Edgar Filing: BRINKS CO

Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)



	ý	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
		For the fiscal year ended December 31, 2018



	¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
		SECURITIES EXCHANGE ACT OF 1934
		For the transition period from ____________ to ____________

Commission file number 001-09148

THE BRINK’S COMPANY

(Exact name of registrant as specified in its charter)



	Virginia		54-1317776
	(State or other jurisdiction of		(I.R.S. Employer
	incorporation or organization)		Identification No.)

	P.O. Box 18100,
	1801 Bayberry Court
	Richmond, Virginia		23226-8100
	(Address of principal executive offices)		(Zip Code)

	Registrant’s telephone number, including area code		(804) 289-9600

	Securities registered pursuant to Section 12(b) of the Act:
			Name of each exchange on
	Title of each class		which registered
	The Brink’s Company Common Stock, Par Value $1		New York Stock Exchange

	Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes ý No ¨

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes ¨ No ý

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ý No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ý No ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ý

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ý Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ¨ Emerging Growth Company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ¨ No ý

As of February 21, 2019, there were issued and outstanding 49,645,065 shares of common stock. The aggregate market value of shares of common stock held by non-affiliates as of June 30, 2018, was $4,026,184,093.

Documents incorporated by reference: Part III incorporates information by reference from portions of the Registrant’s definitive 2019 Proxy Statement to be filed pursuant to Regulation 14A.

THE BRINK’S COMPANY

FORM 10-K

FOR THE YEAR ENDED DECEMBER 31, 2018

TABLE OF CONTENTS



	PART I	Page
Item 1.	Business	1
Item 1A.	Risk Factors	8
Item 1B.	Unresolved Staff Comments	13
Item 2.	Properties	14
Item 3.	Legal Proceedings	14
Item 4.	Mine Safety Disclosures	14

	Executive Officers of the Registrant	15

	PART II

Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	16
Item 6.	Selected Financial Data	18
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	57
Item 8.	Financial Statements and Supplementary Data	58
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	122
Item 9A.	Controls and Procedures	122
Item 9B.	Other Information	122

	PART III

Item 10.	Directors, Executive Officers and Corporate Governance	123
Item 11.	Executive Compensation	123
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	123
Item 13.	Certain Relationships and Related Transactions, and Director Independence	123
Item 14.	Principal Accountant Fees and Services	123

	PART IV

Item 15.	Exhibits and Financial Statement Schedules	124
Item 16.	Form 10-K Summary	124

PART I

ITEM 1. BUSINESS

Overview

The Brink’s Company is the global leader in total cash management^(a), route-based logistics and payment solutions including cash-in-transit, ATM services, cash management services, including vault outsourcing, money processing, and intelligent safe services, and international transportation of valuables. Our customers include financial institutions, retailers, government agencies (including central banks), mints, jewelers and other commercial operations around the world. Our global network serves customers in more than 100 countries. We have controlling ownership interests in companies in 41 countries and agency relationships with companies in additional countries. We employ approximately 62,400 people and our operations include approximately 1,200 facilities and 13,500 vehicles.

Brink’s was founded in 1859 and The Brink’s Company was first incorporated in 1930 under the laws of the State of Delaware (at that time, the Company was named The Pittston Company). It succeeded to the business of a Virginia corporation in 1986 and was renamed The Brink’s Company in 2003. Our headquarters are located in Richmond, Virginia. The Brink’s Company, along with its subsidiaries, is referred to as “we,” “our,”, “us,” “Brink’s,” or “the Company” throughout this Form 10-K.


(a)	Based on publicly available company data for cash services businesses.

Vision, Mission and Strategy

Our Vision

To be the global leader in total cash management, route-based logistics and payment services.

Our Strategy

Our strategy is to:


•	Accelerate profitable growth ("APG")


•	Close the gap with operational excellence ("CTG")


•	Introduce differentiated services ("IDS")

We will accelerate profitable growth by:


•	growing high-value services


•	growing account share with existing customers


•	increasing our focus on smaller financial institutions


•	penetrating the large, unvended retail market


•	exploring core and adjacent acquisition opportunities

We have opportunities to grow revenue in higher-margin lines of business such as money processing outsourcing, CompuSafe^® services and recyclers, and Brink’s global services. Our plan calls for growing revenue with both large and small financial institutions, and increasing penetration of the large and underserved retail market. We also have the financial flexibility to pursue accretive acquisitions in both core and adjacent markets.

Close the gap with operational excellence by:


•	exceeding customer expectations


•	leading our industry in safety and security


•	increasing operational productivity to achieve operational excellence

We are on track in our efforts to improve internal productivity, optimize cost and achieve industry-leading margins.

Introduce differentiated services through:


•	leveraging uniform, best-in-class global technology base for logistics and operating systems


•	offering end-to-end cash supply chain managed services


•	launching a customer portal and app to support value-added, fee-based services

The third component of our strategy is to introduce differentiated services to our customers by strengthening and leveraging our IT capabilities. Our IT strategy and systems will also drive improved service levels and operational efficiencies.

The actions taken to execute the components of our strategy include internal breakthrough initiatives such as more efficient vehicles, one-person crews and more effective IT processes leading to lower operating costs. We have also completed eight acquisitions in our core markets.

Services

We design customized services to meet the cash and valuables supply chain needs of our customers. We enter into contracts with our customers to establish pricing and other terms. Cash-in-transit and ATM contracts usually cover an initial term of at least one year and in many cases one to three years, and generally remain in effect thereafter until canceled by either party. Contracts for cash management services are typically longer. Following are descriptions of our service offerings:

Core Services (49% of total revenues in 2018)

Cash-in-transit ("CIT") and ATM services are core services we provide to customers throughout the world. We charge customers per service performed or based on the value of goods transported. Revenues are affected by the level of economic activity in various markets as well as the volume of business for specific customers. Core services generated approximately $1.7 billion of revenues in 2018 ($1.6 billion in 2017 and $1.5 billion in 2016).

Cash-in-transit services – Serving customers since 1859, our success in CIT is driven by a combination of rigorous security practices, high-quality customer service, risk management and logistics expertise. Cash-in-transit services generally include the secure transportation of:


•	cash between businesses and financial institutions, such as banks and credit unions


•	cash, securities and other valuables between commercial banks, central banks and investment banking and brokerage firms


•	new currency, coins, bullion and precious metals for central banks and other customers

ATM services – We manage 128,400 ATMs worldwide. We provide customers who own and operate ATMs a variety of service options. Basic ATM management services include cash replenishment and first and second line maintenance. We also provide comprehensive services for ATM management including cash replenishment, replenishment forecasting, cash optimization, ATM remote monitoring, service call dispatching, transaction processing, installation services, and first and second line maintenance.

High-Value Services (45% of total revenues in 2018)

Our Core Services, combined with our brand and global infrastructure, provide a broad platform from which we offer additional high-value services, which generated approximately $1.6 billion of revenues in 2018 ($1.5 billion in 2017 and $1.3 billion in 2016).

Global services - Brink’s global services ("BGS") is the leading global provider of secure transport of highly-valued commodities including diamonds, jewelry, precious metals, securities, currency, high-tech devices, electronics and pharmaceuticals. Our specialized diamond and jewelry operations have offices in the world’s major diamond and jewelry centers. Serving customers in more than 100 countries, BGS provides secure transportation services including pick-up, packaging, customs clearance, secure vault storage and inventory management. BGS uses a combination of armored vehicles and secure air and sea transportation.

Cash management services - We offer a variety of cash management services, depending on customers’ unique needs. These include:


•	money processing (e.g., counting, sorting, wrapping, checking condition of bills, etc.) and other cash management services


•	services related to deploying and servicing “intelligent” safes and safe control devices, including our patented CompuSafe^® service


•	check imaging services

Other cash management services include cashier balancing, counterfeit detection, account consolidation and electronic reporting. Retail and bank customers use Brink’s to count and reconcile coins and currency, prepare bank deposit information and replenish coins and currency in specific denominations.

Brink's offers a fully integrated approach to managing customers' supply chain of cash. These services include logistical support from point-of-sale through transport, vaulting, bank deposit and related credit reporting. We also offer a variety of technology applications including online cash tracking, cash inventory management, check imaging for real-time deposit processing, and a variety of other web-based tools that enable banks and other customers to reduce costs while improving service to their customers. We believe the quality and scope of our money processing and information systems differentiate our cash management services from competitive offerings.

Brink’s CompuSafe^® service –We manage 34,500 installed Compusafes devices worldwide. Brink’s CompuSafe^® service provides an integrated, closed-loop system for minimizing theft and managing cash. We market CompuSafe^® services to a variety of cash-intensive customers including convenience stores, gas stations, restaurants, retail chains and entertainment venues. In a majority of instances, once the specialized safe is installed, the customer’s employees deposit currency into the safe’s cassettes, which can only be officially removed by Brink’s personnel or in some instances, securely by customer employees. Upon removal, the cassettes are securely transported to a vault for processing where contents are verified and transferred for deposit. Our CompuSafe^® service features currency-recognition and counterfeit-detection technology, multi-language touch screens and in some instances, an electronic interface between the point-of-sale, back-office systems and external banks. Our electronic reporting interface with external banks enables customers to receive same-day credit on their cash balances, even if the cash remains on the customer’s premises.

Vaulting services. Vaulting services combine cash-in-transit services, cash management services, vaulting and electronic reporting technologies to help banks expand into new markets while minimizing investment in vaults and branch

facilities. In addition to providing secure storage, we process deposits, provide check imaging and reconciliation services, perform currency inventory management, process ATM replenishment orders and electronically transmit banking transactions.

Payment services – We provide convenient payment services, including bill payment processing, mobile phone top-up, and Brink’s Money™ prepaid cards.

Bill payment processing services include bill payment acceptance and processing services on behalf of utility companies and other billers. Consumers can pay bills, top-up prepaid mobile phones and manage accounts at retail agent locations that we operate on behalf of utility companies, banks and a small number of leased payment locations. This service is offered at over 24,300 locations in Brazil, Colombia, Panama and Mexico.

We offer Brink’s Money™ general purpose reloadable prepaid cards and payroll cards to consumers and employers in the U.S. Our general purpose reloadable cards are sold to consumers through our direct-to-consumer marketing efforts while our payroll cards are sold to employers who use them to pay employees electronically. Brink’s Money™ cards can be used at stores, restaurants, online retailers, and at ATMs worldwide. This product is targeted to the millions of unbanked and under-banked Americans looking for alternative financial products.

Other Security Services (6% of total revenues in 2018)

Guarding – We protect airports, offices, warehouses, stores, and public venues with or without electronic surveillance, access control, fire prevention and trained patrolling personnel. Other security services generated approximately $0.2 billion of revenues in 2018 ($0.2 billion in 2017 and 2016).

We offer security and guarding services in Luxembourg, Greece and Brazil. A portion of this business involves long-term contracts related primarily to security services at airports and embassies. Generally, guarding contracts are for a one-year period, and the majority of contracts are extended.

Commercial security systems – We provide commercial security system services in designated markets in Europe. Our security system design and installation services include alarms, motion detectors, closed-circuit televisions, digital video recorders, and access control systems, including card and biometric readers, electronic locks, and turnstiles. We may also provide monitoring services after systems have been installed.

