Greetings, and welcome to the FLEETCOR Technologies First Quarter 2020 Earnings Conference Call. As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host, Mr. Jim Eglseder, Head of Investor Relations for FLEETCOR Technologies. Thank you. You may begin.

Good afternoon, everyone, and thank you for joining us today for our first quarter 2020 earnings call. With me today are Ron Clarke, our Chairman and CEO; and Eric Dey, our CFO. Following comments from both Ron and Eric, the operator will announce your opportunity to get into the queue for the Q&A session. It is only then that the queue will open for questions. Please note, our earnings release and supplement can be found under the Investor Relations section of our website, fleetcor.com. Throughout this call, we will be presenting non-GAAP financial information, including adjusted revenues, adjusted net income, and adjusted net income per diluted share. This information is not calculated in accordance with GAAP and may be calculated differently than non-GAAP information at other companies. Reconciliations of historical non-GAAP financial information to the most directly comparable GAAP information appear in today's press release and on our website as previously described. Now before we begin our formal remarks, I need to remind everybody that part of our discussion today will include forward-looking statements. This includes forward-looking statements about new products and fee initiatives and expectations regarding business development and acquisitions. They are not guarantees of future performance, and therefore, you should not put undue reliance upon them. These results are subject to numerous risks and uncertainties, which could cause actual results to differ materially from what we expect. Some of those risks are mentioned in today's press release on Form 8-K and on our annual report on Form 10-K filed with the Securities and Exchange Commission. These documents are available on our website and at www.sec.gov. With that out of the way, I would like to turn the call over to Ron Clarke, our Chairman and CEO. Ron?

