Brink's Reports Second-Quarter Results

RICHMOND, Va., July 25, 2013 /PRNewswire/ -- The Brink's Company (NYSE: BCO), a global leader in security-related services, today reported second-quarter earnings.

Second-Quarter Highlights

GAAP:

• Revenue up 6% (8% organic growth), EPS $.27 vs. $.71
• Segment profit up 4% (6% organic increase), margin 5.5% vs. 5.6%
• International profit up 16% (19% organic increase), margin 6.4% vs. 5.9%
• North America profit down 40% (40% organic decrease), margin 2.8% vs. 4.8%

Non-GAAP:

• Revenue up 6% (8% organic growth), EPS $.44 vs. $.48
• Segment profit up 5% (7% organic increase), margin 5.9% vs. 6%
• International profit up 16% (19% organic increase), margin 6.5% vs. 6.1%
• North America profit down 29% (29% organic decrease), margin 4.1% vs. 5.7%

Tom Schievelbein, chairman, president and chief executive officer, said: "Second-quarter results were in line with our full-year expectations as profit growth from international operations, driven primarily by Latin America, was offset by ongoing weakness in North America.  We expect continued improvement in international operations to enable us to achieve a full-year non-GAAP segment margin rate between 6% and 6.5% on organic revenue growth of 5% to 8%."

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Non-Segment Expenses
Non-segment expenses increased slightly from $21 million to $22 million due to an acquisition gain ($1 million) recognized during 2012.  On a non-GAAP basis, these expenses declined from $12 million to $11 million due to lower general and administrative costs.

Capital Expenditures and Capital Leases
Year-to-date capital expenditures and capital lease additions were $80 million in both periods.  Full-year fixed asset acquisitions are expected to be approximately $205 million versus $203 million in 2012.

Income Taxes
On a GAAP basis, the second-quarter tax expense was $11 million (effective rate of 40%) versus the year-ago quarter's tax benefit of $9 million (negative effective rate of 34%).  This quarter's higher rate reflects the nondeductible remeasurement charge resulting from the Venezuela devaluation recorded in the first quarter, as well as additional devaluation amounts forecasted for 2013.  The prior year's lower rate reflected a non-cash tax benefit related to a change in retiree health care funding strategy.  The effective GAAP tax rate for 2013 is expected to be between 49% and 52%.  

Non-GAAP earnings for the second quarter reflect an effective tax rate of 37.5%, which is the midpoint of the estimated non-GAAP full-year range of 36% to 39%.  Non-GAAP results exclude the aforementioned nondeductible remeasurement charge.

Conference Call
Brink's will host a conference call on July 25 at 11:00 a.m. Eastern Time to review second-quarter results.  Interested parties can listen by calling (800) 860-2442 (domestic), (412) 858-4600 (international), or via live webcast at www.Brinks.com.  Please call in at least five minutes prior to the start of the call.  A replay will be available through August 8, 2013, by calling (877) 344-7529 (domestic) or + (412) 317-0088 (international).  The conference account number is 10030160.  A webcast replay will also be available at www.Brinks.com.

About The Brink's Company
The Brink's Company (NYSE: BCO) is the world's premier provider of secure transportation and cash management services.  For more information, please visit The Brink's Company website at www.Brinks.com or call 804-289-9709.

Non-GAAP Results
Non-GAAP results described in this earnings release are financial measures that are not required by or presented in accordance with U.S. generally accepted accounting principles ("GAAP").  The purpose of the non-GAAP results is to report financial information without certain income and expense items and adjust the quarterly non-GAAP tax rates so that the non-GAAP tax rate in each of the quarters is equal to the full-year non-GAAP tax rate.   For 2013, a forecasted full-year tax rate is used.  The full year non-GAAP tax rate in both years excludes certain pretax and tax income and expense amounts.  The non-GAAP information provides information to assist comparability and estimates of future performance.  Brink's believes these measures are helpful in assessing operations and estimating future results and enable period-to-period comparability of financial performance.  In addition, Brink's believes the measures will help investors assess the ongoing operations.  Non-GAAP results should not be considered as an alternative to revenue, income or earnings per share amounts determined in accordance with GAAP and should be read in conjunction with their GAAP counterparts.

