BRINKS CO Q3 FY2024 earnings call

• Total organic growth was 13% in the quarter. AMS and DRS grew 26% organically with double-digit growth in every regional segment. • CVM was up 9% organically with pricing execution offsetting market softness in global services, but hit by an 11% FX headwind. • Added Josh Teteak for Brink’s Business System efforts and Nader Antar as Global Leader of Brink’s Global Services. • In North America, technology and systems investments faced integration issues delaying productivity benefits, expected to ramp over next few quarters. • AMS delivered third consecutive quarter of accelerating organic growth with key wins, DRS continued to exceed expectations with backlog supporting fourth quarter, CVM had organic growth but affected by Global Services softness.

ATM managed services and digital retail solutions (AMS and DRS) grew 26% organically. Cash and valuables management (CVM) was up 9% organically. Adjusted EBITDA was $217 million, impacted by a $10 million increase in security losses. EBITDA margins were 18% in the quarter, down 80 basis points year-over-year. AMS and DRS contributed about 42% of the organic revenue growth of $156 million.

• 2024 revenue over $5 billion reflects ~$100 million currency headwinds. • Adjusted EBITDA expected $900-$920 million. • Free cash flow expected $320-$360 million with ~37% conversion from adjusted EBITDA at midpoint. • 2025 expected mid-single-digit organic growth excluding Argentina inflation, 100 basis points operating profit expansion, improving free cash flow conversion.

• Strong U.S. dollar caused 11% FX headwind, especially devaluation of Mexican peso. • North America routing system deployment had system integration issues delaying productivity. • Global Services business faced market softness. • $10 million security loss in the quarter due to timing issue.

Q: Please outline the relative impact of softer Global Services demand versus increase in AMS and DRS assumptions.

A: Global Services was a headwind, but still expected some growth; AMS and DRS organic growth better than expected with good backlog and wins.

Q: Do you think approaching near 50% long-term free cash conversion target could still be achievable in 2025?

A: Still think intact to eventually reach but no timing put on it.

Q: Should we think about today's FX move as incremental headwind versus 4Q revenue guidance?

A: Guide was based on rates at end of third quarter, which has gotten worse since then but wait to see where it lands.

Q: On AMS and DRS growth, is mid-teens or high-teens still where to anchor?

A: AMS and DRS organic growth better than mid-teens, seeing continued penetration and good backlog, more optimistic for growth.

Q: Talk about how new leadership in global services could improve performance.

A: New leader will take fresh look at business, end markets, attack strategies, strengthen operating cadence, talent agenda, and compliance culture.

Q: Talk about the $10 million security losses.

A: It was a theft in Latin America, timing issue between Q3 and Q4, no more expected impact for rest of year.