Industry and Competition

Brink’s competes with large multinational, regional and smaller companies throughout the world. Our largest multinational competitors are G4S plc (U.K.); Loomis AB (Sweden); Prosegur, Compania de Seguridad, S.A. (Spain); and Garda World Security Corporation (Canada).

We believe the primary factors in attracting and retaining customers are security expertise, service quality, and price. Our competitive advantages include:


•	brand name recognition


•	reputation for a high level of service and security


•	risk management and logistics expertise


•	global network and customer base


•	proven operational excellence, and


•	high-quality insurance coverage and financial strength

Although we face competitive pricing pressure in many markets, we resist competing on price alone. We believe our high levels of service, security expertise and value-added solutions differentiate us from competitors.

Insurance Coverage

The availability of high-quality and reliable insurance coverage is an important factor in our ability to attract and retain customers and manage the risks inherent in our business. We purchase insurance coverage for losses in excess of what we consider to be prudent levels of self-insurance. Our insurance policies cover losses from most causes, with the exception of war, nuclear risk and certain other exclusions typical in such policies.

Insurance for security is provided by different groups of underwriters at negotiated rates and terms. Premiums fluctuate depending on market conditions. The security loss experience of Brink’s and, to a limited extent, other armored carriers affects our premium rates.

Service Mark and Patents

BRINKS is a registered service mark in the U.S. and certain foreign countries. The BRINKS mark, name and related marks are of material significance to our business. We own patents for safes and related services, iDeposit and Daily Credit processes, including our integrated CompuSafe^® service, which expire between 2022 and 2033. These patents provide us with important advantages. However, we are not dependent on the existence of these patents.

We have licensed the Brink’s name to a limited number of companies, including a company that provides residential smart home and home security services and a distributor of security products (padlocks, door hardware, etc.) to customers through major retail chains.

Government Regulation

Our U.S. operations are subject to regulation by the U.S. Department of Transportation with respect to safety of operations, equipment and financial responsibility. Intrastate operations in the U.S. are subject to state regulation. Operations outside of the United States are regulated to varying degrees by the countries in which we operate.

Employee Relations

At December 31, 2018, our company had approximately 62,400 full-time and contract employees, including approximately 11,700 employees in the United States (of whom approximately 3,000 were classified as part-time employees) and approximately 50,700 employees outside the United States. At December 31, 2018, Brink’s was a party to nine collective bargaining agreements in Canada with various local unions covering approximately 1,400 employees. The agreements have various expiration dates from 2019 to 2022. Outside of Canada, approximately 49% of employees are represented by trade union organizations. We believe our employee relations are satisfactory.

Business Divestitures

Below is a summary of the significant businesses we exited in the last three years. These divestitures did not meet the criteria for classification as discontinued operations. Operating results for these businesses are included in continuing operations for all periods presented, as applicable. We continue to operate our global services business in each of these countries.


•	In September 2016, we shut down the remaining operations in the Republic of Ireland and Northern Ireland. During 2016, we incurred approximately $16 million in losses as we exited these operations. These losses included $5 million in severance costs and $2 million in property impairment charges. During 2017, additional losses incurred related to the Ireland operations were not significant.


•	We sold a German guarding operation in October 2016.


•	We sold a French airport security services business in June 2018 and recognized a gain of approximately $11 million.


•	In August 2018, we shut down an operation based in the Netherlands that provided security solutions for domestic and international cargo transportation.

Business Acquisitions

In August 2018, we acquired 100% of the capital stock of Dunbar Armored, Inc. ("Dunbar") for approximately $547 million. Dunbar is a U.S. cash management business. In December 2018, we acquired 60% of the shares of Worldbridge Secure Logistics Co., Ltd. ("Worldbridge"), a Cambodian company that provides CIT and money processing services. In 2017, we acquired six business operations in five countries for an aggregate purchase price of approximately $361 million. Below is a brief description of each of the six business acquisitions completed in 2017:


•	In March 2017, we acquired 100% of the capital stock of American Armored Transport, Inc. ("AATI"). AATI provides secured trucking transportation of high-value cargo within the continental United States.


•	We acquired 100% of the capital stock of Muitofacil Holding Ltda., a Brazil-based holding company, and its subsidiary, Muitofacil Arrecadacao e Recebimento Ltda. (together "Pag Facil") in April 2017. Pag Facil offers bank correspondent services, bill payment processing and mobile phone top-up services in Brazil.


•	In June 2017, we acquired 100% of the capital stock of Global Security S.A. (“LGS”). LGS is a Chilean security company specializing

in CIT and ATM services.


•	We acquired 100% of the shares of Maco Transportadora de Caudales S.A. ("Maco Transportadora") in July 2017. Maco Transportadora is a CIT and money processing business based in Argentina.


•	In August 2017, we acquired 100% of the capital stock of Maco Litoral, S.A., an Argentina-based company which provides CIT and ATM services.


•	We acquired 100% of the shares of Temis S.A.S. and its wholly-owned subsidiaries, Les Goelands S.A.S. and Temis Conseil et Formation S.A.R.L (together "Temis") in October 2017. Temis provides CIT and money processing services in France.

See Note 7 to the consolidated financial statements for more detailed information on the acquired assets and liabilities from these acquisitions.

In November 2018, we completed the acquisition of the 42% noncontrolling interest in our consolidated subsidiary, Brink's de Colombia, S.A. We now own 100% of the shares of this subsidiary, and we accounted for this increase in ownership interest as an equity transaction.

In January 2019, we acquired 100% of the capital stock of Rodoban Transportes Aereos e Terrestres Ltda., Rodoban Servicos e Sistemas de Seguranca Ltda., and Rodoban Seguranca e Transporte de Valores Ltda. (together "Rodoban") for approximately $130 million. Rodoban provides CIT, money processing and ATM services primarily in southeastern Brazil.

Reorganization and Restructuring

In the fourth quarter of 2016, management implemented restructuring actions across our global business operations and our corporate functions (“2016 Reorganization and Restructuring”). As a result of these actions, we recognized $18.1 million in related 2016 costs and an additional $17.3 million in 2017 under this restructuring related to severance, asset-related adjustments, a benefit program termination and lease terminations. We recognized an additional $13.0 million of costs in 2018 under this restructuring for severance costs and asset-related adjustments. The actions under the 2016 Reorganization and Restructuring were substantially completed in 2018, with cumulative pretax charges of approximately $48 million. Severance actions reduced our global workforce by approximately 800 positions.

Management initiated a global restructuring of our business in the third quarter of 2015 (“2015 Reorganization and Restructuring”). We recognized $6.5 million of costs in 2016 related to this restructuring for severance costs, contract terminations and lease terminations. The 2015 Reorganization and Restructuring reduced the global workforce by approximately 1,100 positions and resulted in approximately $20 million in 2016 cost savings. The actions under this program were substantially completed by the end of 2016, with cumulative pretax charges of approximately $18 million.

Executive Leadership and Board of Directors Restructuring

In January 2016, Brink’s entered into an agreement (the "Starboard Agreement") with Starboard Value LP and its affiliates ("Starboard"). As a result, our former Chief Executive Officer ("CEO"), Thomas C. Schievelbein, stepped down in May 2016, and two of the Company’s directors (including the Company’s independent lead director at that time) retired from the Board. Pursuant to the Starboard Agreement, among other things, the Board appointed three new independent directors and delegated to the Board’s Corporate Governance and Nominating Committee the responsibility to oversee the Board's process to search for a new CEO. In June 2016, the Board appointed Douglas A. Pertz as the Company’s president and CEO and as a member of the Board. In July 2016, Ronald J. Domanico replaced Joseph W. Dziedzic as Chief Financial Officer. In 2016, we recognized $4.3 million in costs related to the Executive Leadership and Board of Directors restructuring, primarily severance costs.

Other Restructurings

Management periodically implements restructuring actions in targeted sections of our business. As a result of these actions, we recognized costs of $4.6 million in 2017 and $7.6 million in 2018, primarily severance costs. For the current restructuring actions, we expect to incur additional costs between $5 million and $7 million in future periods. These estimates will be updated as management targets additional sections of our business.

Available Information and Corporate Governance Documents

The following items are available free of charge on our website (www.brinks.com) as soon as reasonably possible after filing or furnishing them with the Securities and Exchange Commission (the “SEC”):


•	Annual reports on Form 10-K


•	Quarterly reports on Form 10-Q


•	Current reports on Form 8-K, and amendments to those reports

The following documents are also available free of charge on our website:


•	Corporate Governance Policies


•	Code of Ethics


•	The charters of the following committees of our Board of Directors (the “Board”): Audit and Ethics, Compensation and Benefits, Corporate Governance and Nominating, and Finance and Strategy

Printed versions of these items will be mailed free of charge to shareholders upon request. Such requests can be made by contacting the Corporate Secretary at 1801 Bayberry Court, P. O. Box 18100, Richmond, Virginia 23226-8100.

Additional information about the Company may be found elsewhere in this report and the Company's other public filings, which are available without charge through the SEC's website at http://www.sec.gov.

ITEM 1A. RISK FACTORS

We operate in highly competitive industries.

We compete in industries that are subject to significant competition and pricing pressures in most markets. In addition, our business model requires significant fixed costs associated with offering many of our services including costs to operate a fleet of armored vehicles and a network of secure branches. Because we believe we have competitive advantages such as brand name recognition and a reputation for a high level of service and security, we resist competing on price alone. However, continued pricing pressure from competitors or failure to achieve pricing based on the competitive advantages identified above could result in lost volume of business and have an adverse effect on our business, financial condition, results of operations and cash flows. In addition, given the highly competitive nature of our industries, it is important to develop new solutions and product and service offerings to help retain and expand our customer base. Failure to develop, sell and execute new solutions and offerings in a timely and efficient manner could also negatively affect our ability to retain our existing customer base or pricing structure and have an adverse effect on our business, financial condition, results of operations and cash flows.

Decreased use of cash could have a negative impact on our business.

While cash remains the most popular form of consumer payment in the U.S. and globally, the growth of payment options other than cash could reduce the need for services related to cash, thereby affecting our financial results. We are developing new services that offer current and prospective customers with opportunities to streamline their cash processing costs, making cash more competitive with other forms of payment. There is a risk that these initiatives may not offset the risks associated with our traditional cash-based business and that our business, financial condition, results of operations and cash flows could be negatively impacted.

Our strategy may not be successful.

Our strategy has three pillars: accelerate profitable growth, close the gap with competitors and introduce differentiated services. We may not be successful in growing revenue in high-margin lines of business, increasing our market share with existing customers or winning new business with smaller financial institutions and the retail market. Although we are improving productivity and optimizing costs, we may not be able to achieve industry-leading margins. We also may not be successful in strengthening and leveraging our IT capabilities to improve service levels and drive efficiencies. If we are unable to achieve our strategic objectives and anticipated operating profit improvements, our results of operations and cash flows may be adversely affected.

We have significant operations outside the United States.

