INT - Earnings call transcript Q1 2018 | World Kinect Corporation

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the World Fuel Services 2018 First Quarter Earnings Conference Call. My name is Ash and I will be coordinating the call this evening.

During the presentation, all participants will be in a listen-only mode. After the speakers' remarks, there will be a question-and-answer session. Instructions on how to ask a question will be given at the beginning of the Q&A session. reminder, is a April recorded, As XXXX. XX, Instructions] this being conference Thursday, [Operator like the to Mr. now would I turn conference to over Glenn President, Vice Klevitz, and World Relations. Investor Assistant Treasurer Fuel's Mr. may your you Klevitz, conference. begin

Glenn Klevitz

Services World is World call, Good the President release call on evening earnings the call today our and introductions be presentation. available can call. welcome World By earnings now, Thank you, Chief Fuel's alongside Treasurer Ira webcast. have slide Chief To webcast first Glenn the and This Kasbar, and everyone you access XXXX Michael Klevitz, the Ash. quarter and am doing evening's on and our Assistant Financial via received to live our on Chairman Officer. and us Service this of webcasts, Corporation should also a copy are the Executive this Fuel Fuel's release. you website Vice icon. or all not, webcast I please will Executive click conference I If on visit access future Officer; With Birns, website.

measures could World from risks Fuel's Fuel's that results results or information. these Form of World any forward-looking the Securities light the information XX-K defined comments their are in statements no get World World future is to subject differ A directly or and these like be comparable description measures financial materially started, events. that reconciliation can release found A I results financial to and found projections of World Commission. including the filed World expectations measures the obligation of Regulation review Safe Fuel's release to differ also new materially statement. website. GAAP forward-looking most these uncertainties performance most statements Fuel's we be can on presentation Exchange cause other factors range Certain that non-GAAP made Fuel plans a press today, in to its publicly and includes financial cause could forward-looking Harbor reports regarding certain G. assumes included statements non-GAAP future to Before This from to revisions of risk to as on Fuel's would and with of about in actual are revise recent and these

We will be question-and-answer prepared then period. which followed begin several with minutes of by a will remarks,

investors introduce Chief As with calls prior ask this on line Executive media and that conference in mode. time, participate our Michael of private Chairman and Officer, Kasbar. to members like would we the At listen-only individual the I

Michael Kasbar

through good opened was Thank management, a afternoon year joining us will us rationalizing you, Q&A. for Glenn and focus the today. our everyone. areas. the in and us. executing some quarter portfolio I'll good save We parts of improvements recent comments Ira further in it from key take make Thanks benefiting operational for time cost and Ira? for we'll financials then on and a some Overall

Ira Birns

the volume was first oil increase quarter principally first that's year of compared the year-over-year to in offset when XXXX. you, from $X.XX lower $XX quarter, first Consolidated last segments which quarter land in quarter, everyone. to to compared billion, an increase the first Adjusted and of diluted shortly. for by in first to that's adjusted share for earnings million was the Mike good XX% $X.XX Today announced I quarter quarter $XXX,XXX and first the in the we last XXXX. compared part XX% prices, first of a of year. net Thank of up of that's the was up will marine $X.X the due quarter evening per increase income discuss revenue This

million metric largest growth Volume quarter our drivers down segment margin aviation operations tons XXX our a international tons, volume approximately well was in derived last North quarter, year-over-year. principally for first X% the as certain billion and volume to X.X exit The million in markets X in as segment approximately aviation year-over-year. in which million Asia XX% metric EMEA Pac marine X.X retail or up for relate unprofitable segment core to America about that's reduction spoke acquired the from our decision our or fuelling operations gallons in region physical the gallons quarter. was was and our Volume first Our our the or low operations. we

volume driven first X% gallons land with approximately gallon billion of X.XX XX volumes by total consolidated to quarter, trading first The during quarter Our volume represents year-over-year. in X.X quarter. activities down land a the of million was And million X% reduction XXXX. approximately is billion first in the XXX gallons gallons, segment segment first the quarter the decrease compared the gallons principally in set and equivalents that decline during or supply was and

