WEX Inc. (WEX) Earnings Call Transcript & Summary

We're going to get started here. So to close out the day, I'm excited to introduce our next guests from WEX: CFO, Roberto Simon; Steve Elder, from Investor Relations. Both of them have been regular attendees of our conference, so we really appreciate them attending this year. And obviously, they put out an announcement this morning about some of the impacts related to the coronavirus. So maybe we can start with that and just talk about some of the inputs into your assumptions around the impact. Roberto?

Good. Well, thank you for hosting us. It's interesting because we have been monitoring coronavirus for already 5 or 6 weeks. We gave guidance in the second week of February, and we had no access to data up to almost a day before, 2 days before and we didn't saw any impact. I think 2 catalysts have been what have changed now the situation. The first one was the South Korea and Iran cases that increase, so we saw a significant reduction in volume in Asia, in week 6 to week 7. And then 10 days ago, with the Italian cases, we saw a deceleration in the European market. So we saw a couple of big swings. And as we look into the March numbers, we thought it was appropriate to communicate what other companies have been now communicating. If we talk with Mastercard, Visa, Priceline, Expedia, ourselves, I mean, we all are seeing the same trends. And I think it's consistent now.

And as you're looking at the trends sort of day by day. Maybe just -- obviously, it's very fluid. Are the trends getting worse as we're sort of progressing? Or have you seen any stabilization?

So when the Asia market -- when we saw the big step down in the Asian market from 3 weeks ago, it has been pretty stable. There has not been significant increases or decreases. And in the case of Europe, it was last week, we have not seen -- I have not seen volumes over the last 2 or 3 days. But we expect the same trend, more like a step down and then stay the course. We are hearing now, we hear all the European airlines the last few days canceling trips to Italy. And the United Airlines also announced just today some. So it's going to be evolving. It's going to evolve.

I see. And then it seems like you haven't seen as much impact in the United States, yet?

Yes. So one of our largest -- of our business in the travel space today, 80% is an issue in the U.S., approximately 15% is issue in Europe and less than 5% is in Asia. Of the 80% in the U.S., approximately 50% is U.S. to U.S. or domestic, and the other 50% issue U.S.-international travel. That one is the one that we have been seeing more deterioration in the past 2, 3 weeks. But the U.S. one, I mean, you can take 1%, 2%, 3%, but nothing more than that.

Okay. And then you also sort of talked about fleet seeing some impact. Has that been sort of a steady decline? Or do you feel like that could actually start getting worse because you do have the supply chain issues?

So 2 things. Second half of last year on the over-the-road market, we saw some slowdown or softness in the -- and we modeled that to continue for this year. Related to the supply chain, it's also evolving daily. We have seen some companies that they are back on stocks, orders that they have been continuing with that trend. We don't want to think on what is going to be today, what is going to be tomorrow. On the guidance, we contemplated the impact on our overall business is small, between fuel prices and OTR of the revenue reduction, we are talking 1/4 to 1/3 of impact, both OTR and PPG. And PPG is mainly -- fuel prices is mainly marked. So the big bulk of what we are now seeing is on the travel space.

Okay. And I guess, Melissa talked about sort of historical precedent on this type of event. I mean, do you feel like the same playbook should be -- is going to happen here? Or do you think this one is a little bit different?

So I think we all hope it's the same playbook. Let's just start there. I mean, we have done a lot of research. We are everyday talking with the customers, with vendors, with our employees. We hope that this is some sort of the same case, where we have this 2-, 3-, 4-month window where travel dips and eventually is going to come back very quickly. But obviously, we need to see how it evolves in the next, I would say, few days.

So one final question on eNett given their Asian exposure. Sort of how are you thinking about that business? Obviously, a lot of this stuff has evolved quite dramatically since you announced the acquisition. Do you feel any different about that acquisition? Or you guys feel still pretty good there?

So we bought the asset for a reason. We bought the asset because it's growing very nicely, it's complementary to us. It's 60% European business, 40% Asia. So it gives us complementary present from a spend point of view. They run over 50 currencies. So it gives us access to markets that we couldn't access before. And we bought it for the growth. They were growing very nicely early in the -- as we were, as like everyone else, they are softening like us. So the trends, as I said, from them or from Mastercard, Visa, ourselves, Priceline, Expedia are the same. And I don't think anything has changed from what we announced back in January. We are looking forward to this transition go through the EU and being on the exit side and back to the growth rates.

Absolutely.

Yes.