We currently serve customers in more than 100 countries, including 41 countries where we operate subsidiaries. Seventy-three percent (73%) of our revenues in 2018 came from operations outside the U.S. We expect revenues outside the U.S. to continue to represent a significant portion of total revenues. Business operations outside the U.S. are subject to political, economic and other risks inherent in operating in foreign countries, such as:


•	the difficulty of enforcing agreements, collecting receivables and protecting assets through foreign legal systems;


•	trade protection measures and import or export licensing requirements;


•	difficulty in staffing and managing widespread operations;


•	required compliance with a variety of foreign laws and regulations;


•	enforcement of our global compliance program in foreign countries with a variety of laws, cultures and customs;


•	varying permitting and licensing requirements in different jurisdictions;


•	foreign ownership laws;


•	changes in the general political and economic conditions in the countries where we operate, particularly in emerging markets;


•	threat of nationalization and expropriation;


•	higher costs and risks of doing business in a number of foreign jurisdictions;


•	laws or other requirements and restrictions associated with organized labor;


•	limitations on the repatriation of earnings;


•	fluctuations in equity, revenues and profits due to changes in foreign currency exchange rates, including measures taken by governments to devalue official currency exchange rates;


•	inflation levels exceeding that of the U.S; and


•	inability to collect for services provided to government entities.

We are exposed to certain risks when we operate in countries that have high levels of inflation, including the risk that:


•	the rate of price increases for services will not keep pace with the cost of inflation;


•	adverse economic conditions may discourage business growth which could affect demand for our services;


•	the devaluation of the currency may exceed the rate of inflation and reported U.S. dollar revenues and profits may decline; and


•	these countries may be deemed “highly inflationary” for U.S. generally accepted accounting principles (“GAAP”) purposes.

We manage these risks by monitoring current and anticipated political and economic developments, monitoring adherence to our global compliance program and adjusting operations as appropriate. Changes in the political or economic environments of the countries in which we operate could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our business success depends on retaining our leadership team and attracting and retaining qualified personnel.

Our future success depends, in part, on the continuing services and contributions of our leadership team to execute on our strategic plan and to identify and pursue new opportunities. Our future success also depends, in part, on our continued ability to attract and retain highly skilled and qualified personnel. Any turnover in senior management or inability to attract and retain qualified personnel could have a negative effect on our results of operations. Turnover in key leadership positions within the Company may adversely affect our ability to manage the company efficiently and effectively, could be disruptive and distracting to management and may lead to additional departures of current personnel, any of which could have a material adverse effect on our business and results of operations.

We may be unable to achieve, or may be delayed in achieving, our initiatives to drive efficiency and control costs.

We have launched a number of initiatives, including the reorganization and restructuring actions described on page 6, to improve efficiencies and reduce operating costs. Although we have achieved annual cost savings associated with these initiatives, we may be unable to sustain the cost savings that we have achieved. In addition, if we are unable to achieve, or have any unexpected delays in achieving additional cost savings, our results of operations and cash flow may be adversely affected. Even if we meet our goals as a result of these initiatives, we may not receive the expected financial benefits of these initiatives.

We may not be successful in pursuing strategic investments or acquisitions or realize the expected benefits of those transactions because of integration difficulties and other challenges.

While we may identify opportunities for acquisitions and investments to support our growth strategy, as well as divestiture opportunities, our due diligence examinations and positions that we may take with respect to appropriate valuations for acquisitions and divestitures and other transaction terms and conditions may hinder our ability to successfully complete business transactions to achieve our strategic goals. Our ability to realize the anticipated benefits from acquisitions will depend, in part, on successfully integrating each business with our company as well as improving operating performance and profitability through our management efforts and capital investments. The risks to a successful integration and improvement of operating performance and profitability include, among others, failure to implement our business plan, unanticipated issues in integrating operations with ours, unanticipated changes in laws and regulations, labor unrest resulting from union operations, regulatory, environmental and permitting issues, unfavorable customer reactions, the effect on our internal controls and compliance with the regulatory requirements under the Sarbanes-Oxley Act of 2002, and difficulties in fully identifying and evaluating potential liabilities, risks and operating issues. The occurrence of any of these events may adversely affect our expected benefits of any acquisitions and may have a material adverse effect on our financial condition, results of operations or cash flows.

We have significant deferred tax assets in the United States that may not be realized.

Deferred tax assets are future tax deductions that result primarily from the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial statement and income tax purposes. At December 31, 2018, we had $178 million of U.S. deferred tax assets, net of valuation allowances, primarily related to our retirement plan obligations. These future tax deductions may not be realized if tax rules change in the future, or if forecasted U.S. operational results or any other U.S. projected future taxable income is insufficient. Consequently, not realizing our U.S. deferred tax assets may significantly and materially affect our financial condition, results of operations and cash flows.

It is possible that we will incur restructuring charges in the future.

It is possible that we will take restructuring actions in one or more of our markets in the future to reduce expenses. These actions could result in significant restructuring charges at these subsidiaries, including recognizing impairment charges to write down assets, and recording accruals for employee severance and the termination of operating leases. These charges, if required, could significantly and materially affect results of operations and cash flows.

We have significant retirement obligations. Poor investment performance of retirement plan holdings and / or lower interest rates used to discount the obligations could unfavorably affect our liquidity and results of operations.

We have substantial pension and retiree medical obligations, a portion of which have been funded. The amount of these obligations is significantly affected by factors that are not in our control, including interest rates used to determine the present value of future payment streams, investment returns, medical inflation rates, participation rates and changes in laws and regulations. The funded status of the primary U.S. pension plan was approximately 87% as of December 31, 2018. Based on our actuarial assumptions at the end of 2018, we do not expect to make contributions until 2022. A change in assumptions could result in funding obligations that could adversely affect our liquidity and our ability to use our resources to make acquisitions and to otherwise grow our business.

We have $702 million of actuarial losses recorded in accumulated other comprehensive income (loss) at the end of 2018. These losses relate to changes in actuarial assumptions that have increased the net liability for benefit plans. These losses have not been recognized in earnings. These losses will be recognized in earnings in future periods to the extent they are not offset by future actuarial gains. Our projections of future cash requirements and expenses for these plans could be adversely affected if our retirement plans have additional actuarial losses.

Our earnings and cash flow could be materially affected by increased losses of customer valuables.

We purchase insurance coverage for losses of customer valuables for amounts in excess of what we consider prudent deductibles and/or retentions. Insurance is provided by different groups of underwriters at negotiated rates and terms. Coverage is available to us in major insurance markets, although premiums charged are subject to fluctuations depending on market conditions. Our loss experience and that of other companies in our industry affects premium rates. We are not insured for losses below our coverage limits and recognize expense up to these limits for actual losses. Our insurance policies cover losses from most causes, with the exception of war, nuclear risk and various other exclusions typical for such policies. The availability of high-quality and reliable insurance coverage is an important factor in obtaining and retaining customers and managing the risks of our business. If our losses increase, or if we are unable to obtain adequate insurance coverage at reasonable rates, our financial condition, results of operations and cash flows could be materially and adversely affected.

Risks associated with information technology can expose Brink’s to business disruptions, cybersecurity breaches and regulatory violations.

We rely on our information technology ("IT") infrastructure. If there were to be significant problems with our infrastructure, such as IT datacenter or system failure, or failure to develop new technology platforms to support new initiatives and product and service offerings, it could halt or delay our ability to service our customers, hinder our ability to conduct and expand our business and require significant remediation costs. Our data security risks will increase as we employ emerging technologies, mobile applications, third-party service providers and cloud-based services. If any of these risks were to materialize, it could have a material adverse effect on our business, financial condition, results of operations and cash flows.

In addition, in the normal course of business, we collect, process and retain sensitive and confidential information. Hacking, phishing attacks, ransomware, insider threats, physical breaches or other actions may cause confidential information belonging to Brink’s, its employees or customers to be misused. If risks such as these materialize, we may incur significant challenges and costs related to coordination with third-party service providers in order to resolve related issues. If our third-party providers do not respond in a timely manner to our needs, disaster recovery, business continuity and crisis management activities could be negatively impacted. We have programs in place that are intended to detect, contain and respond to cybersecurity breaches and that provide employee awareness training regarding cyber risks; however, due to evolving and advanced sophisticated attack vectors, cyber attacks remain increasingly difficult to detect and we may not be able to successfully defend against them. Any cybersecurity breach, whether by us or by third-party service providers, could damage our reputation, expose us to the risks of litigation and liability, disrupt our business or otherwise have a material adverse effect on our business, financial condition, results of operations and cash flows.

As a global company we must adhere to applicable laws and regulations in numerous regions regarding data privacy, data protection, and data security. Privacy and data protection laws vary between countries and are subject to interpretation, which may create inconsistent or conflicting requirements. The European Union’s General Data Protection Regulation (“GDPR”) greatly increases the jurisdictional reach of European Union law and became effective in May 2018. GDPR imposes requirements related to the handling of personal data, mandates public disclosure of significant data breaches, and provides for substantial penalties for non-compliance. Our efforts to comply with GDPR and other privacy and data protection laws may impose significant costs that are likely to increase over time, and we could incur substantial penalties or litigation related to violation of existing or future data privacy laws, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Negative publicity to our name or brand could lead to a loss of revenues or profitability.

We are in the security business and our success and longevity are based to a large extent on our reputation for trust and integrity. Our reputation or brand, particularly the trust placed in us by our customers, could be negatively impacted in the event of perceived or actual breaches in our ability to conduct our business ethically, securely and responsibly. In addition, we have licensing arrangements that permit certain entities to use Brink’s name and/or other intellectual property in connection with their businesses. If any of these entities experienced an actual or perceived breach in its ability to conduct its business ethically, securely or responsibly, it could have a negative effect on our name and/or brand. Any damage to our brand could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We operate in regulated industries.

Our U.S. operations are subject to regulation by the U.S. Department of Transportation with respect to safety of operations and equipment and financial responsibility. Intrastate operations in the U.S. are subject to regulation by state regulatory authorities and interprovincial operations in Canada are subject to regulation by Canadian and provincial regulatory authorities. Our other international operations are regulated to varying degrees by the countries in which we operate. Many countries have permit requirements for security services and prohibit foreign companies from providing different types of security services.

Changes in laws or regulations could require a change in the way we operate, which could increase costs or otherwise disrupt operations. In addition, failure to comply with any applicable laws or regulations could result in substantial fines or revocation of our operating permits and licenses. If laws and regulations were to change or we failed to comply, our business, financial condition, results of operations and cash flows could be materially and adversely affected.

Our inability to access capital or significant increases in our cost of capital could adversely affect our business.

Our ability to obtain adequate and cost-effective financing depends on our credit quality as well as the liquidity of financial markets. A negative change in our ratings outlook or any downgrade in our credit ratings by the rating agencies could adversely affect our cost and/or access to sources of liquidity and capital. Additionally, such a downgrade could increase the costs of borrowing under available credit lines. Disruptions in the capital and credit markets could adversely affect our ability to access short-term and long-term capital. Our access to funds under current credit facilities is dependent on the ability of the participating banks to meet their funding commitments. Those banks may not be able to meet their funding commitments if they experience shortages of capital and liquidity. Longer disruptions in the capital and credit markets as a result of uncertainty, changing or increased regulation, reduced alternatives, or failures of significant financial institutions could adversely affect our access to capital needed for our business.

We are subject to covenants for our credit facilities and our unsecured notes.