of quarter website operational the XX-Q please financial reported as increase of or to last can compared and first the in are million following year. comprised found on of million a of million published acquisition in assist and as previously the expenses the quarter overview our webcast expenses $XX and profit today. our $X.X figures was non reconciling periods increase our expenses results of on exclude $XXX $X.X million of I as non X% operational first first the pretax Consolidated that's for our the in gross slide on presentation costs. earnings release. principally breakdown release last To quarter, be of our earnings operational operational the with that you non in Before all items related note highlighted well expenses severance continue non The

increase quarter the volumes in profit in expect contributions that's $XX margins first to quarter first driven last from despite of Europe region. gross in compared increased the contributions renewed from activities the to to year in business still government these our year-over-year increased course quarter the and America of the aviation government by also contract We Our spot of $XXX lower or from North decline contributed compared over an of million continues our NCS activity XXXX. when XX% Commercial segment million recently XXXX. increased and first and

As you quarter which increases second earlier. first driven aviation to quarter seasonal be principal gross principally profit The the $X business but segment should of down million, $XX generated our the sequential of X% results look the in $X year-over-year Marine million decline reasons expect gross or second X% strong quarter. we resale core profit driver the The or million that's year-over-year was up described by in sequentially.

risk driven and products. business our However, in by activity the the was sequential stronger-than-expected offshore increased principally of growth price sale management

increased likely alone in the first success of XX% to quarter in greater prices lines bunker in more increases which business. than contributed Continued these

the reduction Additionally, first the initiatives contributed segment profitability quarter. Marine to our cost in also positively

to ahead we delivering second are Looking in Marine. optimistic cautiously good the about another quarter, quarter

as the However same the first same the quarter were quarter to quarter. in at running at time date pace you the we are during

delivered The segment of principally in activities land by contribution gross benefited which increase X% increase $XXX our gross $X from quarter, or UK, profit strong Our million of in profit was year-over-year. in million first the demonstrating Gross global continued the in the the payment from an cold driven business solutions year-over-year, payments the our million winter platform. first our growth up with in XX% multiservice seasonally a $XX profit few of years. a associated FinTech that's was quarter first

we coming of off in in to quarter. decrease first the expected gains the the million is for results sequentially were in last $X.X provided we bad quarter's debt items our Operating sequentially. mean That segment on land quarter realized seasonal with nonoperational quarter provision and the Second call. down strong are in excluding first million but line up million $XXX $X.X estimate that year-over-year expenses

drive to to bad the expenses expenses quarter of again, our nonoperational year-over-year In down in reduction on million related nonmetric principally were relates recently to range be sequential up both increased more million million $X at operating companies repeat. are expense Excluding expense from remain cost year-over-year, initiatives, expenses, in line. year efficiencies related cost $X.X cost from and the XXXX interest Therefore, $XXX in or $X.X compared structure we the as million million of range million, offset improving Consolidated in commercial $XX quarter $XX as our up fourth XXXX. in acquired excluding in throughout our continually least well but to million which higher of and sequentially. to looking by we will basis expenses of dropping first million be company performance and principally the Last of was profit in a months solid XX% year's companies. and ratio XXXX to would $XXX evaluate operating in quarter million the in improvement profit This from year-over-year, income The Adjusted in $XXX expect in the XXX bottom cost is the EBITDA comprised reduction to decrease represents year. aim with the expenses the operations up the XXXX to well points million is our basis departments $XX.X first year-over-year $XX XXX in quarter acquired part as gross Non-operating to first we corporate focused for first to in XXXX expenses another segments XX reflecting first metric debt of million gross at we increase as million million items beyond. reduction benefit average was of quarter. end. that quarter. rates in points million $XX this quarter second functional the $XX last $X I the up additional $XXX quarter, and assume to programs. million interest the expense EBITDA Trailing of $XX of was the second interest principally

last in a a first was road quarters. rate few tax year. still likely reform. is to in our tax rate rocky the over quarter quarter the be of compared of a XX% bit Changes next in tax effective XX.X% the will of This first result Our

effects. up we by lower some first post-tax driven anticipated quarter reform rate than Our wind early

the the However, elements will or over likely post-tax our of year tax of the balance new to even many rate the mid-XXs, possibly due code reform. the again, higher increase most of to

cash was accounts end, negative flow with total in million opportunities, increase fuel and billion $X.X operating higher due investments at supporting strategic of historically principal $XXX seasonal sharp for $XXX fuel as increase an were to combined balance principally defined the first of the that's prices. the quarter prices of drivers approximately year-over-year, quarter. receivable million Our Inventory

