Good morning. Welcome to The Brink’s Company’s Third Quarter 2024 Earnings Call. This morning Brink’s issued a press release detailing its third quarter 2024 results. The company also filed an 8-K that includes the release and the slides that will be used in today’s call. The release and slides are available in the Investor Relations section of the company’s website at investors.brinks.com. [Operator Instructions] As a reminder, this conference is being recorded and will be available for replay. This call and the Q&A session will contain forward-looking statements. Actual results could differ materially from projected or estimated results. Information regarding factors that could cause such differences are available in the footnotes of today’s press release and in the company’s most recent SEC filings. Information presented and discussed on this call is representative of today only. Brink’s assumes no obligation to update any forward-looking statements. The call is copyrighted and may not be used without written permission from Brink’s. I will now turn it over to your host, Jesse Jenkins, Vice President of Investor Relations. Mr. Jenkins, you may begin.

Thanks and good morning. Joining me today are CEO, Mark Eubanks; and CFO, Kurt McMaken. This morning Brink’s reported third quarter 2024 results on a GAAP, non-GAAP and constant currency basis. Most of our comments today will be focused on our non-GAAP results. These non-GAAP financial measures are intended to provide investors with a supplemental comparison of our operating results and trends for the periods presented. Our management believes these measures are also useful to investors as such measures allow investors to evaluate our performance using the same metrics that our management uses to evaluate past performance and prospects for future performance. Reconciliations of non-GAAP results to their most comparable GAAP results are provided in the press release, the appendix of the presentation and in this morning’s 8-K filing, all of which can be found on our website. I will now turn the call over to Brink’s CEO, Mark Eubanks.

Thanks Jesse and good morning. Thanks for joining us. Starting on Slide 3, we delivered total organic growth of 13% in the quarter. ATM managed services and digital retail solutions, or AMS and DRS grew 26% organically, marking another quarter of growth ahead of our expectations with double-digit organic growth in AMS and DRS in every regional segment. With healthy backlogs and a good pipeline of future opportunities, we continue to build momentum in these important growth areas. Cash and valuables management, or CVM was up 9% organically with pricing execution offsetting market softness in our global services business. The strengthening U.S. dollar caused an 11% FX headwind in the period. The FX headwind was more than we originally expected, primarily due to the devaluation of the Mexican peso. Adjusted EBITDA of $217 million was impacted by the timing of a $10 million increase in security losses in the quarter. Adjusting for this item, EBITDA margins were 18% in the quarter, down 80 basis points for the same quarter last year. The margin declines included a headwind from dollar strengthening in our high-margin Latin America businesses, revenue mix related to our global services business as well as the impact of a delay in productivity in North America, as we deploy a new routing system. I’ll have more details on North America performance in a few slides. We generated $135 million in free cash flow, with better asset efficiency and working capital improvements primarily related to DSOs and AR management, being offset by the impact of lower EBITDA and the currency impact of our FX hedging portfolio. Kurt will have more on our free cash flow performance and outlook later in the call. We made 2 key additions to our executive team in the quarter. Josh Teteak is leading our Brink’s…

Thanks Mark. Starting on Slide 8, organic revenue grew $156 million, with about 42% of that growth coming from higher-margin AMS and DRS services. The U.S. dollar strengthened significantly in the third quarter, representing $131 million revenue headwind year-over-year. Moving to the right side of the slide, you can see how the revenue converts to EBITDA. Q3 organic incremental margins were impacted by revenue mix, especially in Global Services, a $10 million security loss and delayed productivity in North America from the deployment of the routing technology that Mark discussed previously. Excluding the security loss, organic growth represents an incremental margin of 29% in the period. Incremental margins on FX were almost 40%, as the majority of the currency impact came in our higher-margin Latin American countries. On Slide 9, we bridge operating profit to adjusted EBITDA. Starting on the left, interest expense was up $9 million year-over-year to $63 million. The increase is related to higher interest rates, slightly higher debt balances and the one-time impact of the early repayment of our 2025 bonds. Tax expenses were $28 million in the quarter, with an effective tax rate of approximately 28%, as we expected. The other category was $7 million, $12 million lower than prior year, primarily from the lapping impact of marketable security gains in Argentina in 2023 that did not repeat. Income from continuing operations was $68 million and our diluted share count was down 2.3 million shares or 5%. Our earnings per share in the period was $1.51 per share. To help with modeling a few of these components in the fourth quarter, we expect full year interest expense to be between $235 million and $240 million. We are forecasting a full year tax rate in line or slightly better than the 28% we posted in the…

Thanks, Kurt. As we close a challenging second half of the year, I can’t help but reflect on the transformation progress we delivered and be encouraged about the future. We are committed to improving the foundation elements of our business to methodically progress the business towards our long-term operating margin and free cash flow expectations. Despite the temporary impact of currency fluctuations and market softness in our Global Services business, we remain resolute in making the necessary investments to fully realize the addressable market expansion opportunities of AMS and DRS. So far in 2024, execution of our strategy has proven we have a right to win in AMS and DRS. Our customers have recognized the value proposition of our offerings and our Brink’s team has executed operationally. As we begin to plan for 2025, nothing in the second half of 2024 limits us from continuing the financial framework we set in 2021. We still expect mid-single-digit organic growth when excluding the impact from Argentina inflation, driven by continued strong AMS and DRS organic growth, as we capitalize on the momentum from 2024 and realize the benefits of a growing opportunity and backlog. We still expect to generate 100 basis points of operating profit expansion and we continue to see many operational levers in free cash flow to continue to improve our cash conversion from EBITDA. I am confident we’re building the right team and the right culture to capture the opportunity in front of us. Operator, please open the line for questions.

