Brink's Company Aktie

Good day, and welcome to the Brink's Company First Quarter 2026 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded. I would like to turn the conference over to Jesse Jenkins, Vice President, Investor Relations. Please go ahead.

Thanks, and good morning. Here with me today are CEO, Mark Eubanks; and CFO, Kurt McMaken. This morning, Brink's reported first quarter results on a GAAP, non-GAAP and constant currency basis. Most of our commentary 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. We believe these measures allow investors to better compare performance over time and to evaluate our performance using the same metrics as management.

Reconciliation of non-GAAP results to their most comparable GAAP results are provided in the SEC filings, which can be found on our website. We will also have commentary on the status of our pending acquisition of NCR Atleos. As a reminder, this transaction is subject to the completion of customary closing conditions, including regulatory approvals and approval by Brink's and NCR Atleos shareholders. Additional details, including risk factors related to the transaction can be found in the pertinent SEC filings. I will now turn the call over to Brink's CEO, Mark Eubanks.

Thanks, Jesse, and good morning, everyone. Starting on Slide 3. We're pleased with another strong quarter of growth and operational execution as we continue to transform Brink's into a more predictable and profitable enterprise. I want to thank all of our team members, especially those in the Middle East region, for their focus in this dynamic global economic backdrop. I could not be more proud of our teams for staying focused and delivering on our Q1 commitments. Our results were at the upper end of our first quarter guidance ranges, and we're off to a strong start to the year.

First quarter revenue growth of 10% included 4.5% organic growth, driven mostly by 15% organic growth in ATM Managed Services and Digital Retail Solutions or AMS/DRS. The growth in the quarter was highlighted by the onboarding of Pandora in DRS and good momentum in AMS, especially in the Rest of World segment. At the segment level, Rest of World delivered 7% organic growth on strong precious metals activity in the global services line of business. Overall, organic growth, favorable revenue mix and good underlying productivity drove margin expansion of 10 basis points with over 100 basis points of expansion in both North America and Rest of World and 240 basis points of expansion in Europe.

In total, Q1 EBITDA was $238 million with a margin of 17.3%, trailing 12-month EBITDA was $1 billion for the first time in our history this quarter, reflecting a more than $200 million increase since the end of 2022 as we continue to deliver profitable growth across our business. We also continue to improve cash generation with an increase of $66 million year-over-year in the first quarter. On a trailing 12-month basis, free cash flow exceeded $0.5 billion for the first time in our company's history with conversion from EBITDA of 50%. Operationally, we saw improvement in both days of sales outstanding and days payable outstanding.

Coupled with EBITDA growth I mentioned earlier, total free cash flow has more than doubled since year-end 2022, with free cash flow now exceeding $12 per share. As I review the quarter, we delivered on our commitments with results at the top end of our guidance range. As I mentioned, I'm proud of our consistent execution during volatile market conditions and our team's focus on the heels of the announcement of our transformational acquisition of NCR Atleos. Supported by this strong first quarter, I remain confident in our ability to continue our trajectory and deliver our full framework for 2026.

Turning to Slide 4. You can see the components of our value creation strategy, which remain unchanged for 2026 and are well aligned with the strategic rationale of the NCR Atleos acquisition. We expect organic growth in 2026 to remain consistent in the mid-single digits, driven primarily by new and converted customer growth in recurring AMS and DRS revenue, which is expected to approach 1/3 of our total company revenue by year-end. The acquisition of NCR Atleos is expected to accelerate our ability to capture these AMS and DRS customers by delivering a more vertically integrated AMS offering and lowering our cost base through increased network density on the retail side of our business.

On a stand-alone basis for 2026, we expect EBITDA margins to expand by 30 to 50 basis points as we shift revenue to these higher-margin services and drive cost productivity across our operations. This mix shift is expected to continue after completion of the acquisition and cost efficiencies are expected to accelerate behind the $200 million of cost synergies that we previously identified as we eliminate duplicative SG&A and public company costs, optimize our service delivery network and finally, drive global procurement savings.

Both companies have delivered meaningful improvement in cash generation over the last few years, and we expect that will compound as we combine our 2 businesses. In addition to working capital improvements, we've already completed a secured financing arrangement that will allow us to absorb the $1.6 billion of NCR Atleos bank debt at a rate that is more than 1 full percentage point better than their current level. While we're focused on the near term on reducing leverage, we expect to produce a combined $1 billion of free cash flow from the 2 companies, providing flexibility to maximize value creation through strategic investments and shareholder returns.

Shifting back to the quarter on Slide 5, I'll provide some commentary on performance by line of business. Starting with Cash and Valuables Management, or CVM. Organic growth was 1% in the quarter with good pricing discipline offsetting a couple of percentage points of AMS/DRS conversions. Our Global Service business was also strong again this quarter despite lapping a robust first quarter of 2025. Precious metals movement remain volatile and trends can change rapidly, but we factored in the current favorable trends into our second quarter guidance. AMS/DRS revenue grew organically approximately $50 million in the quarter for a rate of 15%. This was the 13th consecutive quarter of at least 15% organic growth in AMS/DRS as we continue to build momentum in these important businesses.

It's important to note that in the fourth quarter of last year, we saw strong growth related to onetime equipment sales, primarily in North America that impacts the sequential comparisons. Factoring in this dynamic, growth in the quarter was in line with our expectations and positions us well to deliver our guidance for the full year. In DRS, we continue to see positive momentum with large enterprise customers in North America, including the onboarding of Pandora during the late fourth and early first quarters.

In AMS, we're lapping some large wins in the prior year like Sainsbury's, while we stage for other large deployments, including some in the Rest of World segment. We continue to see positive AMS trends with banking customers, including in Southeast Asia, where we recently won the largest national bank in Indonesia with about 5,000 ATMs. Looking to the balance of the year, we expect AMS and DRS to accelerate sequentially, supported by our strong pipelines and DRS backlogs, including Paradies that will lead us directly into the next slide.

On Slide 6, I'd like to highlight an example of the type of wins we're delivering with DRS. Paradies is a leading travel retailer and restaurateur, operating over 700 stores in airports across North America. They offer major brands like Chick-fil-A, Tumi, Starbucks today and Jimmy John's just to name a few. Paradies came to us to help solve common dilemmas they see across large global retail and quick-serve organizations. I've often discussed DRS as a true win-win for both Brink's and retailers, and that's clearly the case here with Paradies. We designed a bespoke solution incorporating both front office recyclers and smart safes that integrate directly with Paradies POS software.

Our solutions are expected to help them with several pain points across their global footprint. Among other things, we're able to reduce cash handling time for managers and employees, unlocking productivity and efficiency within their stores. Our solution digitizes cash quickly and tracks transactions down to the teller level, reducing operational shrink across the business. We are also able to simplify service delivery for customers as we shift our key quality service deliverable from arriving within a certain appointment window to providing overnight electronic deposits for faster access to working capital. This shift creates flexible routing and scheduling options for Brink's, allowing us to arrive when needed or when easily added to an existing scheduled trip into the area.

We completed a successful trial phase with Paradies and are planning for the full rollout across their entire footprint over the balance of the year. While the solution we designed for Paradies is unique to their specific needs, the problems we're solving for customers are universal. Our DRS offerings have a clear and demonstrated value proposition for retailers of all sizes. As we close more of these deals, I remain confident that we're in the early stages still of our efforts to expand our DRS business across the retail landscape in all geographies that we serve.

On Slide 7, you can see our methodical progress towards 20% EBITDA margins in North America. In Q1, EBITDA margins in this segment expanded by 170 basis points year-over-year, driving trailing 12-month margins to 19.5%. Revenue mix has been a big contributor to this progression. It was another great quarter of AMS/DRS growth in North America as we continue to convert customers and install new DRS units, including the Pandora win that we mentioned last quarter. Global Services revenue growth was also strong this quarter despite an elevated prior year period comparable. Our shift to higher-margin flexible service recurring revenue is unlocking operational productivity across the business.

Over the years, we've improved and standardized our service delivery network to enable profitable growth. This improvement is clear in the numbers as we continue to deliver improvements in revenue per vehicle and labor as a percentage of revenue. This is setting the stage for continued momentum post closing of our NCR Atleos acquisition as we layer on additional volume to our more efficient network. I'm confident increased scale will position us to drive further expanded margins well beyond our preliminary 20% targets.

Turning to Slide 8. I'd like to provide a brief update on the NCR Atleos transaction. While we've been publicly engaged with shareholders over the last 8 to 10 weeks, we've been working hard diligently behind the scenes to progress this transformational acquisition forward. At the end of March, we successfully completed a refinancing of the secured portion of the bridge loan, increasing our capacity while unlocking attractive rates and improving certain conditions in our credit agreement. Just last week, we filed our registration statement and are progressing towards a shareholder vote over the next few months.

We're making good progress on the regulatory front as well with filings submitted in many jurisdictions and reviews progressing as expected. NCR Atleos first quarter results will be filed after the market closed today, and we understand them to be in line with our business case modeling and on track with our full year projections. Though NCR Atleos will continue to operate independently until closing, we expect our integration management team to work closely with NCR Atleos to plan and prepare for the execution of the potential cost synergies.

Importantly, we've created a dedicated integration management team within Brink's that is isolated from the day-to-day operations of our business and will be responsible for driving program execution of cost synergies after closing. While we're still in the early process in many ways, we're making good progress and continue to expect closing will occur by the end of the first quarter of 2027. The more we interact with our internal teams, our customers and the NCR Atleos management teams, the more encouraged I am by the potential of this combination. Supported by strong momentum in AMS and DRS and ATM as-a-Service, it remains clear that this is the right strategic direction at the right time to accelerate our growth and bolster our business for the future.

Before I hand it over to Kurt to walk through the financials, I want to thank our team for embracing the power of our strategy. We've lifted our performance by consistently delivering on our external commitments while improving our service levels to our customers, even redefining the definition of what service quality means. Our team is focused on continuing our efforts to move the business forward behind AMS/DRS customer offerings that deliver clear win-wins for both the customers and for Brink's.

I'm encouraged by the strong results we delivered, the strong momentum supporting us and I'm even more optimistic about the future potential as we combine with NCR Atleos and position ourselves to accelerate growth, profitability and value creation. And with that, I'll hand it over to Kurt to discuss the financials, and I'll come back for Q&A. Kurt?

Thanks, Mark. I'll begin on Slide 10 with a look at Q1. Revenue increased 10% with 5% constant currency growth and a 6% tailwind from foreign currency. Adjusted EBITDA was up 10% to $238 million with operating profit up 12%. Both operating profit and EBITDA accelerated 10 basis points year-over-year on favorable revenue mix, pricing discipline and productivity in both labor and fleet. Earnings per share was $1.80, up 11%.

In the quarter, we completed approximately $30 million of share repurchases prior to the NCR Atleos acquisition announcement, reducing outstanding shares by 5%. As Mark mentioned earlier, trailing 12-month free cash flow was $502 million at the end of the quarter, representing conversion of 50%. I would like to call out that we have enhanced our cash flow disclosures to highlight cash flows related to the NCR Atleos acquisition, which were $2 million in the quarter and are expected to be between $50 million to $60 million for the full year. We believe it is important to isolate these cash flows for investors so they can get a better picture of the true underlying cash generation of the business.

These cash flows are included in our expectations to get to approximately 2.3x by the end of 2026. Similar to timing from the prior year, we are currently ahead of our full year cash conversion guidance after Q1. We expect the timing of certain cash tax payments and cash investments over the balance of the year to return us to our target level of 40% to 45% by the end of the year. On Slide 11, total organic growth was $56 million or more than 85% of the growth came from higher-margin subscription-based AMS and DRS.

The $8 million of CVM growth was in line with expectations and represents volume growth in Global Services and strong pricing execution, partially offset by the conversion of customers to AMS and DRS. FX contributed $71 million of growth in the quarter with favorable year-over-year rates primarily in the euro and Mexican peso. Shifting to the right side of the slide, growth of $128 million generated $23 million of EBITDA, expanding margins by 10 basis points. As you will see from our guidance for Q2, we expect expansion to accelerate into the second quarter as we continue growth into AMS and DRS.

Moving to Slide 12. Starting on the left. Operating profit was up $18 million to $168 million with a margin of 12.2% on strong productivity, pricing and line of business revenue mix. Interest expense was $64 million in the quarter, up about $6 million year-over-year and in line sequentially with the fourth quarter. For the full year, interest expense is expected to be just over $250 million using current interest rate expectations. Tax expense was $29 million in the quarter, representing an effective tax rate of 27.6%, in line with the prior year rate. Interest income and other was down $6 million year-over-year, primarily due to lower interest income related to the prior year repatriation of cash from Argentina.