Our senior secured credit facility, senior unsecured notes, letter of credit facilities and bank guarantee facilities contain various financial and other covenants. The financial covenants include a limit on the ratio of net debt to earnings before interest, taxes, depreciation and amortization and a limit on the ratio of earnings before interest, taxes, depreciation and amortization to interest expense. Other covenants, among other things, limit our ability to provide liens, restrict fundamental changes, limit transactions with affiliates and unrestricted subsidiaries, restrict changes to our fiscal year and to organization documents, limit asset dispositions, limit the use of proceeds from asset sales, limit sale and leaseback transactions, limit investments, limit the ability to incur debt, restrict certain payments to shareholders, limit negative pledges and limit the ability to change the nature of our business. Although we believe none of these covenants are presently restrictive to operations, the ability to meet financial and other covenants can be affected by changes in our results of operations or financial condition. We cannot provide assurance that we will meet these covenants. A breach of these covenants could result in a default under existing credit facilities. Upon the occurrence of an event of default under any of our credit facilities, the lenders could cause amounts outstanding to be immediately payable and terminate all commitments to extend further credit. The occurrence of these events would have a significant effect on our liquidity and cash flows.

Our effective income tax rate could change.

We operate subsidiaries in 41 countries, all of which have different income tax laws and associated income tax rates. Our effective income tax rate can be significantly affected by changes in the mix of pretax earnings by country and the related income tax rates in those countries. In addition, our effective income tax rate is significantly affected by the ability to realize deferred tax assets, including those associated with net operating losses. Changes in income tax laws, income apportionment, or estimates of the ability to realize deferred tax assets, could significantly affect our effective income tax rate, financial position and results of operations. We are subject to the regular examination of our income tax returns by various tax authorities. We regularly assess the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of our provision for income taxes. There can be no assurance that the outcomes from these examinations will not have a material adverse effect on our business.

We have certain environmental and other exposures related to our former coal operations.

We may incur future environmental and other liabilities in connection with our former coal operations, which could materially and adversely affect our financial condition, results of operations and cash flows.

We may be exposed to certain regulatory and financial risks related to climate change.

Growing concerns about climate change may result in the imposition of additional environmental regulations to which we are subject. Some form of federal regulation may be forthcoming with respect to greenhouse gas emissions (including carbon dioxide) and/or "cap and trade" legislation. The outcome of this legislation may result in new regulation, additional charges to fund energy efficiency activities or other regulatory actions. Compliance with these actions could result in the creation of additional costs to us, including, among other things, increased fuel prices or additional taxes or emission allowances. We may not be able to recover the cost of compliance with new or more stringent environmental laws and regulations from our customers, which could adversely affect our business. Furthermore, the potential effects of climate change and related regulation on our customers are highly uncertain and may adversely affect our operations.

The Company could be negatively affected as a result of the actions of activist or hostile stockholders.

Shareholder activism, which could take many forms and arise in a variety of situations, has been increasing among publicly traded companies. Shareholder activism, including potential proxy contests, requires significant time and attention by management and the Board of Directors, potentially hindering the Company’s ability to execute its strategic plan and negatively affecting the trading value of our common stock. Additionally, shareholder activism could give rise to perceived uncertainties as to the Company’s future direction, adversely affect its relationships with key executives, customers and other business partners, or make it more difficult to attract and retain qualified personnel. Also, the Company has been, and may in the future be, required to incur significant legal fees and other expenses related to activist shareholder matters. Any of these impacts could materially and adversely affect the Company and operating results.

Forward-Looking Statements

This document contains both historical and forward-looking information. Words such as “anticipates,” “assumes,” “estimates,” “expects,” “projects,” “predicts,” “intends,” “plans,” “potential,” “believes,” “may,” “should” and similar expressions may identify forward-looking information. Forward-looking information in this document includes, but is not limited to, statements regarding future performance of The Brink’s Company and its global operations, including: anticipated savings from reorganization and restructuring activities; the repatriation of cash from operations outside the U.S.; realization of deferred tax assets; the anticipated financial effect of pending litigation; the ability to meet liquidity needs; expenses and payouts for the U.S. retirement plans and the non-U.S. pension and benefit plans and the expected long-term rate of return and funded status of the primary U.S. pension plan; expected liability for and future contributions to the UMWA plans; liability for black lung obligations; the projected impact of future excise tax on the UMWA plans; expected future payments under contractual obligations; and the impact of recent accounting pronouncements. Forward-looking information in this document is subject to known and unknown risks, uncertainties, and contingencies, which are difficult to 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:


•	our ability to improve profitability and execute further cost and operational improvement and efficiencies in our core businesses;


•	our ability to improve service levels and quality in our core businesses;


•	market volatility and commodity price fluctuations;


•	seasonality, pricing and other competitive industry factors;


•	investment in information technology and its impact on revenue and profit growth;


•	our ability to maintain an effective IT infrastructure and safeguard confidential information;


•	our ability to effectively develop and implement solutions for our customers;

•

risks associated with operating in foreign countries, including changing political, labor and economic conditions, regulatory issues, currency restrictions and devaluations, restrictions on and cost of repatriating earnings and capital, impact on the Company’s financial results as a result of jurisdictions determined to be highly inflationary, and restrictive government actions, including nationalization;


•	labor issues, including negotiations with organized labor and work stoppages;


•	the strength of the U.S. dollar relative to foreign currencies and foreign currency exchange rates;


•	our ability to identify, evaluate and complete acquisitions and other strategic transactions, and to successfully integrate acquired companies;


•	costs related to dispositions and market exits;


•	our ability to obtain appropriate insurance coverage, positions taken by insurers relative to claims and the financial condition of insurers;


•	safety and security performance and loss experience;


•	employee, environmental and other liabilities in connection with former coal operations, including black lung claims;


•	the impact of the Patient Protection and Affordable Care Act on legacy liabilities and ongoing operations;


•	funding requirements, accounting treatment, and investment performance of our pension plans, the VEBA and other employee benefits;


•	changes to estimated liabilities and assets in actuarial assumptions;


•	the nature of hedging relationships and counterparty risk;


•	access to the capital and credit markets;


•	our ability to realize deferred tax assets;


•	the outcome of pending and future claims, litigation, and administrative proceedings;


•	public perception of our business, reputation and brand;


•	changes in estimates and assumptions underlying critical accounting policies;


•	the promulgation and adoption of new accounting standards, new government regulations and interpretation of existing standards and regulations.

The 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.

ITEM 1B. UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 2. PROPERTIES

We have property and equipment in locations throughout the world. Branch facilities generally have office space to support operations, a vault to securely process and store valuables and a garage to house armored vehicles and serve as a vehicle terminal. Many branches have additional space to repair and maintain vehicles.

We own or lease armored vehicles, panel trucks and other vehicles that are primarily service vehicles. Our armored vehicles are of bullet-resistant construction and are specially designed and equipped to provide security for the crew and cargo.

The following table discloses leased and owned facilities and vehicles for Brink’s most significant operations as of December 31, 2018.



	Facilities			Vehicles
	Leased	Owned	Total	Leased	Owned	Total

North America	337	97	434	2,917	3,954	6,871
South America	278	34	312	521	2,333	2,854
Rest of World	402	38	440	1,633	2,121	3,754
Corporate Items	5	—	5	—	—	—
Total	1,022	169	1,191	5,071	8,408	13,479

ITEM 3. LEGAL PROCEEDINGS

For a discussion of legal proceedings, see Note 23 to the consolidated financial statements, “Other Commitments and Contingencies,” in Part II, Item 8 of this 10-K.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

Executive Officers of the Registrant

The following is a list as of February 26, 2019, of the names and ages of the executive officers of The Company indicating the principal positions and offices held by each. There are no family relationships among any of the officers named.



Name	Age	Positions and Offices Held	Held Since
Douglas A. Pertz	64	Director, President and Chief Executive Officer	2016
Ronald J. Domanico	60	Executive Vice President, Chief Financial Officer	2016
Michael F. Beech	57	Executive Vice President	2014
Rohan Pal	53	Senior Vice President, Chief Information Officer and Chief Digital Officer	2016
Amit Zukerman	47	Executive Vice President	2014
Simon J. Davis	54	Senior Vice President and Chief Human Resources Officer	2019

Executive and other officers of the Company are elected annually and serve at the pleasure of the Board.

Mr. Pertz was appointed President and Chief Executive Officer of the Company in June 2016. Before joining the Company, Mr. Pertz served as president and CEO of Recall Holdings Limited, a global provider of digital and physical information management and security services, from 2013 until 2016. Prior to joining Recall, Mr. Pertz served as a partner with Bolder Capital, LLC (a private equity firm) from 2011 to 2013.

Mr. Domanico was appointed Executive Vice President and Chief Financial Officer of the Company in July 2016. Mr. Domanico also served as Treasurer from January through April 2017. Before joining Brink’s, Mr. Domanico served as senior vice president, strategic initiatives and capital markets at Recall Holdings Limited, a global provider of digital and physical information management and security services. From 2010 to 2014, he was senior vice president and CFO for HD Supply, one of the largest industrial distributors in North America. From 2002 to 2009 Mr. Domanico served as Senior Vice President, Chief Financial Officer and a member of the Board of Directors of Caraustar Industries. Caraustar and certain of its direct and indirect subsidiaries filed voluntary petitions on May 31, 2009 in the United States Bankruptcy Court for the Northern District of Georgia seeking relief under the provisions of chapter 11 of title 11 of the United States Bankruptcy Code. Caraustar’s plan of reorganization was confirmed by the Bankruptcy Court in early August 2009, and the company successfully emerged on August 20, 2009.

Mr. Beech was appointed Executive Vice President of the Company in December 2014. He has oversight responsibility for the Company's Brazil and Mexico operations as well as global safety and security. From December 2014 to July 2016, Mr. Beech had oversight responsibility for the Company's operations in the countries that composed the Company's former Largest 5 Markets segments. He served as President, Europe, Middle East and Africa for the Company’s operating subsidiary, Brink’s, Incorporated, from 2011 to December 2014 and as President, Asia Pacific from 2011 to 2012.

Mr. Pal was appointed Senior Vice President, Chief Information Officer and Chief Digital Officer of the Company in July 2016. Before joining Brink’s, Mr. Pal served as senior vice president and chief information officer/chief digital officer at Recall Holdings Limited, a global provider of digital and physical information management and security services, from June 2013 to June 2016.

Mr. Zukerman was appointed as the Company’s Executive Vice President in December 2014. He has oversight responsibility for the Company's operations in the 38 countries that comprise the Company's South America and Rest of World segments and its Brink's Global Services business. He served as President, Brink’s Global Services and Asia Pacific for the Company’s operating subsidiary, Brink’s, Incorporated, from 2012 to December 2014.

Mr. Davis was appointed as the Company’s Senior Vice President and Chief Human Resources Officer in January 2019. From July 2018 to January 2019, he served as Senior Vice President of Human Resources for Brink’s U.S. business. Prior to joining Brink’s, Mr. Davis served as Chief Human Resources Officer for Johnson Controls International, a diversified technology company, from 2015 to October 2017. He was Assistant Chief Human Resources Officer at Johnson Controls International from 2014 to 2015 and VP Talent Strategy and Organizational Excellence at Johnson Controls International from 2011 to 2014.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our common stock trades on the New York Stock Exchange under the symbol “BCO.” As of February 21, 2019, there were 1,305 shareholders of record of common stock.