These flows, classification in change however, from not have the timing sales this of investing of from look activity. amounts to our cash statement, that as a reflected result take quarter you accounting will which If million. standard, is This the $XXX flow applies is activities negative new in it operating option or you for standard activities. a cash impact resulted flow any see receivable new cash did operating the simply a at of to

quarter, this will $XXX offset flow So million by activities. from operations of $XXX million a cash you investing positive see of cash use from

which while full reviewing are the fuel forward. flow despite our going issue this remained for opportunities any delivering reasons to prices. cash quarter use the We currently on we in cash receivable amend the could for focused we to facilities, first described In eliminate positive higher event related year

So of and it our closing first from to solid segments delivered quarter. back quarter, fourth three turn I all before in the the Mike over significantly in rebounding results

time Our operating efficiencies adept at appropriate. of a commitment driving model. and our but work at have getting are in greater same hard business our in cost while to meaningfully so, efficiencies sequentially business, expenses ahead where continued lot the throughout more We growth, declined of we drive us investing still demonstrating our

to additional Q&A. So open commentary for the turn I'd before call to over call Mike like we to back the up not some

Michael Kasbar

you, Thank Ira.

add, business value differentiated growth the bring aviation volume marketplace. we the Our fuel to jet exemplifies

distribution winning our third-party we're of a inventory, technology formula is replicating all combination in Our and of that businesses.

Our job the costs is supply business doing of the business excellent an and repositioning managing chain. marine within

positioned logistic to LNG. well markets virtue meet XXXX of requirements by the to are and capabilities of marine our We distribution committed global the sourcing are including global and

touch clients lower results produced investment are allocating can distribution end a reallocating zero model a capital on to an products returns times more phone. We variable in smart which have levels trimming where in our to and inventory business, land order end

government accelerate reach. physical and capabilities. logistics well growth. Multiservice and and prospects NCS size and its about our Our global business continues modest to business we pipeline is performed to increasing remain demonstrate its profitable Despite complex sophistication its optimistic operational

and is dovetailing to Our of connect gas powered and our services small aggregates existing logistics medium-sized range Today a complex with XXX larger of group its territories. energy and base efficiency create demand purchasing broader which with and energy clients and client platform supply expanding global in natural a range that customers is our to and and simplicity we in efficiencies. nicely countries payments creates C&I operate

focus and reallocating and increased our sharpening an capital on operations. infrastructure rationalizing portfolio, SG&A have costs, We

methodology to methodically driving our OpEx using leaner are and system. allocate for management capital an better returns, growth. a ability We is agile This drive drive our to ratio improve

a this, the the of leveraging next As to operator now the our drive part like and Q&A. aggressively at technologies call to market we AI speed to cost begin cloud to I'd key over turn two to are over years. automation lower

Operator

Thank And [Operator Instructions] first Nolan from of you. the comes our Stifel. question Ben with line

line is open. Please proceed Your your question. with

Ben Nolan

would quarter don't the of uptick Ira, that is follow time was there like you're the is think XXXX for how that maybe critically to that in wanted aspect, that time marine think address like I to continuing business? the your are management, that preemptive to in business for to up are more that any you might seems beneficial long see something far the had really they're and -- it something people with there about I was in an their be importantly, first the crisis is you know, that's happen hedging part -- beginning mentioned in a regulations -- starting and and anything actually that thus or needs going you

Ira Birns

cover Marine. I'll Look so, of thanks XXXX the out part I some that we and your let of results saw on quarter Mike of question. incremental in described coming chime first the that, we're for first with question, happy the certainly of in the

the tough prices a one, of puzzle meaningfully. pretty the that's terms In up are hedging piece of

with some Thus associated we that are up us. we with got [thoroughly] component thought or quarter. We the what question halfway -- the quarter The in running to about them So at transactions thinking that really is not are more hedge pace, and Whether the into a some they wins first far it's second the it's for we spotty. tough continues quite how hedging more in doing through seen of people doing to might quarter, or couple or forecast. through quarter were quarter first about be nice have picked not sustainable quarter for third same that time. is the first the this were kind

drive much profitability purposely one those cautiously I to bid, optimistic because going are So that it really now. the like is the they use seems how difficult opportunities to word resurface incremental a know