So I guess, since you've joined the company, WEX has done a number of deals focused on fleet, health care. You did a big deal right now, obviously, with eNett. Could you just talk about the evolution of the business model over your tenure and how it all comes together for investors?

And I will place it even before myself, even when Steve was here. I think we have -- the fact that we are in 3 very different businesses from a maturity point of view, I think is a good complement for us. Because if you talk on the fleet, it's a mature business, high margin, more stable, great free cash flow and growing nicely. It allows us to deploy this free cash flow into other businesses or other growing segments. You talk about travel, when I joined, it was almost travel, now it's travel and corporate. Payments, it's allowing us to grow to scale, to diversify and go to other markets where we were not able to go before. And then if you talk about the health segment, what a great story. I was talking this morning with Steve. The company bought Evolution1 back in '14. The revenue was $85 million. We're going to have this year, hopefully, we keep going the way we are, close to $400 million. So -- and all of these 3 segments are in different cycles. And that's great because it gives us -- sometimes, it's more complex to manage. Where do you invest more? How you deploy your internal capital? But it's a great story and they complement very well.

And so when we think about all these deals that you've done, where do you feel like there's a lot more wood to chop and extract more benefit from?

I think EFS was the best deal for the company. It was the largest at the time. We paid $1.4 billion. If I look today, the multiple of that transaction is probably 6x. I don't think it's more than that, EBITDA. I mean, we really have done really well. The company was good. Scott Phillips, we're running the business at the time, he's with us on the EFS. He knows the business inside out. There was great people, great technology. So obviously, we feel very good about the value we extracted and where we are today. I mean, the market share that we have today compared to what we had 4 years ago, it's pretty significant improvement. And then if you look in the last 3, 4 transactions, they are all important, some larger than others. I think if you ask me personally, I think the Discovery Benefits acquisition, it's a great complement to our WEX Health business. And we see -- we saw less in '19 because it was acquisition-related, but as we overlap it at the end of Q1 and into Q2, it's going to be all organic growth. We are all going to see that the legacy WEX Health plus Discovery Benefit is growing in the mid- to high-teens when the market now is growing in the 10% to 12%. So we are looking forward to that so that investors can see the importance of the business. And that comes also with improvement in margins that we have steadily been improving on the health segment since we bought the business in 2014.

And what can you guys do with Discovery Benefits that Discovery Benefits couldn't do for itself?

I would say a couple of things. One, obviously, when you are a TPA like they were, sometimes, there's always some noise, are that they're going to be sold or not. So the big potential employers, they may have their own point of view of what happens if they are sold to someone else, and they become a small piece, and we become nobody. So employers look at okay, who's going to be the next owner? That's one thing. The second thing, obviously, is that now, we own the front end and the back end. So we have the sell-side but we also own the technology and the platform. Before it was our customer, and "What can I do for you?" Now we are working together. And I think there's more flexibility and we can now tweak things for the customer much faster because there's nobody in between. There was the employer, DBI and us. Now we are all one, and we are seeing a lot of improvement on that area.

And I guess, you have talked about that you're going to avoid channel conflicts with your customers. Could you just talk about sort of what the reception has been from your own clients? Because they've sort of seen you come into a business that sort of competing with them?

So what I would say, and we said that at the beginning. We do this in fleet inside out every day. And if you look in the U.S., of the top 10 oil companies, we have 9. And we operate with firewalls, and it worked really well. And when we bought Discovery Benefits, we have this conversation with all of our partners. And so far, if you talk to them, they will really recognize that WEX is doing a great job in maintaining the firewalls and who goes to where and what is the price that you give to one or another and how you compete. So we feel very confident and comfortable that, that's part of the core expertise of WEX overall.

I'd also add on just to the marketplace. We've been able to sign companies like MetLife, like Voya, like MassMutual, all since we announced the Discovery Benefits deal. So that fear of channel conflict, that's just fading away somewhat.

Yes.

Okay. You've kind of touched on eNett, so sort of the deal and what it brought. But maybe you could expand a little bit more on sort of what made it a good fit for WEX. Because it seemed like they were your main competitor in many aspects. So maybe just talk about why it was such a good fit?

