FREE SUBSCRIPTION Includes: The Advisor Daily eBlast + Exclusive Content + Professional Network Membership: JOIN NOW LOGIN
Skip Navigation LinksHome / News / Read News


Element Reports Resilient Second Quarter Results

July 29, 2020, 07:10 AM
Filed Under: Corporate Earnings

Element Fleet Management announced  financial  results for the second quarter ended June 30, 2020 and continued progress on its strategic priorities. Editor's note: Amounts in $CAD unless otherwise noted.

Element’s market-leading platform generated adjusted operating income of $111 million in Q2 – the Company’s first full quarter of business amid COVID-19. This represents a $0.02 per share decline from Q2 2019, reflecting shelter-in-place edicts reducing clients’ vehicle activity levels, delayed originations  due to OEM facility closures and declining syndication revenue yield. 

The Company reported Q2 2020 net income of $58.6 million. According to the Company, Element’s strong results in this environment provide numerous proof points of the Company’s resilient earnings power. For example:

  • Servicing income decreased just 8% year-over-year and 9% quarter-over-quarter amid a global pandemic,
  • The Company generated free cash flow of $0.25 on a per share basis –32% higher than its adjusted operating income of $0.19 per share,
  • The Company won new business – including self-managed fleets – and renewed and retained large existing clients in the second quarter, and 
  • Credit performance remained robust with receivables collection strong, client requests for deferrals having essentially come to an end,  no  change in the balance sheet allowance for credit losses and a  decline in delinquencies in the quarter.

In addition, notwithstanding COVID-19, Element’s transformation program delivered $30 million of operating income enhancement in the quarter.

“Element achieved a host of significant milestones in the second quarter, delivering on our strategic priorities while generating durable earnings and cash flow in spite of COVID-19,” said Jay Forbes, President and Chief Executive Officer. “I’m extremely proud of our people,  whose hard work underlies  these solid results and who have been delivering a consistent, superior client experience in trying conditions for months. That effort will continue to pay off: our learnings this quarter increase our confidence that Element’s resilient business model, transformed platform and strengthened  balance  sheet  make  us  the  best-prepared  company  in  our  industry  to  emerge  from  this  period  with momentum.”

To read the full release, click here.

Comments From Our Members

You must be an Equipment Finance Advisor member to post comments. Login or Join Now.