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PresentationTomohiko SanoJPMorgan Chase & Co, Research Division All right. Hi, everyone. Thank you very much. And this is Tomo Sano from JPMorgan covering SMID Cap Industrials. This is Verra Mobility Corporation's sessions. And then with me, we have Craig Conti, Chief Financial Officer. Thank you very much, Craig, for joining us. So let me start by sharing why Verra Mobility is such a standout in this year's conference lineup as the market leader in U.S. tolling, automated enforcement and smart mobility sol ...

Verra Mobility Corporation Conference Call Summary Company Overview - **Company**: Verra Mobility Corporation - **Industry**: Tolling, Automated Enforcement, Smart Mobility Solutions - **Market Position**: Market leader in U.S. tolling and automated enforcement with over 90% recurring revenue [1][5] - **Financial Profile**: - Projected revenue for 2025: just under $1 billion - Service revenue: 94% of total revenue - Adjusted EBITDA: over $400 million - EBITDA margins: 42% - Free cash flow generation: approximately $137 million for the trailing twelve months ending 2025 [5][6] Business Segments 1. **Commercial Services**: - Accounts for about 45% of consolidated revenue - Market leader in toll and violation management for commercial fleets - Expected mid-single digit organic growth over the next few years - EBITDA margin in the mid-60s% [7][8] 2. **Government Solutions**: - Represents nearly half of the company - Industry leader in automated traffic enforcement for cities and school districts - High single-digit growth expected - EBITDA margins in the high 20s%, projected to improve by 2028 [8][9] 3. **Parking Solutions**: - Leading technology provider of end-to-end parking management solutions in North America - Focus on SaaS services and hardware without owning real estate [9] Capital Allocation Strategy - Total capital deployed since going public in 2018: approximately $2.5 billion - Priorities include: - Organic investments (CapEx primarily in government solutions) - Strategic M&A (approximately $1.2 billion spent since going public) - Debt repayment (around $200 million paid down) - Share buybacks (approximately $650 million since going public) [12][13] Cultural and Operational Insights - **Company Purpose**: To make transportation safer, smarter, and more efficient [22] - **Cultural Pillars**: - Do what's right - Courage over comfort - Win together - Emphasis on operational discipline and customer-centricity through a common operating system [24][32] Growth Strategies - **Volume Leverage**: Significant scalability across all business segments [46] - **Market Expansion**: Growth opportunities in government solutions and parking solutions, particularly in universities and small to medium cities [47] - **Innovation**: Focus on connected vehicle strategies and new market openings [47] Key Contracts and Opportunities - **New York City Contract**: - A $998 million contract for the next five years, with options for renewal - Largest deployment of photo enforcement technology globally - Expected to be EBITDA accretive despite some initial margin impacts due to expanded scope and pricing adjustments [50][52][58] - **California Opportunities**: - Expansion of photo enforcement technology and regulatory changes expected to generate significant revenue [91][93][96] Technology Platforms - **Mosaic Project**: Aims to consolidate legacy systems in government solutions, enhancing efficiency and unlocking value [80][85] - **Transition to SaaS**: Movement towards equipment-free deployments in the parking market, targeting a true SaaS business model [88][89] Investor Insights - **Recurring Revenue Model**: 94% of revenue is service-based, primarily recurring [124] - **Market Position**: Strong presence in photo enforcement and tolling, with significant growth potential in protecting vulnerable road users [130][131] - **Future Trends**: Anticipation of technological advancements in tolling and enforcement, positioning Verra Mobility for sustained growth [132][133]

Verra Mobility to Present at the 2026 J.P. Morgan Industrials Conference Accessibility Statement Skip NavigationMESA, Ariz., March 10, 2026 /PRNewswire/ -- Verra Mobility Corporation (NASDAQ: VRRM), a leading provider of smart mobility technology solutions, announced today that Craig Conti, Chief Financial Officer, is scheduled to participate in a fireside chat at the J.P. Morgan Industrials Conference on Tuesday, March 17, 2026, at 9:30 a.m. ET.About Verra MobilityVerra Mobility Corporation (NASDAQ: VRRM) ...

Group 1 - Verra Mobility Corp. (VRRM) has been previously rated as a buy due to improving fundamentals and the recent NYCDOT contract win, which alleviated a significant uncertainty in the equity narrative [1] - The company is focused on leveraging various investment strategies, including fundamental, technical, and momentum investing, to enhance its investment process [1] Group 2 - The article serves as a platform for tracking investment ideas and connecting with like-minded investors [1]

Group 1 - The session features a discussion on the business segments of Verra, highlighting the mix and growth drivers [1] - There is an emphasis on how the business mix is expected to evolve by 2026 [1]

