2,300,880
Supplemental cash flow information
Cash paid for interest	$	327,099	$	138,310
Cash paid for income taxes	$	319,764	$	309,567



See accompanying notes to unaudited consolidated financial statements.

~~FleetCor~~

Table of Contents

FLEETCOR Technologies, Inc. and Subsidiaries

Notes to Unaudited Consolidated Financial Statements

September 30, ~~2017~~2023

1. Summary of Significant Accounting Policies

Basis of Presentation

Throughout this ~~report,~~Quarterly Report on Form 10-Q, the terms ~~“our,” “we,” “us,”~~"our," "we," "us," and the ~~“Company”~~"Company" refers to ~~FleetCor~~FLEETCOR Technologies, Inc. and its subsidiaries. The Company prepared the accompanying unaudited interim consolidated financial statements in accordance with ~~Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by~~ accounting principles generally accepted in the United States of America (“GAAP”)~~. The~~ for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and note disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to those rules and regulations, although we believe that the disclosures made are adequate to make the information not misleading. In our opinion, the unaudited interim consolidated financial statements reflect all adjustments considered necessary for fair presentation. These adjustments consist of normal recurring accruals and estimates that impact the carrying value of assets and liabilities. Actual results may differ from these estimates. ~~Operating results for the three and nine month periods ended September 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017.~~

The unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2022.

Use of estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Future events and their effects cannot be predicted with certainty; accordingly, accounting estimates require the exercise of judgment. These financial statements were prepared using information reasonably available to us as of September 30, 2023 and through the date of this Quarterly Report. The accounting estimates used in the preparation of the Company’s interim consolidated financial statements may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. Actual results may differ from these estimates due to the uncertainty around the ongoing conflict between Russia and Ukraine, the impact of changes to monetary policy, as well as other factors.

Foreign Currency Translation

Assets and liabilities of foreign subsidiaries are translated into U.S. dollars at the rates of exchange in effect at period-end. The related translation adjustments are ~~made directly~~recorded to accumulated other comprehensive ~~income.~~loss. Income and expenses are translated at the average monthly rates of exchange in effect during the ~~period.~~year. Gains and losses from foreign currency transactions of these subsidiaries are included in net income. The Company recognized foreign exchange gains ~~of $0.6 million~~ and ~~foreign exchange~~ losses, ~~of $0.7 million in the three months ended September 30, 2017 and 2016, respectively,~~ which are recorded within other (income) expense, net in the Unaudited Consolidated Statements of ~~Income. The Company recognized foreign exchange losses of $0.2 million~~Income, for the three and ~~$1.5 million in the~~ nine ~~month periods~~months ended September 30, ~~2017~~2023 and ~~2016, respectively.~~2022 as follows (in millions):

~~Derivatives~~


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Foreign exchange losses	$	(6.4)	$	(1.9)	$	(6.2)	$	(4.1)

Foreign exchange losses for the three and nine months ended September 30, 2023 include a $5.6 million exchange loss incurred in connection with the Company's disposition of its Russia business upon conversion of the ruble-denominated proceeds to U.S. dollars. See Note 15 for additional information.

~~With its acquisition~~The Company recorded foreign currency gains on long-term intra-entity transactions included as a component of ~~Cambridge Global Payments ("Cambridge")~~foreign currency translation losses, net of tax, in ~~August 2017,~~the Unaudited Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2023 and 2022 as follows (in millions):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Foreign currency gains on long-term intra-entity transactions	$	31.0	$	27.8	$	43.4	$	184.1

Cash, Cash Equivalents, and Restricted Cash

Cash equivalents primarily consist of a) cash on hand, b) highly liquid investments with original maturities of three months or less, such as certificates of deposit and treasury bills, and c) customer deposits repayable on demand without legal restrictions. Restricted cash primarily represents a) customer deposits repayable on demand held in certain geographies with legal restrictions, b) collateral received from customers for cross-currency transactions in our cross-border payments business, which are restricted from use other than to repay customer deposits and secure and settle cross-currency transactions, and c) collateral

posted with banks for hedging positions in our cross-border payments business. During the third quarter of 2023, the Company ~~uses derivatives~~disposed of its Russian net assets, including its cash balances. See Note 15 for additional information. Based on our assessment of the capital market conditions and related impact on our access to ~~facilitate cross-currency corporate~~cash prior to the Russia disposition, we had reclassified all cash held at our Russia business of $215.8 million at December 31, 2022 to restricted cash.

Financial Instruments - Credit Losses

The Company accounts for financial assets' expected credit losses in accordance with Accounting Standards Codification (ASC) 326, "Financial Instruments - Credit Losses". The Company’s financial assets subject to credit losses are primarily trade receivables. The Company utilizes a combination of aging and loss-rate methods to develop an estimate of current expected credit losses, depending on the nature and risk profile of the underlying asset pool, based on product, size of customer and historical losses. Expected credit losses are estimated based upon an assessment of risk characteristics, historical payment experience, and the age of outstanding receivables, adjusted for forward-looking economic conditions. The allowances for remaining financial assets measured at amortized cost basis are evaluated based on underlying financial condition, credit history, and current and forward-looking economic conditions. The estimation process for expected credit losses includes consideration of qualitative and quantitative risk factors associated with the age of asset balances, expected timing of payment, contract terms and conditions, changes in specific customer risk profiles or mix of customers, geographic risk, economic trends and relevant environmental factors.

Revenue

The Company provides payment solutions to our business, merchant, consumer and payment network customers. Our payment solutions are primarily focused on specific commercial spend or geographically defined categories, including Fleet, Corporate Payments, Lodging, Brazil and Other (stored value cards and e-cards). The Company provides solutions that help businesses of all sizes control, simplify and secure payment of various domestic and cross-border payables using specialized payment products. The Company also provides other payment solutions for fleet maintenance, employee benefits and long haul transportation-related services. Revenues from contracts with customers, within the scope of ASC 606, "Revenue Recognition", represent approximately 84% and 85% of total consolidated revenues, net, for the three and nine months ended September 30, 2023. In its cross-border payments by writing derivatives to customers, which are not designated as hedging instruments. The majority of this business' revenue is from exchanges of currency at spot rates, which enable customers to make cross-currency payments. In addition, this business, ~~also~~the Company writes foreign currency forward and option derivative contracts for its customers to facilitate future ~~payments.~~payments in foreign currencies. These contracts are accounted for in accordance with ASC 815, "Derivatives and Hedging" and represent approximately 9% and 8% of total consolidated revenues for the three and nine months ended September 30, 2023, respectively. Additionally, the Company accounts for revenue from late fees and finance charges, in jurisdictions where permitted under local regulations, primarily in the U.S. and Canada in accordance with ASC 310, "Receivables". Such fees are recognized net of a provision for estimated uncollectible amounts, at the time the fees and finance charges are assessed and services are provided and represent approximately 4% and 5% of total consolidated revenues, net for the three and nine months ended September 30, 2023. The ~~duration~~Company's remaining revenue represents float revenue earned on invested customer funds in jurisdictions where permitted. Our revenue is generally reported net of the cost for underlying products and services purchased through our payment solutions. In this report, we refer to this net revenue as "revenue".

Table of Contents

Disaggregation of Revenues

The Company provides its services to customers across different payment solutions and geographies. The Company's solutions have been merged to align with its segments. Revenue by solution (in millions) for the three and nine months ended September 30, was as follows:


Revenues, net by Solution*	Three Months Ended September 30,								Nine Months Ended September 30,
	2023		%		2022		%		2023		%		2022		%
Fleet	$	365.5	38	%	$	395.2	44	%	$	1,120.8	40	%	$	1,124.2	44	%
Corporate Payments	258.8		27	%	196.9		22	%	733.0		26	%	570.4		22	%
Lodging	141.4		15	%	126.0		14	%	400.3		14	%	337.4		13	%
Brazil	134.2		14	%	108.6		12	%	382.0		14	%	322.9		13	%
Other	71.0		7	%	66.3		7	%	184.3		7	%	188.6		7	%
Consolidated revenues, net	$	970.9	100	%	$	893.0	100	%	$	2,820.4	100	%	$	2,543.5	100	%

*Columns may not calculate due to rounding.

Revenue by geography (in millions) for the three and nine months ended September 30, was as follows:


Revenues, net by Geography*	Three Months Ended September 30,								Nine Months Ended September 30,
	2023		%		2022		%		2023		%		2022		%
United States	$	561.4	58	%	$	558.3	63	%	$	1,609.8	57	%	$	1,557.7	61	%
Brazil	134.2		14	%	108.6		12	%	382.0		14	%	322.9		13	%
United Kingdom	114.5		12	%	90.4		10	%	333.4		12	%	278.4		11	%
Other	160.8		17	%	135.8		15	%	495.2		18	%	384.5		15	%
Consolidated revenues, net	$	970.9	100	%	$	893.0	100	%	$	2,820.4	100	%	$	2,543.5	100	%


*Columns may not calculate due to rounding.

Contract Liabilities

Deferred revenue contract liabilities for customers subject to ASC 606 were $42.6 million and $57.7 million as of September 30, 2023 and December 31, 2022, respectively. We expect to recognize approximately $27.6 million of these ~~derivative contracts at inception is generally less than one year.~~ amounts in revenues within 12 months and the remaining $15.0 million over the next five years as of September 30, 2023. Revenue recognized in the nine months ended September 30, 2023 that was included in the deferred revenue contract liability as of December 31, 2022 was approximately $31.9 million.

Spot Trade Offsetting

The Company ~~aggregates~~uses spot trades to facilitate cross-currency corporate payments in its ~~foreign exchange exposures arising from customer~~cross-border payments business. The Company applies offsetting to our spot trade assets and liabilities associated with contracts ~~including forwards, options and~~that include master netting agreements, as a right of setoff exists, which the Company believes to be enforceable. As such, the Company has netted spot ~~exchanges of currency, and hedges (economic hedge)~~trade liabilities against spot trade receivables at the resulting net currency risks by entering into offsetting contracts with established financial institution counterparties. The changes in fair value related to these contracts are recorded in the Unaudited Consolidated Statements of Income.

counter-party level. The Company recognizes all ~~derivatives~~spot trade assets, net in ~~"prepaid expenses~~accounts receivable and ~~other current assets" and "other current liabilities"~~all spot trade liabilities, net in accounts payable, each net at the ~~accompanying~~customer level, in its Consolidated Balance Sheets at their fair value. ~~All cash flows associated~~The following table presents the Company’s spot trade assets and liabilities at their fair value at September 30, 2023 and December 31, 2022 (in millions):


	September 30, 2023						December 31, 2022
	Gross		Offset on the Balance Sheet		Net		Gross		Offset on the Balance Sheet		Net
Assets
Accounts Receivable	$	3,824.6	$	(3,647.4)	$	177.2	$	2,409.8	$	(2,266.0)	$	143.8
Liabilities
Accounts Payable	$	3,736.9	$	(3,647.4)	$	89.5	$	2,332.5	$	(2,266.0)	$	66.5

Reclassifications and Adjustments

Certain disclosures for prior periods have been reclassified to conform with current year presentation, including the breakout of derivatives ~~are included in cash flows from operating activities in~~assets and liabilities, net within the ~~Unaudited~~ Consolidated Statements of Cash ~~Flows.~~

~~Adoption of New Accounting Standards~~

~~Revenue Recognition~~

In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)." The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 will replace most existing revenue recognition guidance in GAAP and permits the use of either the retrospective or modified retrospective transition method. The update requires significant additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. ASU 2014-09, as amended by ASU 2015-14, "Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date," is effective for years beginning after December 15, 2017, including interim periods, with early adoption permitted for years beginning after December 15, 2016. Since the issuance of ASU 2014-09, the FASB has issued additional interpretive guidance, including new accounting standards updates, that clarifies certain points of the standard and modifies certain requirements.

~~The Company has performed a review of the requirements of the new revenue standard and is monitoring the activity of the FASB~~Flows, and the transition resource group as it relates to specific interpretive guidance. The Company established an implementation team to assess the effects of the new revenue standard in a multi-phase approach. In the first phase, the Company is analyzing customer contracts for its most significant contract categories, applied the five-step model of the new standard to each contract category and comparing the results to our current accounting practices. The second phase, which includes quantifying the potential effects identified during the first phase, assessing additional contract categories and principal versus agent considerations, revising accounting policies and considering the effects on related disclosures and/or internal control over financial reporting is ongoing as of the end of the third quarter.

The new standard could change the amount and timing of revenue and expenses to be recognized under certain of our arrangement types. In addition, it could also increase the administrative burden on our operations to account for customer contracts and provide the more expansive required disclosures. More judgment and estimates may be required within the process of applying the requirements of the new standard than are required under existing GAAP, such as identifying performance obligations in contracts, estimating the amount of variable consideration to include in transaction price, allocating transaction price to each separate performance obligation and estimating expected customer lives. The Company has not completed its assessment or quantified the effect the new guidance will have on its consolidated financial statements, related disclosures and/or its internal control over financial reporting. This assessment will occur over the remainder of the calendar year and will include evaluating the application of the principal vs. agent cost to obtain a contract guidance. However, the Company's preliminary view is that the expected amount and timing of revenue to be recognized under ASU 2014-09 for its most significant contract categories, fuel card payments, corporate payments, toll payments, lodging payments and gift cards, will be similar to the amount and timing of revenue recognized under our current accounting practices. The Company also may be required to capitalize additional costs to obtain contracts with customers, and, in some cases, may be required to amortize these costs over a contractual time period. Finally, the Company expects disclosures about its revenues and related customer acquisition costs will be more extensive.

The Company plans to adopt ASU 2014-09, as well as other clarifications and technical guidance issued by the FASB related to this new revenue standard, on January 1, 2018. The Company will apply the modified retrospective transition method, which would result in an adjustment to retained earnings for the cumulative effect, if any, of applying the standard to contracts that are not completed at the date of initial application. Under this method, the Company would not restate the prior financial statements presented, therefore the new standard requires the Company to provide additional disclosures of the amount by which each financial statement line item is affected in the current reporting period during 2018, as compared to the guidance that was in effect before the change, and an explanation of the reasons for significant changes, if any.

~~Accounting for Leases~~

In February 2016, the FASB issued ASU 2016-02, “Leases”, which requires lessees to recognize a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. This ASU also requires disclosures to provide additional information about the amounts recorded in the financial statements. This ASU is effective for the Company for annual periods beginning after December 15, 2018 and interim periods therein. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition and requires application of the new guidance for leases that exist or are entered into after the beginning of the earliest comparative period presented. The Company is currently evaluating the impact of ASU 2016-02 on our consolidated financial statements; however, we expect to recognize right of use assets and liabilities for our operating leases in the consolidated balance sheet upon adoption.

~~Accounting for Breakage~~

In March 2016, the FASB issued ASU 2016-04, “Liabilities-Extinguishments of Liabilities: Recognition of Breakage for Certain Prepaid Stored-Value Products”, which requires entities that sell prepaid stored value products redeemable for goods, services or cash at third-party merchants to derecognize liabilities related to those products for breakage. This ASU is effective for the Company for reporting periods beginning after December 15, 2017. Early adoption is permitted. The ASU must be adopted using either a modified retrospective approach with a cumulative effect adjustment to retained earnings as of the beginning of the period of adoption or a full retrospective approach. The Company’s adoption of this ASU is not expected to have a material impact on the results of operations, financial condition, or cash flows.

~~Cash Flow Classification~~

In August 2016, the FASB issued ASU 2016-15, "Classification of Certain Cash Receipts and Cash Payments", which amends the guidance in ASC 230, Statement of Cash Flows. This amended guidance reduces the diversity in practice that has resulted from the lack of consistent principles related to the classification of certain cash receipts and payments in the statement of cash flows. This ASU is effective for the Company for reporting periods beginning after December 15, 2017. Early adoption is permitted. Entities must apply the guidance retrospectively to all periods presented but may apply it prospectively from the earliest date practicable if retrospective application would be impracticable. The Company’s adoption of this ASU is not expected to have a material impact on the results of operations or financial condition.

~~In November 2016, the FASB issued ASU 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash", which amends the guidance in ASC 230, Statement of Cash Flows, on the classification and~~ presentation of restricted cash in the statement of cash flows. This ASU is effective for the Company for reporting periods beginning after December 15, 2017. Early adoption is permitted. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in this ASU should be applied using a retrospective transition methoddisaggregated revenues by solution to ~~each period presented. The Company is evaluating what impact if any the adoption of this ASU will have on the results of operations, financial condition, or cash flows.~~align with our revenues by segment presentation.

~~Intangibles - Goodwill and Other Impairment~~

In January 2017, the FASB issued ASU 2017-04, "Simplifying the Test for Goodwill Impairment, which eliminates the requirement to calculate the implied fair value of goodwill (i.e., Step 2 of the goodwill impairment test) to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on Step 1). The standard has tiered effective dates, starting in 2020 for calendar-year public business entities that meet the definition of an SEC filer. Early adoption is permitted for interim and annual goodwill impairment testing dates after January 1, 2017. The Company’s adoption of this ASU is not expected to have a material impact on the results of operations, financial condition, or cash flows, unless a goodwill impairment is identified.

~~Definition of a Business~~

In January 2017, the FASB issued ASU 2017-01, "Clarifying the Definition of a Business", which amends the definition of a business to assist entities with evaluating when a set of transferred assets and activities is a business. The guidance requires an entity to evaluate if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If so, the set of transferred assets and activities is not a business. The guidance also requires a business to include at least one substantive process and narrows the definition of outputs. The guidance is effective for the Company for reporting periods beginning after December 15, 2017, and interim periods within those years. Early adoption is permitted. The Company’s adoption of this ASU is not expected to have a material impact on the results of operations, financial condition, or cash flows, however it could result in accounting for acquisitions as asset acquisitions versus business combinations upon adoption.

~~Accounting for Modifications to Stock-Based Compensation~~

In May 2017, the FASB issued ASU 2017-09, "Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting", which amends the scope of modification accounting for share-based payment arrangements. The ASU provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC 718. Specifically, an entity would not apply modification accounting if the fair value, vesting conditions and classification of the awards are the same immediately before and after the modification. The guidance is effective for the Company for reporting periods beginning after December 15, 2017, and interim periods within those years. Early adoption is permitted. The Company's adoption of this ASU is not expected to have a material impact on the results of operations, financial condition, or cash flows.

~~Accounting for Derivative Financial Instruments~~

In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities", which amends the hedge accounting recognition and presentation requirements in ASC 815. The FASB issued accounting guidance to better align hedge accounting with a company’s risk management activities, simplify the application of hedge accounting and improve the disclosures of hedging arrangements. The guidance is effective for the Company for reporting periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted. The Company's adoption of this ASU is not expected to have a material impact on the results of operations, financial condition, or cash flows.

2. Accounts ~~Receivable~~and Other Receivables

The Company's accounts and securitized accounts receivable include the following at September 30, 2023 and December 31, 2022 (in thousands):


	September 30, 2023		December 31, 2022
Gross domestic accounts receivable	$	1,326,581	$	985,873
Gross domestic securitized accounts receivable	1,396,000		1,287,000
Gross foreign receivables	1,499,608		1,228,718


Total gross receivables	4,222,189		3,501,591
Less allowance for credit losses	(170,914)		(149,846)
Net accounts and securitized accounts receivables	$	4,051,275	$	3,351,745

The Company ~~maintains~~maintains a ~~$950 million revolving~~$1.7 billion revolving trade accounts receivable ~~Securitization Facility.~~securitization facility (as amended from time to time, the "Securitization Facility"). Accounts receivable collateralized within our Securitization Facility primarily relate to ~~our U.S.~~ trade receivables resulting from charge card ~~activity.~~activity in the U.S. Pursuant to the terms of the Securitization Facility, the Company transfers in the form of a legal sale certain of its domestic receivables, on a revolving basis, to ~~FleetCor~~FLEETCOR Funding LLC (Funding), a wholly-owned bankruptcy remote subsidiary. In turn, Funding ~~sells,~~transfers in the form of a legal sale, without recourse, on a revolving basis, ~~up to $950 million of~~an undivided percentage ownership ~~interests~~interest in this pool of accounts receivable to aunrelated transferees i.e., multi-seller banks and asset-backed commercial paper ~~conduit (Conduit).~~conduits. Funding ~~maintains~~retains a residual, subordinated interest in cash flow distribution from the transferred receivables and provides to the transferees an incremental pledge of unsold receivables as a form of over-collateralization ~~in a portion~~to enhance the credit of the ~~receivables sold to the Conduit.~~transferred receivables. Purchases by the ~~Conduit~~banks and conduits are generally financed with the sale of highly-rated commercial paper.

The Company utilizes proceeds from the ~~sale of its accounts receivable~~securitized assets as an alternative to other forms of financing to reduce its overall borrowing costs. The Company has agreed to continue servicing the sold receivables for the financial institution at market rates, which approximates the Company’s cost of servicing. ~~The Company retains a residual interest in the accounts~~

~~receivable sold as a form of credit enhancement. The residual interest’s fair value approximates carrying value due to its short-term nature.~~ Funding determines the level of funding achieved by the sale of trade accounts receivable, subject to a maximum amount.

The Company’s ~~consolidated balance sheets~~Consolidated Balance Sheets and ~~statements~~Statements of ~~income~~Income reflect the activity related to securitized accounts receivable and the corresponding securitized debt, including interest income, fees generated from late payments, provision for losses on accounts receivable and interest expense. The cash flows from borrowings and repayments associated with the securitized debt are presented as cash flows from financing activities.

~~The Company’s accounts receivable and securitized accounts receivable include the following at September 30, 2017 and December 31, 2016 (in thousands):~~

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September 30, 2017 December 31, 2016
Gross domestic accounts receivable $ 651,328
$ 529,885
Gross domestic securitized accounts receivable 794,000
591,000
Gross foreign receivables 852,706
704,630
Total gross receivables 2,298,034

1,825,515
Less allowance for doubtful accounts (47,779 ) (32,506 )
Net accounts and securitized accounts receivable $ 2,250,255

$ 1,793,009

A ~~rollforward~~roll forward of the Company’s allowance for ~~doubtful accounts~~credit losses related to accounts receivable for the nine months ended September 30, 2023 and 2022 is as follows (in thousands):


	2023		2022
Allowance for credit losses beginning of period	$	149,846	$	98,719
Provision for credit losses	103,495		89,976
Write-offs	(92,406)		(58,284)
Recoveries	8,242		5,329
Impact of foreign currency	1,737		(1,713)

Allowance for credit losses end of period	$	170,914	$	134,027

2017 2016
Allowance for doubtful accounts beginning of period $ 32,506
$ 21,903
Provision for bad debts 35,949
24,512
Write-offs (20,676 ) (16,343 )
Allowance for doubtful accounts end of period $ 47,779
$ 30,072
The provision for credit losses and write-offs increased during the nine months ended September 30, 2023, as customer spend increased due to new sales and higher fuel prices. These new customers tend to have higher loss rates. Additionally, the Company experienced higher losses among micro-SMB (small-medium business) customers who were more severely impacted by negative economic conditions.

3. Fair Value ~~Measurements~~Measurements/

Fair value is a market-based measurement that reflects assumptions that market participants would use in pricing an asset or liability. GAAP discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). These valuation techniques are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions.

~~As the basis for evaluating such inputs, a~~A three-tier value hierarchy prioritizes the inputs used in measuring fair value as follows:

•Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets.

•Level 2: Observable inputs other than quoted prices that are directly or indirectly observable for the asset or liability, including quoted prices for similar assets or liabilities in active markets; quoted prices for similar or identical assets or liabilities in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.

•Level 3: Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions. ~~The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.~~

The following table presents the Company’s financial assets and liabilities which are measured at fair ~~values~~value on a recurring basis as of September 30, ~~2017~~2023 and December 31, ~~2016,~~2022 (in thousands).:


										Fair Value		Level 1		Level 2		Level 3
	Fair Value		Level 1		Level 2		Level 3
September 30, 2017
September 30, 2023									September 30, 2023
Assets:									Assets:
Repurchase agreements	$	363,335	$	—	$	363,335	$	—	Repurchase agreements	$	207,458	$	—	$	207,458	$	—
Money market	50,341		—		50,341		—
Money market mutual funds									Money market mutual funds	154,886		—		154,886		—
Certificates of deposit	9,370		—		9,370		—		Certificates of deposit	226,541		—		226,541		—
Treasury bills									Treasury bills	184,625		—		184,625		—
Interest rate swaps									Interest rate swaps	54,125		—		54,125		—
Cross-currency interest rate swap									Cross-currency interest rate swap	6,850		—		6,850		—
Foreign exchange contracts	111,235		28		111,207		—		Foreign exchange contracts	317,084		—		317,084		—
Total assets	$	534,281	$	28	$	534,253	$	—	Total assets	$	1,151,569	$	—	$	1,151,569	$	—
Cash collateral for foreign exchange contracts	$	33,911	$	—	$	—	$	—	Cash collateral for foreign exchange contracts	$	46,100
Liabilities:									Liabilities:
Interest rate swaps									Interest rate swaps	$	6,526	$	—	6,526		—

Liabilities:
Foreign exchange contracts contracts	$	106,175	$	353	$	105,822	—
Foreign exchange contracts									Foreign exchange contracts	266,967		—		266,967		—
Total liabilities	$	106,175	$	353	$	105,822			Total liabilities	$	273,493	$	—	$	273,493	$	—
Cash collateral obligation for foreign exchange contracts	$	20,272	$	—	$	—	$	—	Cash collateral obligation for foreign exchange contracts	$	187,100

December 31, 2016
December 31, 2022									December 31, 2022
Assets:									Assets:
Repurchase agreements	$	232,131	$	—	$	232,131	$	—	Repurchase agreements	$	444,216	$	—	$	444,216	$	—
Money market	50,179		—		50,179		—
Money market mutual funds									Money market mutual funds	37,821		—		37,821		—
Certificates of deposit	48		—		48		—		Certificates of deposit	181		—		181		—
Total cash equivalents	$	282,358	$	—	$	282,358	$	—
Interest rate swaps									Interest rate swaps	11,953		—		11,953		—
Foreign exchange contracts									Foreign exchange contracts	266,917		—		266,917		—
Total assets									Total assets	$	761,088	$	—	$	761,088	$	—
Cash collateral for foreign exchange contracts									Cash collateral for foreign exchange contracts	$	56,103
Liabilities:									Liabilities:

Foreign exchange contracts									Foreign exchange contracts	224,725		—		224,725		—
Total liabilities									Total liabilities	$	224,725	$	—	$	224,725	$	—
Cash collateral obligation for foreign exchange contracts									Cash collateral obligation for foreign exchange contracts	$	148,167

The Company has highly-liquid investments classified as cash equivalents, with original maturities of 90 days or less, included in our Consolidated Balance Sheets. The Company utilizes Level 2 fair value determinations derived from directly or indirectly observable (market based) information to determine the fair value of these highly liquid investments. The Company has certain cash and cash equivalents that are invested ~~on an overnight basis~~ in highly liquid investments, such as, repurchase agreements, money markets, ~~and~~ certificates of ~~deposit.~~deposit and Treasury bills, with purchased maturities ranging from overnight to 90 days or less. The value of overnight repurchase agreements is determined based upon the quoted market prices for the ~~treasury~~ securities associated with the repurchase agreements. The value of money market instruments is determined based upon the financial institutions' month-end statement, as these instruments are not ~~tradeable~~tradable and must be settled directly by us with the respective financial institution. Certificates of deposit and certain U.S. Treasury bills are valued at cost, plus interest accrued. Given the short-term nature of these instruments, the carrying value approximates fair value. Foreign exchange derivative contracts are carried at fair value, with changes in fair value recognized in the ~~Unaudited~~ Consolidated Statements of Income. The fair value of the Company's derivatives is derived with reference to a valuation from a derivatives dealer operating in an active market, which ~~the Company accepts as~~approximates the fair value of these instruments. The fair value represents ~~what would be received and or paid by~~ the ~~Company~~net settlement if the contracts were terminated as of the reporting date. Cash collateral received for foreign exchange derivatives is recorded within customer deposits liability in our ~~Unaudited~~ Consolidated Balance Sheets at September 30, ~~2017.~~2023 and December 31, 2022. Cash collateral ~~paid~~deposited for foreign exchange derivatives is recorded within restricted cash ~~and cash equivalents~~ in our ~~Unaudited~~ Consolidated Balance Sheets at September 30, ~~2017.~~2023 and December 31, 2022.

The level within the fair value hierarchy and the measurement technique are reviewed quarterly. Transfers between levels are deemed to have occurred at the end of the quarter. There were no transfers between fair value levels during the periods presented for ~~2017~~September 30, 2023 and ~~2016.~~December 31, 2022.

Table of Contents

The Company’s assets that are measured at fair value on a nonrecurring basis ~~and~~or are evaluated with periodic testing for impairment include property, plant and equipment, investments, goodwill and other intangible assets. Estimates of the fair value of assets acquired and liabilities assumed in business combinations are generally developed using key inputs such as management’s projections of cash flows on a held-and-used basis (if applicable), discounted as appropriate, management’s projections of cash flows upon disposition and discount rates. Accordingly, these fair value measurements are in Level 3 of the fair value hierarchy.

The Company's derivatives are over-the-counter instruments with liquid markets. The Company determines the fair values of its derivatives based on quoted market prices or pricing models using current market rates. The amounts exchanged are calculated by reference to the notional amounts and by other terms of the derivatives, such as interest rates, foreign currency exchange rates, commodity rates or other financial indices. See ~~footnote~~Note 13 for ~~discussion of Masternaut's other than temporary decline in~~additional information on the fair value ~~during~~of the ~~third quarter~~Company’s derivatives.

The Company regularly evaluates the carrying value of ~~2017.~~its investments. The carrying amount of investments without readily determinable fair values was $68.0 million at September 30, 2023.

The fair value of the Company’s cash, accounts receivable, securitized accounts receivable and related facility, prepaid expenses and other current assets, accounts payable, accrued expenses, customer deposits and short-term borrowings approximate their respective carrying values due to the short-term maturities of the instruments. The carrying value of the Company’s debt obligations approximates fair value as the interest rates on the debt are variable market based interest rates that

reset on a ~~quarterly~~monthly basis. These are each Level 2 fair value measurements, except for cash, which is a Level 1 fair value measurement.

4. Stockholders' Equity

OnThe Company announced on February 4, 2016 ~~the Company's~~that its Board of Directors (the "Board") approved a stock repurchase program ~~(the~~(as updated from time to time, the "Program") ~~under which~~authorizing the Company ~~may purchase up~~ to ~~an aggregate of $500 million of~~repurchase its common stock ~~over~~from time to time until February 1, 2024. On October 25, 2022, the ~~following 18 month period. On July 27, 2017,~~Company announced the ~~Company's~~ Board ~~of Directors authorized an increase in~~increased the aggregate size of the Program by ~~an additional $250 million and an extension~~$1.0 billion to $7.1 billion. Since the beginning of the Program bythrough September 30, 2023, 28,314,820 shares have been repurchased for an ~~additional 18 months. On November 1, 2017,~~aggregate purchase price of $6.4 billion, leaving the Company ~~announced that its Board~~up to $0.7 billion of ~~Directors had authorized an increase in the size of the Program by an additional $350 million, resulting in total aggregate repurchases authorized~~remaining authorization available under the Program ~~of $1.1 billion. With the increase and giving effect to the Company's $590.1 million of previous~~for future repurchases ~~the Company may repurchase up to $510 million~~ in shares of its common ~~stock at any time prior to February 1, 2019.~~

Any stock repurchases may be made at times and in such amounts as deemed appropriate. The timing and amount of stock repurchases, if any, will depend on a variety of factors including the stock price, market conditions, corporate and regulatory requirements, and any additional constraints related to material inside information the Company may possess. Any repurchases have been and are expected to be funded by a combination of available cash flow from the business, working capital and debt.stock.

On August ~~3, 2017,~~18, 2023, as part of the Program, the Company entered an ~~Accelerated Share Repurchase~~accelerated share repurchase ("ASR") agreement ("2023 ASR Agreement") with a third-party financial institution to repurchase ~~$250~~$450 million of its common stock. Pursuant to the 2023 ASR Agreement, the Company delivered ~~$250~~$450 million in cash and received ~~1,491,647~~1,372,841 shares based on a stock price of ~~$142.46~~$262.23 on August ~~7, 2017.~~18, 2023. The 2023 ASR Agreement was completed on September ~~7, 2017,~~26, 2023, at which time the Company received ~~263,012~~293,588 additional shares based on a final weighted average per share purchase price during the repurchase period of ~~$142.48.~~$270.04.

The Company accounted for the 2023 ASR Agreement as two separate transactions: (i) as shares of reacquired common stock for the shares delivered to usthe Company upon ~~effectiveness~~execution of the ASR ~~Agreement~~agreement and (ii) as a forward contract indexed to the Company's common stock for the undelivered shares. The initial delivery of shares was included in treasury stock at cost and ~~results~~resulted in an immediate reduction of the outstanding shares used to calculate the weighted average common shares outstanding for basic and diluted earnings per share. The forward contracts indexed to ~~our~~the Company's own common stock met the criteria for equity classification, and these amounts were initially recorded in additional paid-in capital and ~~then~~ reclassified to treasury stock upon ~~completion~~settlement based on the final weighted average per share price.

5. Stock-Based Compensation

The following table summarizes the expense recognized within general and administrative expenses in the Unaudited Consolidated Statements of Income related to stock-based payments recognized in the ~~ASR agreement.~~three and nine months ended September 30, 2023 and 2022 (in thousands):

~~Since~~


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Stock options	$	4,921	$	17,434	$	18,482	$	53,558
Restricted stock	24,152		16,747		71,435		47,270
Stock-based compensation	$	29,073	$	34,181	$	89,917	$	100,828

The tax benefits recorded on stock-based compensation and upon the ~~beginning~~exercises of ~~the Program, 4,114,104 shares~~options were $28.6 million and $23.9 million for ~~an aggregate purchase price of $590.1 million have been repurchased. There were 2,854,959 shares totaling $402.4 million repurchased under the Program during~~ the nine months ended September 30, ~~2017.~~

~~5. Stock-Based Compensation~~

The Company has Stock Incentive Plans (the Plans) pursuant to which the Company’s Board of Directors may grant stock options or restricted stock to employees. The table below summarizes the expense recognized related to share-based payments recognized for the three2023 and ~~nine month periods ended September 30 (in thousands):~~2022, respectively.

