Brinks Company (The)

Welcome to the Brinks Company's second quarter 2022 earnings call. Brinks issued a press release on second quarter results this morning. The company also filed an 8K that includes the release and the slides that will be used in today's call. For those of you listening by phone, the release and the slides are available in the investor relations section of the company's website, Brinks.com. At this time, all participants are in a listen-only mode. A question and answer session will follow the form of presentation. As a reminder, this conference is being recorded. Now for the company's safe harbor statement. This call and the Q&A session will contain forward-looking statements. Actual results could differ materially from the projected or estimated results. Information regarding factors that could cause such differences is available in today's press release and in the company's most recent SEC filings. Information presented and discussed on this call is representative as of today only. Brinks assumes no obligation to update any forward-looking statements. This call is copyrighted and may not be used without written permission from Brinks. It is now my pleasure to introduce your host, Ed Cunningham, Vice President of Investor Relations. Mr. Cunningham, you may begin.

Thanks, and good morning, everyone. Joining me today are CEO Mark Eubanks and CFO Rhonda Monaco. This morning we reported second quarter results on both a GAAP and non-GAAP basis. The non-GAAP results exclude a number of items, including the impact of Argentina's highly inflationary accounting, reorganization and restructuring costs, items related to acquisitions and dispositions, valuation allowance on tax credits, and changes in certain allowance estimates. We're also providing our results on a constant currency basis, which eliminates changes in foreign currency exchange rates from the prior year. We believe the non-GAAP results make it easier for investors to assess operating performance between periods. Accordingly, our comments today will focus primarily on the non-GAAP results. Reconciliations are provided in the press release, in the appendix to the slides we're using today, and in this morning's 8K filing, all of which can be found on our website. I'll now turn the call over to Mark.

Thanks, Ed, and good morning, everyone, and thanks for joining us today. This morning, we reported record second quarter results, including double-digit organic growth in revenue, operating profit, adjusted EBITDA, and earnings per share. We achieved these results in a macro environment that continues to be challenging, demonstrating the resiliency of our business. We also affirmed our full-year guidance, which includes revenue growth of 8% to 11%, and operating profit growth of 16% to 23%, reflecting approximately 100 basis points of margin expansion driven by our lean cost initiatives and leverage from a lower fixed cost base. Our full year guidance is supported by our year-to-date results, which are included in our appendix. Through the first half, we've achieved 9% revenue growth, 18% profit growth, a 16% increase in EBITDA, and earnings per share growth of 26%. We delivered these results despite a slower than expected start to the year due to Omicron related shutdowns in many of our markets. We expect this momentum to continue through the second half, which is historically much stronger than the first. Before moving on to the details behind our results, I want to touch on our sustainability efforts. In July, we issued our first corporate sustainability report, which shared more about our priorities and the United Nations sustainable development goals that align with our operations. We're in the early stages, but sustainability is an important focus for us, and we look forward to sharing more about our commitment, the targets we intend to achieve, and the progress in future quarters. Slide four summarizes the strong revenue and profit growth we achieved in the second quarter. Revenue was up 8%, with organic growth of 13%, driven by double-digit organic growth in all four of our segments. Second quarter U.S. dollar revenue recovered to 99% of pro forma pre-pandemic levels, up from the 95% recovery we saw in the first quarter, reflecting steady sequential improvement from April to June. In fact, June revenue recovery reached 100%. On a local currency basis, excluding Argentina, revenue has now been at or above the pre-pandemic levels for two consecutive quarters. While our pro forma revenue has now fully recovered from the impact of COVID-19, many of our markets, particularly in Asia, are not back to pre-pandemic revenue levels, but we expect these markets to continue to recover. Operating profit was up 12% with organic profit growth of 17% and acquisition-related growth of 1%, partially offset by a 6% negative impact from FX. This profit growth was driven by strong year-over-year margin expansion in three of our four geographic segments. The exception was North America, where profits declined versus last year's very strong second quarter, which benefited from several one-time adjustments related to various insurance credits, bad debt reversals, and COVID-related government subsidies that on a combined basis more than offset the second quarter margin improvement this year. On a sequential basis in 2022, the North American margin rate increased by 190 basis points over the first quarter rate, and we expect further improvement in the second half. In North America, our price increases continue to outpace our labor and other cost increases, and labor availability continues to improve. Adjusted EBITDA was up 13% company-wide and up 17% in constant currency with a margin of 16.4%, up 60 basis points over prior year. I'll now turn the call over to Ron, who will cover these results in more detail. Ron?