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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 __________________________________________________________
FORM 10-Q
 __________________________________________________________
 _________________________________________________________________________________________________
ý☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended SeptemberJune 30, 20172021
OR
¨☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 001-35004
 __________________________________________________________
FleetCorFLEETCOR Technologies, Inc.
(Exact name of registrant as specified in its charter)
 __________________________________________________________
Delaware72-1074903
(State or other jurisdiction of

incorporation or organization)
(I.R.S. Employer

Identification No.)
5445 Triangle Parkway,3280 Peachtree Corners, GeorgiaRoadAtlanta30092Georgia30305
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code: (770) 449-0479
 __________________________________________________________Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common StockFLTNYSE
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý☒    No  ¨☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ý☒    No  ¨☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one:)
Large accelerated filerý☒Accelerated filer¨☐
Non-accelerated filer
¨  (Do not check if a smaller reporting company)
☐		Smaller reporting company¨☐
Emerging growth company
¨
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ¨☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨☐    No  ý☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
ClassOutstanding at October 31, 2017August 1, 2021
Common Stock, $0.001 par value89,560,78882,604,105

Table of Contents


FLEETCOR TECHNOLOGIES, INC. AND SUBSIDIARIES
FORM 10-Q
For the Three and Nine Month PeriodsSix Months Ended SeptemberJune 30, 20172021
INDEX
Page
PART I—FINANCIAL INFORMATION
Item 1.
Page
PART I—FINANCIAL INFORMATION
Item 1.
Consolidated Balance Sheets at SeptemberJune 30, 20172021 (unaudited) and December 31, 20162020
1
2
3
4
45
6
Item 2.
2124
Item 3.
4443
Item 4.
4443
PART II—OTHER INFORMATION
Item 1.
4544
Item 1A.
4544
Item 2.
4745
Item 3.
4745
Item 4.
4745
Item 5.
4745
Item 6.
4846
4947


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PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
FleetCorFLEETCOR Technologies, Inc. and Subsidiaries
Consolidated Balance Sheets
(In Thousands, Except Share and Par Value Amounts)
June 30, 2021December 31, 2020
(Unaudited)
Assets
Current assets:
Cash and cash equivalents$1,301,207 $934,900 
Restricted cash758,096 541,719 
Accounts and other receivables (less allowance for credit losses of $92,100 at June 30, 2021 and $86,886 at December 31, 2020)1,787,155 1,366,775 
Securitized accounts receivable—restricted for securitization investors1,000,000 700,000 
Prepaid expenses and other current assets407,685 412,924 
Total current assets5,254,143 3,956,318 
Property and equipment, net216,681 202,509 
Goodwill5,058,174 4,719,181 
Other intangibles, net2,265,574 2,115,882 
Investments11,857 7,480 
Other assets220,454 193,209 
Total assets$13,026,883 $11,194,579 
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable$1,578,266 $1,054,478 
Accrued expenses290,120 282,681 
Customer deposits1,570,190 1,175,322 
Securitization facility1,000,000 700,000 
Current portion of notes payable and lines of credit346,080 505,697 
Other current liabilities195,762 250,133 
Total current liabilities4,980,418 3,968,311 
Notes payable and other obligations, less current portion3,732,701 3,126,926 
Deferred income taxes565,856 498,154 
Other noncurrent liabilities259,061 245,777 
Total noncurrent liabilities4,557,618 3,870,857 
Commitments and contingencies (Note 12)00
Stockholders’ equity:
Common stock, $0.001 par value; 475,000,000 shares authorized; 126,944,155 shares issued and 82,595,087 shares outstanding at June 30, 2021; and 126,448,078 shares issued and 83,666,163 shares outstanding at December 31, 2020127 126 
Additional paid-in capital2,821,453 2,749,900 
Retained earnings5,797,431 5,416,945 
Accumulated other comprehensive loss(1,265,177)(1,363,158)
Less treasury stock, 44,349,068 shares at June 30, 2021 and 42,781,915 shares at December 31, 2020(3,864,987)(3,448,402)
Total stockholders’ equity3,488,847 3,355,411 
Total liabilities and stockholders’ equity$13,026,883 $11,194,579 
See accompanying notes to unaudited consolidated financial statements.

  September 30, 2017 December 31, 2016
  (Unaudited)  
Assets    
Current assets:    
Cash and cash equivalents $834,756
 $475,018
Restricted cash 183,515
 168,752
Accounts and other receivables (less allowance for doubtful accounts of $47,779 and $32,506 at September 30, 2017 and December 31, 2016) 1,456,255
 1,202,009
Securitized accounts receivable—restricted for securitization investors 794,000
 591,000
Prepaid expenses and other current assets 252,975
 90,914
Total current assets 3,521,501

2,527,693
Property and equipment, net 168,065
 142,504
Goodwill 4,644,559
 4,195,150
Other intangibles, net 2,876,440
 2,653,233
Investments 33,526
 36,200
Other assets 86,203
 71,952
Total assets $11,330,294

$9,626,732
Liabilities and stockholders’ equity    
Current liabilities:    
Accounts payable $1,435,585
 $1,151,432
Accrued expenses 285,841
 238,812
Customer deposits 731,501
 530,787
Securitization facility 794,000
 591,000
Current portion of notes payable and lines of credit 808,507
 745,506
Other current liabilities 117,464
 38,781
Total current liabilities 4,172,898

3,296,318
Notes payable and other obligations, less current portion 2,933,976
 2,521,727
Deferred income taxes 742,498
 668,580
Other noncurrent liabilities 50,504
 56,069
Total noncurrent liabilities 3,726,978

3,246,376
Commitments and contingencies (Note 12) 
 
Stockholders’ equity:    
Common stock, $0.001 par value; 475,000,000 shares authorized; 121,837,990 shares issued and 89,558,913 shares outstanding at September 30, 2017; and 121,259,960 shares issued and 91,836,938 shares outstanding at December 31, 2016 122
 121
Additional paid-in capital 2,165,326
 2,074,094
Retained earnings 2,676,224
 2,218,721
Accumulated other comprehensive loss (466,367) (666,403)
Less treasury stock 32,279,077 shares at September 30, 2017 and 29,423,022 shares at December 31, 2016 (944,887) (542,495)
Total stockholders’ equity 3,430,418

3,084,038
Total liabilities and stockholders’ equity $11,330,294

$9,626,732
1
See accompanying notes to unaudited consolidated financial statements.


FleetCorFLEETCOR Technologies, Inc. and Subsidiaries
Unaudited Consolidated Statements of Income
(In Thousands, Except Per Share Amounts)
  Three Months Ended
September 30,		 Nine Months Ended
September 30,
  2017 2016 2017 2016
Revenues, net $577,877
 $484,426
 $1,639,547
 $1,316,593
Expenses:        
Merchant commissions 27,687
 28,214
 82,690
 78,755
Processing 111,283
 96,233
 316,429
 256,738
Selling 45,060
 34,180
 122,854
 92,680
General and administrative 92,043
 77,904
 275,046
 209,084
Depreciation and amortization 69,156
 57,084
 198,731
 141,848
Other operating, net 11
 (244) 49
 (690)
Operating income 232,637

191,055
 643,748

538,178
Investment loss (income) 47,766
 2,744
 52,497
 (2,247)
Other (income) expense, net (175,271) 293
 (173,626) 1,056
Interest expense, net 29,344
 17,814
 76,322
 49,905
Loss on extinguishment of debt 3,296
 —
 3,296
 —
Total other (income) expense (94,865)
20,851
 (41,511)
48,714
Income before income taxes 327,502
 170,204
 685,259
 489,464
Provision for income taxes 124,679
 40,586
 227,756
 132,503
Net income $202,823

$129,618
 $457,503

$356,961
Basic earnings per share $2.23
 $1.40
 $4.99
 $3.85
Diluted earnings per share $2.18
 $1.36
 $4.87
 $3.75
Weighted average shares outstanding:        
Basic shares 90,751
 92,631
 91,619
 92,604
Diluted shares 93,001
 95,307
 93,923
 95,204
 Three Months Ended
June 30,		Six Months Ended
June 30,
 2021202020212020
Revenues, net$667,381 $525,146 $1,276,004 $1,186,239 
Expenses:
Processing122,294 121,290 238,722 354,993 
Selling63,225 42,374 115,307 98,233 
General and administrative115,008 86,739 223,370 192,849 
Depreciation and amortization69,218 62,162 134,947 126,638 
Other operating, net24 (230)81 (268)
Operating income297,612 212,811 563,577 413,794 
Investment gain0 (33,709)(9)(31,338)
Other expense (income), net408 2,480 2,151 (6,886)
Interest expense, net34,685 32,412 63,236 68,091 
Total other expense35,093 1,183 65,378 29,867 
Income before income taxes262,519 211,628 498,199 383,927 
Provision for income taxes66,272 53,140 117,713 78,379 
Net income$196,247 $158,488 $380,486 $305,548 
Basic earnings per share$2.36 $1.89 $4.57 $3.62 
Diluted earnings per share$2.30 $1.83 $4.45 $3.50 
Weighted average shares outstanding:
Basic shares83,141 83,895 83,307 84,399 
Diluted shares85,295 86,570 85,528 87,380 
See accompanying notes to unaudited consolidated financial statements.





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FleetCor
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FLEETCOR Technologies, Inc. and Subsidiaries
Unaudited Consolidated Statements of Comprehensive Income (Loss)
(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
June 30,		Six Months Ended
June 30,
 2021202020212020
Net income$196,247 $158,488 $380,486 $305,548 
Other comprehensive income (loss):
Foreign currency translation gains (losses), net of tax206,805 8,257 77,648 (566,861)
Net change in derivative contracts, net of tax9,037 1,892 20,333 (42,649)
Total other comprehensive income (loss)215,842 10,149 97,981 (609,510)
Total comprehensive income (loss)$412,089 $168,637 $478,467 $(303,962)
See accompanying notes to unaudited consolidated financial statements.



3
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, 2020$126 $2,749,900 $5,416,945 $(1,363,158)$(3,448,402)$3,355,411 
Net income— — 184,239 — — 184,239 
Other comprehensive loss, net of tax— — — (117,861)— (117,861)
Acquisition of common stock— — — — (170,382)(170,382)
Share-based compensation— 17,747 — — — 17,747 
Issuance of common stock1 27,344 — — — 27,345 
Balance at March 31, 2021127 2,794,991 5,601,184 (1,481,019)(3,618,784)3,296,499 
Net income— — 196,247 — — 196,247 
Other comprehensive income, net of tax— — — 215,842 — 215,842 
Acquisition of common stock— — — — (246,203)(246,203)
Share-based compensation— 17,885 — — — 17,885 
Issuance of common stock8,577 — — — 8,577 
Balance at June 30, 2021$127 $2,821,453 $5,797,431 $(1,265,177)$(3,864,987)$3,488,847 
Common
Stock		Additional
Paid-In
Capital		Retained
Earnings		Accumulated
Other
Comprehensive
Loss		Treasury
Stock		Total
Balance at December 31, 2019$124 $2,494,721 $4,712,729 $(972,465)$(2,523,493)$3,711,616 
Net income— — 147,060 — — 147,060 
Other comprehensive loss, net of tax— — — (619,659)— (619,659)
Acquisition of common stock— 75,000 — — (605,237)(530,237)
Share-based compensation— 14,175 — — — 14,175 
Issuance of common stock1 73,273 — — — 73,274 
Balance at March 31, 2020125 2,657,169 4,859,789 (1,592,124)(3,128,730)2,796,229 
Net income— — 158,488 — — 158,488 
Other comprehensive income, net of tax— — — 10,149 — 10,149 
Acquisition of common stock— — — — (32,230)(32,230)
Share-based compensation— 8,989 — — — 8,989 
Issuance of common stock1 24,808 — — — 24,809 
Balance at June 30, 2020$126 $2,690,966 $5,018,277 $(1,581,975)$(3,160,960)$2,966,434 

See accompanying notes to unaudited consolidated financial statements.

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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

 Six Months Ended
June 30,
 20212020
Operating activities
Net income$380,486 $305,548 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation36,094 31,607 
Stock-based compensation35,632 23,164 
Provision for credit losses on accounts and other receivables8,521 139,000 
Amortization of deferred financing costs and discounts3,248 2,886 
Amortization of intangible assets and premium on receivables98,853 95,031 
Loss on extinguishment of debt6,230 0 
Deferred income taxes12,897 (8,730)
Investment gain(9)(31,338)
Other81 (268)
Changes in operating assets and liabilities (net of acquisitions/dispositions):
Accounts and other receivables(706,574)359,685 
Prepaid expenses and other current assets115,239 46,216 
Other assets20,715 828 
Accounts payable, accrued expenses and customer deposits345,029 (161,461)
Net cash provided by operating activities356,442 802,168 
Investing activities
Acquisitions, net of cash acquired(114,994)(492)
Purchases of property and equipment(45,765)(36,870)
Other(2,281)0 
Net cash used in investing activities(163,040)(37,362)
Financing activities
Proceeds from issuance of common stock35,921 92,977 
Repurchase of common stock(416,585)(557,361)
Borrowings (payments) on securitization facility, net300,000 (316,973)
Deferred financing costs and debt discount(21,039)(974)
Proceeds from notes payable1,150,000 0 
Principal payments on notes payable(419,250)(92,910)
Borrowings from revolver405,000 573,500 
Payments on revolver(623,851)(726,644)
Payments on swing line of credit, net(51,157)(3,879)
Other(366)(169)
Net cash provided by (used in) financing activities358,673 (1,032,433)
Effect of foreign currency exchange rates on cash30,609 (216,264)
Net increase (decrease) in cash and cash equivalents and restricted cash582,684 (483,891)
Cash and cash equivalents and restricted cash, beginning of period1,476,619 1,675,237 
Cash and cash equivalents and restricted cash, end of period$2,059,303 $1,191,346 
Supplemental cash flow information
Cash paid for interest$54,818 $68,454 
Cash paid for income taxes$113,969 $56,790 
See accompanying notes to unaudited consolidated financial statements.


FleetCor
5

FLEETCOR Technologies, Inc. and Subsidiaries
Notes to Unaudited Consolidated Financial Statements
SeptemberJune 30, 20172021
1. Summary of Significant Accounting Policies
Basis of Presentation
Throughout this report,Current Report on Form 10-Q, the terms “our,” “we,” “us,” and the “Company” refers to FleetCorFLEETCOR 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 footnotesnotes required by accounting principles generally accepted in the United States (“GAAP”). 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, 2016.2020.
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 as of June 30, 2021 and through the date of this Report. The accounting estimates used in the preparation of the Company’s 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 magnitude and duration of the COVID-19 pandemic, 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 directlyrecorded to accumulated other comprehensive income. 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 $0.7 million in the three months ended September 30, 2017 and 2016, respectively,(losses), which are recorded within other expense (income) expense,, net in the Unaudited Consolidated Statements of Income. Income for the three and six months ended June 30 as follows (in millions):
Three Months Ended June 30,Six Months Ended June 30,
2021202020212020
Foreign exchange (losses)$(0.6)$(2.4)$(1.7)$(0.5)
The Company recognizedrecorded foreign exchangecurrency gains on long-term intra-entity transactions included as a component of foreign currency translation losses, net of $0.2 million and $1.5 milliontax, in the nine month periodsUnaudited Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended SeptemberJune 30 2017 and 2016, respectively.as follows (in millions):
Three Months Ended June 30,Six Months Ended June 30,
2021202020212020
Foreign currency gains on long-term intra-entity transactions$92.2 $21.4 $25.8 $185.5 
Derivatives

With its acquisition of Cambridge Global Payments ("Cambridge") in August 2017, theThe Company uses derivatives to minimize its exposures related to changes in interest rates and to facilitate cross-currency corporate payments by writing derivatives to customers, whichcustomers.
The Company is exposed to the risk of changing interest rates because its borrowings are notsubject to variable interest rates. In order to mitigate this risk, the Company utilizes derivative instruments. Interest rate swap contracts designated as hedging instruments.cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments
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over the life of the agreements without exchange of the underlying notional amount. The Company hedges a portion of its variable rate debt utilizing derivatives designated as cash flow hedges.
Changes in the fair value of derivatives that are designated and qualify as cash flow hedges are recorded to the derivative assets/liabilities and offset against accumulated other comprehensive income (loss), net of tax. Derivative fair value changes that are recorded in accumulated other comprehensive income (loss) are reclassified to earnings in the same period or periods that the hedged item affects earnings, to the extent the derivative is effective in offsetting the change in cash flows attributable to the hedged risk. The portions of the change in fair value that are either considered ineffective or are excluded from the measure of effectiveness are recognized immediately within earnings.
In the Company's cross-border payments business, the majority of this business' revenue is from exchanges of currency at spot rates, which enableenables customers to make cross-currency payments. In addition, this business alsothe Company writes foreign currency forward and option contracts for its customers to facilitate future payments. The duration of these derivative contracts at inception is generally less than one year. The Company aggregates its foreign exchange exposures arising from customer contracts, including forwards, options and spot exchanges of currency, as necessary, and economically hedges (economic hedge) the resulting net currency risks by entering into offsetting contractsderivatives with established financial institution counterparties. The changes in fair value related toof these contractsderivatives are recorded in revenues, net in the Unaudited Consolidated Statements of Income.
The Company recognizes allcurrent cross-border payments derivatives in "prepaid expensesprepaid expense and other current assets"assets and "otherother current liabilities"liabilities and derivatives greater than one year in other assets and other noncurrent liabilities in the accompanying Consolidated Balance Sheets at their fair value. All cash flows associated with derivatives are included in cash flows from operating activities in the Unaudited Consolidated Statements of Cash Flows. Refer to Note 13.
Cash, Cash Equivalents, and Restricted Cash
Cash equivalents consist of cash on hand and highly liquid investments with original maturities of three months or less. Restricted cash represents customer deposits repayable on demand, as well as 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, as well as secure and settle cross-currency transactions.
Financial Instruments - Credit Losses
The Company accounts for financial assets' expected credit losses in accordance with ASC 326. 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 categories, including Corporate Payments, Fuel, Lodging, Tolls, as well as Gift (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 solutions. 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, represent approximately 75% of total consolidated revenues, net, for both the three and six months ended June 30, 2021. The Company accounts for revenues comprised of 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. The Company also writes foreign currency forward and option contracts for its customers to facilitate future payments in foreign currencies, and recognizes revenue in accordance with authoritative fair value and derivatives accounting (ASC 815, "Derivatives").
7