Yes. We don't call it main competitor but a competitor, like we have many others. I mean, the way we think when we do M&A and we talk on our Investor Day. So we want to invest in businesses that grow faster than our organic growth. We want to diversify from fuel prices. And if we can, we want to extend in other geographies, expand our presence. So it's in the 3 stakes. Additionally, for us, and you know that, Sanjay, people is key for us. In all of the transactions that we have done, EFS, Evolution1, et cetera, I mean, if we look back, we maintain most of the management team, that's very important. And they had great people, talented and also with great relationships in the industry. So for us, that was very important as well. And finally, they have a technology, and they offer a product that we don't offer today. So from that front, I think we can go to our customers that, in many cases, I even have access to some of their customers, and they have had access to some of our customers, and we can offer both the credit solution or the prefunded solution. So when you put all of these things together, I think it's a perfect fit for WEX.

And then when we think about future deals, obviously, you're probably going to deleverage for a little bit here. But as we think about future deals, should we expect them to be bolt-on to the various segments you have? Or could you go out of sort of the scope of where you've been?

I think there's a lot of room still in the segments where we are fleet: travel and corporate payments, which, we have it in 1 today, but it's like 2 different segments. And then on the health side, I think there's a lot of opportunities. If you're seeing on the sell side, the consolidation has started. We did that transaction last year. I think there will be more to come. And in the corporate payment space, I mean, how many companies are out there today? So there's a lot of opportunities. Travel and also fleet, I mean, we did a small transaction or medium-sized transaction last year In Europe, there will be also opportunities, I think. We cannot say that we are not going to enter another segment, but we have still room to grow in the markets where we operate.

Got it. So maybe we'll dig into the segments. Maybe you could talk about the fleet business and its positioning right now? Obviously, you mentioned it's a mature market, but there's still a lot of growth potential. So maybe you could just frame sort of the growth potential and talk about international? Because that's a big opportunity, I think, in that business.

Yes. So we guided organically long-term growth rates of 4% to 8%, and that's excluding fuel prices. We are very proud, and this morning, Steve and I were talking, just reminding us sometimes what we have done in the past years. I mean, the Fleet segment has been growing over 10% organically for the last 6, 7 years, at least. So we have been really outpacing our long-term targets and the market. We believe on the sales engine with a small fleet. With the acquisition of EFS, we entered over-the-road larger trucks fleet. And then we have been investing in new products that we have been deploying into the market. When you put all of these things together, we believe and we are confident that there's still a lot of opportunities to tackle.

And the over-the-road, the success in over-the-road, how -- I mean, have you kind of spoken to the market share you have in that business and sort of where it can go?

I would say that today, we are more or less 50-50 in the U.S., obviously with a huge improvement in the past 3, 4 years since we own EFS. But we believe that there is still -- we have more opportunities to tackle. We signed in '19 several accounts that we are now implementing. And again, it's all about the people, the technology that we have and chasing the market.

Right. So I guess, in the U.S., you've seen a lot of the fuel companies’ transition over to an outsourced model. You guys own the space to 90%. How do we see that sort of translating internationally, the 90% share you have here, to the playbook in Europe and Asia and other countries?

I will talk separate on Asia and Europe. In Asia, we have been doing a lot of different projects with our big -- Chevron, Shell, ExxonMobil, Caltex in the small Southeast Asia countries. That is small, but it's something that we have been working, I mean, even I was here, probably 6, 7 years ago we started that work. There are small deals, but we are doing some of them. I presume you mean more in the European market where -- I remember when I joined, there was a lot of discussion, there's going to be 2 portfolios in the market. And 4 years later, we are still here. So what I would say to you are a couple of things. Two of the -- so Shell and ExxonMobil are outsourced. ExxonMobil with us, and Shell with FLEETCOR. We took over the ExxonMobil portfolio with -- that was declining, and we stabilized that portfolio. Now we bought the Go Fuel Card from Euro Garages. I think this is going to help us to increase our network presence. And we just need to be there for what the oil companies want to do. For me, the biggest fear for them is that they are in 10, 15, 20 countries, and each of the countries has either a different system or they have different priorities. And we saw it with Exxon, at the end of the day, we 8 countries that we deal with, yes, there's an overall relationship. But each country has their own responsibilities. And when you have, on top of that, different systems that you will need to migrate it somewhere, it's a big project. So I think it will eventually happen, but it's not going to be fast.

And so your sales pitch there is you can go with an integrated solution?

We can integrate like what we did with ExxonMobil. We have now most of the countries in our platform. We have 2 platforms, but we are operating both of them depending on the country and the needs of the customers. And we offer the sales and marketing capabilities. That is our core expertise in the States. And that's where we are now. That's why the portfolios in the U.S. have come with us because of the history of buying a portfolio, taking it over and converting from either declining to growth or from growth to higher growth. And we have done that in Europe, and we have proved that in Europe.

