World Kinect Corporation Q4 FY2025 earnings call

• Ira Birns introduced himself as new CEO, emphasized company's strong foundation and opportunities ahead, welcomed new CFO Mike Tejada and President John Rau. - Discussed portfolio reshaping, including acquisition of Universal Weather and Aviation's Trip Support Services business in Aviation, and actions to reshape Land segment by exiting noncore and underperforming businesses, entering into agreement to sell tank wagon delivery and lubricants businesses, and fully outsourcing transportation requirements. - Mentioned progress in optimizing portfolio, simplifying business model, and focusing on core businesses for sustainable growth.

Aviation: Fourth quarter aviation volumes were 1.8 billion gallons, down 5% year-over-year. Fourth quarter aviation gross profit increased ~8% year-over-year to $130 million, driven by Universal Trip Support acquisition. Full year aviation volume was 7.1 billion gallons, modestly lower than prior year. Full year aviation gross profit totaled $526 million, up 8% year-over-year. Land: Fourth quarter land volumes declined 9% year-over-year. Fourth quarter land gross profit was $71 million, down 32% year-over-year. Full year land volumes totaled 5.6 billion gallons, down 8%. Full year land gross profit was $298 million, down 22%. Marine: Fourth quarter volumes were approximately 4.1 million metric tons, flat year-over-year. Fourth quarter marine gross profit increased 2% year-over-year to $35 million. Full year volumes declined 5%. Full year marine gross profit declined 21%.

• For 2026, transitioning to provide full year adjusted EPS guidance, expecting 2026 adjusted EPS to be in the range of $2.20 to $2.40. - Expect first quarter aviation gross profit to be up year-over-year, driven by Trip Support acquisition and international organic growth. - Expect first quarter consolidated gross profit to be down versus prior year and sequentially, driven by land exit activity. - Expect first quarter operating expenses to be down versus prior year and sequentially when adjusted for residual land exit-related activity, partially offset by incremental operating expenses from Universal Trip Support acquisition.

Q: Ira, Mike and John, welcome to everybody to new positions and great to hear the move to simplify the business and provide the clarity. So Ira, maybe just start off with -- you've made an acquisition here on Universal Trip. Maybe talk about scale of revenues, op income volumes for that. And then also on the sale of the tank wagon business, maybe talk to us about the impact we should expect on volumes, revenues or what have you as we move into the second half?

A: Ira Birns mentioned Universal is a service business with approximate gross profit of about $70 million, with year-over-year impact in 2026. Mike Tejada said shedding about 1 billion gallons worth of volume between exits, receiving about $100 million from Diesel Direct transaction.

Q: Ken Hoexter asked about changing to just annual guidance, staying away from quarterly, and seasonality.

A: Mike Tejada said seasonality in land fell away with U.K. land sale, main seasonality now related to aviation. Ira Birns added about natural gas seasonality and aviation seasonality.

Q: Ken Hoexter asked to expand on the impact of owning and managing the fuel yourself, but partnering with independent operators who run the convenience stores, and competitive pressure in aviation.

A: Ira Birns detailed the hybrid model in C-store space, which is a good cash flow model. On aviation, said competitive pressure may be temporarily new normal, with team looking for opportunities to expand airport locations.

Q: Ken Hoexter asked about marine business rebound.

A: Ira Birns said marine business is stable, with biggest macro factors being price and volatility, still in lower historical price range, not expecting material change in 2026.