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Stock options $ 16,212
$ 8,304
$ 42,254
$ 25,942
Restricted stock 8,443
9,101
26,643
24,083
Stock-based compensation $ 24,655

$ 17,405

$ 68,897

$ 50,025

~~The tax benefits recorded on stock based compensation were $36.1 million and $28.4 million for the nine month periods ended September 30, 2017 and 2016, respectively.~~

The following table summarizes the Company’s total unrecognized compensation cost related to ~~stock-based~~stock based compensation as of September 30, ~~2017~~2023 (cost in thousands):


	Unrecognized Compensation Cost		Weighted Average Period of Expense Recognition (in Years)		Unrecognized Compensation Cost		Weighted Average Period of Expense Recognition (in Years)
Stock options	$	96,594	1.52	Stock options	$	37,281	2.24
Restricted stock	12,425		0.43	Restricted stock	61,573		0.75
Total	$	109,019		Total	$	98,854

Stock Options

Stock options are granted with an exercise price estimated to be equal to the fair market value of the Company's stock on the date of grant as authorized by the Company’s Board of Directors. Options granted have vesting provisions ranging from one to five years and vesting of the options is generally based on the passage of time or performance. Stock option grants are subject to forfeiture if employment terminates prior to vesting.

The following summarizes the changes in the number of shares of common stock under option for the nine ~~month period~~months ended September 30, ~~2017 (shares~~2023 (shares/options and aggregate intrinsic value in thousands):


	Shares	Weighted Average Exercise Price		Options Exercisable at End of Period	Weighted Average Exercise Price of Exercisable Options		Weighted Average Fair Value of Options Granted During the Period		Aggregate Intrinsic Value
Outstanding at December 31, 2022	5,301	$	188.12	3,512	$	159.46			$	113,681
Granted	186	203.36					$	67.47
Exercised	(573)	171.92							$	33,922
Forfeited	(78)	241.63
Outstanding at September 30, 2023	4,836	$	189.76	3,237	$	163.45			$	324,687
Expected to vest as of September 30, 2023	749	$	222.31

Shares
Weighted
Average
Exercise
Price

Options
Exercisable
at End of
Period

Weighted
Average
Exercise
Price of
Exercisable
Options

Weighted
Average Fair
Value of
Options
Granted
During the Period

Aggregate
Intrinsic
Value
Outstanding at December 31, 2016 6,146
$ 91.20
3,429
$ 55.00
$ 309,238
Granted 2,764
144.45
$ 32.20

Exercised (388 ) 52.10
39,789
Forfeited (265 ) 142.93

Outstanding at September 30, 2017 8,257
$ 109.20
3,956
$ 71.26
$ 376,264
Expected to vest as of September 30, 2017 8,257
$ 109.20

The aggregate intrinsic value of stock options exercisable at September 30, ~~2017~~2023 was ~~$330.4~~$298.9 million. The ~~weighted~~weighted average remaining contractual term of options exercisable at September 30, ~~2017 was 5.1 years.~~

The fair value of stock option awards granted was estimated using the Black-Scholes option pricing model during the nine months ended September 30, 2017 and 2016, with the following weighted-average assumptions for grants or modifications during the period:

September 30,
2017 2016
Risk-free interest rate 1.65 % 1.09 %
Dividend yield —
—
Expected volatility 28.02 % 27.37 %
Expected life (in years) 3.4
3.4
2023 was 3.3 years.

Restricted Stock

Awards of restricted stock and restricted stock units are independent of stock option grants and are subject to forfeiture if employment terminates prior to vesting. The vesting of shares granted is generally based on the passage of time or performance, or a combination of these. Shares vesting based on the passage of time have vesting provisions of one to three years.

The following table summarizes the changes in the number of shares of restricted stock awards and restricted stock units for the nine months ended September 30, ~~2017~~2023 (shares in thousands):


	Shares	Weighted Average Grant Date Fair Value
Outstanding at December 31, 2022	435	$	237.68
Granted	441	213.36
Issued	(307)	235.55
Cancelled	(21)	232.16
Outstanding at September 30, 2023	548	$	219.52

Shares
Weighted
Average
Grant Date
Fair Value
Outstanding at December 31, 2016 379
$ 140.39
Granted 204
149.95
Vested (204 ) 136.85
Cancelled or forfeited (48 ) 153.24
Outstanding at September 30, 2017 331
$ 149.24

6. Acquisitions

~~2017~~2023 Acquisitions

~~Cambridge Global Payments~~

~~On August 9, 2017,~~In January 2023, the Company acquired ~~Cambridge,~~100% of Global Reach, a ~~leading business to business (B2B) international~~U.K.-based cross-border payments provider, for approximately ~~$584.1~~$102.9 million, net of cash. In February 2023, the Company acquired the remainder of Mina Digital Limited ("Mina"), a cloud-based electric vehicle ("EV") charging software platform. In February 2023, the Company also acquired 100% of Business Gateway AG, a European-based service, maintenance and repair technology provider. In September 2023, the Company acquired 100% of PayByPhone Technologies, Inc., the world's second largest mobile parking operator, for approximately $303.2 million, net of cash. Each of these 2023 acquisitions provide incremental geographic expansion of our products, with PayByPhone specifically intended to progress the Company's broader strategy to transform our vehicle payments business. Results from these acquisitions have been included in ~~cash,~~the Company's consolidated results from the respective date of each acquisition.

Table of Contents

The aggregate purchase price of these acquisitions was approximately $438.3 million (inclusive of the $8.5 million previously-held equity method investment in Mina), net of cash ~~acquired~~ of ~~$132.3 million and inclusive of a note payable of $23.9~~$115 million. Cambridge processes B2B cross-border payments, assisting business clients in making international payments to suppliers and employees. The purpose of this acquisition is to further expand the Company's corporate payments footprint. The Company financed the ~~acquisition~~acquisitions using a combination of ~~existing~~available cash and borrowings under its existing credit facility. ~~The results~~Any noncompete agreements signed in conjunction with these acquisitions were accounted for separately from ~~Cambridge are reported in its North America segment~~the business acquisition.

Acquisition accounting is preliminary for ~~business in~~ the ~~United States~~2023 acquisitions as the Company is still completing the valuation for goodwill, intangible assets, income taxes, working capital, and ~~Canada and within its International segment for business in all other countries outside~~contingencies. As the PayByPhone acquisition occurred near the end of the ~~United States~~third quarter of 2023, the Company preliminarily allocated the excess of the purchase price of the acquisition over the estimated assets acquired and ~~Canada, since acquisition.~~ liabilities assumed to goodwill and intangibles on a provisional basis, based on historical valuation outcomes. Further, the provisional amounts assigned to such intangibles of $150.5 million were preliminarily assigned to the customer relationship intangible asset.

The following table summarizes the preliminary acquisition accounting, in aggregate, for ~~Cambridge~~the business acquisitions noted above (in thousands):


Trade and other receivables	$	20,312
Prepaid expenses and other current assets	120,346
Other long term assets	10,506
Goodwill	372,479
Intangibles	211,117
Accounts payable and accrued expenses	(95,180)
Other current liabilities	(139,801)
Other noncurrent liabilities	(61,442)


Aggregate purchase price	$	438,337

Results from the Global Reach Group are included in the Company's Corporate Payments segment and the results for Mina Digital Limited, Business Gateway AG and PayByPhone are included in the Company's Fleet segment.

2022 Acquisitions

In March 2022, the Company completed the acquisition of Levarti, a U.S.-based airline software platform company reported in the Lodging segment, for $23.7 million, net of cash. In August 2022, the Company completed the acquisition of Accrualify, an accounts payable (AP) automation software company reported in the Corporate Payments segment, for $41.2 million, net of cash. In September 2022, the Company completed the acquisition of Plugsurfing, a European EV software and network provider reported in the Fleet segment, for $75.8 million, net of cash. In November 2022, the Company completed the acquisition of Roomex, a European workforce lodging provider serving the U.K. and German markets reported in the Lodging segment, for approximately $56.8 million, net of cash. Results from these acquisitions have been included in the Company's consolidated results from the respective date of each acquisition.

The aggregate purchase price of these 2022 acquisitions was approximately $197.6 million, net of cash. The Company financed the acquisitions using a combination of available cash and borrowings under its existing credit facility. In connection with two of these acquisitions, the Company signed noncompete agreements of $1.1 million and $1.2 million with certain parties affiliated with the respective businesses. These noncompete agreements were accounted for separately from the business acquisitions.

Acquisition accounting is preliminary for Roomex (and has been completed for Levarti, Accrualify and Plugsurfing), as the Company is still completing the valuation for goodwill, intangible assets, income taxes, working capital, and contingencies.

The following table summarizes the preliminary acquisition accounting, in aggregate, for the business acquisitions noted above (in thousands):


Trade and other receivables	$	13,349
Prepaid expenses and other current assets	4,006
Other long term assets	463
Goodwill	164,123
Intangibles	50,145
Accounts payable and accrued expenses	(20,273)
Other current liabilities	(4,960)
Other noncurrent liabilities	(9,281)


Aggregate purchase price	$	197,572

Prepaid expenses and other 79,725
Property and equipment 7,106
Other long term assets 10,025
Goodwill 436,138
Customer relationships and other identifiable intangible assets 358,168
Liabilities assumed (187,664 )
Deferred tax liabilities (119,419 )
Aggregate purchase price $ 584,079

The estimated fair value of intangible assets acquired and the related estimated useful lives consisted of the following (in thousands):


	Useful Lives (in Years)	Value
Trade Name and Trademarks	2 - Indefinite	$	4,705
Proprietary Technology	5 - 10	11,646
Lodging / Supplier Network	10 - 20	1,402
Customer Relationships	5 - 20	32,392

		$	50,145

Useful Lives (in Years) Value
Customer relationships and other identifiable intangible assets 10 $ 358,168
$ 358,168

Acquisition accounting for Cambridge is preliminary as the Company is still completing the valuation for goodwill, intangible assets, income taxes, certain acquired contingencies, derivatives and the working capital adjustment period remains open. Goodwill recorded is comprised primarily of expected synergies from combining the operations of the Company and Cambridge, as well as assembled workforce. The allocation of the goodwill to the reporting units is not yet complete.

~~Other~~

On September 26, 2017, the Company acquired a fuel card provider in Russia. The accounting for this acquisition is preliminary as the Company is still completing the valuation of goodwill, intangible assets, income taxes and evaluation of acquired contingencies. The following table summarizes the preliminary acquisition accounting for the Russian acquisition (in thousands):

Trade and other receivables $ 8,175
Prepaid expenses and other 783
Property and equipment 206
Goodwill 9,209
Other intangible assets 46,034
Liabilities assumed (11,078 )
Deferred tax liabilities (9,211 )
Aggregate purchase prices $ 44,118

~~The estimated fair value of intangible assets acquired and the related estimated useful lives consisted of the following (in thousands):~~

Useful Lives (in Years) Value
Customer relationships and other identifiable intangible assets 8 $ 46,034
$ 46,034

~~Subsequently, on October 13, 2017, the Company completed the acquisition of Creative Lodging Solutions ("CLS"), a small lodging tuck-in business.~~

~~2016 Acquisitions~~

~~STP~~

On August 31, 2016, the Company acquired all of the outstanding stock of Serviços e Tecnologia de Pagamentos S.A. (“STP”), for $1.23 billion, net of cash acquired of $40.2 million. STP is an electronic toll payments company in Brazil and provides cardless fuel payments at a number of Shell sites throughout Brazil. The purpose of this acquisition was to expand the Company's presence in the toll market in Brazil. The Company financed the acquisition using a combination of existing cash and borrowings under its existing credit facility. Results from the acquired business have been reported in the Company's international segment since the date of acquisition. The following table summarizes the acquisition accounting for STP (in thousands):

Trade and other receivables $ 243,157
Prepaid expenses and other 6,998
Deferred tax assets 20,644
Property and equipment 44,226
Other long term assets 14,280
Goodwill 663,040
Customer relationships and other identifiable intangible assets 548,682
Liabilities assumed (315,082 )
Aggregate purchase price $ 1,225,945

~~The estimated fair value of intangible assets acquired and the related estimated useful lives consisted of the following (in thousands):~~

Useful Lives (in Years) Value
Customer relationships 8.5-20 $ 348,414
Trade names and trademarks - indefinite N/A 154,851
Technology 6 45,417
$ 548,682

In connection with the STP acquisition, the Company recorded contingent liabilities aggregating $15.1 million, recorded within other noncurrent liabilities and accrued expenses in the consolidated balance sheet at the date of acquisition. A portion of these acquired liabilities have been indemnified by the respective sellers. As a result, an indemnification asset of $15.1 million was

recorded within prepaid and other current assets and other long term assets in the consolidated balance sheet. Along with the Company's acquisition of STP, the Company signed noncompete agreements with certain parties with an estimated fair value of $23.2 million.

Goodwill recognized is comprised primarily of expected synergies from combining the operations of the Company and STP, as well as assembled workforce. The goodwill and definite lived intangibles acquired with this business will be deductible for tax purposes.

~~Other~~

During 2016, the Company acquired additional fuel card portfolios in the U.S. and the United Kingdom, additional Shell fuel card markets in Europe and Travelcard in the Netherlands totaling $76.7 million, net of cash acquired of $11.1 million. The following table summarizes the acquisition accounting for these acquisitions (in thousands):

Trade and other receivables $ 27,810
Prepaid expenses and other 5,097
Property and equipment 992
Goodwill 28,540
Other intangible assets 61,823
Deferred tax asset 146
Liabilities assumed (42,550 )
Deferred tax liabilities (5,123 )
Aggregate purchase prices $ 76,735

~~The estimated fair value of intangible assets acquired and the related estimated useful lives consisted of the following (in thousands):~~

Useful Lives (in Years) Value
Customer relationships and other identifiable intangible assets 10-18 $ 61,823
$ 61,823

7. Goodwill and Other ~~Intangible Assets~~Intangibles

A summary of changes in the Company’s goodwill ~~by reportable business segment~~ is as follows (in thousands):


	December 31, 2022		Acquisitions1		Dispositions2		Acquisition Accounting Adjustments		Foreign Currency		September 30, 2023







Goodwill	$	5,201,435	$	372,479	$	(40,857)	$	3,746	$	16,743	$	5,553,546

December 31, 2016 Acquisitions Dispositions
Acquisition Accounting
Adjustments

Foreign
Currency
September 30, 2017
Segment
North America $ 2,640,409
$ 436,138
$ (92,046 ) $ —
$ 707
$ 2,985,208
International 1,554,741
9,209
—
3,751
91,650
1,659,351
$ 4,195,150

$ 445,347
$ (92,046 ) $ 3,751

$ 92,357

$ 4,644,559

~~Goodwill~~1 Reflects the recognition of preliminary goodwill related to ~~our acquisition~~acquisitions completed by the Company during the nine months ended September 30, 2023. Of this amount, $220.0 million was assigned to the Fleet segment and $152.5 million was assigned to the Corporate Payments segment.

2 Reflects goodwill derecognized in connection with the disposition of ~~Cambridge is recorded in~~ the Company's North America segment at September 30, 2017, as the acquisition accounting is preliminary. The Company is continuing to evaluate the reporting units and segments allocation related to its acquisition of Cambridge. operations in Russia. See Note 15 for additional information.

As of September 30, ~~2017~~2023 and December 31, ~~2016,~~2022, other ~~intangible assets~~intangibles consisted of the following (in thousands):

September 30, 2017 December 31, 2016

Weighted-
Avg
Useful
Lives
(Years)

Gross
Carrying
Amounts

Accumulated
Amortization

Net
Carrying
Amount

Gross
Carrying
Amounts

Accumulated
Amortization

Net
Carrying
Amount
Customer and vendor relationships 15.9 $ 2,845,048
$ (565,374 ) $ 2,279,674
$ 2,449,389
$ (458,118 ) $ 1,991,271
Trade names and trademarks—indefinite lived N/A 476,648
—
476,648
510,952
—
510,952
Trade names and trademarks—other 14.6 2,805
(2,130 ) 675
2,746
(2,021 ) 725
Software 6.0 203,643
(106,786 ) 96,857
211,331
(85,167 ) 126,164
Non-compete agreements 4.9 38,628
(16,042 ) 22,586
35,191
(11,070 ) 24,121
Total other intangibles $ 3,566,772

$ (690,332 )
$ 2,876,440

$ 3,209,609

$ (556,376 )
$ 2,653,233


		September 30, 2023						December 31, 2022
	Weighted- Avg Useful Lives (Years)	Gross Carrying Amounts		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amounts		Accumulated Amortization		Net Carrying Amount
Customer and vendor relationships	17.1	$	3,073,277	$	(1,438,677)	$	1,634,600	$	2,922,586	$	(1,332,542)	$	1,590,044
Trade names and trademarks—indefinite lived	N/A	423,340		—		423,340		419,270		—		419,270
Trade names and trademarks—other	1.9	50,447		(13,873)		36,574		47,939		(9,111)		38,828
Software	6.0	285,396		(231,227)		54,169		278,460		(216,858)		61,602
Non-compete agreements	4.2	83,822		(67,506)		16,316		80,098		(58,868)		21,230

Total other intangibles		$	3,916,282	$	(1,751,283)	$	2,164,999	$	3,748,353	$	(1,617,379)	$	2,130,974
N/A = Not Applicable

Changes in foreign exchange rates resulted in a ~~$53.8~~$5.7 million increase to the net carrying values of other ~~intangible assets~~intangibles in the nine months ended September 30, ~~2017.~~2023. Amortization expense related to intangible assets for the nine months ended September 30, ~~2017~~2023 and ~~2016~~2022 was ~~$158.9~~$169.5 million and ~~$112.5~~$163.1 million, respectively. ~~As part~~

Table of the Company's plan to exit the telematics business, on July 27, 2017, the Company sold NexTraq, a U.S. fleet telematics business, to Michelin Group, resulting in a $41.8 million reduction in the net carrying values of other intangible assets.Contents

8. Debt

The Company is party to a $6.4 billion Credit Agreement (the "Credit Agreement"), with Bank of America, N.A., as administrative agent, swing line lender and letter of credit issuer, and a syndicate of financial institutions (the "Lenders"). The Credit Agreement includes a term loan A, a term loan B, and a revolving credit facility. As noted in footnote 2, the Company is also party to the Securitization Facility.

The balances of the Company’s debt instruments ~~consist primarily of term notes, revolving lines of credit~~under the Credit Agreement and athe Securitization Facility are as follows (in thousands):


	September 30, 2023		December 31, 2022
Term Loan A note payable, net of discounts	$	2,900,963	$	2,956,053
Term Loan B note payable, net of discounts	1,844,159		1,855,891
Revolving line of credit facilities	840,011		935,000
Other obligations	1,881		2,950



Total notes payable and credit agreements	5,587,014		5,749,894
Securitization Facility	1,396,000		1,287,000
Total notes payable, credit agreements and Securitization Facility	$	6,983,014	$	7,036,894
Current portion	$	2,345,803	$	2,314,056
Long-term portion	4,637,211		4,722,838
Total notes payable, credit agreements and Securitization Facility	$	6,983,014	$	7,036,894

September 30, 2017 December 31, 2016
Term notes payable—domestic(a), net of discounts $ 3,027,472
$ 2,639,279
Revolving line of credit A Facility—domestic(a) 595,000
465,000
Revolving line of credit A Facility—foreign(a) 38,047
123,412
Revolving line of credit A Facility—swing line(a) 40,193
26,608
Other debt(c) 41,771
12,934
Total notes payable and other obligations 3,742,483

3,267,233
Securitization Facility(b) 794,000
591,000
Total notes payable, credit agreements and Securitization Facility $ 4,536,483

$ 3,858,233
Current portion $ 1,602,507
$ 1,336,506
Long-term portion 2,933,976
2,521,727
Total notes payable, credit agreements and Securitization Facility $ 4,536,483

$ 3,858,233

~~______________________~~

~~(a)~~

The Company has a Credit Agreement, which has been amended multiple times and provides for senior secured credit facilities consisting of a revolving A credit facility in the amount of $1.285 billion, a term loan A facility in the amount of $2.69 billion and a term loan B facility in the amount of $350.0 million as of September 30, 2017. The revolving credit facility consists of (a) a revolving A credit facility in the amount of $800 million, with sublimits for letters of credit and swing line loans, (b) a revolving B facility in the amount of $450 million for swing line loans and multi-currency borrowings and, (c) a revolving C facility in the amount of $35 million for multi-currency borrowings in Australian Dollars or New Zealand Dollars. On January 20, 2017, the Company entered into the second amendment to the Credit Agreement, which established a new term B loan. On August 2, 2017, the Company entered into the third amendment to the Credit Agreement, which increased the total facility by $708.7 million and extended the terms of the credit facilities. The term A and revolver maturity dates are August 2, 2022 and the term B maturity date is August 2,2024. The term A and revolver pricing remains the same and the term B pricing was reduced by 25 basis points to LIBOR plus 200 basis points. In addition, the Company pays a quarterly commitment fee at a rate per annum ranging from 0.20% to 0.40% of the daily unused portion of the credit facility. The Company has unamortized debt discounts of $6.4 million related to the term A facility, $0.7 million related to the term B facility and deferred financings costs of

~~$5.4 million at September 30, 2017. In August 2017,~~On May 3, 2023, the Company ~~expensed $3.3 million and capitalized $10.6 million of debt issuance costs associated~~entered into the thirteenth amendment to the Credit Facility. The amendment replaced LIBOR on the term B loan with the ~~refinancing~~Secured Overnight Financing Rate ("SOFR"), plus a SOFR adjustment of ~~its Credit Facility.~~0.10%.

~~(b)~~

The Company is party to a $950 million receivables purchase agreement (Securitization Facility) that was amended and restated on December 1, 2015. There is a program fee equal to one month LIBOR and the Commercial Paper Rate of 1.27% plus 0.90% and 0.85% plus 0.90% as of September 30, 2017 and December 31, 2016, respectively. The unused facility fee is payable at a rate of 0.40% per annum as of September 30, 2017 and December 31, 2016.


~~(c)~~	~~Other debt includes the long-term portion of contingent consideration and deferred payments associated with certain of our businesses.~~

The Company was in compliance with all financial and non-financial covenants under the Credit Agreement and Securitization Facility at September 30, ~~2017.~~2023.

9. Income Taxes

The ~~provision for income taxes differs from amounts computed by applying the U.S. federal~~Company's effective tax rate ~~of 35% to income before income taxes~~was 26.6% and 26.8% for the three months ended September 30, ~~2017~~2023 and ~~2016~~2022, respectively. Income tax expense is based on an estimated annual effective rate, which requires the Company to make its best estimate of annual pretax accounting income or loss before consideration of tax or benefit discretely recognized in the period in which such occur. Our effective income tax rate for the three months ended September 30, 2023 differs from the U.S. federal statutory rate due primarily to the ~~following (in thousands):~~unfavorable impact of state taxes net of federal benefits, additional taxes on undistributed foreign-sourced income, and foreign withholding taxes on interest income from intercompany notes.

2017 2016
Computed tax expense at the U.S. federal tax rate $ 114,626
35.0 % $ 59,571
35.0 %
Changes resulting from:
Foreign income tax differential (9,247 ) (2.8 )% (4,265 ) (2.5 )%
Excess tax benefits related to stock-based compensation (4,360 ) (1.3 )% (8,247 ) (4.9 )%
State taxes net of federal benefits 5,926
1.8 % 1,678
1.0 %
Foreign-sourced nontaxable income 1,558
0.5 % (6,691 ) (3.9 )%
Valuation allowance on investment loss 16,718
5.1 % 960
0.6 %
Other (542 ) (0.2 )% (2,420 ) (1.4 )%
Provision for income taxes $ 124,679
38.1 % $ 40,586
23.9 %

10. Earnings Per Share

The Company reports basic and diluted earnings per share. Basic earnings per share is computed by dividing net income attributable to shareholders of the Company by the weighted average number of common shares outstanding during the reported period. Diluted earnings per share reflect the potential dilution related to equity-based incentives using the treasury stock method. The calculation and reconciliation of basic and diluted earnings per share for the three and nine months ended September 30, 2023 and 2022 is as follows (in thousands, except per share data) ~~follows:~~:

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Net income $ 202,823
$ 129,618
$ 457,503
$ 356,961
Denominator for basic earnings per share 90,751
92,631
91,619
92,604
Dilutive securities 2,250
2,676
2,304
2,600
Denominator for diluted earnings per share 93,001

95,307

93,923
95,204
Basic earnings per share $ 2.23
$ 1.40
$ 4.99
$ 3.85
Diluted earnings per share $ 2.18
$ 1.36
$ 4.87
$ 3.75


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net income	$	271,496	$	248,885	$	726,033	$	729,008
Denominator for basic earnings per share	73,165		74,461		73,523		76,311
Dilutive securities	1,439		1,097		1,210		1,376
Denominator for diluted earnings per share	74,604		75,558		74,733		77,687
Basic earnings per share	$	3.71	$	3.34	$	9.87	$	9.55
Diluted earnings per share	$	3.64	$	3.29	$	9.72	$	9.38

Diluted earnings per share for the three ~~month periods~~months ended September 30, ~~2017~~2023 and 2022 excludes the effect of ~~3.5~~0.7 million and 2.5 million shares, respectively, of common stock that may be issued upon the exercise of employee stock options because such effect would be ~~antidilutive.~~anti-dilutive. Diluted earnings per share also excludes the effect of ~~0.3 million shares~~an immaterial amount of ~~performance based~~performance-based restricted stock for which the performance criteria have not yet been achieved for ~~both~~ the three month periods ended September 30, ~~2017~~2023 and ~~2016, respectively.~~2022.

11. Segments

The Company reports information about its operating segments in accordance with the authoritative guidance related to segments. We manage and report our operating results through four reportable segments: Fleet, Corporate Payments, Lodging and Brazil. The Company’s reportable segments represent components of the business for which separate financial information is evaluated regularly by the chief operating decision maker in determining how to allocate resources and in assessing performance. The Company operates in two reportable segments, North America and International. The Company began reporting itsremaining results from Cambridge acquired in the third quarter of 2017 in its North America segment for Cambridge's business in the United States and Canada and within its International segment for Cambridge's business in all other countries outside of the United States and Canada. The Company is continuing to evaluate the allocation of Cambridge results to its reporting units and segments. The results of operations from the fuel card business acquired in Russia are included within Other, which includes our ~~International segment, from~~Gift and Payroll Card businesses. These segments align with how the ~~date of acquisition. There were no inter-segment sales.~~Chief Operating Decision Maker (CODM) allocates resources, assesses performance and reviews financial information.

The Company’s segment results are as follows for the three and nine month periods ended September 30, 2023 and 2022 (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	20231		2022		20231		2022
Revenues, net:
Fleet	$	365,502	$	395,203	$	1,120,823	$	1,124,157
Corporate Payments	258,800		196,941		732,958		570,408
Lodging	141,389		125,961		400,287		337,438
Brazil	134,172		108,583		381,998		322,945
Other2	71,029		66,312		184,333		188,571
	$	970,892	$	893,000	$	2,820,399	$	2,543,519
Operating income:
Fleet	$	186,614	$	192,598	$	547,637	$	547,233
Corporate Payments	102,143		69,669		265,100		193,735
Lodging	74,023		63,463		196,832		161,802
Brazil	61,054		44,646		168,673		123,591
Other2	21,143		18,794		54,580		51,010
	$	444,977	$	389,170	$	1,232,822	$	1,077,371
Depreciation and amortization:
Fleet	$	34,219	$	34,897	$	104,147	$	104,531
Corporate Payments	21,114		15,864		61,458		48,936
Lodging	12,189		10,474		35,247		31,329
Brazil	14,989		13,756		45,065		41,164
Other2	2,239		2,222		6,741		6,529
	$	84,750	$	77,213	$	252,658	$	232,489

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Revenues, net:
North America $ 364,443
$ 345,868
$ 1,037,386
$ 950,542
International 213,434
138,558
602,161
366,051
$ 577,877

$ 484,426

$ 1,639,547

$ 1,316,593
Operating income:
North America $ 138,748
$ 135,760
$ 394,646
$ 367,221
International 93,889
55,295
249,102
170,957
$ 232,637

$ 191,055

$ 643,748

$ 538,178
Depreciation and amortization:
North America $ 37,600
$ 32,739
$ 104,161
$ 96,351
International 31,556
24,345
94,570
45,497
$ 69,156

$ 57,084

$ 198,731

$ 141,848
Capital expenditures:
North America $ 9,167
$ 11,980
$ 30,901
$ 28,501
International 7,692
5,140
18,558
13,376
$ 16,859

$ 17,120

$ 49,459

$ 41,877
1Results from Global Reach Group acquired in the first quarter of 2023 are reported in the Corporate Payments segment from the date of acquisition. Results from Mina Digital Limited, Business Gateway AG and PayByPhone acquired during 2023 are reported in the Fleet segment, from the date of acquisition.

2Other includes Gift and Payroll Card operating segments.

12. Commitments and Contingencies

In the ordinary course of business, the Company is involved in various pending or threatened legal actions, arbitration proceedings, claims, subpoenas, and matters relating to compliance with laws and regulations (collectively, ~~legal proceedings)~~"legal proceedings"). Based on our current knowledge, management presently does not believe that the liabilities arising from these legal proceedings will have a material adverse effect on our consolidated financial condition, results of operations or cash flows. However, it is possible that the ultimate resolution of these legal proceedings could have a material adverse effect on our results of operations and financial condition for any particular period.

~~Shareholder Class Action and~~ Derivative Lawsuits

On June 14, 2017, a shareholder filed a class action complaint in the United States District Court for the Northern District of Georgia against the Company and certain of its officers and directors on behalf of all persons who purchased or otherwise acquired the Company’s stock between February 5, 2016 and May 2, 2017. On October 13, 2017, the shareholder filed an amended complaint asserting claims on behalf of a putative class of all persons who purchased or otherwise acquired the Company's common stock between February 4, 2016 and May 3, 2017. The complaint alleges that the defendants made false or misleading statements regarding fee charges and the reasons for its earnings and growth in certain press releases and other public statements in violation of the federal securities laws. Plaintiff seeks class certification, unspecified monetary damages, costs, and attorneys’ fees. The Company disputes the allegations in the complaint and intends to vigorously defend against the claims.

On July 10, 2017, a shareholder derivative complaint was filed against the Company and certain of the Company’s directors and officers in the United States District Court for the Northern District of Georgia ("Federal Derivative Action") seeking recovery from the Company. The District Court dismissed the Federal Derivative Action on October 21, 2020, and the United States Court of Appeals for the Eleventh Circuit affirmed the dismissal on July 27, 2022, ending the lawsuit. A similar

Table of Contents

derivative lawsuit that had been filed on January 9, 2019 in the Superior Court of Gwinnett County, Georgia (“State Derivative Action”) was likewise dismissed on October 31, 2022.

and misleading public statements concerning the Company’s fee charges and financial and business ~~prospects;~~prospects, and ~~that certain defendants breached their fiduciary duties through allegedly~~making improper sales of stock. The complaint seeks ~~unspecified~~approximately $118 million in monetary damages on behalf of the Company, ~~corporate governance reforms,~~including contribution by defendants as joint tortfeasors with the Company in unfair and deceptive practices, and disgorgement of ~~profits, benefits~~incentive pay and ~~compensation by~~stock compensation. On January 24, 2023, the ~~defendants, restitution, costs,~~previous Federal Derivative Action plaintiffs filed a similar new derivative lawsuit, Jerrell Whitten, derivatively on behalf of FleetCor Technologies, Inc. v. Ronald F. Clarke and ~~attorneys’~~Eric R. Dey, against Mr. Clarke and experts’ fees. On August 18, 2017, the court entered an order deferring the case pending a ruling on the defendants' motion to dismiss the putative shareholder class action, or until otherwise agreed to by the parties.Mr. Dey in Gwinnett County, Georgia. The defendants dispute the allegations in the ~~complaint~~derivative complaints and intend to vigorously defend against the claims.

FTC Investigation

In October 2017, the Federal Trade Commission ("FTC") issued a Notice of Civil Investigative Demand to the Company for the production of documentation and a request for responses to written interrogatories. After discussions with the Company, the FTC proposed in October 2019 to resolve potential claims relating to the Company’s advertising and marketing practices, principally in its U.S. direct fuel card business within its North American Fuel Card business. The parties reached impasse primarily related to what the Company believes are unreasonable demands for redress made by the FTC. On December 20, 2019, the FTC filed a lawsuit in the Northern District of Georgia against the Company and Ron Clarke. See FTC v. FLEETCOR and Ronald F. Clarke, No. 19-cv-05727 (N.D. Ga.). The complaint alleges the Company and Clarke violated the FTC Act’s prohibitions on unfair and deceptive acts and practices. The complaint seeks among other things injunctive relief, consumer redress, and costs of suit. The Company continues to believe that the FTC’s claims are without merit. On April 17, 2021, the FTC filed a motion for summary judgment. On April 22, 2021, the United States Supreme Court held unanimously in AMG Capital Management v. FTC that the FTC does not have authority under current law to seek monetary redress by means of Section 13(b) of the FTC Act, which is the means by which the FTC has sought such redress in this case. FLEETCOR cross-moved for summary judgment regarding the FTC’s ability to seek monetary or injunctive relief on May 17, 2021. On August 13, 2021, the FTC filed a motion to stay or to voluntarily dismiss without prejudice the case pending in the Northern District of Georgia in favor of a parallel administrative action under Section 5 of the FTC Act that it filed on August 11, 2021 in the FTC’s administrative process. Apart from the jurisdiction and statutory change, the FTC’s administrative complaint makes the same factual allegations as the FTC’s original complaint filed in December 2019. The Company opposed the FTC’s motion for a stay or to voluntarily dismiss, and the court denied the FTC’s motion on February 7, 2022. In the meantime, the FTC’s administrative action is stayed. On August 9, 2022, the District Court for the Northern District of Georgia granted the FTC's motion for summary judgment as to liability for the Company and Ron Clarke, but granted the Company's motion for summary judgment as to the FTC's claim for monetary relief as to both the Company and Ron Clarke. The Company intends to appeal this decision after final judgment is issued. On October 20-21, 2022, the court held a hearing on the scope of injunctive relief. At the conclusion of the hearing, the Court did not enter either the FTC’s proposed order or the Company’s proposed order, and instead suggested that the parties enter mediation. Following mediation, both parties have filed proposed orders with the Court.

