Earnings call transcript Q4 2022

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Operator

Welcome to The Brink's Company's Fourth Quarter and Full-Year 2022 Earnings.

Brink's issued a press release detailing its fourth quarter and full-year 2022 results this morning. The company also filed an 8-K that includes the release and the slides that will be used in today's call.

For those of you listening by phone the release and slides are available in the Investor Relations section of the company's website at investors.brinks.com. At this time, all participants are in a listen-only mode. follow presentation. will session question-and-answer the formal A And and will reminder, this being recorded conference is be as a available for replay.

the differ the recent or footnotes of and Actual company's such differences factors most call Q&A press in contain cause will This the available forward-looking that results could could results. release materially SEC estimated projected today's filings. are from Information regarding session statements. and in

obligation without only. to on discussed call representative Brink's this The assumes today is not no from any Information and presented and call update as is statements. written forward-looking may of Brink's. copyrighted be permission used

it I'll you turn President begin. of host Relations. over now Jesse may Jenkins, Vice to your Jenkins, Mr. Investor

Jesse Jenkins

Thanks morning. and good

Joining me today Brink’s Mark are McMaken. CEO, Eubanks; Kurt CFO, and

fourth both the quarter results basis, as reported non-GAAP basis, which XXXX full-year currency the from prior foreign as in and exchange we on constant on well and rates eliminates year. morning a currency GAAP This changes

assess for in press non-GAAP the morning's today primarily believe We Reconciliations the X-K of on GAAP found our to most Appendix results non-GAAP in can the this of will of comparable to results which between provided are comments focus their website. results. the it and easier periods. be Accordingly, results majority non-GAAP release, investors presentation, operating make filing, performance this on our

Mark Brink's Eubanks. turn now CEO, over call I'll to the

Mark Eubanks

everyone, morning, Good and thanks for Jesse. Thanks, us. joining

our to highlighted the for $XXX XXXX in EBITDA, seen This exchange level margins despite on the impact we We the over operating foreign morning guidance and revenue, translation. and results revenue full-year million years. by decade at organic recent XXXX profit, strong quarter fourth due of rates EPS delivered a negative full-year highest operating growth we've reported full-year highest

of segments, strong benefited service. business, Managed in Solutions, our pricing our XX% the growth well current three service and in our growth lines Retail inflationary from Services, All management Brink's rate included as global ATM Digital as environment. four organic in in The double-digit valuables discipline

and cost XXX improved from labor productivity profit margins Operating to continued and actions inflation. respectively, of EBITDA higher pricing margins points mix AMS basis XX basis disciplined DRS revenue, offset and primarily from a points and management result expanded by revenue

year per increase share the $X.XX for share, a was over EPS $X.XX per XXXX.

will we of million share free free $XX average about prioritized XXX,XXX cash NoteMachine, allocation an approximately in year, $XXX the on flow X of price towards the Kurt of October flow we total, use acquisition QX. immediately more and was in In and at generated cash which have cash the and repurchases In capital of accretive share. shares call. per purchased later

I'm in progress growth and strong and post quarter by margins segment remains margins. the were North XX.X% history to leadership operating is in our of revenue allowing organic the Demand XX% North American American us profit highest operating XX.X% fourth the the team the encouraged making.

quarter, that in our well were cost margin quarter from margins time benefits restructuring the for fourth QX which we growth high over XX% EBITDA as during we the Adjusted businesses, benefits the included earnings. efficiency efforts history, the first as the our our early announced from as aggressive saw the in efforts of the in

by continued profit and is We're off points profitable in continued XX%, Operating XXXX. to through offerings. in approximately these margin foundation cost and guidance higher in AMS basis strong strong growth and between XXXX targeting organic productivity XXX DRS X% lines a Our developed of the including business. expected builds improve growth growth

million with and $XXX $XXX $X.XX expected $X share. is million, to EPS be per and between EBITDA between

As always, cash we keenly remain focused generating flow. free on

primarily conversion through adjusted improvements. and generation to EBITDA, year-on-year improvement of XX% expect in working significant flow We growth free profitable cash around capital