Disaggregation of Revenues
The Company provides its services to customers across different payment solutions and geographies. Revenue by solution (in millions) for the three and six months ended June 30 was as follows:
Revenues, net by Solution Category*Three Months Ended June 30,Six Months Ended June 30,
2021%2020%2021%2020%
Fuel$295.1 44 %$249.8 48 %$557.0 44 %$541.9 46 %
Corporate Payments140.4 21 %92.6 18 %256.8 20 %212.5 18 %
Tolls71.3 11 %64.8 12 %140.3 11 %147.8 12 %
Lodging62.2 9 %40.6 8 %121.3 10 %97.6 8 %
Gift32.3 5 %26.5 5 %75.7 6 %68.9 6 %
Other66.0 10 %50.8 10 %124.9 10 %117.5 10 %
Consolidated revenues, net667.4 100 %525.1 100 %$1,276.0 100 %$1,186.2 100 %
*Columns may not calculate due to rounding.
Revenue by geography (in millions) for the three and six months ended June 30 was as follows:
Revenues, net by Geography*Three Months Ended June 30,Six Months Ended June 30,
2021%2020%2021%2020%
United States$412.7 62 %$334.9 64 %$783.3 61 %$732.8 62 %
Brazil85.7 13 %75.1 14 %167.6 13 %174.1 15 %
United Kingdom83.6 13 %49.0 9 %159.2 12 %122.6 10 %
Other85.4 13 %66.1 13 %166.0 13 %156.7 13 %
Consolidated revenues, net$667.4 100 %$525.1 100 %$1,276.0 100 %$1,186.2 100 %
*Columns may not calculate due to rounding.
Contract Liabilities
Deferred revenue contract liabilities for customers subject to ASC 606 were $66.3 million and $73.0 million as of June 30, 2021 and December 31, 2020, respectively. We expect to recognize approximately $41.4 million of these amounts in revenues within 12 months and the remaining $24.9 million over the next five years as of June 30, 2021. Revenue recognized in the six months ended June 30, 2021 that was included in the deferred revenue contract liability as of December 31, 2020 was approximately $27.7 million.
Spot Trade Offsetting
The Company uses spot trades to facilitate cross-currency corporate payments in its cross-border payments business. In accordance with ASC Subtopic 210-20, "Offsetting," the Company applies offsetting to spot trade assets and liabilities associated with contracts 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 trade liabilities against spot trade receivables at the counter-party level. The Company recognizes all spot trade assets, net in accounts receivable and all spot trade liabilities, net in accounts payable, each net at the customer level, in its Consolidated Balance Sheets at their fair value. The following table presents the Company’s spot trade assets and liabilities at their fair value at June 30, 2021 and December 31, 2020 (in millions):
June 30, 2021December 31, 2020
GrossOffset on the Balance SheetNetGrossOffset on the Balance SheetNet
Assets
Accounts Receivable$2,330.2 $(2,239.7)$90.5 $521.5 $(478.2)$43.3 
Liabilities
Accounts Payable$2,285.0 $(2,239.7)$45.3 $527.5 $(478.2)$49.3 

8
Table of Contents

Adoption of New Accounting Standards
Revenue RecognitionIncome Taxes
In May 2014,On December 18, 2019, the FASBFinancial Accounting Standards Board (FASB) issued ASU 2014-09, "Revenue from Contracts with Customers2019-12, Income Taxes (Topic 606)." The core principle740), Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which removes certain exceptions to the general principles of ASU 2014-09 is that an entity should recognize revenue to depictASC 740 and simplifies other areas. For public business entities, the transfer of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchangeamendments are effective 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 forfiscal years beginning after December 15, 2017,2020, including interim periods within those fiscal years, 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.

permitted. The Company has performed a review of the requirements of the new revenue standard and is monitoring the activity of the FASB 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 newadopted this 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,2021, which would result in an adjustment to retained earnings for the cumulative effect, if any, of applying the standard to contracts that aredid 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 Company's results of operations, financial condition, or cash flows.
Cash Flow ClassificationPending Adoption of Recently Issued Accounting Standard
Reference Rate Reform
In August 2016,March 2020, the FASB issued ASU 2016-15, "Classification of Certain Cash Receipts and Cash Payments"2020-04, Reference Rate Reform (Topic 848) ("ASU 2020-04"), 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 relatedprovides optional expedients and exceptions to the classification ofcontracts, hedging relationships, and other transactions affected by reference rate reform if 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.criteria are met. The amendments in this ASU shouldupdate apply only to contracts, hedging relationships, and other transactions that reference London Inter-bank Offered Rate ("LIBOR") or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022 for which an entity has elected certain optional expedients and are retained through the end of the hedging relationship. The amendments in this update also include a general principle that permits an entity to consider contract modifications due to reference rate reform to be an event that does not require contract remeasurement at the modification date or reassessment of a previous accounting determination. If elected, the optional expedients for contract modifications must be applied using a retrospective transition methodconsistently for all eligible contracts or eligible transactions within the relevant ASC Topic or Industry Subtopic that contains the guidance that otherwise would be required to each period presented.be applied. The amendments in this update were effective upon issuance and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. The Company is evaluating what impact if any the adoptioneffect of ASU 2020-04 on interest rate swap contracts. Cross currency derivatives are not impacted by this ASU will have on the results of operations, financial condition, or cash flows.ASU.
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 Receivableand Other Receivables
The Company's accounts and securitized accounts receivable include the following at June 30, 2021 and December 31, 2020 (in thousands):
June 30, 2021December 31, 2020
Gross domestic accounts receivable$912,289 $719,675 
Gross domestic securitized accounts receivable1,000,000 700,000 
Gross foreign receivables966,966 733,986 
Total gross receivables2,879,255 2,153,661 
Less allowance for credit losses(92,100)(86,886)
Net accounts and securitized accounts receivable$2,787,155 $2,066,775 
The Company maintains a $950 million$1 billion revolving trade accounts receivable Securitization Facility.securitization facility (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 certain of its domestic receivables, on a revolving basis, to FleetCorFLEETCOR Funding LLC (Funding), a wholly-owned bankruptcy remote subsidiary. In turn, Funding sells,transfers, without recourse, on a revolving basis, up to $950 million ofan undivided ownership interestsinterest in this pool of accounts receivable to a multi-seller banks and asset-backed commercial paper conduitconduits (Conduit). Funding maintains a subordinated interest, in the form of over-collateralization, in a portion of the receivables sold to the Conduit.sold. Purchases by the Conduit are financed with the sale of highly-rated commercial paper.
The Company utilizes proceeds from the sale of its accounts receivabletransferred 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 soldtransferred asset 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 sheetsConsolidated Balance Sheets and statementsStatements of incomeIncome reflect the activity related to securitized accounts receivable and the corresponding securitized debt, including interest income, fees generated from late payments, provision for
9

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. On March 29, 2021, the Company entered into the eighth amendment to the Securitization Facility. The amendment included a new three year maturity date, reduced the LIBOR floor to 0 bps, improved margins, and increased the swing line from $100 million to $250 million. The maturity date for the Company's Securitization Facility is March 29, 2024.
The Company’s accountsCompany recorded a $90.1 million provision for credit losses and write-off related to a customer receivable and securitized accounts receivable includein our foreign currency trading business during the following at Septemberfirst quarter of 2020. The Company's estimated expected credit losses as of June 30, 2017 and December 31, 2016 (in thousands):
  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
2021 included estimated adjustments for economic conditions related to COVID-19. A rollforward of the Company’s allowance for doubtful accountscredit losses related to accounts receivable for ninethe six months ended SeptemberJune 30 is as follows (in thousands):
20212020
Allowance for credit losses beginning of period$86,886 $70,890 
Provision for credit losses8,521 139,000 
Write-offs(14,878)(119,210)
Recoveries1
9,956 5,443 
Impact of foreign currency1
1,615 (7,759)
Allowance for credit losses end of period$92,100 $88,364 
  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
1Comparable disclosure provided to conform with 2021 presentation. Activity previously included within write-offs.
3. Fair Value 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. 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.
As the basis for evaluating such inputs, 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
10
Table of observable inputs and minimize the use of unobservable inputs when measuring fair value.Contents


The following table presents the Company’s financial assets and liabilities which are measured at fair valuesvalue on a recurring basis as of Septemberat June 30, 20172021 and December 31, 2016,2020, (in thousands).:
Fair ValueLevel 1Level 2Level 3
June 30, 2021
Assets:
Repurchase agreements$428,545 $0 $428,545 $0 
Money market43,739 0 43,739 0 
Certificates of deposit928 0 928 0 
       Foreign exchange contracts165,840 0 165,840 0 
Total assets$639,052 $0 $639,052 $0 
Cash collateral for foreign exchange contracts$39,534 $0 $0 $0 
Liabilities:
Interest rate swaps$60,987 $0 $60,987 0 
       Foreign exchange contracts115,381 0 115,381 0 
Total liabilities$176,368 $0 $176,368 $0 
Cash collateral obligation for foreign exchange contracts$49,721 $0 $0 $0 
 
December 31, 2020
Assets:
Repurchase agreements$446,116 $0 $446,116 $0 
Money market48,227 0 48,227 0 
Certificates of deposit188 0 188 0 
Foreign exchange contracts155,846 0 155,846 0 
Total assets$650,377 $0 $650,377 $0 
Cash collateral for foreign exchange contracts$18,229 $0 $0 $0 
Liabilities:
Interest rate swaps$87,873 $0 $87,873 $0 
 Foreign exchange contracts140,272 0 140,272 0 
Total liabilities$228,145 $0 $228,145 $0 
Cash collateral obligation for foreign exchange contracts$38,569 $0 $0 $0 
  Fair Value Level 1 Level 2 Level 3
September 30, 2017        
Assets:        
Repurchase agreements $363,335
 $—
 $363,335
 $—
Money market 50,341
 —
 50,341
 —
Certificates of deposit 9,370
 —
 9,370
 —
       Foreign exchange contracts 111,235
 28
 111,207
 —
Total assets $534,281

$28

$534,253

$—
Cash collateral for foreign exchange contracts $33,911
 $—
 $—
 $—
         
Liabilities:        
      Foreign exchange contracts contracts $106,175
 $353
 $105,822
 —
Total liabilities $106,175
 $353
 $105,822
  
Cash collateral obligation for foreign exchange contracts $20,272
 $—
 $—
 $—
         
December 31, 2016        
Assets:        
Repurchase agreements $232,131
 $—
 $232,131
 $—
Money market 50,179
 —
 50,179
 —
Certificates of deposit 48
 —
 48
 —
Total cash equivalents $282,358

$—

$282,358

$—


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 repurchase agreements, money markets and certificates of deposit. 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 tradeabletradable and must be settled directly by us with the respective financial institution. Certificates of deposit 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 asapproximates the fair value of these instruments. The fair value represents what would be received and or paid by the Companynet settlement if the contracts were terminated as of the reporting date. Cash collateral received for foreign exchange derivatives is recorded within customer deposits in our Unaudited Consolidated Balance SheetsSheet at SeptemberJune 30, 2017.2021. Cash collateral paiddeposited for foreign exchange derivatives is recorded within restricted cash and cash equivalents in our Unaudited Consolidated Balance SheetsSheet at SeptemberJune 30, 2017.2021.
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 2017June 30, 2021 and 2016.December 31, 2020.
The Company’s assets that are measured at fair value on a nonrecurring basis andor 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
11

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. See footnote 13 for discussion
The Company determines the fair values of Masternaut'sits 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 than temporary decline interms of the derivatives, such as interest rates, foreign currency exchange rates, commodity rates or other financial indices. The Company's derivatives are over-the-counter instruments with liquid markets.
The Company regularly evaluates the carrying value of its investments. The carrying amount of investments without readily determinable fair value during the third quarter of 2017.values is $11.9 million at June 30, 2021.
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 basis. These are each Level 2 fair value measurements, except for cash, which is a Level 1 fair value measurement.measurements.
4. Stockholders' Equity
On February 4, 2016, the
The Company's Board of Directors (the "Board") has approved a stock repurchase program (the(as updated from time to time, the "Program") under whichauthorizing the Company may purchase up to an aggregate of $500 million ofrepurchase its common stock over the following 18 month period.from time to time until February 1, 2023. On July 27, 2017,2021, the Company's Board of Directors authorized an increase inincreased 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,$1 billion, to $5.1 billion, leaving 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 authorizedup to $1.6 billion available under the Program of $1.1 billion. With the increase and giving effect to the Company's $590.1 million of previousfor future repurchases the Company may repurchase up to $510 million in shares of its common stock at any time prior to February 1, 2019.stock. Since the beginning of the Program through June 30, 2021, 16,184,095 shares have been repurchased for an aggregate purchase price of $3.5 billion.
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.
On August 3, 2017, as part of the Program, the Company 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, the Company 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 was completed on September 7, 2017, at which time the Company received 263,012 additional shares based on a final weighted average per share purchase price during the repurchase period of $142.48.
The Company 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 the Company's 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, and these amounts 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 $590.1 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 a Stock Incentive PlansPlan (the Plans) pursuant to"Plan") which permits the Company’s Board of Directors mayto grant stock options or restricted stockshare based payment awards to employees. employees and directors.
The table below summarizes the expense recognized related to share-based payments recognized forin the three and nine month periodssix months ended SeptemberJune 30 (in thousands):
  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
 Three Months Ended
June 30,		Six Months Ended
June 30,
 2021202020212020
Stock options$5,012 $5,755 $9,602 $12,774 
Restricted stock12,873 3,235 26,030 10,390 
Stock-based compensation$17,885 $8,990 $35,632 $23,164 
The tax benefits recorded on stock based compensation were $36.1$24.5 million and $28.4$37.4 million for the nine month periodssix months ended SeptemberJune 30, 20172021 and 2016,2020, respectively.
The following table summarizes the Company’s total unrecognized compensation cost related to stock-based compensation as of SeptemberJune 30, 20172021 (cost in thousands):

Unrecognized
Compensation
Cost		Weighted Average
Period of Expense
Recognition
(in Years)
Stock options$39,904 2.52
Restricted stock53,876 2.18
Total$93,780 

12
  
Unrecognized
Compensation
Cost
 
Weighted Average
Period of Expense
Recognition
(in Years)
Stock options $96,594
 1.52
Restricted stock 12,425
 0.43
Total $109,019
  
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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 periodsix months ended SeptemberJune 30, 2017 (shares2021 (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, 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
        
SharesWeighted
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, 20204,964 $146.69 3,994 $130.37 $626,107 
Granted162 264.59 $81.04 
Exercised(432)81.73 75,305 
Forfeited(10)236.67 
Outstanding at June 30, 20214,684 $156.56 3,791 $141.34 $465,987 
Expected to vest as of June 30, 2021893 $221.19 
The aggregate intrinsic value of stock options exercisable at SeptemberJune 30, 20172021 was $330.4$434.9 million. The weighted average remaining contractual term of options exercisable at SeptemberJune 30, 20172021 was 5.14.7 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:six months ended June 30, 2021 and 2020:
 September 30, June 30,
 2017 2016 20212020
Risk-free interest rate 1.65% 1.09%Risk-free interest rate0.34 %0.38 %
Dividend yield —
 —
Dividend yield0 0 
Expected volatility 28.02% 27.37%Expected volatility35.08 %30.88 %
Expected life (in years) 3.4
 3.4
Expected life (in years)3.83.9
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, performance or performance,market conditions, or a combination of these. Shares vesting based on the passage of time have vesting provisions of one to threefour years.
The following table summarizes the changes in the number of shares of restricted stock and restricted stock units for the ninesix months ended SeptemberJune 30, 20172021 (shares in thousands):

SharesWeighted
Average
Grant Date
Fair Value
Outstanding at December 31, 2020174 $265.29 
Granted210 272.99 
Vested(64)258.39 
Canceled or forfeited(26)285.05 
Outstanding at June 30, 2021294 $270.48 

13
  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
20172021 Acquisitions

Cambridge Global Payments

AFEX
On August 9, 2017,June 1, 2021, the Company acquired Cambridge,completed the acquisition of Associated Foreign Exchange (AFEX), a leading business to business (B2B) international paymentsU.S. based, cross-border payment solutions provider for approximately $584.1$418.7 million. This includes $210.3 million in cash, net of cash acquiredand cash equivalents and $178.7 million of $132.3 million and inclusiverestricted cash, resulting in a net purchase price of a note payable of $23.9$29.7 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.cross border payment solutions. The Company financed the acquisition using a combination of existingavailable cash and borrowings under its existing credit facility. The results from Cambridgethe acquisition are reported in itsthe North America segmentsegment.
In connection with this acquisition, the Company signed noncompete agreements with certain parties affiliated with the business for which the Company is still completing the valuation. These noncompete agreements were accounted for separately from the business inacquisition. Acquisition accounting for AFEX is preliminary as the United StatesCompany is still completing the valuation for goodwill, intangible assets, derivatives, income taxes, working capital, and Canada and within its International segment for business in all other countries outsideevaluation of the United States and Canada, since acquisition. acquired contingencies.
The following table summarizes the preliminary acquisition accounting for CambridgeAFEX (in thousands):
Current assets$116,762 
Long term assets49,131 
Goodwill265,910 
Intangibles184,200 
Current liabilities(490,839)
Noncurrent liabilities(95,508)
Aggregate purchase price$29,656 
Prepaid expenses and other79,725
Property and equipment7,106
Other long term assets10,025
Goodwill436,138
Customer relationships and other identifiable intangible assets358,168
Liabilities assumed(187,664)
Deferred tax liabilities(119,419)
Aggregate purchase price$584,079
  
Roger
On January 13, 2021, the Company completed the acquisition of Roger, rebranded CorpayOne, a global accounts payable (AP) cloud software platform for small businesses, for $39.0 million, net of cash acquired. The Company financed the acquisition using a combination of available cash and borrowings under its existing credit facility. The results from the acquisition are reported in the North America segment. Acquisition accounting for Roger is preliminary as the Company is still completing the valuation for goodwill, intangible assets, income taxes, working capital, and evaluation of acquired contingencies.
The following table summarizes the preliminary acquisition accounting for Roger (in thousands):
Accounts and other receivables$110 
Prepaid expenses and other current assets37 
Other assets28 
Goodwill34,533 
Other intangibles6,900 
Current liabilities(925)
Deferred income taxes(1,691)
Aggregate purchase price$38,992 
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
Proprietary Technology10$5,600 
Customer Relationships91,300 
$6,900 
 Useful Lives (in Years)Value
Customer relationships and other identifiable intangible assets10$358,168
  $358,168
Other

Acquisition accounting for Cambridge is preliminary asDuring 2021, the Company is still completingmade investments in other businesses of $4.4 million. The Company financed the valuation for goodwill, intangible assets, income taxes, certain acquired contingencies, derivativesinvestments using a combination of available cash and the working capital adjustment period remains open. Goodwill recorded is comprised primarilyborrowings under its existing credit facility.
14
Table of expected synergies from combining the operations ofContents

On July 28, 2021, the Company and Cambridge, as well as assembled workforce. The allocation of the goodwillsigned a definitive agreement to acquire ALE Solutions, Inc. (ALE), a U.S. based leader in lodging solutions to the reporting unitsinsurance industry, for approximately $400 million. The transaction is not yet complete.expected to close during the third quarter of 2021, subject to regulatory approval and closing conditions.