On June 8, 2023, the Court issued an Order for Permanent Injunction and Other Relief.The Company filed its notice of appeal to the United States Court of Appeals for the Eleventh Circuit on August 3, 2023. On August 17, 2023, the FTC Commission ordered that the stay of the parallel Section 5 administrative action will remain in place during the pendency of the Eleventh Circuit appeal. The Company has incurred and continues to incur legal and other fees related to this FTC complaint. Any settlement of this matter, or defense against the lawsuit, could involve costs to the Company, including legal fees, redress, penalties, and remediation expenses.

Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult and requires an extensive degree of judgment, particularly where, as here, the matters involve indeterminate claims for monetary damages and are in the stages of the proceedings where key factual and legal issues have not been resolved. For these reasons, the Company is currently unable to predict the ultimate timing or outcome of, or reasonably estimate the possible losses or a range of possible losses resulting from, the matters described above.

13. ~~Asset Dispositions~~Derivative Financial Instruments and Hedging Activities

~~Telematics Businesses~~

As part of the Company's plan to exit the telematics business, on July 27, 2017, the Company sold NexTraq, a U.S. fleet telematics business, to Michelin Group for $316 million. The Company recorded a pre-tax gain on the disposal of NexTraq of $175.0 million during the third quarter of 2017, which is net of transaction closing costs. The Company recorded tax on the gain of disposal of $65.8 million. The gain on the disposal is included in other (income) expense, net in the accompanying Unaudited Consolidated Statements of Income. NexTraq has historically been included in the Company's North America segment.

On September 30, 2017, the Company entered into an amended Masternaut investment agreement that resulted in the loss of significant influence, and the Company began accounting for the Masternaut investment by applying the cost method.

Foreign Currency Derivatives

The Company ~~regularly evaluates the carrying value of~~uses derivatives to facilitate cross-currency corporate payments by writing derivatives to customers within its investment and during the third quarter of 2017, the Company determined that the fair value of its 44% investment in Masternaut had declined as a result of the Company's loss of significant influence due to the amendment of the Masternaut investment agreement, executed September 30, 2017. As a result, the Company determined that the carrying value of its investment exceeded its fair value, and concluded that this decline in value was other than temporary.cross-border solution. The Company recorded a $44.6 million impairment loss in the Masternaut investment that includes adjustment for $31.4 million of currency losses previously recognized in accumulated other comprehensive income, in the three and nine months ended September 30, 2017, in the accompanying Unaudited Consolidated Statements of Income.

~~14. Derivative Financial Instruments~~

~~As a result of the Cambridge acquisition, the~~ Company writes derivatives, primarily foreign currency forward contracts, ~~and~~ option contracts, and swaps, mostly with small and medium size enterprises that are customers and derives a currency spread from this ~~activity, which was acquired during the third quarter of 2017.~~ activity.

Derivative transactions associated with the Company's cross-border solution include:

•Forward contracts,, which are commitments to buy or sell at a future date a currency at a contract price and will be settled in cash.

•Option contracts, which ~~gives~~give the purchaser the right, but not the obligation, to buy or sell within a specified time a currency at a contracted price that may be settled in cash.

•Swap contracts, which are commitments to settlement in cash at a future date or dates, usually on an overnight basis.

The ~~primary~~ credit risk inherent in derivative agreements represents the possibility that a loss may occur from the nonperformance of a counterparty to the agreements. Concentrations of credit and performance risk may exist with counterparties, which includes customers and banking partners, as the Company is engaged in similar activities with similar economic characteristics related to fluctuations in foreign currency rates. The Company performs a review of the credit risk of these counterparties at the inception of the contract and on an ongoing basis. The Company also monitors the concentration of its contracts with any individual counterparty against limits at the individual counterparty level. The Company anticipates that the counterparties will be able to fully satisfy their obligations under the agreements, but takes action when doubt arises about the counterparties' ability to perform. These actions may include requiring customers to post or increase collateral, and for all counterparties, if the ~~possible termination~~counterparty does not perform under the term of the ~~related contracts.~~contract, the contract may be terminated. The Company does not designate any of its foreign exchange derivatives as hedging instruments in accordance with ASC ~~815.~~

815, "Derivatives and Hedging".

The aggregate equivalent ~~United States~~U.S. dollar notional amount of foreign exchange derivative customer contracts held by the Company as of September 30, ~~2017~~2023 and December 31, 2022 (in millions) is presented in the table below. Notional amounts do not reflect the netting of offsetting trades, although these offsetting positions may result in minimal overall market risk. Aggregate derivative notional amounts can fluctuate from period to period in the normal course of business based on market conditions, levels of customer activity and other factors.following table:


				Notional
	Net Notional			September 30, 2023		December 31, 2022
Foreign exchange contracts:			Foreign exchange contracts:
Swaps	$	272.8	Swaps	$	194.3	$	160.9
Futures, forwards and spot	3,174.1
Futures and forwards			Futures and forwards	19,841.1		15,159.4
Written options	1,338.6		Written options	19,671.8		13,701.9
Purchased options	1,765.0		Purchased options	15,983.3		11,474.2
Total	$	6,550.5	Total	$	55,690.5	$	40,496.4

The majority of customer foreign exchange contracts are written in ~~major~~ currencies such as the U.S. ~~Dollar,~~dollar, Canadian ~~Dollar,~~dollar, British ~~Pound, Euro~~pound, euro and Australian ~~Dollar.~~

dollar.

The following table summarizes the fair value of derivatives reported in the ~~Unaudited~~ Consolidated Balance ~~Sheet~~Sheets as of September 30, ~~2017~~2023 and December 31, 2022 (in millions):


	September 30, 2023
	Fair Value, Gross				Fair Value, Net
	Derivative Assets		Derivative Liabilities		Derivative Assets		Derivative Liabilities
Derivatives - undesignated:
Foreign exchange contracts	$	607.7	$	557.6	$	317.1	$	267.0
Cash collateral	46.1		187.1		46.1		187.1
Total net of cash collateral	$	561.6	$	370.5	$	271.0	$	79.9


								December 31, 2022
	Derivative Assets			Derivative Liabilities				Fair Value, Gross				Fair Value, Net
	Fair Value			Fair Value				Derivative Assets		Derivative Liabilities		Derivative Assets		Derivative Liabilities
Derivatives - undesignated:							Derivatives - undesignated:
Over the counter	$	111.2		$	105.8
Exchange traded	—			0.4
Foreign exchange contracts	111.2			106.2			Foreign exchange contracts	$	582.2	$	540.0	$	266.9	$	224.7
Cash collateral	(33.9		)	(20.3		)	Cash collateral	56.1		148.2		56.1		148.2
Total net derivative assets and liabilities	$	77.3		$	85.9
Total net of cash collateral							Total net of cash collateral	$	526.1	$	391.8	$	210.8	$	76.5

The fair values of derivative assets and liabilities associated with contracts, ~~that~~which include netting ~~language~~terms that the Company believes to be enforceable, have been ~~netted to present the Company's~~recorded net ~~exposure with these counterparties. The Company recognizes all derivative assets in~~within prepaid ~~expense~~expenses and other current assets, ~~and all derivative liabilities in~~other assets, other current liabilities ~~both net at~~and other noncurrent liabilities in the Consolidated Balance Sheets. The Company receives cash from customers as collateral for trade exposures, which is recorded within cash and cash equivalents, restricted cash and customer ~~level~~deposits liability in the Consolidated Balance Sheets. The customer has the right to recall their collateral in the event exposures move in their favor, they perform on all outstanding contracts and have no outstanding amounts due to the Company, or they cease to do business with the Company. The Company has trading lines with several banks, most of which require collateral to be posted if

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certain mark-to-market (MTM) thresholds are exceeded. Cash collateral posted with banks is recorded within restricted cash and can be recalled in the event that exposures move in the Company’s favor or move below the collateral posting thresholds. The Company does not offset fair value amounts recognized for the right to reclaim cash collateral or the obligation to return cash collateral. Cash flows from the Company's foreign currency derivatives are classified as ~~right~~operating activities within the Unaudited Consolidated Statements of ~~offset exists, in its~~Cash Flows. The following table presents the fair value of the Company’s derivative assets and liabilities, as well as their classification on the accompanying Consolidated Balance Sheets, as of September 30, 2023 and December 31, 2022 (in millions):


		September 30, 2023		December 31, 2022
	Balance Sheet Classification	Fair Value

Derivative Assets	Prepaid expenses and other current assets	$	222.3	$	204.9
Derivative Assets	Other assets	$	94.8	$	62.0
Derivative Liabilities	Other current liabilities	$	188.8	$	184.1
Derivative Liabilities	Other noncurrent liabilities	$	78.2	$	40.6

Cash Flow Hedges

On January 22, 2019, the Company entered into three interest rate swap cash flow contracts (the "swap contracts"). One contract (which matured in January 2022) had a notional value of $1.0 billion, while the other two contracts (with maturity dates of January 2023 and December 2023) each had a notional value of $500 million. The objective of these swap contracts was to reduce the variability of cash flows in the previously unhedged interest payments associated with $2.0 billion of unspecified variable rate debt, the sole source of which is due to changes in the LIBOR benchmark interest rate. At inception, the Company designated these contracts as hedging instruments in accordance with ASC 815, "Derivatives and Hedging."

During January 2023, the Company entered into five receive-variable SOFR, pay-fixed interest rate swap derivative contracts with a cumulative notional U.S. dollar value of $1.5 billion as shown disaggregated in the table below.

On May 4, 2023, the Company amended the remaining LIBOR-based interest rate swap with a notional amount of $500 million from one-month term LIBOR of 2.55% to one-month term SOFR of 2.50%, without further changes to the terms of the swap. The Company applied certain expedients provided in ASU No. 2020-04, Reference Rate Reform (Topic 848), related to changes in critical terms of the hedging relationships due to reference rate reform, which allowed the change in critical terms without dedesignation of the hedging relationship.

In August 2023, the Company entered into eight additional receive-variable SOFR, pay-fixed interest rate swap derivative contracts with a cumulative notional U.S. dollar value of $2.0 billion as shown disaggregated in the table below.

As of September 30, 2023, the Company had the following outstanding interest rate swap derivatives that qualify as hedging instruments within designated cash flow hedges of variable interest rate risk (in millions):


Notional Amount	Fixed Rates	Maturity Date
$500	2.50%	12/19/2023
$250	4.01%	7/31/2025
$250	4.02%	7/31/2025
$500	3.80%	1/31/2026
$250	3.71%	7/31/2026
$250	3.72%	7/31/2026
$100	4.35%	7/31/2026
$250	4.40%	7/31/2026
$250	4.40%	7/31/2026
$400	4.33%	7/31/2026
$250	4.29%	1/31/2027
$250	4.29%	1/31/2027
$250	4.19%	7/31/2027
$250	4.19%	7/31/2027

The purpose of these contracts is to reduce the variability of cash flows in interest payments associated with the Company's unspecified variable rate debt, the sole source of which is due to changes in the SOFR benchmark interest rate. The Company has designated these derivative instruments as cash flow hedging instruments, which are expected to be highly effective at offsetting changes in cash flows of the related underlying exposure. As a result, changes in fair value of the interest rate swaps

are recorded in accumulated other comprehensive loss. For each of these swap contracts, the Company pays a fixed monthly rate and receives one month SOFR. The Company reclassified $24.6 million from accumulated other comprehensive loss resulting in a benefit to interest expense, net for the nine months ended September 30, 2023 related to these interest rate swap contracts. Cash flows related to the Company's interest rate swap derivatives are classified as operating activities within the Unaudited Consolidated Statements of Cash Flows, as such cash flows relate to hedged interest payments recorded in operating activities.

For derivatives accounted for as hedging instruments, the Company formally designates and documents, at inception, the financial instrument as a hedge of a specific underlying exposure, the risk management objective and the strategy for undertaking the hedge transaction. The Company formally assesses, both at the inception and at least quarterly thereafter, whether the financial instruments used in hedging transactions are effective at offsetting changes in cash flows of the related underlying exposures.

The following table presents the fair value of the Company’s interest rate swap contracts, as well as their ~~fair value. The gain or loss~~classification on the accompanying Consolidated Balance Sheets, as of September 30, 2023 and December 31, 2022 (in millions). See Note 3 for additional information on the fair value of the Company’s swap contracts.


		September 30, 2023		December 31, 2022
	Balance Sheet Classification	Fair Value
Derivatives designated as cash flow hedges:
Swap contracts	Prepaid expenses and other current assets	$	45.5	$	12.0
Swap contracts	Other assets	$	8.6	$	—

Swap contracts	Other noncurrent liabilities	$	(6.5)	$	—

As of September 30, 2023, the estimated net amount of the existing gains expected to be reclassified into earnings within the next 12 months is approximately $45.5 million.

Net Investment Hedge

In February 2023, the Company entered into a cross-currency interest rate swap that is designated as a net investment hedge of our investments in euro-denominated operations. This contract effectively converts $500 million of U.S. dollar equivalent to an obligation denominated in euro, and partially offsets the impact of changes in currency rates on our euro-denominated net investments. This contract also creates a positive interest differential on the U.S. dollar-denominated portion of the swap, resulting in a 1.96% interest rate savings on the USD notional.

Hedge effectiveness is tested based on changes in the fair value of the cross-currency swap due to changes in the USD/euro spot rate. The Company anticipates perfect effectiveness of the designated hedging relationship and records changes in the fair value of the cross-currency interest rate swap associated with changes in the spot rate through accumulated other comprehensive loss. Excluded components associated with the forward differential are recognized ~~immediately~~directly in earnings as interest expense, net. The Company recognized a benefit of $6.4 million in interest expense, net for the nine months ended September 30, 2023 related to these excluded components. The cross-currency interest rate swap designated as a net investment hedge is recorded in prepaid expenses and other current assets at a fair value of $6.9 million as of September 30, 2023. Upon settlement, cash flows attributable to derivatives designated as net investment hedges will be classified as investing activities in the Unaudited Consolidated Statements of Cash Flows.

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14. Accumulated Other Comprehensive Loss (AOCL)

The changes in the components of AOCL, net of tax, for the nine months ended September 30, 2023 and 2022 are as follows (in thousands):


	September 30, 2023
	Cumulative Foreign Currency Translation		Unrealized Gains (Losses) on Derivative Instruments		Total Accumulated Other Comprehensive (Loss) Income
Balance at December 31, 2022	$	(1,518,640)	$	8,990	$	(1,509,650)
Other comprehensive (loss) income before reclassifications	(16,387)		71,500		55,113
Amounts reclassified from AOCL	120,269		(24,603)		95,666
Tax effect	—		(3,063)		(3,063)
Other comprehensive income, net of tax	103,882		43,834		147,716
Balance at September 30, 2023	$	(1,414,758)	$	52,824	$	(1,361,934)


	September 30, 2022
	Cumulative Foreign Currency Translation		Unrealized (Losses) Gains on Derivative Instruments		Total Accumulated Other Comprehensive (Loss) Income
Balance at December 31, 2021	$	(1,441,505)	$	(23,111)	$	(1,464,616)
Other comprehensive (loss) income before reclassifications	(228,666)		30,084		(198,582)
Amounts reclassified from AOCL	—		13,582		13,582
Tax effect	—		(10,829)		(10,829)
Other comprehensive (loss) income, net of tax	(228,666)		32,837		(195,829)
Balance at September 30, 2022	$	(1,670,171)	$	9,726	$	(1,660,445)

Amounts reclassified that relate to foreign currency translation during the nine months ended September 30, 2023 are related to the Company's Russia business disposed of during the quarter ended September 30, 2023. See Note 15 for additional information regarding the Company's disposition of its Russia business.

15. Russia Disposition

During the second quarter of 2023, the Company signed definitive documents to sell its Russia business to a third party. At June 30, 2023, the Company concluded that the sale was not considered probable due to continued uncertainty regarding regulatory approvals and ongoing discussions regarding the nature and timing of deal completion. As such, the assets and liabilities associated with the Company's Russian business were not classified as held for sale prior to the completion of the transaction. During August 2023, the Company received the outstanding regulatory approvals, and the sale was completed on August 15, 2023.

The sale includes the entirety of the Company's operations in Russia and results in a complete exit from the Russia market. The Russia business was historically reported within the Company's Fleet segment and did not meet the criteria to be presented as discontinued operations. The Company received total proceeds, net of cash disposed and net of a $5.6 million foreign exchange loss upon conversion of the ruble-denominated proceeds to U.S. dollars, of $197.0 million, which have been recorded within investing activities in the accompanying Unaudited Consolidated Statements of Cash Flows. In connection with the sale, the Company recorded a net gain on disposal of approximately $13.7 million during the third quarter of 2023, which represents the proceeds received less the derecognition of the related net assets, the reclassification of accumulated foreign currency translation losses, and the foreign exchange loss upon conversion of the ruble-denominated proceeds to U.S. dollars. The net gain is included within other (income) expense, net in the accompanying Unaudited Consolidated Statements of ~~Income. At~~Income for the three and nine months ended September 30, ~~2017, $150.7~~2023.

The business in Russia accounted for approximately $62.0 million ~~derivative~~and $59.1 million of the Company's consolidated income before income taxes for the nine months ended September 30, 2023 and 2022, respectively. The Company's assets ~~and $70.9 million derivative liabilities~~in Russia were ~~recorded in the Consolidated Balance Sheet.~~

approximately 3.2% of consolidated assets at December 31, 2022.



Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited consolidated financial statements and related notes appearing elsewhere in this report. In addition to historical information, this discussion contains forward-looking statements that involve risks, uncertainties and assumptions that could cause actual results to differ materially from management’s expectations. ~~See “Special Cautionary Notice Regarding Forward-Looking Statements”.~~Factors that could cause such differences include, but are not limited to, those identified below and those described in Item 1A "Risk Factors" appearing in our Annual Report on Form 10-K for the year ended December 31, 2022 and in Part II, Item 1A "Risk Factors" of this Quarterly Report on Form 10-Q. All foreign currency amounts that have been converted into U.S. dollars in this discussion are based on the exchange rate as reported by ~~OANDA~~Oanda for the applicable periods.

~~This management’s~~The following discussion and analysis ~~should~~of our financial condition and results of operations generally discusses the three and nine months ended September 30, 2023 and 2022, with period-over-period comparisons between these periods. A detailed discussion of 2022 items and period-over-period comparisons between the three and nine months ended September 30, 2022 and 2021 that are not included in this Quarterly Report on Form 10-Q can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part I, Item 2 of our Quarterly Report on Form 10-Q for the quarter ended September 30, 2022.

Executive Overview

FLEETCOR trades on the New York Stock Exchange under the ticker FLT. FLEETCOR is a leading global business payments company that helps businesses spend less by enabling them to better manage their expense-related purchasing and vendor payments processes. FLEETCOR’s smarter payment and spend management solutions are delivered in a variety of ways depending on the needs of the customer. From physical payment cards to software that includes customizable controls and robust payment capabilities, we provide businesses with a better way to pay.

Businesses spend an estimated $135 trillion each year in transactions with other businesses. In many instances, businesses lack the proper tools to monitor what is being purchased, and employ manual, paper-based, disparate processes and methods to both approve and make payments for their business-to-business purchases. This often results in wasted time and money due to unnecessary or unauthorized spending, fraud, receipt collection, data input and consolidation, report generation, reimbursement processing, account reconciliations, employee disciplinary actions, and more.

FLEETCOR’s vision is that every payment is digital, every purchase is controlled, and every related decision is informed. Digital payments are faster and more secure than paper-based methods such as checks, and provide timely and detailed data that can be utilized to effectively reduce unauthorized purchases and fraud, automate data entry and reporting, and eliminate reimbursement processes. Combining this payment data with analytical tools delivers powerful insights, which managers can use to better run their businesses. Our wide range of modern, digitized solutions generally provides control, reporting, and automation benefits superior to many of the payment methods businesses often use such as cash, paper checks, general purpose credit cards, as well as employee pay and reclaim processes.

Impact of Russia's Invasion of Ukraine and Other Geo-Political Events on Our Business

The current military conflicts between Russia and Ukraine, as well as within the Middle East continue to create substantial uncertainty about the global economy in the future. Although the length, impact and outcome of the ongoing military conflicts between Russia and Ukraine and within the Middle East is highly unpredictable, these conflicts could lead to significant market and other disruptions. We have recently exited the Russia market via the disposition of our Russia business, which closed in the third quarter of 2023 (see "Russia Disposition" section below). Additionally, we do not have operations in Israel or Gaza. However, the escalation or continuation of these conflicts presents heightened risks and has resulted and could continue to result in volatile commodity markets, supply chain disruptions, increased risk of cyber incidents or other disruptions to information systems, heightened risks to employee safety, limitations on access to credit markets, increased operating costs (including fuel and other input costs), the frequency and volume of failures to settle securities transactions, inflation, potential for increased volatility in commodity, currency and other financial markets, and safety risks. We cannot predict how and the extent to which the conflicts will affect our customers, operations or business partners or the demand for our products and our global business. Depending on the actions we take or are required to take, the ongoing conflicts could also result in loss of cash, assets or impairment charges. Additionally, we may also face negative publicity and reputational risk based on the actions we take or are required to take as a result of these conflicts, which could damage our brand image or corporate reputation.

The extent of the impact of these tragic events on our business remains uncertain and will continue to depend on numerous evolving factors that we are not able to accurately predict, including the extent, severity, duration and outcome of the conflicts. We are actively monitoring the situations and assessing the impact on our business, and are continuing to refine our business continuity plan, which includes crisis response materials designed to mitigate the impact of disruptions to our business. Further, there can be ~~read~~no assurance that our plan will successfully mitigate all disruptions. To date we have not experienced any material interruptions in ~~conjunction~~our infrastructure, technology systems or networks needed to support our operations. The extent, severity,

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duration and outcome of the military conflicts, sanctions and resulting market disruptions could be significant and could potentially have substantial impact on the global economy and our business for an unknown period of time. Any such disruptions may also magnify the impact of other risks described herein and in our Annual Report on Form 10-K.

Russia Disposition

During the second quarter of 2023, we signed definitive documents to sell our Russia business to a third party. At June 30, 2023, we concluded that the sale was not considered probable due to continued uncertainty regarding regulatory approvals and ongoing discussions regarding the nature and timing of deal completion. As such, the assets and liabilities associated with our Russian business were not classified as held for sale prior to the completion of the transaction. During August 2023, we received the outstanding regulatory approvals, and the sale was completed on August 15, 2023.

The sale includes the entirety of our operations in Russia and results in a complete exit from the Russia market. The Russia business was historically reported within our Fleet segment and did not meet the criteria to be presented as discontinued operations. We received total proceeds, net of cash disposed and net of a $5.6 million foreign exchange loss upon conversion of the ruble-denominated proceeds to U.S. dollars, of $197.0 million, which have been recorded within investing activities in the accompanying Unaudited Consolidated Statements of Cash Flows. In connection with the ~~management’s discussion~~sale, we recorded a net gain on disposal of approximately $13.7 million during the third quarter of 2023, which represents the proceeds received less the derecognition of the related net assets, the reclassification of accumulated foreign currency translation losses and ~~analysis~~the foreign exchange loss upon conversion of the ruble-denominated proceeds to U.S. dollars. The net gain is included within other (income) expense, net in the accompanying Unaudited Consolidated Statements of Income for the three months ended September 30, 2023.

Our business in Russia accounted for approximately $62.0 million and $59.1 million of our consolidated income before income taxes for the nine months ended September 30, 2023 and 2022, respectively. Our assets in Russia were approximately 3.2% of our consolidated assets at December 31, 2022.

Impact of Recent Bank Failures

Recent failures of several financial ~~statements~~institutions have created uncertainty in the global financial markets and ~~related notes included~~a greater focus on the potential failure of other banks in the future. Although we did not experience losses as a result of these failures, we regularly maintain cash balances with financial institutions in excess of the Federal Deposit Insurance Corporation insurance limit or the equivalent outside the U.S. A disruption in financial markets could impair our banking partners, which could affect our ability to access our cash or cash equivalents; our ability to provide services to our customers; and our customers' ability to access their cash to fulfill their payment obligations to us, their vendors, and other third parties. The occurrence of these events could negatively affect our business, financial condition and results of operations.

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2022.

~~General Business~~Results

Fleetcor is a leading global provider of commercial payment solutions. We primarily go to market with our fuel card payments product solutions, corporate payments products, toll products, lodging cards and gift cards. Our products are used in 53 countries around the world, with our primary geographies in the U.S., Brazil and the U.K., which accounted for approximately 92% of our revenue in 2016. Our core products are primarily sold to businesses, retailers, major oil companies and marketers and government entities. Our payment programs enable our customers to better manage and control their commercial payments, card programs, and employee spending and provide card-accepting merchants with a high volume customer base that can increase their sales and customer loyalty. We also provide a suite of fleet related and workforce payment solution products, including mobile telematics services, fleet maintenance management and employee benefit and transportation related payments. In 2016, we processed approximately 2.2 billion transactions on our proprietary networks and third-party networks (which includes approximately 1.3 billion transactions related to our SVS product, acquired with Comdata). We believe that our size and scale, geographic reach, advanced technology and our expansive suite of products, services, brands and proprietary networks contribute to our leading industry position.

We provide our payment products and services in a variety of combinations to create customized payment solutions for our customers and partners. We collectively refer to our suite of product offerings as workforce productivity enhancement products for commercial businesses. We sell a range of customized fleet and lodging payment programs directly and indirectly to our customers through partners, such as major oil companies, leasing companies and petroleum marketers. We refer to these major oil companies, leasing companies, petroleum marketers, value-added resellers (VARs) and other referral partners with whom we have strategic relationships as our “partners.” We provide our customers with various card products that typically function like a charge card to purchase fuel, lodging, food, toll, transportation and related products and services at participating locations. While we refer to companies with whom we have strategic relationships as "partners", our legal relationships with these companies are contractual, and do not constitute legal partnerships.

We support our products with specialized issuing, processing and information services that enable us to manage card accounts, facilitate the routing, authorization, clearing and settlement of transactions, and provide value-added functionality and data, including customizable card-level controls and productivity analysis tools. In order to deliver our payment programs and services and process transactions, we own and operate proprietary “closed-loop” networks through which we electronically connect to merchants and capture, analyze and report customized information in North America and internationally. We also use third-party networks to deliver our payment programs and services in order to broaden our card acceptance and use. To support our payment products, we also provide a range of services, such as issuing and processing, as well as specialized information services that provide our customers with value-added functionality and data. Our customers can use this data to track important business productivity metrics, combat fraud and employee misuse, streamline expense administration and lower overall workforce and fleet operating costs. Depending on our customers’ and partners’ needs, we provide these services in a variety of outsourced solutions ranging from a comprehensive “end-to-end” solution (encompassing issuing, processing and network services) to limited back office processing services.

~~Executive Overview~~

We operate in two segments, which we refer to as our North America and International segments. Our revenue is reported net of the wholesale cost for underlying products and services. In this report, we refer to this net revenue as “revenue.” See “Results of Operations” for additional segment information. We report our results from Cambridge acquired in the third quarter of 2017 in our North America segment for Cambridge's business in the United States and Canada and within our International segment for Cambridge's business in all other countries outside of the United States and Canada. We are continuing to evaluate the

allocation of Cambridge results to our reporting units and segments. As part of our plan to exit the telematics business, on July 27, 2017, we sold NexTraq, a U.S. fleet telematics business, which has historically been included in our North America segment.

~~For the three and nine months ended September 30, 2017 and 2016, our North America and International segments generated the following revenue (in millions):~~

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
(Unaudited) Revenues, net % of
total
revenues, net Revenues, net % of
total
revenues, net Revenues, net % of
total
revenues, net Revenues, net % of
total
revenues, net
North America $ 364.4
63.1 % $ 345.9
71.4 % $ 1,037.4
63.3 % $ 950.5
72.2 %
International 213.4
36.9 % 138.6
28.6 % 602.2
36.7 % 366.1
27.8 %
$ 577.9
100.0 % $ 484.4
100.0 % $ 1,639.5
100.0 % $ 1,316.6
100.0 %

Revenues, net, Net Income and Net Income Per Diluted Share. Set forth below are revenues, net, net income and net income per diluted share for the three and nine months ended September 30, ~~2017~~2023 and ~~2016~~2022, (in ~~thousands,~~millions, except per share amounts).


	Three Months Ended September 30,				Nine Months Ended September 30,
(Unaudited)	2023		2022		2023		2022
Revenues, net	$	970.9	$	893.0	$	2,820.4	$	2,543.5
Net income	$	271.5	$	248.9	$	726.0	$	729.0
Net income per diluted share	$	3.64	$	3.29	$	9.72	$	9.38

Three Months Ended September 30, Nine Months Ended September 30,
(Unaudited) 2017 2016 2017 2016
Revenues, net $ 577,877
$ 484,426
$ 1,639,547
$ 1,316,593
Net income $ 202,823
$ 129,618
$ 457,503
$ 356,961
Net income per diluted share $ 2.18
$ 1.36
$ 4.87
$ 3.75

~~Adjusted Revenues,~~ Adjusted Net Income, ~~and~~ Adjusted Net Income Per Diluted ~~Share.~~Share, EBITDA and EBITDA margin. Set forth below are adjusted ~~revenues, adjusted~~ net income, ~~and~~ adjusted net income per diluted share, EBITDA and EBITDA margin for the three and nine months ended September 30, ~~2017~~2023 and ~~2016~~2022 (in ~~thousands,~~millions, except per share amounts).


	Three Months Ended September 30,						Nine Months Ended September 30,
(Unaudited)	2023			2022			2023			2022
Adjusted net income	$	335.1		$	320.7		$	932.5		$	936.5
Adjusted net income per diluted share	$	4.49		$	4.24		$	12.48		$	12.06
EBITDA	$	528.9		$	466.4		$	1,486.1		$	1,309.9
EBITDA margin	54.5		%	52.2		%	52.7		%	51.5		%

Three Months Ended September 30, Nine Months Ended September 30,
(Unaudited) 2017 2016 2017 2016
Adjusted revenues $ 550,190
$ 456,212
$ 1,556,857
$ 1,237,838
Adjusted net income $ 202,769
$ 183,310
$ 574,795
$ 478,959
Adjusted net income per diluted share $ 2.18
$ 1.92
$ 6.12
$ 5.03

~~We use~~Adjusted net income, adjusted ~~revenues as~~net income per diluted share, EBITDA and EBITDA margin are supplemental non-GAAP financial measures of operating performance. See the heading entitled "Management’s Use of Non-GAAP Financial Measures" for more information and a ~~basis to evaluate our revenues, net~~reconciliation of the ~~commissions that are paid~~non-GAAP financial measure to ~~merchants that participate~~the most directly comparable financial measure calculated in certain of our card programs. The commissions paid to merchants can vary when market spreads fluctuate in much the same way as revenues are impacted when market spreads fluctuate. Thus, we believe this is an effective way to evaluate our revenue performance on a consistent basis.accordance with GAAP. We use adjusted net income, ~~and~~ adjusted net income per diluted share, EBITDA and EBITDA margin to eliminate the effect of items that we do not consider indicative of our core operating performance on a consistent basis. ~~Adjusted revenues, adjusted net income~~These non-GAAP measures are presented solely to permit investors to more fully understand how our management assesses underlying performance and ~~adjusted net income per diluted share~~ are ~~supplemental non-GAAP~~not, and should not be viewed as, a substitute for GAAP measures, and should be viewed in conjunction with our GAAP financial ~~measures of operating performance. See the heading entitled “Management’s Use of Non-GAAP Financial Measures.”~~measures.

Sources of Revenue

~~Transactions.~~ ~~In both~~FLEETCOR offers a variety of business payment solutions that help to simplify, automate, secure, digitize and effectively control the way businesses manage and pay their expenses. We provide our ~~segments,~~payment solutions to our business, merchant, consumer and payment network customers in more than 150 countries around the world today, although we ~~derive revenue from transactions. As illustrated~~operate primarily in three geographies, with 83% of our revenues generated in the ~~diagram below, a transaction is defined as a purchase by a customer.~~U.S., Brazil, and the U.K. Our customers may include ~~holders of our card products~~commercial businesses (obtained through direct and ~~those of our~~indirect channels), partners for whom we manage ~~card~~payment programs, ~~members~~as well as individual consumers.

We report information about our operating segments in accordance with the authoritative guidance related to segments. We manage and report our operating results through four reportable segments: Fleet, Corporate Payments, Lodging, and Brazil. The remaining results are included within Other, which includes our Gift and Payroll Card businesses. These segments align with how the Chief Operating Decision Maker (CODM) allocates resources, assesses performance and reviews financial information.

Our revenue is generally reported net of ~~our proprietary networks who are provided access to our~~the cost for underlying products and services purchased. In this report, we refer to this net revenue as “revenue" or "revenues, net." See “Results of Operations” for additional segment information.

Revenues, net, by Segment. For the three and ~~commercial businesses~~nine months ended September 30, 2023 and 2022, our segments generated the following revenue (in millions).


	Three Months Ended September 30,								Nine Months Ended September 30,
	2023				2022				2023				2022
(Unaudited)*	Revenues, net		% of Total Revenues, net		Revenues, net		% of Total Revenues, net		Revenues, net		% of Total Revenues, net		Revenues, net		% of Total Revenues, net
Fleet	$	365.5	38	%	$	395.2	44	%	$	1,120.8	40	%	$	1,124.2	44	%
Corporate Payments	258.8		27	%	196.9		22	%	733.0		26	%	570.4		22	%
Lodging	141.4		15	%	126.0		14	%	400.3		14	%	337.4		13	%
Brazil	134.2		14	%	108.6		12	%	382.0		14	%	322.9		13	%
Other	71.0		7	%	66.3		7	%	184.3		7	%	188.6		7	%
Consolidated revenues, net	$	970.9	100	%	$	893.0	100	%	$	2,820.4	100	%	$	2,543.5	100	%

*Columns may not calculate due to ~~whom we provide workforce payment productivity solutions. Revenue from transactions is derived from~~rounding. Other includes our ~~merchant~~Gift and network relationships, as well as our customers and partners. Through our merchant and network relationships we primarily offer fuel cards, corporate cards, virtual cards, purchasing cards, T&E cards, gift cards, stored value payroll cards, vehicle maintenance, food, fuel, toll and transportation cards and vouchers and lodging services to our customers.