Good afternoon, everyone, and thanks for joining our first quarter earnings call. I plan to cover four subjects at the opening here: first, I'll comment on COVID and our response to the crisis; second, I'll share my perspective on Q1 results; third, I'll speak to the trends that we're seeing in our businesses in April; and lastly, I'll cover our framework for resetting priorities in the company. Okay. Let me begin with some remarks about the COVID situation and what we're doing in response. So like many companies, we've taken a number of actions over the last couple of months. Safety. So, first, to ensure the safety of our 8,000-plus worldwide employees, we quickly transitioned the majority of our employees to work from home. I'd say that we're working our way through the new work-from-home model, trying to establish a new cadence for running the company, more teleconferences, more Zoom, more general employee communications, really re-evaluating people's priorities. Second thing, we focused on business continuity to assure our systems and payment products continue to work through this period. I'm pleased to report that in Q1, we delivered the highest system uptime and fewest client incidents in quite some time. So good news there. Third, we focused on and shored up our liquidity. We consolidated cash. We raised a bridge loan and we've taken our liquidity to about $1.5 billion. And lastly, credit. We've tightened credit lines and payment terms. We've shut down inactive lines, reduced unused line capacity, selectively reduced payment terms for distressed clients or industries, and we've repurposed staff to step up our collections intensity. So in this initial response phase, we've had some success managing the situation and learning how to operate within it. Okay. Let me shift gears and talk a bit about our Q1 results. So we reported Q1 revenue of $661 million, up 6%, and cash EPS of $3, up 12%. Our Q1 revenue finished about $10 million lower than our expectations as our businesses began to contract in the second half of March when the shelter-in-place orders took effect. January revenue grew 8%, February revenue, 8%, and our March revenue, 3%, leading to overall revenue growth of 6% for the quarter. In terms of organic revenue growth or what we call like-for-like revenue growth, Q1 finished at 5% overall. Inside of that, fuel came in at 2%; corporate pay, quite good at 20%; toll at 10%; and lodging at 5%. All of our businesses were impacted by the sudden volume declines in late March, bringing our growth rates for the quarter below target. Despite slightly softer revenue in the quarter, our profits actually came in at the high end of our expectations, helped there by a lower tax rate and fewer outstanding shares. Our operating trends in Q1 were also affected by COVID. Our same-store sales declined 2%, again related predominantly to the late March softening. Our new sales grew 2% versus last year. Again, the market began to get distracted in late March. But thankfully, our client retention remains stable at 91%. So look, given everything, a pretty good financial print for Q1. A good start in January and February helped us hold on to the Q1 performance. Okay. Let me make a turn to the trends we're seeing in April and run through each of our businesses and the COVID impact on each. So first up is fuel. So here in North America, our fuel volumes are 20% to 25% behind last year in April. Our trucking business is holding up a bit better than our local. Because many of our North America fuel businesses are essential services, it looks like our volume declines are leveling off. Our North America fuel revenue will be helped quite a bit by spreads in April as the fuel margins remain very wide. In our international fuel card business, volume is weaker than it is here; business is down 25% to 50% depending on the particular market, mostly because the Europe shutdown was earlier than here in the U.S. and also because in the U.K., in particular, there's a greater proportion of white-collar cardholders who have been more impacted by shelter-in-place orders. Generally, we expect both North America and international fuel revenue in April to be a bit better than the volumes, and that's because fuel revenues, or fees, some of them are fixed in nature, think card fees, which tends to have revenue be a bit better than volume. Okay, next up, corporate pay. So in corporate pay, our virtual card volumes are off about 20% in April versus prior year. Again, we're expecting probably volumes to level off there as lots of our client accounts payable is fixed. Some good news with our full-service, full accounts payable automation and outsourcing business, which we expect to be up in April. The remote capability, the ability to process accounts payable outside of the office, is resonating. And our cross-border business is continuing to hold up and grow a bit in April, mostly due to the ongoing currency volatility. We did take an extraordinary loss—a credit loss—in the cross-border business, which Eric will cover in some detail in his remarks. Turning to our lodging business. We expect our core workforce business to be down about 25% versus prior year in April. Our rail, truckers, and construction workers continue to need rooms even in this environment. And just as a reminder, most of our workforce lodging travelers drive to their hotels; they don't fly to their hotels. Our new Travelliance airline or crew lodging business will be way down in April, somewhere in the 75%-plus range, as airlines canceled most of their flights, fortunately, a much, much smaller part of our lodging business. Brazil. Brazil toll is a bright spot for us. So despite toll transactions being down in April, we expect toll revenue to be roughly flat or even slightly up, and that's primarily because toll revenues are subscription-based. Lastly, our gift card business is expected to be down about 50% in April as many of our brick-and-mortar retail clients are temporarily closed, moving much of the activity in that business to digital redemption. So a few conclusions here. Our April volume and revenue impacts vary quite a bit by business. Some of our business are not impacted much, some impacted in the down 25% range, and some impacted down to the 50% or 50%-plus range. Fortunately, the businesses most affected, most impacted by COVID represent a smaller proportion of our overall business. We do expect April revenue to come in 20% to 25% behind the prior year. We do expect volumes to begin to flatten. We see it sequentially as we look through April. And because many of our cardholders are essential workers, first responders, healthcare workers, truckers, rail, and construction, they keep right on doing what they do. Also important, most of our volume decline thus far is client softness, not client loss. So good news that it could come back on the other side. And lastly, we're a 50% EBITDA business, so we can continue to make money and generate cash even at these distressed levels of volume. Okay, let me transition now to the company's priorities and how we're framing things. So we've basically looked at a reset here of priorities based on the changing environment. So Phase 1, the response phase, which I outlined earlier. We've taken four actions already: safety, business continuity, liquidity, and credit initially here to respond to the situation. And again, I think we've had decent success and report we're well underway here. Phase 2, the shutdown phase, the place we're at now, where volumes are down and all of us are learning new behaviors. The priorities in this phase are expenses. So we're working to get our expenses down and better aligned to current volumes. We're cutting where we can, where it makes sense, but protecting, particularly the selling system and technology capabilities that we'll need when we come out the other side. Selling, we're changing—modifying how we sell, targeting different prospects, surge industries, moving almost exclusively to digital contact, repositioning our message. So lots of work to progress selling. Projects. We're reevaluating our project work, pushing projects that we can control and it makes sense while delaying other projects that rely on others to a different day. And then lastly, we look forward to a future phase where businesses begin to reopen and things begin to recover. So the message here is we'll be ready. In that phase, the recovery phase, we'll plan to chase acquisitions that maybe, just maybe weren't there before. We also may get some benefit from COVID's new behaviors that we can take advantage of on the other side. So for example, the emphasis on touchless transactions, think electronic tolls versus cash, think distressed passenger mobile applications versus visiting gate agents, think payroll cards versus paper payroll checks. And then even remote working, think about our AP automation and outsourcing service to pay bills when you're outside of the office. So the hope is that we may be better positioned in some of our businesses when we get to the recovery side. So look, in closing, we've never been in a place like this before. We're continuing to operate the business and to serve our essential clients, many of which continue to work through the crisis. We're in the process of replanning things, our priorities, our expense levels, our project plans, our sales, and go-to-market approaches, in an effort to make the best of the situation. And like you, we're hopeful that the gradual reopening will bring our clients back, and that our business will return to at least some sense of normal as we progress through the year. But I can tell you, we will be ready. So with that, let me turn the call back over to Eric to provide some additional details on the quarter. Eric?