Other

2020 Acquisitions
On September 26, 2017,August 10, 2020, the Company acquiredcompleted the acquisition of a business in the lodging space in the U.S. The results from the acquisition are reported in the North America segment. On November 30, 2020, the Company completed the acquisition of a fuel card provider in Russia.New Zealand. The accountingresults from the acquisition are reported in the International segment. The aggregate purchase price of these acquisitions was approximately $78.4 million, net of cash acquired. The Company financed these acquisitions using a combination of available cash and borrowings under its existing credit facility. The Company signed noncompete agreements with certain parties affiliated with the lodging business with an estimated fair value of $3.8 million. These noncompete agreements were accounted for this acquisition is preliminary asseparately from the Company is still completing the valuation of goodwill, intangible assets, income taxes and evaluation of acquired contingencies. business acquisitions.
The following table summarizes the preliminary acquisition accounting for the Russian acquisition (in thousands):

Trade and other receivables$8,175
Prepaid expenses and other783
Property and equipment206
Goodwill9,209
Other intangible assets46,034
Liabilities assumed(11,078)
Deferred tax liabilities(9,211)
Aggregate purchase prices$44,118
Accounts and other receivables$5,487 
Prepaid expenses and other current assets930 
Property and equipment3,178 
Other assets1,049 
Goodwill27,526 
Other intangibles42,144 
Current liabilities(1,147)
Deferred income taxes(782)
Aggregate purchase price$78,385 
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 assets8$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 other6,998
Deferred tax assets20,644
Property and equipment44,226
Other long term assets14,280
Goodwill663,040
Customer relationships and other identifiable intangible assets548,682
Liabilities assumed(315,082)
Aggregate purchase price$1,225,945
  
Useful Lives (in Years)Value
Trade Name and Trademarks5$2,161 
Licensed Software and Technology104,400 
Proprietary Technology58,400 
Supplier Network10783 
Customer Relationships1626,400 
$42,144 
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 relationships8.5-20$348,414
Trade names and trademarks - indefiniteN/A154,851
Technology645,417
  $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 other5,097
Property and equipment992
Goodwill28,540
Other intangible assets61,823
Deferred tax asset146
Liabilities assumed(42,550)
Deferred tax liabilities(5,123)
Aggregate purchase prices$76,735
The estimated fair valueis preliminary as the Company is still completing the valuation of certain goodwill, intangible assets, acquiredincome taxes and the related estimated useful lives consisted of the following (in thousands):working capital adjustments.

 Useful Lives (in Years)Value
Customer relationships and other identifiable intangible assets10-18$61,823
  $61,823
7. Goodwill and Other Intangible AssetsIntangibles
A summary of changes in the Company’s goodwill by reportable business segment is as follows (in thousands):
December 31, 2020AcquisitionsAcquisition Accounting
Adjustments		Foreign
Currency		June 30, 2021
Segment
North America$3,400,772 $300,098 $230 $11,003 $3,712,103 
Brazil585,861 0 0 26,203 612,064 
International732,548 0 (1,294)2,753 734,007 
$4,719,181 $300,098 $(1,064)$39,959 $5,058,174 

15

  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 related to our acquisition 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. As of SeptemberJune 30, 20172021 and December 31, 2016,2020, other intangible assetsintangibles 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
  June 30, 2021December 31, 2020
 Weighted-
Avg
Useful
Lives
(Years)		Gross
Carrying
Amounts		Accumulated
Amortization		Net
Carrying
Amount		Gross
Carrying
Amounts		Accumulated
Amortization		Net
Carrying
Amount
Customer and vendor relationships16.2$2,770,777 $(1,103,630)$1,667,147 $2,671,104 $(1,105,702)$1,565,402 
Trade names and trademarks—indefinite livedN/A462,153 — 462,153 475,376 — 475,376 
Trade names and trademarks—other6.412,202 (3,670)8,532 7,041 (3,431)3,610 
Software5.6267,255 (191,874)75,381 248,686 (194,187)54,499 
Non-compete agreements2.699,059 (46,698)52,361 65,804 (48,809)16,995 
Total other intangibles$3,611,446 $(1,345,872)$2,265,574 $3,468,011 $(1,352,129)$2,115,882 
Changes in foreign exchange rates resulted in a $53.8$10.7 million increase to the net carrying values of other intangible assetsintangibles in the ninesix months ended SeptemberJune 30, 2017.2021. Amortization expense related to intangible assets for the ninesix months ended SeptemberJune 30, 20172021 and 20162020 was $158.9$97.3 million and $112.5$92.8 million, respectively. 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, resulting in a $41.8 million reduction in the net carrying values of other intangible assets.


8. Debt
The Company’s debt instruments consist primarily of term notes,loans, revolving lines of credit and a Securitization Facility as follows (in thousands):
  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
June 30, 2021December 31, 2020
Term Loan A note payable (a), net of discounts$2,842,618 $2,922,042 
Term Loan B note payable (a), net of discounts1,136,283 337,347 
Revolving line of credit A Facility (a)75,000 280,000 
Revolving line of credit B Facility (a)0 13,650 
Revolving line of credit B Facility —foreign swing line (a)0 50,028 
Other obligations (c)24,880 29,556 
Total notes payable and other obligations$4,078,781 $3,632,623 
Securitization Facility (b)1,000,000 700,000 
Total notes payable, credit agreements and Securitization Facility$5,078,781 $4,332,623 
Current portion$1,346,080 $1,205,697 
Long-term portion3,732,701 3,126,926 
Total notes payable, credit agreements and Securitization Facility$5,078,781 $4,332,623 
 ______________________
(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.
(a)The Company has a Credit Agreement that provides for senior secured credit facilities (collectively, the "Credit Facility") consisting of a revolving credit facility in the amount of $1.285 billion, a term loan A facility in the amount of $3.225 billion and a term loan B facility in the amount of $1.150 billion as of June 30, 2021. 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 Septemberwith sublimits for letters of credit and swing line loans, (b) a revolving B facility in the amount of $450 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 (c) a revolving C facility in the amount of $35 million forborrowings in U.S. dollars, Australian dollars or New Zealand dollars. The Credit Agreement also includes an accordion feature for borrowing an additional $750 million in term loan A, term loan B, revolving A or revolving B facility debt and an unlimited amount when the leverage ratio on a pro-forma basis is less than 3.00 to 1.00. Proceeds from the 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 facilities is December 19, 2023. On April 30, 2017. In August 2017,2021, the Company expensed $3.3 millionentered into the ninth amendment to the Credit Agreement. The amendment provided for
16
Table of Contents

a new seven-year $1.15 billion term loan B. The existing term loan B was paid off with proceeds from the new term loan B. The new term loan B has a maturity date of April 30, 2028, and capitalized $10.6 millioninterest rates remain unchanged.
Interest on amounts outstanding under the Credit Agreement (other than the term loan B) accrues based on the British Bankers Association LIBOR Rate (the "Eurocurrency Rate"), plus a margin based on a leverage ratio, or at our option, the Base Rate (defined as the rate equal to the highest of (a) the Federal Funds Rate plus 0.50%, (b) the prime rate announced by Bank of America, N.A., or (c) the Eurocurrency Rate plus 1.00%) plus a margin based on a leverage ratio. Interest on the term loan B facility accrues based on the Eurocurrency Rate plus 1.75% for Eurocurrency Loans or the Base Rate plus 0.75% for Base Rate Loans. The Eurocurrency rate has a 0% floor. In addition, the Company pays a quarterly commitment fee at a rate per annum ranging from 0.25% to 0.35% of the daily unused portion of the Credit Facility. At June 30, 2021, the interest rate on the term loan A was 1.60%, the interest rate on the term loan B was 1.85%, and the interest rate on the revolving A facility was 1.60%. The unused credit facility fee was 0.30% at June 30, 2021.
(b)The Company is party to a $1.0 billion Securitization Facility. On April 24, 2020, the Company reduced the Securitization Facility commitment from $1.2 billion to $1.0 billion. There is a program fee equal to one month LIBOR plus 1.00% or the Commercial Paper Rate plus 0.90% as of June 30, 2021, and one month LIBOR plus 1.25% or the Commercial Paper Rate plus 1.15% as of December 31, 2020. There is a LIBOR floor of 0% as of June 30, 2021 and a LIBOR floor of 0.38% as of December 31, 2020. The program fee was 0.98% plus 0.11% as of June 30, 2021 and 1.23% plus 0.34% as of December 31, 2020. The unused facility fee is payable at a rate of 0.40% per annum as of June 30, 2021 and December 31, 2020. We have unamortized debt issuance costs of $2.6 million and $1.4 million related to the Securitization Facility as of June 30, 2021 and December 31, 2020, respectively, recorded within other assets in the Unaudited Consolidated Balance Sheets. On March 29, 2021, the Company entered into the eighth amendment to the Securitization Facility. The amendment included a new three year maturity date, reduced the LIBOR floor to 0 bps, improved margins, and increased the swing line from $100 million to $250 million. The maturity date for the Company's Securitization Facility is March 29, 2024.
(c)Other obligations includes the long-term portion of deferred payments associated with the refinancing of its Credit Facility.business acquisitions and deferred revenue.
(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 at SeptemberJune 30, 2017.2021. The Company has entered into interest rate swap cash flow contracts with U.S. dollar notional amounts in order to reduce the variability of cash flows in the previously unhedged interest payments associated with $2.0 billion of variable rate debt. Refer to Note 13 for further details.


9. Income Taxes
The Company's tax provision or benefit from income taxes for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter the Company updates the estimate of the annual effective tax rate, and if our estimated tax rate changes, makes a cumulative adjustment. The Company's quarterly tax provision and quarterly estimate of the annual effective tax rate are subject to significant variation due to several factors, including variability in accurately predicting the pre-tax and taxable income and loss and the mix of jurisdictions to which they relate. Additionally, the Company's effective tax rate can be more or less volatile based on the amount of pre-tax income or loss. For example, the impact of discrete items and non-deductible expenses on our effective tax rate is greater when our pre-tax income is lower.
The provision for income taxes differs from amounts computed by applying the U.S. federal tax rate of 35%21% for 2021 and 2020 to income before income taxes for the three months ended SeptemberJune 30, 20172021 and 20162020 due to the following (in thousands):
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20212020
 2017 2016
Computed tax expense at the U.S. federal tax rate $114,626
 35.0 % $59,571
 35.0 %
Computed “expected” tax expenseComputed “expected” tax expense$55,129 21.0 %$44,443 21.0 %
Changes resulting from:        Changes resulting from:
Foreign income tax differential (9,247) (2.8)% (4,265) (2.5)%Foreign income tax differential(3,899)(1.5)%(4,155)(2.0)%
Excess tax benefits related to stock-based compensation (4,360) (1.3)% (8,247) (4.9)%
Excess tax benefit related to stock-based compensationExcess tax benefit related to stock-based compensation(6,059)(2.3)%(12,720)(6.0)%
State taxes net of federal benefits 5,926
 1.8 % 1,678
 1.0 %State taxes net of federal benefits2,949 1.1 %3,902 1.8 %
Foreign-sourced nontaxable income 1,558
 0.5 % (6,691) (3.9)%
Valuation allowance on investment loss 16,718
 5.1 % 960
 0.6 %
Change in UK statutory rateChange in UK statutory rate6,470 2.5 %0 0 %
Foreign withholdingForeign withholding(316)(0.1)%3,515 1.7 %
GILTI, net of foreign tax creditsGILTI, net of foreign tax credits2,899 1.1 %2,402 1.1 %
Foreign sourced non taxable incomeForeign sourced non taxable income50 0 %13 0 %
Change in taxes for federal uncertain tax positionsChange in taxes for federal uncertain tax positions4,800 1.8 %12,261 5.8 %
Other (542) (0.2)% (2,420) (1.4)%Other4,249 1.6 %3,479 1.7 %
Provision for income taxes $124,679
 38.1 % $40,586
 23.9 %Provision for income taxes$66,272 25.2 %$53,140 25.1 %

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 ninesix months ended SeptemberJune 30, 2021 and 2020 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
June 30,		Six Months Ended
June 30,
 2021202020212020
Net income$196,247 $158,488 $380,486 $305,548 
Denominator for basic earnings per share83,141 83,895 83,307 84,399 
Dilutive securities2,154 2,675 2,221 2,981 
Denominator for diluted earnings per share85,295 86,570 85,528 87,380 
Basic earnings per share$2.36 $1.89 $4.57 $3.62 
Diluted earnings per share$2.30 $1.83 $4.45 $3.50 
Diluted earnings per share for both the three month periodsmonths ended SeptemberJune 30, 20172021 and 2020 excludes the effect of 3.50.1 million sharesand 0.3 million, 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 0.30.2 million shares of performance based restricted stock for which the performance criteria have not yet been achieved for both the three month periods ended SeptemberJune 30, 20172021 and 2016,2020, respectively.

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11. Segments
The Company reports information about its operating segments in accordance with the authoritative guidance related to segments. The Company’sWe manage and report our operating results through 3 operating and reportable segments represent components of the business for which separate financial information is evaluated regularlydefined by the chief operating decision maker in determining how to allocate resources and in assessing performance. The Company operates in two reportable segments,geographic regions: North America, Brazil and International. The Company began reporting its results from Cambridge acquired inInternational, which aligns with how the third quarter of 2017 in its North America segment for Cambridge's business in the United StatesChief Operating Decision Maker (CODM) allocates resources, assesses performance 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 our International segment, from the date of acquisition. There were no inter-segment sales.reviews financial information.


The Company’s segment results are as follows for the three and ninesix month periods ended SeptemberJune 30, 2021 and 2020 (in thousands):
 Three Months Ended
June 30,		Six Months Ended
June 30,
 
20211
2020
20211
2020
Revenues, net:
North America$443,426 $357,430 $845,632 $792,122 
Brazil85,670 75,148 167,593 174,126 
International138,285 92,568 262,779 219,991 
$667,381 $525,146 $1,276,004 $1,186,239 
Operating income:
North America$178,652 $133,151 $341,228 $218,891 
Brazil33,331 29,420 65,556 68,862 
International85,629 50,240 156,793 126,041 
$297,612 $212,811 $563,577 $413,794 
Depreciation and amortization:
North America$43,882 $38,548 $84,415 $76,524 
Brazil12,894 12,169 25,181 26,758 
International12,442 11,445 25,351 23,356 
$69,218 $62,162 $134,947 $126,638 
Capital expenditures:
North America$15,325 $12,279 $26,855 $23,543 
Brazil5,775 3,477 9,126 6,808 
International5,138 2,857 9,784 6,519 
$26,238 $18,613 $45,765 $36,870 
  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 the 2021 acquisitions of Roger and AFEX are reported in our North America segment.
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 on behalf of the Company. The derivative complaintFederal Derivative Action 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 false

and misleading public statements concerning the Company’s fee charges, and financial and business prospects; and that certain defendants breached their fiduciary duties through allegedly improper sales of stock. The complaint seeks unspecified monetary damages on behalf of the Company, corporate governance reforms, disgorgement of profits, benefits and compensation by the defendants, restitution, costs, and attorneys’ and experts’ fees. On August 18, 2017,September 20, 2018, the court entered an order deferring the caseFederal Derivative Action pending a ruling on motions for summary judgment in the defendants' motion to dismissshareholder class action, notice a settlement has been reached in the putative shareholder class action, or until otherwise agreed to by the parties. After preliminary approval of the proposed settlement of the shareholder class action was granted, the stay on the Federal Derivative Action was lifted. Plaintiffs amended their complaint on February 22, 2020.
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FLEETCOR filed a motion to dismiss the amended complaint in the Federal Derivative Action on April 17, 2020, which the court granted without leave to amend on October 21, 2020. Plaintiffs filed a notice of appeal to the United States Court of Appeals for the Eleventh Circuit on November 18, 2020. The appeal is pending.