The following diagram illustrates a typical transaction flow, for our fuel card, vehicle maintenance, lodging and food, toll and transportation card and voucher products. This illustration is not applicable to all of ourPayroll Card businesses.

~~Illustrative Transaction Flow~~Segment and solutions reporting have converged to be the same. The Fuel solution is now included with the Fleet segment, with the exception of Brazil fuel, which is included in the Brazil segment. Vehicle maintenance, telematics, and Mexico benefits were included in the Other solution category previously, and are now included in the Fleet segment. The Brazil segment includes Brazil benefits from the Other solution category and the Tolls solution category. The Gift and Payroll Card solution categories are now included in Other.

~~From~~We generate revenue in our ~~customers and partners, we derive revenue from~~Fleet segment through a variety of program fees, including transaction fees, card fees, network fees and charges, ~~which can~~as well as from interchange. These fees may be charged as fixed ~~fees, cost~~amounts, costs plus a mark-up, or based on a percentage ~~discount from retail prices.~~of the transaction purchase amounts, or a combination thereof. Our programs also include other fees and charges associated with late payments and based on customer credit risk.

~~From~~In our ~~merchant and network relationships,~~Corporate Payments segment, we ~~derive~~primarily earn revenue ~~mostly~~ from the difference between the ~~price~~amount charged to athe customer ~~for a transaction~~ and the ~~price~~amount paid to the ~~merchant~~third party for a given transaction, as interchange or spread revenue. Our programs may also charge fixed fees for access to the network and ancillary services provided. In our cross-border payments business, the majority of revenue is from exchanges of currency at spot rates, which enables customers to make cross-currency payments. Our performance obligation in our foreign exchange payment services is providing a foreign currency payment to a customer’s

Table of Contents

designated recipient and therefore, we recognize revenue on foreign exchange payment services when the underlying payment is made. Revenues from foreign exchange payment services are primarily comprised of the difference between the exchange rate we set for the ~~same transaction, as well as network fees~~customer and ~~charges in certain businesses. As illustrated~~the rate available in the ~~table below,~~wholesale foreign exchange market.

In our Lodging segment, we primarily earn revenue from the ~~price~~difference between the amount charged to the customer and the amount paid to the hotel for a given transaction and commissions paid by hotels. We may also charge fees for access to the network and ancillary services provided.

In our Brazil segment, we primarily earn revenue from fixed fees for access to the network and ancillary services provided. We also earn interchange and merchant ~~or network may be calculated as (i)~~discounts on certain non-toll products. The primary measure of volume is average monthly tags active during the ~~merchant’s wholesale cost of the product plus a markup; (ii) the transaction purchase price less a percentage discount; or (iii) the transaction purchase price less a fixed fee per unit.~~period.

The ~~following table presents an illustrative~~remaining revenues represent other solutions in our Gift and Payroll card businesses. In these businesses, we primarily earn revenue ~~model for transactions with~~from the ~~merchant, which is primarily applicable to fuel based product transactions, but~~processing of transactions. We may also ~~be applied to our vehicle maintenance, lodging and food, fuel, toll and transportation card and voucher products, substituting transactions~~charge fixed fees for ~~gallons. This representative model may not include all of our businesses.~~ancillary services provided.

~~Illustrative~~ Revenues, net by Geography. Revenue ~~Model for Fuel Purchases~~

~~(unit of one gallon)~~

Merchant Payment Methods
Retail Price $ 3.00
i) Cost Plus Mark-up: ii) Percentage Discount: iii) Fixed Fee:
Wholesale Cost (2.86 ) Wholesale Cost $ 2.86
Retail Price $ 3.00
Retail Price $ 3.00
Mark-up 0.05
Discount (3%) (0.09 ) Fixed Fee (0.09 )
FleetCor Revenue $ 0.14

Merchant Commission $ (0.05 ) Price Paid to Merchant $ 2.91
Price Paid to Merchant $ 2.91
Price Paid to Merchant $ 2.91
Price Paid to Merchant $ 2.91

~~Revenues~~ by geography ~~product and source.~~ ~~Set forth below are further breakdowns of revenue by geography, product and source~~ for the three and nine months ended September 30, ~~2017~~2023 and ~~2016~~2022, was as follows (in millions).

Three Months Ended September 30, Nine Months Ended September 30,
Revenue by Geography* 2017
2016 2017 2016
(Unaudited) Revenues, net
% of
total
revenues, net
Revenues, net
% of
total
revenues, net
Revenues, net % of
total
revenues, net Revenues, net % of
total
revenues, net
United States $ 358
62 % $ 346
71 % $ 1,031
63 % $ 951
72 %
United Kingdom 61
11 % 56
12 % 174
11 % 175
13 %
Brazil 101
17 % 43
9 % 287
17 % 78
6 %
Other 58
10 % 40
8 % 148
9 % 113
9 %
Consolidated revenues, net $ 578
100 % $ 484
100 % $ 1,640
100 % $ 1,317
100 %


	Three Months Ended September 30,								Nine Months Ended September 30,
(Unaudited)	2023				2022				2023				2022
Revenues, net by Geography*	Revenues, net		% of Total Revenues, net		Revenues, net		% of Total Revenues, net		Revenues, net		% of Total Revenues, net		Revenues, net		% of Total Revenues, net
United States	$	561.4	58	%	$	558.3	63	%	$	1,609.8	57	%	$	1,557.7	61	%
Brazil	134.2		14	%	108.6		12	%	382.0		14	%	322.9		13	%
United Kingdom	114.5		12	%	90.4		10	%	333.4		12	%	278.4		11	%
Other	160.8		17	%	135.8		15	%	495.2		18	%	384.5		15	%
Consolidated revenues, net	$	970.9	100	%	$	893.0	100	%	$	2,820.4	100	%	$	2,543.5	100	%

^*Columns may not calculate due to ~~impact of~~ rounding.

Subsequent to 2016, as we continued to refine the level of detail behind the product category splits, we reclassified certain amounts into "Other" that we believe are more representative of that category. This reclassification has been applied to the 2016 and 2017 comparable data disclosed in the "Revenue by Product Category" table below.

Three Months Ended September 30,
Nine Months Ended September 30,⁸
Revenue by Product Category* 2017 2016 2017 2016
(Unaudited)
Revenues,
net
% of total revenues, net
Revenues,
net

% of total
revenues, net

Revenues,
net

% of
total
revenues, net
Revenues,
net % of total
revenues, net
Fuel cards $ 276
48 % $ 259
53 % $ 815
50 % $ 741
56 %
Corporate Payments 72
12 % 46
10 % 169
10 % 132
10 %
Tolls 83
14 % 26
5 % 236
14 % 30
2 %
Lodging 33
6 % 28
6 % 86
5 % 74
6 %
Gift 55
9 % 58
12 % 144
9 % 138
10 %
Other 59
10 % 67
14 % 189
12 % 201
15 %
Consolidated revenues, net $ 578
100 % $ 484
100 % $ 1,640
100 % $ 1,317
100 %

^*~~Columns may not calculate due to impact of rounding.~~

Three Months Ended September 30,
Nine Months Ended September 30,⁸
Major Sources of Revenue* 2017 2016 2017 2016
(Unaudited)
Revenues,
net

% of total
revenues, net

Revenues,
net

% of total
revenues, net

Revenues,
net

% of total
revenues, net

Revenues,
net

% of total
revenues, net
Customer
Processing and program revenue¹
$ 288
50 % $ 218
45 % $ 781
48 % $ 563
43 %
Late fees and finance charges²
34
6 % 31
6 % 105
6 % 86
7 %
Miscellaneous fees³
32
5 % 34
7 % 97
6 % 93
7 %
354
61 % 283
58 % 983
60 % 742
56 %
Merchant

Discount revenue (fuel)⁴
77
13 % 68
14 % 223
14 % 194
15 %
Discount revenue (nonfuel)⁵
45
8 % 40
8 % 130
8 % 116
9 %
Tied to fuel-price spreads⁶
53
9 % 53
11 % 165
10 % 145
11 %
Program revenue⁷
49
8 % 41
8 % 139
8 % 119
9 %
224
39 % 202
42 % 657
40 % 574
44 %
Consolidated revenues, net $ 578
100 % $ 484
100 % $ 1,640
100 % $ 1,317
100 %

¹~~Includes revenue from customers based on accounts, cards, devices, transactions, load amounts and/or purchase amounts, etc. for participation in our various fleet~~Organic Revenues, net by Segment and KPI. The following table presents organic revenue growth by segment and workforce related programs; as well as, revenue from partners (e.g., major retailers, leasing companies, oil companies, petroleum marketers, etc.) for processing and network management services. Primarily represents revenue from North American trucking, lodging, prepaid benefits, telematics, gifts cards and toll related businesses.

²~~Fees for late payment and interest charges for carrying a balance charged to a customer.~~

³Non-standard fees charged to customers based on customer behavior or optional participation, primarily including high credit risk surcharges, over credit limit charges, minimum processing fees, printing and mailing fees, environmental fees, etc.

⁴~~Interchange revenue directly influenced by the absolute price of fuel and other interchange related to fuel products.~~

⁵~~Interchange revenue related to nonfuel products.~~

⁶~~Revenue derived from the difference between the price charged to a fleet customer for a transaction and the price paid to the merchant for the same transaction.~~

⁷~~Revenue derived primarily from the sale of equipment, software and related maintenance to merchants.~~

⁸Amounts shown for the nine months ended September 30, 2017 and 2016 reflect immaterial corrections in estimated allocation of revenue by product and sources of revenue from previously disclosed amounts for the prior period.

*We may not be able to precisely calculate revenue by source, as certain estimates were made in these allocations. Columns may not calculate due to impact of rounding. This table reflects how management views the sources of revenue and may not be consistent with prior disclosure.

~~Revenue~~ per ~~transaction.~~ ~~Set forth below is revenue per transaction information for the three and nine months ended September 30, 2017 and 2016:~~

Three Months Ended September 30, Nine Months Ended September 30,
(Unaudited) 2017 2016 2017 2016
Transactions (in millions)
North America 398.4
370.1
1,301.1
1,214.3
International 280.7
127.4
823.0
233.3
Total transactions 679.1

497.5

2,124.1

1,447.6
Revenue per transaction

North America $ 0.91
$ 0.93
$ 0.80
$ 0.78
International 0.76
1.09
0.73
1.57
Consolidated revenue per transaction 0.85
0.97
0.77
0.91

For the three months ended September 30, 2017, total transactions increased from 497.5 million to 679.1 million, an increase of 181.6 million transactions, or 37%. For the nine months ended September 30, 2017, total transactions increased from 1,447.6 million to 2,124.1 million, an increase of 676.4 million transactions, or 47%. North American segment transactions increased approximately 8% and 7% in the three and nine months ended September 30, 2017 as compared to 2016, respectively, due primarily to growth in our SVS and fuel card businesses. Transaction volumes in our international segment increased by 120% and 253% in the three and nine months ended September 30, 2017 as compared to 2016, respectively, primarily due to the acquisition of STP and Travelcard during the third quarter of 2016.

~~Set forth below is further breakdown of revenue and revenue per transaction, by product category~~key performance metric for the three months ended September 30, ~~2017~~2023 and ~~2016~~2022 (in millions except revenues, net per ~~transaction)~~key performance metric).*:


	As Reported								Pro Forma and Macro Adjusted2
	Three Months Ended September 30,								Three Months Ended September 30,
(Unaudited)	2023		2022		Change		% Change		2023		2022		Change		% Change
FLEET
'- Revenues, net	$365.5		$395.2		(29.7)		(8)	%	$396.7		$381.1		$15.6		4	%
'- Transactions	122.0		123.4		(1.4)		(1)	%	122.0		124.1		(2.1)		(2)	%
'- Revenues, net per transaction	$2.99		$3.20		$(0.21)		(6)	%	$3.25		$3.07		$0.18		6	%
CORPORATE PAYMENTS
'- Revenues, net	$258.8		$196.9		$61.9		31	%	$256.8		$213.7		$43.1		20	%
'- Spend volume	39,446		30,609		8,837		29	%	39,446		32,828		6,618		20	%
'- Revenue, net per spend $	0.66	%	0.64	%	0.01	%	2	%	0.65	%	0.65	%	—	%	—	%
LODGING
'- Revenues, net	$141.4		$126.0		$15.4		12	%	$141.0		$128.6		$12.4		10	%
'- Room nights	9.2		9.9		(0.7)		(7)	%	9.2		10.0		(0.9)		(9)	%
'- Revenues, net per room night	$15.41		$12.78		$2.62		21	%	$15.36		$12.81		$2.55		20	%
BRAZIL
'- Revenues, net	$134.2		$108.6		$25.6		24	%	$126.0		$108.6		$17.4		16	%
'- Tags (average monthly)	6.7		6.2		0.4		7	%	6.7		6.2		0.4		7	%
'- Revenues, net per tag	$20.16		$17.47		$2.69		15	%	$18.94		$17.47		$1.47		8	%
OTHER1
'- Revenues, net	$71.0		$66.3		$4.7		7	%	$70.5		$66.3		$4.2		6	%
'- Transactions	296.6		249.4		47.1		19	%	296.6		249.4		47.1		19	%
'- Revenues, net per transaction	$0.24		$0.27		$(0.03)		(10)	%	$0.24		$0.27		$(0.03)		(11)	%
FLEETCOR CONSOLIDATED REVENUES, NET
'- Revenues, net	$970.9		$893.0		$77.9		9	%	$991.1		$898.3		$92.8		10	%

As Reported
Pro Forma and Macro Adjusted²
Three Months Ended September 30, Three Months Ended September 30,
(Unaudited) 2017 2016 Change
%
Change

2017³

2016⁴
Change
%
Change
FUEL CARDS
‑Transactions⁵
119.6
112.5
7.1
6 % 119.6
113.6
6.0
5 %
‑Revenues, net per transaction $ 2.31
$ 2.30
$ 0.01
— % $ 2.29
$ 2.28
$ 0.01
— %
‑ Revenues, net $ 276.2
$ 258.8
$ 17.4
7 % $ 274.0
$ 259.5
$ 14.5
6 %
CORPORATE PAYMENTS

‑Transactions 10.9
10.0
0.9
9 % 10.9
10.2
0.7
7 %
‑Revenues, net per transaction $ 6.63
$ 4.61
$ 2.02
44 % $ 6.58
$ 5.99
$ 0.58
10 %
‑ Revenues, net $ 72.2
$ 46.1
$ 26.1
57 % $ 71.7
$ 61.3
$ 10.4
17 %
TOLLS

‑Transactions 231.0
81.1
149.8
185 % 231.0
225.0
5.9
3 %
‑Revenues, net per transaction $ 0.36
$ 0.32
$ 0.04
13 % $ 0.35
$ 0.30
$ 0.05
16 %
‑ Revenues, net $ 82.9
$ 25.8
$ 57.1
221 % $ 80.8
$ 67.8
$ 13.0
19 %
LODGING

‑Transactions 4.1
3.5
0.6
17 % 4.1
3.5
0.6
17 %
‑Revenues, net per transaction $ 8.14
$ 8.04
$ 0.10
1 % $ 8.14
$ 8.04
$ 0.10
1 %
‑ Revenues, net $ 33.2
$ 28.1
$ 5.2
18 % $ 33.2
$ 28.1
$ 5.2
18 %
GIFT

‑Transactions 294.1
269.5
24.6
9 % 294.1
269.5
24.6
9 %
‑Revenues, net per transaction $ 0.19
$ 0.22
$ (0.03 ) (14 )% $ 0.19
$ 0.22
$ (0.03 ) (14 )%
‑ Revenues, net $ 54.8
$ 58.3
$ (3.5 ) (6 )% $ 54.8
$ 58.3
$ (3.5 ) (6 )%
OTHER¹

‑Transactions⁵
19.4
20.8
(1.4 ) (7 )% 19.4
20.4
(1.0 ) (5 )%
‑Revenues, net per transaction $ 3.01
$ 3.24
$ (0.22 ) (7 )% $ 2.99
$ 2.80
$ 0.20
7 %
‑ Revenues, net $ 58.5
$ 67.4
$ (8.8 ) (13 )% $ 58.1
$ 57.1
$ 1.0
2 %
FLEETCOR CONSOLIDATED REVENUES

‑Transactions⁵
679.1
497.5
181.6
37 % 679.1
642.2
36.8
6 %
‑Revenues, net per transaction $ 0.85
$ 0.97
$ (0.12 ) (13 )% $ 0.84
$ 0.83
$ 0.01
2 %
‑ Revenues, net $ 577.9
$ 484.4
$ 93.5
19 % $ 572.6
$ 532.1
$ 40.6
8 %



*Columns may not calculate due to impact of rounding.
¹Other includes ~~telematics, maintenance, food,~~Gift and ~~transportation related businesses.~~Payroll Card operating segments.
² Pro forma and macro adjusted revenue is a non-GAAP financial measure defined as revenues, net adjusted for the impact of the macroeconomic environment and acquisitions and dispositions and other one-time items. We use pro forma and macro adjusted revenue as a basis to evaluate our organic growth. See ~~the~~ heading entitled ~~“Management’s~~"Managements' Use of Non-GAAP Financial ~~Measures”~~Measures" for a reconciliation of pro forma and macro adjusted revenue by ~~product,~~solution and metric non-GAAP measures to the ~~GAAP equivalent.~~comparable financial measure calculated in accordance with GAAP.
³~~2017 is adjusted~~* Columns may not calculate due to ~~remove the impact of changes in the macroeconomic environment to be consistent with the same period of prior year, using constant fuel prices, fuel price spreads and foreign exchange rates.~~
⁴~~2016 is pro forma to include acquisitions and exclude dispositions consistent with 2017 ownership.~~
⁵~~2016 and YTD 2017 transactions reflect immaterial corrections from previously disclosed amounts for the prior period.~~ rounding.

Organic revenue growth is a supplemental non-GAAP financial measure of operating performance. Organic revenue growth is calculated as revenue in the current period adjusted for the impact of changes in the macroeconomic environment (to include fuel price, fuel price spreads and changes in foreign exchange rates) over revenue in the comparable prior period adjusted to include or remove the impact of acquisitions and/or divestitures and non-recurring items that have occurred subsequent to that period. See the heading entitled "Management’s Use of Non-GAAP Financial Measures" for more information and a reconciliation of the non-GAAP financial measure to the most directly comparable financial measure calculated in accordance with GAAP. We believe that organic revenue growth on a macro-neutral, one-time item, and consistent acquisition/divestiture/non-recurring item basis is useful to investors for understanding the performance of FLEETCOR.

Revenue per relevant key performance indicator (KPI), which may include transaction, ~~is derived from the various revenue types as discussed above and~~spend volume, monthly tags, room nights, or other metrics, can vary based on geography, the relevant merchant relationship, the payment product utilized and the types of products or services purchased, the mix of which would be influenced by our acquisitions, organic growth in our business, and the overall macroeconomic environment, including fluctuations in foreign currency exchange rates, fuel prices and fuel ~~spread margins.~~price spreads. Revenue per ~~transaction~~KPI per customer ~~changes~~may change as the level of services we provide to a customer increases or decreases, as macroeconomic factors change and as adjustments are made to merchant and customer rates. See ~~“Results~~"Results of ~~Operations”~~Operations" for further ~~discussion of transaction volumes and revenue per transaction.~~

discussion.

Sources of Expenses

We incur expenses in the following categories:

~~Merchant commissions~~—In certain of our card programs, we incur merchant commissions expense when we reimburse merchants with whom we have direct, contractual relationships for specific transactions where a customer purchases products or services from the merchant. In the card programs where it is paid, merchant commissions equal the difference between the price paid by us to the merchant and the merchant’s wholesale cost of the underlying products or services.

•Processing—Our processing expense consists of expenses related to processing transactions, servicing our customers and merchants, ~~bad debt expense~~credit losses and cost of goods sold related to our hardware and card sales in certain businesses.

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•Selling—Our selling expenses consist primarily of wages, benefits, sales commissions (other than merchant commissions) and related expenses for our sales, marketing and account management personnel and activities.

•General and administrative—Our general and administrative expenses include compensation and related expenses (including stock-based ~~compensation)~~compensation and bonuses) for our ~~executives,~~ finance and accounting, information technology, human resources, legal and other administrative personnel. Also included are facilities expenses, third-party professional services fees, travel and entertainment expenses, and other corporate-level expenses.

•Depreciation and amortization—Our depreciation expenses include depreciation of property and equipment, consisting of computer hardware and software (including proprietary software development amortization expense), card-reading equipment, furniture, fixtures, vehicles and buildings and leasehold improvements related to office space. Our amortization expenses include amortization of intangible assets related to customer and vendor relationships, trade names and trademarks, software and non-compete agreements. We are amortizing intangible assets related to business acquisitions and certain private label contracts associated with the purchase of accounts receivable.

•Other operating, net—Our other operating, net includes other operating expenses and income items ~~unusual to the period and presented separately.~~

~~Investment loss (income)—Our investment results~~that do not relate to our minority interest in Masternaut, a provider of telematics solutions to commercial fleets in Europe, which we historically accounted for using the equity method. On September 30, 2017, we entered into an amended Masternaut investment agreementcore operations or that ~~resulted in the loss of significant influence, and we began accounting for the Masternaut investment by applying the cost method.~~

occur infrequently.

•Other (income) expense, ~~(income),~~ net—Our other (income) expense, ~~(income),~~ net includes ~~foreign currency transaction~~ gains or losses ~~proceeds/costs~~ from the ~~sale~~following: sales of assets or businesses, foreign currency transactions, extinguishment of debt, and investments. This category also includes other miscellaneous ~~operating~~non-operating costs and revenue.

Certain of these items may be presented separately on the Consolidated Statements of Income.

•Interest expense, net—Our interest expense, net includes interest ~~income on our cash balances and interest~~ expense on our outstanding debt, ~~and~~interest income on our ~~Securitization Facility. We have historically invested~~cash and cash equivalents balances and interest on our ~~cash primarily in short-term money market funds.~~

interest rate and cross-currency swaps.

~~Loss on extinguishment of debt—Loss on extinguishment of debt relates to our write-off of debt issuance costs associated with the refinancing of our existing credit facility.~~

•Provision for income taxes—Our provision for income taxes consists ~~primarily~~ of corporate income taxes related primarily to profits resulting from the sale of our products and services ~~in the United States and internationally.~~

on a global basis.

Factors and Trends Impacting our Business

We believe that the following factors and trends are important in understanding our financial performance:

•Global economic conditions—Our results of operations are materially affected by conditions in the economy generally, in North America, Brazil, and in other locations internationally, including the current conflict between Russia and Ukraine and other geopolitical events in the Middle East, as discussed elsewhere in this Quarterly Report on Form 10-Q. Factors affected by the economy include our transaction volumes, the credit risk of our customers and changes in tax laws across the globe. These factors affected our businesses in each of our segments.

•Foreign currency changes—Our results of operations are significantly impacted by changes in foreign currency exchange rates; namely, by movements of the Australian dollar, Brazilian real, British pound, Canadian dollar, Czech koruna, euro, Mexican peso, New Zealand dollar and Russian ruble (for periods prior to the disposition of our Russian business), relative to the U.S. dollar. Approximately 57% and 61% of our revenue in the nine months ended September 30, 2023 and 2022, respectively, was derived in U.S. dollars and was not affected by foreign currency exchange rates. See "Results of Operations" for information related to foreign currency impact on our total revenue, net.

Our cross-border foreign currency trading business aggregates foreign exchange exposures arising from customer contracts and economically hedges the resulting net currency risks by entering into offsetting contracts with established financial institution counterparties. These contracts are subject to counterparty credit risk.

•Fuel prices—Our fleet customers use our products and services primarily in connection with the purchase of fuel. Accordingly, our revenue is affected by fuel prices, which are subject to significant volatility. A change in retail fuel prices could cause a decrease or increase in our revenue from several sources, including fees paid to us based on a percentage of each customer’s total purchase. Changes in the absolute price of fuel may also impact unpaid account balances and the late fees and charges based on these amounts. We estimate approximately 10% and 13% of revenues, net were directly impacted by changes in fuel price in the three months ended September 30, 2023 and 2022, respectively. We estimate approximately 11% and 13% of revenues, net were directly impacted by changes in fuel price in the nine months ended September 30, 2023 and 2022, respectively. See ~~“Sources~~"Results of ~~Revenue” above~~Operations" for ~~further~~ information related to the ~~absolute~~fuel price ~~of fuel.~~

impact on our total revenues, net.

•Fuel-price spread volatility—A portion of our revenue involves transactions where we derive revenue from ~~fuel-price~~fuel price spreads, which is the difference between the price charged to a fleet customer for a transaction and the price paid to the merchant for the same transaction. In these transactions, the price paid to the merchant is based on the wholesale cost of fuel. The merchant’s wholesale cost of fuel is dependent on several factors including, among others, the factors described above affecting fuel prices. The fuel price that we charge to our customer is dependent on several factors including, among others, the fuel price paid to the merchant, posted retail fuel prices and competitive fuel prices. We

experience ~~fuel-price~~fuel price spread contraction when the merchant’s wholesale cost of fuel increases at a faster rate than the fuel price we charge to our customers, or the fuel price we charge to our customers decreases at a faster rate than the merchant’s wholesale cost of fuel. The inverse of these situations produces fuel price spread expansion. We estimate approximately 4% and 6% of revenues, net were directly impacted by fuel price spreads in the three months ended September 30, 2023 and 2022, respectively. We estimate approximately 5% and 6% of revenues, net were directly impacted by fuel price spreads in the nine months ended September 30, 2023 and 2022, respectively. See ~~“Sources~~"Results of ~~Revenue” above~~Operations" for ~~further~~ information related to ~~fuel-price spreads.~~

the fuel price spread impact on our total revenues, net.

•Acquisitions—Since 2002, we have completed over 7595 acquisitions of companies and commercial account portfolios. Acquisitions have been an important part of our growth strategy, and it is our intention to continue to seek opportunities to increase our customer base and diversify our service offering through further strategic acquisitions. The impact of acquisitions has, and may continue to have, a significant impact on our results of operations and may make it difficult to compare our results between periods.

•Interest rates—~~Our results~~From January 1, 2022 to July 27, 2023, the U.S. Federal Open Market Committee has increased the benchmark rate eleven times for a total rate increase of ~~operations~~5.25%. Additional increases are ~~affected by interest rates.~~possible in future periods. We are exposed to market risk to changes in interest rates on our cash investments and ~~debt.~~

~~Global economic conditions—Our results~~debt, particularly in rising interest rate environments, which is partially offset by incremental interest income earned on cash and restricted cash. On January 22, 2019, we entered into three swap contracts. The objective of ~~operations are materially affected by conditions~~these swap contracts is to reduce the variability of cash flows in the ~~economy generally, both~~previously unhedged interest payments associated with $2.0 billion of variable rate debt, the sole source of which is due to changes in ~~North America~~the LIBOR benchmark interest rate. For each of these swap contracts, we paid a fixed monthly rate and ~~internationally. Factors affected by the economy include our transaction volumes~~received one month LIBOR. In January 2022 and ~~the credit risk~~2023, $1.0 billion and $500 million, respectively, of our ~~customers. These factors affected our businesses~~interest rate swaps matured. On May 4, 2023, we amended the remaining LIBOR-based swap. The amendment replaced LIBOR on the swap with one-month term SOFR resulting in ~~both our North America and International segments.~~

~~Foreign currency~~a pay-fixed monthly rate of 2.50%, without further changes~~—Our results~~ to the terms of ~~operations are significantly impacted by~~the swap. In January 2023, we entered into five swap contracts totaling $1.5 billion. In August 2023, we entered into eight additional interest rate swap contracts totaling $2.0 billion. The objective of these swap contracts is to reduce the variability of cash flows in the previously unhedged interest payments associated with variable rate debt, the sole source of which is due to changes in ~~foreign currency rates; namely, by movements~~the SOFR interest rate. For each of ~~the Australian dollar, Brazilian real, British pound, Canadian dollar, Czech koruna, Euro, Mexican peso, New Zealand dollar~~these swap contracts, we pay a fixed monthly rate and Russian ruble, relative to the U.S. dollar. Approximately 63% and 72% of our revenue in the nine months ended September 30, 2017 and 2016, respectively, was derived in U.S. dollars and was not affected by foreign currency exchange rates. See “Results of Operations” for information related to foreign currency impact on our total revenue, net.

receive one-month term SOFR.

•Expenses—Over the long term, we expect that our ~~general and administrative~~ expense will decrease as a percentage of revenue as our revenue ~~increases.~~increases, except for expenses related to transaction volume processed. To support our expected revenue growth, we plan to continue to incur additional sales and marketing expense by investing in our direct marketing, third-party agents, internet marketing, telemarketing and field sales force.

•Taxes—We pay taxes in various taxing jurisdictions, including the U.S., most U.S. states and many non-U.S. jurisdictions. The tax rates in certain non-U.S. taxing jurisdictions are different than the U.S. tax rate. Consequently, as our earnings fluctuate between taxing jurisdictions, our effective tax rate fluctuates.

Acquisitions and Investments

2023

~~On August 9, 2017,~~•In January 2023, we acquired ~~Cambridge~~ Global ~~Payments (“Cambridge”),~~Reach, a ~~leading business to business (B2B) international~~U.K.-based cross-border payments provider, for approximately ~~$584.1~~$102.9 million, ~~in cash,~~ net of cash acquired of $132.3 million and inclusive of a note payable of $23.9 million. Cambridge processes B2B cross-border payments, assisting business clients in making international payments to suppliers and employees. The purpose of this acquisition is to further expand our corporate payments footprint.cash.

~~On September 26, 2017,~~•In February 2023, we acquired the remainder of Mina Digital Limited, a ~~fuel card~~cloud-based electric vehicle ("EV") charging software platform, and we also acquired Business Gateway AG, a European-based vehicle maintenance provider, ~~in Russia. On October 13, 2017,~~for a total of approximately $32.2 million, net of cash.

•In September 2023, we acquired PayByPhone Technologies, Inc., a global mobile parking payment application, for approximately $303.2 million, net of cash.

Each of these 2023 acquisitions provide incremental geographic expansion of our products, with PayByPhone specifically intended to progress our broader strategy to transform our vehicle payments business.

2022

•In November 2022, we completed the acquisition of ~~Creative Lodging Solutions ("CLS"),~~Roomex, a ~~small~~European workforce lodging ~~tuck-in business.~~

~~During 2016, we completed acquisitions with an aggregate purchase price of $1.30 billion, net of cash acquired of $51.3 million, which includes deferred payments made during~~provider serving the ~~period related to prior year acquisitions of $6.1 million.~~

~~In August 2016, we acquired all of the outstanding stock of STP~~U.K. and German markets for $1.23 billion, net of cash acquired of $40.2 million. STP is an electronic toll payments company in Brazil and provides cardless fuel payments at a number of Shell sites throughout Brazil. The purpose of this acquisition was to expand our presence in the toll market in Brazil. We financed the acquisition using a combination of existing cash and borrowings under our credit facility.

~~During 2016, we acquired additional fuel card portfolios in the U.S. and the United Kingdom, additional Shell fuel card markets in Europe and Travelcard in the Netherlands totaling $76.7~~approximately $56.8 million, net of ~~cash acquired of $11.1 million.~~cash.

~~During 2016,~~•In September 2022, we made ~~additional investments~~an investment of ~~$7.9~~$6.1 million ~~related to~~in a U.K. based EV search and pay mapping service.

•In September 2022, we completed the acquisition of Plugsurfing, a European EV software and network provider, for $75.8 million, net of cash.

•In August 2022, we completed the acquisition of Accrualify, an accounts payable (AP) automation software company, for $41.2 million, net of cash.

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•In March 2022, we completed the acquisition of Levarti, a U.S.-based airline software platform company, for $23.7 million, net of cash.

•In February 2022, we made an investment of $7.8 million in Mina Digital Limited, an EV charging payments business and $5.0 million in an EV data analytics business.

Results from our ~~investment~~Levarti acquisition are included in ~~Masternaut. We also received a $9.2 million return of~~ our ~~investment in Masternaut.~~

~~We report our~~Lodging segment, results from ~~Cambridge acquired in the third quarter of 2017~~our Accrualify and Global Reach acquisitions are reported in our ~~North America~~Corporate Payments segment, ~~for Cambridge's business~~and results from our Plugsurfing, Business Gateway AG, Mina and PayByPhone acquisitions are reported in ~~the United States and Canada and within~~ our International segment for Cambridge's business in all other countries outside of the United States and Canada. We are continuing to evaluate the allocation of Cambridge results to our reporting units and segments. The results of operations from the fuel card business in Russia are included within our International segment, from the date of acquisition. The results of operations from the fuel card portfolio acquired in the U.S. are included within our North America segment, from the date of acquisition. The results of operations of STP, the fuel card portfolio in the United Kingdom, the additional Shell markets, the Travelcard business in the Netherlands and the small business in Brazil are included within our InternationalFleet segment, from the date of acquisition.

~~Asset Dispositions~~

~~Telematics Businesses~~

~~on the disposal is included in other (income) expense, net in the accompanying Unaudited Consolidated Statements of Income. NexTraq has historically been included in our North America segment.~~

On September 30, 2017, we entered into an amended Masternaut investment agreement that resulted in the loss of significant influence, and we began accounting for the Masternaut investment by applying the cost method.