Thank you, Ron. I'll be going through my regular remarks for the first quarter results as quickly as I can to allow for some additional discussion about the second quarter expectations and your Q&A. For the first quarter of 2020, we reported revenue of $661.1 million, up 6% compared to $621.8 million in the first quarter of 2019. GAAP net income decreased 15% to $147.1 million from $172.1 million. And GAAP net income per diluted share decreased 14% to $1.67 from $1.93 in the first quarter of 2019. Included in the first quarter 2020 results was the impact of a $90.1 million or $0.74 per diluted share onetime loss related to a customer receivable in our foreign currency trading business. Due to the extraordinary impact of the COVID-19 pandemic, our Cambridge business experienced a very large one-off bad debt loss in the first quarter, resulting from a large client in the agricultural commodity space entering voluntary liquidation. The details are in the earnings supplement so I won't go through all of them again here. I'd remind you that approximately 30% of our Cambridge revenue comes from hedging, whereas approximately 70% comes from making international payments. I'd also note that Cambridge does not take FX risk. Our books and/or position are covered by back-to-back offsetting transactions with banks. This is a credit loss due to a customer's bankruptcy and inability to cover their accounts payable margin calls. While we do believe there is a chance of some recovery through the liquidation process, we have determined it appropriate to take a provision for the full bad debt loss of $90 million on the customer due to uncertainty of any future recovery. We view this as truly a one-off event as this business has experienced less than 1.5% bad debt loss as a percentage of revenue for as far back as we have data, including periods prior to our acquisition of Cambridge in the third quarter of 2017. Please see our earnings supplement for a detailed overview of this onetime loss. Also included in the first quarter of 2019 was the impact of a $15.7 million or $0.17 per diluted share impairment charge related to our minority investment in a telematics business. Excluding the impact of the onetime customer loss and impairment charge, net income increased 13%, and net income per diluted share increased 15% in the first quarter of 2020 versus the first quarter of 2019. Non-GAAP financial metrics that we will be discussing, our adjusted net income and adjusted net income per diluted share, and the reconciliation to GAAP numbers, is provided in Exhibit 1 of our press release. Adjusted net income for the first quarter of 2020 increased 11% to $264.5 million compared to $238.4 million in the same period last year. And adjusted net income per diluted share increased 12% to $3 compared to $2.67 in adjusted net income per diluted share in the first quarter of 2019. First quarter of 2020 results reflect a negative year-over-year impact from the macroeconomic environment of approximately $6 million in revenue. The negative macro was driven mostly by lower foreign exchange rates, specifically the Brazilian real and U.K. pound, when compared with the first quarter of 2019. We believe FX negatively impacted revenue by approximately $21 million. Fuel prices were down slightly year-over-year for the full quarter. Although we cannot precisely calculate the impact of these changes, we believe it was mostly neutral to the quarter. And finally, fuel spreads had about a $15 million favorable impact in the quarter. Now moving down the income statement. Excluding the impact of the onetime loss in our foreign currency trading business, total operating expenses were up 10% for the first quarter of 2020 to $370.1 million compared with $337.6 million in the first quarter of 2019. The increase was primarily due to acquisitions and bad debt expense. As a percentage of total revenues, operating expenses, excluding the onetime loss, were approximately 56% compared to 54.3% in the first quarter of 2019. Excluding the impact of a onetime customer loss, bad debt expense in the first quarter of 2020 was $27.7 million or 9 basis points compared to $22.2 million or 8 basis points in the first quarter of 2019. Included in the first quarter was a reserve of $10 million associated with expected additional credit losses around the world due to the impact of COVID-19. Depreciation and amortization expense decreased 4% to $64.5 million in the first quarter of 2020 from $67.4 million in the first quarter of 2019. The decrease was primarily due to the impact of foreign exchange rates. Interest expense decreased 9% to $35.7 million compared to $39.1 million in the first quarter of 2019. The decrease in interest expense was due primarily to decreases in LIBOR related to the unhedged portion of our debt, partially offset by the impact of additional borrowing for share buybacks. Our effective tax rate for the first quarter of 2020 was 14.6% compared to 24.9% for the first quarter of 2019. Excluding the onetime customer loss and the impact of the impairment charge in the first quarter of 2019, our effective tax rate was 18.9% for the first quarter of 2020 compared to 23.3% in the first quarter of 2019. The decrease in the effective tax rate was due primarily to additional compensation expense booked for tax purposes on stock option exercises. Now turning to the balance sheet. We ended the quarter with $1.55 billion in total cash. Approximately $482 million is restricted and consists primarily of customer deposits. We also have approximately $352 million of undrawn availability on our revolver and closed on a $250 million bridge loan in April in order to maximize the company's liquidity. So in total, we believe we have adequate liquidity to weather the COVID storm. As of March 31, 2020, we had $4.32 billion outstanding on our credit facilities and $819 million borrowed in our securitization facility. We purchased approximately 2 million shares in the first quarter for $530 million at an average price of $263. We have approximately $326 million in repurchase capacity remaining under our current authorization. As of March 31, 2020, our leverage ratio was 2.75x EBITDA, which is well below our covenant level of 4x EBITDA as calculated under our credit agreement. Finally, we spent approximately $18 million on CapEx during the first quarter of 2020. Now turning to the outlook for the second quarter and balance of the year. First, I want to remind everyone that although our businesses are very resilient, our businesses have all been impacted by COVID-19, some more than others. As a reminder, our business models are primarily recurring revenue in nature. We have a very broad customer base and diversified businesses across industries and geographies. Second, we are suspending our full year guidance. There is simply too much uncertainty regarding the resumption of business activity around the world to accurately predict what our volumes could be in the second quarter and rest of the year. Some revenue trending data for the first quarter in April is as follows. Revenues in January and February were tracking at or ahead of our expectations before the impact of COVID-19 in March. Through the first two months of the year, revenue was approximately 8% and 8% ahead of prior year, respectively. In March, our volumes were impacted mid-month. As a result, March revenue was only up approximately 3% versus prior year. And for the quarter, revenue was 6% ahead of prior year. Our expectations are for volumes to hit their respective floors in April and begin to recover gradually as the world starts to reopen. April revenue is expected to be down approximately 20% versus prior year. We expect that the second quarter will be the lowest in terms of volume and revenue. As the economy starts to recover, volumes should build throughout the year, resulting in higher revenue and earnings per share in the third and fourth quarters.