Slide Moving X. to

previously the and exchange revenue reported from quick XX% results. impact basis, the throughout on which Starting XX%, full-year was was at organically a side, take included currency up a left-hand currency On revenue X% the year. foreign constant XXXX mentioned acquisitions. up translation look Let's X%,

The Reported currency constant operating XX%, included $XXX to was negative operating In growth revenue growth prior incremental organic operating XX% profit margin all-in delivered profit up XX basis growth. of total, XX%, $XX impact. foreign $XX growth million a included over the XX% improvement an million million, XX.X%, which in year. and increasing of of currency margin point

were EBITDA just million $X.XX share XX% $XXX a with on EPS of of Incremental EBITDA grew $XXX or XX% a to per improved over basis. million Adjusted by margin XX.X%. XX%. reported margins

Excluding the EPS grown MGI, prior year would've XX%. gain of sale the on $X.XX

gain the year on prior move we reminder, XXXX. fully a behind in shares now is the MGI As into us as

to X. Slide Turning

XXXX see growth. like can for our look at key and outlook highlight I'd actions recent undertook our to revenue compared this our early history. strong year deliver You profit XXXX to we a to strong and few performance

processes report years that defined and business. the XXXX our effectively during inflationary recover XXXX, will able established as to ahead. disciplined built across of happy we impacted much COVID we The procedures I'm to more experienced. we us cost were we approach allow a foundational First, pressures we take lines and of inflation many the address capabilities to inflationary of look to

digital pricing value As an additional coming profitability we drive in to continue through strategic improved the solutions, years. through our service we to believe drive quality customers opportunity customer-focused for and there's

Digital to Managed accelerate platforms service Solutions able AMS. Retail growth and or in Services were both our DRS tech-enabled or we ATM Secondly,

fair best in capture detail, growing these strategy As to to on next slide evolve. continues more I'll markets on than our discuss our more the share of how

enterprise both regional in all as DRS, by our seen the segments larger are encouraged In customers. as we we've mid-size the multi-site well success across businesses, small and to-date of

the While been of America encouraged geographies. primary we adopters the in solutions, we have and other these to North expected Europe be by uptake

created that has exciting offering. customer fast Brink's the through Our underserved to bank opportunities our that products tailor worldwide. traditional working resonated in offer that has The previously CIT size an capital not of provisional solution end-to-end solution access considered agnostic provides channels budget credit to ability and to our have

strong ATM leader and David Managed and segment talent opportunities well existing our search trend Services, own effective be cost both to his their ATM with North the leveraged AMS working to and our we to in team David order outsource financial services. all internal in are strategy for XXXX AMS. the they focus America promoted presence our seeing Europe. to acquisition complement to and outsourcing of The as leaders from Dove aligns closely from of we're core AMS across develop with the In PAI on geographies institutions retailers solutions global management

to at post performance, we and our we history. also year, services the highest to well growth in were operating operational the in recent the in the throughout margin level services as to AMS, outsized continued margins saw we like were addition the efficiencies revenue higher Growth In global and drive able also to business. as contributors DRS

Business apply framework, XXXX, Brink's lean Using globally. and develop efficiencies Under During standard Brink's closely we practices create The System, expanded of operational and global operations. we aspects System in Business excellence. continuous processes achieve and across the best a examine improvement The we our business to many

to margins delivered the standardized basis operating in staffing, saw applications route where These and us fleet we ranging, initiatives labor and employee included workflow, by allowing areas While are in wide points XX expand and efficiencies, of turnover XXXX, the early optimization. results future BBS full-year.

early And Brink's employee the attributed to of the over in the few margins in year we through XXXX, of America be course System. scaled years Business phases North we this partially last practices can The parts success BBS the story turnover in the and to delivered region profit an Strong lean The of most came over best developed other the tangible America. world. we Latin

the driver the led we revenue quarter. year North over fourth XX reduction staffing XX% as a The and Labor a challenging unemployment business labor service we the the XX-year market, growth, improvement, the have quality the turnover delivered in XX% segment. markets was in clear XX extremely year-over-year Despite improved improvement levels in been with U.S. turnover margin the tight months to months of lows. posting American and exit recently in rates in last to

happy would our progress. with turnover we higher While than remains we are like,

and our standardized I basis planning margin progress initiative. additional as Business fleet under and sharing expansion areas Brink's important introduce forward The journey this look to XXXX. like for in goals continue will that excellence KPIs System XXX our We efficiency to with point allow meet playbooks to will drive we and forward capacity us move

savings pleased program with the of last announced on progress improvements also we've generate to $XX more cost expected structure by approximately of restructuring than I'm end million the million to that we estimates, estimate the the XXXX. made We bringing $XX now our original permanent about quarter.

