Element Reports Record Quarterly Results for Q2 2025

Executive Summary

• Element Fleet Management Corp. reported Q2 2025 financial results, highlighting a 6% year-over-year increase in net revenues to $290 million and an adjusted diluted EPS of $0.30, up 7% year-over-year.
• The company demonstrated strong operating leverage, with adjusted operating margins expanding 100 basis points to 55.8% despite unfavorable foreign currency translation impacts of $10 million.
• Management expects to end full-year 2025 at or above the high-end of guidance ranges for all metrics except originations, driven by a robust global committed order pipeline of $1.7 billion.

Key Details

• Net Revenue: $290.0 million (Q2 2025), up 6% year-over-year and 5% quarter-over-quarter.
• Adjusted Operating Income (AOI): $161.9 million, up 6% year-over-year and 7% quarter-over-quarter.
• Adjusted Operating Margin: 55.8%, an expansion of 10 basis points year-over-year and 110 basis points quarter-over-quarter.
• Adjusted EPS (Diluted): $0.30, up 7% year-over-year and 8% quarter-over-quarter.
• Adjusted Free Cash Flow per Share (Diluted): $0.40, up 8% year-over-year and 11% quarter-over-quarter.
• Return on Equity (Adjusted): 17.5%, up from 16.3% in Q2 2024.
• Originations: $1.9 billion in Q2 2025, a 4% decrease year-over-year (excluding FX) but a 26% increase quarter-over-quarter.
• Order Pipeline: Global committed order pipeline ended June at $1.7 billion.
• Vehicles Under Management: 1.512 million at June 30, 2025.
• Syndication Volume: $537 million in Q2 2025, down 44% year-over-year. Syndication revenue was $12 million, consistent with Q2 2024.
• Share Repurchases: Repurchased 3.1 million common shares in the first six months of 2025 for approximately $64 million under the normal course issuer bid (NCIB).
• Dividends: Declared a quarterly cash dividend of CAD$0.13 per common share for Q3 2025, payable October 15, 2025.
• Debt-to-Capital Ratio: 76.1% at June 30, 2025 (target range 73%-77%).
• Revenue Breakdown:
  • Services Revenue: $151 million (up 8% YoY).
  • Net Financing Revenue: $127 million (up 4% YoY).
• FX Impact: Unfavorable translation impact reduced net revenue by $10 million (Mexican Peso -13%, Australian Dollar -3%).

Notable Quotes

• "Our performance is a reflection of the strength and resilience of our business model," said Laura Dottori-Attanasio, Chief Executive Officer. "We are committed to delivering excellence to our clients and partners while navigating through evolving economic conditions."
• "Looking ahead, we are focused on accelerating our platform automation, driving new opportunities for growth in our business, and creating long-term value for all Element stakeholders."