[Operator Instructions] We'll now take a question from Tien-Tsin Huang with JPMorgan.

I'll start by just asking on the expense outlook here and what you can control. What are you thinking about levers on the cost side that you might do here to protect the bottom line from some of the macro pressures you called out?

Tien-Tsin, it's Ron. I'd say we're probably a target of about 5%. And it would be on volume-related things, things that flex versus selling system or tech things. We'll probably also clip the capital plan a bit. But in our business, you can't save your way to profitability; our profits turn on revenues, and so we're going to be quite careful to not over-dial that.

Yes. No, I expect that. And then you mentioned M&A. With the world changing, valuations maybe open up the opportunity set a little bit, just your appetite, Ron, to do deals here. Are we in a wait-and-see mode? Or are you willing to pull the trigger on some deals?

I'm telling you, Tien-Tsin, I say never. We think -- I think this is a game-changer. You've heard our complaints ongoing the last few years about people in the space driving up prices and seller expectations and free money and stuff. I think lots of companies are hurt. Companies that have assets we're interested in are hurt. I think there'll be some impact obviously to valuations. I think people that compete with us for deals will have more thoughts on the credit side. So I'd say to you, probably it's high, that's a really long time, and we're spending lots of time on what I'll call kind of new deal thinking. There's five or six assets that we've coveted for some period of time that I personally think may have some chance of opening. So I would say high.

We'll now take our next question from Ryan Cary with Bank of America.

Just following up a little bit on Tien-Tsin's question. It sounds like most of your cost saves are more on the volume variable side rather than the investment side. So are you still planning on the step-up in sales and IT expenses you discussed last quarter? And I think you called out expectations from incremental IT spend in the $200-plus million range in 2020. Is that still on track?

Yes. Ryan, it's Ron. So that's right. We built sales plans to try to grow sales production, call it, circa 15%. We kind of grow sales expense at a little slower pace, call it, 10%-12%. So yes, we built the plan to do that. Some of it takes care of itself, right? If people don't reach the production goals, you get some of that money back in the form of lower commissions. I'd also say we pulled back on some kinds of marketing and lead generation, obviously, all the physical trade shows and stuff like that. But with that said, I think we're being super cautious on the headcount side. It takes a long time to build a really good field group and a really good telesales group. And so I think we're quite reluctant to reduce that and honestly, not to even refill or replace as we move through the year. So we're clearly trying to play the long game on selling.

