Brink(BCO) - 2025 Q3 - Quarterly Results

Financial Performance - Total revenue for the third quarter of 2025 reached $1,335 million, reflecting a 6% increase compared to the same period in 2024[3] - Operating profit increased by 37% to $152 million, with an operating profit margin of 11.4%, up 250 basis points year-over-year[3] - Adjusted EBITDA for the third quarter was $253 million, representing a 17% increase, with an adjusted EBITDA margin of 14.1%, up 210 basis points[3] - Revenues for Q3 2025 increased to $1,335 million, a 6% growth compared to Q3 2024, with North America contributing $435 million, up 5%[20] - Operating profit for Q3 2025 reached $152 million, reflecting a 37% increase from Q3 2024, driven by North America's significant growth of 37% to $57 million[20] - North America segment operating margin improved to 13.1% in Q3 2025, compared to 10.1% in Q3 2024, indicating enhanced profitability[24] - Latin America revenues for Q3 2025 were $327 million, a slight increase of 2% year-over-year, despite a 6% decline in operating profit to $66 million[20] - Europe segment revenues grew by 12% to $353 million in Q3 2025, with operating profit increasing by 15% to $46 million[20] Cash Flow and Capital Allocation - Free cash flow increased by 30% year-over-year, driven by improved profitability and working capital metrics[2] - The company reduced its outstanding share count by 5% year-to-date as part of its capital allocation framework[2] - The company is prioritizing capital allocation towards technology-enabled solutions, including AMS and DRS, to drive future growth[21] - Cash flows from operating activities (GAAP) for the nine months ended September 30, 2024, were $426.0 million, with free cash flow before dividends at $399.9 million[53] - The free cash flow before dividends for the nine months ended September 30, 2024, was $399.9 million, indicating strong cash generation[53] Guidance and Future Outlook - The company plans to achieve mid-to-high teens organic revenue growth for AMS/DRS and adjusted EBITDA margin expansion of 30-50 basis points in 2025[7] - Q4 2025 revenue guidance is set between $1,330 million and $1,380 million, with non-GAAP adjusted EBITDA expected to be between $267 million and $287 million[7] - Full-year 2025 revenue guidance anticipates organic revenue growth, with a focus on expanding adjusted EBITDA margins and free cash flow conversion[21] Assets and Liabilities - Total assets increased from $6,623.1 million at the end of 2024 to $6,953.0 million by September 30, 2025[11] - Total liabilities rose from $6,310.6 million at the end of 2024 to $6,556.5 million by September 30, 2025[11] Corporate Expenses and Strategic Initiatives - Corporate expenses decreased significantly by 35% to $29 million in Q3 2025, contributing to overall profit improvement[20] - The Brink's Company is actively pursuing strategic initiatives, including potential acquisitions and market expansions, to enhance its competitive position[21] Non-GAAP Metrics and Adjustments - Non-GAAP operating profit and margin metrics are utilized to evaluate performance, excluding other items not allocated to segments[41] - The company reported non-GAAP free cash flow before dividends, reflecting cash flows available for capital or investing activities[40] - Non-GAAP income from continuing operations for the nine months ended September 30, 2024, was $309.3 million, with an effective income tax rate of 23.2%[46] - For the nine months ended September 30, 2025, Non-GAAP income from continuing operations increased to $335.3 million, with an effective income tax rate of 27.7%[46] - Non-GAAP EPS for the full year 2024 was $3.61, and for the nine months ended September 30, 2025, it was $5.49[49] Risks and Challenges - The company faces risks related to macroeconomic conditions, including inflation and geopolitical tensions, which may impact future performance[22] Transformation and Restructuring - The company initiated a multi-year transformation program in 2023, incurring $28.4 million in expenses in 2024 and an additional $18.6 million in the first nine months of 2025[32] - Restructuring costs related to acquisitions were $10.3 million in the first nine months of 2025, with integration costs of $2.7 million incurred during the same period[30]