On January 9, 2019, a similar shareholder derivative complaint was filed in the Superior Court of Gwinnett County, Georgia (“State Derivative Action”), which was stayed pending a ruling on motions for summary judgment in the shareholder class action, notice a settlement has been reached in the shareholder class action, or until otherwise agreed by the parties. On the parties’ joint motion, the court has continued the stay of the State Derivative Action “pending further developments in the first-filed Federal Derivative Action.” The defendants dispute the allegations in the complaintderivative complaints and intend to vigorously defend against the claims.
Estimating an amountFTC 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; the briefing on both parties’ summary judgment motions was completed on July 12, 2021. The Company has incurred and continues to incur legal and other fees related to this 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. At this time, in view of the complexity and ongoing nature of the matter, we are unable to estimate a reasonably possible loss or range of possible losses resulting from litigation proceedings is inherently difficult and requires an extensive degree of judgment, particularly whereloss that we may incur to settle this matter or defend against the matters involve indeterminate claims for monetary damages, and are inlawsuit brought by 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.FTC.

13. Asset DispositionsDerivative 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 ofuses derivatives to facilitate cross-currency corporate payments by writing derivatives 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, 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 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 we are 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 terminationcounterparty 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.


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
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underlying exposures. Any ineffective portion of a financial instrument's change in fair value is immediately recognized in earnings.
The aggregate equivalent United StatesU.S. dollar notional amount of foreign exchange derivative customer contracts held by the Company as of SeptemberJune 30, 20172021 and December 31, 2020 (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.
Notional
June 30, 2021December 31, 2020
Foreign exchange contracts:
  Swaps$1,660.3 $684.5 
  Futures, forwards and spot7,355.5 5,467.8 
  Written options8,954.8 5,578.1 
  Purchased options8,399.2 5,195.0 
Total$26,369.8 $16,925.4 
 Net Notional
Foreign exchange contracts: 
  Swaps$272.8
  Futures, forwards and spot3,174.1
  Written options1,338.6
  Purchased options1,765.0
Total$6,550.5


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


The following table summarizes the fair value of foreign currency derivatives reported in the Unaudited Consolidated Balance SheetSheets as of SeptemberJune 30, 20172021 and December 31, 2020 (in millions):

June 30, 2021
Derivative Assets Derivative LiabilitiesFair Value, GrossFair Value, Net
Fair Value Fair ValueDerivative AssetsDerivative LiabilitiesDerivative AssetsDerivative Liabilities
Derivatives - undesignated:   Derivatives - undesignated:
Over the counter$111.2
 $105.8
Exchange traded—
 0.4
Foreign exchange contracts111.2
 106.2
Foreign exchange contracts$319.1 $268.7 $165.8 $115.4 
Cash collateral(33.9) (20.3)Cash collateral39.5 49.7 39.5 49.7 
Total net derivative assets and liabilities$77.3
 $85.9
Total net of cash collateralTotal net of cash collateral$279.6 $219.0 $126.3 $65.7 
December 31, 2020
Fair Value, GrossFair Value, Net
Derivative AssetsDerivative LiabilitiesDerivative AssetsDerivative Liabilities
Derivatives - undesignated:
Foreign exchange contracts$326.1 $310.5 $155.8 $140.3 
Cash collateral18.2 38.6 18.2 38.6 
Total net of cash collateral$307.9 $271.9 $137.6 $101.7 
The fair values of derivative assets and liabilities associated with contracts, thatwhich include netting languageterms that the Company believes to be enforceable, have been netted to presentrecorded net within the Company's net exposure with these counterparties.Consolidated Balance Sheets. The Company recognizesreceives cash from customers as collateral for trade exposures, which is recorded within cash and cash equivalents and customer deposits 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 certain 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. The table below presents the fair value of the Company’s derivative assets in prepaid expense and other current assets and all derivative liabilities, in other current liabilities, both net atas well as their classification on the customer level as right of offset exists, in itsaccompanying Consolidated Balance Sheets, atas of June 30, 2021 and December 31, 2020 (in millions). 
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June 30, 2021December 31, 2020
 Balance Sheet ClassificationFair Value
   
Derivative AssetOther current assets$133.4 $139.3 
Derivative AssetOther noncurrent assets$32.4 $16.6 
Derivative LiabilityOther current liabilities$84.2 $127.7 
Derivative LiabilityOther noncurrent liabilities$31.2 $12.5 
Cash Flow Hedges
On January 22, 2019, the Company entered into 3 interest rate swap cash flow contracts (the "swap contracts"). The objective of these swap contracts is 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. As of June 30, 2021, the Company had the following outstanding interest rate derivatives that qualify as hedging instruments and are designated as cash flow hedges of interest rate risk (in millions):
 Notional AmountFixed RatesMaturity Date
Interest Rate Derivative: 
Interest Rate Swap $1,000 2.56%1/31/2022
Interest Rate Swap 500 2.56%1/31/2023
Interest Rate Swap 500 2.55%12/19/2023

For each of these swap contracts, the Company pays a fixed monthly rate and receives one month LIBOR.

The table below presents the fair value of the Company’s interest rate swap contracts, as well as their fair value. The gain or lossclassification on the accompanying Consolidated Balance Sheets, as of June 30, 2021 and December 31, 2020 (in millions). See Note 3 for additional information on the fair value is recognized immediately within other (income) expense, netof the Company’s swap contracts.
June 30, 2021December 31, 2020
 Balance Sheet ClassificationFair Value
Derivatives designated as cash flow hedges:  
Swap contractsOther current liabilities$39.0 $49.3 
Swap contractsOther noncurrent liabilities$22.0 $38.6 

The table below displays the effect of the Company’s derivative financial instruments in the Unaudited Consolidated Statements of Income. At SeptemberIncome and Other Comprehensive Income (Loss) for the six months ended June 30, 2017, $150.72021 and 2020 (in millions):

Six Months Ended
June 30,
20212020
Interest Rate Swaps:
Amount of gain (loss) recognized in other comprehensive income (loss) on derivatives, net of tax of $(6.6) million and $28.2 million for 2021 and 2020, respectively $20.3 $(42.6)
Amount of loss reclassified from accumulated other comprehensive loss into interest expense                 24.5 14.7 

The estimated net amount of the existing losses expected to be reclassified into earnings within the next 12 months is approximately $39.1 million derivative assets and $70.9 million derivative liabilities were recordedat June 30, 2021.


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14. Accumulated Other Comprehensive Loss (AOCL)
The changes in the Consolidated Balance Sheet.components of AOCL for the six months ended June 30, 2021 and 2020 are as follows (in thousands):

June 30, 2021
Cumulative Foreign Currency TranslationUnrealized (Losses) Gains on Derivative InstrumentsTotal Accumulated Other Comprehensive (Loss) Income
Balance at January 1, 2021$(1,296,962)$(66,196)$(1,363,158)
Other comprehensive income before reclassifications77,648 2,345 79,993 
Amounts reclassified from AOCI0 24,542 24,542 
Tax effect0 (6,554)(6,554)
Other comprehensive income77,648 20,333 97,981 
Balance at June 30, 2021$(1,219,314)$(45,863)$(1,265,177)

June 30, 2020
Cumulative Foreign Currency TranslationUnrealized (Losses) Gains on Derivative InstrumentsTotal Accumulated Other Comprehensive (Loss) Income
Balance at January 1, 2020$(929,713)$(42,752)$(972,465)
Other comprehensive loss before reclassifications(566,861)(85,554)(652,415)
Amounts reclassified from AOCI0 14,729 14,729 
Tax effect0 28,176 28,176 
Other comprehensive loss(566,861)(42,649)(609,510)
Balance at June 30, 2020$(1,496,574)$(85,401)$(1,581,975)

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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, 2020. All foreign currency amounts that have been converted into U.S. dollars in this discussion are based on the exchange rate as reported by OANDAOanda for the applicable periods.
This management’s
The following discussion and analysis should alsoof our financial condition and results of operations generally discusses the second quarter and the first half of 2021 and 2020, with period-over-period comparisons between these periods. A detailed discussion of 2020 items and period-over-period comparisons between the second quarter and first half of 2020 and 2019 that are not included in this Quarterly Report on Form 10-Q can be readfound in conjunction"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 June 30, 2020.

Executive Overview
FLEETCOR is a leading global provider of digital payment solutions that enables businesses to control purchases and make payments more effectively and efficiently. Since its incorporation in 2000, FLEETCOR has continued to deliver on its mission: to provide businesses with “a better way to pay”. FLEETCOR has been a member of the management’s discussionS&P 500 since 2018 and analysis and consolidated financial statements and related notes includedtrades on the New York Stock Exchange under the ticker FLT.
As previously described in our Annual Report on Form 10-K for the year ended December 31, 2016.2020, businesses spend an estimated $170 trillion each year. In many instances, they 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 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.
General Business
FleetcorFLEETCOR’s vision is a leading global provider of commercialthat every payment solutions. We primarily gois 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 which can be utilized to marketeffectively reduce unauthorized purchases and fraud, automate data entry and reporting, and eliminate reimbursement processes. Combining this payment data 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.,analytical tools delivers powerful insights, 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 customersmanagers can use to better manage and controlrun 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 aOur wide range of customized fleetmodern, digitized solutions generally provides control, reporting, and lodgingautomation benefits superior to many of the payment programs directly and indirectly to our customers through partners,methods businesses often used, 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,cash, paper checks, general purpose credit cards, as well as specialized information services that provide our customers with value-added functionalityemployee pay 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.reclaim processes.
Executive Overview
We operate in two segments, which we refer to as our North America and International segments. Our revenue is generally reported net of the wholesale cost for underlying products and services.services purchased through our payment solutions. In this report, we refer to this net revenue as “revenue.”“revenue". See “Results of Operations” for additional segment information. We report

Impact of COVID-19 on Our Business
On March 11, 2020, the World Health Organization declared the novel strain of coronavirus (including variants thereof, "COVID-19") a global pandemic and recommended containment and mitigation measures worldwide. The pandemic and these containment and mitigation measures have created adverse impacts on the U.S. and global economies and it is unclear whether or how long the pandemic and related economic impacts will continue, whether as a result of new strains of the virus, as a result of vaccine efficacy of distribution rates, or otherwise. The COVID-19 pandemic has had, and could continue to have, an adverse impact on our results from Cambridge acquiredof operations and liquidity; the operations of our suppliers, vendors and customers; and on our employees as a result of quarantines, facility closures, travel and logistics restrictions and general decreases in the third quarterlevel of 2017 in our North America segment for Cambridge'sconsumer confidence and business in the United States and Canada and within our International segment for Cambridge's business in all other countries outsideactivity.
The COVID-19 pandemic continues to impact various aspects of the United Statesworld economy and Canada. We are continuingour customers. The extent to evaluatewhich the

allocation COVID-19 pandemic impacts our business operations, financial results, and liquidity through the remainder of Cambridge results2021 will depend on numerous evolving factors that we may not be able to accurately predict or assess, including the duration and scope of the pandemic and the geographies most affected; vaccine availability globally, distribution, efficacy to new strains of the virus and the public's willingness to get vaccinated; our reporting unitsresponse to the continued impact of the pandemic; the negative impact it has on global and segments. As partregional economies and general economic activity, including the duration and magnitude of its impact on unemployment rates and business spending levels; its short- and longer-term impact on the levels of consumer confidence; the ability of our plansuppliers, vendors and customers to exitsuccessfully address the telematics business,continued impacts of the pandemic; and actions governments, businesses and individuals take in response to the pandemic; and how quickly economies recover after the pandemic subsides. While we believe the COVID-19 pandemic will continue to have an adverse effect on July 27, 2017,our revenues and earnings in 2021, we sold NexTraq, a U.S. fleet telematics business, which has historically been included in our North America segment.expect continued improvement throughout the year as economic activity recovers.
Performance
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 ninesix months ended SeptemberJune 30, 20172021 and 20162020 (in thousands,millions, except per share amounts).
24
Table of Contents

  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
Three Months Ended June 30,Six Months Ended June 30,
(Unaudited)2021202020212020
Revenues, net$667.4 $525.1 $1,276.0 $1,186.2 
Net income$196.2 $158.5 $380.5 $305.5 
Net income per diluted share$2.30 $1.83 $4.45 $3.50 


Adjusted Revenues, Adjusted Net Income and Adjusted Net Income Per Diluted Share. Set forth below are adjusted revenues, adjusted net income and adjusted net income per diluted share for the three and ninesix months ended SeptemberJune 30, 20172021 and 20162020 (in thousands,millions, except per share amounts).

Three Months Ended June 30,Six Months Ended June 30,
(Unaudited)2021202020212020
Adjusted net income$268.4 $197.4 $510.6 $461.9 
Adjusted net income per diluted share$3.15 $2.28 $5.97 $5.29 
  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 useAdjusted net income and adjusted revenues asnet income per diluted share 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, netreconciliation of the commissions that are paidnon-GAAP financial measure to merchants that participatethe 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 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 and adjusted net income per diluted share are supplemental non-GAAP financial measures of operating performance. See the heading entitled “Management’s Use of Non-GAAP Financial Measures.”
Sources of Revenue
Transactions. In bothFLEETCOR 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 payment solutions to our business, merchant, consumer and payment network customers in more than 100 countries around the world today, although we operate primarily in 3 geographies, with 87% of our segments, we derive revenue from transactions. As illustratedbusiness 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 productscommercial businesses (obtained through direct and those of ourindirect channels), partners for whom we manage cardpayment programs, members of our proprietary networks who are provided access to our products and services and commercial businesses to whom we provide workforce payment productivity solutions. Revenue from transactions is derived from our merchant and network relationships, as well as individual consumers.
FLEETCOR has three reportable segments, North America, International, and Brazil. We report these three segments as they reflect how we organize and manage our customersglobal employee base, manage operating performance, contemplate the differing regulatory environments across geographies, and partners. Throughhelp us isolate the impact of foreign exchange fluctuations on our merchantfinancial results. However, to help facilitate an understanding of our expansive range of solutions around the world, we describe them in two categories: Corporate Payments solutions, which simplify and network relationships we primarily offer fuel cards,automate payments, and Expense Management solutions, which help control and monitor employee spending.
Our Corporate Payments solutions are designed to help businesses streamline the back-office operations associated with making outgoing payments. Companies save time, cut costs, and manage B2B payment processing more efficiently with our suite of corporate cards,payment solutions, including accounts payable (AP) automation, virtual cards, cross-border, and purchasing cards,and T&E cards, gift cards, stored value payroll cards, vehicle maintenance, food, fuel, tollcards. Our Expense Management solutions (Fuel, Tolls, and transportation cardsLodging) are purpose-built to provide customers with greater control and vouchersvisibility of employee spending when compared with less specialized payment methods, such as cash or general-purpose credit cards. FLEETCOR provides several other payments solutions that, due to their nature or size, are not considered within our Corporate Payments and lodging services to our customers.Expense Management solutions.
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 our businesses.

Illustrative Transaction Flowtranflowexamplea03.jpg
From our customers and partners, we derive revenue from a variety of program fees, including transaction fees, card fees, network fees and charges, which can be fixed fees, cost plus a mark-up or based on a percentage discount from retail prices. Our programs include other fees and charges associated with late payments and based on customer credit risk.
From our merchant and network relationships, we derive revenue mostly from the difference between the price charged to a customer for a transaction and the price paid to the merchant or network for the same transaction, as well as network fees and charges in certain businesses. As illustrated in the table below, the price paid to a merchant or network may be calculated as (i) 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.
The following table presents an illustrative revenue model for transactions with the merchant, which is primarily applicable to fuel based product transactions, but may also be applied to our vehicle maintenance, lodging and food, fuel, toll and transportation card and voucher products, substituting transactions for gallons. This representative model may not include all of our businesses.
Illustrative 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, net, by geography, product and source. Set forth below are further breakdowns of revenue by geography, product and source forSegment. For the three and ninesix months ended SeptemberJune 30, 20172021 and 20162020, our segments generated the following revenue (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 June 30,Six Months Ended June 30,
2021202020212020
(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$443.4 66.4 %$357.4 68.1 %$845.6 66.3 %$792.1 66.8 %
Brazil85.7 12.8 %75.1 14.3 %167.6 13.1 %174.1 14.7 %
International138.3 20.7 %$92.6 17.6 %262.8 20.6 %220.0 18.5 %
$667.4 100 %$525.1 100 %$1,276.0 100.0 %$1,186.2 100.0 %
*Columns may not calculate due to impact of rounding.

25
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%
Revenues, net by Geography and Solution. Revenue by geography and solution category for the three and six months ended June 30, 2021 and 2020 (in millions), was as follows:
 Three Months Ended June 30,Six Months Ended June 30,
Revenues, net by Geography*2021202020212020
(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$412.7 62 %$334.9 64 %$783.3 61 %$732.8 62 %
Brazil$85.7 13 %$75.1 14 %$167.6 13 %$174.1 15 %
United Kingdom$83.6 13 %$49.0 9 %$159.2 12 %$122.6 10 %
Other$85.4 13 %$66.1 13 %$166.0 13 %$156.7 13 %
Consolidated revenues, net$667.4 100 %$525.1 100 %$1,276.0 100 %$1,186.2 100 %
*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%
Three Months Ended June 30,Six Months Ended June 30,
Revenues, net by Solution Category*2021202020212020
(Unaudited)Revenues, net% of Total Revenues, netRevenues, net% of Total
Revenues, net		Revenues, net% of Total Revenues, netRevenues, net% of Total
Revenues, net
Fuel$295.1 44 %$249.8 48 %$557.0 44 %$541.9 46 %
Corporate Payments140.4 21 %92.6 18 %256.8 20 %212.5 18 %
Tolls71.3 11 %64.8 12 %140.3 11 %147.8 12 %
Lodging62.2 9 %40.6 8 %121.3 10 %97.6 8 %
Gift32.3 5 %26.5 5 %75.7 6 %68.9 6 %
Other66.0 10 %50.8 10 %124.9 10 %117.5 10 %
Consolidated revenues, net667.4 100 %525.1 100 %$1,276.0 100 %$1,186.2 100 %
1Includes revenue from customers based on accounts, cards, devices, transactions, load amounts and/or purchase amounts, etc. for participation in our various fleet 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.
2Fees 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.
4Interchange revenue directly influenced by the absolute price of fuel and other interchange related to fuel products.
5Interchange revenue related to nonfuel products.
6Revenue 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.
7Revenue 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 for the three months ended September 30, 2017 and 2016 (in millions except revenues, net per transaction)*:
  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.