Income from continuing operations was $75 million. Depreciation and amortization was $64 million, primarily reflecting increased depreciation from growth in AMS and DRS equipment. In total, first quarter adjusted EBITDA was $238 million, up $23 million year-over-year with margins expanding 10 basis points. Let's move to Slide 13 to discuss our capital allocation framework. Our capital allocation framework has remained consistent during Mark and my tenure, including through our transformational investment in NCR Atleos. Our leverage at the end of the first quarter was 2.7x net debt to adjusted EBITDA.

During 2026, we expect net debt leverage reduction to be the primary focus of our capital allocation as we position our balance sheet for the NCR Atleos acquisition. Over the year, we expect to reduce our stand-alone leverage to approximately 2.3x. While we expect leverage to be approximately 3.4x, assuming Q1 2027 closing, we are currently expecting to be below 3x by the end of 2027. We continue to believe that 2 to 3x is the right leverage to balance capital efficiency and appeal to existing and potential equity investors.

Our capital allocation framework has generated meaningful shareholder value over the last several years. The growth acceleration potential into high-margin recurring revenue AMS and DRS is expected to continue to drive margin expansion and compound cash generation for years to come. With clear line of sight to a combined free cash flow of $1 billion, we expect to have the flexibility to make strategic investments and return capital to shareholders in the future.

Moving to guidance on Slide 14. Our framework for 2026 remains unchanged. We expect to deliver mid-single-digit total organic growth, supported by mid- to high teens organic growth for AMS/DRS. Using rates as of yesterday, we are currently expecting to see an FX tailwind for the full year of between 2% and 3%. EBITDA margins are expected to expand between 30 and 50 basis points with conversion of EBITDA to free cash flow of between 40% and 45%.

In the second quarter, we expect revenue between $1.37 billion and $1.43 billion, reflecting organic growth in the mid-single digits. Using yesterday's spot rates, FX is expected to be a year-on-year tailwind of just below 3% at the midpoint. Adjusted EBITDA is expected to be between $245 million and $265 million, reflecting 10% growth and margin expansion of approximately 40 basis points at the midpoint. EPS is expected to be between $1.85 and $2.25. And with that, we are happy to now take your questions. Operator, please open the line.

[Operator Instructions] The first question comes from George Tong with Goldman Sachs.

In DRS, can you perhaps quantify how much of the growth came from conversion of traditional cash-in-transit customers versus greenfield wins?

Yes, sure. We have -- again, George, a good quarter for us in Q1 kind of everywhere in DRS. But particularly as you think about convergence, again, we stay on track what we've seen in prior quarters. So about 1/3 of the installs really coming from conversions of existing customers, which, as we've talked about previously, gives us a little bit of headwind in CVM, but of course, get the benefits of the better margin and certainly recurring revenue.

The 2/3, though, really, we continue to be excited about because these are new customers that are either unvended or were previously vended by some other solution. You can see -- we talked about the Pandora deal a little bit in the call. We had it in our presentation last quarter, where we were able to really provide an enterprise solution for a customer that we were able to identify, negotiate and deploy fairly rapidly to collapse our time to revenue. We didn't get a chance to talk about it much last quarter, as you know, given the deal announcement. But if you look at, again, this quarter, another really nice deal here with Paradies, that's one of the airport operators for food and quick serve and retail.

And again, just the opportunity to work with customers like that to provide a unique solution, whether that's leveraging hardware, software, POS integration and even some of our cash forecasting and balancing software really allows us to tailor a solution to almost any retail environment as we look to streamline and optimize the total cash ecosystem inside these retail stores. And this is something we'll continue to see going forward.

Very helpful. And then you expect AMS/DRS growth to accelerate sequentially given the strong backlog. What are your latest thoughts on what sustainable medium-term AMS/DRS growth can be?

Sure. I think -- we think this mid- to high teens organic growth will continue, George, here, certainly this year. And I don't know what your medium term is, but we've got a view as we go into '27 and get this deal closed, we can do -- continue to accelerate that more. So we're excited about it. And I think if you look at our backlog coming out of Q4 into Q1, team is excited about what we've got lined up for the second half of this year as we're installing those in Q1 as well as Q2. But you can see the organic growth rates are continuing.

Although we were a little bit higher in Q4, about 22%, as we mentioned previously, we had a pretty significant amount of equipment sales, particularly in North America. But even that was still in the high teens from an organic perspective, and that continued into Q1. Q1 is typically a little bit lighter just given the fact that we don't do a whole lot of installations during Q4 retail season because most of our retailers are -- it's a busy season, particularly North America and Europe, where they don't want us in their stores installing. So we tend to carry a good backlog into Q1 and Q2.

The next question comes from Tobey Sommer with Truist.

I'd like to double-click on AMS and DRS again. How would you describe the geographical differences you're seeing in customer uptake and demand? And then what do you think it takes to light a fire under financial institutions in North America for this to take off?

Yes. Good question, Tobey, because we're really starting to to see more broad AMS/DRS growth around the world. And you can see, particularly in Latin America in the quarter, we're seeing Mexico continue to have a good run here in DRS that is allowing us to not only convert customers, but continue to improve margins and build out an installed base. We're seeing that in Argentina as well. And then, of course, in Brazil, we've been having success, and that continues. We're seeing more AMS and DRS, but particularly, I called out AMS in the Rest of World segment, which is really good because these are big cash markets that are kind of much earlier cycle when it comes to AMS/DRS conversion.

But last quarter, we talked about AMS Security Bank down in the Philippines that we're currently deploying. We also then talked this quarter about Indonesia, although we've had some success in Indonesia previously. This is a pretty big deployment there. So we feel good about that. We're seeing banks in Rest of World as well as Latin America continue to either make decisions or continue to look at better ways to serve their continued ATM needs. If we move to the Northern Hemisphere, Europe and North America, of course, Europe is our most highly penetrated AMS/DRS market.

And again, a good -- continue to have good progress there and a good outlook as we think about Q2 and Q3. But North America, certainly, our DRS trajectory continues to go higher. And you see it in our margins, and I called it out in the North American deep dive there, we continue to see the good mix benefits from DRS, particularly as we see going forward. The last part of your question was around North America banks, particularly U.S. banks. And that's something that we're continuing to have lots of discussions. And as we think about the services across the entire continuum for ATMs and ATM managed services, we're starting to get up those opportunities.

And whether that's some of the off-branch bank at work ATMs or whether that's specific services and/or managed services on the on-branch, the full outsourcing continues to be a little slower than -- certainly a lot slower than the Rest of the World. I think this is one of the things that we think about with the Atleos acquisition, Tobey, and getting to a full vertical solution where customer outcomes can be better controlled and I think create more confidence with those customers about a full outsourcing. And so this is something that we're keenly aware of and thinking about and certainly part of our long-term thesis on the business to support both growth and being a catalyst for those banks to do outsourcing as well as increasing our density and participation in our retail footprint.

If I could ask a specific question on DRS. Is this -- are you finding this service is more valuable or less valuable to customers based on their business models as sort of like, I don't know, a stand-alone big box as opposed to an area like in an airport where retail is clustered or a mall because you've had a couple of marquee customers that you can talk about that sort of fit that latter bucket.

Yes. I'd say it's more about the idea around disclosure, Tobey, and customers being willing to talk about it, to be honest, because we are seeing DRS, we don't get to highlight all of our DRS wins as we've talked about previously in retail. But we're seeing strong value propositions, everything from the SMB mom-and-pop coffee shops all the way up to the big box guys. And many of those solutions can look similar maybe in the middle of that bulge. But when you get to the smaller or you get to the larger, they're certainly more sophisticated and can be more complex.

We think the complexity is helpful for us because we can solve some of those problems with more technology and an integrated service model. And then on the low end, on the smaller customers, we're able to, frankly, lower our cost to serve to allow us to provide a better value proposition as we build more density. And as I think about one of the other big opportunities, and we talked about that last earnings call about the Atleos integration is building out more density across our network that again is going to lower our cost to serve and ultimately be able to provide better value propositions to customers, both small and large, but ultimately provide a much more compelling solution than they're able to either self-perform today or even than what we can deliver today from a cost perspective. So again, those benefits continue to accrue, and we think there's a definite network effect that we can create as we build out that density.

If I can ask one last one, and I'll get back in the queue. With respect to cash, conversion from EBITDA. You had some numbers in your recent filing that gave us a look at what your expectations are for a number of years for stand-alone Brink's. But maybe you could touch on the opportunity or what the combination with NCR Atleos does to the opportunity to increase that conversion over time.

Yes. Tobey, it's Kurt. Maybe I'll jump in here. I would say, first of all, just from a profitability perspective, certainly an opportunity there. The synergies will help on flow-through for sure. Then you go below the OP line and below the EBITDA line, we definitely see opportunities in terms of capital efficiency from both the CapEx and working capital perspective, and we talked a little bit about it. I mean we have to obviously develop that further together, but certainly see opportunities there to drive increased conversion on that.

I think the other area, Tobey, is that we think about, and frankly, we're seeing benefit now in our business as we really ramped up our efforts in and around global supply chain and procurement is getting better payment terms as we operate as one large enterprise versus 52 countries. And we've talked about that transformation that's been going on in the business for some time. We're really starting to see some of those benefits. And we think that putting together 2 companies of similar size and scale and purchasing power would only help that in the future as we think about managing payment terms, managing our balance sheet, managing our receivables in the same way as we think about common customers.

So the working capital benefits that we're achieving -- sorry, improvements we're achieving now. By the way, Atleos is doing a pretty good job of that, too. We think only together can we really drive not only kind of in contract changes, but also just efficiencies in our systems and better follow-up and operational execution on credit and collections and payment terms.

And maybe I just might add that's a good point, Mark, one other thing. If you look at cash interest and cash taxes, there'll be opportunities there as well with the combined firm. And so that's another final area.

The next question comes from Tim Mulrooney with William Blair.

This is Sam on for Tim. Maybe I'll pivot away from some of the AMS/DRS questions, some good ones were already asked and ask more about your Latin America business actually. So this year, you'll be moving past some of the Argentina inflation impacts for the first time in a while. So how are you thinking about the growth rate and margins for this business? And then I noticed a competitor of yours just made a pretty sizable acquisition in Peru. Curious how this might impact the level of competition you face in this region.

Yes. Thanks. Good to hear from you. First of all, I'll address the Peru acquisition. We're not in Peru. Actually, we were in Peru years ago and actually exited the business -- exited the country. But for us, we're -- we're very comfortable with the geography we have today. And as we've talked about previously, our strategic focus is really about moving further up the stack around DRS and AMS more around technology and service efficiency versus really expanded geography. Now we will have some expanded geography or we expect to have some expanded geography post the NCR acquisition that will allow us to kind of reassess what resources we have in which markets and how best to optimize cost and the supply chain there.

But for us, again, this wasn't much of a strategic lever for us. We didn't have any cost synergies there because we don't have any businesses there to combine. And really, the market is pretty isolated from our perspective. So we don't see that competitive pressure, let's say, in the region from this acquisition, particularly. More generally, we love Latin America from a fundamental perspective, high cash usage in these markets, good margins. We have good businesses, good leadership teams. And as you point out, Argentina is a place as you look at the kind of FX trends here in the last 6 months as we get to the back half of the year at current rates.

Argentina is not a headwind at all. And so from an FX perspective. So that's really interesting because it's a good business for us. We have a good position down there, and it's good margins. And so as we think about going forward, it's going to be less noise and effectively will be something that investors will be able to get a better look at on an apples-to-apples basis without as much noise. The other thing that we think about also down there is the AMS market. It's a huge ATM market, and we're in the biggest markets down there in Brazil, Argentina and Mexico, Colombia, Chile.

And certainly, there's activity already going on down there. We've talked about it, but there's a lot left to go. And the banks down there are pretty sophisticated operators. They are relatively consolidated. And so the discussions are progressing well, we have several active networks down there as well as active pilots with existing banks that we're working to convert here in '27 and '28 -- I'm sorry, '26 and '27.

Sam, just I'd add too. I mean, you should expect the margins to get better sequentially, and that's what we're seeing.

Yes. I think it's -- and Sam, just of note, as you look at our Q1 performance and Q2 guide, this $10 million to $11 million of EBITDA that's above -- was above the midpoint of our guide of our framework should flow through to the balance of the year. And that's -- part of it is this LatAm margin improvements. And as you can see, the EBITDA margins are benefiting in Q1 kind of over our midpoint at the high end of our guide for a couple of reasons. One is the continued AMS/DRS mix benefits, but also we had a strong quarter in BGS. And our Global Services business, I mentioned on the call, given the -- all the volatility in the Middle East that we've seen, there's been a lot of movement of precious metals around the world.