Verra Mobility Conference Call Summary Company Overview - **Company**: Verra Mobility - **Industry**: Smart Transportation - **Business Segments**: - Urban Mobility: Collaborates with cities for transportation management, safety, and congestion - Commercial Services: Provides fleet management, toll access, and violation handling - Government Solutions: Leading provider of automated enforcement in North America [3][4] Key Business Insights - **Government Solutions**: - Experienced a renaissance due to legislative changes allowing cities to adopt enforcement products - Backlog of Annual Recurring Revenue (ARR) was $64 million [4][6] - Focus on purpose-built enforcement (e.g., school zone speed, work zone speed) has gained traction [4][6] - **Commercial Services**: - Positioned as the number one provider of toll management solutions for rental car companies - Growth drivers include increased travel demand, shift to cashless tolls, and new toll roads [6][17] - Expected mid-single-digit growth over the next two years, with growth components divided into thirds: travel demand, secular tailwinds, and growth initiatives [15][19] - **International Expansion**: - Focus on cashless tolling in Europe, particularly in Italy and France, with an anticipated acceleration in the next 2-4 years [35][36] - Challenges include fragmented rental car markets and varying local regulations [40][41] Financial Performance and Projections - **Customer Concentration Risk**: - Heavy reliance on major rental car companies (Avis, Hertz, Enterprise) for revenue, with contracts typically renewed every 3-5 years [53][51] - Plans to diversify revenue sources through M&A, though no recent acquisitions have been made due to price thresholds [53][55] - **New York City Contract**: - A new 5-year contract starting January 1, 2026, to manage and expand automated enforcement camera programs [59][60] - Expected to add over 1,000 cameras, with a focus on increasing EBITDA dollars compared to the previous contract [66][70] - **Mosaic Project**: - Investment in a new technology platform aimed at reducing operational costs and improving efficiency [105][109] - Expected to drive profitability and margins in the Government Solutions segment [101][110] Market Opportunities and Risks - **Legislative Changes**: - California's new legislation for red-light and school zone speed enforcement could expand the Total Addressable Market (TAM) by $150 million [111][116] - Florida's school zone speed enforcement is progressing but faces competition and regulatory challenges [124][126] - **Competition**: - Competes with smaller local companies, but maintains a strong win rate (70% on RFPs) due to established relationships and market leadership [149][150] - **AI Integration**: - Utilizing AI for processing violations and enhancing decision-making for cities [155][161] - Ongoing pilots to explore AI applications across various business functions [162][164] Parking Segment Insights - **University Parking Solutions**: - Complexities in university parking management present opportunities for growth [170][175] - Transitioning to transaction-based revenue models to enhance margins [178] Capital Allocation Strategy - **Investment Priorities**: - Focus on R&D for autonomous vehicles and diversifying revenue sources through M&A [185][186] - Share buybacks totaling $650 million since going public, with a disciplined approach to capital allocation [186][190] - **Debt Management**: - Consolidated interest rate under 6%, with a target leverage of around 3 times [191][192] Conclusion - **Future Outlook**: - Emphasis on resetting the business base while pursuing growth through innovation and strategic investments [218][219] - **Key Swing Factors**: - Travel demand, NYC rollout pace, and government program awards will significantly impact performance [200][210]

Group 1 - Verra Mobility Corporation has partnered with the city of Pittsburgh to implement a red-light camera program aimed at enhancing road safety [1] - The program will deploy cameras at six high-risk intersections, with plans to add six more intersections each year, reaching a total of 30 by the end of 2029 [1] - Pittsburgh experienced 750 crashes, including seven fatalities, from red light running between 2019 and 2023, highlighting the need for improved traffic safety measures [1] Group 2 - Similar automated enforcement programs in other cities have shown significant reductions in red-light running incidents, with Arlington, VA, seeing an 86% decrease and New York City reporting a 73% decline in violations since 1994 [1] - The first set of cameras in Pittsburgh is expected to be operational by summer 2026, accompanied by a public education campaign and a 60-day warning period before citations are issued [1] - Verra Mobility is recognized as a leading provider of smart mobility technology solutions, focusing on improving transportation safety and efficiency [1]

Core Viewpoint - Verra Mobility Corp. (NASDAQ:VRRM) has experienced significant stock price decline and missed earnings expectations, leading to a negative investor sentiment. Financial Performance - In Q4 2025, adjusted earnings per share were $0.30, below the expected $0.31, with a net income of $18.88 million, a recovery from a net loss of $66.6 million in the same period last year [2] - For the full year, net profit surged by 335% to $136.6 million from $31.4 million in 2024, attributed to goodwill impairment [3] - Revenues increased by 9% year-on-year to $918 million from $841.68 million, driven by strong performance in services, government solutions, and commercial services [3] Revenue and Earnings Guidance - For the current year, Verra Mobility targets revenues between $1.02 billion and $1.03 billion, adjusted EBITDA of $405 million to $415 million, and adjusted EPS of $1.32 to $1.38 [4] Stock Performance - The stock hit a three-year low at $15.58 during intra-day trading, ultimately closing down 13.52% at $16.18 [1][7]

Core Insights - Verra Mobility Corporation, a leading provider of smart mobility technology solutions, will participate in the Morgan Stanley Technology, Media & Telecom Conference on March 3, 2026 [1] Company Overview - Verra Mobility focuses on making transportation safer, smarter, and more connected, integrating vehicles, hardware, software, data, and people [1] - The company operates in North America, Europe, and Australia, providing transportation safety systems and parking management solutions [1] Upcoming Events - David Roberts, President and CEO, and Craig Conti, CFO, will engage in a fireside chat at the conference scheduled for 12:20 PM PST [1]