Share Repurchase Program

In May 2017, our board of directors authorized a $200 million share repurchase program, which will expire on December 31, 2019. We are not obligated to repurchase any specific dollar amount or number of shares. At December 31, 2018, approximately $106 million remains available under this program. The timing and volume of share repurchases may be executed at the discretion of management on an opportunistic basis, or pursuant to trading plans or other arrangements. Share repurchases under this program may be made in the open market, in privately negotiated transactions, or otherwise.

In December 2018, we entered into an accelerated share repurchase arrangement ("ASR") with a financial institution. In exchange for a $50 million up-front payment at the beginning of the purchase period, the financial institution delivered to us 700,000 shares of our common stock for an average repurchase price of $71.43 per share. The shares received were retired in the period they were delivered to us, and the up-front payment was accounted for as a reduction to shareholders' equity in the consolidated balance sheet. For purposes of calculating earnings per share, we reported the ASR as a repurchase of our common stock in December 2018 and as a forward contract indexed to our common stock. The ASR met all of the applicable criteria for equity classification, and, as a result, was not being accounted for as a derivative instrument.

The ASR purchase period subsequently ended in February 2019 and we received and retired an additional 37,387 shares under the ASR, resulting in an overall average repurchase price of $67.81 per share.

Additionally, during the year ended December 31, 2018, we used $43.5 million to repurchase 610,177 shares at an average repurchase price of $71.22 per share. The shares were retired upon repurchase.

The following table provides information about common stock repurchases by the Company during the quarter then ended December 31, 2018.



Period	(a) Total Number of Shares Purchased⁽¹⁾	(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Plans or Programs
October 1 through
October 31, 2018	186,514	$	66.56	186,514	$	162,536,745

November 1 through
November 30, 2018	86,834	69.03		86,834	156,542,999

December 1 through
December 31, 2018	700,000	71.43		700,000	106,542,999


(1)	On May 8, 2017, the Company’s board of directors authorized the Company to repurchase up to $200 million of common stock from time to time as market conditions warrant and as covenants under existing agreements permit. The program does not require the Company to acquire any specific numbers of shares and may be modified or discontinued at any time. The program will expire on December 31, 2019.

The following graph compares the cumulative 5-year total return provided to shareholders of The Brink’s Company’s common stock compared to the cumulative total returns of the S&P SmallCap 600 Index and the S&P 600 Commercial & Professional Services Index, as well as the S&P Midcap 400 index and the common stocks of a selected peer group of companies. Given our unique service offerings, we do not believe that any single published industry index is appropriate for comparing shareholder return. Therefore, the peer group used in the performance graph combines publicly traded companies in the logistics services industry that have similar operational characteristics, such as route-based delivery of services. The companies included in the peer group are Cintas Corporation, Iron Mountain, Inc., ServiceMaster Global Holdings, Inc., Stericycle, Inc., UniFirst Corporation and Waste Management, Inc.

The graph tracks the performance of a $100 investment in our common stock and in each index from December 31, 2013, through December 31, 2018. The performance of The Brink’s Company’s common stock assumes that the shareholder reinvested all dividends received during the period.

*$100 invested on 12/31/13 in stock or index, including reinvestment of dividends

Fiscal Year ending December 31.

Source: Zacks Investment Research, Inc.

Comparison of Five-Year Cumulative Total Return^(a)



	Years Ended December 31,
	2013		2014	2015	2016	2017	2018

The Brink's Company	$	100.00	72.59	87.03	125.95	242.41	200.76
S&P SmallCap 600 Index	100.00		105.76	103.67	131.20	148.56	135.96
S&P 600 Commercial & Professional Services Index	100.00		99.07	100.35	124.39	139.14	135.51
S&P MidCap 400 Index	100.00		109.77	107.38	129.65	150.71	134.01
Peer Group	100.00		123.33	126.81	148.88	183.74	183.86

(a)

For the line designated as “The Brink’s Company” the graph depicts the cumulative return on $100 invested in The Brink’s Company’s common stock at December 31, 2013. The cumulative return for each index is measured on an annual basis for the periods from December 31, 2013, through December 31, 2018, with the value of each index set to $100 on December 31, 2013. Total return assumes reinvestment of dividends. In 2015, we chose the S&P SmallCap 600 Index and the S&P 600 Commercial & Professional Services Index because we believed that these indices broadly measured the performance of small-cap companies in the United States market and for a smaller subset of small-cap companies in the commercial services industry, respectively. In 2018, we changed the indices we provide as appropriate comparisons to the S&P Midcap 400 Index and our custom peer group as we are now included in the S&P Midcap 400 Index and we believe the custom peer group has more similar characteristics to our company for the factors noted above.

ITEM 6. SELECTED FINANCIAL DATA

Five Years in Review



GAAP Basis
(In millions, except for per share amounts)	2018^(a)			2017^(a)		2016		2015		2014

Revenues	$	3,488.9		3,347.0		3,020.6		3,061.4		3,562.3
Operating profit	274.7			273.9		184.5		96.4		59.4

Income (loss) attributable to Brink’s
Continuing operations	$	(33.3	)	16.9		36.2		(9.1	)	(54.8	)
Discontinued operations	—			(0.2	)	(1.7	)	(2.8	)	(29.1	)
Net income (loss) attributable to Brink’s	$	(33.3	)	16.7		34.5		(11.9	)	(83.9	)

Financial Position
Property and equipment, net	$	699.4		640.9		531.0		549.0		669.5
Total assets	3,236.0			3,059.6		1,994.8		1,946.7		2,192.0
Long-term debt, less current maturities	1,471.6			1,139.6		247.6		358.1		373.1
Brink’s shareholders’ equity	153.7			317.4		337.1		317.9		434.0

Supplemental Information
Depreciation and amortization	$	162.3		146.6		131.6		139.9		161.9
Capital expenditures	155.1			174.5		112.2		101.1		136.1

Earnings (loss) per share attributable to Brink’s common shareholders
Basic:
Continuing operations	$	(0.65	)	0.33		0.72		(0.19	)	(1.12	)
Discontinued operations	—			(0.01	)	(0.03	)	(0.06	)	(0.59	)
Net income (loss)	(0.65		)	0.33		0.69		(0.24	)	(1.71	)

Diluted:
Continuing operations	$	(0.65	)	0.33		0.72		(0.19	)	(1.12	)
Discontinued operations	—			(0.01	)	(0.03	)	(0.06	)	(0.59	)
Net income (loss)	(0.65		)	0.32		0.68		(0.24	)	(1.71	)
Cash dividends	$	0.60		0.55		0.40		0.40		0.40

Weighted-average Shares
Basic	50.9			50.7		50.0		49.3		49.0
Diluted	50.9			51.8		50.6		49.3		49.0



Non-GAAP Basis*
(In millions, except for per share amounts)	2018		2017	2016	2015	2014

Non-GAAP revenues	$	3,437.5	3,192.9	2,908.4	2,976.9	3,350.5
Non-GAAP operating profit	346.9		281.4	215.8	167.5	134.5

Amounts attributable to Brink’s
Non-GAAP income from continuing operations	$	179.4	157.2	115.6	87.1	53.3
Non-GAAP diluted EPS – continuing operations	$	3.46	3.03	2.28	1.75	1.09

(a)

In 2018, we acquired two business operations for an aggregate purchase price of approximately $548 million. In 2017, we acquired six business operations in five countries for an aggregate purchase price of approximately $361 million. We also entered into a new $1.5 billion senior secured credit facility and issued $600 million in senior unsecured notes in 2017. See Note 7 and Note 15 to the consolidated financial statements for more detailed information on the business acquisitions and debt.

*Reconciliations to GAAP results begin on page 34.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

THE BRINK’S COMPANY

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

AS OF DECEMBER 31, 2018 AND 2017

AND FOR EACH OF THE YEARS IN THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2018

TABLE OF CONTENTS



		Page
OPERATIONS		20

RESULTS OF OPERATIONS
	Analysis of Results: 2018 versus 2017	21
	Analysis of Results: 2017 versus 2016	24
	Income and Expense Not Allocated to Segments	27
	Other Operating Income and Expense	30
	Nonoperating Income and Expense	31
	Income Taxes	32
	Noncontrolling Interests	33
	Non-GAAP Results Reconciled to GAAP	34
	Foreign Operations	37

LIQUIDITY AND CAPITAL RESOURCES
	Overview	38
	Operating Activities	38
	Investing Activities	39
	Financing Activities	41
	Effect of Exchange Rate Changes on Cash and Cash Equivalents	41
	Capitalization	42
	Off Balance Sheet Arrangements	44
	Contractual Obligations	45
	Contingent Matters	47

APPLICATION OF CRITICAL ACCOUNTING POLICIES
	Deferred Tax Asset Valuation Allowance	48
	Business Acquisitions	49
	Goodwill, Other Intangible Assets and Property and Equipment Valuations	50
	Retirement and Postemployment Benefit Obligations	51
	Foreign Currency Translation	55

OPERATIONS

The Brink’s Company offers secure transportation and route-based logistics management services for cash and valuables throughout the world. These services include:


•	Cash-in-transit services – armored vehicle transportation of valuables


•	ATM services – replenishing and maintaining customers’ automated teller machines; providing network infrastructure services


•	Global services – secure international transportation of valuables


•	Cash management services


◦	Currency and coin counting and sorting; deposit preparation and reconciliations; other cash management services


◦	Safe and safe control device installation and servicing (including our patented CompuSafe^® service)


◦	Vaulting services


◦	Check imaging services


•	Payment services – bill payment and processing services on behalf of utility companies and other billers at any of our Brink’s or Brink’s – operated payment locations in Brazil, Colombia, Panama and Mexico and Brink’s Money™ general purpose reloadable prepaid cards and payroll cards in the U.S.


•	Commercial security systems services – design and installation of security systems in designated markets in Europe


•	Guarding services – protection of airports, offices, and certain other locations in Europe and Brazil with or without electronic surveillance, access control, fire prevention and highly trained patrolling personnel

We have the following three reportable segments:


•	North America


•	South America


•	Rest of World.

We believe that Brink’s has significant competitive advantages including:


•	track record of refining our business portfolio to deliver shareholder value


•	medium-term growth drivers from high-value services


•	global footprint in a world with increasing security needs


•	brand name recognition


•	reputation for a high level of service and security


•	risk management and logistics expertise


•	value-based solutions expertise


•	operational excellence


•	high-quality insurance coverage and financial strength

We focus our time and resources on service quality, protecting and strengthening our brand, and addressing our risks. Our marketing and sales efforts are enhanced by the “Brink’s” brand, so we seek to protect and build its value. Because our services focus on handling, transporting, protecting and managing valuables, we strive to understand and manage risk.

In order to earn an adequate return on capital, we focus on the effective and efficient use of resources in addition to our pricing discipline. We attempt to maximize the amount of business that flows through our branches, vehicles and systems in order to obtain the lowest costs possible without compromising safety, security or service.

Operating results may vary from period to period. Because revenues are generated from charges per service performed or based on the value of goods transported, they can be affected by both the level of economic activity and the volume of business for specific customers. We also periodically incur costs to change the scale of our operations when volumes increase or decrease. Incremental costs incurred usually relate to increasing or decreasing the number of employees and increasing or decreasing branches or administrative facilities. In addition, security costs can vary depending on performance, the cost of insurance coverage, and changes in crime rates (i.e., attacks and robberies).

