Brinks Q2 2020 Earnings Report
Key Takeaways
Brink's reported a decrease in revenue by 10% compared to the previous year, but the results were stronger than expected due to cost reductions and a resilient retail customer base. The company is cautiously optimistic about sequential profit growth in the second half of 2020 and accelerated revenue growth in 2021.
GAAP EPS was $.27, compared to $.25 in the prior year; non-GAAP EPS was $.67, compared to $.86 in the prior year.
Revenue decline improved from 29% in April to 14% in June, excluding the G4S acquisition.
Reported revenue decreased by 10% compared to 2019, with a negative currency translation impact of $86 million.
The G4S acquired businesses are performing well, and synergies are on track.
Brinks
Brinks
Brinks Revenue by Geographic Location
Forward Guidance
Brink's provided a range of potential revenue and adjusted EBITDA levels for 2020 and 2021 based on recent trends and customer data. The 2020 model includes an adjusted EBITDA range between $465 million and $515 million. The 2021 model includes an adjusted EBITDA range between $615 million and $805 million.
Positive Outlook
- Sequential profit growth in the second half of 2020
- Accelerated revenue growth and margin improvement in 2021
- Full-year benefit of cost realignment in 2021
- Full-year benefit of G4S acquisition in 2021
- Aggressive cost reductions focused on variable costs have already been achieved.
Challenges Ahead
- Predicting the future impact of the pandemic is very difficult
- Concerns about a resurgence of the virus in the U.S and other markets
- Uncertainty about potential revenue and adjusted EBITDA levels
- Potential impact of highly inflationary accounting on Argentina operations
- Potential Non-GAAP adjusting items such as future restructuring actions
Revenue & Expenses
Visualization of income flow from segment revenue to net income