The following is a summary of the Verra Mobility Corp (VRRM) Q1 2024 Earnings Call Transcript:

Financial Performance:

• Verra Mobility's Q1 total revenue increased by 9%, exceeding internal projections.

• Adjusted EBITDA and free cash flow also showed positive growth, increasing 6% and 57% respectively.

• Full year 2024 financial guidance has been upgraded based on the strong Q1 performance.

• The Commercial Services division reported a 12% increase in revenue to $96 million with adjusted EBITDA margins improving by 90 basis points.

• In the Government Solutions unit, recurring service revenue grew by 8%, accounting for 96% of the unit's total revenue.

• T2 Systems added $20 million in revenue for the quarter.

• Net leverage was reduced to 2.4 times, and the company has an open stock buyback authorization of $100 million.

• The disclosed CapEx target for the full year stands at $90 million.

Business Progress:

• The successful introduction of the Verra Mobility Operating System (vmOS) has enhanced operations across all Verra Mobility segments.

• -Growth in the Commercial Services division is being driven by various factors including the addition of toll roads, transition to cashless roads, and new pricing models.

• Verra Mobility is consolidating multiple platforms into one or two in the Government Solutions unit, following several acquisitions.

• Efforts to modernize and improve scalability of the company's system are underway and should be completed by 2025.

• Despite increased system and SG&A expenses, the company expects to maintain or slightly improve its Government Solutions business margins.

• Contract wins are materializing in new Target Addressable Markets (TAMs), with revenue expected to show in the coming quarters.

• The company is actively exploring opportunities in international markets such as Canada, Europe, and Australia.

• The demand for specialized enforcement in specific areas is on an uptrend, while demand for red light cameras remains largely stable but slightly positive.

More details: Verra Mobility IR

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