And just to go back to my previous question, just in terms of the 90% share. Does that mean that you can follow those relationships into these other markets? And -- or at least have a better seat at the table? Or how should we think about that?

Of course, they are important. And we have a group of people that the only thing they do is they manage the relationships at the high level. And either in the U.S. or in Europe or in Asia, they are on those conversations. I think when we won the Shell portfolio, the fact that EFS cut Shell and the fact that we also have the prepaid business in Europe and that we were doing well with them, helped in that transition. I mean, I will never discount that, but you also have to offer a good solution in the marketplace, and the oil companies have to be confident that you can deliver on -- what they need.

So Shell and Chevron are obviously transitioning over to you guys, and you've walked through the financial impacts. Where is the upside to some of the assumptions you've made around the synergies there?

So the upside -- more than the upside, the way we think with these oil companies, and Steve, you're waiting here because you know more than me from past, big portfolio wins. They were either declining or they were not happy with the support or with the customer service. That's what we want. Get our business, stabilize it and then grow with the oil company, and offer them best-in-class solution, grow the volumes. Because for them, it's not about just their fuel, it's about going to the merchant and to the gas stations. So what we see here is -- last year was bringing the portfolios, stabilizing them, start seeing the growth, and then obviously, deploy some of the other products that we also offer.

And Mike, what is -- maybe you could speak to the history of sort of how you guys have transformed something that might have been losing share to actually taking share?

It's just supplying the sales and marketing techniques. So when we're going through the RFP process, we'll literally take a location that they have and say, these are the businesses around this location, this is how we'll market to them, this is the type of response rates we can expect and kind of extrapolate that through their portfolio. And then compare it, say, this is -- we've actually done this over here for A, B and C peer company for you. And here's the results you've had. So this is the type of result you can expect. And it plays pretty well, right? It works.

It definitely works. I guess one last question on fleet. Obviously, one of the investor areas of concern is just the volatility related to oil prices. I mean, have you guys -- I mean, obviously, you've worked hard in diversifying the business model, but within fleet, is there a way to sort of mitigate some of that volatility?

I mean, we have done things. The fact that you invest in Europe where you are spread-based instead of interchange-based helps the volatility, because if fuel prices go up here, you may have negative spreads in Europe or vice versa. So -- and we are seeing this, in Q1 this year, the other way around. As we have diversify our product offering, trying to move from mobile interchange to other type -- I don't want to call them fees, because they are not fees. If I give you fleet access to 3 or 4 new products, and I charge you a SaaS fee, for example, that's also diversifying from fuel prices. And in the case, for example of EFS, EFS has a bunch of products around the driver and around the trucking industry of fleets that offer things beyond just go to the gas station, fill the tank and go. And that's where we have been working very diligently in the past 3, 4 years since -- before the EFS transaction, but even more now that we combine it with EFS, because EFS was offering a lot of different products around that.

So one question on the revision in the guidance. Was it all sort of just volume based? Or was there another component inside of that, like fuel prices?

So what I said this morning in some of the meetings is, of the guidance reduction, you can say 2/3 to 3/4 is related to the travel business. And then the other piece is the softness in over-the-road plus the fuel prices for the month of March. Because when we guided, we knew what January was. February, we had 10 days in, and really, we are, we think, $0.5 million, I would say. But obviously, in the month of March, that's where they got this. So both over-the-road plus the fuel price impact would be the remaining amount.

Understood. The figure I believe is small...

[indiscernible] we were going through the guidance.

Yes. Obviously, it's small overall, but we wanted to reflect that.

Understood. Okay. Maybe we can sort of disaggregate travel and corporate and speak to each one separately, because we obviously know more about travel, I feel, than corporate. So maybe we can dig a little bit deeper in corporate, and you can just talk about that business and sort of where it's headed.

Yes. So if you look at the segment of the travel and corporate payment, revenue-wise, approximately today, 60% is travel and 40% is corporate payments. Volume-wise is 80% travel, 20% corporate payments. If you break down the corporate payments, so that 40% in revenue, we have 3 legs: one is the FI business, that came when we bought AOC back in 2017. It was '17?

Yes.

More or less, it's 1/3 of the business. Then when we acquired, if you remember, EFS, there was an accounts payable solution for corporate payments, where we either go direct to employers or we use partners that they have been -- we have been growing very nicely with them in the past 2 years. And the third leg is the acquisition we did last year of Noventis. So those 3 businesses are distinct. But all of them are in a good track record and on the growth side. So really, if we think internally about the travel and corporate payment segment, we think about the 4 legs, those 4 pieces: travel; and the FIs; the payables, accounts payable solution; and then obviously, the bill pay or Noventis.