Got it. And can you talk about some of the trends you saw in the toll business in the quarter? I was a little surprised the organic growth slowed to 10%. Was there anything particular worth calling out? And anything you can say about growth of new urban toll users in the quarter?

Yes. So first of all, I'd call it -- it's a really good result in this second half of March to still pencil that thing out of 10%. We're quite happy with it. But the reason it's not close to the mid-teens would be a couple of things. First, the transactions did soften, and we did get paid a bit on spend, particularly on the B2B side there. So COVID clipped a couple of points at the end. And then the other thing is the guy that leads that; they pushed to offer some free tags to build our tag volume at the end of the year to compete with the banks. And so we'll probably have another couple of percent of what I'll call free tags sitting in our Q1 results. So those would be kind of the two nicks on the number.

And anything you can say about the growth of new urban tolls in the quarter or just trends that you're seeing?

Can you say -- you broke up a bit, Ryan?

I apologize. Just anything around the new urban tag toll users in the quarter or any metrics around usage there.

In terms of urban tag sales usage?

Urban tags. Yes. I don't have that handy. I mean it's down. I think we targeted some kind of number, call it, 40,000 to 50,000 a quarter. I'll have to get back to you; I don't have any handy.

We'll now take our next question from Sanjay Sakhrani with KBW.

Appreciate all the disclosures, and I'm glad you guys are well. I guess the first question is on the comments on the second quarter being the weakest. Ron, you mentioned you have some defensive mix of businesses inside of your business. Can you just talk about how much of the volume is from these defensive areas versus the more cyclical stuff? And what gives you the confidence that we're going to inflect in the second quarter?

Yes. I mean I think the confidence comes from the sequential analysis, right? So we have a bit more texture than we set out. We've got daily reports. And I think from what we put in the supplement, it appears to us that virtually all of our businesses are planing, bottoming, if you will, at this point. And we've got another week, I think, of learning. We just had a big review yesterday. So I think -- what you guys haven't seen. So I'd say, if anything, we're starting actually to see a few of the business tick up a tiny bit. So the comment is our best guess is we're bottoming. And that we, Eric and I, think probably that May and June, it will be a smidge better than what we said in April. I quoted April around 20%-ish off of the prior year. So if, in fact, the tickup is happening, then clearly, Q3, if the world reopens, will be better. So our best guess is Q2 will be the worst.

Okay. And you also mentioned, Ron, like that the health of the portfolio is pretty strong given the defensive mix. Can you just talk about how do you feel about the general health? I mean do you feel that certain areas of your portfolio might be at risk if there's a prolonged economic downturn?

Yes. I mean I think we tried, Sanjay, with that chart to get into the haves and the have-nots. So I think like every business that you guys follow, some are affected none, some and a lot. And I think that's the same thing inside the FLEETCOR portfolio. And so we have businesses on that page that we think are the weakest and probably would have the longest trough. So for example, and again that page in front is what we called out our...

It's Page 10, Sanjay, in the earnings supplement.

So the couple -- look, the couple, Sanjay, that would be, I think, the softest, the longest would be the recent lodging airline acquisition we did that fundamentally relies on the planes flying and crew flying. So that thing's off, I don't know, 75% and it would be off for a while. And then the gift card business, to the extent that brick-and-mortar retail stays closed or some of those go BK, some of those go out of business, I'd say those couple of businesses, I think, will be weakest. But the other ones, I think if we've got one message today, again is, the impact is softness. So it's a fuel card client with 10 drivers driving 2/3 of what they used to drive versus he's fired 3 or 4 of those captains. So the ability for the thing to kind of come back, if the clients kind of come back, we come back. And so I'd say the rest of the businesses, obviously, we've got a few that are in the green, that are kind of happy days. And then we've got the rest that are kind of sitting there waiting for the clients to get healthy again. So I think other than a couple that I call out, that I'd say have a longer curve to kind of come back, the couple I called out, I think the rest should be on their way back because of the essential service nature of our workforce.

We'll now take our next question from Trevor Williams with Jefferies.