Michael Kasbar

I add large further of And I got post the some lot bound the is hearing to some of think the to and fracking be incredibly about airlines color market in and news will that. hearing these which Iran, prices hedging. world believes By that stuff lot despite place Saudi just days, range are discipline what there capacity, seem that. of we in and worried, surprising Russia don't aren't talk people Despite greater spare are

part that. of our and to at it's and big So I forecasting its of sophisticated we're a so ready we ready mover not we're on think we're for be management more We inventory something own I use that have the comes [deed] pretty we're but in. if when capability, the volatility think but that offering

folks to exposure some more conservatively others. use their than that And manage

to most some On wait-and-see, hedging, people able with gone thinking well but and I the that to we the through of a approaches the people think get them. I we reasons incredible for there the are just are positioned for waiting, certainly LNG think XXXX been and to aware closer. lot the already, part it's economic come of deal that, not investments sitting that be marketplace folks taking are an on of will some I'm large as personally maybe [scrubbers]

Ben Nolan

a up come if in customers? thinking you I'm are little your higher. and then inventory about terms change you another in Is the from curious guys a is the is your that you how inventory was are much going bit perspective? to how there optimally and business levels inventory you guess agree are have structuring serve sheet structural that's and an or to I of should to balance think, need bit we that a how there Okay that forward thing something

Ira Birns

really that the increase, question, Not of quarter our the impact say, pieces core price Ben, if most a so drove I to factors two business day changed. the quarter moment again. puzzle day specific first inventory really would put those of that aside In nothing that were there I an for first the good the was had only involves really

the two the we're terms that land were inventory first are said the in was fact, of in we matter But of of marine. gallons of few holding, that steady impacting factors quarter is a As a just aviation pretty outside amount as marine. down

So marine quarter the is to that business we And had you was then inventory already profitability woods quarter like where add to that principal the in things things our one neck in levels worked this could here of et off customer business it of some And that seasonal imagine order related right the that was the actually reserve the it with of other was pie starting as in peak more from our peak dropping first of industry there Afghanistan is some first support. with investment risks mitigated Florida, required of in closures, that contributed kind of over. here during the and season what cetera. against piece the we government to where of the consciously might

getting are We compensated for that.

outside any couple material of expect in both steady equitation. potential changes more to turn that's we again That's But move sensible in Everything be that that a of short-to-medium seems -- to quarters. overnight. else, there sides pretty not will invested it while term very next fluctuations a we around be balances inventory price don't investment. of and some for for So going the was

Michael Kasbar

opportunity bit add into because that crude returns. within it our fuel. and as and then to a take oil inventory up marketplace for we through oil me inventory We to [well] sort others look in three of of cycles ratable we've coming as with commodity distribution the with a And as asset a in base And the just more evolution value network current as we're you've more an and underwriter evolution I'll about creating gone market at light maker now before. out went service little color the started and heard talk

is four we is third there the So party, which our from. came methods and where have sale, we of

our breaks as virtual what customers' then into which And four were physical call distribution basically have we inventory We and as we down demand. ways have those well XPV assets. the I that satisfied

inventory So if its had put there -- inventory no aviation interest many would on manufacturers, locations the because we There jet fuel into strategic no we some supplying to were be in have side have didn't in supply. wings. it

and that. particular to So e-commerce developing in expand there model, XX peculiarity we And drive our business and our business But you a it's tough The countries well states. it's of courtesy the penetrate for XX of XX supply will reason we of a same to choice then bit worked Today fuel capability to business And in that's in markets is pretty multiservice that evaluating. we terms our its And third-party of chain have now the and we in some niche in [rack] app inventory Marine again land assets distribution card terms started and ability us of cards in continue for and have and there. out strategic inventory. then if in In markets. got we countries. there.

end dollars more us types customers We for create but creating investments our robotics procure the end and eliminating using for are those to internal touch operation. putting processes, integrate more making as to manual zero with some then our fuel of efficiencies into of internal also and to basically convenience completely investments to

I So model and the of how out an inventory the allocation bit optimizing opportunity business that. long we are just thought the little and to returns way looking but at current was away a from and lay that

of some to driving create with and is going lower So consolidating I that us and areas, going service better team are at to looking for at Jeff systems think additional those cloud-based Smith cost. standardized derive accounting his opportunities

So, anyway.