And in and out of all of the big financial centers around the world, that likely -- in our guide, we assume that's going to continue into Q2. And as we look out to second half, these markets are volatile. Hopefully, we'll have peace by then and things will settle down. And we're not assuming the kind of that same performance in the back half that we've seen in Q1.

So if you think about progression, Sam, it's very typical to look at kind of a 45% of our EBITDA in the first half, 55% in the second half is very typical for us. We're a little bit ahead of it this year. And as Mark said, we see that flowing through for the year. So I think good start.

Got it. Super, very helpful. And I was going to ask about BGS next, but you already beat me to it there. So maybe I can leverage this next question and maybe address fuel prices. I think I know that your contracts generally have fuel surcharges that are rent into them. But I guess I'd be curious if that's actually captured the full impact that you're seeing right now. And if there's any impact to margins that you might expect for the remainder of the year from this?

Yes. So we've been -- you know it well. We've been pretty good at ensuring that fuel doesn't necessarily impact us over the long term adversely. Of course, those indexes and changes, some are monthly, some are quarterly, some are biannually, whatever that we recapture that. But if anything, maybe it could be delayed a quarter. But those -- the fuel prices were in -- we had them in Q1, and you can see our performance, again, was way above our midpoint and at the high end of the guide. So we think that our teams have been pretty good at covering that and ensuring that our pricing discipline maintains those margins.

If we go forward we see that likely to be a blip. Some of the things we -- some of the stuff we've seen around the world, we heard about some of these interruptions and fuel and so forth. We haven't experienced that. We haven't experienced it in anything other than episodically, let's say, okay, airports were closed in Dubai for a bit. But other than that, we really haven't had any real kind of structural supply impact and aren't expecting that going forward.

Yes. So in our guide and our framework contemplates that, Sam. So we've been good about covering it and still feel good about continuing to cover it.

Well, thanks. Listen, we appreciate everyone's time. I appreciate your support and interest in the company and look forward to speaking with you either next few days or when we're on the road at conferences coming up here in May and June. Have a great day.

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

Good day, and welcome to the Brink's acquisition of NCR Atleos. [Operator Instructions] Please note this event is being recorded. This call and the Q&A session that follows the call will contain forward-looking statements. Actual results could differ materially from projected or estimated results. in particular, forward-looking financial information for the combined company is inherently uncertain due to a number of factors outside of Brink's and NCR Atleos' control.

Information regarding factors that could cause differences in actual results are available in today's press release and presentation and in Brink's and NCR Atleos' SEC filings. The information presented and discussed on the call is representative of today only. Brink's and NCR Atleos assume no obligation to update any forward-looking statements. The call is copyrighted and may not be used without written permission from Brink's and NCR Atleos. I will now turn it over to your host, Jesse Jenkins, Vice President of Investor Relations. Mr. Jenkins, you may begin.

Thanks, and good afternoon. Here with me today are Brink's CEO and CFO, Mark Eubanks and Kurt McMaken as well as NCR Atleos President and CEO, [ Tim Oliver ]. This morning, a joint press release was issued and both companies filed 8-Ks with pertinent details of the proposed $6.6 billion acquisition of NCR Atleos by Brink's. The transaction is subject to the completion of customary closing conditions, including regulatory approvals and approval by Brink's and NCR Atleos shareholders.

Additional details, including risk factors related to the transaction can be found in these filings and on both companies' websites. This afternoon, both companies also reported fourth quarter and full year 2025 results on a GAAP and non-GAAP basis. Any reference to non-GAAP financial measures during this presentation are intended to provide investors with a supplemental comparison of Brink's operating results and trends for the periods presented.

Brink's believes these measures allow investors to better compare performance over time and to evaluate its performance using the same metrics as management. Reconciliation of Brink's non-GAAP results to its most comparable GAAP results are provided in its earnings release, the appendix of its earnings presentation and the related Form 8-K filing, each of which can be found on Brink's website.

While most of today's call will be focused on the transaction announcement, we and the NCR Atleos Investor Relations team will be happy to follow up with any questions related to earnings results. I will now turn the call over to Brink's CEO, Mark Eubanks.

Thanks, Jesse. Good afternoon, everyone. Before I speak to the exciting transaction we announced today, I'll briefly touch on the strong fourth quarter and full year 2025 results, which were at or above the midpoint of our guidance on all metrics. We delivered another year of meaningful strategic progress with strong organic growth from ATM Managed Services and Digital Retail Solutions while expanding our adjusted EBITDA margins by 40 basis points, and importantly, delivering $436 million of free cash flow.

Our normal detailed quarterly results presentation, including our Q1 2026 guidance and full year framework can be found on our investor website. As Jesse mentioned, we'll be happy to answer questions and provide additional details on our 2025 results and 2026 stand-alone guidance when we meet with analysts and investors in the coming days.

Moving on now to the news of the day. We're excited to announce that we've agreed to acquire NCR Atleos bringing together 2 complementary trusted and globally recognized financial technology infrastructure provider

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To unlock productivity and improve service quality under a managed services or full outsourcing model. We'll be able to solve any ATM owners' needs through a better optimized cost structure that will provide compelling value propositions for customers as they look for outsourced solutions for increasingly complex and costly systems and processes. As we already see in Europe, many governments are exploring options to require banks to maintain cash access points.

Our ability to reduce cost of ownership for banks without sacrificing service quality is vital to ensuring cash access for end consumers in an increasingly digital world. Through existing global partnerships and service relationships with many leading financial institutions, we believe our combined capabilities will drive further penetration into the growing and evolving addressable market as more ATM owners look to reduce costs by capitalizing on higher agencies.

On to Slide 7. Beyond direct ATM management for financial institutions, I want to take a minute to outline how this combination supports our growth aspirations in the retail channel as well. We both believe this acquisition presents significant opportunity for our DRS business, Today, Brink's and NCR Atleos, both manage ATMs inside of retail locations around the globe.

For NCR Atleos, this often involves a subcontracted provider performing cash logistics services. And for customers, this often involves multiple vendor relationships to manage different types of services within the store. Often, when we service these locations, we see many other vendors operating in and around the payments ecosystem, from ATM replenishment to cash coordination at the register to first and second line maintenance of devices. This is obviously inefficient and costly for our retail customers and ultimately, the consumer.

Our combined business will be able to safely and securely streamline the entire cash and payments ecosystem, ultimately optimizing our cost structure. With a digitally connected DRS device and a fully monitored ATM, we can reduce our trips to the store while improving service levels and cash flow for the retailer. This is a win-win for retailers across the globe who are continuing to look for automation and reduce costs for all their payment systems. This is also a win for consumers that want a convenient access to cash and ubiquitous acceptance of cash at retail stores.

While this level of optimization will take time, the addition of NCR Atleos capabilities pulls forward our ability to capture this potential market. Beyond this compelling retail opportunity, bringing NCR Atleos large globally installed base of over 600,000 ATMs into our broader network will help densify our routes and improve our labor and capital efficiency around the world.

Route optimization has been a priority for Brinks, especially in North America, where we were able to increase revenue per vehicle by 14% in 2025. Building off its early success. This combination will increase the density of our networks and enable us to continue to improve productivity and asset utilization. This productivity will allow us to offer a more competitive offering across nearly any business, moving us into previously untapped markets from large retailers down to small- and medium-sized businesses.

Now I'd like to turn this over to Kurt to talk about some of the economics of the deal.

Thanks, Mark. Beyond the strategic merits Mark spoke about, we expect significant financial benefits from the combination. In terms of synergies, we expect to add $200 million of annual run rate synergies to the business. Our goal is to fully realize those synergies within 3 years, and we expect that the cost to capture will be roughly 1:1.

We have identified 3 major buckets of these synergies with over half coming from duplicative SG&A costs. Our service network and infrastructure overlap is expected to produce approximately $70 million in savings and combining our purchasing power should contribute another $25 million in procurement savings.

It's important to note that while we expect some level of additional revenue synergies from cross-selling like the integrated AMS DRS offering, Mark just mentioned, none of those synergies have been factored into the expected synergies discussed in the presentation.

Over the course of the next 12 months before closing, we will continue to work to refine these estimates and explore other potential avenues of savings. We're well positioned to unlock substantial value that sets the foundation for consistent long-term value creation. That value creation begins with the impressive cash generation potential the combination provides.

In 2025, the 2 companies generated $762 million in free cash flow converting 42% of the combined adjusted EBITDA. Both companies have capital efficiency and working capital optimization initiatives that are driving consistent improvements in cash generation.

Combined, we will be able to continue to make progress in these areas. Looking out over the next few years, we have line of sight to over $1 billion of annual free cash flow, creating significant capital flexibility to execute our capital allocation priorities of investing in the business, reducing debt and returning capital to shareholders.

We expect this acquisition to take about 12 months to complete. During this period, both companies will shift capital allocation towards net debt reduction working towards a targeted range of 2 to 3x adjusted EBITDA. With the amount of cash expected to be generated by the combined company, we don't expect it to take long to reach our targeted debt levels by the end of 2027.

Once we have achieved our targeted [ debt ] range, we fully expect to pivot capital allocation to shareholder returns. Before I turn it back to Mark, a quick review of the transaction details. We are purchasing NCR Atleos for an implied value of approximately $6.6 billion, composed of $30 per share in cash consideration and 0.1574 shares of Brink's for each common share of NCR Atleos. The cash component of the deal will be funded by cash on hand as well as a fully committed bridge facility, which we have already secured.

As previously discussed, we expect to recognize $200 million in annual run rate synergies within 3 years, and this deal is expected to be at least 35% accretive to EPS in year 1. As I mentioned, we are targeting for the combined company's net debt leverage to return to 2 to 3x by the end of 2027. The transaction is expected to close in the first quarter of 2027, subject to customary closing conditions, including regulatory approval and shareholder approvals from both companies.

Before we open the line for questions, let me send it back to Mark for some closing remarks.

Thanks, Kurt. As I close our prepared remarks, I wanted to emphasize how this deal accelerates our previously stated value creation priorities. Our first focus is to grow our business organically. While this transaction adds significant inorganic growth, we expect the combination to further solidify our long-term organic growth framework in our already fast-growing AMS and DRS customer offerings.

In ATM Managed Services, we will deliver improved capabilities across every touch point in the ATM ownership value chain, allowing us to further advance customer outsourcing opportunities and drive higher revenue per ATM as we progress our customers up the value chain to more efficient service options.

On the DRS side, we see additional opportunities to grow our business with a holistic cash payment ecosystem that integrates our AMS and DRS capabilities. From a profit perspective, we expect our margins will benefit from the $200 million in annual run rate synergies, but we will also see considerable productivity improvements as we optimize our routes within denser networks and cross-training technicians to provide multiple services to customers.

We also expect to continue ongoing lean waste elimination programs at both companies as our existing continuous improvement initiatives continue to mature. We previously discussed the accelerated free cash flow potential of the business.

Beyond the additional cash from synergies, we still see many opportunities with inventory, receivables and payables to continue to shorten the cash cycle as we move towards combined free cash flow generation of approximately $1 billion.

And finally, all these efforts drive our overall goal of maximizing shareholder value. With net leverage expected to reduce below 3x by the end of 2027, we will be able to quickly pivot capital allocation toward capital returns as we find accretive ways to deploy our cash that generates lasting value for our expanded shareholder base. As you can see, this deal is complementary to our stated value creation objectives and fits nicely within our previously discussed capital allocation framework, with a quick delevering into our targeted range in less than a year.

With sound strategic logic that will enable growth, cost efficiencies and compelling deal economics, we expect this deal to advance our value creation efforts as we move forward together. And with that, we're happy to now take your questions. Operator, please open the line.

[Operator Instructions] The first question comes from George Tong with Goldman Sachs.

You mentioned you expect $200 million cost synergies from this transaction. Can you provide more details on where you expect this $200 million to come from, how much from routing, from the fleet, from overhead? Just some additional details would be great.

Yes, sure. Thanks for the question. I think this deal -- the financial returns sort of speak for themselves and the synergies are certainly part of that. But this is really a strategy first story and a number of story second. The combination accelerates really what already what we're doing in AMS and DRS and allows us to build on that momentum as we build out these complementary capabilities up and down the value chain.