Brink’s revenues and related operating profit are generally higher in the second half of the year, particularly in the fourth quarter, due to generally increased economic activity associated with the holiday season.

RESULTS OF OPERATIONS

Analysis of Results: 2018 versus 2017

Consolidated Results

GAAP and Non-GAAP Financial Measures We provide an analysis of our operations below on both a generally accepted accounting principles (“GAAP”) and non-GAAP basis. The purpose of the non-GAAP information is to report our operating profit, income from continuing operations and earnings per share without certain income and expense items that do not reflect the regular earnings of our operations. The 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 such measures allow investors to evaluate our performance using the same metrics that our management uses to evaluate past performance and prospects for future performance. We do not consider these items to be reflective of our core operating performance due to the variability of such items from period-to-period in terms of size, nature and significance. The non-GAAP adjustments used to reconcile our GAAP results are described in detail on pages 27-29 and are reconciled to comparable GAAP measures on pages 34-36.

Definition of Organic Growth Organic growth represents the change in revenues or operating profit between the current and prior period excluding the effect of acquisitions and dispositions and changes in currency exchange rates. See definitions on page 23.



Years Ended December 31,	2018			2017	% Change
(In millions, except for per share amounts)

GAAP
Revenues	$	3,488.9		3,347.0	4
Cost of revenues	2,703.3			2,608.2	4
Selling, general and administrative expenses	509.2			468.2	9
Operating profit	274.7			273.9	—
Income (loss) from continuing operations^(a)	(33.3		)	16.9	unfav
Diluted EPS from continuing operations^(a)	$	(0.65	)	0.33	unfav

Non-GAAP^(b)
Non-GAAP revenues	$	3,437.5		3,192.9	8
Non-GAAP operating profit	346.9			281.4	23
Non-GAAP income from continuing operations^(a)	179.4			157.2	14
Non-GAAP diluted EPS from continuing operations^(a)	$	3.46		3.03	14


(a)	Amounts reported in this table are attributable to the shareholders of Brink’s and exclude earnings related to noncontrolling interests.


(b)	Non-GAAP results are reconciled to the applicable GAAP results on pages 34–36.

Deconsolidation of Venezuela

Due to political and economic conditions in Venezuela, in the second quarter of 2018 we determined that we no longer met the accounting criteria for control over our Venezuelan operations. We expect these conditions to continue for the foreseeable future. Consequently, we began reporting the results of our investment in our Venezuelan subsidiaries using the cost method of accounting. We determined the fair value of our cost method investment in, and receivables from, our Venezuelan subsidiaries to be insignificant based on our expectations of dividend payments and settlements of such receivables in future periods. As a result, we deconsolidated our Venezuela subsidiaries and recognized a pretax loss of $126.7 million in the second quarter of 2018. This loss is excluded from our non-GAAP results.

GAAP Basis

Analysis of Consolidated Results: 2018 versus 2017

Consolidated Revenues Revenues increased $141.9 million as organic growth in Venezuela ($1,936.0 million), South America ($145.0 million), North America ($67.1 million), and Rest of World ($11.3 million), and the favorable impact of acquisitions and dispositions ($213.4 million) was partially offset by unfavorable changes in currency exchange rates ($2,230.9 million). A significant portion of the reduction in revenues from currency exchange rates relates to the strengthening of the U.S. dollar against the Venezuela bolivar ($2,038.7 million). Revenues increased on an organic basis due mainly to higher average selling prices in Venezuela and Argentina (including the effects of inflation), organic revenue growth from volume growth and price increases in Mexico and Brazil, and price increases in the U.S. See above for our definition of “organic growth.”

Consolidated Costs and Expenses Cost of revenues increased 4% to $2,703.3 million primarily due to the impact of acquisitions and inflation-based organic increases in labor and other operational costs, partially offset by changes in currency exchange rates. Selling, general and administrative costs increased 9% to $509.2 million due primarily to organic increases in compensation costs and the impact of acquisitions, partially offset by changes in currency exchange rates.

Consolidated Operating Profit Operating profit increased $0.8 million due mainly to:


•	organic increases in Venezuela ($569.3 million), South America ($68.1 million) and North America ($48.2 million), and


•	the favorable operating impact of business acquisitions and dispositions ($28.1 million), excluding intangible asset amortization and acquisition-related charges,

partially offset by:


•	unfavorable changes in currency exchange rates ($664.6 million), including the effects of Venezuela devaluations,


•	higher costs related to business acquisitions and dispositions ($36.1 million), primarily from the impact of acquisition-related charges and intangible asset amortization in 2018,


•	the organic decrease in Rest of World ($4.6 million), and


•	higher corporate expenses ($4.4 million on an organic basis).

Consolidated Income from Continuing Operations Attributable to Brink’s and Related Per Share Amounts Income from continuing operations attributable to Brink’s shareholders in 2018 decreased $50.2 million to negative $33.3 million primarily due to the loss on deconsolidation of Venezuela operations ($126.7 million) and higher interest expense ($34.5 million), partially offset by lower income tax expense ($87.7 million), lower interest and other nonoperating income (expense) ($21.4 million), lower income attributable to noncontrolling interests ($1.1 million) and the operating profit increase mentioned above. The lower income tax expense was primarily driven by the U.S. tax reform charge recognized in the fourth quarter of 2017. Earnings per share from continuing operations was negative $0.65, down from $0.33 in 2017.

Non-GAAP Basis

Analysis of Consolidated Results: 2018 versus 2017

Non-GAAP Consolidated Revenues Non-GAAP revenues increased $244.6 million as organic growth in South America ($145.0 million), North America ($67.1 million), and Rest of World ($11.3 million), and the favorable impact of acquisitions and dispositions ($213.4 million) was partially offset by unfavorable changes in currency exchange rates ($192.2 million). The unfavorable currency impact was driven by the Argentine peso and Brazilian real and was partially offset by the favorable impact of the euro. Non-GAAP revenues increased 7% on an organic basis due mainly to higher average selling prices in Argentina (including the effects of inflation), organic revenue growth from volume growth and price increases in Mexico and Brazil, and price increases in the U.S.

Non-GAAP Consolidated Operating Profit Non-GAAP operating profit increased $65.5 million due mainly to:


•	organic increases in South America ($68.1 million) and North America ($48.2 million), and


•	the favorable operating impact of business acquisitions and dispositions ($28.1 million),

partially offset by:


•	unfavorable changes in currency exchange rates ($69.9 million),


•	the organic decrease in Rest of World ($4.6 million), and


•	higher corporate expenses ($4.4 million on an organic basis).

Non-GAAP Consolidated Income from Continuing Operations Attributable to Brink’s and Related Per Share Amounts Non-GAAP income from continuing operations attributable to Brink’s shareholders in 2018 increased $22.2 million to $179.4 million primarily due to the non-GAAP operating profit increase mentioned above and higher interest and other nonoperating income (expense) ($4.0 million), partially offset by higher interest expense ($34.6 million) and higher income tax expense ($12.0 million). Earnings per share from continuing operations was $3.46, up from $3.03 in 2017.

Revenues and Operating Profit by Segment: 2018 versus 2017



				Organic		Acquisitions /						% Change
(In millions)	2017			Change		Dispositions^(a)		Currency^(b)		2018		Total		Organic
Revenues:
North America	$	1,254.2		67.1		152.9		(7.9	)	1,466.3		17		5
South America	924.6			145.0		70.1		(212.8	)	926.9		—		16
Rest of World	1,014.1			11.3		(9.6	)	28.5		1,044.3		3		1
Segment revenues^(e)	3,192.9			223.4		213.4		(192.2	)	3,437.5		8		7

Other items not allocated to segments^(d)	154.1			1,936.0		—		(2,038.7	)	51.4		(67	)	fav
Revenues - GAAP	$	3,347.0		2,159.4		213.4		(2,230.9	)	3,488.9		4		65

Operating profit:
North America	$	74.0		48.2		9.3		(1.7	)	129.8		75		65
South America	182.8			68.1		15.8		(68.0	)	198.7		9		37
Rest of World	115.2			(4.6	)	3.0		0.8		114.4		(1	)	(4	)
Segment operating profit	372.0			111.7		28.1		(68.9	)	442.9		19		30
Corporate^(c)	(90.6		)	(4.4	)	—		(1.0	)	(96.0	)	6		5
Operating profit - non-GAAP	281.4			107.3		28.1		(69.9	)	346.9		23		38

Other items not allocated to segments^(d)	(7.5		)	554.7		(24.7	)	(594.7	)	(72.2	)	unfav		fav
Operating profit (loss) - GAAP	$	273.9		662.0		3.4		(664.6	)	274.7		—		fav

Amounts may not add due to rounding.


(a)	Non-GAAP amounts include the impact of prior year comparable period results for acquired and disposed businesses. GAAP results also include the impact of acquisition-related intangible amortization, restructuring and other charges, and disposition related gains/losses.


(b)	The amounts in the “Currency” column consist of the effects of Venezuela devaluations and the sum of monthly currency changes. Monthly currency changes represent the accumulation throughout the year of the impact on current period results of changes in foreign currency rates from the prior year period.


(c)	Corporate expenses are not allocated to segment results. Corporate expenses include salaries and other costs to manage the global business and to perform activities required by public companies.


(d)	See pages 27–29 for more information.


(e)	Segment revenues equal our total reported non-GAAP revenues.

Analysis of Segment Results: 2018 versus 2017

North America

Revenues increased 17% ($212.1 million) primarily due to the favorable impact of acquisitions ($152.9 million), primarily related to the Dunbar acquisition, and 5% organic growth ($67.1 million), slightly offset by the unfavorable impact of currency exchange rates ($7.9 million) from the Mexican peso. Organic revenue growth increased from price and volume growth in Mexico and price increases in the U.S. Operating profit increased $55.8 million primarily due to organic growth in the U.S. and Mexico and the favorable impact of acquisitions ($9.3 million), primarily related to the Dunbar acquisition. Organic profit growth in the U.S. was driven by price increases and lower labor costs and other productivity improvements. Organic profit growth in Mexico was driven by higher volumes, price increases and labor-related productivity improvements.

South America

Revenues increased $2.3 million due to 16% organic growth ($145.0 million) and the favorable impact of acquisitions ($70.1 million), mostly offset by the unfavorable impact of currency exchange rates ($212.8 million) primarily from the Argentine peso and Brazilian real. The organic growth was driven by inflation-based price increases in Argentina and price and volume growth in Brazil, Chile, and Colombia. Operating profit increased 9% ($15.9 million) driven by organic revenue growth in Argentina, Brazil, Chile, and Colombia and the favorable impact of acquisitions ($15.8 million), partially offset by unfavorable currency exchange rates ($68.0 million) primarily driven by the Argentine peso.