On corporate payments, I wanted to ask a few more on the sales side that Ron, you alluded to in your prepared remarks. Just with most people working remotely now, I'm wondering how that's impacted the selling process in that business. Because my assumption, and please correct me if I'm wrong, is that these are fairly long sales cycles and implementation periods. So as we think about you guys pre-booking a lot of next year's revenue growth in the prior year, just how much of that we should be expecting to come from new customers signed in 2020? Just -- and what the progress looks like there.

Yes, Trevor. You're totally right on current year. I think we've called out before that in the corporate pay business, particularly in the core virtual card business, most of the revenue from new accounts is sold the prior year, call it, somewhere 80% to 90%. So the revenue in 2020 is driven off of sales contracted but not implemented from '19. So on your second question, I'd say we're still finding our way, right? So this thing surprised all of us in March. We have a marketing and sales plan and closing plan, and it got changed, right? You can't have trade shows, and we're not visiting large accounts like we used to. So I'd say there's been a repositioning of how to sell, what marketing to do, how to contact people. And I'd say, if anything, the receptivity seems high, like people have taken the call, taken the appointments. What I think is still unclear is can we close, right? We'll call it 30 days into this, and some of these people have more time on their hands, or they're just being kinder in these times, but the contact rates are kind of okay. So I'd say probably in 60 days, we'll have a fix on whether sales can kind of be where we thought, just done in a different way, or whether sales are going to be softer. I'd say we just don't know yet.

Okay. No, that's really helpful. And then just on credit, Eric, I appreciate your comments in your prepared remarks. But I was just hoping to get some more color on how credits trended in April, maybe month-to-date. Whether that's either delinquencies or actual losses starting to come through more in earnest, just as we think about where we may need to expect losses to flex up to as we work through the trough in Q2? And then just wondering if you've seen any change in payment patterns after the PPP loans hit, especially with some of the smaller fleet customers?

Trevor, it's Ron. Let me take the first part and then I'll let Eric comment on the second part. I would say it's the most surprising thing to us so far, and surprising in a good way. So when this thing hit, you can imagine, we did a student body right to work on credit and liquidity collections. And so we've got a monitoring system that looks at trip-worthy, how rates people going delinquent, and then roll rates aging. And so I'd say that it's up, so we have benchmarked in all of our businesses. I'd say it's up but it's not up in any kind of meaningful way. So too early to call that, 'Hey, we've gotten through this between the stimulus money and stock. Hey, we're going to kind of be okay.' But if you said to me now, how did it look, say, this Phoenix thing? It looks pretty good.

Yes. And Trevor, just to add to that, this is Eric. Obviously, we take a look at the aging very closely and we track it week-to-week, obviously, exactly what the progress is in some of these aging buckets. And Ron indicated, we have been surprised that it really hasn't changed a whole lot. We've seen a little bit of tick-up in some of the aging buckets, particularly in the fuel category in the U.S., particularly in the SMB category, so it's a little worse. And we've seen a little bit of tick-up in Brazil as well, kind of a little worse. But again, nothing dramatic, nothing kind of to the magnitude that we thought it was going to be. We look at our AR balances a lot. I mean if you look at our AR balance at the end of the year, we had about $2.6 billion in AR, which moved to about 2 points -- I don't know, $2.1 billion, kind of at the end of March. And then at the end of April, we're down to about $1.8 billion. So the risk profile of the remaining AR is also getting better just because of the sheer amount of the outstanding AR that we have. So all in all, I think we're in pretty good shape. I think we were pretty conservative to take a bit of the reserve that we did at the end of the first quarter, and we're keeping a close eye on it. And we've changed a lot of practices, and we do some things -- done some things to collect some of our money sooner. So I think we're off to an okay place.

And let me just add, Trevor, one thing. We don't compete on terms like we compete with banks and other people. So we had policies for a long time in this company to compete on products and on the tech and on the convenience of the product. And so we have tons of daily, daily, tons of short terms weekly. In Europe, we have half of our book, I think, is insured. So we carve through; we have tons internationally on direct debit collect where we basically pull the money. And so in those cases, you've got trip rates in the 2% range, very, very small kinds of delinquency. So when we studied our old book again intently a month ago when this started, I think we feel pretty good structurally of how we've got the thing set up.

We'll now take our next question from Steven Wald with Morgan Stanley.

Maybe just on a high level, starting with corporate payments. Ron, you talked about never being higher in terms of watching for opportunities in the M&A side here. But if we start in corporate payments, and maybe you could expand this out to some of the other areas. Could you maybe talk about as you're looking at opportunities or as you're looking at your own offering today and watching the experience of this downturn and disruptions and what you can solve for, what sort of changed, or if it has changed at all, in terms of where you want to be in the landscape of the corporate payment's B2B opportunity since we caught up three months ago? And maybe if you could expand it out to the other areas. Are there any areas that you serve across your offerings that you maybe feel less inclined to be in actively or expanding?