I think it also highlights the area of focus here that we're strengthening the highest return growth area in our business is AMS DRS. And this is mainly focused on the fact that we continue to see more and more opportunities with both banks and retailers looking to outsource cash management, either through ATM outsourcing or through I think the synergies are just on top of that and clearly help us underwrite the value creation levers across this -- across the deal and across the economics. Maybe, Kurt, you want to talk about the synergy specifically.

Yes, George. So look, first of all, the $200 million in annual run rate synergies we're expecting to be hitting in the third year. Look, we have a lot of confidence in. We've really worked hard to develop these together. As you can see in the presentation, a little bit over $100 million in the SG&A area. And we really see that very attractive to be able to get to those pretty readily and easily.

The next biggest component is in our shared networks. The reality is we do have a lot of shared network resources that we have the ability to really optimize together and then procurement and just really realizing the benefits of much larger and leverage spend across both of our organizations. So we feel really good about it. And we actually feel like we'll have the opportunity to even go find more as we continue to work together between the organizations.

Yes. I think, George, just to add on to that, the good news is this $200 million we're talking about is really all within our control. We don't need cooperation from the market or from any outside to deliver, it's all based sort of on cost. I think the other opportunity that Kurt alluded to or mentioned is any commercial opportunities or revenue synergies, these are all upside. They're not required for the financial case and are not included in the returns that we've shown.

That's very helpful. And related to what you just mentioned around revenue synergies, is there a way to frame the potential upside from revenue synergies? You mentioned the strategic rationale of the combination is really what's driving this transaction. And you also mentioned that the organic growth of the combined company is going to remain around mid-single digits, which was Brink's original longer-term growth target. So is there room for that mid-single-digit organic growth to move higher because of the strong strategic benefits of this combination.

Yes. Look, Good, let me jump in here and Mark can also add in. But I'd say, first and foremost, we do see this as really being able to broaden our capabilities, both sides to serve our customers better. And in that sense, we see the opportunity to really drive great organic growth between us. We have not included any sales synergies in the modeling, as we've mentioned.

But we do see really the opportunity to bring value across both of our customer bases to drive higher levels of growth. So I think there's really good opportunity there.

Yes. I would just say George, we think about the mid-single-digit framework would be across both businesses as you look out forward, and that's probably still the right way to think about it. I'd say that the upsides to those are certainly come down to the pace at which we see more bank outsourcing either with managed services or complete ATM as a service as the NCR team has continued to grow.

And if you think about our business, as you know, those are -- our AMS DRS is growing in the 20% range, their ATM as a Service, growing 30%, 40% range. So these are certainly the higher growth areas. Obviously, as those numbers get bigger, it's harder to make that percentage continue to go as the [ law ] of large numbers catches up with you. But listen, this -- what we're looking out in front of us is this TAM, this total addressable market that includes bank outsourcing that has yet to really start in earnest.

But as I mentioned earlier, we continue to see all over the world, and you've heard from us, I think you've heard from them, in really all regions, we're seeing customers either making the decisions or at least doing proof of concepts and exploring this idea of trying to get to an integrated solution that ultimately drives lower total cost of ownership as well as higher reliability and availability.

The next question comes from Tim Mulrooney with William Blair.

You got Sam on for Tim. A lot of unpack, big acquisition, a great end of the year, and a good outlook. I guess I'll probably sit with the acquisitions here, but maybe just to kind of help frame it, and I think you were talking about this a little bit, Mark already -- you've seen acceleration in your DRS AMS business. You're expecting mid- to high teens growth for this year. When you think about this business with NCR Atleos, what is the kind of long-term growth that you're expecting this business to generate?

Yes, it's hard to put a finger on it, Sam. But I think what we said previously around our DRS AMS outlook is we think this mid-single-digit -- mid-double-digit organic growth can continue for the foreseeable future and certainly in the short and medium term. that number is starting to get pretty big and we still continue to see good growth rates. And I know, again, the Atleos guys are as well. We think about that in terms of, yes, we're able to deliver those growth rates as separate companies.

And the vision is how much more efficient, how much more better can we operate as an integrated company, orchestrating all of those capabilities across the value chain to really delight customers and differentiate ourselves to really start to instigate that ATM outsourcing, bank outsourcing that we know exists. And at some point, will come.

And I think it's -- for us, I won't say it's a wait-and-see only because we've got big appetite to grow. And we think this acquisition puts us in the best place to be able to not only accept the outsourcing [ has happened ], but maybe even become more of a catalyst to enable it.

Got it. That's helpful. You touched on this a little bit too already, but maybe we could dive a bit further into this. But when we think about the service offering you already have with AMS. What does NCR Atleos bring to the AMS business that perhaps you didn't have before or had less of? And then what are you hoping AMS to bring to the Atleos customer base that maybe they weren't as strong in.

Yes, interesting. Tim mentioned on the call that we've been customers or suppliers of each other back and forth in various places around the world. And when you have that sort of arm's length relationship between suppliers or with customers independently, inherently creates inefficiencies. And today, for the most part, most customers manage all of these activities along the value chain that I laid out in the slide there, independently, sort of in a hub-and-spoke way versus being a horizontal delivery.

And we just think that coordination across allows us to be more efficient, be better for our customers and ultimately deliver the outcomes that our customers want, which is a simplified solution of a high reliability distribution network.

And that's -- we think that can continue. If you think about what they offer versus marrying up to us, certainly, their software capability, the monitoring capability, the innovation around hardware, both traditional cash-only dispensing ATMs as well as recyclers as that's become more popular and marry that up against our broad and wide logistics network and cash handling expertise, it really puts us in a in a strong position to offer a great value proposition to customers. And if you think about all those activities across the value chain, there are very few that 1 of our 2 companies can offer.

No. Yes, that's very helpful. And I can definitely see that. If I could squeeze 1 more in then. You talked about the DRS business, kind of the opportunity there. NCR has a pretty big retail footprint. Is there any way to help size or just think about the cross-sell opportunity to your DRS business that this acquisition would bring?

It's certainly something that we would -- would think about as part of the integration, Sam. It's probably not something that we've got sized up yet. As you can imagine, these things sort of happen with the small group. But certainly, they've got 80,000 owned ATMs across their utility network. They manage quite a few more indirectly for others. And they're in really good blue-chip retail locations and whether that's in big box retail or pharmacies or electronics and consumer supplies, malls. These are all areas where we're already there as well.

And the interesting thing is, and we've seen this with our AMS business when we acquired [ PAI ] a while back, we actually saw our own people going to the same location to service different devices. And so if you think about minimizing truck rolls and cross-training our field engineers and technicians to be able to do not only the cash loading or not only first-line maintenance on ATMs, but being able to extend that across to DRS devices, cross-train our people to be able to handle multiple activities on the job site.

So again, yes, it's going to streamline for us, but more importantly, it allows us to get to customer sites faster, solve any problems or interruptions they might have to create a higher reliability, high fidelity network.

Sam, I might just add. I mean we know -- as Mark pointed out, while we don't know all the specifics yet. We do know that they are in locations that we aren't today, so it provides opportunity and vice versa, and not only in the U.S. but also globally. So yes, we think really good opportunity there for the DRS side of the business.

The next question comes from Tobey Sommer with Truist Securities.

Thanks. When you assess marrying the services of yours with NCR Atleos a specific hardware. How do you look at and assess the major risks and the positives versus your prior sort of agnostic approach to hardware?

Yes. Listen, Tim, I think at the end of the -- sorry, it's Toby, sorry, at the end of the day, I think customers want an outcome. They're not necessarily -- they don't just want Brink's. They don't just want NCR. They don't just want ABC companies. At the end of the day, they want an outcome. And when we think about ATM Managed Services, this is -- we're in the outcome business, and that's about creating reliability and fidelity in the system.

And DRS, the same, about creating security and access. And so we don't think there's a necessarily a conflict here. Certainly, there will be areas where we have customers that we're serving today already that don't have full NCR fleet, and I'm sure there are NCR customers that don't use Brink's. So we think in some ways, there could be opportunities for cross-selling. There's also -- but most importantly, I think there's going to be an opportunity for us to have real conversations about outcomes for customers, which ultimately they want. I think anytime there's change, there could be some risk.

But for now, I think we've got the right teams, the right relationships and certainly, we're going to treat our customers fairly and communicate with our customers in the right way in advance of all of this. So that's the best way to answer it.

Appreciate that.

You asked about risk a little bit, maybe I didn't hit that. I think the risk for us is probably just around distraction. And making sure our teams don't get distracted with this deal and with this combination. We've got about 12 months, we think, to close this thing. And between here and there, we've got a -- we both have very important performing businesses right now that we need to go execute. And because of that, we've ring-fenced our our teams, we've ring-fenced the day-to-day operations from the deal team and certainly we'll be using our integration management office and staff to really focus on integration to free up our day-to-day business leaders to run the business and deliver on the commitments we have already. And I know NCR Atleos would be doing the same thing.

I'm interested if we could explore a little bit more how you may be able to accelerate AMS, DRS growth post combination. Is there an example that you could give of sort of why the combined entity would maybe be able to spur and the outsourcing of a bank or sort of tackle that white space in the retail customer set?

Yes, sure. I think this is where -- an example would be both retail and in banks, where we already have strong customer relationships, they have a strong customer relationship that allows us to not have to maybe being concerned about any of the conflict that maybe you mentioned earlier about the hardware versus 1 vendor or another, I think that's the first place.

But I also think that there as we think about post acquisition once we close, having our commercial team able to raise up the opportunities and the discussions maybe that are more nascent, in each of those markets. And frankly, having 1 integrated solution would allow us there to derisk in fact, the the solution for customers. And this is something that we continue to deal with.

Even today, with the success we're having is we need partners along the value chain to help us because we don't have all of the capabilities. And of course, ATMs and ATM software and management software, these are things that we have to partner with to deliver to customers. And this will certainly simplify that and make it easier to have that discussion.

Toby, it's Kurt. Just to add on to 1 thing kind of specific. We have applications today where we have a DRS device in a store location where there's an ATM, right? And that key cash ecosystem provides a very compelling customer offerings for a retailer. As we said, there are locations we know where that doesn't exist, but it solves the same set of problems for a customer. And so this combination really allows for getting into that customer solutioning even much quicker on a bigger scale.

This concludes our question-and-answer session. I would like to turn the conference back over to Mark Eubanks for any closing remarks.

Yes. Thank you, everyone, for joining the call today. We look forward to speaking to you in our one-on-ones and maybe on the road. And again, I just want to thank our teams and the NCR Atleos team for all the work they've done to get us to this point and look forward to the years ahead.

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

Good morning, and welcome to The Brink's Third Quarter 2025 Earnings Presentation. [Operator Instructions] Please note, this event is being recorded.

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 today's press release and presentation and in the company's SEC filings. The 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. Here with me today are CEO, Mark Eubanks; and CFO, Kurt McMaken. This morning, Brink's reported third quarter 2025 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.

We believe these measures allow investors to better compare performance over time and to evaluate our performance using the same metrics as management. Reconciliations of non-GAAP results to their most comparable GAAP results are provided in the press release, the appendix of the presentation, and our 8-K filings, 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, everyone.

Starting on Slide 3. Brink delivered another solid quarter of mid-single-digit organic revenue growth. The 5% total company organic growth included an acceleration from Q2 to 19% for ATM Managed Services and Digital Retail Solutions or AMS/DRS as we continue to make progress expanding into large and growing markets.

For the second consecutive quarter, we delivered record Q3 EBITDA and operating profit margins, driven by strong productivity, the benefits of AMS/DRS revenue mix, and continued pricing discipline. Third quarter EBITDA margins were 19%, up 180 basis points from the prior year. The improvement was highlighted by 320 basis points of expansion in North America as we make progress driving a balanced agenda around growth in AMS/DRS and cost productivity with the Brink's Business System. With AMS/DRS now accounting for 28% of total revenue in the quarter and more productivity initiatives underway, we are expecting continued margin progress going forward.

Cash generation also continues to improve. In Q3, we delivered $175 million of free cash flow, a year-over-year increase of 30%. We continue to shorten our cash cycle and deliver capital efficiency across our asset base with vehicle counts down again this quarter and DSOs improved by 5 days.

Looking at the quarter in total, we delivered on our guidance commitments with performance exceeding the midpoint of our communicated ranges for the quarter. Organic growth remains healthy in the mid-single digits with AMS/DRS accelerating quarter-over-quarter. We continue to make steady progress improving profitability as we drive lasting structural changes to the way we operate on both the front lines and in the back office. Supported by this strong momentum, we are passing through our Q3 midpoint outperformance to the full year and affirming our previously increased full year framework. Kurt will have more details on the guidance at the end of the presentation.