will enhancements optimize But excited generated I'm I'm that to double-digit time. business they about scale excited the the about deliver and this as margin organic in made improvements we've more even year. benefits have the the future growth these and strong over improvements

strong continue to XXXX let's financial as we turn our improve to performance how Slide XXXX. our backdrop, model and in this With discuss X,

Here on business, this X, on lines growth our with plan Slide focus of year benefits. we each to and primary three expectations financial efforts different

our valuables logistics our well X% success. services of These of growth. foundation continued old business management great our form part XXX-year global an our of This includes portion as services and and organic transit The a as traditional in Brink's our business. operations, with business company of cash important had are line XXXX cash the

is relationships our for while with our our profit from us shareholders. innovate margins Deepening better our Our simply partner, is a to moving to and our for for customer operational developing into strategy customers customers. vendor continue in a offerings these and to this opportunities relationships providing area strategic Brink's solutions journey, higher deeper being excellence

cost often and natural business points and that are acceptance service. solutions customers with legacy traditional provide a of Digital provide more with credit we working easy retailers full Solutions access CIT our a capital. price debit We cash at as as visibility Retail their ecosystem to cash fast innovate extension to than our make to effective as

carbon solution. and of have longer-term and allows all optimize growing solutions stocks with pipeline for allowing we XXXX solutions. strong and eager with rates. robust management revenue create scheduling continue contracts for producing visibility digital opportunity solutions reporting fuel opportunities see driving seeing margins, our demand expand customers to better we DRS, to us the market XX%, cash DRS Only to a that lower was comes to year while for our and our of arises, these and revenue of addressable existing these segments, with currently another resources. of when customers recurring need see price customers. an We're growth volumes both inherent also better usage retention to our own for new through emissions, cash that for points don't access a The organic across customer these

that replenishment solution AMS top an turnkey model, acquisitions, innovation a just retailers to the on from both improves Services Services. Replenishment offerings outsource performance. we and time AMS beyond enable in team ATM institutions or Managed customers and additional financial global a move building holistic traditional cost a and ATM are provide recent in Leveraging on Finally, to our focused which in institutions of out retail cash These flexible and space. financial infrastructure expertise reduces

Our around and for world strong us relationships choice in brand an customers the looking logical the markets option. reputation a for existing make outsourced

shift the meaningful branch institutions a while toward through from recognized in footprints have customers reducing to their maintaining financial ATMs. market connectivity We

us of XX%. pivot Services and organic Managed size channels. solutions meet presence, banking the and resources into our other was geographic differentiate AMS of we they digital banking as range our ATM solutions in storefronts -- away growth that the the from providers. bank With XXXX offer customers Our from a needs

strong of expect acquisition October line both in of continue NoteMachine. as and business growth integrate organically to this We we XXXX, the in inorganically,

external success favorable growth inform these prospects, Our for sight and areas, a future our to market in XXXX. outlook line of factors

expect as XX%. business, growth valuables business between our grow and shift traditional we We DRS traditional than AMS total expected cash higher solutions. are our organic gradually margin X% and mix faster from to logistics to revenue to services management

operating we higher Above average profit With additional plans, The Business XXXX. to our benefits historical margin XXX lean adjusted allow plan the Brink's to EBITDA will business continued the free our deliver profitable restructuring place growth efficiencies we and market in have margins I'm that part as for and opportunities to us in margins the see and front years from points the are the in in XXXX. of expand by of to shift for expected revenue, cash of operating generate basis and approximately initiatives flow in we of System strategic XXXX us growth in confident to record XX% approximately our come. gained through initiatives

our comments. capital of guidance. through walk to points closing the will CFO, with the some of to return I'll and priorities, review now hand more allocation over Kurt? McMaken, it detailed the our I Kurt XXXX quarter, finer a