No. It's a good question. I mean in the context of COVID and sheltering and the trends that we might expect over the next year or two, this payables or corporate payments business is a great place. And the reason is that lots of accounts payable, lots of the spend is fixed: think leases or IT contracts and stuff. And so bills have to get paid or services get turned off. And so I'd say, if anything, we'd like this corporate pay business for five years, and we've built a bunch of stuff and added to it and invested it. I'd say if anything, we like it even more. I think it's probably a little bit more defensive going forward versus the kind of the mobility stuff. Maybe mobility stays depressed a bit, whereas kind of accounts payable stays where it is. So I'd say, if anything, it probably elevates that segment even a notch higher for us.

Understood. Maybe just in terms of a quick follow-up; I was looking to your slide, I think Slide 8, you had talked about corporate payments growth bouncing back to 20%. But I think you also disclosed that you pulled the payroll card segment out of there, and that was the area that you called out last quarter with a sort of trouble from the prior disruption to services. What was the growth looking like ex those adjustments? I don't know if you restated that in the prior quarters or not.

Eric, do you know?

Yes. I'm looking for that. I don't know if we did a schedule on it. Yes. I know, Trevor, again, is the payroll card business was in the circa 30% down in volume for April. So if you stuck it on that chart to track the rest of the business, it would have brought it down some. And I think the 20% number is a revenue number. I don't have the payroll card revenue. But my guess, it's probably off in the 30% range.

Steven, I'll get back to you with what it was in the first quarter.

We'll now take our next question from Pete Christiansen with Citi.

And thanks for the great slide deck; fantastic job there. Ron, I was wondering -- I know FLEETCOR is a completely different company 10-plus years ago, but at least from the small fleet side, I was just wondering if you could share some of the experiences that you had back in the last downturn in terms of, I guess, attrition and perhaps credit on the small fleet side, I think that would be just -- that would be helpful.

Pete, this is Eric. Yes, if you go back to 2008 and '09, I mean to your point, we are a completely different company today than we were back in 2008 and '09. But I'll comment a little bit on the fuel business, which is mostly what we had back then. So when we were into that downturn, we did see volumes soften pretty significantly. So we saw same-store sales softness kind of in the mid-single digits, so it was pretty high. Bad debt, it kind of squeaked up a little bit. We kind of ran -- I don't remember the exact numbers, but probably the mid- to high teens from a basis point standpoint in bad debt back then. And then it escalated to probably in the 40, 45 basis point range at its peak in 2008 and '09. So volumes down kind of in the high single digits, bad debt still, call it, kind of doubled over that -- in the fuel card segment. That's the kind of the business that we have then.

Right. That's helpful. And then as I look at the gift card business, there's been a couple of high-profile retailers filing lately. Can you walk us through what happens if you have a partner that does that? Are there changes in like breakage or availability of funds? Anything of that would be helpful.

Yes, Pete, it's Ron. So mostly in our gift business, we don't take much credit risk because we don't really move money, right? We're really an accounting system, if you will, for retailers and a program manager. So the one place where there's credit risk in that is in card shipments. So if you're at Macy's or Dick's Sporting Goods and we -- you give us a card order, and we go to the card maker and take the stock and make it for you, put the Macy's logo on it and then send it to you, that would be the one place, right? If we ship it to you, whatever, March 15 and then -- so you have to pay us on March 31 and you don't. And so the good news on that is that our guy that runs that business, right, have chased all that stuff pretty hard when this thing hit. So right now, we have very, very little exposure, fortunately. And I put him on notice that we're not doing many of those kinds of things again. We're going to do a lot of card shipments to challenged retailers, at least not short-term. So I'd say we're probably in a pretty good place there.

We'll take our next question from Ramsey El-Assal with Barclays.

Ron, if you look across the business today, given everything that's going on, are you reassessing or thinking through where you'll invest in the future? Are there -- is this crisis kind of teaching any lessons in terms of changing priorities that you might have in terms of business investment? That could be product line, that could be geography. I know it's a very broad question. But do you feel sort of like it's just trying to hunker down with what we have today, and it will come out on the other end relatively intact? Or are there some more longer-term changes that you might kind of contemplate in terms of where you place your bets in the marketplace?