Turning to Slide 4. You can see how our year-to-date performance supports our value creation strategy. First, we're focused on delivering organic growth primarily from our higher-margin subscription-based services of AMS and DRS. We are tracking in line with our full year framework with organic growth of 5% for the total company and 18% AMS/DRS year-to-date. The revenue growth and the execution of productivity enhancements have driven EBITDA margin expansion of 40 basis points year-to-date with acceleration in the second half. For the second consecutive quarter, we've achieved record EBITDA margins in both North America and Europe.

Free cash flow conversion is also improving. Year-to-date free cash flow has increased to 78% and trailing 12-month conversion has improved to 50% of adjusted EBITDA. Supported by growth in AMS/DRS acceptance in the marketplace, we are making structural changes in the business that we believe will continue to pay dividends for years to come. Our cash cycle continues to shorten with year-to-date DSO improvement of 5 days. We are also improving capital efficiency as we reduce our CapEx needs and leverage our network more efficiently.

And finally, we are focused on maximizing value for our shareholders through disciplined capital allocation. This year, capital has primarily been allocated to our share repurchase program, where we've utilized $154 million year-to-date to repurchase approximately 1.7 million shares at roughly $89 per share. Even with the share repurchases, we have moved our net debt-to-EBITDA leverage ratio to 2.9x in the third quarter, within our targeted range of 2x to 3x. We expect to stay within the range through year-end and remain on track to allocate at least 50% of our total free cash flow towards shareholder returns in the full year. So far, we have made meaningful progress against these value creation drivers this year.

Turning to Slide 5. You can see the progression of our revenue mix towards AMS and DRS over the last several years. As a reminder, we split our business into 2 main customer offerings, cash and valuables management or CVM and AMS/DRS. Our CVM business includes the traditional parts of the business like point-to-point cash logistics, money processing, and our international shipping business, we call Global Services, while AMS includes revenue from our ATM managed services business as well as digital retail solutions.

With full year organic growth in AMS and DRS trending towards the high end of our mid to high teens growth framework, we are increasing our mix expectations to between 27% and 28% of total revenue by year-end. While AMS/DRS is now 27% of our total revenue on a trailing 12-month basis, we are still in the early stages of penetrating this large and growing total addressable market. As we've previously discussed, unvended retail locations and ATM outsourcing opportunities represent a 2x to 3x market expansion opportunity.

Looking closer at each of the customer offerings, organic growth in CVM remain consistent with our expectations. Growth was driven by good pricing discipline and Global Services performing similarly to the second quarter. As a reminder, CVM organic growth includes the conversion of existing customers over to AMS/DRS. AMS/DRS accelerated from 16% organic growth in Q2 to 19% this quarter. Acceleration occurred in both AMS and DRS individually and was balanced across geographic segments.

In DRS, our pipelines remain robust, and we see consistent strength in verticals like pharmacies, gas stations, C-stores, quick-serve restaurants as well as fashion and jewelry verticals. In AMS, we have completed the onboarding of several key accounts and are at full revenue run rates with QT and RaceTrac here in North America and Sainsbury's in Europe with several additional customers set to be onboarded in the fourth quarter in LATAM and the Middle East.

Turning to Slide 6. I thought it would be helpful to show a map of our current AMS footprint. The highlighted 51 countries represent Brink's presence across the globe with those in light blue representing countries with existing AMS agreements. We've also added a select few customer logos to illustrate our presence in these markets. This map had almost no AMS presence less than 4 years ago. Leveraging our existing customer relationships with banks and retailers as well as our acquired and organically built capabilities in AMS, we've been able to expand this market to what it is today.

As we've previously said, this is just the beginning. While there are some impressive customers already in our portfolio, we are still in the early stages of this opportunity. As we consistently deliver reliable service with a total lower cost of ownership for customers, we see penetration opportunities both in the countries we already serve as well as the other geographies where we still have a presence. The current penetration rate for ATM outsourcing is still low. As we've previously discussed, there is an opportunity for the current addressable market to expand by 2x to 3x as more financial institutions make the shift to this win-win value proposition. This growing opportunity, coupled with an equally compelling retail backdrop in DRS provides confidence in our strategy for years to come.

On Slide 7, I'll provide a quick update on our margin improvement journey in the key North America segment. The margin progression begins on the top line, where we've improved the revenue quality by shifting to higher-margin AMS/DRS. On a trailing 12-month basis, AMS/DRS now represents 31% of revenue in this segment. Since 2022, this business line has grown by 33% with strong conversion rates and steady new customer growth driving continued market penetration. Other areas of margin enhancement include our pricing discipline and the deployment of waste elimination initiatives through the Brink's Business System. These improvements are coming through the P&L with less direct labor expenses and lower fuel consumption.

Even with the healthy top line growth, we are seeing consistent vehicle and employee count reductions and our safety performance continues to improve to record levels. In fact, since 2023, our total recordable incident rate or TRIR is down 33%. There are many studies that indicate positive correlation between higher safety records and improved shareholder returns. These returns happen because a safer work environment enables higher employee engagement, resulting in higher labor productivity, better service quality, resulting in higher customer satisfaction, which all ultimately leads to higher growth and profits. As we continue to shift to AMS/DRS and increase productivity, we are targeting to be at least 20% EBITDA margin in this segment over the midterm.

Before I hand it over to Kurt to go through the details of the quarter, I want to thank our team for executing against our strategy. We delivered another solid quarter while meeting our commitments and advancing our strategy. Growth in the AMS/DRS business lines accelerated. Our profit margins expanded to record highs and our cash generation continues to improve. Supported by large and growing markets, ample productivity opportunities and consistent execution, I remain confident we have the right team and strategy in place. I'm excited for the future and encouraged about how far we've come.

And with that, I'll hand it to Kurt to discuss the financials, and I'll come back for Q&A. Kurt?

Thanks, Mark.

I'll begin on Slide 9 with a look at the quarter. Revenue of over $1.3 billion, increased 6% with 5% organic growth and a 1% tailwind from foreign currency. Adjusted EBITDA was up 17% to $253 million, and operating profit was up 24%. Record profit margins slightly ahead of our expectations were driven by productivity, AMS/DRS mix benefits, and pricing discipline. Earnings per share of $2.08 was up 28%, driven by strong profit growth and the benefits of our share repurchase program.

As Mark mentioned earlier, free cash flow was strong this quarter with improvement in the cash cycle on accounts receivable, accounts payable, and improved capital efficiency as we continue to shift our business to less capital-intensive AMS/DRS offerings. Trailing 12 months free cash flow is up over $200 million with conversion of 50%. We've been more balanced in our pacing of cash generation compared to the prior year and are still expecting to deliver our full year framework target of between 40% and 45% conversion.

On Slide 10, organic revenue growth was $59 million, with most of the growth coming from higher-margin subscription-based AMS and DRS. It's important to note that CVM growth was and will continue to reflect AMS and DRS customer conversions. In Q3, we estimate this to be roughly 2 to 3 points of growth in CVM.

Moving to the right side of the page, organic revenue growth of $59 million became EBITDA growth of $34 million for an incremental margin of 58%. Currency changes increased revenue by 1% or $13 million, with favorability in the lower-margin euro and British pound, partially offset by currency devaluation from the Argentine peso. The FX flow-through to EBITDA was approximately 7.5% due to the geographic mix of currency. Despite this, we are pleased with our performance in the quarter with our total incremental profit conversion of 47%.

Moving to Slide 11, starting on the left. Operating profit was up $37 million to $188 million with a record margin of 14.1% on strong productivity in line of business revenue mix. Interest expense was flat year-over-year at $63 million, which is also roughly in line with our expectation for Q4. Tax expense was $35 million in the quarter, representing an effective tax rate of just under 28%, slightly lower than the Q2 rate. Income from continuing operations was $88 million.

Walking back up to adjusted EBITDA, depreciation and amortization was $62 million, primarily reflecting increased depreciation from growth in AMS and DRS equipment. Stock comp and other was $6 million in the quarter, and we still expect a slight decrease to stock-based compensation over the full year to below $30 million.

In total, third quarter adjusted EBITDA of $253 million and margin of 19% was above the midpoint of our guidance for the quarter with strong execution on AMS/DRS growth and productivity.

Let's move to Slide 12 to discuss our capital allocation framework. We have a healthy menu of organic OpEx investments that we are making to drive AMS and DRS growth. These high-return investments remain our first call for capital. Next, we reduced leverage at quarter end to 2.9x net debt-to-EBITDA within our targeted range of 2x to 3x and slightly ahead of our expectations for the quarter.

Our main use of capital this year continues to be shareholder returns, primarily through our share repurchase program. We have repurchased approximately 1.7 million shares year-to-date at an average price of just over $89 per share. We plan to remain active through the end of the year, and we remain on track to return at least 50% of our full year free cash flow to shareholders. We have been pleased with the results of our share repurchase program, which delivered EPS accretion of $0.08 in the quarter and $0.33 year-to-date.

And finally, on M&A, our posture on deals is consistent. We have a full pipeline and continue to explore accretive opportunities that have a strong strategic fit, attractive returns, and align with our broader capital allocation framework. Potential deals would most likely help us further penetrate the large and growing addressable AMS and DRS markets. An example of this was the KAL deal we discussed last quarter. By following this framework, we are committed to allocating capital in ways that will compound cash flow in the future and ultimately enhance long-term shareholder value.

Moving to the guidance on Slide 13. In the fourth quarter, we expect revenue of $1.355 billion at the midpoint of our range, reflecting organic growth in the mid-single digits. Using current spot rates, FX is expected to be a year-on-year tailwind of 1 to 2 points. The organic revenue guidance assumes AMS/DRS growth at the high end of our framework. Adjusted EBITDA is expected to be between $267 million and $287 million, and EPS is expected to be between $2.28 and $2.68.

Next to this Q4 guidance, you can see what this implies for the full year relative to our full year framework. On the right side of the slide, our organic growth framework remains consistent from the beginning of the year. We are still expecting to deliver mid-single-digit total organic growth, supported by mid to high teens organic growth for AMS/DRS. EBITDA margins are expected to expand between 30 and 50 basis points with conversion of EBITDA to free cash flow of between 40% and 45%.

We remain on track to return more than half of that free cash flow to our shareholders through our share repurchase plan and dividend. Supported by the growth and margin expansion we have already seen year-to-date, we are confident in our outlook for the balance of the year.

And with that, we're happy to now take your questions. Operator, please open the line.

[Operator Instructions] Our first question today comes from George Tong of Goldman Sachs.

You increased your full year growth outlook for AMS/DRS to be in the high teens. Can you elaborate on the client traction you're seeing in both AMS and DRS that drove you to increase your outlook?

Sure. George, this is Mark. Yes, we had a good quarter this year -- this quarter, not just on sales, as you can see, the progression continue, but also in the pipeline. And that gives us good visibility into Q4 and really into first half of next year. We're seeing it both in AMS and DRS. Both are growing equally on their own right, and we'll continue to penetrate across all regions. I think you can see in the deck this quarter, we showed just sort of a brief overview of our AMS footprint. And we're certainly not fully penetrated in those markets. But as you can see, we've got green shoots all over the globe across almost all of our footprint today with more opportunities to go.

On the DRS side, that pipeline continues to be very healthy. And one of the things that we talked about last quarter was the amount of conversions from CIT and retail to DRS. Last quarter, we were about 1/4 of our signings were and growth were coming from conversions of our CIT customers. That has actually accelerated into Q3. About 1/3 of our global DRS signings are coming from traditional customers. So we like the progress that not only we're seeing with our existing customer base, but also we continue to tap the unvended markets.

As we think about sort of going around the globe though, this -- I'd say this growth is becoming more even as we're seeing good progress both in North America as well as the other 3 regions. And you can see our -- even though our penetration in Europe is relatively high compared to the other regions, we continue to see good growth there. We'll see Latin America and rest of world continue to pick up pace as well, particularly when you look in Latin America, both Brazil and Mexico continue to really perform for us. That's something that, as you can see, it's one of our least penetrated regions, but has some of the biggest opportunities, very cash-intensive economies, large ATM networks, large bank footprints, but also a very, very large small retail distribution as well for the unvended market. This is where we see this 2x to 3x TAM continuing to be an opportunity into the future.

And then turning to your CVM business. The revenue performance relatively flat organically in the quarter, and it slowed a bit from about 1% growth in the prior quarter. Can you talk more about trends you're seeing here and factors that can either drive a reacceleration in CVM growth or perhaps further moderation in organic performance?