26
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The following table presents revenue per key performance metric by solution for the three months ended June 30, 2021 and 2020 (in millions except revenues, net per key performance metric).*
As Reported
Pro Forma and Macro Adjusted2
Three Months Ended June 30,Three Months Ended June 30,
(Unaudited)20212020Change% Change20212020Change% Change
FUEL
'- Revenues, net
$295.1 $249.8 $45.3 18 %$298.1 $250.1 $48.0 19 %
'- Transactions
118.3 99.7 18.6 19 %118.3 99.8 18.4 18 %
'- Revenues, net per transaction
$2.50 $2.51 $(0.01)— %$2.52 $2.51 $0.02 1 %
CORPORATE PAYMENTS
'- Revenues, net
$140.4 $92.6 $47.8 52 %$135.8 $102.7 $33.1 32 %
'- Spend volume
$22,862 $13,672 $9,190 67 %$22,859 $17,583 $5,276 30 %
'- Revenue, net per spend $
0.61 %0.68 %(0.06)%(9)%0.59 %0.58 %0.01 %2 %
TOLLS
'- Revenues, net
$71.3 $64.8 $6.5 10 %$70.5 $64.8 $5.6 9 %
'- Tags (average monthly)
5.8 5.3 0.5 10 %5.8 5.3 0.5 10 %
'- Revenues, net per tag
$12.21 $12.19 $0.02 — %$12.06 $12.19 $(0.13)(1)%
LODGING
'- Revenues, net
$62.2 $40.6 $21.6 53 %$62.2 $44.8 $17.4 39 %
'- Room nights
6.6 4.6 2.0 44 %6.6 5.0 1.6 32 %
'- Revenues, net per room night
$9.41 $8.82 $0.58 7 %$9.40 $8.96 $0.44 5 %
GIFT
'- Revenues, net
$32.3 $26.5 $5.8 22 %$32.3 $26.5 $5.8 22 %
'- Transactions
259.4 188.2 71.1 38 %259.4 188.2 71.1 38 %
'- Revenues, net per transaction
$0.12 $0.14 $(0.02)(12)%$0.12 $0.14 $(0.02)(12)%
OTHER1
'- Revenues, net
$66.0 $50.8 $15.2 30 %$63.5 $50.8 $12.7 25 %
'- Transactions
9.3 9.0 0.3 3 %9.3 9.0 0.3 3 %
'- Revenues, net per transaction
$7.13 $5.65 $1.48 26 %$6.86 $5.65 $1.21 21 %
FLEETCOR CONSOLIDATED REVENUES, NET
'- Revenues, net
$667.4 $525.1 $142.2 27 %$662.3 $539.8 $122.5 23 %
1Other includes telematics, maintenance, food, transportation and transportationpayroll card related businesses.
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.
32017 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.
42016 is pro forma to include acquisitions and exclude dispositions consistent with 2017 ownership.
52016 and YTD 2017 transactions reflect immaterial corrections from previously disclosed amounts for the prior period.
rounding.

Revenue per relevant key performance indicator ("KPI"), which may include transaction, spend volume, monthly tags, room nights, or other metrics, is derived from the various revenue types as discussed above and can vary based on geography, the relevant merchant relationship, the payment productsolution 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 transactionKPI per customer changesmay 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 of Operations” for further discussion of transaction volumes and revenue per transaction.

27

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 consistsexpenses consist of expenses related to processing transactions, servicing our customers and merchants, bad debt expensecredit losses and cost of goods sold related to our hardware sales in certain businesses.
•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) 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 unusualthat do not relate to the period and presented separately.
our core operations or that occur infrequently.
•Investment (gain) loss, (income)net—Our investment results primarily relate to impairment charges related to our minorityinvestments and unrealized gains and losses related to a noncontrolling interest in Masternaut, a provider of telematics solutions to commercial fleetsmarketable security, which was disposed in Europe, which we historically accounted for using the equity method. 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.
2020.
•Other expense (income), net—Our other expense (income), net includes foreign currency transaction gains or losses proceeds/costs from the sale of assets, foreign currency transactions, and other miscellaneous operating costs and revenue.
•Interest expense, net—Our interest expense, net includes interest expense on our outstanding debt, interest income on our cash balances and interest expense on our outstanding debt and on our Securitization Facility. We have historically invested our cash primarily in short-term money market funds.
interest rate 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 to profitsearnings 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 internationally, including the ultimate impact of the COVID-19 pandemic. 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, relative to the U.S. dollar. Approximately 61% and 62% of our revenue in the six months ended June 30, 2021 and 2020, 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 impacts 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. See “SourcesWe believe approximately 13% and 11% of Revenue” above for further information related torevenues, net were directly impacted by changes in fuel price in the absolutethree months ended June 30, 2021 and 2020, respectively.
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We believe approximately 12% and 11% of revenues, net were directly impacted by changes in fuel price of fuel.
in the six months ended June 30, 2021 and 2020, respectively.
•Fuel-price spread volatility—A portion of our revenue involves transactions where we derive revenue from fuel-pricefuel 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-pricefuel 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. See “SourcesThe inverse of Revenue” above for further information related to fuel-price spreads.
these situations produces fuel price spread expansion. We believe approximately 6% and 11% of revenues, net were directly impacted by fuel price spreads in the three months ended June 30, 2021 and 2020, respectively. We believe approximately 5% and 9% of revenues, net were directly impacted by fuel price spreads in the six months ended June 30, 2021 and 2020, respectively.

•Acquisitions—Since 2002, we have completed over 7585 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 of operations are affected by interest rates. We are exposed to market risk to changes in interest rates on our cash investments and debt.
Global economic conditions—Our results On January 22, 2019, we entered into three swap contracts. The objective of operations are materially affected by conditionsthese swap contracts is to reduce the variability of cash flows in the economy generally, both in North America and internationally. Factors affected bypreviously unhedged interest payments associated with $2.0 billion of variable rate debt, the economy include our transaction volumes and the credit risksole source of our customers. These factors affected our businesses in both our North America and International segments.
Foreign currency changes—Our results of operations are significantly impacted bywhich is due to changes in foreign currency rates; namely, by movementsthe LIBOR benchmark interest rate. For each of the Australian dollar, Brazilian real, British pound, Canadian dollar, Czech koruna, Euro, Mexican peso, New Zealand dollarthese 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 LIBOR.
•Expenses—Over the long term, we expect that our general and administrative expense will decrease as a percentage of revenue as our revenue increases. 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

2021
•On August 9, 2017,July 28, 2021, we acquired Cambridge Global Payments (“Cambridge”)signed a definitive agreement to acquire ALE Solutions, Inc. (ALE), a leading businessU.S. based leader in lodging solutions to business (B2B) international paymentsthe insurance industry, for approximately $400 million. The transaction is expected to close during the third quarter of 2021, subject to regulatory approval and closing conditions.
•On June 1, 2021, we completed the acquisition of AFEX, a U.S. based, cross-border payment solutions provider for approximately $584.1 million in cash, net$419 million.
•On January 13, 2021, we completed the acquisition of cash acquired of $132.3 million and inclusive ofRoger, which has been rebranded as CorpayOne, a noteglobal accounts payable of $23.9(AP) cloud software platform for small businesses, for approximately $39 million. Cambridge processes B2B cross-border payments, assisting business clients in making international payments to suppliers and employees. The purpose of thisThis acquisition is not expected to further expand our corporate payments footprint.be material to the financial results of the Company.

2020
•On September 26, 2017,November 30, 2020, we acquiredcompleted the acquisition of a fuel card provider in Russia. New Zealand for an immaterial amount.
•On October 13, 2017,August 10, 2020, we completed the acquisition of Creative Lodging Solutions ("CLS"), a small 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 the period related to prior year acquisitions of $6.1 million.

In August 2016, we acquired all of the outstanding stock of 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 our presencebusiness 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 portfolioslodging space in the U.S. for an immaterial amount.
Results from our 2021 and the United Kingdom, additional Shell fuel card markets2020 AFEX, Roger and lodging acquisitions are reported in Europe and Travelcard in the Netherlands totaling $76.7 million, net of cash acquired of $11.1 million.
During 2016, we made additional investments of $7.9 million related to our investment in Masternaut. We also received a $9.2 million return of our investment in Masternaut.

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. 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 datedates of acquisition. The results of operations of STP, the fuel card portfolioResults from our 2020 New Zealand acquisition are reported in the United Kingdom, the additional Shell markets, the Travelcard business in the Netherlands and the small business in Brazil are included within our International segment from the date of acquisition.


Asset Dispositions
29


Telematics Businesses
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 $175.0 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 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 SeptemberJune 30, 20172021 compared to the three months ended SeptemberJune 30, 20162020
The following table sets forth selected unaudited consolidated statementstatements of income and selected operational data for the three months ended SeptemberJune 30, 20172021 and 20162020 (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 June 30, 2021% of Total
Revenues, net		Three Months Ended June 30, 2020% of Total
Revenues, net		Increase
(decrease)		% Change
Revenues, net:
North America$443.4 66.4 %$357.4 68.1 %$86.0 24.1 %
Brazil85.7 12.8 %75.1 14.3 %10.5 14.0 %
International138.3 20.7 %92.6 17.6 %45.7 49.4 %
Total revenues, net667.4 100.0 %525.1 100.0 %142.2 27.1 %
Consolidated operating expenses:
Processing122.3 18.3 %121.3 23.1 %1.0 0.8 %
Selling63.2 9.5 %42.4 8.1 %20.9 49.2 %
General and administrative115.0 17.2 %86.7 16.5 %28.3 32.6 %
Depreciation and amortization69.2 10.4 %62.2 11.8 %7.1 11.4 %
Other operating, net— — %(0.2)— %(0.3)NM
Operating income297.6 44.6 %212.8 40.5 %84.8 39.8 %
Investment gain— — %(33.7)(6.4)%33.7 NM
Other expense, net0.4 0.1 %2.5 0.5 %(2.1)(83.5)%
Interest expense, net34.7 5.2 %32.4 6.2 %2.3 7.0 %
Provision for income taxes66.3 9.9 %53.1 10.1 %13.1 24.7 %
Net income$196.2 29.4 %$158.5 30.2 %$37.8 23.8 %
Operating income for segments:
North America$178.7 $133.2 $45.5 34.2 %
Brazil33.3 29.4 3.9 13.3 %
International85.6 50.2 35.4 70.4 %
Operating income$297.6 $212.8 $84.8 39.8 %
Operating margin for segments:
North America40.3 %37.3 %3.0 %
Brazil38.9 %39.1 %(0.2)%
International61.9 %54.3 %7.6 %
Consolidated44.6 %40.5 %4.1 %
NM = Not Meaningful
*The sum of the columns and rows may not calculate due to rounding.


Revenues, net
Our consolidatedConsolidated revenues increased from $484.4were $667.4 million in the three months ended SeptemberJune 30, 2016 to $577.92021, an increase of $142.2 million or 27.1%, from $525.1 million in the three months ended SeptemberJune 30, 2017, an increase2020. Organically, consolidated revenues increased by approximately 23%. Consolidated revenues and organic growth increased primarily due to increases in transaction volume as the business recovered from the effects of $93.5 million, or 19.3%.the COVID-19 pandemic. The increase in our consolidated revenue was primarilyalso due to:

Theto the impact of acquisitions during 2016completed in 2020 and 2017, which contributed approximately $58 million in additional revenue.
Organic growth2021 of approximately 8% on a constant fuel price, fuel spread margin, foreign currency$15 million and pro forma basis, driven by increases in both volume and revenue per transaction in certainthe positive impact of our payment programs.

the macroeconomic environment.
Although we cannot precisely measure the impact of the macroeconomic environment, in total we believe it had a favorablepositive impact on our consolidated revenuerevenues for the three months ended SeptemberJune 30, 20172021 over the comparable period in 20162020 of approximately $4 million. This was$5 million, driven primarily due toby favorable changes in foreign exchange rates of approximately $19 million mostly in our U.K., Canada and Brazil businesses and the United Kingdom in the three months ended September 30, 2017 compared to 2016.

favorable impact of fuel prices of approximately $16 million. These increases were partially offset by the impact of the disposition of the NexTraq business in July 2017unfavorable fuel price spreads of approximately $10$30 million.


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North America segment revenues, net
North America segment revenues increased from $345.9were $443.4 million in the three months ended SeptemberJune 30, 2016 to $364.42021, an increase of $86.0 million or 24.1%, from $357.4 million in the three months ended SeptemberJune 30, 2017, an increase2020. Organically, North America segment revenues increased by approximately 22%. North America revenues and organic growth increased primarily due to increases in transaction volume as the business recovered from the effects of $18.6 million, or 5.4%.the COVID-19 pandemic. The increase in our North America segment revenuerevenues was primarilyalso due to:

Theto the impact of our Cambridge acquisition during the third quarter of 2017, which contributed approximately $12 millionacquisitions completed in additional revenue.
Organic growth2020 and 2021 of approximately 5%, on a constant fuel price, fuel spread margin and pro forma basis, driven$14 million, partially offset by increases in both volume and revenue per transaction in certainthe negative impact of our payment programs.the macroeconomic environment.
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 revenuerevenues in the three months ended SeptemberJune 30, 20172021 over the comparable period in 20162020 of approximately $2$11 million, driven primarily due to the impactby unfavorable fuel price spreads of lower fuel spread margins.

These increases wereapproximately $30 million. This decrease was partially offset by favorable changes in foreign exchange rates of approximately $5 million in our cross-border business and the favorable impact of the disposition of the NexTraq business in July 2017fuel prices of approximately $10$14 million.


InternationalBrazil segment revenues, net
InternationalBrazil segment revenues increased from $138.6were $85.7 million in the three months ended SeptemberJune 30, 20162021, an increase of $10.5 million or 14.0%, from $75.1 million in three months ended June 30, 2020. Organically, Brazil segment revenues increased by approximately 13%. Brazil revenues and organic growth increased primarily due to $213.4increases in toll tags sold as the business recovered from the effects of the COVID-19 pandemic. The increase in Brazil revenues was also due to the slightly favorable impact of foreign exchange rates of approximately $1 million for the three months ended June 30, 2021 over the comparable period in 2020.

International segment revenues, net
International segment revenues were $138.3 million in the three months ended SeptemberJune 30, 2017,2021, an increase of $74.9$45.7 million or 54.0%. The increase49.4%, from $92.6 million in ourthe three months ended June 30, 2020. Organically, International segment revenue wasrevenues increased by approximately 33%. International revenues and organic growth increased 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 byto increases in bothtransaction volume and revenue per transaction in certainas the business recovered from the effects of our payment programs.
the COVID-19 pandemic. 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 forrevenues in the three months ended SeptemberJune 30, 20172021 over the comparable period in 20162020 of approximately $6 million. Changes in$15 million, driven primarily by favorable foreign exchange rates and fuel price had favorable impacts on consolidated revenues of approximately $4$13 million primarily in our U.K. business and the favorable impact of fuel prices of approximately $2 million, respectively.million.
Consolidated operating expenses
Merchant commissions. Merchant commissions decreased from $28.2Processing. Processing expenses were $122.3 million in the three months ended SeptemberJune 30, 20162021, an increase of $1.0 million or 0.8%, from $121.3 million in the comparable prior period. Increases were primarily due to $27.7expenses related to higher volumes processed of approximately $14 million, expenses related to acquisitions completed in 2020 and 2021 of approximately $6 million, and the unfavorable impact of changes in foreign exchange rates of approximately $2 million. These increases were partially offset by a decrease in bad debt expense of $15 million.
Selling. Selling expenses were $63.2 million in the three months ended SeptemberJune 30, 2017, a decrease2021, an increase of $0.5$20.9 million or 1.9%. This decrease was49.2%, from $42.4 million in the comparable prior period. Increases in selling expenses were primarily due to higher commissions and other variable costs due to increased sales volumes in the fluctuationsecond quarter of 2021, expenses related to acquisitions completed in 2020 and 2021 of approximately $7 million and the margin between the wholesale costunfavorable impact of fluctuations in foreign exchange rates of approximately $2 million.
General and retail price of fuel.
Processing. Processingadministrative. General and administrative expenses increased from $96.2were $115.0 million in the three months ended SeptemberJune 30, 20162021, an increase of $28.3 million or 32.6% from $86.7 million in the comparable prior period. Increases in general and administrative expenses were primarily due to $111.3increased stock based compensation expense of $8 million, the impact of acquisitions completed in 2020 and 2021 of approximately $7 million, increased professional fees of $3 million and the unfavorable impact of fluctuations in foreign exchange rates of approximately $2 million.