We regularly evaluate the carrying value of our Masternaut investment and during the third quarter of 2017, we determined that the fair value of our 44% investment in Masternaut had declined as a result of our loss of significant influence due to the amendment of the Masternaut investment agreement, executed September 30, 2017. As a result, we determined that the carrying value of our investment exceeded its fair value, and concluded that this decline in value was other than temporary. We recorded a $44.6 million impairment loss in the Masternaut investment that includes adjustment for $31.4 million of currency losses previously recognized in accumulated other comprehensive income, in the three and nine months ended September 30, 2017, in the accompanying Unaudited Consolidated Statements of Income.

Results of Operations

Three months ended September 30, ~~2017~~2023 compared to the three months ended September 30, ~~2016~~2022

The following table sets forth selected unaudited consolidated ~~statement~~statements of income ~~data~~ for the three months ended September 30, ~~2017~~2023 and ~~2016~~2022 (in ~~thousands)~~millions, except percentages)*.

(Unaudited) Three Months Ended September 30, 2017
% of total
revenue
Three Months Ended September 30, 2016
% of total
revenue

Increase
(decrease)
% Change
Revenues, net:
North America $ 364,443
63.1 % $ 345,868
71.4 % $ 18,575
5.4 %
International 213,434
36.9 % 138,558
28.6 % 74,876
54.0 %
Total revenues, net 577,877
100.0 % 484,426
100.0 % 93,451
19.3 %
Consolidated operating expenses:
Merchant commissions 27,687
4.8 % 28,214
5.8 % (527 ) (1.9 )%
Processing 111,283
19.3 % 96,233
19.9 % 15,050
15.6 %
Selling 45,060
7.8 % 34,180
7.1 % 10,880
31.8 %
General and administrative 92,043
15.9 % 77,904
16.1 % 14,139
18.1 %
Depreciation and amortization 69,156
12.0 % 57,084
11.8 % 12,072
21.1 %
Other operating, net 11
— % (244 ) (0.1 )% 255
104.5 %
Operating income 232,637
40.3 % 191,055
39.4 % 41,582
21.8 %
Investment loss 47,766
8.3 % 2,744
0.6 % 45,022
1,640.7 %
Other (income) expense, net (175,271 ) (30.3 )% 293
0.1 % 175,564
NM
Interest expense, net 29,344
5.1 % 17,814
3.7 % 11,530
64.7 %
Loss on extinguishment of debt 3,296
0.6 % —
— % 3,296
— %
Provision for income taxes 124,679
21.6 % 40,586
8.4 % 84,093
207.2 %
Net income $ 202,823
35.1 % $ 129,618
26.8 % $ 73,205
56.5 %
Operating income for segments:
North America $ 138,748
$ 135,760
$ 2,988
2.2 %
International 93,889
55,295
38,594
69.8 %
Operating income $ 232,637
$ 191,055
$ 41,582
21.8 %
Operating margin for segments:
North America 38.1 % 39.3 % (1.2 )%
International 44.0 % 39.9 % 4.1 %
Consolidated 40.3 % 39.4 % 0.8 %


(Unaudited)	Three Months Ended September 30, 2023		% of Total Revenues, net		Three Months Ended September 30, 2022		% of Total Revenues, net		Increase (decrease)		% Change
Revenues, net:
Fleet	$	365.5	37.6	%	$	395.2	44.3	%	$	(29.7)	(7.5)	%
Corporate Payments	258.8		26.7	%	196.9		22.1	%	61.9		31.4	%
Lodging	141.4		14.6	%	126.0		14.1	%	15.4		12.2	%
Brazil	134.2		13.8	%	108.6		12.2	%	25.6		23.6	%
Other	71.0		7.3	%	66.3		7.4	%	4.7		7.1	%
Total revenues, net	970.9		100.0	%	893.0		100.0	%	77.9		8.7	%
Consolidated operating expenses:
Processing	208.2		21.4	%	203.3		22.8	%	4.9		2.4	%
Selling	86.0		8.9	%	74.0		8.3	%	11.9		16.1	%
General and administrative	147.8		15.2	%	149.3		16.7	%	(1.5)		(1.0)	%
Depreciation and amortization	84.8		8.7	%	77.2		8.6	%	7.5		9.8	%
Other operating, net	(0.8)		(0.1)	%	—		—	%	(0.8)		NM
Operating income	445.0		45.8	%	389.2		43.6	%	55.8		14.3	%
Investment loss (gain)	—		—	%	0.2		—	%	(0.1)		NM
Other (income) expense, net	(13.4)		(1.4)	%	3.7		0.4	%	(17.1)		NM
Interest expense, net	88.3		9.1	%	45.4		5.1	%	42.9		94.4	%

Provision for income taxes	98.6		10.2	%	91.0		10.2	%	7.6		8.3	%
Net income	$	271.5	28.0	%	$	248.9	27.9	%	$	22.6	9.1	%

Operating income by segment:
Fleet	$	186.6			$	192.6			$	(6.0)	(3.1)	%
Corporate Payments	102.1				69.7				32.5		46.6	%
Lodging	74.0				63.5				10.6		16.6	%
Brazil	61.1				44.6				16.4		36.8	%
Other	21.1				18.8				2.3		12.5	%
Total operating income	$	445.0			$	389.2			$	55.8	14.3	%

NM = Not Meaningful

*The sum of the columns and rows may not calculate due to rounding.

~~Revenues~~Consolidated Results

~~Our consolidated~~Consolidated revenues, ~~increased from $484.4~~net

Consolidated revenues were $970.9 million in the three months ended September 30, ~~2016 to $577.9 million in the three months ended September 30, 2017,~~2023, an increase of ~~$93.5 million, or 19.3%.~~8.7% compared to the prior period. The increase in ~~our~~ consolidated ~~revenue~~revenues was due primarily ~~due to:~~

~~The impact of acquisitions during 2016 and 2017, which contributed approximately $58 million in additional revenue.~~

~~Organic~~to organic growth of ~~approximately 8% on a constant fuel price, fuel spread margin, foreign currency and pro forma basis,~~10%, driven by increases in ~~both volume~~transaction volumes and new sales growth and net revenue ~~per transaction~~growth of 1% from acquisitions completed in ~~certain of our payment programs.~~

Although we cannot precisely measure the impact of the macroeconomic environment, in total we believe it had a favorable impact on our consolidated revenue for the three months ended September 30, 2017 over the comparable period in 2016 of approximately $4 million. This was primarily due to favorable changes in foreign exchange rates in Brazil2022 and ~~the United Kingdom in the three months ended September 30, 2017 compared to 2016.~~

~~These increases were~~2023, partially offset by the ~~impact of~~macroeconomic environment that negatively impacted revenue growth by 2%. Revenues were also negatively impacted compared to the prior period by the disposition of ~~the NexTraq~~our Russia business in ~~July 2017 of approximately $10 million.~~

~~North America segment revenues~~

North America revenues increased from $345.9 million in the three months ended September 30, 2016 to $364.4 million in the three months ended September 30, 2017, an increase of $18.6 million, or 5.4%. The increase in our North America segment revenue was primarily due to:

~~The impact of our Cambridge acquisition during the third quarter of 2017, which contributed approximately $12 million in additional revenue.~~

~~Organic growth of approximately 5%, on a constant fuel price, fuel spread margin and pro forma basis, driven by increases in both volume and revenue per transaction in certain of our payment programs.~~August 2023.

Although we cannot precisely measure the impact of the macroeconomic environment, in total we believe it had a negative impact on our ~~North America segment revenue in~~consolidated revenues for the three months ended September 30, ~~2017~~2023 over the comparable period in ~~2016 of approximately $2 million,~~2022, driven primarily ~~due to the impact of~~by lower fuel ~~spread margins.~~

price spreads and fuel prices that lowered revenue by approximately $23 million and $12 million, respectively. These ~~increases~~decreases were partially offset by ~~the impact of the disposition of the NexTraq business in July 2017~~favorable foreign exchange rates of approximately ~~$10 million.~~$15 million, mostly in our U.K., Brazil and European businesses.

Consolidated operating expenses

~~International segment revenues~~

~~International segment revenues increased from $138.6~~Processing. Processing expenses were $208.2 million in the three months ended September 30, ~~2016~~2023, an increase of 2.4% compared to ~~$213.4~~the prior period. Increases were primarily due to approximately $10 million of expenses related to acquisitions completed in 2022 and 2023, the unfavorable impact of foreign exchange rates of $5 million and higher variable expenses driven by increased transaction volumes, partially offset by lower bad debt of $10 million.

Selling. Selling expenses were $86.0 million in the three months ended September 30, ~~2017,~~2023, an increase of ~~$74.9 million, or 54.0%. The increase~~16.1% from the prior period. Increases in ~~our International segment revenue was~~selling expenses were primarily ~~due to:~~

~~The impact of acquisitions during 2016 and 2017, which contributed approximately $~~46 ~~million in additional revenue.~~

~~Organic growth of approximately 12% on a constant macroeconomic and pro forma basis, driven by increases in both~~associated with commissions from higher sales volume and ~~revenue per transaction~~approximately $6 million of expenses related to acquisitions completed in ~~certain of our payment programs.~~2022 and 2023.

Although we cannot precisely measure the impact of the macroeconomic environment, in total we believe it had a positive impact on our International segment revenue for the three months ended September 30, 2017 over the comparable period in 2016 of approximately $6 million. Changes in foreign exchange ratesGeneral and ~~fuel price had favorable impacts on consolidated revenues of approximately $4 million~~administrative. General and ~~$2 million, respectively.~~

~~Consolidated operating~~administrative expenses

~~Merchant commissions.~~ ~~Merchant commissions decreased from $28.2~~ were $147.8 million in the three months ended September 30, ~~2016~~2023, a decrease of 1.0% from the prior period. The decrease in general and administrative expenses was primarily due to ~~$27.7~~lower stock based compensation expense, partially offset by the impact of acquisitions completed in 2022 and 2023 of approximately $7 million and other increases associated with the growth of our business over the comparable prior period.

Depreciation and amortization. Depreciation and amortization expenses were $84.8 million in the three months ended September 30, ~~2017, a decrease~~2023, an increase of ~~$0.5 million, or 1.9%. This decrease was~~9.8% from the prior period. Increases in depreciation and amortization expenses were primarily due to incremental investments in capital expenditures, namely technology over the ~~fluctuation of the margin between the wholesale cost~~past three years, as well as approximately $4 million due to acquisitions completed in 2022 and ~~retail price of fuel.~~2023.

~~Processing.~~ ~~Processing expenses increased from $96.2~~Consolidated operating income

Consolidated operating income was $445.0 million in the three months ended September 30, ~~2016~~2023, an increase of 14.3% compared to ~~$111.3~~the prior period. The increase in operating income was primarily due to the reasons discussed above and disciplined expense management, resulting in EBITDA margin expansion of 225 basis points over the prior period.

Other (income) expense, net. Other (income) expense, net was $13.4 million in the three months ended September 30, ~~2017, an increase of $15.1 million, or 15.6%. Increases in processing expenses were~~2023, which primarily ~~due to expenses related to acquisitions completed in 2016 and 2017~~represents the net gain of approximately ~~$14~~$13.7 million ~~and~~resulting from the ~~impact~~disposal of ~~foreign exchange rates and incremental spend due to increases in volume. These increases were partially offset by~~our Russia business during the ~~impact~~third quarter of ~~disposition of the NexTraq business of approximately $3 million and lower bad debt~~2023.

Interest expense, ~~of approximately $2 million.~~

~~Selling.~~ ~~Selling expenses increased from $34.2~~net. Interest expense, net was $88.3 million in the three months ended September 30, ~~2016 to $45.1 million in the three months ended September 30, 2017,~~2023, an increase of ~~$10.9~~$42.9 million or 31.8%. Increases in spending were primarily due to ongoing incremental expenses related to acquisitions completed in 2016 and 2017 of approximately $9 million, additional spending in certain lines of business andfrom the ~~impact of foreign exchange rates. These increases were partially offset by the impact of disposition of the NexTraq business of approximately $1 million.~~

~~General and administrative.~~ General and administrative expenses increased from $77.9 million in the three months ended September 30, 2016 to $92.0 million in the three months ended September 30, 2017, an increase of $14.1 million, or 18.1%. The increase was primarily due to ongoing expenses related to acquisitions completed in 2016 and 2017 of approximately $10 million, increased stock based compensation expense of approximately $7 million and the impact of foreign exchange rates. These increases were partially offset by the impact of disposition of the NexTraq business of approximately $1 million.

~~Depreciation and amortization.~~ Depreciation and amortization increased from $57.1 million in the three months ended September 30, 2016 to $69.2 million in the three months ended September 30, 2017, an increase of $12.1 million, or 21.1%. The increase was primarily due to amortization of intangible assets related to acquisitions completed in 2016 and 2017 of approximately $13 million, incremental expense related to capitalized development of software and the impact of foreign exchange rates. These increases were partially offset by the impact of disposition of the NexTraq business of approximately $2 million.

~~Investment loss.~~ Investment loss was $47.8 million in the three months ended September 30, 2017, compared to $2.7 million in the three months ended September 30, 2016. We regularly evaluate the carrying value of our Masternaut investment and during the third quarter of 2017, we determined that the fair value of our 44% investment in Masternaut had declined as a result of our loss of significant influence due to the amendment of the Masternaut investment agreement, executed September 30, 2017. As a result, we determined that the carrying value of our investment exceeded its fair value, and concluded that this decline in value was other than temporary. We recorded a $44.6 million impairment loss in the Masternaut investment that includes adjustment for $31.4 million of currency losses previously recognized in accumulated other comprehensive income, in the three months ended September 30, 2017, in the accompanying Unaudited Consolidated Statements of Income. There was also a non-recurring net recovery of purchase price of approximately $11 million during the second quarter of 2016.

~~Other (income) expense, net.~~ Other income, net was $175.3 million in the three months ended September 30, 2017, compared to other expense, net of $0.3 million in the three months ended September 30, 2016. The increase was due primarily to the pre-tax gain on the sale of our Nextraq business of $175 million in the third quarter of 2017.

~~Interest expense, net.~~ ~~Interest expense increased from $17.8 million in the three months ended September 30, 2016 to $29.3 million in the three months ended September 30, 2017, an increase of $11.5 million, or 64.7%.~~prior period. The increase in interest expense iswas primarily due to rising interest rates on our borrowings and net cash used in financing activities, partially offset by the ~~impact~~benefit of ~~additional borrowings to finance the acquisitions of STP~~higher cash balances in certain foreign jurisdictions and ~~Travelcard completed during the third quarter of 2016 and Cambridge completed during the third quarter of 2017, and increases~~an increase in ~~LIBOR.~~interest income from higher interest rates. The following table sets forth the average interest rates paid on borrowings under our Credit Facility, excluding the related unused ~~credit~~ facility ~~fees.~~fees and swaps.


	Three Months Ended September 30,					Three Months Ended September 30,
(Unaudited)	2017		2016		(Unaudited)	2023		2022
Term loan A	2.98	%	1.99	%	Term loan A	6.73	%	3.60	%
Term loan B	3.32	%	3.75	%	Term loan B	7.10	%	3.96	%
Domestic Revolver A	2.99	%	2.08	%
Foreign Revolver A	2.00	%	1.77	%
Foreign swing line	1.97	%	1.73	%
Revolving line of credit A & B (USD)					Revolving line of credit A & B (USD)	6.75	%	3.73	%
Revolving line of credit B (GBP)					Revolving line of credit B (GBP)	5.71	%	2.60	%

~~The average unused credit facility fee for Domestic Revolver A was~~ ~~0.35%~~We have a portfolio of interest rate swaps which are designated as cash flow hedges and ~~0.30%~~ ~~in the three month period ending~~ ~~September 30, 2017~~ ~~and~~ ~~2016, respectively.~~

~~Loss on extinguishment of debt.~~ ~~Loss on early extinguishment of debt of $3.3 million relates to our write-off of debt issuance costs associated with the refinancing of our existing credit facility during the third quarter of 2017.~~

~~Provision for income taxes.~~ ~~The provision for income taxes increased from $40.6 million in~~one cross-currency interest rate swap, which is designated as a net investment hedge. During the three months ended September 30, ~~2016~~2023, as a result of these swap contracts and net investment hedge, we recorded a benefit to ~~$124.7 million in the three months ended September 30, 2017, an increase~~interest expense, net of ~~$84.1 million, or 207.2%. We provide~~$14.7 million.

Provision for income taxes. The provision for income taxes ~~during interim periods based on an estimate of our~~and effective tax rate ~~for the year. Discrete items~~were $98.6 million and ~~changes in the estimate of the annual tax rate are recorded in the period they occur. Our effective tax rate increased from 23.9% for three months ended September 30, 2016 to 38.1%~~26.6% for the three months ended September 30, ~~2017.~~2023, compared to $91.0 million and 26.8% for the prior period. The ~~2017~~increase in the provision for

Table of Contents

income taxes of 8% is driven by the similar increase in income before income taxes. Income tax expense is based on an estimated annual effective rate, which requires us to make our best estimate of annual pretax accounting income or loss before consideration of tax or benefit discretely recognized in the period in which such occur. Our effective income tax rate ~~was impacted by~~for the ~~gain on sale of~~three months ended September 30, 2023 differs from the ~~NexTraq business of $175 million, all at~~U.S. federal statutory rate due primarily to the ~~higher U.S. tax rate, and the Masternaut impairment charge in the quarter, which had no corresponding tax benefit. Our tax rate in the quarter was 29.4%, excluding the~~unfavorable impact of ~~the NexTraq sale, investment impairment~~state taxes net of federal benefits, additional taxes on undistributed foreign-sourced income, and ~~loss~~foreign withholding taxes on ~~extinguishment of debt. The 2016 tax rate was favorably impacted by a one-time nonrecurring net gain at our Masternaut investment that favorably impacted pre-tax earnings, but was not subject to~~interest income ~~tax. The 2016 rate was also favorably impacted by higher excess tax benefits on share-based compensation in the third quarter of 2016 versus the third quarter of 2017.~~from intercompany notes.

We pay taxes in many different taxing jurisdictions, including the U.S., most U.S. states and many non-U.S. jurisdictions. The tax rates in certain non-U.S. taxing jurisdictions are lower than the U.S. tax rate. Consequently, as our earnings fluctuate between taxing jurisdictions, our effective tax rate fluctuates. Also, the excess tax benefit on share based compensation is part

~~of the effective tax rate. As a result, the tax rate is impacted by the number of stock options exercised or restricted shares vested during the reporting period.~~

Net income. For the reasons discussed above, our net income increased to $271.5 million, or 9.1%, from ~~$129.6~~the prior period, during the three months ended September 30, 2023.

Segment Results

Fleet

Fleet revenues were $365.5 million in the three months ended September 30, ~~2016~~2023, a decrease of 7.5% from the prior period. Fleet revenues were negatively impacted by the macroeconomic environment by approximately $31 million, driven primarily by unfavorable fuel price spreads of $23 million, lower fuel prices of $11 million, partially offset by favorable changes in foreign exchange rates on revenue of $3 million. The decrease in revenue was also due to ~~$202.8~~the disposition of our Russia business in August 2023 of $17 million and softness in our small fleet customers based in the U.S. Our shift away from micro clients in the U.S. affected our sales and overall results, including lower late fees revenue, which were down 21% from the comparable prior period. These negative impacts were partially offset by organic revenue growth of 4%, driven by new sales growth in our international markets, higher revenue per transaction, as well as the impact of acquisitions, which contributed approximately $3 million in revenue.

Fleet operating income was $186.6 million in the three months ended September 30, ~~2017, an increase~~2023, a decrease of ~~$73.2~~3.1% from the prior period due to the reasons discussed above and the flow through impact of the disposition of our Russia business, which resulted in lower operating income of approximately $12 million. These unfavorable impacts were partially offset by lower bad debt of approximately $16 million, ~~or 56.5%.~~

~~Operating income and operating margin~~

~~Consolidated~~as we shift to higher credit quality customers in the U.S. The decline in bad debt expense more than offset the drag on revenue from shifting away from micro clients, resulting in a net positive impact on operating income. ~~Operating income increased from $191.1~~

Corporate Payments

Corporate Payments revenues were $258.8 million in the three months ended September 30, ~~2016~~2023, an increase of 31.4%, from the prior period. Corporate Payments revenues increased primarily due to ~~$232.6~~organic revenue growth of 20%, driven by 20% organic growth in spend volume, strong new sales in our AP and cross-border solutions and the impact of acquisitions, which contributed approximately $17 million in revenue.

Corporate Payments operating income was $102.1 million in the three months ended September 30, ~~2017,~~2023, an increase of ~~$41.6 million, or 21.8%. Our operating margin was 39.4% and 40.3% for~~46.6% from the ~~three months ended September 30, 2016 and 2017, respectively. The increase in~~prior period. Corporate Payments operating income ~~was~~and margin increased primarily due to ~~acquisitions completed in 2016~~revenue growth and ~~2017~~operating leverage and ~~organic growth,~~integration synergies, as ~~well as the positive impact of the macroeconomic environment of approximately $4 million, driven primarily by favorable fuel prices and fluctuations in foreign exchange rates. These increases were~~revenues grew faster than expenses, partially offset by ~~the negative impact of~~ higher amortization and depreciation expense related to acquisitions of STP and Travelcard completed in the third quarter of 2016 and Cambridge completed in the third quarter of 2017, additional stock based compensation of approximately $7 million and the dispositionselling expenses driven by growth of the ~~NexTraq business in July 2017 of approximately $4 million.~~business.

For the purpose of segment operating results, we calculate segment operating income by subtracting segment operating expenses from segment revenue. Segment operating margin is calculated by dividing segment operating income by segment revenue.Lodging

~~North America segment operating income.~~ ~~North America operating income increased from $135.8~~Lodging revenues were $141.4 million in the three months ended September 30, ~~2016~~2023, an increase of 12.2% from the prior period. Lodging revenues increased primarily due to ~~$138.7~~organic revenue growth of 10% driven by our insurance and airline verticals, as well as the impact of acquisitions, which contributed approximately $3 million in revenue. Lodging revenues grew due to sales success across industry verticals, in addition to higher revenue per room night driven primarily from our distressed passenger product and higher hotel commission revenues. Offsetting this growth was softness in our construction and transportation verticals as the weaker macroeconomic environment is impacting these sectors, resulting in lower room nights.

Lodging operating income was $74.0 million in the three months ended September 30, ~~2017,~~2023, an increase of ~~$3.0 million, or 2.2%. North America operating margin was 39.3% and 38.1% for~~16.6% from the ~~three months ended September 30, 2016 and 2017, respectively. The increase in~~prior period. Lodging operating income ~~was~~and margin increased primarily due ~~primarily~~ to ~~organic~~revenue growth and ~~the positive impact of the macroeconomic environment of approximately $1 million, driven by favorable fuel prices. These increases~~our operating leverage, as revenues grew faster than expenses.

Brazil

Brazil revenues were partially offset by additional stock based compensation of approximately $6 million, the negative impact of higher amortization and depreciation expense related to our acquisition of Cambridge in the third quarter of 2017 and the disposition of the NexTraq business in July 2017 of approximately $4 million.

~~International segment operating income.~~ ~~International operating income increased from $55.3~~$134.2 million in the three months ended September 30, ~~2016~~2023, an increase of 23.6% from the prior period. Brazil revenues increased primarily due to ~~$93.9~~organic revenue growth of 16% driven by increases in toll tags sold and expanded product utility, with the differentiated value proposition of our products, as well as the positive impact of foreign exchange rates on revenues of approximately $9 million.

Brazil operating income was $61.1 million in the three months ended September 30, ~~2017,~~2023, an increase of ~~$38.6~~36.8% from the prior period. Brazil operating income increased primarily due revenue growth and our operating leverage, as revenues grew faster than expenses and the flow through impact of the favorable impact of macroeconomic environment on operating income of approximately $3 million.

Other

Other revenues were $71.0 million ~~or 69.8%. International operating margin was 39.9% and 44.0% for~~in the three months ended September 30, ~~2016~~2023, an increase of 7.1% from the prior period, primarily due to organic revenue growth of 6% driven by the timing of gift card sales and ~~2017, respectively. The increase in~~increased transactions volume over the prior period.

Other operating income was ~~due primarily to the impact of acquisitions completed in 2016 and organic growth, as well as the positive impact of the macroeconomic environment of approximately $3~~$21.1 million driven primarily by favorable fluctuations in foreign exchange rates. The higher operating margin was driven by the positive impact of process improvements in our recently acquired STP business, offset by higher amortization and depreciation expense related to acquisitions of STP and Travelcard completed in the ~~third quarter~~three months ended September 30, 2023, an increase of ~~2016~~12.5% from the prior period, with the increase primarily due to revenue growth and ~~additional stock based compensation expense of approximately $1 million.~~our operating leverage, as revenues grew faster than expenses.

Nine months ended September 30, ~~2017~~2023 compared to the nine months ended September 30, ~~2016~~2022

The following table sets forth selected unaudited consolidated ~~statement~~statements of income ~~data~~ for the nine months ended September 30, ~~2017~~2023 and ~~2016~~2022 (in ~~thousands)~~millions, except percentages)*.

(Unaudited) Nine Months Ended September 30, 2017
% of total
revenue
Nine Months Ended September 30, 2016
% of total
revenue

Increase
(decrease)
% Change
Revenues, net:
North America $ 1,037,386
63.3 % $ 950,542
72.2 % $ 86,844
9.1 %
International 602,161
36.7 % 366,051
27.8 % 236,110
64.5 %
Total revenues, net 1,639,547
100.0 % 1,316,593
100.0 % 322,954
24.5 %
Consolidated operating expenses:
Merchant commissions 82,690
5.0 % 78,755
6.0 % 3,935
5.0 %
Processing 316,429
19.3 % 256,738
19.5 % 59,691
23.2 %
Selling 122,854
7.5 % 92,680
7.0 % 30,174
32.6 %
General and administrative 275,046
16.8 % 209,084
15.9 % 65,962
31.5 %
Depreciation and amortization 198,731
12.1 % 141,848
10.8 % 56,883
40.1 %
Other operating, net 49
— % (690 ) (0.1 )% 739
107.1 %
Operating income 643,748
39.3 % 538,178
40.9 % 105,570
19.6 %
Investment loss (income) 52,497
3.2 % (2,247 ) (0.2 )% 54,744
(2,436.3 )%
Other (income) expense, net (173,626 ) (10.6 )% 1,056
0.1 % 174,682
NM
Interest expense, net 76,322
4.7 % 49,905
3.8 % 26,417
52.9 %
Loss on extinguishment of debt 3,296
0.2 % —
— % 3,296
— %
Provision for income taxes 227,756
13.9 % 132,503
10.1 % 95,253
71.9 %
Net income $ 457,503
27.9 % $ 356,961
27.1 % $ 100,542
28.2 %
Operating income for segments:
North America $ 394,646
$ 367,221
$ 27,425
7.5 %
International 249,102
170,957
78,145
45.7 %
Operating income $ 643,748
$ 538,178
$ 105,570
19.6 %
Operating margin for segments:
North America 38.0 % 38.6 % (0.6 )%
International 41.4 % 46.7 % (5.3 )%
Consolidated 39.3 % 40.9 % (1.6 )%


(Unaudited)	Nine Months Ended September 30, 2023		% of Total Revenues, net		Nine Months Ended September 30, 2022		% of Total Revenues, net		Increase (decrease)		% Change
Revenues, net:
Fleet	$	1,120.8	39.7	%	$	1,124.2	44.2	%	$	(3.3)	(0.3)	%
Corporate Payments	733.0		26.0	%	570.4		22.4	%	162.6		28.5	%
Lodging	400.3		14.2	%	337.4		13.3	%	62.8		18.6	%
Brazil	382.0		13.5	%	322.9		12.7	%	59.1		18.3	%
Other	184.3		6.5	%	188.6		7.4	%	(4.2)		(2.2)	%
Total revenues, net	2,820.4		100.0	%	2,543.5		100.0	%	276.9		10.9	%
Consolidated operating expenses:
Processing	618.4		21.9	%	563.1		22.1	%	55.4		9.8	%
Selling	254.0		9.0	%	230.2		9.1	%	23.7		10.3	%
General and administrative	461.9		16.4	%	440.3		17.3	%	21.6		4.9	%
Depreciation and amortization	252.7		9.0	%	232.5		9.1	%	20.2		8.7	%
Other operating, net	0.6		—	%	0.1		—	%	0.6		672	%
Operating income	1,232.8		43.7	%	1,077.4		42.4	%	155.5		14.4	%
Investment (gain) loss	(0.1)		—	%	0.5		—	%	(0.7)		NM
Other (income) expense, net	(15.1)		(0.5)	%	6.2		0.2	%	(21.3)		NM
Interest expense, net	256.6		9.1	%	90.5		3.6	%	166.1		183.5	%
Loss on extinguishment of debt	—		—		1.9		0.1	%	(1.9)		NM
Provision for income taxes	265.5		9.4	%	249.2		9.8	%	16.3		6.5	%
Net income	$	726.0	25.7	%	$	729.0	28.7	%	$	(3.0)	(0.4)	%

Operating income by segment:
Fleet	$	547.6			$	547.2			$	0.4	0.1	%
Corporate Payments	265.1				193.7				71.4		36.8	%
Lodging	196.8				161.8				35.0		21.6	%
Brazil	168.7				123.6				45.1		36.5	%
Other	54.6				51.0				3.6		7.0	%
Total operating income	$	1,232.8			$	1,077.4			$	155.5	14.4	%

NM = Not Meaningful

*The sum of the columns and rows may not calculate due to rounding.

Table of Contents

~~Revenues~~

~~Our consolidated~~Consolidated Results

Consolidated revenues, ~~increased from $1,316.6~~net

Consolidated revenues were $2,820.4 million in the nine months ended September 30, ~~2016 to $1,639.5 million in the nine months ended September 30, 2017,~~2023, an increase of ~~$323.0 million, or 24.5%.~~ 10.9% compared to the prior period. The increase in ~~our~~ consolidated ~~revenue~~revenues was due primarily ~~due to:~~

~~The impact of acquisitions during 2016 and 2017, which contributed approximately $175 million in additional revenue.~~

~~Organic~~to organic growth of ~~approximately 9% on a constant fuel price, fuel spread margin, foreign currency and pro forma basis,~~11%, driven by increases in ~~both volume~~transaction volumes and new sales growth and net revenue ~~per transaction~~growth of 2% from acquisitions completed in ~~certain of our payment programs.~~

Although we cannot precisely measure the impact of the macroeconomic environment, in total we believe it had a positive impact on our consolidated revenue for the nine months ended September 30, 2017 over the comparable period

~~in 2016 of approximately $17 million. We believe the favorable impact of higher fuel prices~~2022 and fuel spread margins, primarily in the U.S., had a favorable impact on consolidated revenues of approximately $22 million. Conversely, changes in foreign exchange rates had an unfavorable impact on consolidated revenues of approximately $5 million due to unfavorable fluctuations in foreign exchange rates primarily in Brazil and the United Kingdom in the nine months ended September 30, 2017 compared to 2016.

~~North America segment revenues~~

North America revenues increased from $950.5 million in the nine months ended September 30, 2016 to $1,037.4 million in the nine months ended September 30, 2017, an increase of $86.8 million, or 9.1%. The increase in our North America segment revenue was primarily due to:

~~The impact of our Cambridge acquisition during the third quarter of 2017, which contributed approximately $12 million in additional revenue.~~

~~Organic growth of approximately 8%, on a constant fuel price, fuel spread margin and pro forma basis, driven by increases in both volume and revenue per transaction in certain of our payment programs.~~

Although we cannot precisely measure the impact of the macroeconomic environment, in total we believe it had a positive impact on our North America segment revenue in nine months ended September 30, 2017 over the comparable period in 2016 of approximately $19 million. This was primarily due to the favorable impact of changes in fuel prices and slightly higher fuel spread margins.

~~These increases were partially offset by the impact of the disposition of the NexTraq business in July 2017 of approximately $10 million.~~

~~International segment revenues~~

International segment revenues increased from $366.1 million in the nine months ended September 30, 2016 to $602.2 million in the nine months ended September 30, 2017, an increase of $236.1 million, or 64.5%. The increase in our International segment revenue was primarily due to:

~~The impact of acquisitions during 2016 and 2017, which contributed approximately $163 million in additional revenue.~~

~~Organic growth of approximately 10% on a constant macroeconomic and pro forma basis, driven by increases in both volume and revenue per transaction in certain of our payment programs.~~August 2023.

Although we cannot precisely measure the impact of the macroeconomic environment, in total we believe it had a negative impact on our ~~International segment revenue~~consolidated revenues for the nine months ended September 30, ~~2017~~2023 over the comparable period in ~~2016~~2022, driven primarily by the unfavorable impact of fuel prices of approximately ~~$2 million. This was primarily due to~~$31 million, unfavorable ~~fluctuations in~~fuel price spreads of approximately $9 million and unfavorable foreign exchange rates ~~partially offset by the impact~~ of ~~higher fuel prices.~~approximately $4 million, mostly in our U.K. and European businesses.

Consolidated operating expenses

~~Merchant commissions.~~ ~~Merchant commissions increased from $78.8~~Processing. Processing expenses were $618.4 million in the nine months ended September 30, ~~2016~~2023, an increase of 9.8% compared to ~~$82.7~~the prior period. Increases were primarily due to approximately $29 million of expenses related to acquisitions completed in 2022 and 2023, incremental bad debt of $13 million and higher variable expenses driven by increased transaction volumes. Bad debt expense increased over the prior period as customer spend increased due to new sales and higher fuel prices in previous periods. These new customers tend to have higher collection loss rates. Additionally, we experienced higher losses among micro-SMB (small-medium business) customers during the first half of 2023 who were more severely impacted by negative economic conditions, which we addressed by shifting away from micro clients.

Selling. Selling expenses were $254.0 million in the nine months ended September 30, ~~2017, an~~2023, an increase of ~~$3.9~~10.3% from the prior period. Increases in selling expenses were primarily associated with approximately $17 million ~~or 5.0%. This increase was primarily due~~of expenses related to ~~the fluctuation of the margin between the wholesale cost~~acquisitions completed in 2022 and ~~retail price of fuel~~2023 and ~~the impact of~~commissions from higher ~~volume in certain revenue streams where merchant commissions are paid.~~sales volume.