Certainly, the big thing there as we continue to convert, as I mentioned, to AMS/DRS, accelerating from 25% to basically 33%. That probably accounted for 2 to 3 points of organic headwind on the CVM business. And the only other piece of the CVM business really is our Global Services business, which really continued to perform in line with Q2 globally, which is sort of mid-single digits.

Our next question comes from Tim Mulrooney of William Blair.

Just first of all, on AMS/DRS, I'm wondering if you could talk about some of the things that you're doing internally to drive continued growth in that business, which is growing faster than what we were expecting this year. And I know you're winning new programs, but any details you could provide, I guess, without getting into competitive issues around maybe like…

Sure.

…are you adding additional channels, Mark? Any like adjustments to incentives, either in the field or the corporate side? Like what's really helping drive this next leg of growth, I guess, is what I'm asking?

Yes. That's a good question, Tim. We've talked briefly around this historically about how we changed our incentive comp plan. And we did that really 2 years ago, we changed our incentive comp plan for our maybe top, let's say, 100 people in the company that had a big part of their annual incentive plan were tied to DRS/AMS revenue growth. We've actually expanded that now to more than 1,000 people in the company. Basically, anyone who's got a management incentive bonus is tied to AMS/DRS growth rates. Actually, we have it weighted higher than total revenue growth to make sure that everyone understands the focus. I think that's sort of at the top level. And I think that's what's helping us and our leadership team across the globe really execute the strategy that we want, which is, again, more AMS/DRS, more flexible network, leveraging kind of the full capacity using technology to be able to do that.

On the ground, though, it's also important that our sales teams have similar incentives. And so if you think about an incentive comp plan for local salespeople, that has been, let's say, traditionally, for Brink's, a very local decision and something that local management was sort of left to do. We've started to globally align those sales incentive plans across the globe to focus predominantly on AMS/DRS and helping our customers through this journey from traditional CIT, whether it's the banking or retail segments to move to this more managed services environment. So that's been helping us make progress. This year, we're going to take another step there and further align more specificity across all of our incentive comp plans for our sales teams globally to focus on those 2 things.

In fact, we have some leadership -- local leadership that has taken this even to a higher level. We have some regions where our leadership team has made the decision to either discount commission plans or not even provide commission plans for salespeople that aren't selling DRS/AMS that might be selling traditional services. And again, not being punitive, but more leading our teams to help lead our customers to this value-accretive value proposition for both customers and for Brink's.

I think the last thing you asked about was channels. This is an area that is a big change for Brink's. Historically, we've sold direct with all of our salespeople by being direct Brink's employees selling directly to financial institutions and retailers and so forth. We've actually begun to evolve that to work with channel partners. And this is evolving in all regions. And whether this is a commission sales force or it's a value-added reseller or another channel partner, we have white label agreements with some banks to sell DRS to their retail customers. So we really are trying to evolve this process to, again, help everyone in the channel make the cash ecosystem more efficient and feel a lot more inclusive in the rest of the payments ecosystem, whether that's at DRS or in the cash distribution and deposit networks.

That's good detail. Thanks for outlining the incentives and the channels helping drive that good growth. The other thing I wanted to ask you about was the North America margins. I mean, just incredible this quarter. You're up 300-plus bps. I wonder how to think about that, I guess, from a longer-term perspective, like what the margin potential is in that business? Because I see some of your other segments and where they are, but I don't actually know if that's comparable because Latin America has some pretty different dynamics and so does the rest of the world with the BGS business. So how would you have investors -- how would you frame for investors the margin potential of that business in North America? I would ask incremental margins because that's always an easy way for analysts to kind of level set, but you're decapitalizing the business. So I don't even know if that's like the right way to think about it incremental. So I'll just -- I'll leave it there, but curious how to frame the margin either from a medium-term or longer-term perspective in North America, given the momentum that you're seeing right now?

Sure. That's a good question, Tim. I would say, if you look at the margin progression, let's just say Q3, first of all, yes, it prints 370 bps. If you remember, we had 330 bps. If you remember, we had a loss last year during this time frame that makes it a little bit of an easier comp, but still great performance from a margin expansion perspective, particularly when you look across the years. So if you look at this chart, you can see sort of steady upward progression in the business. And this is driven by really 3 big things. The first and foremost has been our AMS/DRS mix improvement across the business. That's certainly been helpful. Those are accretive margins and certainly allow us, as you mentioned, to decapitalize the business and make the business more dynamic.

The second has been a more disciplined pricing posture that we've taken that maybe historically we had not. And we've been very disciplined since coming out of the pandemic, frankly to, just to make sure that we're not only covering our costs, but also improving our margins and getting the right value with customers on both sides.

And then lastly, really has been our operational execution. And I have to applaud our North America team that really has been working hard and showing real improvements operationally, both in service quality, service timeliness and then, of course, I mentioned safety. And any time you see safety improvements, that's an indicative measure of how well we're running the business or how well the business is being run, let's say. And we think that that's a good one for investors to understand that we've got a good foundation to continue to go forward.

Our incremental margins are going to be anywhere from 20% to 30%, Tim. That's kind of how we think about it going forward. But there's not really a -- we don't think it's really an artificial ceiling here in front of us. And we think there's still more room to go. I mentioned the 20% EBITDA margins in the midterm. To me, that's just an interim checkpoint of where we want to take the business because if you know this, and it's not without -- it's in the public domain, we actually have a gap in North America with one of our other traditional competitors, which gives me lots of confidence that we still got room to go and still run the business better, much less with this new business model on top that is decapitalized, that's more flexible, more dynamic and more value accretive for customers.

Our next question comes from Tobey Sommer of Truist.

I wanted to ask about the cash conversion. What are your current thoughts on midterm goals for free cash conversion from EBITDA? And as part of your answer, could you describe the DSO improvement drivers, maybe mix shift versus other more discrete actions that you've undertaken?

Yes. Tobey, it's Kurt. Why don't I take this one, just kind of walk through it a little bit. First of all, we feel good about our framework in terms of conversion, 40% to 45%, not only in the near-term, but going forward, we think that's a good thing to look towards. The reality is we've been working hard on making sure that we're creating cash throughout the year and focusing on all aspects of that generation throughout the year. And so specifically to your DSO question, there's a couple of things to really I think focus in on.

One is the mix of the business, where if you look at AMS/DRS, those are both subscription-based business models, and they absolutely have a very favorable DSO profile for us. So as we continue to grow that, that is a real positive for our DSO improvement. We were better by 5 days, as we mentioned. I mean the other is, again, we -- this gets back to a comment Mark made on incentives. We really have a broad-based incentive now across our leadership base focusing on free cash flow delivery. And so therefore, that delivery really, really is spread out around the world and people focused on it. So that's number two.

The third I'd say is just maybe really working collections harder than traditionally has been done, just getting in and grinding through it, I think is also a factor. The other thing I'd mention too you didn't mention on accounts payable DPOs, but that has also been a real focus for us. We were better, improved by 4 days at the end of the third quarter as well. So that's the second piece.

And then finally, I'd say on the CapEx and the capital intensity side of things, the AMS and DRS is a less capital-intensive business. We've been decapitalizing, taking trucks out, for example, Mark has mentioned that in the past. So all of these levers are really working towards the free cash flow generation conversion factor supporting it.

Geographic growth was pretty well balanced organically in the quarter on a year-over-year basis. What geos may have higher or lower trajectories going forward? And maybe if you could provide a driver for why there could be a more wider dispersion going forward, if you think that's the case?

Yes, sure. In fact, I don't think that's the case, Tobey. I think we've got opportunities to continue at this pace in all regions. Of course, there's going to be opportunities up and down. You think about the Rest of the World segment, particularly given the fact that half of it is BGS. Volatility, obviously, in that part of the world makes a big difference. And so that's why you saw 9% in Q1 and sort of mid-single digits moderating here in 2 and 3. So maybe that's one area. But to be honest, we still feel like we've got good runway with all of the regions, particularly when you consider the unvended retail markets in one vein.

And the second is the installed base of the banks. And so as our outlook -- as we think about outlook for AMS and we think about bank outsourcing, there's no region that is over penetrated or has already matured in that way. And we think our ability to capture that when those markets are turned over the next few years, we think there's good opportunity, again, in a big TAM over the next -- well, for good organic growth across all 4 regions.

I think we think about sort of looking forward in the next year, maybe in the shorter term, there's nothing we've seen from a customer and market perspective that would change our mind on the organic outlook. We think this framework, obviously, we'll put our guidance out in -- after Q4. But there's nothing that says we wouldn't be able to continue this same framework of mid-single-digit organic growth is mid to high teens AMS/DRS, 30 to 50 bps of EBITDA margin.

And just thinking about what's happened this year and relative to the FX in H1, we had a big headwind and slight tailwind in H2, probably going to see something similar if you look forward into [ '21 ], a little more of a benefit early in the year in H1 and then, obviously, not much benefit if you snap today's -- snap the line on today's FX rates in H2. So we feel like we've got a pretty good setup for next year. And again, healthy pipelines, as I mentioned, both in AMS/DRS that continue to accelerate as we shift our incentives, as we improve our execution, as we build out more product offerings for our customers and then ultimately, how we execute in the field that continues to improve and get better and just expanding with more channel partners and more at bats with more customers is just going to fuel this opportunity.

So nothing that I would say would slow down the organic opportunity. Kurt, anything maybe about '26 or anything else you?

Yes. Just to be clear on the FX, Tobey, I think Mark's comment there, I mean if you snap the line today using rates today, you would expect to see a slight tailwind in '26 and for the year and then more weighted towards the first half is what Mark was -- just to be clear on that. But the other thing I'd say is that as we look at -- and Mark was talking about opportunities, if we think about how we're really trying to run the business, we definitely continue to see -- we see opportunities in the area of getting a lot more efficient in our SG&A area. So we're continuing to work at this, and we'll continue to make progress. But as Mark has described, how we're running the business differently than how we have in the past, we expect that we're going to continue to really find efficiencies to support our margin expansion.

Yes. I think this is part of just globalizing the business, Tobey. And as you think about our strategy, it's multipronged. And certainly, it's around growth and customer loyalty. It's around innovation around technology and customer offerings, operational excellence and people. But part and parcel to all of that is sort of how we run the business day-to-day in the back-office as well, whether that's across the big functions in finance, IT, HR, sourcing, procurement, real estate, those are all things that historically for 165 years, the company has run sort of independently and disparate around the world. We've been evolving that. We certainly have a strategy around doing more things similar. And we think there's still more back-office sort of fixed cost productivity left in the business that we plan to start getting after and more so in '26 and beyond. So there's -- yes, there's good organic growth. Yes, there's good product mix, but we think we've still got some good productivity left in sort of the fixed base of the business that we can wring out.

I'd like to sneak one more in and just because I'm not asking about AMS deals, doesn't mean I don't like the growth. The bank consolidation, what's your view on it here on a net basis? I'm sure there are puts and takes on either side and -- but approvals from regulators are the fastest they've been since 1990 at 4 months and some deals have started to be announced. So if this ends up being something that lasts for a few years, how should investors think about that and its implications for your business?

Yes. Good question, Tobey. It's something we obviously are watching very closely. And these most recent announcements have certainly been in our customer base. And so trying to see where those things land. We think with our AMS solutions, this likely becomes an opportunity just given the fact that we have the ability to, first and foremost, provide an offering that is unique, we think in the marketplace. It's not commoditized, and we have a unique offering and a unique value proposition to do that.

The second is for those consolidators, we provide them an opportunity to create real cost synergy as well as they think about streamlining their network, their branch footprint, their infrastructure to, again, help through that synergy to sort of wring out the cost and productivity that exists. And we talked about this previously about AMS in general, we've seen earlier in early years, the last few years, we've seen more opportunities outside of North America around AMS, just given the fact that the banking footprints were already consolidated and that this an ATM network productivity opportunity really was pretty high on the list of improving profit margins, whereas in the U.S., more bank consolidation and sort of redundant public company costs were -- or infrastructure and compliance costs were more of the productivity lever.

We actually are starting to see the AMS discussions more frequently in North America. I don't know if the 2 things are tied to this consolidation or not, but we certainly think there's going to be opportunities for us there. I think in the short-term, there is certainly footprint consolidations that would happen to our traditional business potentially, where if a bank buys another bank, they've got 2 branches on the same corner, maybe we lose a location there. That certainly could happen. But as we think of -- we -- well, back up, we are thinking about this strategically and making sure that we're also partnered with the right consolidators and making sure that we're serving those being consolidated also in a healthy way that allows us to maintain those customer relationships in the event there is a merger. So I'd say net-net, Tobey, we think this probably is good just based on the AMS opportunity for long-term.