Thank you. [Operator Instructions] And the first question will be from Tobey Sommer from Truist Securities. Please go ahead.

Hey, good morning guys. This is Jasper Bibb on for Tobey. Looks like the organic guide for this year is rise to low teens versus I think low- to mid-teens last quarter. Just on the organic side, could you outline the relative impact of softer Global Services demand versus what sounded like an increase in your AMS and DRS assumptions?

Yes, sure. Good morning, Jasper. Yes, the Global Services business, yes, was a headwind in the quarter relative to our expectations and I again want to make sure we couch it the right way. Full year we expect, still expect some growth from the business and have seen that, albeit we saw probably the most impact in North America where it actually had some declines in the quarter. The total organic though we expect to continue to be kind of low-single-digits for the year, this business for us is a really good business. It’s a place where we have a lot of high market share, margins are good, but at the same time the incremental profit flow through both on the upside and the downside are quite high. We have a high fixed cost in that market. A lot of vaults, hubs, people all over the world that really form that network. For us historically – with historic precious metals, highs and precious metals, particularly gold and silver and we even saw some more today actually, this is – this volatility or lack of volatility, let’s say in the last three quarters has not helped our business because when volatility occurs we tend to move metals. When prices are really high, there tends to be less demand with no volatility. So for us what we’re seeing today in the markets already hopefully provides some lift for Q4, but we’re not expecting any large bounce-back, or large decline going into fourth quarter and the rest of the year.

Thanks. That makes sense. And then free cash conversion looks like it’s going to be high-30s through the year and at the end of the prepared remarks, you mentioned getting back to the long-term framework. To clarify, do you think approaching I think near 50% long-term free cash conversion target could still be achievable in 2025, or would that component potentially take a little bit more time?

Yes. Hey Jasper, it’s Kurt. I would say, we still think it’s intact to eventually reach that, but we wouldn’t put timing on that. We continue to march towards that good version.

Okay. Last question for me, you mentioned the FX headwinds. Obviously, we are looking at a pretty big move in the dollar this morning. Should we think about what we are seeing this morning as potentially an incremental headwind versus 4Q, I guess absolute revenue guidance, if the FX move holds.

Yes. We would, this is obviously unprecedented move here this morning. But obviously it’s also tied to the election. And we think likely investors in foreign currencies are repositioning portfolios. And so let’s see where this – where it lands. But I would say a good way to think about it is, as we think about the rates that we have built into the guide, that it was a couple of weeks ago, right, when – at the end of the quarter. So, it’s not gotten better since then, in fact, it’s got a little worse. But let’s see after these things settle out.

Thanks for taking the questions, guys.

Thanks Jasper.

[Operator Instructions] The next question is from Tim Mulrooney from William Blair. Please go ahead.

Yes. Kurt, Mark, good morning. Thanks for taking my question. I just want to build off of the conversation you are having with Jasper. There real quick on the foreign currency, I think before and in second quarter, you are expecting a $65 million or so incremental headwind. Correct me if I am wrong relative your original guidance for the second half of the year. So, can you help me understand just exactly, okay, what that incremental headwind was for the third quarter, and now what you are expecting for the fourth quarter?

Sure. So, in total, we are expecting $100 million impact to the guide we had at the end of the quarter. In the last quarter, that incremental into the back half of the year is basically broken out between, sort of, let’s say two things, $50 million year-to-date through Q3 and another $50 million in Q4. And that’s the net numbers, Tim, based on kind of the ups and downs in the first half of the year.

Yes, that’s probably…

Exactly, we were a little bit positive in the Q1. Now and again, as we think about this, it’s largely the Mexican peso that we have seen and we saw in end of or in June, with the election there, when it moved sharply, which we talked about quite a bit last quarter. But again, today’s volatility, sort of is everywhere. And so I wouldn’t – we are not reading into that so much, more focused on, like I said, on what we know and kind of where we see the rest of the quarter based on that. Remember, Mexico is in – it’s in our Latin American segment, very profitable. So, the flow-through is pretty high, similar to what you would see in the segment margins. I think the thing to remember, particularly about Mexico is really still strong in Latin America, frankly, but strong operational performance that we had in the quarter, really year-to-date in those markets. So, there are still good businesses. Just this macro backdrop has become a bit troublesome here in the second half relative to currency.

Understood. And just last question on FX before we get to like, the fundamental parts of your business. Kurt, just so that I understand what your guide is based off of, is it, - so based off that traditional framework, I think you even said this in your prepared remarks, basically where you roll forward the foreign currency rates as of the end of the third quarter, so you are not prognosticating.