Kurt McMaken

Thanks, Mark. morning, Good everyone.

year EPS by we X% revenue, X% achieved EBITDA, growth currency up quarter. organic FX. summarizes with versus offset acquisition the fourth and Revenue XX% XX% in and growth and of strong the constant Slide in negative growth profit, X of from partially impact was prior the that X%, up

profit up profit grew a margin the points of partially XX%, XX% comparison XX%. year. of and our Operating X% strong history difficult a XX% basis offset up was by adjusted On XX%. XXX growth XX% first margin higher currency time exceeded XX% a last in last negative has than in EBITDA year, of Organic of quarterly was up currency and operating basis, XX.X%, profit were with a to constant and EBITDA despite FX acquisition-related growth constant quarter

up XX% was EPS currency. quarter constant year the and over ago in quarter up XX% Fourth

X, growth revenue was from organic double-digit and X% DRS constant AMS and on growth lines Brink's and in profit and growth, the more move growth growth segments. Revenue we'll and up a organic Organic all performed growth America, across to Next, versus service strong QX from primarily Slide services, benefited segments year. of XX% of currency in Latin and volume details North our on basis, which well global in increases world organic with XX%. operating price segment rest All America, prior provides Europe.

year. quarter Our or reported million billion, up of was $XX $X.X last versus X% the revenue fourth

last versus organic of with growth was was Next, operating efficiencies. pricing another operating of XXX cost year. constant and reported points acquisitions headwind turning X%. XX% currency an $XXX XX% quarter operating XX% including XX.X% up a which million, strong versus leverage, in The to last was by margin XX% FX in resulting profit basis last improvement year, to of adding year, in the up operating over profit, for discipline, profit driven

business, Excluding to North the four our American we in all year-over-year profit litigation related achieved a expansion history. XX% Romanian our prior a Mark as in this exceeding Europe, first in earlier, And segments. year one-time time margin gain in margins segment saw for geographic high record quarter mentioned

profit. growth fifth this our consecutive to like double-digit double-digit revenue and profit, consecutive that growth also and and I'd and of revenue note is third quarter currency of quarter the organic constant and

$XX lesser to interest our interest period quarter and to operating same walking million debt let's to primarily turn million, rate versus and higher Starting Slide $XX up levels of X. with last year, the Now Fourth debt. rates floating profit due to left right. extent, expense was a higher on our

in was look mix foreign as Next, of effective The XXXX, we rate. offset impact rate. rate to as to points rate. tax in our expectation expense expected a higher of reduction And of was the This higher $X deductions tax lower $XX geographic XX.X% versus was rate consistent than to anticipated the last basis is than partially effective to year million million, our tax to full-year XXXX certain somewhat favorable by income year XXXX was income remain XXX tax income the and jurisdictions. prior due and up the

of million million taxes, operating $XXX operations, and year. a million total, profit, of over non-controlling interest income generated and less In interest, $XX $XXX from other up continuing last expense,

the flow noted last versus QX as was was slide, up through revenue to year, due up basis year. operating as primarily profit. Fourth $XXX on million higher a quarter $XX XXX versus XX% prior million I last EBITDA XX.X%, percentage And or of of points of EBITDA of a

on our and shares earnings Finally, note a share. per

our on X%, share, weighted versus million outstanding X.X we accounted year basis. last about earlier, reported about diluted increase repurchases of about average last by earnings generated $X.XX or shares Share EPS. XX% a shares noted a year per up $X.XX versus reduced As for and in

expense. about provided rate year. driven higher versus higher and the tax increase by partially effective The lower EPS interest was remainder offset Our $X.XX by last profit of

our in flow adjusted $XXX year. we cash XXXX. Starting turn over increases, $XXX the $XXX was million, on the items year. expect than capital prior led Next, on prior was normalize Working the largely of we'll which better cash above to that were several free Slide expectation There to million million EBITDA usage XX. to left,

have as Mexico. and DSO receivable mix balances accounts to predominantly First, discussed, saw in we previously related increase we an