Sure. Great. Well, listen, thanks for joining us, everyone. We appreciate your continued interest in Brink's, and we look forward to speaking with you all soon, whether on the phone or on the road. Have a great day.

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

Good day, and welcome to the Brink's Company's Second Quarter 2025 Earnings Conference Call. 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 today's press release and presentation and the company's most recent SEC filings.

The information presented and discussed on this call is representative of today's only.

Brink's assumes no obligations to update any forward-looking statements. This 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. Here with me today are CEO, Mark Eubanks and CFO, Kurt McMaken.

This morning, Brink's reported second quarter 2025 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 they allow investors to evaluate performance using the same metrics as management.

Reconciliations of non-GAAP results to their most comparable GAAP results are provided in the press release, the appendix of the presentation and the 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. Good morning, and thanks for joining us.

Starting with the second quarter performance highlights on Slide 3, Brink's delivered strong organic revenue growth in all segments and lines of business. The 5% total company organic growth included 16% growth in ATM Managed Services and Digital Retail Solutions, or AMS/DRS as well as 5% growth in North America, this is the fastest organic growth rate for North America segment in the last 9 quarters. Total reported revenue growth of 4% exceeded our guidance for the period.

Record Q2 EBITDA and operating profits were driven by strong productivity, revenue mix benefits and good pricing discipline. Second quarter EBITDA margins were 17.8% and record second quarter operating margins were 12.6%, up 20 basis points year-over-year. The benefits in growth in AMS/DRS were evident in both North America and Europe, where we posted record second quarter EBITDA margins. We continue to see margin improvement opportunities in these segments as we move through the balance of the year.

Earnings per share of $1.79 reflects the benefits of our ongoing share repurchase program, with total diluted share count down 6%. Cash generation also continues to improve. In Q2, we delivered $102 million of free cash flow, a year-to-date increase of $36 million. We continue to shorten our cash cycle and deliver capital efficiency across our entire asset base.

Looking at the second quarter in total, we overdelivered against our commitments. Organic growth remains robust with acceleration in our key business lines of AMS and DRS expected in the second half of the year. Profitability continues to improve as we drive meaningful operational consistency and shift our revenue to higher margin lines of business.

The strong first half performance has increased our confidence and we're now expecting an increase in revenue and EBITDA for the full year. Kurt will have more color on our third quarter guidance and our full year framework at the end of the presentation.

Turning to Slide 4. You can see how our year-to-date performance supports our value creation strategy. First, we're focused on delivering organic revenue growth, primarily from our higher-margin subscription-based services of AMS and DRS. Through the first half of the year, we remain on track for our full year framework, delivering 5% organic growth and 18% organic growth in AMS/DRS. This revenue growth and execution of productivity enhancements have driven operating margin expansion of 30 basis points year-to-date. As we've previously discussed, and as you can see from our Q3 guidance, we expect margin expansion to accelerate in the second half of the year, and we remain on track to deliver our framework of 30 to 50 basis points of EBITDA margin expansion in 2025. We are delivering improvements in free cash flow as well.

Trailing 12-month free cash flow has increased by $140 million and conversion has improved to 48% of adjusted EBITDA. We are driving structural changes to the business that support this improving free cash flow generation. Our cash cycle continues to shorten with DSO improvement of 6 days. We're also improving our capital efficiency as we shift to less capital-intensive AMS/DRS offerings, reducing several hundred vehicles from our fleet year-to-date. And finally, we're focused on maximizing value for our shareholders with disciplined capital allocation.

This year, capital has primarily been allocated to our share repurchase program, where we've utilized $130 million year-to-date to repurchase approximately 1.5 million shares. With the remaining capacity under our share repurchase program through the end of the year of $166 million, we remain on track to allocate at least 50% of our free cash flow towards shareholder returns in 2025. The meaningful progress we've made against these value creation goals in the first half of the year provides confidence and support to our increased expectations for the full year.

On Slide 5, I'll provide a strategy update on our ATM Managed Services progress. Across the top of the slide, you can see the ATM ownership value chain from software on the machines all the way through cash logistics and money processing. Our business was historically focused on cash and transit and money processing but over the last few years, we've added capabilities, both organically and through acquisition, which have expanded our addressable market and moved us further up the value chain. This expanded market has allowed us to consistently deliver mid- to high teens or better organic growth since we started reporting AMS.

In the second quarter, we saw record transactions and cash dispensed in several of our large geographies, including North America. We recently finished onboarding several large new AMS customers, including Sainsbury's Bank in the U.K. and a few large convenience store chains in North America. The combination of record transactions and larger installed base support our increased expectations for AMS and DRS in the second half of the year.

During the quarter, we also closed a strategic investment in KAL that advances our existing AMS capabilities. KAL is a leading global hardware independent ATM software provider and a globally recognized solutions provider for financial institutions and retailers. With many of our ATMs already using KAL software, we believe this partnership allows us to provide improved solutions to the Managed Services marketplace.

Moving to Slide 6 on DRS. First, a quick reminder on the value proposition of digital retail solutions for both our customers and for Brink's. For our customers, DRS helps move cash transactions into the digital world. Once cash is accepted at retailers from customers and deposited into a DRS device, there's now a digital record of the transaction and the customer's bank account is credited. To the retailer, this process looks and feels similar to credit and debit transactions, often at prices that are less than their typical 2% to 4% of credit card fees. Benefit of this process for customers include faster access to working capital and improvement in store productivity without the need to reconcile the cash received and then walk deposits to the bank. We've seen our customers reduce internal theft and when interfaced with a point-of-sale operating system, allow customers to gain the ability to digitally track customer's individual cash transactions. The value proposition for Brink's includes a transition to flexible schedules only dispatching service when needed or convenient. This allows us to provide a superior customer offering, while improving labor and CapEx efficiency. Because this service includes flexible scheduling, we have extended our potential customer base to include enterprise customers that were not officially served by traditional services as well as small and midsized businesses that were previously priced out of the cash management solution. By penetrating this large unvended market and converting existing CIT customers to DRS, we've been able to scale this business with double-digit growth rates over the last couple of years.

Looking at a few highlights this quarter on DRS, we had record global device installations as we continue to build momentum in all markets. Encouraged by the traction that we've seen in the business, we continue to scale and invest in dedicated commercial capabilities across all markets to further penetrate this large untapped total addressable market. We believe these new investments will drive continued growth in both margin accretive conversions of existing customers as well as the unvended retail locations.

On Slide 7, you can see the market expansion potential into AMS and DRS. Traditionally, Brink's has been the leader in the $28 billion cash logistics end market. Using industry data, we estimate that the current vended AMS market is roughly $8 billion. If you add the addressable market for unvended retailers with more than $5,000 in monthly cash transactions, and if all banks decide to outsource their ATM networks, our total addressable market would increase by 2x to 3x our existing traditional market. This market potential is something we've already seen in our numbers, with new customers like Sainsbury's Bank and AMS and a large part of our DRS growth coming from this unvended white space. This market expansion, coupled with the success we've already delivered, gives us confidence in our ability to achieve our mid- to high-teens organic growth framework for AMS/DRS over the midterm.

Turning to Slide 8. I'll try the last few slides to our Q2 results before turning to Kurt to provide some additional financial details on the quarter. We split our business into 2 main customer offerings, cash and valuables management or CVM; and AMS/DRS. Our CVM business includes the traditional parts of our business, like cash in transit, money processing and our international shipping business we call Global Services. Organic growth in CVM was stable sequentially this quarter, with growth of 1% year-over-year. As we previously explained, headline growth in CVM is impacted by the conversion of traditional ATM or CIT customers to AMS/DRS which we estimate cost us a couple of points of growth in the quarter. Year-to-date, our Global Services business has supported CVM growth with high precious metals demand, partially related to the global trade policy environment. AMS/DRS had another strong quarter with organic growth of 16%, in line with our expectations for the quarter. As we previously discussed, growth this quarter was impacted by a onetime impact of higher equipment sales in the quarter last year. This included record growth in North America as we onboarded several large AMS customers and installed a record number of DRS devices in the quarter.

As I've mentioned in the past few slides, we continue to build considerable momentum in AMS and DRS and expect our growth to accelerate in the second half of the year. Pipelines remain robust in both areas and we continue to close new customer sales. With expectations increasing, we now expect to be at the top end of our organic growth guidance for AMS/DRS for the full year. It was a great quarter of progress on our strategic initiatives. Growth in AMS/DRS was strong, and our outlook for the second half of the year has improved. Operating margins expanded in Q2 and are expected to accelerate into the second half of the year. Our cash generation was also strong, and we continue to improve CapEx efficiency and shorten our cash cycle.

In the second quarter, we remained aggressive with our repurchase program, reducing our share count by 4% year-to-date. I'm confident we're executing the right strategy to drive shareholder value and I'm encouraged by the opportunity that are in front of us.

And with that, I'll turn it over to Kurt to discuss the financials, and I'll come back with some final thoughts & Q&A. Kurt?

Thanks, Mark. I'll begin on Slide 10 with a look at the quarter. Revenue of approximately $1.3 billion increased 4% with 5% organic growth, partially offset by currency. Adjusted EBITDA was up 3% in total and 5% constant currency to $232 million, and operating profit was up 6% or 9% on a constant currency basis. Record operating margins and EBITDA well ahead of the top end of our guidance range were driven by strong productivity. Earnings per share of $1.79 was flat to the prior year, with operating profit growth and a diluted share count reduction of 6% year-over-year, offset by increases in tax rate and interest expense year-over-year. As Mark mentioned earlier, Free cash flow was strong this quarter with improvement in cash cycle on accounts payable, accounts receivable and improving capital efficiency as we shift our businesses to AMS/DRS. We delivered over $100 million of free cash flow in Q2 and remain on track to achieve our framework of between 40% and 45% conversion.

On Slide 11, organic growth was $60 million, with over 80% of that growth coming from higher-margin subscription-based AMS and DRS services. The $12 million of CVM growth included growth in Global Services and the impact of AMS and DRS customer conversions. Currency changes amounted to $17 million or 1% in the period. FX tailwinds, primarily from the euro and British pound were more than offset by currency devaluation in Latin America, primarily from the Mexican peso and Argentine peso.

On Slide 12, starting on the left. Operating profit was up $9 million to $165 million with a record margin of 12.6% on strong productivity and line of business revenue mix. Interest expense was up $4 million year-over-year to $61 million. We expect the $61 million to be a good quarterly run rate for interest expense for the balance of the year. Tax expense was $31 million in the quarter representing an effective tax rate of 28%, in line with our expectations. This represents an increase from the 23% we saw in the prior year. As a reminder, this tax rate increase is primarily related to the lapping impact of onetime tax benefits in the prior year that are not expected to repeat in 2025. Income from continuing operations was $76 million.

Walking back up to adjusted EBITDA, depreciation and amortization was $58 million. We still expect total D&A to rise modestly in 2025, primarily reflecting increased depreciation from AMS and DRS equipment. Stock comp and other was flat to the prior year, and we still expect a slight decrease to stock-based compensation over the full year to between $30 million to $35 million. In total, the record second quarter adjusted EBITDA of $232 million exceeded our original expectations for the quarter, driven by revenue mix and the efficiency gains mentioned earlier.

Let's move to Slide 13 to discuss our capital allocation framework. As Mark mentioned earlier, we continue to make strategic investments in our business to drive organic growth opportunities and fund productivity initiatives across the business from labor management to route optimization. These investments are typically made through OpEx, but they will remain our first call for capital.

Moving to leverage. We are targeting between 2 and 3x EBITDA or slightly above this range as of the end of Q2 as we accelerated share repurchases into the early part of the year to opportunistically take advantage of attractive pricing. We remain on target to be below the top end of the range by year-end, consistent with prior year. Our primary use of capital continues to be shareholder returns, primarily through our share repurchase program. We have retired approximately 1.5 million shares year-to-date and will continue to be opportunistic in the second half of the year. We also maintained a modest dividend that we have demonstrated we are committed to growing annually.

And finally, on M&A, our posture on deals is unchanged. We have a full pipeline and continue to explore accretive opportunities that have a strong strategic fit, attractive returns and align with our broader capital allocation framework. KAL investment Mark discussed earlier, expands our AMS capabilities and helps us gain better access to new customers that we can pursue organically. Investments like KAL give us quicker access to the expanded addressable markets we are now pursuing, which we believe will increase the pace of our strategy execution. We continue to allocate capital in ways that will compound cash flow in the future and create long-term shareholder value.