Rest of World

Revenues increased 3% ($30.2 million) due to the favorable impact of currency exchange rates ($28.5 million) primarily from the euro, and 1% organic growth ($11.3 million), partially offset by the unfavorable impact of acquisitions and dispositions ($9.6 million). The organic revenue growth was driven by Israel and Greece, partially offset by a decrease in France due to pricing and volume pressure. Operating profit decreased 1% ($0.8 million) due to an organic decrease ($4.6 million), partially offset by the favorable impact of acquisitions and dispositions ($3.0 million) and currency exchange rates ($0.8 million). The organic decline was primarily related to France, partially offset by growth in the rest of Europe and Asia Pacific.

Analysis of Results: 2017 versus 2016

Consolidated Results



Years Ended December 31,	2017		2016	% Change
(In millions, except for per share amounts)

GAAP
Revenues	$	3,347.0	3,020.6	11
Cost of revenues	2,608.2		2,391.7	9
Selling, general and administrative expenses	468.2		424.3	10
Operating profit	273.9		184.5	48
Income (loss) from continuing operations^(a)	16.9		36.2	(53	)
Diluted EPS from continuing operations^(a)	$	0.33	0.72	(54	)

Non-GAAP^(b)
Non-GAAP revenues	$	3,192.9	2,908.4	10
Non-GAAP operating profit	281.4		215.8	30
Non-GAAP income from continuing operations^(a)	157.2		115.6	36
Non-GAAP diluted EPS from continuing operations^(a)	$	3.03	2.28	33


(a)	Amounts reported in this table are attributable to the shareholders of Brink’s and exclude earnings related to noncontrolling interests.


(b)	Non-GAAP results are reconciled to the applicable GAAP results on pages 34–36.

GAAP Basis

Analysis of Consolidated Results: 2017 versus 2016

Consolidated Revenues Revenues increased $326.4 million as organic growth in Venezuela ($445.5 million), South America ($134.7 million), North America ($33.2 million), and Rest of World ($18.1 million), and the favorable impact of acquisitions and dispositions ($67.6 million) was partially offset by unfavorable changes in currency exchange rates ($372.7 million). A significant portion of the reduction in revenues from currency exchange rates relates to the devaluation of the Venezuela bolivar ($400.8 million). Revenues increased 21% on an organic basis due mainly to higher average selling prices in Venezuela and Argentina (including the effects of inflation) and organic revenue growth in Brazil and Mexico driven by volume growth and price increases.

Consolidated Costs and Expenses Cost of revenues increased 9% to $2,608.2 million due the impact of acquisitions and inflation-based increases on labor and other operational costs, partially offset by productivity improvements. Selling, general and administrative costs increased 10% to $468.2 million due primarily to the impact of acquisitions and higher compensation costs driven by incentive-based compensation, partially offset by changes in currency exchange rates.

Consolidated Operating Profit Operating profit increased $89.4 million due mainly to:


•	organic increases in Venezuela ($115.8 million), South America ($52.6 million) and North America ($31.3 million),


•	the favorable impact of acquisitions and dispositions ($21.0 million), and


•	lower organic impact of costs from reorganization and restructuring actions and acquisition and disposition activities ($18.8 million) included in "Other items not allocated to segments",

partially offset by:


•	unfavorable changes in currency exchange rates ($122.2 million), including the effects of Venezuela devaluations, and


•	higher corporate expenses ($27.6 million on an organic basis) due to higher incentive-based compensation and security losses

Consolidated Income from Continuing Operations Attributable to Brink’s and Related Per Share Amounts Income from continuing operations attributable to Brink’s shareholders in 2017 decreased $19.3 million to $16.9 million primarily due to higher income tax expense ($79.2 million) driven by U.S. tax reform, higher interest expense ($11.8 million), and higher interest and other nonoperating income (expense) ($21.1 million). These items were partially offset by the operating profit increase mentioned above. Earnings per share from continuing operations was $0.33, down from $0.72 in 2016.

Non-GAAP Basis

Analysis of Consolidated Results: 2017 versus 2016

Non-GAAP Consolidated Revenues Non-GAAP revenues increased $284.5 million primarily due to organic growth in South America ($134.7 million), North America ($33.2 million), and Rest of World ($18.1 million), as well as the favorable impact of acquisitions and dispositions ($70.4 million) and currency exchange rates ($28.1 million). The favorable currency impact was driven by the Brazilian real and the euro, which was partially offset by the unfavorable impact of the Argentine peso. Non-GAAP revenues increased 6% on an organic basis due mainly to higher average selling prices in Argentina (including the effects of inflation) and organic revenue growth in Brazil and Mexico driven by volume growth and price increases.

Non-GAAP Consolidated Operating Profit Non-GAAP operating profit increased $65.6 million due mainly to:


•	organic increases in South America ($52.6 million) and North America ($31.3 million), and


•	the favorable impact of acquisitions and dispositions ($19.9 million),

partially offset by:


•	higher corporate expenses ($27.6 million on an organic basis) due to higher incentive-based compensation and security losses, and


•	unfavorable changes in currency exchange rates ($10.3 million).

Non-GAAP Consolidated Income from Continuing Operations Attributable to Brink’s and Related Per Share Amounts Non-GAAP income from continuing operations attributable to Brink’s shareholders in 2017 increased $41.6 million to $157.2 million primarily due to the non-GAAP operating profit increase mentioned above, partially offset by the corresponding higher non-GAAP income tax expense ($14.6 million) and higher interest expense ($10.7 million). Non-GAAP earnings per share from continuing operations was $3.03, up from $2.28 in 2016.

Revenues and Operating Profit by Segment: 2017 versus 2016



				Organic		Acquisitions /						% Change
(In millions)	2016			Change		Dispositions^(a)		Currency^(b)		2017		Total		Organic
Revenues:
North America	$	1,210.3		33.2		10.7		—		1,254.2		4		3
South America	718.7			134.7		63.7		7.5		924.6		29		19
Rest of World	979.4			18.1		(4.0	)	20.6		1,014.1		4		2
Segment revenues^(e)	2,908.4			186.0		70.4		28.1		3,192.9		10		6

Other items not allocated to segments^(d)	112.2			445.5		(2.8	)	(400.8	)	154.1		37		fav
Revenues - GAAP	$	3,020.6		631.5		67.6		(372.7	)	3,347.0		11		21

Operating profit:
North America	$	40.1		31.3		1.9		0.7		74.0		85		78
South America	122.6			52.6		16.0		(8.4	)	182.8		49		43
Rest of World	111.3			(0.3	)	2.0		2.2		115.2		4		—
Segment operating profit	274.0			83.6		19.9		(5.5	)	372.0		36		31
Corporate^(c)	(58.2		)	(27.6	)	—		(4.8	)	(90.6	)	56		47
Operating profit - non-GAAP	215.8			56.0		19.9		(10.3	)	281.4		30		26

Other items not allocated to segments^(d)	(31.3		)	134.6		1.1		(111.9	)	(7.5	)	(76	)	fav
Operating profit (loss) - GAAP	$	184.5		190.6		21.0		(122.2	)	273.9		48		fav

Amounts may not add due to rounding.

See page 23 for footnotes.

Analysis of Segment Results: 2017 versus 2016

North America

Revenues increased 4% ($43.9 million) driven by organic growth of 3% ($33.2 million) and the favorable impact of acquisitions ($10.7 million). Organic revenue growth was primarily driven by price and volume growth in Mexico. Operating profit increased $33.9 million primarily due to organic growth in the U.S. and Mexico. Organic profit growth in the U.S. was driven by lower vehicle costs, labor and other productivity improvements, and lower security losses. Organic profit growth in Mexico was driven by productivity improvements.

South America

Revenues increased 29% ($205.9 million) primarily due to 19% organic growth ($134.7 million), the favorable impact of acquisitions ($63.7 million) and currency exchange rates ($7.5 million) mostly from the Brazilian real, partially offset by a decline in the Argentine peso. The organic growth was driven by inflation-based price increases in Argentina and increased volume growth and price increases in Brazil. Operating profit increased 49% ($60.2 million) driven by organic growth in Argentina and Brazil and the favorable impact of acquisitions ($16.0 million), partially offset by unfavorable currency ($8.4 million) driven by the Argentine peso.

Rest of World

Revenues increased 4% ($34.7 million) due to the favorable impact of currency exchange rates ($20.6 million), primarily from the euro, and 2% organic growth ($18.1 million). The organic revenue growth was driven by Greece and Asia, partially offset by a decrease in France due to pricing pressure. Operating profit increased 4% ($3.9 million) due to the favorable impact of currency ($2.2 million) and acquisitions and dispositions ($2.0 million). Organic growth was down slightly ($0.3 million) due to a decrease in France related to pricing pressure which was partially offset by growth in Asia.

Income and Expense Not Allocated to Segments

Corporate Expenses

Corporate expenses include costs to manage the global business and to perform activities required of public companies, as well as currency transaction gains and losses.



	Years Ended December 31,							% change
(In millions)	2018			2017		2016		2018	2017

General, administrative and other expenses	$	(99.4	)	(84.3	)	(59.8	)	18	41
Foreign currency transaction gains (losses)	(2.2		)	(1.1	)	3.8		100	unfav
Reconciliation of segment policies to GAAP	5.6			(5.2	)	(2.2	)	fav	unfav
Corporate items	$	(96.0	)	(90.6	)	(58.2	)	6	56

Corporate expenses in 2018 were $5.4 million higher than the prior year primarily due to higher share-based compensation expense and information technology costs. These increased costs were partially offset by lower bad debt expense, resulting from the reconciliation of segment policies to GAAP, and higher royalty income from our brand licensing agreement related to our trademark "Brink's Home Security."

Corporate expenses in 2017 were $32.4 million higher than the prior year primarily due to higher incentive compensation expense and security losses recognized in corporate expenses.

Other Items Not Allocated to Segments



	Years Ended December 31,							% change
(In millions)	2018			2017		2016		2018		2017
Revenues:
Venezuela operations	$	51.4		154.1		109.4		(67	)	41
Acquisitions and dispositions	—			—		2.8		—		(100	)
Revenues	$	51.4		154.1		112.2		(67	)	37

Operating profit:
Venezuela operations	$	2.3		20.4		18.5		(89	)	10
Reorganization and Restructuring	(20.6		)	(22.6	)	(30.3	)	(9	)	(25	)
Acquisitions and dispositions	(41.4		)	(5.3	)	(19.5	)	unfav		(73	)
Argentina highly inflationary impact	(8.0		)	—		—		unfav		—
Reporting compliance	(4.5		)	—		—		unfav		—
Operating profit	$	(72.2	)	(7.5	)	(31.3	)	unfav		(76	)

2018 versus 2017

The impact of other items not allocated to segments on operating profit was a larger loss ($72.2 million in 2018 versus $7.5 million in the prior year). The change was primarily due to higher charges from acquisitions and dispositions in the current year as 2018 included increases in intangible asset amortization, acquisition-related restructuring charges and transaction costs. We also incurred costs in 2018 related to the integration of our Temis and Dunbar acquisitions into existing Brink's operations. These acquisition-related costs were partially offset by a gain on the sale of real estate in Mexico in 2018. Profits from Venezuela operations decreased significantly in 2018 versus 2017 as political and economic conditions in that country negatively affected our operations and ultimately led to the deconsolidation of our Venezuelan subsidiaries effective June 30, 2018 (see Note 1 of the consolidated financial statements). In the current year, we also incurred charges related to the impact of highly inflationary accounting in Argentina as well as certain reporting compliance costs that we did not incur in the prior year.