And so when we sort of disaggregate sort of what the expected growth rate is of that segment, how do we disaggregate the growth rates between these 4 legs?

Yes. So at Investor Day, a year plus ago, we talked about the travel business. So you need to think around 9% is, I believe, what we guided is the growth of the travel segment. Obviously, different growth rates in Asia, Europe and the U.S., but blended, call it around 9% and then if you think about the other -- the 2 corporate payments, you can see business is growing, where the market is growing at 10%, and others are 30%. We guided on the 15% to 20% for that part of the business overall.

And I guess, like there's so much fragmentation within corporate. How does it all come together at some point?

I think it's going to be like any industry. In any industry, in health, you can see it today. 4, 5 years ago, there were a lot of small players, they are all being bought and there's consolidation. In the corporate payments is -- it will happen too. At some point, everybody is trying to solve for a problem, and at some point, when I call it, when the dust settle and the prices for doing any money transaction become more realistic, there will be also some M&A. So it will eventually consolidate.

So I'm going to open up to the audience after this question, so please be prepared for some questions, if you can. When we think about the travel -- digging a little bit into the travel business. Predominant use case is hotels. Can that be utilized in other verticals of travel over time?

The answer is yes. We as WEX, we do some air.

A little bit.

Yes. eNett does more than us. I mean, they are not 50-50 hotel and air, but they do a bigger portion of their business is air. And I think it's a matter of getting all these companies used to the same like with hotels and the OTAs to deal with the hotel where WEX funded that product back in the days to expand to other -- not other industries, but to other options, car rentals and many other opportunities.

And what's the biggest impediment? Is it price? Is it -- what is it?

If I say to you, looking from a WEX site, is the priority of WEX is the priority of our customers too. Like you have competing priorities, and when you are growing 10%, 15%, 20%, sometimes, you keep on that track and you have to prioritize what you want to deliver and the investments you want to do. But I think it will come eventually.

And then the virtual part -- I don't know, Steve, if you have any other...

No. I think the real reason that the hotel program works very well is because the merchant base is so fragmented and the payment happens later and because of all the ancillary fees that can accrue at a hotel, the price can change kind of over time, if you will, if you add breakfast or something like that. With an airline ticket, you have to pay immediately and the price doesn't change, right? So the value proposition is a little bit different there. Rental cars are a bit more like hotels, right, except that they're not as fragmented. It's still a fairly concentrated number of merchants. So you can -- it was easier for them to build those more direct connections. And now we're in a spot where you have to display something that's pretty well established, and so to kind of change those things operationally, it's not easy to do that.

And what about other complete verticals, like sectors, other sectors outside of travel, the virtual card product. I know you guys tried health care. It didn't seem like it took off a whole lot. But like are there any other sector that you think might work?

You talk about that because we used to have...

Yes. I mean, we've looked at some health care, we've looked at some insurance, sort of warranty kind of payments. And we've had some success sporadically, I'll say. Those two industries are a little harder because they're a little bit more regulated. And there's always this question from the insurance companies, if we share some interchange back with them, did they pay the amount they were kind of responsible for or not, and they get a little bit nervous with that kind of scenario. So we've looked certainly over the years. But as Roberto said, when you got a good thing here and you're having success, you keep feeding it.

That's fair, focus on the core. Questions from the audience? All right. I'll keep going. So definitely, health care, I feel like is a really nice business that's growing quite nicely and hasn't really, I guess, attracted the attention of investors when you look at valuations, because some of your competitors trade at really high valuations. I mean, I guess, you mentioned Discovery Benefits is going to be a big contributor, and that might draw more attention. But I mean, what else can really get people's attentions, in your mind?

Well, number one, I think, is how big the segment is overall in WEX. Because on the other segments, we have been very successful, too. Obviously, the growth gets a bit diminished. But as I said, we're going to be close to $400 million this year in the segment, growing very nicely organically. We are capturing a lot of market share. I think we will see more M&A as we look into the future, and it's also on our side to talk more on the earnings call and when we do Investor Day, and when we did Investor Day, we had a good -- great presentation out of the group. So making to everybody more shiny and better and do a bit more marketing with that. But really, it's a great -- I mean, even when we did the press release this morning, I mean, it's -- yes, it's performing. It's growing on the almost 20% and it outperformed -- it's outperforming what we are expecting for the quarter. So I think that's important that we mention it, too.