~~Processing.~~ ~~Processing~~General and administrative. General and administrative expenses ~~increased from $256.7~~were $461.9 million in the nine months ended September 30, ~~2016~~2023, an increase of 4.9% from the prior period. Increases in general and administrative expenses were primarily due to ~~$316.4~~the impact of acquisitions completed in 2022 and 2023 of approximately $24 million and other increases associated with the growth of our business over the comparable prior period. These increases were partially offset by $10 million of lower stock based compensation expense.

Depreciation and amortization. Depreciation and amortization expenses were $252.7 million in the nine months ended September 30, ~~2017,~~2023, an increase of ~~$59.7 million, or 23.2%.~~8.7% from the prior period. Increases in ~~processing~~depreciation and amortization expenses were primarily due to ~~expenses related~~incremental capital investments over the past three years, as well as approximately $13 million due to acquisitions completed in ~~2016~~2022 and 2017 of approximately $45 million, inclusive of incremental bad debt expense of $11 million, as well as the impact of changes in foreign exchange rates, partially offset by the impact of negotiated lower vendor processing costs. The increase in bad debt2023.

Consolidated operating income

Operating income was ~~primarily due to bad debt inherent in the acquired STP business. These increases were partially offset by the impact of disposition of the NexTraq business of approximately $3 million.~~

~~Selling.~~ ~~Selling expenses increased from $92.7~~$1,232.8 million in the nine months ended September 30, ~~2016~~2023, an increase of 14.4% compared to ~~$122.9~~the prior period. The increase in operating income was primarily due to the reasons discussed above and disciplined expense management, resulting in EBITDA margin expansion of 120 basis points over the prior period. These favorable effects were partially offset by the flow through impact on operating income of unfavorable changes in foreign exchange rates of approximately $5 million.

Other (income) expense, net. Other (income) expense, net was $15.1 million in the nine months ended September 30, 2023, which primarily represents the net gain of approximately $13.7 million resulting from the disposal of our Russia business during the third quarter of 2023.

Interest expense, net. Interest expense, net was $256.6 million in the nine months ended September 30, ~~2017,~~2023, an increase of ~~$30.2~~$166.1 million ~~or 32.6%. Increases~~from the prior period. The increase in ~~spending were~~interest expense was primarily due to ~~ongoing expenses related to acquisitions completed~~rising interest rates on our borrowings and net cash used in ~~2016 and 2017 of approximately $19 million and additional spending in certain lines of business. These increases were~~financing activities, partially offset by the ~~impact~~benefit of ~~disposition of the NexTraq business of approximately $1 million.~~

~~General~~higher cash balances in certain foreign jurisdictions and ~~administrative.~~ ~~General and administrative expenses increased from $209.1 million in the nine months ended September 30, 2016 to $275.0 million in the nine months ended September 30, 2017,~~ an increase of $66.0 million, or 31.5%. The increase was primarily due to ongoing expenses related to acquisitions completed in 2016 and 2017 of approximately $28 million, increased stock based compensation expense of approximately $19 million and increases in other professional fees of approximately $7 million. These increases were partially offset by the impact of disposition of the NexTraq business of approximately $1 million.

~~Depreciation and amortization.~~ Depreciation and amortization increased from $141.8 million in the nine months ended September 30, 2016 to $198.7 million in the nine months ended September 30, 2017, an increase of $56.9 million, or 40.1%. The increase was primarily due to amortization of intangible assets related to acquisitions completed in 2016 and 2017 of approximately $39 million and incremental expense related to capitalized development of software. These increases were partially offset by the impact of disposition of the NexTraq business of approximately $2 million.

~~Investment loss (income).~~ Investment loss was $52.5 million in the nine months ended September 30, 2017, compared to investment income of $2.2 million in the nine months ended September 30, 2016. We regularly evaluate the carrying value of our Masternaut investment and during the third quarter of 2017, we determined that the fair value of our 44% investment in Masternaut had declined as a result of our loss of significant influence due to the amendment of the Masternaut investment agreement, executed September 30, 2017. As a result, we determined that the carrying value of our investment exceeded its fair value, and concluded that this decline in value was other than temporary. We recorded a $44.6 million impairment loss in the Masternaut investment that includes adjustment for $31.4 million of currency losses previously recognized in accumulated other comprehensive income, in the nine months ended September 30, 2017, in the accompanying Unaudited Consolidated Statements of Income.

~~Other (income) expense, net.~~ Other income, net was $173.6 million in the nine months ended September 30, 2017, compared to other expense, net of $1.1 million in the nine months ended September 30, 2016. The increase was due primarily to the pre-tax gain on the sale of our Nextraq business of $175 million in the third quarter of 2017.

~~Interest expense, net.~~ ~~Interest expense increased from $49.9 million in the nine months ended September 30, 2016 to $76.3 million in the nine months ended September 30, 2017, an increase of $26.4 million, or 52.9%. The~~ increase in interest expense is primarily due to the impact of additional borrowings to finance the acquisitions of STP and Travelcard completed during the third quarter of 2016 and Cambridge completed during the third quarter of 2017, and increases in LIBOR.income from higher interest rates. The following table sets forth the average interest rates paid on borrowings under our Credit Facility, excluding the related unused ~~credit~~ facility ~~fees.~~fees and swaps.


	Nine Months Ended September 30, 2023
(Unaudited)	2023		2022
Term loan A	6.39	%	2.56	%
Term loan B	6.73	%	2.80	%
Revolving line of credit A & B (USD)	6.40	%	2.73	%
Revolving line of credit B (GBP)	5.49	%	2.06	%

Nine Months Ended September 30,
(Unaudited) 2017 2016
Term loan A 2.74 % 1.96 %
Term loan B 3.28 % 3.75 %
Domestic Revolver A 2.78 % 2.00 %
Foreign Revolver A 2.01 % 1.77 %
Foreign swing line 1.97 % 1.73 %

~~The average unused credit facility fee for Domestic Revolver A was 0.35%~~We have a portfolio of interest rate swaps which are designated as cash flow hedges and ~~0.30% in~~one cross-currency interest rate swap, which is designated as a net investment hedge. During the nine ~~month period ending~~ months ended September 30, ~~2017~~2023, as a result of these swap contracts and ~~2016, respectively.~~net investment hedges, we recorded a benefit to interest expense, net of $31.0 million.

~~Loss on extinguishment of debt.~~ ~~Loss on extinguishment of debt of $3.3 million relates to our write-off of debt issuance costs associated with the refinancing of our existing credit facility during the third quarter of 2017.~~

Provision for income taxes. ~~The~~ The provision for income taxes and effective tax rate were $265.5 million and 26.8% for the nine months ended September 30, 2023, compared to $249.2 million and 25.5% for the prior period. Income tax expense is based on an estimated annual effective rate, which requires us to make our best estimate of annual pretax accounting income or loss before consideration of tax or benefit discretely recognized in the period in which such occur. Our provision for income taxes for the nine months ended September 30, 2023 increased primarily due to higher income before income taxes and less excess tax benefit on stock option exercises and an increase of $1.6 million incurred from ~~$132.5~~an uncertain tax position related to previous years. For the nine months ended September 30, 2022, the determination that certain foreign income was permanently reinvested resulted in a $9.0 million tax benefit that lowered the tax rate by 0.9%.

Net income. For the reasons discussed above, our net income decreased to $726.0 million in the nine months ended September 30, ~~2016~~2023, a decrease of 0.4% from the prior period.

Segment Results

Fleet

Fleet revenues were relatively flat at $1,120.8 million in the nine months ended September 30, 2023. Fleet revenues were negatively impacted by the macroeconomic environment by approximately $40 million, driven primarily by lower fuel prices of $27 million, unfavorable fuel price spreads of $9 million and unfavorable changes in foreign exchange rates on revenue of $4 million. The decrease in revenue was also due to ~~$227.8~~the disposition of our Russia business in August 2023 of $17 million and softness in our small fleet customers based in the U.S. Our shift away from micro clients in the U.S. affected our sales and overall results, including lower late fees revenue. These negative impacts were offset by organic revenue growth of 4%,driven by new sales growth in our international markets, higher revenue per transaction, as well as the impact of acquisitions, which contributed approximately $5 million in revenue.

Fleet operating income was also relatively flat at $547.6 million in the nine months ended September 30, ~~2017, an increase of $95.3 million, or 71.9%. We provide for income taxes during interim periods based on an estimate of our effective tax rate for~~2023 from the ~~year. Discrete items and changes in the estimate of the annual tax rate are recorded in the~~prior period ~~they occur. Our effective tax rate was 33.2% for the nine months ended September 30, 2017 as compared~~due to 27.1% in the nine months ended September 30, 2016. The increase in the provision for income taxes was due primarily to the pretax gain on sale of the Nextraq business of $175 million at the higher U.S. tax rate, all at the higher U.S. tax rate, and the Masternaut impairment charge in the quarter, which had no corresponding tax benefit. The 2016 tax rate was favorably impacted by a one-time nonrecurring net gain at our Masternaut investment that favorably impacted pre-tax earnings, but was not subject to income tax. The 2016 rate was also favorably impacted by higher excess tax benefits on share-based compensation in 2016 versus 2017.

~~Net income.~~ ~~For~~ the reasons discussed above, the flow through impact of the disposition of our ~~net~~Russia business, which resulted in lower operating income ~~increased from $357.0~~of approximately $12 million and incremental bad debt of $3 million.

Corporate Payments

Corporate Payments revenues were $733.0 million in the nine months ended September 30, ~~2016 to $457.5 million in the nine months ended September 30, 2017,~~2023, an increase of ~~$100.5 million, or 28.2%.~~

~~Operating income and operating margin~~

~~Consolidated operating income.~~ ~~Operating income~~28.5%, from the prior period. Corporate Payments revenues increased from $538.2 million in the nine months ended September 30, 2016 to $643.7 million in the nine months ended September 30, 2017, an increase of $105.6 million, or 19.6%. Our operating margin was 40.9% and 39.3% for the nine months ended September 30, 2016 and 2017, respectively. The increase in operating income was primarily due to ~~acquisitions completed~~organic revenue growth of 20%, driven by 19% organic growth in ~~2016~~spend volume, strong new sales in our AP and ~~2017, organic growth,~~cross-border solutions, as well as the ~~positive~~ impact of ~~the macroeconomic environment of~~acquisitions which contributed approximately ~~$14~~$45 million ~~driven primarily by favorable fuel prices, partially offset by the unfavorable impact of fluctuations~~ in ~~foreign exchange rates.~~revenue. These increases were partially offset by the negative impact of ~~higher amortization and depreciation expense related to acquisitions completed in 2016 and 2017, additional bad debt expense of $11 million, due to bad debt inherent in~~ the ~~acquired STP business, additional stock based compensation~~macroeconomic environment of approximately ~~$19~~$9 million, ~~and the disposition of the NexTraq business in July 2017 of approximately $4 million.~~primarily driven by unfavorable foreign exchange rates on revenues.

~~For the purpose of segment operating results, we calculate segment~~Corporate Payments operating income ~~by subtracting segment operating expenses from segment revenue. Segment operating margin is calculated by dividing segment operating income by segment revenue.~~

~~North America segment operating income.~~ ~~North America operating income increased from $367.2~~was $265.1 million in the nine months ended September 30, ~~2016~~2023, an increase of 36.8% from the prior period. Corporate Payments operating income and margin increased primarily due to ~~$394.6~~revenue growth and our operating leverage and integration synergies, as revenues grew faster than expenses. These increases were partially offset by higher selling expenses driven by growth of the business and the flow through impact of the unfavorable macroeconomic environment, which negatively impacted operating income by approximately $4 million.

Lodging

Lodging revenues were $400.3 million in the nine months ended September 30, ~~2017,~~2023, an increase of ~~$27.4~~18.6% from the prior period. Lodging revenues increased primarily due to organic revenue growth of 16% driven in our insurance and airline verticals, as well as the impact of acquisitions, which contributed $8 million ~~or 7.5%. North America operating margin~~in revenue. Lodging revenues grew due to sales success across industry verticals, in addition to higher revenue per room night driven primarily from our distressed passenger product and higher hotel commission revenues. Offsetting this growth was ~~38.6%~~softness in our construction and ~~38.0% for~~transportation verticals as the ~~nine months ended September 30, 2016 and 2017, respectively. The increase~~weaker macroeconomic environment is impacting these sectors, resulting in lower room nights.

Lodging operating income was due primarily to organic growth and the positive impact of the macroeconomic environment of approximately $18 million, driven by primarily by higher fuel prices. These increases were partially offset by additional stock based compensation of approximately $14 million, additional bad debt expense of approximately $4 million, the negative impact of higher amortization and depreciation expense related to our acquisition of Cambridge in the third quarter of 2017 and the disposition of the NexTraq business in July 2017 of approximately $4 million.

~~International segment operating income.~~ ~~International operating income increased from $171.0~~$196.8 million in the nine months ended September 30, ~~2016~~2023, an increase of 21.6% from the prior period. Lodging operating income and margin increased primarily due to ~~$249.1~~revenue growth and our operating leverage, as revenues grew faster than expenses.

Brazil

Brazil revenues were $382.0 million in the nine months ended September 30, ~~2017,~~2023, an increase of ~~$78.1 million, or 45.7%. International operating margin was 46.7%~~18.3% from the prior period. Brazil revenues increased primarily due to organic revenue growth of 16% driven by increases in toll tags sold and ~~41.4% for~~expanded product utility, with the ~~nine months ended September 30, 2016 and 2017, respectively. The increase in operating income was due primarily to~~differentiated value proposition of our products, as well as the positive impact of ~~acquisitions completed in 2016 and 2017, organic growth.~~foreign exchange rates on revenues of approximately $9 million. These increases were partially offset by the ~~negative~~ impact of ~~higher amortization and depreciation expense related to acquisitions~~unfavorable fuel prices of ~~STP and Travelcard completed~~approximately $2 million.

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Brazil operating income was $168.7 million in the ~~third quarter~~nine months ended September 30, 2023, an increase of ~~2016, additional bad debt expense of $9 million,~~36.5% from the prior period due to ~~bad debt inherent in~~revenue growth and our operating leverage, as revenues grew faster than expenses and due to the ~~acquired STP business, additional stock based compensation of approximately $5 million and the negative~~flow through impact of the favorable macroeconomic environment on operating income of approximately $4$2 million.

Other

Other revenues were $184.3 million in the nine months ended September 30, 2023, a decrease of 2.2% from the prior period, driven ~~primarily~~ by the ~~unfavorable impact~~timing of ~~fluctuations~~gift card sales.

Other operating income was $54.6 million in ~~foreign exchange rates.~~the nine months ended September 30, 2023, an increase of 7.0% from the prior period, with the increase primarily due to our operating leverage and disciplined expense management.

Liquidity and capital resources

Our principal liquidity requirements are to service and repay our indebtedness, make acquisitions of businesses and commercial account portfolios, repurchase shares of our common stock and meet working capital, ~~needs,~~ tax and capital expenditure needs.

Sources of ~~liquidity~~

liquidity. We believe that our current level of cash and borrowing capacity under our Credit Facility and Securitization Facility (each defined below), together with expected future cash flows from operations, will be sufficient to meet the needs of our existing operations and planned requirements for the next 12 months and the foreseeable future, based on our current assumptions. At September 30, ~~2017,~~2023, we had approximately $1.8 billion in total liquidity, consisting of approximately $0.7 billion available under our Credit Facility and unrestricted cash ~~balances totaled $1,018.3 million, with~~of $1.1 billion, of which approximately ~~$183.5 million restricted.~~ $0.6 billion is required for working capital purposes. Restricted cash primarily represents customer deposits repayable on demand held in ~~the Czech Republic and~~certain geographies with legal restrictions, collateral received from customers for cross-currency transactions in our ~~Comdata~~cross-border payments business, ~~in the U.S.,~~ which we are restricted from ~~using~~use other than to repay customer ~~deposits.~~

~~At September 30, 2017, cash~~deposits and ~~cash equivalents held in foreign subsidiaries where we have determined we are permanently reinvested is $509.3 million. All of the cash~~secure and ~~cash equivalents held by our foreign subsidiaries, excluding restricted cash, are available~~settle cross-currency transactions, and collateral posted with banks for ~~general corporate purposes. Our current intent is to permanently reinvest these funds outside of the U.S. Our current expectation for funds held~~hedging positions in our foreign subsidiaries is to use the funds to finance foreign organic growth, to pay for potential future foreign acquisitions and to repay any foreign borrowings that may arise from time to time. We currently believe that funds generated from our U.S. operations, along with available borrowing capacity in the U.S. will be sufficient to fund our

U.S. operations for the foreseeable future, and therefore do not foresee a need to repatriate cash held by our foreign subsidiaries in a taxable transaction to fund our U.S. operations. However, if at a future date or time these funds are needed for our operations in the U.S. or we otherwise believe it is in our best interests to repatriate all or a portion of such funds, we may be required to accrue and pay U.S. taxes to repatriate these funds. No assurances can be provided as to the amount or timing thereof, the tax consequences related thereto or the ultimate impact any such action may have on our results of operations or financial condition.

cross-border payments business.

We also utilize ~~an accounts receivable~~the Securitization Facility to finance a ~~majority~~portion of our domestic ~~fuel card~~ receivables, to lower our cost of borrowing and more efficiently use capital. ~~We generate and record accounts~~Accounts receivable ~~when a customer makes a purchase from a merchant using one of~~collateralized within our ~~card products and generally pay merchants before collecting the receivable. As a result, we utilize the~~ Securitization Facility ~~as a source of liquidity~~relate to ~~provide~~trade receivables resulting primarily from charge card activity and receivables related to our Lodging business in the cash flow required to fund merchant payments while we collect customer balances. These balances are primarily composed of charge balances, which are typically billed to the customer on a weekly, semimonthly or monthly basis, and are generally required to be paid within 14 days of billing.U.S. We also consider the available and undrawn amounts under our Securitization Facility and Credit Facility as funds available for working capital purposes and acquisitions. At September 30, ~~2017,~~2023, we had no additional liquidity under our Securitization Facility. ~~At September 30, 2017, we had approximately $612 million available under~~

We have determined that outside basis differences associated with our ~~Credit Facility.~~

~~Based on~~investments in foreign subsidiaries would not result in a material deferred tax liability, and, consistent with our ~~current forecasts and anticipated market conditions, we believe~~assertion that ~~our current cash balances, our available borrowing capacity and our ability~~these amounts continue to ~~generate cash from operations, will~~ be ~~sufficient to fund our liquidity needs~~indefinitely invested, have not recorded incremental income taxes for ~~at least~~ the ~~next twelve months. However, we regularly evaluate our cash requirements for current operations, commitments, capital requirements and acquisitions, and we may elect to raise~~ additional ~~funds for these purposes in the future, either through the issuance of debt or equity securities. We may not be able to obtain additional financing on terms favorable to us, if at all.~~outside basis differences.

Cash flows

The following table summarizes our cash flows for the nine ~~months~~month periods ended September 30, ~~2017~~2023 and ~~2016~~2022 (in millions).


	Nine Months Ended September 30,
(Unaudited)	2023		2022
Net cash provided by operating activities	$	903.9	$	438.6
Net cash used in investing activities	$	(345.6)	$	(267.7)
Net cash used in financing activities	$	(501.5)	$	(40.1)

Nine Months Ended September 30,
(Unaudited) 2017 2016
Net cash provided by operating activities $ 419.5
$ 404.3
Net cash used in investing activities (341.6 ) (1,371.5 )
Net cash provided by financing activities 250.1
976.4

Operating activities. Net cash provided by operating activities ~~increased from $404.3~~was $903.9 million in the nine months ended September 30, ~~2016~~2023, compared to ~~$419.5~~$438.6 million in the comparable prior period. The increase in operating cash flows was primarily due to favorable movements in working capital in the nine months ended September 30, 2023 over the comparable period in 2022.

Investing activities. Net cash used in investing activities was $345.6 million in the nine months ended September 30, ~~2017. Included~~2023 compared to $267.7 million in the comparable prior period. The increased use of cash ~~flows~~was primarily due to incremental spending on acquisitions completed in 2023 over the comparable period in 2022, partially offset by net proceeds of $197.0 million received for the disposition of our Russian business. Our capital expenditures were $117.2 million in the nine months ended September 30, 2023, an increase of $9.5 million, or 8.9%, from ~~operating~~$107.6 million in the comparable prior period due to the impact of acquisitions and continued investments in technology.

Financing activities. Net cash used in financing activities ~~were favorable non-cash adjustments of $151.7~~was $501.5 million in the nine months ended September 30, 2017. Non-cash adjustments were driven primarily by higher depreciation and amortization and an impairment charge in our Masternaut investment, partially offset by the gain on the sale of our Nextraq business2023, compared to $40.1 million in the ~~third quarter of 2017. Also included~~comparable prior period. The increase in net cash ~~flows from operating~~used by financing activities ~~were unfavorable working capital adjustments of $189.7 million. Working capital adjustments are~~was primarily due to ~~the timing~~an increase in net repayments on our credit facility and securitization facility of ~~cash receipts and payments during the nine months ended September 30, 2017 over the comparable period~~$1,289 million, offset by a decrease in ~~2016.~~

~~Investing activities.~~ ~~Net cash used in investing activities decreased from $1,371.5~~repurchases of common stock of $749 million in the nine months ended September 30, ~~2016 to $341.6 million~~2023 over the comparable period in the nine months ended September 30, 2017. The decrease was primarily due to the reduction in cash outlay for acquisitions and the proceeds received from the sale of our Nextraq business during the third quarter of 2017.2022.

~~Financing activities.~~ Net cash provided by financing activities decreased from $976.4 million in the nine months ended September 30, 2016 to $250.1 million in the nine months ended September 30, 2017. The decrease in cash provided by financing activities is primarily due to an increase in debt repayments of $437.4 million on our credit facility in the nine months ended September 30, 2017 as compared to 2016, increased spending to repurchase our common stock of $367 million and a decrease in borrowings of $76.8 million on our credit facility, partially offset by an increase in borrowings of $161 million on our Securitization Facility.

~~Capital spending summary~~

Our capital expenditures increased from $41.9 million in the nine months ended September 30, 2016 to $49.5 million in the nine months ended September 30, 2017, an increase of $7.6 million, or 18.1%. This increase is primarily due to increased spending on strategic projects, including continued investment in our operating systems, as well as incremental spending related to acquisitions in 2016 and 2017.

Credit Facility

~~FleetCor~~FLEETCOR Technologies Operating Company, LLC, and certain of our domestic and foreign owned subsidiaries, as designated co-borrowers (the ~~“Borrowers”~~"Borrowers"), ~~has~~are parties to a ~~$4.33~~$6.4 billion Credit Agreement (the "Credit Agreement"), with Bank of America, N.A., as administrative agent, swing line lender and ~~local currency~~letter of credit issuer, and a syndicate of financial institutions (the ~~“Lenders”~~"Lenders"), which has been amended multiple times. The Credit Agreement provides for senior secured credit facilities (collectively, the "Credit Facility") consisting of a revolving A credit facility in the amount of ~~$1.285~~$1.5 billion, a term loan A facility in the amount of ~~$2.69~~$3.0 billion and a term loan B facility in the amount of ~~$350.0 million as of September 30, 2017.~~$1.9 billion. The revolving credit facility consists of (a) a revolving A credit facility in the amount of ~~$800 million,~~$1 billion, with sublimits for letters of credit and swing line loans and (b) a revolving B facility in the amount of ~~$450~~$500 million with borrowings in U.S. dollars, euros, British pounds, Japanese yen or other currency as agreed in advance, and a sublimit for swing line loans and multi-currency borrowings and, (c) a revolving C facility in the amount of $35 million for multi-currency borrowings in Australian Dollars or New Zealand Dollars. On January 20, 2017, we entered into the second amendment to the Credit Agreement, which established a new term B loan. On August 2, 2017, we entered into the third amendment to the Credit Agreement, which increased the total facility by $708.7 million and extended the terms of the credit facilities. The term A and revolver maturity dates are August 2, 2022 and the term B maturity date is August 2,2024. The term A and revolver pricing remains the same and the term B pricing was reduced by 25 basis points to LIBOR plus 200 basis points. In addition, we pay a quarterly commitment fee at a rate per annum ranging from 0.20% to 0.40% of the daily unused portion of the credit facility.

loans. The Credit Agreement also ~~contains~~includes an accordion feature for borrowing an additional $750 million in term loan A, term loan B, revolving A or ~~revolver A~~revolving B facility debt and ~~term B.~~an unlimited amount when the leverage ratio on a pro-forma basis is less than 3.75 to 1.00. Proceeds from the ~~Credit Facility~~credit facilities may be used for working capital purposes, acquisitions, and other general corporate purposes.

The maturity date for the term loan A and revolving credit facilities A and B is June 24, 2027. The term ~~loans are payable in quarterly installments and are due~~loan B has a maturity date of April 30, 2028. On May 3, 2023, we entered into the thirteenth amendment to the Credit Facility. The amendment replaced LIBOR on the ~~last business day of each March, June, September, and December~~term B loan with the ~~final principal payment due~~Secured Overnight Financing Rate ("SOFR"), plus a SOFR adjustment of 0.10%.

At September 30, 2023, the interest rate on the ~~respective maturity date. Borrowings~~term loan A was 6.79%, the interest rate on the term loan B was 7.17%, the interest rate on the revolving ~~line of~~A and B facilities (USD borrowings) was 6.79%, and the interest rate on the revolving B facility (GBP borrowings) was 6.59%. The unused credit ~~are repayable~~facility fee was 0.25% at ~~our option of one, two, three or nine months after borrowing, depending~~September 30, 2023.

At September 30, 2023, we had $2.9 billion in borrowings outstanding on the term loan A, net of ~~the borrowing~~discounts, and $1.8 billion in borrowings outstanding on the ~~facility. Borrowings~~term loan B, net of discounts and debt issuance costs. We have unamortized debt issuance costs of $3.9 million related to the revolving facilities as of September 30, 2023 recorded within other assets in the Unaudited Consolidated Balance Sheets. We have unamortized debt discounts and debt issuance costs of $20.3 million related to our term loans at September 30, 2023 recorded in notes payable and other obligations, net of current potion within the Unaudited Consolidated Balance Sheets.

During the nine months ended September 30, 2023, we made principal payments of $70.5 million on the ~~foreign swing line~~term loans and net repayments of ~~credit are due no later than ten business days after such loan is made.~~

The Credit Facility contains representations, warranties and events of default, as well as certain affirmative and negative covenants, customary for financings of this nature. These covenants include limitations$94.3 million on the ~~ability to pay dividends and make other restricted payments under certain circumstances and compliance with certain financial ratios.~~ revolving facilities.

As of September 30, ~~2017,~~2023, we were in compliance with each of the covenants under the Credit ~~Facility.~~

At September 30, 2017, we had $2,690 million in borrowings outstanding on the term A loan, excluding the related debt discount, $350 million in borrowings outstanding on Term B loan, excluding the related debt discount, $595 million in borrowings outstanding on the domestic revolving A facility, $38 million in borrowings outstanding on the foreign revolving A facility and $40.2 million in borrowings outstanding on the swing line revolving A facility. We have unamortized debt discounts of $6.4 million related to the term A facility and $0.7 million related to the term B facility at September 30, 2017.

During the nine months ended September 30, 2017, we made principal payments of $388.7 million on the term loans, $715.0 million on the domestic revolving A facility, $89.8 million on the foreign revolving A facility and $52.7 million on the swing line revolving A facility.Agreement.

Securitization Facility

We are a party to a $1.7 billion receivables purchase agreement among ~~FleetCor~~FLEETCOR Funding LLC, as seller, PNC Bank, National Association as administrator, and various purchaser agents, conduit purchasers and related committed purchasers parties thereto ~~which was amended and restated for~~(the "Securitization Facility"). The Securitization Facility matures on August 18, 2025. At September 30, 2023, the ~~fifth time as of November 14, 2014. We refer to this arrangement as the Securitization Facility. There have been several amendments to the Securitization Facility. The current purchase limit under~~interest rate on the Securitization Facility is $950 million and the Securitization Facility expires on November 14, 2017. The Securitization Facility contains certain customary financial covenants. There is a program fee equal to one month LIBOR or the Commercial Paper Rate of 1.27% plus 0.90% and 0.85% plus 0.90% as of September 30, 2017 and December 31, 2016, respectively. The unused facility fee is payable at a rate of 0.40% as of September 30, 2017 and December 31, 2016, respectively.was 6.38%.

The Securitization Facility provides for certain termination events, which includes nonpayment, upon the occurrence of which the administrator may declare the facility termination date to have occurred, may exercise certain enforcement rights with respect to the receivables, and may appoint a successor servicer, among other things.

We were in compliance with ~~the~~all financial and non-financial covenant requirements related to our Securitization Facility as of September 30, ~~2017.~~2023.

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Cross-Border Facilities

We carefully monitor and manage initial and variation margin requirements for our cross-border solutions, which can result in transitory periods of elevated liquidity needs in cases where the currency market experiences disruption. In order to help mitigate that liquidity risk, we have recently entered into facilities intended to provide additional means to manage working capital needs for our cross-border solutions.

During the three months ended September 30, 2023, we entered into an $80.0 million unsecured overdraft facility which may be accessible via written request and corresponding authorization from the lender. There is no guarantee the uncommitted capacity will be available to us on a future date. Interest on drawn balances accrues at a fixed rate equal to the lender's reference rate (as defined in the agreement) plus 1%. As of September 30, 2023, we had no borrowings outstanding under the uncommitted credit facility.

During October 2023, we entered into a 364-day committed revolving credit facility with a total commitment of $40.0 million. This committed facility matures on October 10, 2024. Borrowings under the new facility will bear interest at the borrower’s option at a rate equal to (a) Term SOFR (as defined in the agreement) plus 1.25% or (b) the Base Rate (determined by reference to the greatest of (i) the Federal Funds Effective Rate, at that time, plus 0.50%, (ii) the Prime Rate, at that time, and (iii) Term SOFR (as defined in the agreement) at such time plus 1.00%).

Cash Flow Hedges

On January 22, 2019, we entered into three LIBOR-based swap contracts. One contract (which matured in January 2022) had a notional value of $1.0 billion, one contract (which matured in January 2023) had a notional value of $500 million and the remaining contract, which will mature on December 19, 2023, has a notional value of $500 million. The objective of these swap contracts was to reduce the variability of cash flows in the previously unhedged interest payments associated with $2.0 billion of variable rate debt, the sole source of which is due to changes in the LIBOR benchmark interest rate. These swap contracts qualify as hedging instruments and have been designated as cash flow hedges. On May 4, 2023, we amended the remaining LIBOR-based swap. The amendment replaced LIBOR on the swap with one-month term SOFR resulting in a pay-fixed monthly rate of 2.50%, without further changes to the terms of the swap.

During January 2023, we entered into five receive-variable SOFR, pay-fixed interest rate swap derivative contracts with a cumulative notional U.S. dollar value of $1.5 billion as shown disaggregated in the table below.

In August 2023, we entered into eight additional receive-variable SOFR, pay-fixed interest rate swap derivative contracts with a cumulative notional U.S. dollar value of $2.0 billion, as shown disaggregated in the table below.

As of September 30, 2023, we had the following outstanding interest rate swap derivatives that qualify as hedging instruments within designated cash flow hedges of variable interest rate risk (in millions):


Notional Amount	Fixed Rates	Maturity Date
$500	2.50%	12/19/2023
$250	4.01%	7/31/2025
$250	4.02%	7/31/2025
$500	3.80%	1/31/2026
$250	3.71%	7/31/2026
$250	3.72%	7/31/2026
$100	4.35%	7/31/2026
$250	4.40%	7/31/2026
$250	4.40%	7/31/2026
$400	4.33%	7/31/2026
$250	4.29%	1/31/2027
$250	4.29%	1/31/2027
$250	4.19%	7/31/2027
$250	4.19%	7/31/2027

The purpose of these contracts is to reduce the variability of cash flows in interest payments associated with $4.0 billion of unspecified variable rate debt, the sole source of which is due to changes in the SOFR benchmark interest rate. For each of these swap contracts, we pay a fixed monthly rate and receive one month SOFR.

Our cash flow hedges resulted in a $24.6 million reduction in interest expense, net during the nine months ended September 30, 2023.

Net Investment Hedge

In February 2023, we entered into a cross-currency interest rate swap that we designated as a net investment hedge of our investments in euro-denominated operations. This contract effectively converts $500 million of U.S. dollar equivalent to an obligation denominated in euro, and partially offsets the impact of changes in currency rates on our euro-denominated net investments. This contract also creates a positive interest differential on the U.S. dollar-denominated portion of the swap, resulting in a 1.96% interest rate savings on the USD notional.

Hedge effectiveness is tested based on changes in the fair value of the cross-currency swap due to changes in the USD/euro spot rate. We anticipate perfect effectiveness of the designated hedging relationship and record changes in the fair value of the cross-currency interest rate swap associated with changes in the spot rate through accumulated other comprehensive loss. Excluded components associated with the forward differential are recognized directly in earnings as interest expense, net. We recognized a benefit of $6.4 million in interest expense, net for the nine months ended September 30, 2023 related to these excluded components. The cross-currency interest rate swap designated as a net investment hedge is recorded in prepaid expenses and other current assets at a fair value of $6.9 million as of September 30, 2023.

Stock Repurchase Program

On February 4, 2016, we announced that our Board ~~of Directors~~ approved a stock repurchase program ~~(the~~(as updated from time to time, the "Program") ~~under which we may purchase up~~authorizing us to ~~an aggregate of $500 million of~~repurchase our common stock ~~over~~from time to time until February 1, 2024. On October 25, 2022, we announced the ~~following 18 month period. On July 27, 2017, our~~ Board ~~of Directors authorized an increase in~~increased the aggregate size of the Program by ~~an additional $250 million and an extension~~$1.0 billion to $7.1 billion. Since the beginning of the Program bythrough September 30, 2023, 28,314,820 shares have been repurchased for an ~~additional 18 months. On November 1, 2017, we announced that our Board~~aggregate purchase price of ~~Directors had authorized an increase in the size~~$6.4 billion, leaving us up to $0.7 billion of ~~the Program by an additional $350 million, resulting in total aggregate repurchases authorized~~remaining authorization available under the Program ~~of $1.1 billion. With the increase and giving effect to our $590 million of previous~~for future repurchases ~~we may repurchase up to $510 million~~ in shares of our common stock.