Sorry share it thought to worth but to -- that. was I inventory

Ben Nolan

to that so Thanks honestly is appreciate -- kind I think of very at relates guys. was it inventory what it. certainly I company there on was as the I strategy how level, the helpful. driving a where was holistic

Operator

Our next with Ken line Hoexter comes of question from Merrill the Lynch.

Your open. Please line proceed your with question. is

Ken Hoexter

you it's Michael to rationalization very to and the were Glenn off volumes what on? at things Ira things, on walk a off want down the kind you and of lot a going out talking part touch, Michael seemed I the I you land in hit the to year-on-year? the understand it's down, distributing that now understood, model, selling you volumes maybe lot talk through just Maybe Michael, because want maybe working if gas just mean on. be, stations business business bit, just, web, what different if since mentioned about than what's you Ira about a just to you your to threw know some is you I presentation don't talk were rationalizing different of the doing zero some can of also land assets? came it you the robotics, Maybe of those different that of order but you're I I beginning you're me owning web, stuff me through land guess a from threw fuel than wholesale

Michael Kasbar

predominantly are UK the and we So, the U.S., in Brazil.

of global it we've business intention global methods is that aforementioned the to our to in got because do Although ability the and fulfillment. go a is

orientation in game, and then we world, So out planes up of to a orientation. start the global we company, go us doing by you the our globally, that over you're if grew business and Many going internationally. with ships global have started so play

global, reason no absolutely be there's land our with should that. So just start want business out why so to

the We in that still retail a truckloads amount We so XXXX a full that, went by good that de was business. like space interesting that in the it. experience. an contracts. under Midwest, business supplying and good in have to fuel XXXX stations of entered to we multiyear gas We that was So, aggregated novo, it's

decided a little chunky to me move we rack let amount of and great and built bit. up the started the Midwest. such reason we We out and aviation we the for we XXXX got unbranded recently our businesses into into to That a of We and derivatives wholesale XXXX wasn't interesting, business -- certain sort against Western distributors were some that's backtrack pricing the business some that strategy, expertise acquired we XXXX of to business and were branded C&I, So distribution diversified XXXX U.S. because looking the XXXX Western retail piece in Western had FBO. business, in a into consolidating in was in credit three was which C&I concentration we've -- went a was in the the all we of we that. sorry, rather and

"land the with about art lasted. X,XXX as business a state distribute was today to as also South crude a oil roots. using business to real and under So of that's that our going FBOs North where contract oil the we it built crude well thread while on terminal Told shipping entrepreneurial are inventory," great we they had in Canada we

we as well business everybody made involved and are lubricants. 'XX diversified We money, and QX have got market knows. was changed. the issues crash of there but and a extremely a of QX, exported kind all there good we 'XX and the stock Western market these of a amount lot Of of and it of in other course,

So more unwinding. to we those which of now are aggressively had many unwind we things

trimming now take more return we to business eliminating to and business those working our freeing in constrained deploy higher core and to portfolio, and much while focused capital that unwind on of that Some activity. aggressively are a highly the up reallocate the

our It's still business. So a have retail business. a that We we good within business business. land like

the hit We have Pepco}. our of the little got and with of transition with the in terms know, terms a market well Pepco that acquisitions changing. bit you East in supply Coast C&I [AP&P business

our we activities mentioned good business to selling of more more So amount as the and I've are past more that the and in getting revenue restructuring recurring be retail. selling selling side. A are aggressive on cross

connect to in business good Our crossover, prepared a my where a made and that common customers. has I its business gas comment remarks,

go we interesting to have do C&I So customers. an those common after ability now

business business, better So our UK team hell got today lot changed is operating which a there. the U.S., today, we've it's C&I in our of the we've retail a business, management entire

our these some what with big an I there for Ira? within activities have is those are forgotten, and We aggressively Brazil businesses, we're these and a rationalizing a the is have so market. supermarket, are most there to all need always ups and you your of activities. got you do business thing portfolio know to different story, that's Now validating smaller venture that that of is it's land part, decide one the interesting items your that the and downs of when Brazil. -- more But