Depreciation and amortization. Depreciation and amortization expenses were $69.2 million in the three months ended SeptemberJune 30, 2017,2021, an increase of $15.1$7.1 million or 15.6%.11.4%, from $62.2 million in the comparable prior period. Increases in processingdepreciation and amortization expenses were primarily due to expenses related to acquisitions completed in 20162020 and 20172021 of approximately $14$5 million and the unfavorable impact of fluctuations in foreign exchange rates and incremental spend due to increases in volume. These increases were partially offset by the impact of disposition of the NexTraq business of approximately $3 million and lower bad debt expense of approximately $2 million.
Selling. Selling expenses increased from $34.2
Investment gain. Investment gain of $33.7 million in the three months ended SeptemberJune 30, 20162020 relates to $45.1market value gains on our investment in bill.com during the second quarter of 2020, which we sold during the third quarter of 2020.

31

Interest expense, net. Interest expense, net was $34.7 million in the three months ended SeptemberJune 30, 2017,2021, an increase of $10.9$2.3 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 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.
General and administrative. General and administrative expenses increased7.0%, from $77.9$32.4 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%.comparable prior period. The increase in interest expense iswas primarily due to higher balances on our new term B loan and the impact of additional borrowings to finance the acquisitions of STPon our Securitization Facility, partially offset by lower borrowings on our revolver and Travelcard completed during the third quarter of 2016 and Cambridge completed during the third quarter of 2017, and increases in LIBOR.lower LIBOR 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 June 30,
(Unaudited) 2017 2016(Unaudited)20212020
Term loan A 2.98% 1.99%Term loan A1.60 %2.01 %
Term loan B 3.32% 3.75%Term loan B1.85 %2.26 %
Domestic Revolver A 2.99% 2.08%
Foreign Revolver A 2.00% 1.77%
Revolving line of credit A, B & C USD BorrowingsRevolving line of credit A, B & C USD Borrowings1.61 %2.06 %
Revolving line of credit B GBP BorrowingsRevolving line of credit B GBP Borrowings— %1.69 %
Foreign swing line 1.97% 1.73%Foreign swing line1.54 %1.56 %
The average unused credit facility fee for Domestic Revolver Athe Credit Facility was 0.35% and 0.30% in the three month period ending Septemberended June 30, 2017 and 2016, respectively.2021.
Loss on extinguishmentOn January 22, 2019, we entered into three interest rate swap cash flow contracts. The objective of debt. Loss on early extinguishmentthese interest rate swap contracts is to reduce the variability of debt of $3.3 million relates to our write-off of debt issuance costscash flows in the previously unhedged interest payments associated with $2 billion of variable rate debt, tied to the refinancingone month LIBOR benchmark interest rate. During the three months ended June 30, 2021, as a result of our existing credit facility duringthese swap contracts, we incurred additional interest expense of $12.4 million or 2.45% over the third quarteraverage LIBOR rates on $2 billion of 2017.borrowings.
Provision for income taxes. The provision for income taxes increased from $40.6and effective tax rate were $66.3 million and 25.2% in the three months ended SeptemberJune 30, 2016 to $124.72021, an increase of $13.1 million, or 24.7% change, from $53.1 million and 25.1% in the three months ended SeptemberJune 30, 2017, an increase of $84.1 million, or 207.2%.2020. We provide for income taxes during interim periods based on an estimate of our effective tax rate for the year. Discrete items 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% for
During the three months ended SeptemberJune 30, 2017. The 20172021, we recorded tax expense of $6.5 million as a result of the remeasurement in deferreds due to the increase in the U.K. corporate tax rate was impacted by the gain on sale of the NexTraq business of $175 million, all at the higher U.S. tax rate, and the Masternaut impairment chargefrom 19% to 25%, effective in 2023. The provision for income taxes in the quarter, which had no correspondingthree months ended June 30, 2020 included a $9.8 million increase in a reserve for uncertain tax benefit. Ourpositions related to prior years. Excluding these discrete items in each period, our effective tax rate in the second quarter was 29.4%, excludingof 2021 would have been 22.8% compared to 20.5% in 2020. The increase in the impact of the NexTraq sale, investment impairment and loss 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 subjectprimarily due to income tax. The 2016 rate was also favorably impacted by higherless excess tax benefitsbenefit on share-based compensationstock option exercises in 2021 over the comparable period in 2020. The increase in the third quarter of 2016 versus the third quarter of 2017.provision for income taxes was driven primarily by an increase in pre-tax earnings.
We pay taxes in many different taxing jurisdictions, including the U.S.,US, most U.S.US states, and many non-U.S.non-US jurisdictions. The tax rates in certain non-U.S.non-US taxing jurisdictions are lowerdifferent than the U.S.US 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 from $129.6to $196.2 million in the three months ended SeptemberJune 30, 2016 to $202.82021, an increase of $37.8 million or 23.8%, from $158.5 million in the three months ended SeptemberJune 30, 2017, an increase of $73.2 million, or 56.5%.2020.
Operating income and operating margin
Consolidated operating income. Operating income increased from $191.1was $297.6 million in the three months ended SeptemberJune 30, 2016 to $232.62021, an increase of $84.8 million or 39.8%, from $212.8 million in the three months ended September 30, 2017, an increase of $41.6 million, or 21.8%.comparable prior period. Our operating margin was 39.4%44.6% and 40.3%40.5% for the three months ended SeptemberJune 30, 20162021 and 2017,2020, respectively. The increase in operating income was primarily due to acquisitions completed in 2016 and 2017 and organic growth, as well as the positive impact of the macroeconomic environment of approximately $4 million,These increases were driven primarily by the increases in transaction volume as the business recovered from the effects of the COVID-19 pandemic driving organic growth, favorable movements in the foreign exchange rates of $10 million and favorable impact of fuel prices and fluctuations in foreign exchange rates.of $16 million. These increases were 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 compensationunfavorable fuel price spreads of approximately $7 million and the disposition of the NexTraq business in July 2017 of approximately $4$30 million.
For the purpose of segment operating results, we calculate segment operating income by subtracting segment operating expenses from segment revenue.revenues, net. Segment operating margin is calculated by dividing segment operating income by segment revenue.revenues, net.


North America segment operating income. North America operating income increased from $135.8was $178.7 million in the three months ended SeptemberJune 30, 2016 to $138.72021, an increase of $45.5 million or 34.2%, from $133.2 million in the comparable prior period. North America operating margin was 40.3% and 37.3% for the three months ended June 30, 2021 and 2020, respectively. These increases were primarily driven by increases in transaction volume as the business recovered from the effects of the COVID-19 pandemic driving organic growth, the favorable impact of fuel prices of $14 million and favorable movements in the foreign exchange rates of $2 million. These increases were partially offset by unfavorable fuel price spreads of approximately $30 million.
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Brazil segment operating income. Brazil operating income was $33.3 million in the three months ended SeptemberJune 30, 2017,2021, an increase of $3.0$3.9 million or 2.2%. North America13.3%, from $29.4 million in the comparable prior period. Brazil operating margin was 39.3%38.9% and 38.1%39.1% for the three months ended SeptemberJune 30, 20162021 and 2017,2020, respectively. The increase in operating income was due primarily to organic growth anddriven by increases in transaction volume as the positive impactbusiness recovered from the effects of the macroeconomic environment of approximately $1 million, driven by favorable fuel prices. These increases 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.COVID-19 pandemic driving organic growth.

International segment operating income. International operating income increased from $55.3was $85.6 million in the three months ended SeptemberJune 30, 2016 to $93.92021, an increase of $35.4 million or 70.4%, from $50.2 million in the three months ended September 30, 2017, an increase of $38.6 million, or 69.8%.comparable prior period. International operating margin was 39.9%61.9% and 44.0%54.3% for the three months ended SeptemberJune 30, 20162021 and 2017,2020, respectively. The increase in 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 million,These increases were driven primarily by increases in transaction volume as the business recovered from the effects of the COVID-19 pandemic driving organic growth, favorable fluctuationsmovements in the foreign exchange rates. The higher operating margin was driven by the positiverates of $8 million and favorable impact of process improvements in our recently acquired STP business, offset by higher amortization and depreciation expense related to acquisitionsfuel prices of STP and Travelcard completed in the third quarter of 2016 and additional stock based compensation expense of approximately $1$2 million.


NineSix months ended SeptemberJune 30, 20172021 compared to the ninesix months ended SeptemberJune 30, 20162020
The following table sets forth selected unaudited consolidated statementstatements of income and selected operational data for the ninesix months ended SeptemberJune 30, 20172021 and 20162020 (in thousands)millions, except percentages)*.
(Unaudited)Six Months Ended
June 30, 2021		% of Total
Revenues, net		Six Months Ended
June 30, 2020		% of Total
Revenues, net		Increase
(decrease)		% Change
Revenues, net:
North America$845.6 66.3 %$792.1 66.8 %$53.5 6.8 %
Brazil167.6 13.1 %174.1 14.7 %(6.5)(3.8)%
International262.8 20.6 %220.0 18.5 %42.8 19.4 %
Total revenues, net1,276.0 100.0 %1,186.2 100.0 %89.8 7.6 %
Consolidated operating expenses:
Processing238.7 18.7 %355.0 29.9 %(116.3)(32.8)%
Selling115.3 9.0 %98.2 8.3 %17.1 17.4 %
General and administrative223.4 17.5 %192.8 16.3 %30.5 15.8 %
Depreciation and amortization134.9 10.6 %126.6 10.7 %8.3 6.6 %
Other operating, net81 — %(0.3)— %(0.3)NM
Operating income563.6 44.2 %413.8 34.9 %149.8 36.2 %
Investment gain— — %(31.3)(2.6)%31.3 (100.0)%
Other expense (income), net2.2 0.2 %(6.9)(0.6)%9.0 NM
Interest expense, net63.2 5.0 %68.1 5.7 %(4.9)(7.1)%
Provision for income taxes117.7 9.2 %78.4 6.6 %39.3 50.2 %
Net income$380.5 29.8 %$305.5 25.8 %$74.9 24.5 %
Operating income for segments:
North America$341.2 $218.9 $122.3 55.9 %
Brazil65.6 68.9 (3.3)(4.8)%
International156.8 126.0 30.8 24.4 %
Operating income$563.6 $413.8 $149.8 36.2 %
Operating margin for segments:
North America40.4 %27.6 %12.7 %
Brazil39.1 %39.5 %(0.4)%
International59.7 %57.3 %2.4 %
Consolidated44.2 %34.9 %9.3 %
(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)% 

NM = Not Meaningful
*The sum of the columns and rows may not calculate due to rounding.


33

Revenues, net
Our consolidated revenues increased from $1,316.6were $1,276.0 million, in the ninesix months ended SeptemberJune 30, 2016 to $1,639.52021, an increase of $89.8 million, or 7.6%, from $1,186.2 million in the ninesix months ended SeptemberJune 30, 2017, an2020. Organically, consolidated revenues increased by approximately 7%. Consolidated revenues and organic growth increased primarily due to increases in transaction volume as the business recovered from the effects of the COVID-19 pandemic. The increase was also due to the impact of $323.0 million, or 24.5%.acquisitions completed in 2020 and 2021 of approximately $27 million. The increase in our consolidated revenuerevenues was primarily due to:

The impact of acquisitions during 2016 and 2017, which contributed approximately $175 million in additional revenue.
Organic growth of approximately 9% on a constant fuel price, fuel spread margin, foreign currency and pro forma basis, drivenpartially offset by increases in both volume and revenue per transaction in certain of our payment programs.
Although we cannot precisely measure the negative 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 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.

These increases were partially offset by the impact of the disposition of the NexTraq business in July 2017 of approximately $10 million.
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.environment.
Although we cannot precisely measure the impact of the macroeconomic environment, in total we believe it had a negative impact on our International segment revenueconsolidated revenues for the ninesix months ended SeptemberJune 30, 20172021 over the comparable period in 20162020 of approximately $22 million. Unfavorable fuel price spreads had a negative impact on revenues of approximately $46 million. These decreases were partially offset by the favorable impact of fuel prices of approximately $16 million and favorable changes in foreign exchange rates of approximately $7 million.

North America segment revenues, net
North America segment revenues were $845.6 million in the six months ended June 30, 2021, an increase of $53.5 million, or 6.8%, from $792.1 million in the six months ended June 30, 2020. Organically, North America segment revenues increased by approximately 6%. North America revenues and organic growth increased primarily due to increases in transaction volume as the business recovered from the effects of the COVID-19 pandemic. The increase in North America revenues was also due to the impact of acquisitions completed in 2020 and 2021 of approximately $26 million, partially offset by the negative impact of the macroeconomic environment.
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 revenues in the six months ended June 30, 2021 over the comparable period in 2020 of approximately $24 million, driven primarily by unfavorable fuel price spreads of approximately $46 million. This decrease was partially offset by the favorable impact of fuel prices of approximately $15 million and favorable changes in foreign exchange rates of approximately $7 million in our cross-border business.

Brazil segment revenues, net
Brazil segment revenues were $167.6 million in the six months ended June 30, 2021, a decrease of $6.5 million or 3.8%, from $174.1 million in the six months ended June 30, 2020. Brazil revenues declined primarily due to the unfavorable impact of foreign exchange rates of approximately $18 million for the six months ended June 30, 2021 over the comparable period in 2020. These decreases were partially offset by organic growth in Brazil segment revenues of approximately 7%.

International segment revenues, net
International segment revenues were $262.8 million in the six months ended June 30, 2021, an increase of $42.8 million, or 19.4%, from $220.0 million in the six months ended June 30, 2020. Organically, International segment revenues increased by approximately 10%. International revenues and organic growth increased primarily due to increases in transaction volume as the business recovered from the effects of the COVID-19 pandemic. Although we cannot precisely measure the impact of the macroeconomic environment, in total we believe it had a positive impact on our International segment revenues in the six months ended June 30, 2021 over the comparable period in 2020 of approximately $20 million, driven primarily by favorable changes in foreign exchange rates of approximately $19 million driven primarily by our U.K. business, and the favorable impact of fuel prices of approximately $2 million. This was primarily due to unfavorable fluctuations in foreign exchange rates, partially offset by the impact of higher fuel prices.
Consolidated operating expenses
Merchant commissions. Merchant commissions increasedProcessing. Processing expenses were $238.7 million in the six months ended June 30, 2021, a decrease of $116.3 million, or 32.8%, from $78.8$355.0 million in the comparable prior period. Decreases in processing expenses were primarily due to lower bad debt expense of approximately $130 million, which included a write-off of a customer receivable in our cross-border payments business of approximately $90 million in the ninefirst quarter of 2020. These decreases were partially offset by expenses related to acquisitions completed in 2020 and 2021 of approximately $9 million.
Selling. Selling expenses were $115.3 million in the six months ended SeptemberJune 30, 2016 to $82.72021, an increase of $17.1 million, or 17.4%, from $98.2 million in the ninecomparable prior period. Increases in selling expenses were primarily due to higher commissions and other variable costs due to increased sales volumes in during the second quarter of 2021 and expenses related to acquisitions completed in 2020 and 2021 of approximately $8 million.
General and administrative. General and administrative expenses were $223.4 million in the six months ended SeptemberJune 30, 2017, an2021, an increase of $3.9$30.5 million, or 5.0%. This increase was15.8% from $192.8 million in the comparable prior period. Increases in general and
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administrative expenses were primarily due to the fluctuation of the margin between the wholesale cost and retail price of fuel and the impact of higher volumeacquisitions completed in certain revenue streams where merchant commissions are paid.2020 and 2021 of approximately $9 million, increased stock based compensation expense of $10 million and increased professional fees of $7 million.
Processing. Processing
Depreciation and amortization. Depreciation and amortization expenses increased from $256.7were $134.9 million in the ninesix months ended SeptemberJune 30, 2016 to $316.42021, an increase of $8.3 million, or 6.6% from $126.6 million in the nine months ended September 30, 2017, an increase of $59.7 million, or 23.2%.comparable prior period. Increases in processingdepreciation and amortization expenses were primarily due to expenses related to acquisitions completed in 20162020 and 20172021 of approximately $45 million, inclusive$7 million.

Investment gain. Investment gain 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 debt 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$31.3 million in the ninesix months ended SeptemberJune 30, 20162020 relates to $122.9 millionmarket value gains on our investment in bill.com during the nine months ended September 30, 2017, an increasesecond quarter of $30.2 million, or 32.6%. Increases in spending were primarily due to ongoing expenses related to acquisitions completed in 2016 and 2017 of approximately $19 million and additional spending in certain lines of business. 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 $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 and2020, which we sold 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 value2020.

Other expense (income), net. Other expense, net was other than temporary. We recorded a $44.6$2.2 million impairment loss in the Masternaut investment that includes adjustment for $31.4six months ended June 30, 2021, compared to other income, net of $6.9 million of currency losses previously recognized in accumulated other comprehensivethe six months ended June 30, 2020. Other income in the ninesix months ended SeptemberJune 30, 2017, in the accompanying Unaudited Consolidated Statements of Income.2020 includes a $7 million favorable purchase price settlement from our Cambridge acquisition.