On August 18, 2023, as part of the Program, we entered an accelerated share repurchase ("ASR') agreement ("2023 ASR Agreement") with a third-party financial institution to repurchase $450 million of its common stock. Pursuant to the 2023 ASR Agreement, we delivered $450 million in cash and received 1,372,841 shares based on a stock price of $262.23 on August 18, 2023. The 2023 ASR Agreement was completed on September 26, 2023, at ~~any~~which time ~~prior to February 1, 2019.~~we received 293,588 additional shares based on a final weighted average per share purchase price during the repurchase period of $270.04.

Any stock repurchases may be made at times and in such amounts as deemed appropriate. The timing and amount of stock repurchases, if any, will depend on a variety of factors including the stock price, market conditions, corporate and regulatory requirements, and any additional constraints related to material inside information ~~the Company~~we may possess. Any repurchases have been and are expected to be funded by a combination of available cash flow from the business, working capital and debt. .

On August 3, 2017, as part of the Program, we entered an Accelerated Share Repurchase agreement ("ASR Agreement") with a third-party financial institution to repurchase $250 million of its common stock. Pursuant to the ASR Agreement, we delivered $250 million in cash and received 1,491,647 shares based on a stock price of $142.46 on August 7, 2017. The ASR Agreement completed on September 7, 2017, at which time we received 263,012 additional shares based on a final weighted average per share purchase price during the repurchase period of $142.48.

We accounted for the ASR Agreement as two separate transactions: (i) as shares of reacquired common stock for the shares delivered to us upon effectiveness of the ASR Agreement and (ii) as a forward contract indexed to our common stock for the undelivered shares. The initial delivery of shares was included in treasury stock at cost and results in an immediate reduction of the outstanding shares used to calculate the weighted average common shares outstanding for basic and diluted earnings per share. The forward contracts indexed to our own common stock met the criteria for equity classification, were initially recorded in additional paid-in capital and then reclassified to treasury stock upon completion of the ASR agreement.

Since the beginning of the Program, 4,114,104 shares for an aggregate purchase price of $590 million have been repurchased. There were 2,854,959 shares totaling $402.4 million repurchased under the Program during the nine months ended September 30, 2017.

~~Sale of NexTraq~~

As part of our plan to exit the telematics business, on July 27, 2017, we sold NexTraq, a U.S. fleet telematics business, to Michelin Group for $316 million. We recorded a pre-tax gain on the disposal of NexTraq of $175 million during the third quarter of 2017, which is net of transaction closing costs.We recorded tax on the gain of disposal of $65.8 million. The gain on the disposal is included in other (income) expense, net in the accompanying Unaudited Consolidated Statements of Income. NexTraq has historically been included in the Company's North America segment.

Critical accounting policies and estimates

In applying the accounting policies that we use to prepare our consolidated financial statements, we necessarily make accounting estimates that affect our reported amounts of assets, liabilities, ~~revenue~~revenues and expenses. Some of these estimates require us to make assumptions about matters that are highly uncertain at the time we make the accounting estimates. We base these assumptions and the resulting estimates on historical information and other factors that we believe to be reasonable under the circumstances, and we evaluate these assumptions and estimates on an ongoing basis. In many instances, however, we reasonably could have used different accounting estimates and, in other instances, changes in our accounting estimates could occur from period to period, with the result in each case being a material change in the financial statement presentation of our financial condition or results of operations. We refer to estimates of this type as critical accounting estimates.

Accounting estimates necessarily require subjective determinations about future events and conditions. During the ~~nine~~three months ended September 30, ~~2017, other than noted in footnote 1, "Summary of Significant Accounting Policies",~~2023, we have not adopted any new critical accounting policies that had a significant impact upon our consolidated financial statements, have not changed any critical accounting policies and have not changed the application of any critical accounting policies from the year ended December 31, ~~2016.~~2022. For critical accounting policies, refer to the Critical Accounting Estimates in Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2022 and our summary of significant accounting policies in Note 1 of our ~~notes~~Notes to the ~~unaudited consolidated financial statements~~Unaudited Consolidated Financial Statements in this Quarterly Report on Form 10-Q.

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Management’s Use of Non-GAAP Financial Measures

We have included in the discussion above certain financial measures that were not prepared in accordance with GAAP. Any analysis of non-GAAP financial measures should be used only in conjunction with results presented in accordance with GAAP.

Below, we define the non-GAAP financial measures, provide a reconciliation of ~~the~~each non-GAAP financial measure to the most directly comparable financial measure calculated in accordance with GAAP, and discuss the reasons that we believe this information is useful to management and may be useful to investors.

~~Adjusted revenues~~

~~We have defined~~ Because our non-GAAP financial measures are not standardized measures, they may not be directly comparable with the non-GAAP financial measures of other companies using the same or similar non-GAAP financial measures. Although management uses these non-GAAP measures to set goals and measure performance, they have no standardized meaning prescribed by GAAP. These non-GAAP measures are presented solely to permit investors to more fully understand how our management assesses underlying performance. These non-GAAP measures are not, and should not be viewed as, a substitute for GAAP measures, and should be viewed in conjunction with our GAAP financial statements and financial measures. As a result, such non-GAAP measures have limits in their usefulness to investors.

Organic Revenues, net by KPI. Organic revenue growth is calculated as revenue in the current period adjusted ~~revenues~~for the impact of changes in the macroeconomic environment (to include fuel price, fuel price spreads and changes in foreign exchange rates) over revenue in the comparable prior period adjusted to include or remove the impact of acquisitions and/or divestitures and non-recurring items that have occurred subsequent to that period.We define the pro forma and macro adjusted revenue as ~~revenues,~~revenue, net ~~less merchant commissions~~ as reflected in our statement of income, ~~statement.~~

adjusted to eliminate the impact of the macroeconomic environment and the impact of acquisitions and dispositions. The macroeconomic environment impact includes the impact that market fuel price spreads, fuel prices and foreign exchange rates have on our business. We use pro forma and macro adjusted ~~revenues as a basis~~revenue and transactions to evaluate ~~our revenues, net of~~ the ~~commissions that are paid to merchants to participate~~organic growth in our ~~card programs. The commissions paid to merchants can vary when market spreads fluctuate in much~~revenue and the ~~same way as revenues are impacted when market spreads fluctuate.~~associated transactions. We believe that ~~adjusted~~organic revenue growth is ~~an appropriate supplemental measure of financial performance and may be~~ useful to investors tofor understanding ~~our revenue~~the performance ~~on a consistent basis. Adjusted revenues are not intended to be a substitute for GAAP financial measures and should not be used as such.~~of FLEETCOR.

Set forth below is a reconciliation of pro forma and macro adjusted ~~revenues~~revenue and key performance metric by segment, used to calculate organic revenue growth, to the most directly comparable GAAP measure, ~~revenues,~~revenue, net and key performance metric (in ~~thousands)~~millions):*


	Revenues, net				Key Performance Metric
	Three Months Ended September 30,				Three Months Ended September 30,
(Unaudited)	2023		2022		2023		2022
FLEET - TRANSACTIONS
Pro forma and macro adjusted	$	396.7	$	381.1	122.0		124.1
Impact of acquisitions/dispositions	—		14.1		—		(0.7)
Impact of fuel prices/spread	(34.4)		—		—		—
Impact of foreign exchange rates	3.2		—		—		—
As reported	$	365.5	$	395.2	122.0		123.4






CORPORATE PAYMENTS - SPEND
Pro forma and macro adjusted	$	256.8	$	213.7	$	39,446	$	32,828
Impact of acquisitions/dispositions	—		(16.8)		—		(2,219)
Impact of fuel prices/spread	(0.2)		—		—		—
Impact of foreign exchange rates	2.2		—		—		—
As reported	$	258.8	$	196.9	$	39,446	$	30,609
BRAZIL - TAGS
Pro forma and macro adjusted	$	126.0	$	108.6	6.7		6.2
Impact of acquisitions/dispositions	—		—		—		—
Impact of fuel prices/spread	(1.0)		—		—		—
Impact of foreign exchange rates	9.1		—		—		—
As reported	$	134.2	$	108.6	6.7		6.2
LODGING - ROOM NIGHTS
Pro forma and macro adjusted	$	141.0	$	128.6	9.2		10.0
Impact of acquisitions/dispositions	—		(2.6)		—		(0.2)
Impact of fuel prices/spread	—		—		—		—
Impact of foreign exchange rates	0.4		—		—		—
As reported	$	141.4	$	126.0	9.2		9.9
OTHER1- TRANSACTIONS
Pro forma and macro adjusted	$	70.5	$	66.3	296.6		249.4
Impact of acquisitions/dispositions	—		—		—		—
Impact of fuel prices/spread	—		—		—		—
Impact of foreign exchange rates	0.5		—		—		—
As reported	$	71.0	$	66.3	296.6		249.4

FLEETCOR CONSOLIDATED REVENUES, NET
Pro forma and macro adjusted	$	991.1	$	898.3	Intentionally Left Blank
Impact of acquisitions/dispositions	—		(5.3)
Impact of fuel prices/spread2	(35.6)		—
Impact of foreign exchange rates2	15.4		—
As reported	$	970.9	$	893.0

* Columns may not calculate due to rounding.
1 Other includes Gift and Payroll Card operating segments.
2 Revenues reflect an estimated $23 million and $12 million negative impact from fuel price spreads and fuel prices, respectively, partially offset by the positive impact of movements in foreign exchange rates of approximately $15 million.

Three Months Ended September 30, Nine Months Ended September 30,
(Unaudited) 2017 2016 2017 2016
Revenues, net $ 577,877
$ 484,426
$ 1,639,547
$ 1,316,593
Merchant commissions (27,687 ) (28,214 ) (82,690 ) (78,755 )
Total adjusted revenues $ 550,190

$ 456,212

$ 1,556,857

$ 1,237,838

Adjusted net income and adjusted net income per diluted ~~share~~

share. We have defined the non-GAAP measure adjusted net income as net income as reflected in our statement of income, adjusted to eliminate (a) non-cash stock based compensation expense related to share based compensation awards, (b) amortization of deferred financing costs, discounts, ~~and~~ intangible assets, ~~(c)~~and amortization of the premium recognized on the purchase of receivables, (c) integration and deal related costs, and (d) ~~our proportionate share~~other non-recurring items, including the impact of ~~amortization of intangible assets at our Masternaut investment, (e) a non-recurring net gain at our Masternaut investment (f) impairment of our Masternaut investment, (g) net gain on disposition~~discrete tax items, the impact of business ~~(h)~~dispositions, impairment charges, asset write-offs, restructuring and related costs, loss on extinguishment of debt, and ~~(i) a non-recurring loss due~~legal settlements and regulatory-related legal fees. We adjust net income for the tax effect of adjustments using our effective income tax rate, exclusive of discrete tax items. We calculate adjusted net income and adjusted net income per diluted share to ~~merger~~eliminate the effect of ~~entities.~~items that we do not consider indicative of our core operating performance.

We have defined the non-GAAP measure adjusted net income per diluted share as the calculation previously noted divided by the weighted average diluted shares outstanding as reflected in our statement of income.

~~We use~~

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Adjusted net income and adjusted net income ~~to eliminate the effect~~per diluted share are supplemental measures of ~~items~~operating performance that we do not ~~consider indicative of our core operating performance.~~represent and should not be considered as an alternative to net income, net income per diluted share or cash flow from operations, as determined by GAAP. We believe it is useful to exclude non-cash ~~stock~~share based compensation expense from adjusted net income because non-cash equity grants made at a certain price and point in time do not necessarily reflect how our business is performing at any particular time and ~~stock~~share based compensation expense is not a key measure of our core operating performance. We also believe that amortization expense can vary substantially from company to company and from period to period depending upon their financing and accounting methods, the fair value and average expected life of their acquired intangible assets, their capital structures and the method by which their assets were ~~acquired. Therefore,~~acquired; therefore, we have excluded amortization expense from our adjusted net income. Integration and deal related costs represent business acquisition transaction costs, professional services fees, short-term retention bonuses and system migration costs, etc., that are not indicative of the performance of the underlying business. We also believe ~~one-time non-recurring~~that certain expenses, discrete tax items, gains ~~losses, and~~on business disposition, impairment charges, asset write-offs, restructuring and related costs, losses on extinguishment of debt, and legal settlements and regulatory-related legal fees do not necessarily reflect how our ~~investment and~~ business is ~~performing.We believe that~~performing. We adjust net income for the tax effect of each of these adjustments using our effective income tax rate during the period, exclusive of discrete tax items.

Management uses adjusted net income, ~~and~~ adjusted net income per diluted share, ~~are appropriate supplemental measures~~organic revenue growth and EBITDA:

•as measurements of ~~financial~~operating performance ~~and may be useful to investors to understanding~~because they assist us in comparing our operating performance on a consistent ~~basis. Adjusted net income~~basis;

•for planning purposes, including the preparation of our internal annual operating budget;

•to allocate resources to enhance the financial performance of our business; and ~~adjusted net income per diluted share are not intended~~

•to ~~be a substitute for GAAP financial measures~~evaluate the performance and ~~should not be used as such.~~effectiveness of our operational strategies.

Set forth below is a reconciliation of adjusted net income and adjusted net income per diluted share to the most directly comparable GAAP measure, net income and net income per diluted share (in thousands, except shares and per share amounts)*:*

Three Months Ended September 30, Nine Months Ended September 30,
(Unaudited) 2017 2016 2017 2016
Net income $ 202,823
$ 129,618
$ 457,503
$ 356,961
Net income per diluted share 2.18
1.36
4.87
3.75
Stock based compensation 24,654
17,405
68,897
50,025
Amortization of intangible assets 54,003
46,341
158,897
112,455
Amortization of premium on receivables 1,650
1,348
4,738
3,687
Amortization of deferred financing costs and discounts 1,611
1,917
5,411
5,568
Amortization of intangibles at Masternaut investment 2,965
2,406
8,341
7,533
Impairment of Masternaut investment 44,600
—
44,600
—
Net gain on disposition of business (109,205 ) —
(109,205 ) —
Loss on extinguishment of debt 3,296
—
3,296
—
Non recurring loss due to merger of entities 2,028
—
2,028
—
Non-recurring net gain at Masternaut investment —
—
—
(10,845 )
Total pre-tax adjustments 25,602

69,417
187,003

168,423
Income tax impact of pre-tax adjustments at the effective tax rate¹
(25,656 ) (15,726 ) (69,711 ) (46,425 )
Adjusted net income $ 202,769
$ 183,310
$ 574,795
$ 478,959
Adjusted net income per diluted share $ 2.18
$ 1.92
$ 6.12
$ 5.03
Diluted shares 93,001
95,307
93,923
95,204


	Three Months Ended September 30,				Nine Months Ended September 30,
(Unaudited)	2023		2022		2023		2022
Net income	$	271,496	$	248,885	$	726,033	$	729,008
Net income per diluted share	$	3.64	$	3.29	$	9.72	$	9.38
Stock-based compensation	29,073		34,180		89,917		100,828
Amortization1	58,304		55,748		176,047		171,372
Integration and deal related costs	9,269		4,861		24,734		14,071
Legal settlements/litigation	1,473		2,783		1,957		4,685
Restructuring, related and other2 costs	2,314		507		3,017		1,270
Gain on disposition of business	(13,712)		—		(13,712)		—


Loss on extinguishment of debt	—		—		—		1,934

Total pre-tax adjustments	86,721		98,079		281,960		294,160
Income taxes	(23,104)		(26,262)		(75,540)		(86,667)

Adjusted net income	$	335,113	$	320,702	$	932,453	$	936,501
Adjusted net income per diluted share	$	4.49	$	4.24	$	12.48	$	12.06
Diluted shares	74,604		75,558		74,733		77,687


1 Includes amortization related to intangible assets, premium on receivables, deferred financing costs and debt discounts.
2 Includes impact of foreign currency transactions; prior amounts were not material for recast ($1.9 million) and ($4.1 million) for the quarter and year to date, respectively.
*Columns may not calculate due to ~~impact of~~ rounding.
¹Excludes the results of our Masternaut investment on our effective tax rate, as results from our Masternaut investment are reported within the Consolidated Income Statements on a post-tax basis and no tax-over-book outside basis differences related to our investment reversed during 2016 or are expected to reverse in 2017. Also excludes the net gain realized upon our disposition of NexTraq, representing a pretax gain of $175.0 and tax on gain of $65.8. The tax on the gain is included in "Net gain on disposition of business".

~~Pro Forma~~EBITDA and ~~Macro Adjusted Revenue~~EBITDA margin. EBITDA is defined as earnings before interest, income taxes, interest expense, net, other expense (income), depreciation and ~~Transactions by Product~~amortization, loss on extinguishment of debt, investment loss/gain and other operating, net.

~~We define pro forma~~The following table reconciles EBITDA and ~~macro adjusted revenue as revenue,~~EBITDA margin to net ~~as reflected in our statement of~~ income adjusted to eliminate the impact of the macroeconomic environment and the impact of acquisitions and dispositions. The macroeconomic environment includes the impact that market fuel spread margins, fuel prices and foreign exchange rates have on our business. We use pro forma and macro adjusted revenue and transactions to evaluate the organic growth in our revenue and the associated transactions. Set forth below is a reconciliation of pro forma and macro adjusted revenue and transactions to the most directly comparable GAAP measure, revenue, net and transactions (in millions)*:*


	Three Months Ended September 30,						Nine Months Ended September 30,
(Unaudited)	2023			2022			2023			2022
Net income	$	271.5		$	248.9		$	726.0		$	729.0
Provision for income taxes	98.6			91.0			265.5			249.2
Interest expense, net	88.3			45.4			256.6			90.5
Other (income) expense	(13.4)			3.7			(15.1)			6.2
Investment loss (gain)	—			0.2			(0.1)			0.5
Depreciation and amortization	84.8			77.2			252.7			232.5
Loss on extinguishment of debt	—			—			—			1.9
Other operating, net	(0.8)			—			0.6			0.1
EBITDA	$	528.9		$	466.4		$	1,486.1		$	1,309.9

Revenues, net	$	970.9		$	893.0		$	2,820.4		$	2,543.5
EBITDA margin	54.5		%	52.2		%	52.7		%	51.5		%
* Columns may not calculate due to rounding.

Revenue Transactions
Three Months Ended September 30, Three Months Ended September 30,
(Unaudited) 2017 2016 2017
2016⁴
FUEL CARDS
Pro forma and macro adjusted^2,3
$ 274.0
$ 259.5
$ 119.6
$ 113.6
Impact of acquisitions/dispositions —
(0.7 ) —
(1.0 )
Impact of fuel prices/spread (0.6 ) —
—
—
Impact of foreign exchange rates 2.9
—
—
—
As reported $ 276.3
$ 258.8
$ 119.6
$ 112.5
CORPORATE PAYMENTS
Pro forma and macro adjusted^2,3
$ 71.7
$ 61.3
$ 10.9
$ 10.2
Impact of acquisitions/dispositions —
(15.2 ) —
(0.2 )
Impact of fuel prices/spread 0.1
—
—
—
Impact of foreign exchange rates 0.4
—
—
—
As reported $ 72.2
$ 46.1
$ 10.9
$ 10.0
TOLLS
Pro forma and macro adjusted^2,3
$ 80.8
$ 67.8
$ 231.0
$ 225.0
Impact of acquisitions/dispositions —
(42.0 ) —
(143.9 )
Impact of fuel prices/spread —
—
—
—
Impact of foreign exchange rates 2.1
—
—
—
As reported $ 82.9
$ 25.8
$ 231.0
$ 81.1
LODGING
Pro forma and macro adjusted^2,3
$ 33.2
$ 28.1
$ 4.1
$ 3.5
Impact of acquisitions/dispositions —
—
—
—
Impact of fuel prices/spread —
—
—
—
Impact of foreign exchange rates —
—
—
—
As reported $ 33.2
$ 28.1
$ 4.1
$ 3.5
GIFT
Pro forma and macro adjusted^2,3
$ 54.8
$ 58.3
$ 294.1
$ 269.5
Impact of acquisitions/dispositions —
—
—
—
Impact of fuel prices/spread —
—
—
—
Impact of foreign exchange rates —
—
—
—
As reported $ 54.8
$ 58.3
$ 294.1
$ 269.5
OTHER¹

Pro forma and macro adjusted^2,3
$ 58.1
$ 57.1
$ 19.4
$ 20.4
Impact of acquisitions/dispositions —
10.3
—
0.4
Impact of fuel prices/spread —
—
—
—
Impact of foreign exchange rates 0.4
—
—
—
As reported $ 58.5
$ 67.4
$ 19.4
$ 20.8

FLEETCOR CONSOLIDATED REVENUES
Pro forma and macro adjusted^2,3
$ 572.6
$ 532.1
$ 679.1
$ 642.2
Impact of acquisitions/dispositions —
(47.6 ) —
(144.7 )
Impact of fuel prices/spread (0.5 ) —
—
—
Impact of foreign exchange rates 5.8
—
—
—
As reported $ 577.9
$ 484.4
$ 679.1
$ 497.5

* Columns may not calculate due to impact of rounding.
¹Other includes telematics, maintenance, food and transportation related businesses.

²2016 is pro forma to include acquisitions and exclude dispositions, consistent with 2017 ownership.
³2017 is adjusted to remove the impact of changes in the macroeconomic environment to be consistent with the same period of prior year, using constant fuel prices, fuel price spreads and foreign exchange rates.
⁴2016 transactions reflect immaterial corrections from previously disclosed amounts for the prior period.

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Special Cautionary Notice Regarding Forward-Looking Statements

This ~~report~~Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws. Statements that are not historical facts, including statements about ~~FleetCor's~~FLEETCOR’s beliefs, expectations and future performance, are forward-looking statements. Forward-looking statements can be identified by the use of words such as ~~“anticipate,” “intend,” “believe,” “estimate,” “plan,” “seek,” “project”~~"anticipate," "intend," "believe," "estimate," "plan," "seek," "project" or ~~“expect,” “may,” “will,” “would,” “could”~~"expect," "may," "will," "would," "could" or ~~“should,”~~"should," the negative of these terms or other comparable terminology.

These forward-looking statements are not a guarantee of performance, and you should not place undue reliance on such statements. We have based these forward-looking statements largely on our current expectations and projections about future events. Forward-looking statements are subject to many uncertainties and other variable circumstances, ~~such as delays or failures associated with implementation; fuel price and spread volatility; changes~~including those discussed in credit risk of customers and associated losses; the actions of regulators relating to payment cards or investigations; failure to maintain or renew key business relationships; failure to maintain competitive offerings; failure to maintain or renew sources of financing; failure to complete, or delays in completing, anticipated new partnership arrangements or acquisitions and the failure to successfully integrate or otherwise achieve anticipated benefits from such partnerships or acquired businesses; failure to successfully expand business internationally; other risks related to our international operations, including the potential impact to our business as a result of the United Kingdom's referendum to leave the European Union; the impact of foreign exchange rates on operations, revenue and income; the effects of general economic and political conditions on fueling patterns and the commercial activity of fleets, risks related to litigation; our ability to complete an accelerated share repurchase, as well as the other risks and uncertainties identified under the caption “Risk Factors”"Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, ~~2016, and 10-Q for the quarter ended June 30, 2017~~2022 filed with the Securities and Exchange Commission on ~~March 1, 2017 and August 8, 2017, respectively. These factors~~February 28, 2023, many of which are outside of our control, that could cause our actual results and experience to differ materially from any forward-looking statement.

Forward-looking statements may not be realized due to a variety of factors, including, without limitation:

•our ability to successfully execute our strategic plan and portfolio review, manage our growth and achieve our performance targets;

•regulatory measures, voluntary actions, or changes in consumer preferences, that impact our transaction volume;

•adverse changes in program fees or charges we may collect, whether through legal, regulatory or contractual changes;

•the impact of macroeconomic conditions and the current inflationary environment and whether expected trends, including retail fuel prices, fuel price spreads, fuel transaction patterns, electric vehicle, and retail lodging price trends develop as anticipated and we are able to develop successful strategies in light of these trends;

•the international operational and political risks and compliance and regulatory risks and costs associated with international operations, including the impact of the global military conflicts between Russia and Ukraine and in the Middle East, on our business and operations;

•our ability to attract new and retain existing partners, fuel merchants, and lodging providers, their promotion and support of our products, and their financial performance;

•the failure of management assumptions and estimates, as well as differences in, and changes to, economic, market, interest rate, interchange fees, foreign exchange rates, and credit conditions, including changes in borrowers’ credit risks and payment behaviors;

•the risk of higher borrowing costs and adverse financial market conditions impacting our funding and liquidity, and any reduction in our credit ratings;

•our ability to successfully manage our credit risks and the sufficiency of our allowance for expected credit losses;

•our ability to securitize our trade receivables;

•the occurrence of fraudulent activity, data breaches or failures of our information security controls or cybersecurity-related incidents that may compromise our systems or customers’ information;

•any disruptions in the operations of our computer systems and data centers;

•our ability to develop and implement new technology, products, and services;

•any alleged infringement of intellectual property rights of others and our ability to protect our intellectual property;

•the regulation, supervision, and examination of our business by foreign and domestic governmental authorities, as well as litigation and regulatory actions, including the lawsuit filed by the Federal Trade Commission (FTC);

•the impact of regulations relating to privacy, information security and data protection; use of third-party vendors and ongoing third-party business relationships; and failure to comply with anti-money laundering (AML) and anti-terrorism financing laws;

•changes in our senior management team and our ability to attract, motivate and retain qualified personnel consistent with our strategic plan;

•tax legislation initiatives or challenges to our tax positions and/or interpretations, and state sales tax rules and regulations;

•the risks of mergers, acquisitions and divestitures, including, without limitation, the related time and costs of implementing such transactions, integrating operations as part of these transactions and possible failures to achieve expected gains, revenue growth and/or expense savings from such transactions; and

•the other factors and information in our Annual Report on Form 10-K and other filings that we make with the Securities and Exchange Commission (SEC) under the Exchange Act and Securities Act. See "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission on February 28, 2023.

Given these risks and uncertainties, you are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements included in this report are made only as of the date hereof. We do not undertake, and specifically disclaim, any obligation to update any such statements or to publicly announce the results of any revisions to any of such statements to reflect future events or developments.

You may get FLEETCOR’s SEC filings for free by visiting the SEC web site at www.sec.gov.

This report includes non-GAAP financial measures, which are used by FLEETCOR and investors as supplemental measures to evaluate the overall operating performance of companies in our industry. By providing these non-GAAP financial measures, together with reconciliations, we believe we are enhancing investors' understanding of our business and our results of operations, as well as assisting investors in evaluating how well we are executing strategic initiatives. See "Management’s Use of Non-GAAP Financial Measures" elsewhere in this Quarterly Report on Form 10-Q for additional information regarding these GAAP financial measures and a reconciliation to the nearest corresponding GAAP measure.



Item 3.			Quantitative and Qualitative Disclosures About Market Risk

With the acquisition of Cambridge in August 2017, we have additional foreign exchange risk and associated foreign exchange risk management requirements due to the nature of our international payments provider business. The majority of this business' revenue is from exchanges of currency at spot rates, which enable customers to make cross-currency payments. In addition, this business also writes foreign currency forward and option contracts for our customers to facilitate future payments. The duration of these derivative contracts at inception is generally less than one year. Cambridge aggregates its foreign exchange exposures arising from customer contracts, including the derivative contracts described above, and hedges (economic hedge) the resulting net currency risks by entering into offsetting contracts with established financial institution counterparties.

A hypothetical uniform 10% strengthening or weakening in the value of the U.S. dollar relative to all other currencies in which our net income is generated would have resulted in a decrease/increase to pre-tax income of approximately $1.5 million based on our unhedged exposure to foreign currency at September 30, 2017.

As of September 30, ~~2017, other than noted above,~~2023, there have been no material changes to our market risk from that disclosed in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2022.



Item 4.			Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As of September 30, ~~2017,~~2023, management carried out, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934). Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of September 30, ~~2017,~~2023, our disclosure controls and procedures were effective in ensuring that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in applicable rules and forms and are designed to ensure that information required to be disclosed in those reports is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended September 30, ~~2017,~~2023, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Table of Contents

PART II—OTHER INFORMATION



Item 1.			Legal Proceedings

In the ordinary course of business, ~~we are subject to~~the Company is involved in various pending ~~and potential~~or threatened legal actions, arbitration proceedings, claims, subpoenas, and matters relating to compliance with laws and regulations (collectively, ~~legal proceedings)~~"legal proceedings"). Based on our current knowledge, management presently does not believe that the liabilities arising from these legal proceedings will have a material adverse effect on our consolidated financial condition, results of operations or cash flows. However, it is possible that the ultimate resolution of these legal proceedings could have a material adverse effect on our results of operations and financial condition for any particular period.

~~Shareholder Class Action and~~ Derivative Lawsuits

On January 20, 2023, the previous State Derivative Action plaintiffs filed a new derivative lawsuit in the Superior Court of Gwinnett County, Georgia. The new lawsuit, City of Aventura Police Officers’ Retirement Fund, derivatively on behalf of ~~the Company. The derivative complaint~~FleetCor Technologies, Inc. v. Ronald F. Clarke and Eric R. Dey, alleges that the ~~defendants issued a false and misleading proxy statement in violation of the federal securities laws; that~~ defendants breached their fiduciary duties by causing or permitting the Company to ~~make allegedly~~engage in unfair or deceptive marketing and billing practices, making false and misleading public statements concerning the Company’s fee charges and financial and business ~~prospects;~~prospects, and ~~that certain defendants breached their fiduciary duties through allegedly~~making improper sales of stock. The complaint seeks ~~unspecified~~approximately $118 million in monetary damages on behalf of the Company, ~~corporate governance reforms,~~including contribution by defendants as joint tortfeasors with the Company in unfair and deceptive practices, and disgorgement of ~~profits, benefits~~incentive pay and ~~compensation by~~stock compensation. On January 24, 2023, the ~~defendants, restitution, costs,~~previous Federal Derivative Action plaintiffs filed a similar new derivative lawsuit, Jerrell Whitten, derivatively on behalf of FleetCor Technologies, Inc. v. Ronald F. Clarke and ~~attorneys’~~Eric R. Dey, against Mr. Clarke and experts’ fees. On August 18, 2017, the court entered an order deferring the case pending a ruling on the defendants' motion to dismiss the putative shareholder class action, or until otherwise agreed to by the parties.Mr. Dey in Gwinnett County, Georgia. The defendants dispute the allegations in the ~~complaint~~derivative complaints and intend to vigorously defend against the claims.

FTC Investigation

In October 2017, the Federal Trade Commission ("FTC") issued a Notice of Civil Investigative Demand to the Company for the production of documentation and a request for responses to written interrogatories. After discussions with the Company, the FTC proposed in October 2019 to resolve potential claims relating to the Company’s advertising and marketing practices, principally in its U.S. direct fuel card business within its North American Fuel Card business. The parties reached impasse primarily related to what the Company believes are unreasonable demands for redress made by the FTC. On December 20, 2019, the FTC filed a lawsuit in the Northern District of Georgia against the Company and Ron Clarke. See FTC v. FLEETCOR and Ronald F. Clarke, No. 19-cv-05727 (N.D. Ga.). The complaint alleges the Company and Clarke violated the FTC Act’s prohibitions on unfair and deceptive acts and practices. The complaint seeks among other things injunctive relief, consumer redress, and costs of suit. The Company continues to believe that the FTC’s claims are without merit and these matters are not and will not be material to the Company’s financial performance. On April 17, 2021, the FTC filed a motion for summary judgment. On April 22, 2021, the United States Supreme Court held unanimously in AMG Capital Management v. FTC that the FTC does not have authority under current law to seek monetary redress by means of Section 13(b) of the FTC Act, which is the means by which the FTC has sought such redress in this case. FLEETCOR cross-moved for summary judgment regarding the FTC’s ability to seek monetary or injunctive relief on May 17, 2021. On August 13, 2021, the FTC filed a motion to stay or to voluntarily dismiss without prejudice the case pending in the Northern District of Georgia in favor of a parallel administrative action under Section 5 of the FTC Act that it filed on August 11, 2021 in the FTC’s administrative process. Apart from the jurisdiction and statutory change, the FTC’s administrative complaint makes the same factual allegations as the FTC’s original complaint filed in December 2019. The Company opposed the FTC’s motion for a stay or to voluntarily dismiss, and the court denied the FTC’s motion on February 7, 2022. In the meantime, the FTC’s administrative action is stayed. On August 9, 2022, the District Court for the Northern District of Georgia granted the FTC's motion for summary judgment as to liability for the Company and Ron Clarke, but granted the Company's motion for summary judgment as to the FTC's claim for monetary relief as to both the Company and Ron Clarke. The Company intends to appeal this decision after final judgment is issued. On October 20-21, 2022, the court held a hearing on the scope of injunctive relief. At the conclusion of the hearing, the Court did not enter either the FTC’s proposed order or the Company’s proposed order, and instead suggested that the parties enter mediation. Following mediation, both parties have filed proposed orders with the Court.

On June 8, 2023, the Court issued an Order for Permanent Injunction and Other Relief. The Company filed its notice of appeal to the United States Court of Appeals for the Eleventh Circuit on August 3, 2023. On August 17, 2023, the FTC Commission ordered that the stay of the parallel Section 5 administration action will remain in place during the pendency of the Eleventh Circuit appeal. The Company has incurred and continues to incur legal and other fees related to this FTC complaint. Any

settlement of this matter, or defense against the lawsuit, could involve costs to the Company, including legal fees, redress, penalties, and remediation expenses.

Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult and requires an extensive degree of judgment, particularly where, as here, the matters involve indeterminate claims for monetary damages and are in the stages of the proceedings where key factual and legal issues have not been resolved. For these reasons, ~~we are~~the Company is currently unable to predict the ultimate timing or outcome of, or reasonably estimate the possible losses or a range of possible losses resulting from, the matters described above.