Ira Birns

I it. of think all you covered have

Michael Kasbar

if… Ken I don't know

Ken Hoexter

[indiscernible]. wrap it up, So just was to that I mean

Michael Kasbar

about I'm inventory sorry, let just me land. within side the tell you

and as much Arabs is where it just not you as have market the it's are to. was robust, -- fairly as We the and just changed that at giving looking used that not

maintain and the we what So in will distribution to continue and needs. because market expertise inventory derivatives that's

done. got really but basically whatever to Obviously it required. with it's when you needs approach to amount market market get be the less we better of operation up and we capital working whatever setting return is So deployed

question. to have another I Sorry can interrupt,

Ken Hoexter

simplify just the was at there. trying guess, end I I to

don't overview? different even trying is I'm why your like on know some down? to or to as was then the fuel back what based and to again doing it in broad of gas type with that mean of the the like the sounded some it staying that. parts it I in stations things operation while going to ordering just in of retail come kind is that many going simplify -- you to through So Does just are there simply and I want rationalize app back to so down a land story for distributing branded

Michael Kasbar

No, no, question. a was it no, great

got So have retail we C&I. have we

businesses. If at of is a in lot commonality you our there this look

So gas now go from we to truckloads full a retail look station. if for to businesses you at terminal from our a are rack ranging

FBO our different. have business We which a is not lot

We rack are from to or an refinery go to internal of jet fuel truck ranging a FBO. full a

lot So commonality. there of is

the at and there C&I we commonality their as between are there customer as power. looking is our fuel serving of gas well business lot a As that liquid

delivering is across its these in and logistics businesses all there its where So it. fuel commonality procuring a them

company, With user the our ordering fuel. gasoline about be fuel. C&I its customer. that of talked any a app is industrial that commercial and could They want when laundromat, people diesel be of aggregate could or truck And a I

in the and them on and manage energy their convenience demand society to provide now you for have to that operations. their basically have So economy got we

where our the complete in now internal that's is our are customers' that world and deploying we requirements. operations going are systems our with So technology connecting

when want So that they it, where their they fuel it, able to want are they buy it. they want how

I name and that So business. game that's that's integrating are within clear. our of we hope all of the the

Ken Hoexter

Let just ask one me quarter. last question from

of in would that Is this Is hedging earlier forward quarter. is mentioned rolling Ira gains go the it's or the the different still there into recognize that rest quarter. I anything something maybe or for over results 'XX? in for anything left not that that had You think you there things over on quarterly does something

Ira Birns

the million question, so we or the fourth are for had in the the then it and that took we hedge on we first on in equation you quarter. the quarter hedge a talked thanks where inventory about $X yes, of physical side the is a what think gain referring Ken, I sold the

us that's now. So generally came but during back all that behind $X January million

Operator

next from Seaport line question Our Kevin of with Global comes Sterling the Securities.

your open. is Please question. proceed line with Your

Kevin Sterling

us in about we as three for rest we as the lot had the how got us of the give about we you from we you're some to your had any you there just had year nice kind the new of moving rebound color of help QX. Michael rest segments parts? moving quarter, think volume a Can this have thinking growth guys because year -- have of parts some

Michael Kasbar

lot all time there Obviously, you a parts. a looking together, more on cost the is of spending lot thing put at as the of is Well we've all that moving structure these been metrics.

comprised OpEx. So margin and is obviously our model of volume

focused been we've a of we where all at -- have of been is lot lately, about as we thinking on. that a lot look this So the

I systems So things. to our but of got get we've terms lot focused shot our a financial or more the our being this to and five fewer portfolio, inorganic. of organic years come we've able I the restructuring some to about to years five our do, got next we resources over have the if some got CAGR think to of year, a on fruition That to and XX% ability work three drive people over think of in plans we feel our three like both

to don't to know -- build certainly the that sales. able system have I a we cross as to everybody sounds mentioned our if that for aggressively but I hunt do of and we some got in deploying that have terms So should we the like be in up platform, that that past are as ability we now technology [lay] that we should but sales global and machine that's think that business.

differentiated. at you is and we a we at with customer we we and got look connectivity got as and more within have and list products it's as We we feel the both something have look organization acquire our role I that. services customer that have. fairly create the that base if and mean We that companies extraordinary incredible