Other (income)Interest expense, net.Other income, Interest expense, net was $173.6$63.2 million in the ninesix months ended SeptemberJune 30, 2017, compared to other expense, net2021, a decrease of $1.1$4.9 million, or 7.1%, from $68.1 million in the nine months ended September 30, 2016.comparable prior period. 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 increasedecrease in interest expense is primarily due to decreases in LIBOR and lower revolver borrowings, partially offset by 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.higher balances on our new term B loan. 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,
(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%
 Six Months Ended June 30,
(Unaudited)20212020
Term loan A1.62 %2.51 %
Term loan B1.86 %2.84 %
Revolving line of credit A, B & C USD Borrowings1.62 %2.60 %
Revolving line of credit B GBP Borrowings1.52 %1.86 %
Foreign swing line1.54 %1.83 %
The average unused credit facility fee for Domestic Revolver Athe Credit Facility was 0.35% and 0.30% in the nine month period ending Septemberin the six months ended June 30, 2017 and 2016, respectively.2021.
Loss on extinguishmentOn January 22, 2019, we entered into three interest rate swap contracts. The objective of debt. Loss on extinguishmentthese interest rate swap contracts is to reduce the variability of debt of $3.3 million relates to our write-off of debt issuance costscash flows in the previously unhedged interest payments associated with $2.0 billion of variable rate debt, tied to the refinancingone month LIBOR benchmark interest rate. During the six months ended June 30, 2021, as a result of our existing credit facility duringthese swaps, we incurred additional interest expense of approximately $24.5 million or 2.44% over the third quarteraverage LIBOR rates on $2 billion of 2017.borrowings.
Provision
Provision for income taxes. The provision for income taxes increased from $132.5and effective tax rate was $117.7 million and 23.6% in the ninesix months ended SeptemberJune 30, 2016 to $227.8 million in the nine months ended September 30, 2017,2021, an increase of $95.3$39.3 million, or 71.9%.50.2% change, from $78.4 million and 20.4%, respectively, in the comparable prior period. We provide for income taxes during interim periods based on an estimate of our effective tax rate for the year. Discrete items and changes in the estimate of the annual tax rate are recorded in the period they occur. Our effective tax rate was 33.2% for the nine months ended September 30, 2017 as compared to 27.1% in the nine months ended September 30, 2016. The increase in the provision for income taxes was duedriven 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 chargeby an increase in pre-tax earnings. The increase in the quarter, which had no corresponding tax benefit. The 2016effective 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 subjectprimarily due to income tax. The 2016 rate was also favorably impacted by higherless excess tax benefitsbenefit on share-based compensationstock option exercises in 2016 versus 2017.

2021 over the comparable period in 2020.
We pay taxes in many different taxing jurisdictions, including the U.S.,US, most U.S.US states, and many non-U.S.non-US jurisdictions. The tax rates in certain non-U.S.non-US taxing jurisdictions are lowerdifferent than the U.S.US 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,above, our net income increased from $357.0was $380.5 million in the ninesix months ended SeptemberJune 30, 2016 to $457.52021, an increase of $74.9 million, or 24.5% from $305.5 million in the ninesix months ended September 30, 2017, an increase of $100.5 million, or 28.2%.2020.
Operating income and operating margin
Consolidated operating income. Operating income increased from $538.2was $563.6 million in the ninesix months ended SeptemberJune 30, 2016 to $643.72021, an increase of $149.8 million, or 36.2%, from $413.8 million in the nine months ended September 30, 2017, an increase of $105.6 million, or 19.6%.comparable prior period. Our operating margin was 40.9%44.2% and 39.3%34.9% for the ninesix months ended SeptemberJune 30, 20162021 and 2017,2020, respectively. The increaseThese increases were primarily driven by the write-off of a customer receivable in operating income was primarily due to acquisitions completedour cross-border payments business of approximately $90 million in 2016 and 2017,the first quarter of 2020, increases in volume as the business recovered from the effects of the COVID-19 pandemic driving organic growth, as well as the positive impact of the macroeconomic environmentfavorable fuel prices of approximately $14$16 million driven primarily byand favorable fuel prices,movements in foreign exchange rates of approximately $6 million These increases were partially offset by the unfavorable impact of fluctuations in foreign exchange rates. These increases were partially offset by the negative impactfuel spread margins 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 of approximately $19 million and the disposition of the NexTraq business in July 2017 of approximately $4$46 million.
35

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.


North America segment operating income. North America operating income increased from $367.2was $341.2 million in the ninesix months ended SeptemberJune 30, 2016 to $394.62021, an increase of $122.3 million, or 55.9%, from $218.9 million in the nine months ended September 30, 2017, an increase of $27.4 million, or 7.5%.comparable prior period. North America operating margin was 38.6%40.4% and 38.0%27.6% for the ninesix months ended SeptemberJune 30, 20162021 and 2017,2020, respectively. The increase in 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 million in the nine months ended September 30, 2016 to $249.1 million in the nine months ended September 30, 2017, an increase of $78.1 million, or 45.7%. International operating margin was 46.7% and 41.4% for the nine months ended September 30, 2016 and 2017, respectively. The increase in operating income was due primarily to the write-off of a customer receivable in our cross border payments business of approximately $90 million in the first quarter of 2020, increases in volume as the business recovered from the effects of the COVID-19 pandemic driving organic growth, the impact of acquisitions completedfavorable fuel prices of approximately $15 million and favorable movements in 2016 and 2017, organic growth.the foreign exchange rates of $3 million. These increases were partially offset by the negativeunfavorable impact of higher amortization and depreciation expense related to acquisitionsfuel spread margins of STP and Travelcard completed$46 million.

Brazil segment operating income. Brazil operating income was $65.6 million in the third quartersix months ended June 30, 2021, a decrease of 2016, additional bad debt expense of $9$3.3 million, due to bad debt inherentor 4.8%, from $68.9 million in the acquired STP business, additional stock based compensation of approximately $5 millioncomparable prior period. Brazil operating margin was 39.1% and 39.5% for the negative impact of the macroeconomic environment of approximately $4 million, drivensix months ended June 30, 2021 and 2020, respectively. These decreases were due primarily byto the unfavorable impact of fluctuations in foreign exchange rates.rates of $8 million. The decreases were partially offset by the favorable impact of organic growth in Brazil.

International segment operating income. International operating income was $156.8 million in the six months ended June 30, 2021, an increase of $30.8 million, or 24.4%, from $126.0 million in the comparable prior period. International operating margin was 59.7% and 57.3% for the six months ended June 30, 2021 and 2020, respectively. These increases were primarily due to an increase in transaction volume as the business recovered from the effects of the COVID-19 pandemic driving organic growth, the favorable impact of foreign exchange rates of $11 million and the favorable impact of fuel prices of $2 million.

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 foreseeable future, based on our current assumptions. At SeptemberJune 30, 2017,2021, we had approximately $2.5 billion in total liquidity, consisting of approximately $1.2 billion available under our Credit Facility (defined below) and unrestricted cash balances totaled $1,018.3 million, with approximately $183.5 million restricted.of $1.3 billion. Restricted cash represents primarily customer deposits in the Czech Republic and in our Comdata business in the U.S., as well as collateral received from customers for cross-currency transactions in our cross-border payments business, which we are restricted from usinguse other than to repay customer deposits.
At September 30, 2017, cash and cash equivalents held in foreign subsidiaries where we have determined we are permanently reinvested is $509.3 million. All of the cash and cash equivalents held by our foreign subsidiaries, excluding restricted cash, are available for general corporate purposes. Our current intent is to permanently reinvest these funds outside of the U.S. Our current expectation for funds held 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 provideddeposits, as well 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.

secure and settle cross-currency transactions.
We also utilize an accounts receivable Securitization Facility to finance a majority of our domestic fuel card receivables, to lower our cost of borrowing and more efficiently use capital. We generate and record accounts receivable when a customer makes a purchase from a merchant using one of our card productssolutions and generally pay merchants before collecting the receivable. As a result, we utilize the Securitization Facility as a source of liquidity to provide 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. We also consider the undrawn amounts under our Securitization Facility and Credit Facility as funds available for working capital purposes and acquisitions. At SeptemberJune 30, 2017,2021, we had no additional liquidity under our Securitization Facility. At September 30, 2017, we had approximately $612 million available under
The Company has determined that outside basis differences associated with our Credit Facility.investment in foreign subsidiaries would not result in a material deferred tax liability, and consistent with our assertion that these amounts continue to be indefinitely reinvested, have not recorded incremental income taxes for the additional outside basis differences.
BasedWe cannot assure you that our assumptions used to estimate our liquidity requirements will remain accurate due to the unprecedented nature of the disruption to our operations and the unpredictability of the ongoing COVID-19 global pandemic. As a consequence, our estimates of the duration of the pandemic and the severity of the impact on our current forecastsfuture earnings and anticipated market conditions, we believe thatcash flows could change and have a material impact on our current cash balances, our available borrowing capacityresults of operations and our ability to generate cash from operations, will be sufficient to fund our liquidity needs 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 issuancefinancial condition.
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Table of debt or equity securities. We may not be able to obtain additional financing on terms favorable to us, if at all.Contents

Cash flows
The following table summarizes our cash flows for the nine monthssix month periods ended SeptemberJune 30, 20172021 and 20162020 (in millions).
Six Months Ended June 30,
(Unaudited)20212020
Net cash provided by operating activities$356.4 $802.2 
Net cash used in investing activities(163.0)(37.4)
Net cash provided by (used in) financing activities358.7 (1,032.4)
  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 $404.3was $356.4 million in the ninesix months ended SeptemberJune 30, 2016 to $419.52021, a decrease from $802.2 million in the nine months ended September 30, 2017. Includedcomparable prior period. The decrease in operating cash flows from operating activities were favorable non-cash adjustments of $151.7 million in the nine months ended September 30, 2017. Non-cash adjustments were drivenwas 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 business in the third quarter of 2017. Also included in cash flows from operating activities weredue to unfavorable working capital adjustments of $189.7 million. Working capital adjustments aremovements primarily due to the timing of cash receipts and payments duringin the ninesix months ended SeptemberJune 30, 20172021 over the comparable period in 2016.2020.
Investing activities. Net cash used in investing activities decreased from $1,371.5was $163.0 million in the ninesix months ended SeptemberJune 30, 20162021 compared to $341.6$37.4 million in the ninesix months ended SeptemberJune 30, 2017.2020. The decreaseincreased use of cash was primarily due to the reductionincrease in cash outlaypaid for acquisitions andin the proceeds received fromsix months ended June 30, 2021 over the sale of our Nextraq business during the third quarter of 2017.comparable period in 2020.
Financing activities. Net cash provided by financing activities decreased from $976.4was $358.7 million in the ninesix months ended SeptemberJune 30, 20162021, compared to $250.1net cash used in financing activities of $1,032.4 million in the ninesix months ended SeptemberJune 30, 2017.2020. The decreaseincrease in net cash provided by financing activities iswas primarily due to an increase in debt repayments of $437.4 millionincreased net borrowings on our credit facility in the nine months ended September 30, 2017 as compared to 2016,Credit Facility of $711 million, increased spending to repurchasenet borrowings on our common stockSecuritization Facility of $367$617 million and a decrease in borrowingsrepurchases of $76.8our common stock of $141 million on our credit facility, partially offset by an increase in borrowings of $161 million on our Securitization Facility.the six months ended June 30, 2021 over the comparable period in 2020.
Capital spending summary
Our capital expenditures increased from $41.9were $45.8 million in the ninesix months ended SeptemberJune 30, 2016 to $49.52021, an increase of $8.9 million or 24.1%, from $36.9 million in the nine months ended September 30, 2017, an increase of $7.6 million, or 18.1%. This increase is primarilycomparable prior period due to increased spending on strategic projects, includingthe impact of acquisitions and continued investmentinvestments in our operating systems, as well as incremental spending related to acquisitions in 2016 and 2017.

technology.
Credit Facility
FleetCorFLEETCOR Technologies Operating Company, LLC, and certain of our domestic and foreign owned subsidiaries, as designated co-borrowers (the “Borrowers”), hasare parties to a $4.33$5.625 billion Credit Agreement (the "Credit Agreement"), with Bank of America, N.A., as administrative agent, swing line lender and local currency issuer, and a syndicate of financial institutions (the “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 billion, a term loan A facility in the amount of $2.69$3.225 billion and a term loan B facility in the amount of $350.0 million$1.150 billion as of SeptemberJune 30, 2017.2021. 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 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-currencywith borrowings in U.S. dollars, Australian Dollarsdollars or New Zealand Dollars.dollars. The Credit Agreement also includes an accordion feature for borrowing an additional $750 million in term loan A, term loan B, revolving A or revolving B facility debt and an unlimited amount when the leverage ratio on a pro-forma basis is less than 3.00 to 1.00. Proceeds from the credit facilities may be used for working capital purposes, acquisitions, and other general corporate purposes. On January 20, 2017,April 24, 2020, we entered into the secondeighth amendment to the Credit Agreement which establishedto add a new term B loan.$250 million revolving D facility. On August 2, 2017,20, 2020, we determined that, due to a recovery in our business operations and other safeguards being in place, the revolving D facility was no longer necessary and the facility was terminated. The maturity date for the term loan A and revolving credit facilities A, B and C is December 19, 2023. On April 30, 2021, we entered into the thirdninth amendment to the Credit Agreement. The amendment provided for a new seven-year $1.150 billion term loan B. The existing term loan B was paid off with proceeds from the new term loan B. The new term loan B has a maturity date of April 30, 2028, and interest rates remain unchanged.
Interest on amounts outstanding under 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(other than the term B maturity date is August 2,2024. The term A and revolver pricing remainsloan B) accrues based on the same andBritish Bankers Association LIBOR Rate (the "Eurocurrency Rate"), plus a margin based on a leverage ratio, or at our option, the Base Rate (defined as the rate equal to the highest of (a) the Federal Funds Rate plus 0.50%, (b) the prime rate announced by Bank of America, N.A., or (c) the Eurocurrency Rate plus 1.00%) plus a margin based on a leverage ratio. Interest on the term loan B pricing was reduced by 25 basis points to LIBORfacility accrues based on the Eurocurrency Rate plus 200 basis points.1.75% for Eurocurrency Loans or the Base Rate plus 0.75% for Base Rate Loans. The Eurocurrency rate has a 0% floor. In addition, we pay a quarterly commitment fee at a rate per annum ranging from 0.20%0.25% to 0.40%0.35% of the daily unused portion of the credit facility.Credit Facility.
The Credit Agreement also contains an accordion feature for borrowing an additional $750 million in term A or revolver A and term B. Proceeds fromAt June 30, 2021, the Credit Facility may be used for working capital purposes, acquisitions, and other general corporate purposes.
The term loans are payable in quarterly installments and are dueinterest rate on the last business day of each March, June, September, and December withterm loan A was 1.60%, the final principal payment dueinterest rate on the respective maturity date. Borrowingsterm loan B was 1.85% and the interest rate on the revolving line ofA facility was 1.60%. The unused credit are repayablefacility fee was 0.30% at our option of one, two, three or nine months after borrowing, dependingJune 30, 2021.
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At June 30, 2021, we had $2.8 billion in borrowings outstanding on the term loan A, net of the borrowingdiscounts, and $1.1 billion in borrowings outstanding on the facility. Borrowingsterm loan B, net of discounts. We have unamortized debt issuance costs of $4.1 million related to the revolving facilities as of June 30, 2021 recorded within other assets in the Unaudited Consolidated Balance Sheet. We have unamortized debt discounts of $8.7 million and debt issuance costs $6.3 million related to our term loans at June 30, 2021.
During the six months ended June 30, 2021, we made principal payments of $419 million on the foreignterm loans, $624 million on the revolving facilities, and $52 million on the swing line of credit are due no later than ten business days after such loan is made.revolving facility.
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 on the ability to pay dividends and make other restricted payments under certain circumstances and compliance with certain financial ratios. As of SeptemberJune 30, 2017,2021, we were in compliance with each of the covenants under the Credit Facility.Agreement.
At September 30, 2017,Cash Flow Hedges
On January 22, 2019, we had $2,690entered into three swap contracts. The objective of these swap contracts is 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. For each of these swap contracts, we pay a fixed monthly rate and receive one month LIBOR. We reclassified approximately $24.5 million in borrowings outstanding onof losses from accumulated other comprehensive income into interest expense during 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 ninesix months ended SeptemberJune 30, 2017, we made principal payments2021 as a result 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.these hedging instruments.
Securitization Facility
We are a party to a $1.0 billion receivables purchase agreement among FleetCorFLEETCOR 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 fifth time as of November 14, 2014.thereto. We refer to this arrangement as the Securitization Facility. There have been several amendments to the Securitization Facility. The current purchase limit underOn November 13, 2020, we extended the Securitization Facility is $950termination date to November 12, 2021, added an uncommitted accordion to increase the purchase limit by up to $500 million, revised obligor concentration limits and reserve calculations, added a 0.375% LIBOR floor and modified certain swing line terms. In addition, the program fee for LIBOR borrowings increased from 0.90% to 1.25% and the program fee for Commercial Paper Rate borrowings increased from 0.80% to 1.15%. On March 29, 2021, we amended the Securitization Facility expires on November 14, 2017.to include a new three year maturity date, reduced the LIBOR floor to 0 bps, improved margins, and increased the swing line from $100 million to $250 million. The maturity date for our 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.
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.March 29, 2024.
We were in compliance with the financial covenant requirements related to our Securitization Facility as of SeptemberJune 30, 2017.2021.
Stock Repurchase Program

On February 4, 2016, ourThe Company's Board of Directors has approved a stock repurchase program (the(as updated from time to time, the "Program") under which we may purchase up, authorizing the Company to an aggregate of $500 million of ourrepurchase its common stock over the following 18 month period.from time to time until February 1, 2023. On July 27, 2017, our2021, the Board of Directors authorized an increase inincreased the aggregate size of the Program by an additional $250 million and an extension$1 billion, to $5.1 billion, leaving the Company up to $1.6 billion available under the Program for future repurchases in shares of its common stock. Since the beginning of the Program bythrough June 30, 2021, 16,184,095 shares have been repurchased for an additional 18 months. On November 1, 2017, we announced that our Boardaggregate purchase price 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$3.5 billion. With the increase and giving effect to our $590 million of previous repurchases, we may repurchase up to $510 million in shares of our 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. .
Pending Acquisition
On August 3, 2017, as part of the Program,July 28, 2021, we entered an Accelerated Share Repurchasesigned a definitive agreement ("ASR Agreement") withto acquire ALE Solutions, Inc. (ALE), a third-party financial institution to repurchase $250 million of its common stock. PursuantU.S. based leader in lodging solutions 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.insurance industry, for approximately $400 million. 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 deliveredtransaction is expected 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 millionclose during the third quarter of 2017, which is net2021, subject to regulatory approval and closing conditions.