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Forward-Looking Statements

This release contains both historical and forward-looking information.  Words such as "anticipates," "assumes," "estimates," "expects," "projects," "predicts," "intends," "plans," "believes," "potential," "may," "should" and similar expressions may identify forward-looking information.  Forward-looking information in this release includes, but is not limited to, anticipated revenue, segment operating profit, segment margin, non-segment expense, interest expense, income tax rate, non-controlling interest expense, capital expenditures, productivity investments and improvement, capital leases and depreciation and amortization for 2013, future devaluation in Venezuela, anticipated results in the Company's segments and regions, and pending acquisitions, dispositions and related transactions.  Forward-looking information in this document is subject to known and unknown risks, uncertainties and contingencies, which are difficult to predict or quantify, and which could cause actual results, performance or achievements to differ materially from those that are anticipated.

These risks, uncertainties and contingencies, many of which are beyond our control, include, but are not limited to:

• continuing market volatility and commodity price fluctuations and their impact on the demand for our services,
• our ability to continue profit growth in Latin America,
• our ability to maintain or improve volumes at favorable pricing levels and increase cost efficiencies in the United States and Europe,
• investments in information technology and value-added services and their impact on revenue and profit growth,
• our ability to develop and implement solutions for our customers and gain market acceptance of those solutions,
• our ability to maintain an effective IT infrastructure and safeguard confidential information,
• risks customarily associated with operating in foreign countries including changing labor and economic conditions, currency devaluations, safety and security issues, political instability, restrictions on repatriation of earnings and capital, nationalization, expropriation and other forms of restrictive government actions,
• the strength of the U.S. dollar relative to foreign currencies and foreign currency exchange rates,
• the stability of the Venezuelan economy, changes in Venezuelan policy regarding foreign-owned businesses,
• changes in currency restrictions and in foreign exchange rates,
• fluctuations in value of the Venezuelan bolivar fuerte,
• regulatory and labor issues in many of our global operations, including negotiations with organized labor and the possibility of work stoppages,
• our ability to identify and execute further cost and operational improvements and efficiencies in our core businesses,
• our ability to integrate successfully recently acquired companies and improve their operating profit margins,
• costs related to dispositions and market exits,
• our ability to identify acquisitions and other strategic opportunities in emerging markets,
• the willingness of our customers to absorb fuel surcharges and other future price increases,
• our ability to obtain necessary information technology and other services at favorable pricing levels from third party service providers,
• variations in costs or expenses and performance delays of any public or private sector supplier, service provider or customer,
• our ability to obtain appropriate insurance coverage, positions taken by insurers with respect to claims made and the financial condition of insurers, safety and security performance, our loss experience, changes in insurance costs,
• security threats worldwide and losses of customer valuables,
• costs associated with the purchase and implementation of cash processing and security equipment,
• employee and environmental liabilities in connection with our former coal operations, black lung claims incidence,
• the impact of the Patient Protection and Affordable Care Act on black lung liability and the Company's ongoing operations,
• changes to estimated liabilities and assets in actuarial assumptions due to payments made, investment returns, interest rates and annual actuarial revaluations, the funding requirements, accounting treatment, investment performance and costs and expenses of our pension plans, the VEBA and other employee benefits, mandatory or voluntary pension plan contributions,
• the nature of our hedging relationships,
• changes in estimates and assumptions underlying our critical accounting policies,
• our ability to realize deferred tax assets,
• the outcome of pending and future claims and litigation,
• public perception of the Company's business and reputation,
• access to the capital and credit markets,
• seasonality, pricing and other competitive industry factors, and
• the promulgation and adoption of new accounting standards and interpretations, new government regulations and interpretations of existing regulations.

This list of risks, uncertainties and contingencies is not intended to be exhaustive.  Additional factors that could cause our results to differ materially from those described in the forward-looking statements can be found under "Risk Factors" in Item 1A of our Annual Report on Form 10-K for the period ended December 31, 2012, and in our other public filings with the Securities and Exchange Commission.  The forward-looking information included in this document is representative only as of the date of this document and The Brink's Company undertakes no obligation to update any information contained in this document.

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