Moving to the guidance on Slide 14. Based on the strong first half performance in AMS/DRS and Global Services, good visibility of AMS/DRS acceleration to the high end of our framework and the favorable first half FX trends, we are increasing our expectations for the full year for the second consecutive quarter. Factoring in strong operational performance and using today's FX rates, our full year revenue increases by about $75 million and EBITDA by about $20 million from our expectations after the first quarter. The remaining components of our framework are unchanged, with margin expansion expected between 30 and 50 basis points, free cash flow conversion between 40% and 45% and shareholder returns of over 50% of free cash flow.

In the third quarter, we expect revenue of $1.33 billion at the midpoint of our range. reflecting organic growth in the mid-single digits. FX is expected to have a slight tailwind in the period, primarily in our European segment. The organic revenue guidance assumes strong continued growth in AMS/DRS towards the high end of our framework. Adjusted EBITDA is expected to be between $240 million and $260 million. Adjusted EBITDA guidance reflects the flow-through of revenue growth and continued strong productivity as well as normalizing FX in the high-margin Latin America segment. EPS is expected to be between $1.85 and $2.25. We remain confident in our ability to deliver accelerated margin expansion in the second half of 2025. This is attributed to our strong AMS/DRS growth trajectory and the productivity initiatives we are seeing across the business. Additionally, our seasonal volume and profits accelerate in the second half in many of our end markets. On average, over the last 4 years, we have generated about 55% of our full year EBITDA in the second half of the year. and this is consistent this year at the midpoint of our framework.

Now I'll hand it back to Mark for closing comments before we start Q&A.

Thanks, Kurt. I'm encouraged by another strong quarter of strategic progress. We've increased our full year expectations now for the second consecutive quarter after exceeding the top end of our second quarter guidance. As we look at the back half of the year, we have good visibility into the accelerating momentum in our growth verticals of AMS and DRS as well as the productivity initiatives in our key markets. We are confident in our ability to deliver accelerating margin expansion and EBITDA growth. I'm confident we are sustainably improving operations and building a business that will deliver consistent growth, consistent margin improvement and free cash flow generation for years to come.

And with that, we're happy now to take your questions. Operator, please open the line.

[Operator Instructions] The first question comes from the line of Tim Mulrooney with William Blair.

So a few questions here. The first is on your second quarter results. It looks like adjusted EBITDA margin in the second quarter of 17.8%, that was well above your guide for 16.9%. And I recall last quarter, you calling out a few potential swing factors like FX, Argentina, interest income, timing of restructuring, which 1 of those factors played out differently relative to your expectations? Or were there other factors like organic performance that you'd call out?

Yes, sure. Thanks, Tim. First of all, we had a really strong organic growth quarter. And I think the printed numbers at 4.8% actually are a bit understated. We actually had probably 2 less workdays in Latin America and Europe and at least 1 in North America and Rest of World. So that's a pretty decent adjustment, maybe 1.5 points, 2 points as well as we lapped a previously disclosed equipment, onetime equipment sale from last quarter, again, another 0.5 point or so. So we felt like a really strong organic growth quarter came through than maybe even we were expecting almost probably on an adjusted basis, 6.5%, 7%. So we feel pretty good about that, which gives us some confidence and momentum in the back half. So obviously, the volume helps. The other is DRS/AMS mix that also continues to be a real green shoot in the business. And as we think about the back half, we still are committed to acceleration of that AMS/DRS mix as part of our business, and that's obviously helpful. And then as well, we had quite a bit of productivity coming through. We're seeing good productivity. In fact, record margins in both North America and Europe in the quarter that are part of our trend and trajectory that we talked about and expect going forward. The things that we're working on from a productivity perspective are both inside our facilities as well as outside. And we made some investments late last year in our money processing centers. We've talked about that previously, and that is driving good productivity and throughput through our facilities as well as routing initiatives that we talked about for route optimization, that's happening -- coming across, you can see and clearly in North America, but we're also seeing this in parts of Latin America as well as Europe, as we're rolling out the program. So really good benefits as we think about that forward. So I'd say in general, Tim, we probably had maybe more just sort of business organic performance improvements, less about things needing to go our way. And so restructuring we did, the stuff that we talked about delaying out of Q1 to Q2, we executed on. That's in our numbers. And in fact, I think the other thing you mentioned was FX. So we did see a little bit of a slight improvement on FX. But in fact, from a -- in total in the quarter, the benefit was about $17 million of revenue. But in fact, it was a headwind to EBITDA from our last guide. So really strong performance, really proud of our team globally to deliver.

Tim, the only thing I would add to that is really more operationally oriented, is that we did -- we had a really good quarter, I'd say, price relative to cost inflation, and we covered our cost inflation with price in all of our businesses, did a solid job there. .

Okay. That's really helpful color. It sounds like there's actually a lot more on the organic side than I appreciated and like you said, Mark, less about FX. I also didn't appreciate the Workday adjustment and the equipment sale adjustment. So taking all that into account, it sounds like things are moving really well on the organic side. I did want to ask about the AMS/DRS as well because if I'm doing my math right, I think you did 20% organic in the first quarter, 16% this quarter. So that's 18% organic for the first half of the year, plus or minus, right? And your calling -- you're guiding for, I guess, high teens for the full year. Because that would be the high end of your range, but you're already there. And you're telling us that you're looking for accelerating trends in the back half of the year. So can you square that circle for me? Like is that a pace we're being a little conservative here? Or is it like pay these implementations to be lumpy. You don't want to get ahead of yourselves. Any help there?

Yes, I'd say both of those. So the acceleration we talked about in both -- in their fair market as well as even last quarter, we really accelerated out of Q2 because we did see -- we did have this sort of air pocket on equipment sales lapping year-on-year as well as we had some large ATM rollouts that we did in Q2 that, to your point, was a little bit lumpy in Q2, but we know those are online now, we know the equipment sale has lapped and we feel good about what we see in the back half. It's probably more in line with the upper end of our guide or closer to what we saw in Q1. .

Got it. And then just if I could just squeeze 1 more in on BGS. I wanted to ask how that performed during the quarter, if it kind of reverted back toward that mid-single-digit growth rate that you -- I think were expecting heading into the quarter? And I'm also curious, now with more tariff noise back into the market today, if you're seeing any pickup in shipment activity once again as we're moving through the third quarter here.

Yes, sure. Good question. So obviously, we had a very strong Q1 for that business just coming out of Q4 that we we discussed. Q2, as we expected, did moderate after a lot of the tariff noise to closer to that traditional more of a mid-single-digit range. Early in July, we saw -- we're seeing kind of similar mid-single digits. And so we expect that to continue for the near term. But these things -- these trends can change quickly with 1 tweak tariff change, this could evolve. And we're fortunate that we have this position and we have this infrastructure, take advantage of any of those dislocations in the market that causes people to move precious metals or other valuables. So all in all, we still -- we're expecting a strong year, full year still and -- but expect the second half to be more in line with the mid-single-digit range. .

Next question comes from the line of Tobey Sommer with Truist.

This is Tyler Barishaw on for Toby. Wondering if you could discuss any internal initiatives you're taking to push customers into AMS and DRS? Any actions pushing customers away from CVM? Or just curious if you could expand on that.

Yes, sure. Tyler, we're always trying to find ways to move people to what we think is a better value proposition, both for them and for us and enabling us to use our networks more efficiently. But in some markets, in some -- with some customers, they still highly value our traditional CVM business. And that continues to be a big source of business for us and lots of large customers. I'd say that the opportunity, half of that CVM business in our traditional CIT is with the banks where we're either servicing branches or ATMs. And that's where we feel like as the ATM Managed Services continues to grow. We're seeing more and more banks wanting to talk about outsourcing their networks or augmenting their networks through leveraging our services. And so this is something we're seeing everywhere. We're seeing some good growth in North America and Europe in the quarter and are seeing -- we talked about some wins last quarter in Latin America -- I mean, I'm sorry, in Asia Pacific that we'll be onboarding here in the next couple of quarters as well as some pilots that we've just initiated here in this quarter in Latin America. So that AMS is less of a push, it's more of a pull. We're pulling customers to us with more services. And I would say DRS is similar, although most of the DRS growth that we've seen in the last 2, 3 years has really been new customers that are unvended customers that don't use any sort of CVM services. Although we are putting more focus on converting customers here in '25 and have seen that trend pick up as a share of our new customers. And I think that's something that, again, is a pull versus a push and really customers who appreciate that value proposition. And frankly, we're getting better at also communicating it as well as building out a sales force that is focused on that kind of solution sale, not necessarily based on traditional sales model or an RFP kind of a situation?

Got it. Can you maybe talk about what lessons you're learning now in markets where DRS has the most traction.

Sure. I think about Latin America, particularly, that's a market that is a very cash-intensive market where there's a lot of small format stores and the cost to serve is pretty high because of the security infrastructure. And so in those markets, it's sometimes more difficult for customers to justify in a small format a traditional CIT pickup that might be 2, 3, 4, 5 days a week versus getting to a DRS solution that allows them at a lower entry point -- a lower subscription rate and allows us to use a lower cost to serve provide a good value proposition for the both of us. So I think that is certainly happening. I think the other place we're seeing benefits are certainly in North America when you think about the large enterprise customers they -- our customers not only value the cash security as well as the provisional credit, the transactions that feel a lot like credit and debit, but they also value this idea of having 1 provider provide that solution that allows them to consolidate banking relationships across thousands of footprint, thousands of location footprints that they traditionally been walking money to the bank with their employees. And so I think this is an area where we continue to see strong adoption. In fact, we had a record installation quarter in North America with our DRS devices, and our pipeline continues to grow. .

Tyler, the only thing I'd add is, I think also operationally, we're definitely continuing to get better and better in all regions from a quote to revenue kind of basis. So it's really --

Mid-cycle time.

Mid-cycle time, yes.

Got it. And then just on the North America segment at large, can you maybe talk about your expectations for the second half of the year. You've seen a nice acceleration in 1Q to 2Q, but just curious if you can talk about expectations for the back half of the year.

Yes. I think we expect it to continue on a slight upward trajectory. As you think about the back half, certainly, our pipeline would support that, particularly in AMS and DRS as I mentioned, we brought on a few large customer networks in the convenience store area. But we also still would expect our Global Services business to continue to be healthy in the year given the tariff situation relative to precious metals. .

[Operator Instructions]. Next question comes from the line of George Tong with Goldman Sachs.

You talked about expectations for the DRS and AMS businesses to accelerate. Is there any way to differentiate between how much acceleration you expect between those 2 going into the second half of the year and perhaps even into 2026, if you see any differences in the growth curves or the growth trajectories between the 2.

No, not necessarily, George. It's pretty lumpy with these big customers. And I would say that's certainly the case with AMS and sometimes even with the DRS large customer rollouts can be lumpy when they come on board or not. And we've seen that sort of push in full. But generally, these have been pretty balanced growth rates for both. The acceleration that we expect to see coming out of Q2 into the rest of the year from an organic growth perspective, again, it feels more like Q1 kind of trajectory. But that looks pretty balanced and the visibility we have, not only in the booked business that we've either installed or are installing here in Q3, but also the pipeline and sales velocity that our teams are working through. We've got a pretty good handle on that. So I would say that the back half looks similar. I think as you think into '26, growth rates, there's no reason for us to think growth rates would change relative to each other. And again, I think our framework in the midterm will continue to be this mid- to high teens.

Got it. That's helpful. And then in the quarter, you saw about 1% organic growth in your cash and valuables management business. Would you say that's a steady state rate of growth? Or do you see catalysts that can alter that rate of growth to the upside or downside?

Well, I think that first and foremost, the BGS business certainly can do that. With more volatility like we saw in Q1, we could see the CVM segment outperform. I think the other thing, George, is the downside or the other way would be just more conversion to AMS/DRS. And I think that for us, that's a good situation and always positive mix for us as we go forward. And again, I look at the growth rates in total from an organic perspective and the trajectory we have. This is all very supportive of each other. And in fact, the network that we use for CBM and the same network we use for AMS/DRS is just allowing us to add more value on top of that for customers that allows us to provide not only growth in total, but also accretive margins to the portfolio, which is a good mix benefit, obviously, for the company. .

And George, just -- Mark made a comment about the workdays earlier and that would also benefit the CVM segment, obviously, in the quarter. So as you look at that 1%, you get a positive to that given the workday adjustment.

This concludes our question-and-answer session. I would like to turn the conference back over to Mark Eubanks for any closing remarks.

Thank you for joining us this afternoon. We appreciate your continued interest in Brink's and look forward to speaking with you all soon whether on the phone or when we're on the road. Have a great day.

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