38
Table 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.Contents

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, revenuerevenues 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 ninethree months ended SeptemberJune 30, 2017, other than noted in footnote 1, "Summary of Significant Accounting Policies",2021, 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, 2016.2020. 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, 20162020 and our summary of significant accounting policies in Note 1 of our notesNotes to the unaudited consolidated financial statementsUnaudited Consolidated Financial Statements in this Quarterly Report on Form 10-Q.
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 theeach 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
Pro forma and macro adjusted revenue and transactions by solution. We have defineddefine the non-GAAP measurepro forma and macro adjusted revenuesrevenue 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 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 basisrevenue and transactions to evaluate our revenues, net of the commissions that are paid to merchants to participateorganic growth in our card programs. The commissions paidrevenue and the associated transactions.
Organic revenue growth is calculated as revenue growth 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 merchants can vary when market spreads fluctuate in muchinclude or remove the same way as revenues are impacted when market spreads fluctuate.impact of acquisitions and/or divestitures and non-recurring items that have occurred subsequent to that period. We believe that adjustedorganic revenue is an appropriate supplemental measure of financial performancegrowth on a macro-neutral, one-time item, and may beconsistent acquisition/divestiture/non-recurring item basis is useful to investors tofor understanding our revenuethe 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.
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Set forth below is a reconciliation of pro forma and macro adjusted revenuesrevenue and key performance metric by solution to the most directly comparable GAAP measure, revenues,revenue, net and key performance metric (in thousands)millions):
Revenues, netKey Performance Metric
Three Months Ended June 30,Three Months Ended June 30,
(Unaudited)2021*2020*2021*2020*
FUEL - TRANSACTIONS
Pro forma and macro adjusted$298.1 $250.1 118.3 99.8 
Impact of acquisitions/dispositions— (0.3)— (0.2)
Impact of fuel prices/spread(13.9)— — — 
Impact of foreign exchange rates10.9 — — — 
As reported$295.1 $249.8 118.3 99.7 
CORPORATE PAYMENTS - SPEND
Pro forma and macro adjusted$135.8 $102.7 22,859 17,583 
Impact of acquisitions/dispositions— (10.2)— (3,912)
Impact of fuel prices/spread0.2 — — — 
Impact of foreign exchange rates4.4 — 4 — 
As reported$140.4 $92.6 22,862 13,672 
TOLLS - TAGS
Pro forma and macro adjusted$70.5 $64.8 5.8 5.3 
Impact of acquisitions/dispositions— — — — 
Impact of fuel prices/spread— — — — 
Impact of foreign exchange rates0.9 — — — 
As reported$71.3 $64.8 5.8 5.3 
LODGING - ROOM NIGHTS
Pro forma and macro adjusted$62.2 $44.8 6.6 5.0 
Impact of acquisitions/dispositions— (4.2)— (0.4)
Impact of fuel prices/spread— — — — 
Impact of foreign exchange rates— — — — 
As reported$62.2 $40.6 6.6 4.6 
GIFT - TRANSACTIONS
Pro forma and macro adjusted$32.3 $26.5 259.4 188.2 
Impact of acquisitions/dispositions— — — — 
Impact of fuel prices/spread— — — — 
Impact of foreign exchange rates— — — — 
As reported$32.3 $26.5 259.4 188.2 
OTHER1- TRANSACTIONS
Pro forma and macro adjusted$63.5 $50.8 9.3 9.0 
Impact of acquisitions/dispositions— — — — 
Impact of fuel prices/spread— — — — 
Impact of foreign exchange rates2.5 — — — 
As reported$66.0 $50.8 9.3 9.0 
FLEETCOR CONSOLIDATED REVENUES
Pro forma and macro adjusted$662.3 $539.8 Intentionally Left Blank
Impact of acquisitions/dispositions— (14.6)
Impact of fuel prices/spread2
(13.7)— 
Impact of foreign exchange rates18.7 — 
As reported$667.4 $525.1 
* Columns may not calculate due to rounding.
1 Other includes telematics, maintenance, food, transportation and payroll card related businesses.
2 Revenues reflect an estimated $14 million net negative impact of fuel prices and fuel price spreads, with $16 million positive impact from fuel prices and $30 million negative impact from fuel spread.
  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 statementStatement of income,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 shareother non-recurring items, including unusual credit losses occurring largely, but not necessarily exclusively, due to the COVID-19 pandemic, the impact of amortization of intangible assets at our Masternaut investment, (e) a non-recurring net gain at our Masternaut investment (f)discrete tax items, impairment of our Masternaut investment, (g) net gain oncharges, asset write-offs, restructuring costs, gains due to disposition of business, (h)assets/businesses, loss on extinguishment of debt, and (i) a non-recurring loss due to mergerlegal settlements.
40
Table of entities.Contents

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 useAdjusted net income and adjusted net income to eliminate the effectper diluted share are supplemental measures of itemsoperating 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 U.S. generally accepted accounting principles, or U.S. GAAP. We believe it is useful to exclude non-cash stock basedshare-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 stockshare 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-recurringthat certain expenses and recoveries (e.g. legal settlements, write-off of customer receivable, etc.), gains and losses on investments, and impairment charges do not necessarily reflect how our investmentinvestments and business is performing.We believe thatare performing. We adjust net income for the tax effect of each of these non-tax items.
Management uses adjusted net income, and adjusted net income per diluted share are appropriate supplemental measuresand organic revenue growth:
•as measurements of financialoperating performance and may be useful to investors to understandingbecause they assist us in comparing our operating performance on a consistent basis. Adjusted net incomebasis;
•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 measuresevaluate 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 U.S. 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, Three Months Ended June 30,Six Months Ended June 30,
(Unaudited) 2017 2016 2017 2016(Unaudited)2021202020212020
Net income $202,823
 $129,618
 $457,503
 $356,961
Net income$196,247 $158,488 $380,486 $305,548 
Net income per diluted share 2.18
 1.36
 4.87
 3.75
Net income per diluted share$2.30 $1.83 $4.45 $3.50 
Stock based compensation 24,654
 17,405
 68,897
 50,025
Stock based compensation17,885 8,989 35,632 23,164 
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) —
Amortization1
Amortization1
52,525 47,875 102,101 97,917 
Investment gainInvestment gain— (33,709)(9)(31,338)
Loss on extinguishment of debt 3,296
 —
 3,296
 —
Loss on extinguishment of debt6,230 — 6,230 — 
Non recurring loss due to merger of entities 2,028
 —
 2,028
 —
Non-recurring net gain at Masternaut investment —
 —
 —
 (10,845)
Integration and deal related costsIntegration and deal related costs7,823 5,902 11,493 9,267 
Restructuring and related (subsidies) costsRestructuring and related (subsidies) costs(777)4,727 (1,354)4,727 
Legal settlements/litigationLegal settlements/litigation1,388 944 5,058 (5,037)
Write-off of customer receivable2
Write-off of customer receivable2
— — — 90,058 
Total pre-tax adjustments 25,602

69,417
 187,003

168,423
Total pre-tax adjustments85,074 34,727 159,151 188,758 
Income tax impact of pre-tax adjustments at the effective tax rate1
 (25,656) (15,726) (69,711) (46,425)
Income taxes3
Income taxes3
(12,910)4,211 (29,079)(32,385)
Adjusted net income $202,769
 $183,310
 $574,795
 $478,959
Adjusted net income$268,411 $197,425 $510,559 $461,922 
Adjusted net income per diluted share $2.18
 $1.92
 $6.12
 $5.03
Adjusted net income per diluted share$3.15 $2.28 $5.97 $5.29 
Diluted shares 93,001
 95,307
 93,923
 95,204
Diluted shares85,295 86,570 85,528 87,380 
1 Includes amortization related to intangible assets, premium on receivables, deferred financing costs and debt discounts.
2 Represents a loss in the first quarter of 2020 from a large client in our cross-border payments business entering voluntary bankruptcy due to the impact of the COVID-19 pandemic.
3 Represents provision for income taxes of pre-tax adjustments. 2021 includes measurement of deferreds due to the increase in UK corporate tax rate from 19% to 25% of $6.5 million. 2020 includes a tax reserve adjustment related to prior year tax positions of $9.8 million.
*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 and Macro Adjusted Revenue and Transactions by Product

We define pro forma and macro adjusted revenue as revenue, 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):*
41
  Revenue Transactions
  Three Months Ended September 30,Three Months Ended September 30,
(Unaudited) 2017 2016 2017 
20164
FUEL CARDS        
Pro forma and macro adjusted2,3
 $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 adjusted2,3
 $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 adjusted2,3
 $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 adjusted2,3
 $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 adjusted2,3
 $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 adjusted2,3
 $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 adjusted2,3
 $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.


Special Cautionary Notice Regarding Forward-Looking Statements
This reportQuarterly 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'sFLEETCOR’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” or “expect,” “may,” “will,” “would,” “could” or “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 delaysincluding those discussed in "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the Securities and Exchange Commission on February 26, 2021, many of which are outside of our control, that could cause our actual results and experience to differ materially from any forward-looking statement.

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

•regulatory measures, voluntary actions, or failures associated with implementation; fuel price and spread volatility; changes in credit riskconsumer preferences, that impact our transaction volume, including social distancing, shelter-in-place, shutdowns of customersnonessential businesses and associated losses;similar measures imposed or undertaken in an effort to contain and mitigate the actionsspread 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; COVID-19;
•the impact of macroeconomic conditions and whether expected trends, including foreign currency exchange rates, retail fuel prices, fuel price spreads, and fuel transaction patterns, develop as anticipated;
•our ability to successfully execute our strategic plan, manage our growth and achieve our performance targets;
•our ability to attract new and retain existing partners, fuel merchants, and lodging providers, their promotion and support of our solutions, 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, on operations, revenue and income; credit conditions, including changes in borrowers’ credit risks and payment behaviors;
•the effectsrisk of general economichigher borrowing costs and politicaladverse financial market conditions on fueling patternsimpacting our funding and the commercial activity of fleets, risks related to litigation; liquidity, and any reduction in our credit ratings;
•our ability to complete an accelerated share repurchase,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;
•the international operational and political risks and compliance and regulatory risks and costs associated with international operations;
•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 recently 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 risksfactors and uncertainties identifiedinformation in our Annual Report on Form 10-K and other filings that we make with the SEC under the captionExchange Act and Securities Act. See “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, 20172020 filed with the Securities and Exchange Commission on March 1, 2017 and August 8, 2017, respectively. These factors could cause our actual results and experience to differ materially from any forward-looking statement. February 26, 2021.

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.

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Table of Contents

You may get FLEETCOR’s Securities and Exchange Commission (“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 the Company 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 SeptemberJune 30, 2017, other than noted above,2021, 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, 2016.2020.

Item 4.Controls and Procedures
Evaluation of Disclosure Controls and Procedures
As of SeptemberJune 30, 2017,2021, 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 SeptemberJune 30, 2017,2021, 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.
There were no changes in our internal control over financial reporting during the quarter ended SeptemberJune 30, 2017,2021, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

43

PART II—OTHER INFORMATION

Item 1.Legal Proceedings

In the ordinary course of business, we are subject tothe Company is involved in various pending and potentialor 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 on behalf of the Company. The derivative complaintFederal Derivative Action 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 false and misleading public statements concerning the Company’s fee charges, and financial and business prospects; and that certain defendants breached their fiduciary duties through allegedly improper sales of stock. The complaint seeks unspecified monetary damages on behalf of the Company, corporate governance reforms, disgorgement of profits, benefits and compensation by the defendants, restitution, costs, and attorneys’ and experts’ fees. On August 18, 2017,September 20, 2018, the court entered an order deferring the caseFederal Derivative Action pending a ruling on motions for summary judgment in the defendants' motion to dismissshareholder class action, notice a settlement has been reached in the putative shareholder class action, or until otherwise agreed to by the parties. After preliminary approval of the proposed settlement of the shareholder class action was granted, the stay on the Federal Derivative Action was lifted. Plaintiffs amended their complaint on February 22, 2020. FLEETCOR filed a motion to dismiss the amended complaint in the Federal Derivative Action on April 17, 2020, which the court granted without leave to amend on October 21, 2020. Plaintiffs filed a notice of appeal to the United States Court of Appeals for the Eleventh Circuit on November 18, 2020. The appeal is pending.
On January 9, 2019, a similar shareholder derivative complaint was filed in the Superior Court of Gwinnett County, Georgia (“State Derivative Action”), which was stayed pending a ruling on motions for summary judgment in the shareholder class action, notice a settlement has been reached in the shareholder class action, or until otherwise agreed by the parties. On the parties’ joint motion, the court has continued the stay of the State Derivative Action “pending further developments in the first-filed Federal Derivative Action.” The defendants dispute the allegations in the complaintderivative complaints and intend to vigorously defend against the claims.
Estimating an amountFTC 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; the briefing on both parties’ summary judgment motions was completed on July 12, 2021. The Company has incurred and continues to incur legal and other fees related to this 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. At this time, the Company believes the possible range of possible losses resulting fromoutcomes includes continuing litigation proceedings is inherently difficult and requires an extensive degreeor discussions leading to a settlement, or the closure of judgment, particularly where thethese 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 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.without further action.
Item 1A.Risk Factors

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, 20162020 and in Part II, Item 1A.1A, "Risk Factors" in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2017 filedother 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 have been no material changes from the risk factors previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016.

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 andfinancial 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 mitigateFor example, these risks we enter into derivative contracts. However, these contracts do not eliminate all of thenow include 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,COVID-19 pandemic 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.
related economic developments.
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Item 2.Unregistered Sales of Equity Securities and Use of Proceeds
On February 4, 2016, ourThe Company's Board of Directors has approved a stock repurchase program (the(as updated from time to time, the "Program") under which we may begin purchasing upauthorizing the Company to an aggregate of $500 million of the Company'srepurchase its common stock over the following 18 month period.from time to time until February 1, 2023. On July 27, 2017,2021, the Company's Board of Directors authorized an increase inincreased 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,$1 billion, to $5.1 billion, leaving 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 authorizedup to $1.6 billion available under the Program for future repurchases in shares of $1.1 billion.its common stock. Since the beginning of the Program 4,114,104through June 30, 2021, 16,184,095 shares have been repurchased for an aggregate purchase price of $590 million$3.5 billion.
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 repurchased.and are expected to be funded by a combination of available cash flow from the business, working capital and debt.
The following table presents information as of June 30, 2021, with respect to purchases of common stock of the Company made during the three months ended SeptemberJune 30, 20172021 by the Company as defined in Rule 10b-18(a)(3) under the Exchange Act:Act.
PeriodTotal Number of Shares PurchasedAverage Price Paid Per ShareTotal Number of Shares Purchased as Part of the Publicly Announced PlanMaximum Value that May Yet be Purchased Under the Publicly Announced Plan (in thousands)
April 1, 2021 through April 30, 202110,550 $287.39 15,268,225 $833,222,564 
May 1, 2021 through May 31, 2021— $— 15,268,225 $833,222,564 
June 1, 2021 through June 30, 2021915,870 $265.51 16,184,095 $590,050,450 

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.

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Item 6. Exhibits

Exhibit
No.
2.13.1
Acquisition agreement to acquire Serviços e Tecnologia de Pagamentos S.A. (incorporated by reference to Exhibit 2.1 to the Registrant's Form 8-K, File No. 001-35004, filed with the Securities and Exchange Commission ("SEC") on March 18, 2016)
3.1
Amended and Restated Certificate of Incorporation of FleetCorFLEETCOR Technologies, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s Annual Report on Form 10-K, File No. 001-35004, filed with the SEC on March 25, 2011)
3.2
Certificate of Amendment to the Amended and Restated BylawsCertificate of FleetCorIncorporation of FLEETCOR Technologies, Inc. (incorporated by reference to Exhibit 3.23.1 to the Registrant's Current Report on Form 8-K, File No. 001-35004, file with the SEC on June 8, 2018)
3.3
Certificate of Amendment to the Amended and Restated Certificate of Incorporation of FLEETCOR Technologies, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K, File No. 001-35004, filed with the SEC on June 14, 2019)
3.4
Amended and Restated Bylaws of FLEETCOR Technologies, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s AnnualCurrent Report on Form 10-K,8-K, File No. 001-35004, filed with the SEC on October 28, 2016)2020)
4.110.1
FormEighth Amendment to the Fifth Amended and Restated Receivables Purchase Agreement, dated March 29, 2021 by and among FleetCor Funding LLC, FleetCor Technologies Operating Company, LLC, PNC Bank, National Association as administrator for a group of Stock Certificate for Common Stockpurchasers and purchaser agents, and certain other parties thereto (incorporated by reference to Exhibit 4.1 to Amendment No. 310.1 to the Registrant’s Registration StatementQuarterly Report on Form S-1,10-Q, File No. 333-166092,001-35004, filed with the SEC on June 29, 2010)May 10, 2021)
10.110.2
ThirdNinth Amendment to Credit Agreement, datedated as of August 2, 2017,April 30, 2021 among FleetCorFLEETCOR Technologies Operating Company, LLC, as the Company, FleetCorFLEETCOR 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/cL/C issuer, and the other lenders partyborrowers hereto Merrill Lynch, Pierce, Fenner & Smith Incorporated, as sole lead arranger and sole book runner (incorporated by reference to Exhibit 10.110.2 to the Registrant'sRegistrant’s Quarterly Report on Form 10-Q, File No. 001-35004, filed with the SEC on August 8, 2017)May 10, 2021)
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
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
101101*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


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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 NovemberAugust 9, 2017.2021.
FLEETCOR Technologies, Inc.
FleetCor Technologies, Inc.(Registrant)
(Registrant)
SignatureTitle
SignatureTitle
/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/ EricCharles R. DeyFreundChief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
EricCharles R. DeyFreund



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