Crane NXT (NYSE:CXT) 2026 Investor Day February 25, 2026 08:30 AM ET Company ParticipantsAaron Saak - President and CEOBob Labick - PresidentBob Stewart - Aftermarket Service Support and Global Brand Protection ManagerCharlie Rose - Partner and Director of ResearchChristina Cristiano - CFOChristopher Arena - SVP and Head of On-Court and Brand PartnershipsIan Zaffino - Managing DirectorMatt Roache - VP of Investor RelationsMichael Mahan - President, Crane Payment Innovations (CPI)Robert Wertheimer - Founding ...

Financial Data and Key Metrics Changes - Sales growth was approximately 20% in Q4 and 11% for the full year 2025, with adjusted EBITDA margin at approximately 25% in Q4 and 24% for the full year [4][11] - Adjusted EPS was $1.27 in Q4 and $4.06 for the full year [5][11] - Free cash flow conversion ratio was approximately 135% in Q4 and 94% for the full year [4][11] Business Line Data and Key Metrics Changes - CPI core sales were flat in Q4, with double-digit growth in gaming offset by softness in other markets [12] - Security and Authentication Technologies (SAT) saw core sales up approximately 11% in Q4, driven by strong performance in Crane Currency [14] - Adjusted operating margin for SAT decreased by approximately 420 basis points due to unfavorable mix and increased costs [15] Market Data and Key Metrics Changes - International currency business showed strong performance with organic backlog up over 30% year-over-year [7][25] - CPI is expected to be flat year-over-year in 2026, with mid-single-digit growth in services and low single-digit decline in vending [19][51] Company Strategy and Development Direction - The company is focused on accelerating organic revenue growth while maintaining strong margins and free cash flow [4][30] - Investments are being made in international currency business to expand capacity and meet rising demand [25][27] - The acquisition of Antares Vision is progressing, with plans to consolidate results under Crane NXT in 2026 [29][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the sales outlook for the currency business in 2026, supported by a strong backlog and new contract wins [7][30] - The company anticipates full-year sales growth of 4%-6% in 2026, with adjusted EPS guidance in the range of $4.10-$4.40 [18][22] Other Important Information - The company announced a 6% increase in its annual dividend while maintaining capacity for future acquisitions [18] - Adjusted EBITDA margin is expected to be approximately flat year-over-year at 28% for 2026 [21] Q&A Session Summary Question: Can you discuss the margin performance in SAT and pricing strategy? - Management noted that contracts are executed from backlog, and they are focused on maximizing value and pricing power with new contracts [38][39] Question: What is the expected EPS cadence throughout the year? - EPS is expected to accelerate through the first half of the year, with a total guidance of $4.10-$4.40 reflecting continued strength in currency and authentication [41][42] Question: What are the dynamics in CPI for the first quarter? - CPI is expected to be flat in 2026, with growth in services and a decline in vending due to tariffs, with Q1 anticipated to be the lowest quarter [51][52] Question: What is the status of the $10 bill onboarding? - Management is confident that the U.S. Treasury will announce the new $10 bill mid-year, with full consumer release expected in Q4 [54][80] Question: What are the drivers for faster growth in international currency? - Growth is driven by increased counterfeiting, growth in emerging economies, and faster redesign times for currency [67][69]

Core Viewpoint - CompoSecure, Inc. will be rebranded as GPGI, Inc. and has appointed Graham Robinson as the new President and CEO, effective January 22, 2026, to lead the company through its next growth phase [1][5][7]. Group 1: Leadership Transition - Graham Robinson has been appointed as President and CEO of CompoSecure, succeeding Jon Wilk, who served for 10 years [1][5]. - Robinson brings 30 years of experience in technology and industrial sectors, having held leadership roles at companies like Stanley Black & Decker and Honeywell [2][3]. - The transition is not due to any disagreements with the Board regarding financial matters, and the company's financial performance remains in line with expectations [6]. Group 2: Strategic Direction - The appointment of Robinson is seen as a strategic move to support CompoSecure's growth strategy, focusing on operational excellence and M&A [2][5]. - CompoSecure is positioned in a high-growth market for metal payment cards and authentication solutions, with sustained customer demand and investment [3]. - The recent business combination with Husky Technologies is expected to enhance the company's market position, characterized by approximately 70% recurring revenues and strong cash flow generation [7][8]. Group 3: Company Overview - CompoSecure is a leader in metal payment cards and security solutions, providing innovative technology that ensures trust in transactions [9]. - The company aims to deliver exceptional experiences and value for customers, shareholders, and employees through continued innovation and operational excellence [3][9].