Yes and that’s right. That’s right, so the end of the third quarter, that’s where we snap the line on the rates. And the only one that we don’t treat that way is Argentina, but everything else is based on that end of Q3 rate.

And maybe kind of way to think about that is what we have in the guide is probably the low end of the FX impact, just given what we have seen today.

That’s where I was going with it. I mean you already know today or yesterday, even before the election results, I mean you already know that the rates have appreciated since then. I just want to make sure you are doing September 30th of like 21.9.

And that’s right.

Okay. So, we already know that there is a more of a headwind than the midpoint, okay, that’s enough. Beat that to death. Thank you. Getting on AMS and DRS, organic growth, 26% in the quarter again, is above what we were expecting. You guys consistently outperformed expectations all year here. I just kind of wanted to – I guess I was level set on a mid-teens or a high-teens organic growth rate for these businesses as we entered the year. Is that still where we – where the investment community should be anchored as we think about growth going forward, or are you feeling really good about that 20% plus growth rate given the performance year-to-date and the white space opportunities you got ahead of you.

Yes, great. That’s appreciated, Tim. Yes. So, we are surprised as we mentioned, this kind of mid to high-teens was what we thought would be. It’s better than that. Really started in Q2 we saw it again in Q3, which we had some nice wins and things we brought online. But just big things, it was a lot of little things that our teams globally are delivering. We talked about equipment sales being kind of an outsized impact in Q2. That wasn’t the case in Q3, we had some of course, but that wasn’t what the driver was. It really was just continued penetration of white space and conversions. As we think about kind of the role for it on four quarters, these are largely recurring revenue businesses. No reason to believe that one quarter of ‘25 to another of ‘26, wouldn’t continue for two more quarters. We have got a good backlog, certainly in Q3 of signings. Feel good about what we see in Q4. So, maybe the first half of the year, there is no reason we shouldn’t think that shouldn’t continue, and so we are more optimistic. I think the 15% to 18% is sort of with our long-term – our sort of medium-term view the next couple of years. We thought we had runway to do that. It’s proving that we are – maybe the value proposition is resonating the customers more, our right to win and our ability to execute on those opportunities is also getting better. And frankly we are, I think starting to get better at collapsing our time to revenue from bookings and signings with customers as well.

Well, all the FX conversation aside, that is incredibly exciting. And just one more for me, that the equipment sales that you mentioned, would that impact that 76%, does that drag it down to 25, 24 or…?

No. Not….

Not impactful?

Yes, not impactful at all this quarter in fact, on a year-on-year basis.

Got it. Okay. Well, thank you for taking my questions and good luck in the fourth quarter here.

Yes. Thanks Tim.

[Operator Instructions] And the next question is from George Tong from Goldman Sachs. Please go ahead.

Hi. Thanks. Good morning. In your global services business…

Hi. Good morning George.

Hi. Going back to global services business, can you talk a little bit more about how new leadership there could improve performance above and beyond what external market conditions might imply, and what the timing for when improved performance might look like?

Sure, yes. Thanks George. Again, we have talked about this business largely depends on kind of a global macro world around precious metals and currency and banknotes. But I think the other thing to think about is, it’s not – we are not helpless in improving our results. And we are not waiting for this to happen to us. I think the new leader now there that just joined us, really, I think we will have an opportunity to take a fresh look at the business. Take a fresh look at the end markets. Take a fresh look at how we attack those end markets, and how we cover customers, how we expand services. And I think this is always, healthy in businesses with leadership changes. I also think as we think about strengthening our operating cadence around these services, as well as the predictability around the future guidance and forecast we think will help as well, not it brings a pretty strong background from his past and really being able to set a strong agenda, and really being able to create a high say, do, relative to forecast and outlook. So, again, we are excited about that. I think the other is, I mentioned it in my prepared remarks. Nader also comes from other global companies as well , that can really help continue two big things. Really focus on improving our talent agenda and making sure that we are attracting the best people into the industry as well as strengthen our compliance culture. And this is something that we have talked about in the, previously, around making sure that we are doing business right and setting the right tone, not only with our employees, but with our customers and the rest of the market. And I know he is committed to doing that, and has done that in the prior – his prior life.

Got it. That’s helpful. And then separately, can you talk a little bit more about the $10 million in security losses that you saw in the third quarter?

Sure. We had a theft, George, that is ongoing investigation. We can’t talk about the specifics, but it’s a timing issue between Q3 and Q4 similar to what we saw publicly in Canada, last year with the gold theft. This was not that, but it was in – it was actually in Latin America. This is part of our business, part of our risk management profile. And as we have talked about in the past, we got to this sort of deductible, if you will, on our – with our insurance coverage and our self funding, and so we wouldn’t expect any more impact for the rest of the year.

Got it. That’s helpful. Thank you.

Great.

And ladies and gentlemen, this concludes our question-and-answer session. I would like to return the conference to Mark Eubanks for any closing remarks.

Thank you all for joining us today. We appreciate all your support and we look forward to speaking with you soon in the fourth quarter.

Thank you, sir. The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.