We to foresee and risk Mexico material make the more continue return change to to invoicing regulatory $XX in after don't improvements the early solid to and expect but XXXX. progress we We above drove prior meaningful requirements year. remain DSO quarter-over-quarter, levels in about normalized collection in million

during our and that XXXX, strategic to see led industry a we although our major XXXX, many and to the make tech-enabled difficulties chain, investment supply others in yet devices. impacts from early us impacted Second, have

we the prior see protect our important revenue customer years. working this strong XXXX. a With we assumptions felt increase of capital do hand to as quarter it demand growth on maintain foresee in increases subsequent and not adequate additional and profitability in was devices to DRS, into one-time in with supplies discussions, Consistent

early We And orders course require accounts. of a finally, few advance last cash for change when return normal we advance XXXX, business our to process customers the in filling of the cash the Saturday. orders that change that's year-end unusually falling several to to Electronic day service. a to position on reimbursement January deliveries expedite us days weekend cash our business, the to of take on due the in can stock for order settled saw in to large our

these of across in capital use the about which can of working restructuring, includes we million $XX the from some page, see to targets benefits items. cash expect recovery for and you the XXXX the As bottom of

traditional our model. DRS payment in AMS, stock-based also our mix billing more and to models subscription they as have improvements recurring more We from have shift versus capital working

with in $XX year, were and line $XXX in the tax income. improvement cash last of prior of taxes perspective an jurisdictional million, We to year. to $XXX taxes expectations rate payments but of expected and XXXX million our flat due million approximately XXXX versus estimate mix dollars up roughly a from cash

million. year, than million through levels. was interest and to $XXX in Cash is our interest higher rate an higher increase due million, of $XX XX% of last interest primarily floating debt the that debt full-year the higher Flowing increases $XXX million and results debt $XX cash to on of variable in XXXX, the rates

a at CapEx to despite CapEx cash expectations expected relatively XXXX growth. about in of Net is at below remain flat $XXX cash with line revenue. was X% slightly million rate $XXX The result volume and million mix as us decrease solutions, infrastructure retail more which to CapEx streamline by and of shift right-sizing to our our business our the optimizing routes and in fleet. allows logistics require digital less

$XXX XXXX working In million capital impacted with of cash flow conversion just was the items by XX% I negatively total, free short-term mentioned. of a

of million We expect leading and to between flow generation million those normalize over $XXX cash XX%. conversion per free to of $XXX approximately XXXX

and cash of our behind creation, plan improved by cash specific free Recognizing adding aligning bonus the flow importance our for free flow we're managers. targets free generation annual XXXX organization cash value to flow the

I'd Slide capital to on Next, turning priorities XX. spend like to for a few our allocation. minutes

operating factored to AMS in earlier. million And organic DRS and we the to through revenue discussed Our our drive $XXX businesses the as build-out that our approximately like revenue, below we we've businesses returns. and we into profit total investments earlier. as that largely that we AMS X% teams of expenses mentioned achieved year, that in of XXXX, expect our Brink's or CapEx come Mark shift and strategy flow growth costs strong in and System of remain efficiencies next Business the cash begins Those for operating with guidance form investments profitable have

shareholder to the of by XXXX. reduce Xx cash approximately within leverage Next, are our just flow from and adding the end NoteMachine for year-end. full-year we free we're adjusted our all ratio EBITDA acquisition we X.Xx be by ensuring returns assume was mid-point adjusted land over Xx utilized XXXX cash assume October, creates we in This in EBITDA, and EBITDA and targeted of range further capacity X.Xx were flexibility currently at while to debt If a targeting our between leverage the target. our

