Good Times Continue for Cash Industry Leaders

Each February it is customary in Currency News™ to cover the annual results for 2022 for the leading companies in cash management, which is when most are published, with their success (or otherwise) providing a useful means of taking the pulse of our industry.

2019 was a year characterised by strong results and optimistic outlooks. That optimism was overturned in 2020 when COVID struck, but 2021 saw a rebound. We are glad to report that, for the five companies whose results we report here, 2022 was another good one, for some of them at least.

Brinks breaks records - again

For 2012, Brinks announced record sales and profits. It has surpassed these for 2022.

Revenue in 2022 increased by 8% to $4.53 billion, of which 12% represented organic growth. Operating profit (GAAP) increased by 2% to $361 million, with non-GAAP operating profit increasing by 17% to $550 million. The GAAP operating margin decreased slightly, from 8.4% in 2021 to 8% in 2022, but the non-GAAP operating margin increased from 11.2% to 12.1% - the highest operating margin in the company’s recent history.

All regions showed sales growth (GAAP) – North America +13%, Latin America +8%, Europe +2% and the Rest of the World +8%. The negative currency effect overall on sales was $252 million. Similarly, all regions showed gains in operating profit (GAAP) – North America +7%, Latin America +8%, Europe +10% and the Rest of the World +25%.

Mark Eubanks, President and CEO, described the year’s results as outstanding, and provide solid momentum for 2023.

Revenue growth included 25% organic growth in digital retail solutions and 50% organic growth in ATM managed services – which he described as key strategic focus areas for Brinks.

For 2023, he indicated revenue growth of 7-11% and adjusted operating profit (EBITDA) between $855 and $905 million.

Loomis flying high too

Revenue for Loomis for the year of SEK 25.3 billion was 28.4% higher than for 2021. Real growth of 15.9% was 6% higher than the 9.9% achieved in 2021, of which organic growth was 14.4% (compared with 11.8% in 2021) and acquisitions and divestments 1.4% (versus 0.3% in 2021). Revenue was positively affected by higher sales in both Europe and Latin America and the USA.

Operating income (EBITA) for 2022 amounted to SEK 2.73 billion, an increase of just under 40% , with the operating margin increasing from 9.9% to 10.8%. Net profit for 2022 was SEK 1.6 billion, a 45% increase.

Some of the success was attributed to societies opening up after the pandemic, leading to strong growth in cash volumes, including foreign exchange for tourists.

Aritz Larrea, President and CEO, said: ‘Loomis delivered another strong quarter which resulted in the full year 2022 achieving the highest revenue and operating result ever. We have a strong financial position and are well positioned to capitalise on the consolidation, outsourcing and innovation in our industry’.

And so is NCR

Revenue for the year increased by 9.5% to $7.83 billion (excluding revenue from the company’s operations in Russia of $9 million). Full year adjusted (non GAAP) operating profit (EBITDA) increased by 10% to $1.37 billion, with the margin increasing from 17.4% to 17.5%. Full year net income from continuing operations attributable to NCR declined by 34% to $64 million.

Last year, NCR was poised for a takeover, but subsequently announced a plan to separate into two independent, publicly traded companies, one focused on digital commerce, the other on ATMs. The current target is to complete the separation by the end of 2023.

Michael Hayford, CEO, said of 2022: ‘we delivered solid financial performance, made progress on our strategy to NCR becoming a Software-as-a-Service (SAAS) company with higher recurring revenue streams……We enter 2023 with products winning in the market and positive momentum’.

The outlook for 2023 indicates revenue of $7.8-8 billion and adjusted EBITDA of $1.45-1.55 billion.

Diebold Nixdorf struggles continue

Reversing that trend was Diebold Nixdorf, whose difficulties over the past few years appear to be continuing.

The company has two main markets – Banking and Retail, for which it provides both services and products. Sales revenue declined in 2022 compared with 2021 in both Banking and Retail, and in services and products.

By market, Banking revenue declined by 10.6% to $2.4 billion, and in Retail by 13% to $1.01 billion. By product group, Services declined by just under 9% to $2.09 billion and Products by 15% to $1.361 billion. Total revenue declined by 11.4% to $3.46 billion and an operating profit of $137.1 million in 2021 turned into a loss of $211.7 million in 2022.

Crane preps for separation

Sales for Crane Co for 2023 were $3.37 billion, a 1% decrease over 2021. Core sales growth of $200 million (+6%) was more than offset by the $139 million (4%) impact from the divestment of Crane Supply in May, and a $114 million (3%) impact from unfavourable foreign exchange.

Full year operating profit fell from $529 million (operating margin 15.5%) to $370 million (operating margin 10.9%), driven primarily by the loss on the divestment of asbestos-related assets and liabilities, while adjusted operating profit (non GAAP) increased from $528 million to $597 million, an increase in operating margin from 15.5% to 17.7%.

Sales in the Payment and Merchandising Technologies business sector decreased by 0.39% to $1.34 billion, but the operating profit increased by 8.3% to $333.1 million, taking the operating margin from 22.86% to 24.86%.

The order backlog at year end increased by 29% from $438 million in 2021 to $565.6 million at year end 2022.

Crane is continuing its progress towards the previously announced separation of the company, which remains on track for completion in early April. Crane Company will incorporate the Aerospace & Electronics, Process Flow Technologies, and Engineered Materials segments of the existing companies. Crane NXT will be the vehicle for Payment and Merchandising Technologies, which includes Crane Currency, Crane Payment Innovations and what was Cummins Allision.

In the March issue we will report the annual results of Glory, Prosegur and Spectra Systems.