And what has been the key to success there?

I think it's many things. The people, I mean, when the asset was bought, during the first 5 years, I think everyone from the management team was there, and only one person -- after 6, 7 years, only one person of the management team have left the organization. So people is very important, because you are dealing with the big employers and with big partners. And it's important, the relationship and how you work together with them. The second thing is the investments. You need -- we want to be the best-in-class in the platform that we offer. I think it went on the fact we are really on the high end, and that's also a big part of the success. So sometimes, you say, well, can I shave a point in margin? Well, yes, always, you can. How much are you going to reduce your growth profile? That's the key thing. So we have been really investing every year what they have proposed or what they have needed to continue growing new customer or expanding within the customers that they have. And that makes -- it's really working very well.

And you mentioned M&A -- more M&A in the future. Like what shape would that take in health care? Would it be consolidation? Or would it be adding other competencies there?

I think there's many options. I mean, we bought Discovery Benefits, you could do some other TPAs, you could get in the Benefit. I mean, there's a lot of opportunities and a lot of the companies available. And as the market continues to consolidate, I think WEX is going to be a key player in this segment.

And then you guys have broken apart sort of HSA, FSA growth opportunities. Clearly, the predominant growth opportunities is in HSA. Can you just kind of walk us through again sort of what the growth algorithm is there? And then how that could work, maybe even outside of the United States, potentially? Can it? Is that the better question?

I will answer it latter. Steve can answer the former one. I think it's difficult. I mean, we have cut internally. Our Australian team wanted to look into the product and into the platform to launch it in Australia. I think this market is unique in terms of health care, and I believe in many countries. I don't think today, besides maybe Australia or in the U.K., that there could be -- it could be used for some functionalities. I think it's difficult area. You really -- again, we compete in priorities. If we say, what can I build for WEX Australia, for example, to deploy in Australia, and you put it in the priority list of what the fishes they need to fish get in the State, it doesn't get the cut. Related to the market, Steve.

I mean, the HSA market has clearly been propelling the growth there, right? And really, what's happening is employers are trying to control their costs around health care. And so they, I'll say, transition their employees under these high deductible health plans, which kind of gives rise to the HSA. And that's the trend that we've been riding for 5, 6 years now, and looks like it's still continuing, right? And still a long ways to go. I think there's also a lot of education that needs to go on so that people that are looking at these as -- these high deductible plans as an alternative aren't scared away by the deductible, because it really does make a whole lot of sense in a lot of cases. But you have to kind of understand how the program works. And that's -- we had an HSA Day to just -- as well to try and kick start that a little bit, but there's still a lot more to go.

So we're running out of time. Actually, we have run out of time. But I have one last question. You guys have executed flawlessly, in my opinion. Obviously, coronavirus withstanding, we'll hopefully come through on the other side. But what are the biggest risks to your model going forward?

Maybe if you ask it differently. What keeps you...

What keeps you awake?

Yes. I think it's the how quickly the world changes. And on the technology side, with all these big and small players in each of the industries. I mean, would probably less in fleet, but in the other segments where we operate, there's talented people everywhere. There's great companies and what we don't see today that may be here now in a week or in 2 weeks. And that's an area where the corporate development team and our IT group, we spend a lot of time and a lot of money to make sure that we are first to market in many things. But that would be, for me, the disruption from other small players that you may not see them and so many they are here. And they are a 30, 40, 50 years in market cap. More than anything else, I mean, fuel prices, yes, they keep us awake, but we all know what it means to invest in the WEX stock from a fuel price point of view. M&A, we have been executing, as you said, very nicely. And we are looking forward for the eNett and Optal transaction and to continue delivering on the dividend value to our shareholders.

And given where fuel prices, you guys aren't thinking about hedging again?

I'm not going to look at Steve. I would say, no. Our core competency is to continue diversifying. I think he will say the same. But at the end of the day, we lost 40-plus million in 10 years despite in the last year, we got $40 million, and what we need to continue is doing what we are, which is the sensitivity to fuel prices from an earnings point of view has gone down more than 50% in the last 5 years. And that's what we need to do. And as you said in one of the questions you asked us, what can we do to continue reducing that? And that's a key for the fleet team. It's something key, not only to grow, but what can we do also to reduce the exposure and the sensitivity.

All right. We're out of time. Thank you guys. I really appreciate it.

Thank you.