2017 versus 2016

The impact of other items not allocated to segments on operating profit was a smaller loss ($7.5 million in 2017 versus $31.3 million in the prior year). The change was primarily due to lower charges from acquisitions and dispositions in 2017 as the prior year included losses from Ireland operations exited in 2016 as well as a loss on the sale of corporate assets. In addition, 2017 includes a gain on the sale of real estate in Mexico. These favorable items were partially offset by higher amortization expense for acquisition-related intangible assets, severance costs related to recent business acquisitions in Argentina and Brazil and transaction costs related to 2017 business acquisitions. Charges from reorganization and restructuring activities were lower in 2017 and profit from Venezuela operations was higher in 2017.

Venezuela operations Prior to the deconsolidation of our Venezuelan subsidiaries effective June 30, 2018, we excluded from our segment results all of our Venezuela operating results due to the Venezuelan government's restrictions that prevented us from repatriating funds. In light of these unique circumstances, our operations in Venezuela have been largely independent of the rest of our global operations. As a result, the Chief Executive Officer, the Company's Chief Operating Decision maker ("CODM"), assessed segment performance and made resource decisions by segment excluding Venezuela operating results. Additionally, management believed excluding Venezuela from segment results made it possible to more effectively evaluate the company’s performance between periods. Prior to the deconsolidation, Venezuela operating results included remeasurement gains and losses on monetary assets and liabilities related to currency devaluations. We recognized remeasurement gains of $2.2 million in 2018 versus remeasurement losses of $9.1 million in 2017 and $4.8 million in 2016.

Factors considered by management in excluding Venezuela results included:


•	Continued inability to repatriate cash to redeploy to other operations or dividend to shareholders


•	Highly inflationary environment


•	Fixed exchange rate policy


•	Continued currency devaluations and


•	Difficulty raising prices and controlling costs

Reorganization and Restructuring

2016 Restructuring

In the fourth quarter of 2016, management implemented restructuring actions across our global business operations and our corporate functions. As a result of these actions, we recognized $18.1 million in related 2016 costs and an additional $17.3 million in 2017 under this restructuring for costs related to severance, asset-related adjustments, a benefit program termination and lease terminations. We recognized an additional $13.0 million in 2018 under this restructuring for severance costs and asset-related adjustments. The actions under this program were substantially completed in 2018, with cumulative pretax charges of approximately $48 million. Severance actions reduced our global workforce by approximately 800 positions.

Executive Leadership and Board of Directors

In January 2016, we announced Executive Leadership and Board of Directors restructuring actions, and we recognized $4.3 million in charges in 2016 related to these actions.

2015 Restructuring

Brink's initiated a global restructuring of its business in the third quarter of 2015. We recognized $6.5 million in 2016 related to this restructuring for severance costs, contract terminations and lease terminations. The 2015 Reorganization and Restructuring reduced the global workforce by approximately 1,100 positions and resulted in approximately $20 million in 2016 savings. The actions under this program were substantially completed by the end of 2016, with cumulative pretax charges of approximately $18 million.

Other Restructurings

Management periodically implements restructuring actions in targeted sections of our business. As a result of these actions, we recognized costs of $4.6 million in 2017 and $7.6 million in 2018, primarily severance costs. When completed, the current restructuring actions will reduce our workforce by 300 to 400 positions and result in approximately $9 million in annualized cost savings. For the current restructuring actions, we expect to incur additional costs between $5 million and $7 million in future periods. These estimates will be updated as management targets additional sections of our business.

Due to the unique circumstances around these charges, they have not been allocated to segment results and are excluded from non-GAAP results. Charges related to the employees, assets, leases and contracts impacted by these restructuring actions were excluded from the segments and corporate expenses as shown in the table below.



	Years Ended December 31,							% change
(In millions)	2018			2017		2016		2018		2017
Reportable Segments:
North America	$	(0.7	)	(5.3	)	(6.0	)	(87	)	(12	)
South America	(3.9		)	(4.6	)	(4.6	)	(15	)	—
Rest of World	(14.9		)	(10.1	)	(13.2	)	48		(23	)
Total reportable segments	(19.5		)	(20.0	)	(23.8	)	(3	)	(16	)
Corporate items	(1.1		)	(2.6	)	(6.5	)	(58	)	(60	)
Total	$	(20.6	)	(22.6	)	(30.3	)	(9	)	(25	)

Acquisitions and dispositions Part of our strategy is the pursuit of accretive business acquisitions. In 2018, we completed one business acquisition in the U.S. and acquired a controlling interest in a business in Cambodia. We additionally completed the acquisition of the noncontrolling interest in our Colombian subsidiary. In 2017, we completed six business acquisitions in the U.S., Brazil, Chile, Argentina and France. In January 2019, we completed the acquisition of another business in Brazil. Certain acquisition and disposition items that are not considered part of the ongoing activities of the business and are special in nature are consistently excluded from non-GAAP results. These items are described below:

2018 Acquisitions and Dispositions


•	Amortization expense for acquisition-related intangible assets was $17.7 million in 2018.


•	Integration costs in 2018 related to acquisitions in France and the U.S. were $8.1 million.


•	2018 transaction costs related to business acquisitions were $6.7 million.


•	We incurred 2018 severance charges related to our acquisitions in Argentina, France, U.S. and Brazil of $5.0 million.


•	Compensation expense related to the retention of key Dunbar employees was $4.1 million in 2018.


•	We recognized a net gain in 2018 ($2.6 million, net of statutory employee benefit) on the sale of real estate in Mexico.

2017 Acquisitions and Dispositions


•	Amortization expense for acquisition-related intangible assets was $8.4 million in 2017.


•	We recognized a net gain in 2017 related to the sale of real estate in Mexico ($7.8 million, net of statutory employee benefit).


•	2017 severance costs were $4.0 million related to our recent acquisitions in Argentina and Brazil.


•	Transaction costs were $2.6 million related to acquisitions of new businesses in 2017.


•	Currency transaction gains of $1.8 million were recognized in 2017 related to acquisition activity.

2016 Acquisitions and Dispositions

•

Due to management's decision in the first quarter of 2016 to exit the Republic of Ireland, the prospective impacts of shutting down this operation were included in items not allocated to segments and were excluded from the operating segments effective March 1, 2016. This activity is also excluded from the consolidated non-GAAP results. Beginning May 1, 2016, due to management's decision to also exit Northern Ireland, the results of shutting down these operations were treated similarly to the Republic of Ireland. 2015 revenues from both Ireland operations were approximately $20 million. Charges included in our full-year 2016 GAAP results include $4.9 million in severance costs, $1.8 million in property impairment charges, lease restructuring charges of $0.5 million and an additional $7.0 million in operating and other exit costs. These costs have been excluded from our segment and our consolidated non-GAAP results. International shipments to and from Ireland will continue to be provided through BGS.


•	Amortization expense for acquisition-related intangible assets was $3.6 million in 2016.


•	We recognized a $2.0 million loss related to the sale of corporate assets in 2016.

Argentina highly inflationary impact Beginning in the third quarter of 2018, we designated Argentina's economy as highly inflationary for accounting purposes. As a result, Argentine peso-denominated monetary assets and liabilities are now remeasured at each balance sheet date to the currency exchange rate then in effect, with currency remeasurement gains and losses recognized in earnings. In addition, nonmonetary assets retain a higher historical basis when the currency is devalued. The higher historical basis results in incremental expense being recognized when the nonmonetary assets are consumed. In the second half of 2018, we recognized $8.0 million in pretax charges related to highly inflationary accounting, including currency remeasurement losses of $6.2 million.

Reporting compliance Certain third party compliance costs incurred are excluded from 2018 non-GAAP results. The costs excluded relate to the implementation and January 1, 2019 adoption of the new lease accounting standard ($2.7 million) and the mitigation of material weaknesses ($1.8 million).

Other Operating Income and Expense

Amounts below represent consolidated other operating income and expense.



	Years Ended December 31,							% change
(In millions)	2018			2017		2016		2018		2017

Foreign currency items:
Transaction gains (losses)	$	(13.9	)	(9.2	)	1.4		51		unfav
Foreign currency derivative instrument gains (losses)	7.7			0.8		(2.4	)	fav		fav
Gains (losses) on sale of property	4.0			9.2		(1.3	)	(57	)	fav
Impairment losses	(6.5		)	(3.4	)	(20.6	)	91		(83	)
Share in earnings (losses) of equity affiliates	1.9			0.4		(1.5	)	fav		fav
Royalty income	4.5			1.9		2.6		fav		(27	)
Gains on business acquisitions and dispositions	—			0.6		0.1		(100	)	fav
Other	0.6			3.0		1.6		(80	)	88
Other operating income (expense)	$	(1.7	)	3.3		(20.1	)	unfav		fav

2018 versus 2017

We reported other operating expense of $1.7 million in 2018 versus other operating income of $3.3 million in the prior year. The change was primarily due to higher foreign currency transaction losses in 2018, mainly from remeasurement losses associated with Argentina's highly inflationary accounting. We also recognized lower gains on sale of property as we recognized an $8.4 million gain in Mexico in 2017. Finally, we incurred higher property impairment losses in 2018. These negative factors were partially offset by higher gains on forward currency contracts entered into to hedge currency exposure on intercompany loans. We also recognized additional royalty income in 2018 due to our brand licensing agreement related to our trademark "Brink's Home Security."

2017 versus 2016

We reported other operating income of $3.3 million in 2017 versus other operating expense of $20.1 million in the prior year. The change was primarily due to lower property impairment losses as the prior year included impairment charges resulting from the 2016 restructuring actions. In addition, we recognized an $8.4 million gain in 2017 related to the sale of real estate in Mexico. These positive factors were partially offset by higher foreign currency transaction losses in 2017, primarily from remeasurement losses associated with Venezuela currency devaluation ($9.1 million in 2017 versus $4.8 million in 2016).

Nonoperating Income and Expense

Interest Expense



	Years Ended December 31,				% change
(In millions)	2018		2017	2016	2018	2017

Interest expense	$	66.7	32.2	20.4	unfav	58

Interest expense was higher in 2018 due to higher borrowing levels used to finance the Dunbar acquisition.

Interest expense was higher in 2017 due to higher borrowing levels used to finance the 2017 business acquisitions and business acquisitions completed in 2018.

Loss on deconsolidation of Venezuela operations



	Years Ended December 31,				% change
(In millions)	2018		2017	2016	2018	2017

Loss on deconsolidation of Venezuela operations	$	126.7	—	—	100	—

See Note 1 to the consolidated financial statements for more information about the loss on deconsolidation of our Venezuelan operations.

Interest and Other Nonoperating Income (Expense)



	Years Ended December 31,							% change
(In millions)	2018			2017		2016		2018		2017

Interest income	$	6.9		4.1		2.6		68		58
Gain on equity securities	3.2			1.5		0.5		fav		fav
Foreign currency transaction losses^(a)	(15.5		)	(7.6	)	—		unfav		unfav
Derivative instruments	—			1.1		(0.6	)	(100	)	fav
Retirement benefit cost other than service cost	(39.7		)	(47.8	)	(40.3	)	(17	)	19
Prepayment penalties^(b)	—			(8.3	)	—		(100	)	unfav
Interest on Brazil tax claim