Financial Data and Key Metrics Changes - Sales grew approximately 10% year over year, reaching approximately $445 million, with adjusted EPS of $1.28 [4][13] - Free cash flow conversion was 115% in the quarter, on track for a full-year target range of 90%-110% [4][14] - Adjusted segment operating profit margin was approximately 28%, up 50 basis points year over year [13] Business Line Data and Key Metrics Changes - CPI segment sales were approximately $216 million, down 4% year over year, primarily due to declines in vending [15] - Security and authentication technologies segment sales were approximately $229 million, growing 28% year over year, with core sales increasing 9% [16] - The international currency business backlog remains at near record high levels, with approximately 20% organic backlog growth year over year [16] Market Data and Key Metrics Changes - The U.S. currency business is expected to grow in the high single digits next year, driven by increased demand for higher denomination banknotes [5][11] - The Federal Reserve's print order for 2026 indicates a significant increase in demand for higher denomination banknotes [5][11] Company Strategy and Development Direction - The company is focused on expanding its market-leading positions and has signed an agreement to acquire Antares Vision, enhancing its portfolio in life sciences and food and beverage sectors [7][9] - The strategy includes upgrading existing customers from legacy products to advanced micro-optics technology, improving margins and customer retention [8][35] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the backlog and the position for 2026, indicating strong demand in international currency [24] - The company is taking a prudent approach to its outlook for CPI, anticipating continued softness in vending but growth in gaming and service segments [31][32] Other Important Information - The company is on track to achieve adjusted free cash flow conversion of approximately 90%-110% for the full year [17] - The integration of Antares Vision is expected to strengthen the company's position in markets with secular tailwinds [9][66] Q&A Session Summary Question: Currency business capacity for 2026 - Management indicated strong confidence in the backlog and is exploring both organic investments and partnerships to increase production capacity [24][25] Question: CPI vending business outlook - Management noted ongoing order softness in vending due to price increases and macroeconomic factors, expecting this trend to continue into Q4 [31][32] Question: Transitioning De La Rue customers to micro-optics - Management reported good customer receptivity to the transition, expecting significant margin improvements and increased customer stickiness [35][46] Question: U.S. currency redesigns impact - Management clarified that the $10 bill production is on track for mid-2026, with no immediate financial impact expected from the $50 redesign [39][40] Question: Antares Vision integration and guidance - Management expressed excitement about the Antares acquisition but will not include it in initial 2026 guidance until the transaction closes [64][66]

Core Insights - Crane Nxt reported fiscal Q2 2025 earnings with GAAP revenue of $404.4 million, a 9.1% increase year-over-year, exceeding analyst expectations of $383.16 million [1][2] - Non-GAAP EPS was $0.97, surpassing the consensus of $0.95 but down from $1.06 in the previous year, indicating operational pressures despite revenue growth [1][2] - The company maintained its full-year outlook, emphasizing confidence in improving profitability and integration benefits [1] Financial Performance - GAAP revenue increased by $33.8 million year-over-year, with $26.7 million attributed to acquisitions and $10.1 million from favorable foreign currency translation [5] - Organic core sales decreased by $3.0 million, reflecting a 1% decline, indicating underlying demand weakness [5] - GAAP operating profit margin fell to 11.8%, down 6.4 percentage points from the previous year, while adjusted operating profit margin decreased by 2.9 percentage points to 21.2% [2][8] Business Segments - The Payment Innovations segment experienced a 5.8% decline in sales year-over-year, with core sales down 7.3%, primarily due to lower volumes in the vending market [6] - The Security and Authentication Technologies segment saw a revenue increase of 32.0%, driven by both acquisitions and organic growth, with core sales up 9.1% [7] - The segment recorded a backlog of $447.2 million, supported by strong demand for micro-optics and digital authentication services [13] Acquisitions and Strategic Focus - Recent acquisitions, including OpSec Security and De La Rue Authentication Solutions, are aimed at expanding the company's authentication and security solutions [4] - Management highlighted the importance of effective integration of acquisitions and capturing operational synergies as key priorities for the second half of the year [15] - The company is addressing margin pressures and managing rising debt levels due to acquisition financing, with total debt increasing to $1.13 billion [9] Future Guidance - Management expects sales growth of 6% to 8% for fiscal 2025, with adjusted EPS projected between $4.00 and $4.30 [14] - The outlook for Payment Innovations indicates flat to slightly negative sales, while Security and Authentication Technologies is forecasted to achieve 19% to 21% annual sales growth [14] - Adjusted free cash flow conversion guidance is set at approximately 90% to 110% for the full year, excluding one-time items [14]