Unexpected volatility in the foreign currency exchange rate caused WEX Inc. to experience lower-than-anticipated net income in the fourth quarter, although the company still turned a profit, the South Portland-based payment processing firm reported Monday.

The company’s adjusted net income for the fourth quarter decreased 18 percent to $37.2 million, or $0.96 per share, from $45.7 million, or $1.17 per share, for the same period a year earlier. The net income results include the impact of a non-operating expense of $8.1 million related to a net foreign exchange loss for WEX, which maintains accounts in 17 different currencies because of its extensive international operations.

“Abnormally volatile foreign exchange rates hurt the company,” WEX President and CEO Melissa Smith said in an interview Monday, adding that the company is reducing its foreign currency holdings and investing in hedges to offset the impact of such losses in the future.

Excluding losses related to the exchange rate, WEX had net income of $47.9 million for the quarter, or $1.23 per share, which was in line with analyst expectations.

Total revenue for the fourth quarter increased 16 percent to $211.9 million from $182.3 million for the fourth quarter of 2013, the company reported.

WEX, which provides payment-processing services to companies, grew its overseas operations significantly in 2014 through acquisitions.

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In December, the company completed its acquisition of a controlling share in ExxonMobil’s European Esso Card fuel card program for $60 million. The deal, first announced in November 2013, gives WEX a 75 percent ownership stake. The acquisition is expected to add $35 million to the company’s annual revenue.

Smith has said that the Esso Card deal is part of a broader strategy to expand further into overseas markets.

In July, WEX said it had signed an agreement with Shell Oil Inc. to process prepaid fuel card transactions for its commercial fleet operations in Europe and Asia. It also completed the acquisition of Evolution1, a cloud-based technology and payment solutions firm in the health care industry. The $532.5 million deal was WEX’s largest purchase to date.

On Monday, Smith said the company is in the process of opening an office in Singapore to grow and service its customer base in Asian markets.

WEX, which trades on the New York Stock Exchange under the symbol WEX, has about 700 employees in South Portland out of roughly 1,800 globally.

The company’s stock price closed Monday at $99.50 per share, up $1.41 from Friday’s close.


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