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.