No. That's a really good question, Ramsey. I'd say, yes, I think like all of us on this call, we're processing what the future could be, what will the world look like in three months, six months. But for sure, I think there'll be changes. So on the portfolio side, I'd say we're super happy with the kind of the four categories that we've got: the three employee card things, fuel, lodging, and toll, and then obviously, we like the payable things. So there's nothing in the four businesses where we go, 'Oh, oh, I feel like I'm going to like those less.' As I said in some of my comments, I think some of those categories will actually be helped by this thing. My sense is that a lot of our changes are going to be on the functional side. And what I mean by that is our constructs and our policies around, like, credit. Our approaches around selling. Our approaches around part-time, full-time. I think we're going through all kinds of thinking now of, if this world stays this way or there's some things we've learned in this world that we might stick with even if the world goes back to the way it was, I think there's going to be a lot of -- I'd say, it's still early. If you ask me that question again in 90 days, I think we'll have a better answer. But for sure, there will be a bunch of stuff we do differently, for sure.

Okay. And I was wondering also, and forgive me if I missed this before, but could you parse out a little bit of the same-store sales performance? Just in terms of -- sometimes you can give us incremental color on underlying verticals within some of your businesses on the same-store sales kind of...

Yes. Eric will love to bring that, but I'll tell that obviously, the 2% drop was kind of all right in the last two weeks. So that means that dropped like a rock, obviously, given the April data that we've shown you. So I want to just prepare people that softness is what's taking our volume down. So you're going to hear a much different number in Q2. But you want to...

Yes. I mean just to give you a little color, Ramsey. What we saw was, as you can imagine, Ron indicated a lot of the softness that we saw happen in the last two, three weeks of the month of March. But fuel was a little bit soft, probably came in 3%, 4% soft overall, and lodging overall was a bit soft. But don't forget, that includes the TA business as well, that was kind of in the 4%, 5% range. I think it was offset by strength that we saw in our corporate payments business, which was actually up and also strength in our Brazil business, which was also up a little bit because of the clients that we have there and the additional products that we've added. So it's a bit of a mixed bag, but the softness was kind of where you would think it would be and the strength that kind of where you thought it would be as well.

And we'll take our next question from David Togut with Evercore ISI.

Ron, the high customer revenue retention historically of 91% to 92% has been a strength of the business. You closed the first quarter at 90.7%. As you look into Q2, which you've called as the likely trough, can you maintain customer revenue retention in the 90% to 92% range?

David, it's a good question. I'd say we don't know. I think it's going to be a function a bit of the help of clients, honestly, and what the casualty rate is and the bankruptcy rate among our client base. And so a lot of the retention aggregate number is a function of mix. We have businesses that have very different kinds of retention rates based on size, enterprise versus small, and then even type of business like payables growth, the spend growth of clients. So I don't know the answer. I guess it will probably be lower because we'll likely have more casualties in our client base where the businesses go out of business, which is already represent, and then credit. So again, if you simplistically said, 'Hey, we lose 9% or 10% of our revenue per year.' One-third or half of that is the business getting back, the business getting weak, the business closing, the business not having the creditworthiness to be a client. So yes, my guess is that's probably going to go up some in the quarter. Now again, once you get to that base, we get through this thing, that there's nothing structural that concerns me that would take us lower.

I see. Understood. Just as a quick final question, and I apologize if you addressed this earlier, but looking at capital allocation priorities. You bought back $530 million of stock in the first quarter so you're very active. You have $326 million left on the repurchase authorization. Will you be deploying cash towards share repurchases in this environment, possibly looking more at acquisitions? The seller expectations come down. Or will you be more in the mode of husbanding capital?

Yes. David, another good question. I'll let Eric comment, too. But I'd say we're in a preserve mode. We are -- I told the Board. We agreed with the Board. We are in a precaution. We want the maximum liquidity. We want a company that got all kinds of cushion until we see the other side of this and see the heartbeat on the other side. So we will not be buying back shares over the next quarter or two. On the other side, I think, on the deal side, like I said, if there's something unique that comes out of this, we might pull the trigger a little bit sooner than later. But I'd say we're probably in a bit of a hold pattern for a while.

And there are no further telephone questions at this time. I'd like to turn the conference back over to our presenters for any additional or closing remarks.

Guys, thanks for being on the call. Let us know if you have any additional questions, if you need anything else. Have a good night.

And once again, that does conclude today's presentation. We thank you all for your participation. You may now disconnect.