Brink(BCO)2025-05-12 20:10Financial Performance - Consolidated revenues for Q1 2025 were $1,246.7 million, a 1% increase from $1,236.1 million in Q1 2024, with organic growth contributing 6%[162][163] - Operating profit decreased by $1.8 million to $119.1 million, resulting in an operating profit margin of 9.6%, down from 9.8%[165][172] - Non-GAAP operating profit increased by $5.6 million to $150.6 million, with a non-GAAP operating profit margin of 12.1%, up from 11.7%[169][170] - Income from continuing operations attributable to Brink's shareholders increased by $2.3 million to $51.6 million, with diluted EPS rising to $1.19 from $1.09[165][169] - Adjusted EBITDA decreased by 1% to $215.0 million, primarily due to lower interest and other nonoperating income[170] - Non-GAAP operating profit for Q1 2025 was $150.6 million, compared to $145.0 million in Q1 2024, reflecting a year-over-year increase of 3.9%[224] - GAAP income from continuing operations attributable to Brink's for Q1 2025 was $51.6 million, up from $49.3 million in Q1 2024, representing a growth of 4.6%[224] - Non-GAAP diluted EPS for Q1 2025 was $1.62, slightly down from $1.65 in Q1 2024, indicating a decrease of 1.8%[225] Revenue by Region - Revenues in North America increased by 3% ($12.1 million), driven by a 2% organic increase and acquisitions, despite a $2.1 million negative currency impact[176] - Latin America experienced an 8% revenue decrease ($27.1 million) primarily due to unfavorable currency impacts of $54.4 million, offset by a 7% organic increase[178] - Europe saw a 3% revenue increase ($7.7 million) due to a 5% organic growth, although currency exchange rates negatively impacted revenues by $8.2 million[180] - The Rest of World segment reported a 9% revenue increase ($17.9 million) driven entirely by organic growth, with operating profit up 22% ($9.0 million)[182] Expenses and Costs - Selling, general and administrative expenses decreased by 7% to $186.3 million, attributed to lower net compensation costs and professional fees[164] - Corporate expenses for Q1 2025 decreased by $1.7 million to $31.7 million, primarily due to lower net compensation costs of $4.1 million and lower professional fees of $3.0 million[187] - Total other items not allocated to segments increased by 31% to $31.5 million in Q1 2025, driven by a 16% rise in acquisitions and dispositions costs to $18.5 million and a significant increase in Argentina's highly inflationary impact to $6.3 million[189] - Interest expense rose by 3% to $57.5 million in Q1 2025, attributed to higher interest rates on corporate debt and increased borrowing levels[207] - The company incurred $5.1 million in transformation initiative expenses in Q1 2025, aimed at accelerating growth and driving margin expansion[195] - Amortization expense for acquisition-related intangible assets was $14.4 million in Q1 2025, with additional restructuring costs related to acquisitions amounting to $2.0 million[198] Tax and Income - The effective tax rate for Q1 2025 was 22.4%, down from 33.4% in Q1 2024, with a provision for income taxes of $15.6 million[209] - Foreign currency transaction gains in Q1 2025 were $10.9 million, a favorable change compared to a loss of $5.5 million in Q1 2024[206] - Net income attributable to noncontrolling interests decreased by 21% to $2.3 million in Q1 2025, reflecting lower operating results from certain subsidiaries[210] - The company recognized $6.3 million in pre-tax charges related to highly inflationary accounting in Argentina during Q1 2025, including currency remeasurement losses of $4.8 million[194] Cash Flow and Investments - Cash flows from operating activities decreased by $124.1 million in Q1 2025 compared to Q1 2024, highlighting a significant decline in operational cash generation[228] - Free cash flow before dividends decreased by $40.3 million in Q1 2025, attributed to changes in working capital and higher capital expenditures of $58.9 million compared to $52.2 million in Q1 2024[231] - Cash used for investing activities increased by $2.9 million in Q1 2025 compared to Q1 2024, suggesting a slight uptick in investment spending[228] - Total capital expenditures for Q1 2025 were $58.9 million, with significant investments in cash devices, information technology, and armored vehicles[236] - Cash used in financing activities increased by $122.8 million year-over-year, with net cash used of $124.1 million in Q1 2025 compared to $1.3 million in Q1 2024[238] Shareholder Returns - The company repurchased 514,795 shares for $44.8 million at an average price of $86.97 per share during Q1 2025, with $252 million remaining under the share repurchase program[248] - Dividends paid to shareholders increased to $10.4 million in Q1 2025 from $9.8 million in Q1 2024, reflecting a dividend of $0.2425 per share[239] Debt and Liquidity - As of March 31, 2025, total debt was $3,881.6 million, with net debt increasing to $2,776.5 million compared to $2,582.2 million at the end of 2024[240][241] - The company had $531 million available under its Revolving Credit Facility as of March 31, 2025, indicating strong liquidity to meet operational needs[243] Pension and Retirement Plans - The primary U.S. pension plan's beginning funded status for 2024 was $(10.9) million, projected to improve to $49.0 million by 2029[250] - The net periodic pension credit for the primary U.S. pension plan is estimated at $16.0 million for 2024, decreasing to $9.6 million by 2029[250] - UMWA plans had a beginning funded status of $(77.9) million in 2024, with no expected contributions until 2040[254] - The Black Lung plans had a beginning funded status of $(74.4) million in 2024, with projected payments from Brink's increasing from $8.0 million in 2024 to $6.4 million by 2029[259] - Total projected expenses related to U.S. retirement liabilities are expected to be $(11.0) million in 2024, improving to $5.2 million by 2029[257] - Payments from U.S. plans to participants totaled $73.1 million in 2024, projected to decrease to $68.1 million by 2029[259] - The company does not expect to make contributions to the primary U.S. pension plan until 2027[253] - Approximately 10,300 beneficiaries are enrolled in the primary U.S. pension plan, with 2,200 in the UMWA plans and 700 in the Black Lung plans as of December 31, 2024[252][254][255] Risk Management - The company has not experienced any material changes in market risk exposures as of March 31, 2025[262] - The company’s risk management program aims to mitigate the adverse effects of market volatility on operating results[262]