In we consistent our plan the existing during for capacity capital remaining returns, increases our flexibility XXXX, share repurchases to market more with in modest million we also reducing repurchase our is regular into when basis target have have on a range share dividend. providing attractive, $XXX debt the on to continue existing while levels

explore are on M&A finally, we free the front, our service existing deals to profile manageable accretive within our continue that within or cash targets. flow geographic and and And leverage fit base offering

allocation robust excess returning long-term earnings, by capital driving initiatives, in to to investing priorities value generating Our shareholder cash are driving committed our cash, shareholders. growth and

guidance Next our summary Slide a as of our XX to as a framework XXXX well around targets. provides XX. Slide XXXX

at XX%, XXX expect of XX%. deliver margin and conversion points. reflecting also basis our cash Our an mid-point driven headwind we XX%, the strong and to earnings of year. cash free on operating XXX expect in performance increase X% profit growth organic of of partially flow, revenue flow X% rates EBITDA, year-end. increases double-digit growth into in momentum Operating achieve share, And XXXX, FX solid X%, growth of to approximately offset to we to of XXXX by provides with next by free strong per guidance, to based from leverage In a X% of around approximately

three-year financial improvement operating Our the over of basis growth three-year remains revenue framework of and high-single-digit original intact. XXX points annual mid period to margin organic

interest to our on in We current a cash rates growth acquisitions, also XX%, expect EBITDA FX, free factoring and approaching generate debt. flow conversion

that our and Brink's with improvement I'm confident Given deliver framework strategy our these targets. The XXXX, on our performance growth System the we'll strong for along through in continuous Business business,

With that, a I'll it to remarks. for hand back closing few Mark

Mark Eubanks

Thanks, Kurt.

our objective strategic is sustainability. XX, Embedded our see pillars. foundational Slide within and can pillar core to On commitment each strategic you our

improvement, growth and years partner pillars and of for revenue choice in investment these position and an of each innovative as Brink's come. Our employer will to business drive margin

working business every customers and improve we're make action single take our and by embrace Customer service and both service we working experience trusted has partner Brink's hard across our with of loyalty. customer all become mindset in to lines growth been customer. decision a fully part We're considering a longstanding a to customer-centric a and create exceptional consistent we to to

These relationships allow to innovation. customers our us deeper with in partner

and Digital ATM to solutions new Retail must to and software and Services. innovate and opportunities create landscape. streams continue create challenges, the address with payments customer's We to Managed Solutions our tech-enabled in -- evolving biggest revenue remain We our hardware capitalize including on emerging drive value the agile

With the the a focus will global improve excellence, continuous share practices focused improvement of our experience expand improving best systems leadership culture customer a and across operations advancing on on we operational The we're System and rates. Under service team, eliminating margins waste. Business our our and Brink's operating that

strong And best empowers and our is ensure only develops, workplace will achieve employer and people and perspectives our a diverse Establishing our brand to we that talent as that finally, business an the as have people. attracts, goals.

opportunities confident we priorities. operations. have by the superior ability by value we create excited execute of strong in Brink's and delivering experience we're into we XXXX. throughout year. I'm momentum strong customer a the front I'm will to XXXX, on proud of and as In in about delivering encouraged driving the grow our efforts a continuous in our these long-term strategic the I'm shareholder of team carrying our improvement us

session. facilitate Q&A Operator? the I'll operator now the answer turn it to to over

Operator

begin Ladies at and question-and-answer session. [Operator we'll Instructions]. this gentlemen, the time

your with question first go question. comes today Please from from Goldman Our Tong ahead George Sachs.

George Tong

on revenue in at with volume support can an that the organic retailers seeing in you're XXXX, what can trends of healthy how you XX% solid week all? is per current retailer organic provide among growth? the continued Relatively Hi. macro average if performance revenue changing, And and growth number update stops per environment

Mark Eubanks

significant morning. take seen in any We softness Mark. seeing George, that that retail. Sure. demand haven't signals would that. I'll Good This is we're really indicate

is whether talking In in the from us lately fact, you've with out that, of is of or services two for purchasing a retail like, of areas that with given summer is some And retailers. I big some retail, the different travel. area method, signals we or demand the where services. Obviously about sort that heard moving businesses of a preferred the travel. consumers think for for you really forecast story with couple in-person, toward which to largely And shift with goods and the playing an Airbnb see future hospitality course, largely just that's is payment QSR here and cash that's the airline those

forward. the us around real those confidence we going -- see things or actually that, But data demand don't some So give around destruction any retreat.

with but our -- seamless provide asset solution. and footprint, allows drive across the only our a on thing stops, stops we optimize stops we utilization us also ATM think more better, the we're which to stack again DRS, I not us more our other average full more customers Managed the our the allows and to routes on full remember is more productivity on deploy and to line to as that as customer and per Services, able a more optimize integration with

George Tong

the you over to Services Solutions helpful. tech-enabled with Where past a discuss Can perspective? initiatives Got further up And point XX% Digital you year. to related your tech-enabled solutions? XX% currently Managed your That's solutions the your your Retail saw significant portfolio, priorities last scale growth ATM are growth it. in and from up

Mark Eubanks

Sure.