Item 1A.			Risk Factors

InThe information presented below supplements the risk factors set forth in our annual report on Form 10-K for the year ended December 31, 2022. In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A. ~~“Risk Factors”~~"Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2022 and in Part II, Item ~~1A.~~1A, "Risk Factors" in ~~our Quarterly Report on Form 10-Q for the quarter ended June 30, 2017 filed~~other reports we file with the Securities and Exchange Commission, ~~on March 1, 2017 and August 8, 2017, respectively,~~from time to time, all of which could materially affect our business, financial condition or future results. ~~Other than the risk factors set forth below, there~~There have been no material changes ~~from the~~in our risk factors ~~previously~~from those disclosed inunder the ~~Company’s Annual Report~~caption "Item 1A. Risk factors" to our annual report on Form 10-K for the year ended December 31, ~~2016.~~2022.

~~Derivatives Regulations~~

Rules adopted under the Dodd-Frank Act by the Commodity Futures Trading Commission (the "CFTC"), as well as the provisions of the European Market Infrastructure Regulation and its technical standards, which are directly applicable in the member states of the European Union, have subjected certain of the foreign exchange derivative contracts we offer to our customers as part of Cambridge's business, to reporting, recordkeeping, and other requirements. Additionally, certain foreign exchange derivatives transactions we may enter into in the future may be subject to centralized clearing requirements, or may be subject to margin requirements in the United States and European Union. Other jurisdictions outside the United States and the European Union are considering, have implemented, or are implementing regulations similar to those described above. Derivatives regulations have added costs to our business and any additional requirements, such as future registration requirements and increased regulation of derivative contracts, may result in additional costs or impact the way we conduct our hedging activities, as well as impact how we

conduct our business within our international payments provider operations. In particular, the CFTC has recently issued a proposed rule that, if adopted as proposed, would increase the likelihood that we will have to register one or more of our subsidiaries with the CFTC as swap dealers. Swap dealers are subject to a comprehensive regulatory framework and compliance with this framework will lead to additional costs, including costs relating to regulatory capital and margin requirements, and may impact how we conduct our hedging activities and derivatives business with customers. We are currently evaluating the impact the proposed rule, if adopted, would have on our hedging activities and operations.

Our compliance with these requirements has resulted, and may continue to result, in additional costs to our business and may impact our international payments provider business operations. Furthermore, our failure to comply with these requirements could result in fines and other sanctions, as well as necessitate a temporary or permanent cessation to some or all of our derivative related activities. Any such fines, sanctions or limitations on our business could adversely affect our operations and financial results. Additionally, the regulatory regimes for derivatives in the United States and European Union, such as under the Dodd-Frank Act and the European Markets in Financial Instruments Directive known as "MiFID II," are continuing to evolve and changes to such regimes, our designation under such regimes, or the implementation of new rules under such regimes, such as future registration requirements and increased regulation of derivative contracts, may result in additional costs to our business. Other jurisdictions outside the United States and the European Union are considering, have implemented, or are implementing regulations similar to those described above and these may result in greater costs to us as well.

Global economic downturns or slower growth or declines in the money transfer, payment service, and other markets in which we operate, including downturns or declines related to interruptions in migration patterns, and difficult conditions in global financial markets and~~financial market disruptions could adversely affect our business, financialcondition, results of operations, and cash flows.~~

~~The global economy has experienced in recent years, and may experience, downturns, volatility and disruption, and we face certain risks relating to such events, including:~~

Our international payments provider business provides currency conversion and foreign exchange hedging services to our customers, exposing us to foreign currency exchange risk. In order to help mitigate these risks, we enter into derivative contracts. However, these contracts do not eliminate all of the risks related to fluctuating foreign currency rates.

Our international payments provider business is heavily dependent on global trade. A downturn in global trade or the failure of long-term import growth rates to return to historic levels could have an adverse effect on our business, financial condition, results of operations, cash flows, and our cash management strategies. Additionally, as customer hedging activity in our international payments provider business generally varies with currency volatility, we have experienced and may experience in the future lower foreign exchange revenues in periods of lower currency volatility.

The counterparties to the derivative financial instruments that we use in our international payments provider business to reduce our exposure to various market risks, including changes in foreign exchange rates, may fail to honor their obligations, which could expose us to risks we had sought to mitigate. This includes the exposure generated when we write derivative contracts to our customers as part of our cross-currency payments business, and we typically hedge the net exposure through offsetting contracts with established financial institution counterparties. That failure could have an adverse effect on our financial condition, results of operations, and cash flows.

~~Risks associated with operations outside the United States and foreign currencies could adversely affect our business, financial condition, results of operations, and cash flows.~~

We have additional foreign exchange risk and associated foreign exchange risk management requirements due to the nature of our international payments provider business. The majority of this business' revenue is from exchanges of currency at spot rates, which enable customers to make cross-currency payments. Additionally, this business also writes foreign currency forward and option contracts for our customers. The duration of these derivative contracts at inception is generally less than one year. The credit risk associated with our derivative contracts increases when foreign currency exchange rates move against our customers, possibly impacting their ability to honor their obligations to deliver currency to us or to maintain appropriate collateral with us.

Our international payments provider business aggregates its foreign exchange exposures arising from customer contracts, including the derivative contracts described above, and hedges the resulting net currency risks by entering into offsetting contracts with established financial institution counterparties. If we are unable to obtain offsetting positions, our business, financial condition, results of operations, and cash flows could be adversely affected.

We face credit, liquidity and fraud risks from our agents, consumers, businesses, and third-party processors that could adversely affect our business, financial condition, results of operations, and cash flows.

We are exposed to credit risk in our international payments provider business relating to: (a) derivatives written by us to our customers and (b) the extension of trade credit when transactions are paid to recipients prior to our receiving cleared funds from the sending customers. The credit risk associated with our derivative contracts increases when foreign currency exchange rates move against our customers, possibly impacting their ability to honor their obligations to deliver currency to us or

to maintain appropriate collateral with us. If a customer becomes insolvent, files for bankruptcy, commits fraud or otherwise fails to pay us, we may be exposed to the value of an offsetting position with a financial institution counterparty for the derivatives or may bear financial risk for those receivables where we have offered trade credit.

If we are unable to maintain our relationships with banks needed to conduct our services, or fail to comply with our contract requirements, our business, financial condition, results of operations, and cash flows would be adversely affected.

In our international payments provider business, we facilitate payment and foreign exchange solutions, primarily cross-border, cross-currency transactions, for small and medium size enterprises and other organizations. Increased regulation and compliance requirements are impacting these businesses by making it more costly for us to provide our services or by making it more cumbersome for businesses to do business with us. We may also have difficulty establishing or maintaining banking relationships needed to conduct our services due to banks’ policies. If we are unable to maintain our current business or banking relationships or establish new relationships under terms consistent with those currently in place, our ability to continue to offer our services may be adversely impacted, which could have an adverse effect on our business, financial condition, results of operations, and cash flows.



Item 2.			Unregistered Sales of Equity Securities, ~~and~~ Use of Proceeds, and Issuer Purchases of Securities

OnThe Company announced on February 4, 2016 ~~our~~that its Board ~~of Directors~~ approved a stock repurchase program ~~(the~~(as updated from time to time, the "Program") ~~under which we may begin purchasing up~~authorizing the Company to ~~an aggregate of $500 million of the Company's~~repurchase its common stock ~~over~~from time to time until February 1, 2024. On October 25, 2022, the ~~following 18 month period. On July 27, 2017,~~Company announced the ~~Company's~~ Board ~~of Directors authorized an increase in~~increased the aggregate size of the Program by an additional $250 million and an extension of the Program by an additional 18 months. On November 1, 2017, the Company announced that its Board of Directors had authorized an increase in the size of the Program by an additional $350 million, resulting in total aggregate repurchases authorized under the Program of $1.1$1.0 billion to $7.1 billion. Since the beginning of the Program ~~4,114,104~~through September 30, 2023, 28,314,820 shares have been repurchased for an aggregate purchase price of ~~$590~~$6.4 billion, leaving the Company up to $0.7 billion of remaining authorization available under the Program for future repurchases in shares of its common stock.

On August 18, 2023, as part of the Program, the Company entered an accelerated share repurchase ("ASR') agreement ("2023 ASR Agreement") with a third-party financial institution to repurchase $450 million ~~have been repurchased.~~of its common stock. Pursuant to the 2023 ASR Agreement, the Company delivered $450 million in cash and received 1,372,841 shares based on a stock price of $262.23 on August 18, 2023. The 2023 ASR Agreement was completed on September 26, 2023, at which time the Company received 293,588 additional shares based on a final weighted average per share purchase price during the repurchase period of $270.04.

The following table presents information as of September 30, 2023, with respect to purchases of common stock of the Company made during the three months ended September 30, ~~2017~~2023 by the Company as defined in Rule 10b-18(a)(3) under the Exchange ~~Act:~~Act.


Period	Total Number of Shares Purchased1	Average Price Paid Per Share		Total Number of Shares Purchased as Part of the Publicly Announced Plan	Maximum Value that May Yet be Purchased Under the Publicly Announced Plan (in thousands)
July 1, 2023 through July 31, 2023	2,205	$	252.53	—
August 1, 2023 through August 31, 2023	1,676,985	$	268.90	1,675,905
September 1, 2023 through September 30, 2023	296,726	$	270.06	293,588	$	702,117


1 During the quarter ended September 30, 2023, pursuant to our Stock Incentive Plan, we withheld 6,423 shares, at an average price per share of $258.10, in order to satisfy employees' tax withholding obligations in connection with the vesting of awards of restricted stock.

Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of the Publicly Announced Plan Maximum Value that May Yet be Purchased Under the Publicly Announced Plan (in thousands)
August 1, 2017 through August 31, 2017 1,491,647
$ 142.46
3,161,958
$ 647,430
September 1, 2017 through September 30, 2017 952,146
$ 144.38
4,114,104
$ 509,957



Item 3.			Defaults Upon Senior Securities

Not applicable.



Item 4.			Mine Safety Disclosures

Not applicable.



Item 5.			Other Information

~~Not applicable.~~Rule 10b5-1 Trading Plans

Table of Contents

During the period covered by this Quarterly Report on Form 10-Q, no director or executive officer of the Company adopted, modified or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.”

Item 6. Exhibits




Exhibit No.
~~2.1~~3.1		~~Acquisition agreement to acquire Serviços e Tecnologia de Pagamentos S.A.~~FLEETCOR Technologies, Inc. Amended and Restated Bylaws, adopted June 9, 2022 (incorporated by reference to Exhibit ~~2.1~~3.2 to the ~~Registrant's~~Registrant’s Current Report on Form 8-K, File No. 001-35004, filed with the ~~Securities and Exchange Commission ("SEC")~~SEC on ~~March 18, 2016)~~June 14, 2022)

~~3.1~~10.1		~~Amended~~Cooperation Agreement, dated as of March 15, 2023, by and ~~Restated Certificate of Incorporation of FleetCor~~among FLEETCOR Technologies, Inc., D.E. Shaw Oculus Portfolios, L.L.C. and D.E. Shaw Valence Portfolios, L.L.C. (incorporated by reference to Exhibit ~~3.1~~10.1 to the Registrant’s ~~Annual~~Current Report on Form ~~10-K,~~8-K, File No. 001-35004, filed with the SEC on March ~~25, 2011)~~20, 2023)

~~3.2~~10.2		~~Amended and Restated Bylaws of FleetCor~~Offer letter, dated February 24, 2023, between FLEETCOR Technologies, Inc. and Tom Panther (incorporated by reference to Exhibit ~~3.2~~10.2 to the Registrant’s ~~Annual Report on Form 10-K, File No. 001-35004, filed with the SEC on October 28, 2016)~~

~~4.1~~	Form of Stock Certificate for Common Stock (incorporated by reference to Exhibit 4.1 to Amendment No. 3 to the Registrant’s Registration Statement on Form S-1, File No. 333-166092, filed with the SEC on June 29, 2010)

~~10.1~~	Third Amendment to Credit Agreement, date as of August 2, 2017, among FleetCor Technologies Operating Company, LLC, as the Company, FleetCor Technologies, Inc., as the Parent, the designated borrowers party hereto, the other guarantors party hereto, Bank of America, N.A., as administrative agent, swing line lender and l/c issuer, and the other lenders party hereto Merrill Lynch, Pierce, Fenner & Smith Incorporated, as sole lead arranger and sole book runner (incorporated by reference to Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q, File No. 001-35004, filed with the SEC on ~~August 8, 2017)~~May 10, 2023)

10.3		Thirteenth Amendment to the Credit Agreement, dated as of May 3, 2023 among FLEETCOR Technologies Operating Company, LLC, as the Company, FLEETCOR Technologies, Inc., as the Parent, Cambridge Mercantile Corp. (USA) as the additional borrower, Bank of America, N.A., as administrative agent, a domestic swing line lender, the foreign swing line lender and the L/C issuer, and the other lenders party hereto (incorporated by reference to Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q, File No. 001-35004, filed with the SEC on May 10, 2023)

31.1*		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and rule 15d-14(a) of the Securities Exchange Act, as amended

31.2*		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and rule 15d-14(a) of the Securities Exchange Act, as amended

32.1*		Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of ~~2001~~2002

32.2*		Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of ~~2001~~2002

~~101~~101*		The following financial information for the Registrant formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Unaudited Consolidated Statements of Income, (iii) the Unaudited Consolidated Statements of Comprehensive Income; (iv) the Unaudited Consolidated Statements of Cash Flows and (v) the Notes to Unaudited Consolidated Financial Statements

104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

*Filed Herein

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned; thereunto duly authorized, in their capacities indicated on November 9, ~~2017.~~2023.

FLEETCOR Technologies, Inc.

~~FleetCor Technologies, Inc.~~(Registrant)

~~(Registrant)~~

Signature

Title

~~Signature~~

~~Title~~

/s/ Ronald F. Clarke

President, Chief Executive Officer and Chairman of the Board of Directors (Duly Authorized Officer and Principal

Executive Officer)

Ronald F. Clarke

/s/ ~~Eric R. Dey~~Tom Panther

Chief Financial Officer (Principal Financial ~~Officer and Principal Accounting~~ Officer)

~~Eric R. Dey~~Tom Panther



Delaware			72-1074903
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

~~5445 Triangle Parkway,~~3280 Peachtree ~~Corners, Georgia~~Road, Suite 2400	Atlanta	~~30092~~Georgia	30305
(Address of principal executive offices)			(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	FLT	NYSE



Large accelerated filer	ý☒	Accelerated filer	¨☐
Non-accelerated filer	¨ ~~(Do not check if a smaller reporting company)~~ ☐	Smaller reporting company	¨☐
Emerging growth company	¨ ☐



Class						Outstanding at ~~October 31, 2017~~November 2, 2023
Common Stock, $0.001 par value						~~89,560,788~~72,204,127


					Page
PART I—FINANCIAL INFORMATION

Item 1.			FINANCIAL STATEMENTS

				~~Page~~
~~PART I—FINANCIAL INFORMATION~~

~~Item 1.~~	~~FINANCIAL STATEMENTS~~

	Consolidated Balance Sheets at September 30, ~~2017~~2023 (unaudited) and December 31, ~~2016~~2022	1

			Unaudited Consolidated Statements of Income for the Three and Nine Months Ended September 30, ~~2017~~2023 and ~~2016~~2022		2

			Unaudited Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, ~~2017~~2023 and ~~2016~~2022		3

			Unaudited Consolidated Statements of Stockholders' Equity for the Three and Nine Months Ended September 30, 2023 and 2022		4

			Unaudited Statements of Cash Flows for the Nine Months EndedSeptember 30, ~~2017~~2023 and ~~2016~~2022		46

			Notes to Unaudited Consolidated Financial Statements		67

Item 2.			MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		2124

Item 3.			QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		4446

Item 4.			CONTROLS AND PROCEDURES		4446

PART II—OTHER INFORMATION

Item 1.			LEGAL PROCEEDINGS		4547

Item 1A.			RISK FACTORS		4548

Item 2.			UNREGISTERED SALES OF EQUITY SECURITIES, ~~AND~~ USE OF PROCEEDS AND ISSUER PURCHASE OF EQUITY SECURITIES		4748

Item 3.			DEFAULTS UPON SENIOR SECURITIES		4748

Item 4.			MINE SAFETY DISCLOSURES		4748

Item 5.			OTHER INFORMATION		4748

Item 6.			EXHIBITS		4850

SIGNATURES					4951



ý☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



¨☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



	2017			2016
Allowance for doubtful accounts beginning of period	$	32,506		$	21,903
Provision for bad debts	35,949			24,512
Write-offs	(20,676		)	(16,343		)
Allowance for doubtful accounts end of period	$	47,779		$	30,072



	September 30,
	2017		2016
Risk-free interest rate	1.65	%	1.09	%
Dividend yield	—		—
Expected volatility	28.02	%	27.37	%
Expected life (in years)	3.4		3.4



	Shares		Weighted Average Grant Date Fair Value
Outstanding at December 31, 2016	379		$	140.39
Granted	204		149.95
Vested	(204	)	136.85
Cancelled or forfeited	(48	)	153.24
Outstanding at September 30, 2017	331		$	149.24



Prepaid expenses and other	79,725
Property and equipment	7,106
Other long term assets	10,025
Goodwill	436,138
Customer relationships and other identifiable intangible assets	358,168
Liabilities assumed	(187,664		)
Deferred tax liabilities	(119,419		)
Aggregate purchase price	$	584,079



Trade and other receivables	$	8,175
Prepaid expenses and other	783
Property and equipment	206
Goodwill	9,209
Other intangible assets	46,034
Liabilities assumed	(11,078		)
Deferred tax liabilities	(9,211		)
Aggregate purchase prices	$	44,118



Trade and other receivables	$	243,157
Prepaid expenses and other	6,998
Deferred tax assets	20,644
Property and equipment	44,226
Other long term assets	14,280
Goodwill	663,040
Customer relationships and other identifiable intangible assets	548,682
Liabilities assumed	(315,082		)
Aggregate purchase price	$	1,225,945



Trade and other receivables	$	27,810
Prepaid expenses and other	5,097
Property and equipment	992
Goodwill	28,540
Other intangible assets	61,823
Deferred tax asset	146
Liabilities assumed	(42,550		)
Deferred tax liabilities	(5,123		)
Aggregate purchase prices	$	76,735



	December 31, 2016		Acquisitions		Dispositions			Acquisition Accounting Adjustments		Foreign Currency		September 30, 2017
Segment
North America	$	2,640,409	$	436,138	$	(92,046	)	$	—	$	707	$	2,985,208
International	1,554,741		9,209		—			3,751		91,650		1,659,351
	$	4,195,150	$	445,347	$	(92,046	)	$	3,751	$	92,357	$	4,644,559



	September 30, 2017		December 31, 2016
Term notes payable—domestic(a), net of discounts	$	3,027,472	$	2,639,279
Revolving line of credit A Facility—domestic(a)	595,000		465,000
Revolving line of credit A Facility—foreign(a)	38,047		123,412
Revolving line of credit A Facility—swing line(a)	40,193		26,608
Other debt(c)	41,771		12,934
Total notes payable and other obligations	3,742,483		3,267,233
Securitization Facility(b)	794,000		591,000
Total notes payable, credit agreements and Securitization Facility	$	4,536,483	$	3,858,233
Current portion	$	1,602,507	$	1,336,506
Long-term portion	2,933,976		2,521,727
Total notes payable, credit agreements and Securitization Facility	$	4,536,483	$	3,858,233



	2017					2016
Computed tax expense at the U.S. federal tax rate	$	114,626		35.0	%	$	59,571		35.0	%
Changes resulting from:
Foreign income tax differential	(9,247		)	(2.8	)%	(4,265		)	(2.5	)%
Excess tax benefits related to stock-based compensation	(4,360		)	(1.3	)%	(8,247		)	(4.9	)%
State taxes net of federal benefits	5,926			1.8	%	1,678			1.0	%
Foreign-sourced nontaxable income	1,558			0.5	%	(6,691		)	(3.9	)%
Valuation allowance on investment loss	16,718			5.1	%	960			0.6	%
Other	(542		)	(0.2	)%	(2,420		)	(1.4	)%
Provision for income taxes	$	124,679		38.1	%	$	40,586		23.9	%



				Merchant Payment Methods
Retail Price	$	3.00		i) Cost Plus Mark-up:			ii) Percentage Discount:				iii) Fixed Fee:
Wholesale Cost	(2.86		)	Wholesale Cost	$	2.86	Retail Price	$	3.00		Retail Price	$	3.00
				Mark-up	0.05		Discount (3%)	(0.09		)	Fixed Fee	(0.09		)
FleetCor Revenue	$	0.14
Merchant Commission	$	(0.05	)	Price Paid to Merchant	$	2.91	Price Paid to Merchant	$	2.91		Price Paid to Merchant	$	2.91
Price Paid to Merchant	$	2.91



	Three Months Ended September 30,								Nine Months Ended September 30,
Revenue by Geography*	2017				2016				2017				2016
(Unaudited)	Revenues, net		% of total revenues, net		Revenues, net		% of total revenues, net		Revenues, net		% of total revenues, net		Revenues, net		% of total revenues, net
United States	$	358	62	%	$	346	71	%	$	1,031	63	%	$	951	72	%
United Kingdom	61		11	%	56		12	%	174		11	%	175		13	%
Brazil	101		17	%	43		9	%	287		17	%	78		6	%
Other	58		10	%	40		8	%	148		9	%	113		9	%
Consolidated revenues, net	$	578	100	%	$	484	100	%	$	1,640	100	%	$	1,317	100	%



	Three Months Ended September 30,								Nine Months Ended September 30,⁸
Revenue by Product Category*	2017				2016				2017				2016
(Unaudited)	Revenues, net		% of total revenues, net		Revenues, net		% of total revenues, net		Revenues, net		% of total revenues, net		Revenues, net		% of total revenues, net
Fuel cards	$	276	48	%	$	259	53	%	$	815	50	%	$	741	56	%
Corporate Payments	72		12	%	46		10	%	169		10	%	132		10	%
Tolls	83		14	%	26		5	%	236		14	%	30		2	%
Lodging	33		6	%	28		6	%	86		5	%	74		6	%
Gift	55		9	%	58		12	%	144		9	%	138		10	%
Other	59		10	%	67		14	%	189		12	%	201		15	%
Consolidated revenues, net	$	578	100	%	$	484	100	%	$	1,640	100	%	$	1,317	100	%



	Three Months Ended September 30,								Nine Months Ended September 30,⁸
Major Sources of Revenue*	2017				2016				2017				2016
(Unaudited)	Revenues, net		% of total revenues, net		Revenues, net		% of total revenues, net		Revenues, net		% of total revenues, net		Revenues, net		% of total revenues, net
Customer
Processing and program revenue¹	$	288	50	%	$	218	45	%	$	781	48	%	$	563	43	%
Late fees and finance charges²	34		6	%	31		6	%	105		6	%	86		7	%
Miscellaneous fees³	32		5	%	34		7	%	97		6	%	93		7	%
	354		61	%	283		58	%	983		60	%	742		56	%
Merchant
Discount revenue (fuel)⁴	77		13	%	68		14	%	223		14	%	194		15	%
Discount revenue (nonfuel)⁵	45		8	%	40		8	%	130		8	%	116		9	%
Tied to fuel-price spreads⁶	53		9	%	53		11	%	165		10	%	145		11	%
Program revenue⁷	49		8	%	41		8	%	139		8	%	119		9	%
	224		39	%	202		42	%	657		40	%	574		44	%
Consolidated revenues, net	$	578	100	%	$	484	100	%	$	1,640	100	%	$	1,317	100	%



	As Reported									Pro Forma and Macro Adjusted²
	Three Months Ended September 30,									Three Months Ended September 30,
(Unaudited)	2017		2016		Change			% Change		2017³		2016⁴		Change			% Change
FUEL CARDS
‑Transactions⁵	119.6		112.5		7.1			6	%	119.6		113.6		6.0			5	%
‑Revenues, net per transaction	$	2.31	$	2.30	$	0.01		—	%	$	2.29	$	2.28	$	0.01		—	%
‑ Revenues, net	$	276.2	$	258.8	$	17.4		7	%	$	274.0	$	259.5	$	14.5		6	%
CORPORATE PAYMENTS
‑Transactions	10.9		10.0		0.9			9	%	10.9		10.2		0.7			7	%
‑Revenues, net per transaction	$	6.63	$	4.61	$	2.02		44	%	$	6.58	$	5.99	$	0.58		10	%
‑ Revenues, net	$	72.2	$	46.1	$	26.1		57	%	$	71.7	$	61.3	$	10.4		17	%
TOLLS
‑Transactions	231.0		81.1		149.8			185	%	231.0		225.0		5.9			3	%
‑Revenues, net per transaction	$	0.36	$	0.32	$	0.04		13	%	$	0.35	$	0.30	$	0.05		16	%
‑ Revenues, net	$	82.9	$	25.8	$	57.1		221	%	$	80.8	$	67.8	$	13.0		19	%
LODGING
‑Transactions	4.1		3.5		0.6			17	%	4.1		3.5		0.6			17	%
‑Revenues, net per transaction	$	8.14	$	8.04	$	0.10		1	%	$	8.14	$	8.04	$	0.10		1	%
‑ Revenues, net	$	33.2	$	28.1	$	5.2		18	%	$	33.2	$	28.1	$	5.2		18	%
GIFT
‑Transactions	294.1		269.5		24.6			9	%	294.1		269.5		24.6			9	%
‑Revenues, net per transaction	$	0.19	$	0.22	$	(0.03	)	(14	)%	$	0.19	$	0.22	$	(0.03	)	(14	)%
‑ Revenues, net	$	54.8	$	58.3	$	(3.5	)	(6	)%	$	54.8	$	58.3	$	(3.5	)	(6	)%
OTHER¹
‑Transactions⁵	19.4		20.8		(1.4		)	(7	)%	19.4		20.4		(1.0		)	(5	)%
‑Revenues, net per transaction	$	3.01	$	3.24	$	(0.22	)	(7	)%	$	2.99	$	2.80	$	0.20		7	%
‑ Revenues, net	$	58.5	$	67.4	$	(8.8	)	(13	)%	$	58.1	$	57.1	$	1.0		2	%
FLEETCOR CONSOLIDATED REVENUES
‑Transactions⁵	679.1		497.5		181.6			37	%	679.1		642.2		36.8			6	%
‑Revenues, net per transaction	$	0.85	$	0.97	$	(0.12	)	(13	)%	$	0.84	$	0.83	$	0.01		2	%
‑ Revenues, net	$	577.9	$	484.4	$	93.5		19	%	$	572.6	$	532.1	$	40.6		8	%



(Unaudited)	Three Months Ended September 30, 2017			% of total revenue		Three Months Ended September 30, 2016			% of total revenue		Increase (decrease)			% Change
Revenues, net:
North America	$	364,443		63.1	%	$	345,868		71.4	%	$	18,575		5.4	%
International	213,434			36.9	%	138,558			28.6	%	74,876			54.0	%
Total revenues, net	577,877			100.0	%	484,426			100.0	%	93,451			19.3	%
Consolidated operating expenses:
Merchant commissions	27,687			4.8	%	28,214			5.8	%	(527		)	(1.9	)%
Processing	111,283			19.3	%	96,233			19.9	%	15,050			15.6	%
Selling	45,060			7.8	%	34,180			7.1	%	10,880			31.8	%
General and administrative	92,043			15.9	%	77,904			16.1	%	14,139			18.1	%
Depreciation and amortization	69,156			12.0	%	57,084			11.8	%	12,072			21.1	%
Other operating, net	11			—	%	(244		)	(0.1	)%	255			104.5	%
Operating income	232,637			40.3	%	191,055			39.4	%	41,582			21.8	%
Investment loss	47,766			8.3	%	2,744			0.6	%	45,022			1,640.7	%
Other (income) expense, net	(175,271		)	(30.3	)%	293			0.1	%	175,564			NM
Interest expense, net	29,344			5.1	%	17,814			3.7	%	11,530			64.7	%
Loss on extinguishment of debt	3,296			0.6	%	—			—	%	3,296			—	%
Provision for income taxes	124,679			21.6	%	40,586			8.4	%	84,093			207.2	%
Net income	$	202,823		35.1	%	$	129,618		26.8	%	$	73,205		56.5	%
Operating income for segments:
North America	$	138,748				$	135,760				$	2,988		2.2	%
International	93,889					55,295					38,594			69.8	%
Operating income	$	232,637				$	191,055				$	41,582		21.8	%
Operating margin for segments:
North America	38.1		%			39.3		%			(1.2		)%
International	44.0		%			39.9		%			4.1		%
Consolidated	40.3		%			39.4		%			0.8		%



(Unaudited)	Nine Months Ended September 30, 2017			% of total revenue		Nine Months Ended September 30, 2016			% of total revenue		Increase (decrease)			% Change
Revenues, net:
North America	$	1,037,386		63.3	%	$	950,542		72.2	%	$	86,844		9.1	%
International	602,161			36.7	%	366,051			27.8	%	236,110			64.5	%
Total revenues, net	1,639,547			100.0	%	1,316,593			100.0	%	322,954			24.5	%
Consolidated operating expenses:
Merchant commissions	82,690			5.0	%	78,755			6.0	%	3,935			5.0	%
Processing	316,429			19.3	%	256,738			19.5	%	59,691			23.2	%
Selling	122,854			7.5	%	92,680			7.0	%	30,174			32.6	%
General and administrative	275,046			16.8	%	209,084			15.9	%	65,962			31.5	%
Depreciation and amortization	198,731			12.1	%	141,848			10.8	%	56,883			40.1	%
Other operating, net	49			—	%	(690		)	(0.1	)%	739			107.1	%
Operating income	643,748			39.3	%	538,178			40.9	%	105,570			19.6	%
Investment loss (income)	52,497			3.2	%	(2,247		)	(0.2	)%	54,744			(2,436.3	)%
Other (income) expense, net	(173,626		)	(10.6	)%	1,056			0.1	%	174,682			NM
Interest expense, net	76,322			4.7	%	49,905			3.8	%	26,417			52.9	%
Loss on extinguishment of debt	3,296			0.2	%	—			—	%	3,296			—	%
Provision for income taxes	227,756			13.9	%	132,503			10.1	%	95,253			71.9	%
Net income	$	457,503		27.9	%	$	356,961		27.1	%	$	100,542		28.2	%
Operating income for segments:
North America	$	394,646				$	367,221				$	27,425		7.5	%
International	249,102					170,957					78,145			45.7	%
Operating income	$	643,748				$	538,178				$	105,570		19.6	%
Operating margin for segments:
North America	38.0		%			38.6		%			(0.6		)%
International	41.4		%			46.7		%			(5.3		)%
Consolidated	39.3		%			40.9		%			(1.6		)%



	Revenue						Transactions
	Three Months Ended September 30,						Three Months Ended September 30,
(Unaudited)	2017			2016			2017		2016⁴
FUEL CARDS
Pro forma and macro adjusted^2,3	$	274.0		$	259.5		$	119.6	$	113.6
Impact of acquisitions/dispositions	—			(0.7		)	—		(1.0		)
Impact of fuel prices/spread	(0.6		)	—			—		—
Impact of foreign exchange rates	2.9			—			—		—
As reported	$	276.3		$	258.8		$	119.6	$	112.5
CORPORATE PAYMENTS
Pro forma and macro adjusted^2,3	$	71.7		$	61.3		$	10.9	$	10.2
Impact of acquisitions/dispositions	—			(15.2		)	—		(0.2		)
Impact of fuel prices/spread	0.1			—			—		—
Impact of foreign exchange rates	0.4			—			—		—
As reported	$	72.2		$	46.1		$	10.9	$	10.0
TOLLS
Pro forma and macro adjusted^2,3	$	80.8		$	67.8		$	231.0	$	225.0
Impact of acquisitions/dispositions	—			(42.0		)	—		(143.9		)
Impact of fuel prices/spread	—			—			—		—
Impact of foreign exchange rates	2.1			—			—		—
As reported	$	82.9		$	25.8		$	231.0	$	81.1
LODGING
Pro forma and macro adjusted^2,3	$	33.2		$	28.1		$	4.1	$	3.5
Impact of acquisitions/dispositions	—			—			—		—
Impact of fuel prices/spread	—			—			—		—
Impact of foreign exchange rates	—			—			—		—
As reported	$	33.2		$	28.1		$	4.1	$	3.5
GIFT
Pro forma and macro adjusted^2,3	$	54.8		$	58.3		$	294.1	$	269.5
Impact of acquisitions/dispositions	—			—			—		—
Impact of fuel prices/spread	—			—			—		—
Impact of foreign exchange rates	—			—			—		—
As reported	$	54.8		$	58.3		$	294.1	$	269.5
OTHER¹
Pro forma and macro adjusted^2,3	$	58.1		$	57.1		$	19.4	$	20.4
Impact of acquisitions/dispositions	—			10.3			—		0.4
Impact of fuel prices/spread	—			—			—		—
Impact of foreign exchange rates	0.4			—			—		—
As reported	$	58.5		$	67.4		$	19.4	$	20.8

FLEETCOR CONSOLIDATED REVENUES
Pro forma and macro adjusted^2,3	$	572.6		$	532.1		$	679.1	$	642.2
Impact of acquisitions/dispositions	—			(47.6		)	—		(144.7		)
Impact of fuel prices/spread	(0.5		)	—			—		—
Impact of foreign exchange rates	5.8			—			—		—
As reported	$	577.9		$	484.4		$	679.1	$	497.5

* Columns may not calculate due to impact of rounding.
¹Other includes telematics, maintenance, food and transportation related businesses.
²2016 is pro forma to include acquisitions and exclude dispositions, consistent with 2017 ownership.
³2017 is adjusted to remove the impact of changes in the macroeconomic environment to be consistent with the same period of prior year, using constant fuel prices, fuel price spreads and foreign exchange rates.
⁴2016 transactions reflect immaterial corrections from previously disclosed amounts for the prior period.



Period	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of the Publicly Announced Plan	Maximum Value that May Yet be Purchased Under the Publicly Announced Plan (in thousands)
August 1, 2017 through August 31, 2017	1,491,647	$	142.46	3,161,958	$	647,430
September 1, 2017 through September 30, 2017	952,146	$	144.38	4,114,104	$	509,957