We to right our we've win. it, a it. feel of all global back It's you there with if a good demand that we're better. that we're our I got looking existing forward think space, services, a customers cross is whole that and our to a I getting about part We capability mousetrap know of where this reference lot white place execute of products have strong that so to working customers and marketplace got in building, exciting the lot an lot getting within to

and but think that's reasonable over five look both we transition next three a that to years So the inorganic. CAGR XX% at it's been organic a to

Ira Birns

I Just why volume to your part question not of for this the briefly first year reasons of made grow that we the to is to add Kevin expect part Mike principal think to this, the looking one business part where of the aren't of looking we've of purpose. we're to -- lower entire been for doing through business, lots that on performing and actually and got --[checks we've well, businesses the uncovering where now] margin that

a of we XX% we be we we see story As without nice the quarter year it's XXXX, of I this a with from should in much a to you could grow declines 'XX, we're our bit profitability of lot little volume believe was able with a think that's had year-over-year M&A get but through problem. volume once stronger, -- of maybe a so point,

Kevin Sterling

No okay gotcha.

you're You mentioned or the since us there does is kind pipeline, did M&A on looking at the verticals maybe work, M&A you don't update mention mind? maybe new if you how any pipeline of like

Ira Birns

make in and of valuations opportunity how there, pipeline. Its There lot continue in out bit. sure not play could into is which sense, as opportunities identifying portfolio, our as a might shop sense, to a of our certainly which make plug the opportunities we're refine business it we we current

take So more looking as -- in the is like of example. land core at with an lot activities our term short we're in businesses line a

of there game in So years. going jump the we think but of of the been the an for and our us too lines into to almost provide out all Right, again. stronger levels for new use of of word back making that sometimes there, past are is two can overly a haven't help sake we very bit as and much to acquisitive synergies to is through acquisition the you to we kind year, to carefully opportunity acquisition is digest I think but really business tell, we're rather going But existing getting not add some value drive cautious core one an growth. deals we doing make but really

Kevin Sterling

follow-up don't last you mind. one here And if

customers prices the side of oil by seen the with rise few And of kind the curious maybe you customer steady just on that the little are this in some what those years I'm ago. -- the change, improving feeling compared your optimistic the with current Marine are rise your we your that prices environment, your of in? buying behavior feeling buying a they Marine lines are seeing of or a are are patterns in the about have now like bit bit rise oil seeing environment customers kind prices? is along Marine more to customers, you this they With in is operate in environment oil rise terms patterns to better of that little a

Michael Kasbar

Kevin market. there lot don't to the is I think a within celebrate

I bit think, this of is a still a slog.

recent think But maybe am some there's sorted for. she has in is supply You product has Container as I I anything noticeable its goes. I period. expectations the is anything from but supply the include, bit. the changed bit to of think what the I don't don't little themselves not a or obviously, that particularly is of hard but out trade tanker is celebrate have to production, that it's got I -- in think there has a tell. modern scenario steady think activity got side [drive] both terms But what certainly,

Ira Birns

in the that range I second are we're to some That There as buying forecasting have at that. the markets believe down is are that or activity be seen certainly remains just moderate but ready not We your there. you to seen. results. handle side the less On still our question change. more answer to

not forecasting our that in So -- structuring we're costs. how and we're

areas. thing the us that a business probably and [worthy]. was the are we're in think to And should opportunities looking dealing I company, our significant recurring to really amount those is at to structuring about make and of comments, they profit such within may high folks in hear more we're the it revenue margin flow the present themselves these I next past, opportunity that important that So made want

So think committed business superior our have provisioning we we business, the good forecasting Marine But land and great natural a not to We comment our got those, we continuing we very that's have are and clientele increase a service LNG. we any our have. sense. makes using and technology think of select there we've in I industry. the business it aviation done with we think have provide organization. our a robust within a mousetrap which for good got terms penetrating important as We got We to and more chain maybe but synergy Marine Marine, gas and it's supply think a also just are between

Operator

over call the I for you Mr. Kasbar at closing back this time, to would to like turn remarks.

Michael Kasbar

to listen take everybody. quarter's to you for talking And thanks this quarter. have the taking and care, well again Thanks we your good forward time Okay, look a support to to Appreciate you results. next evening.

Operator

today. conclude Ladies and conference does call for the gentlemen that

World Kinect (WKC) 26 Apr 182018 Q1 Earnings call transcript