We broad-based. focused in and are areas, I'd all it's say

view than outlook on those the Specifically a us talked space. underserved DRS, the existing expected and international We and traditional around continent. which in unvended today conversion XXXX got balanced I every seeing world about in Investor we've customers, a, in growth. And opportunity business, is DRS giving around opportunities in probably We're our early we seeing in on Day encouraging. a course are at on, and We're opportunities think big just in fact, we're many about which our not globally. this seeing markets more a almost is balanced probably markets there of where of the footprint

of Services, ATM business And markets. broad-based to strong footprint Managed is our the course, with we've inactivity. got a that, Relative also that traditional in all

those growth. the two -- well been our North and growth. we're in not of in for most to recently the skillsets Europe our for America driving really to which allow basis as driving PAI acquisition acquisitions the how acquisition, capabilities we're think the with I we've with but seen opportunity as and has NoteMachine development drive organic infrastructure basis they're They're us are

You in as areas evolving the those discussions, are be BPCE not the healthy in seeing unfolding. on Asia-Pacific America. we've and this or us But we're as is in course America for of other in our Baltics strategic are with those of or whether more only going chronicled past, good pipeline Latin their North with in organic and outsourcing more their more backdrop opportunities growth that with well network can is footprint the -- as both about some we're and a customers, wins banks numbers outlook And of organic current but their forward. talking our

Operator

Our question. from your next Tobey Please Securities. Truist go from ahead comes Sommer question with

Tobey Sommer

And hoping I the and are within sort the we and higher Thanks. flow of that control, free cash cash know get to this to to control trends, that Thanks. sort in I arc was your give are don't you speak could year that because to things just future. maybe of and for CapEx the rates. free terms out of the us that within move contribute optimization choose in of other means conversion. digital any your But the things your that what of a contours

Kurt McMaken

Yes. Kurt. it's Hey Tobey,

and that take add on. me Let Mark can

up me the is go And to as kind very biggest the we when looking we're component trajectory then at what of look free next. that. components, at about I you our cash deliver. good And other beyond obviously of EBITDA. ahead look just flow, we think you that, our on pick So look you feel let CapEx the when And

models going our enable fact stay forward. and efficiencies at before business said largely like And to us revenue. because same when the that allowing need is -- percentage operational You to changing business going our flat as for is the mix the of as we feel our we really levels we did of of you we've that look CapEx don't CapEx reason basically a the it

us that. gives that So off of leverage

within that's So our control. well

number drag temporary -- the turning capital within control. at we next, we all into of about items. we well -- for the of year If we working you of consider kind the those components, at XXXX a look a that end the see the of fact And had here that talked our

picks as that's into the second half to continue. of free on It's year the for cash than and we we would see us we the that know, tend in the you up of year, that go first and half year. normal ramp And the lower As flow. very

to components, I we're Xx control from say we're interest mean on and on other I we're going target I'd again -- our we've between The basis, as cash pretty leverage. well -- because and interest our Xx a within mean said, taxes

with we then so got keep on in that's flat that achievable. that And and cash sure And we'll taxes, much remain pretty it taxes XXXX the consistent. We've check. make very working to our think

Mark Eubanks

just little add to about and I'll may bit beyond. arc -- the into I So in a thinking that. just asked Tobey, you XXXX XXXX

getting we drags, makes that XX% think low through cash on XXXX XXXX history of I cash kind percentage bit is consistent sort way, fact conversion foremost, that the which XX%, rates. say you we to temporary XXXX that these mid-low given had one-times, and at capital of the And daunting. for on XXXX, these that's XX% conversion conversion number, so previous First -- that not nominal XX% our conversion XX% -- the XX% by the the working a misleading with XX%,

million in January AR things mentioned timing in change that relative orders. recovery and the to already that he Mexico, improvement the items other Kurt have into built some I themselves next part of are here a about thing of large for year-end of mentioned, whether $XX those is confident resolved we or -- that working that year a it's think is larger capital in some the of

good So that. about we feel

the we piece think of I as the is mix DSO business businesses. go-forward other around our of

And there penetrate subscription-based model. our existing so and we've continues piece got stop of become better on terms as our -- traditional to models AMS become portfolio and the revenue, a a bigger DRS bigger based versus

and and improvements we Kurt flow of attention with incentive specific plan And I the that we their that tied course, other changes to management so referenced incentive with backdrop behavioral think change think where plan. can drive that cash conversion some

going right -- management think the change sets it's forward. I it perspective

Tobey Sommer

to me. that cash it year? to point, is you tool sense a expect improvement? And drive that comp the as something be last is a makes on That follow-up an and on feature do in of of free think sort lot focus of incentive beyond strategically a Or comps appropriate this to philosophically you a incentive

Mark Eubanks

think preserving Yes, absolutely. think and I Tobey, we was permanent of incentive, the a for piece of value maintain profitability go-forward we forward, component so, Not go-forward. be shareholders. think going management this pandemic, the go-forward year this frankly, as is company is permanent our lean only cash going rightfully to as well piece part compensation. focused creation growth of as our during our it's on a a but And a

Tobey Sommer

color some the drivers of this business of something of but calls, services? year. we you love don't how and/or sort elements update lot these on Brink's always weaker It's growth strong us and get on talk give on a see global sort you Could that evolving an to of Right. I'd what the about

Mark Eubanks

Sure.

Tobey, due and metals, notes, in We network to continue to have a moving our frankly strong industry. global precious in this position, bank relationships

as rate in valuables. see that so whether its disruption and that types whether investors of we ecosystem to continue we wars, specific in allows interest move out are of pandemics, move, And regimes part of it's to

precious or in Bank people gold it the or as Central the As silver currency around globe, coming rates high of world, movements whether bank we around that Well, we're world at shift now, metals prices of and specifically was time, the look revenue cash and same demand, or pandemic moving movement at pandemic more saw a were note as we moving the where but had out at the moving we as, so well around seeing forth flows. around government lot we're commodity country contract. storage to and the country were back that as more interest drives repatriation seeing that

we've there in note And this significant business bank seen so the uptick year. that

Tobey Sommer

areas a company? anything year for me, institution highlight opportunity next, is and outsourcing for this that the you customers there hearing would from financial most of question as likely last the is And focused area biggest you're that

Mark Eubanks

frankly, we you continued growth had XXXX. platform the sorry, growth and and from And the Well, and it's organic the -- AMS we've number -- and seen is coming I receive in to Managed really from more -- is -- that business, proposal saw big from our discussions are we whether bank growth expect North that. financial Services that with strong way. us. institution whether outsourcing. And others, ATM certainly we our -- we'd banks are, And seeing activity as by and where have I public around we've mentioned requests negotiations private the entering footprints it's we're America world I'd into Europe, in -- we're widespread this the the or for say And while before, and

we in-source customers, I'd are the of logical many such that for service ATM in the with large a a say value we given these of partner amount management. their stream provide fact currently

Dove, on to some exploratory for we're solution. infrastructure we're technical and with first And is President, infrastructure. is as so logical around these ready which good our mentioned us, business partner make have well who's and as that David sure best to capability into both discussions we're We I built-out the And discussions what customers that discussion. us it, find global was a of that ATM building Global part the those appointed be enter our for for for why purposefully out able to development

that in mix profit forward to and cases, in year-on-year. an those us this continues business look help part our the And is improvement drive as of a we by our wide the varying XXX our of as range solution has basis all way, But point base to framework of margins services. accretive

Operator

today's with And We ladies well conference as thank going question-and-answer gentlemen, for today's today's presentation. and session to that, conclude call. do as we're you joining

your lines. now disconnect may You

The Brink's Company (BCO) 22 Feb 232022 Q4 Earnings call transcript