Crane NXT Q3 Earnings Call Highlights

Key Points

• Crane NXT raised the midpoint of its 2026 adjusted EPS guidance to $4.32–$4.42 and expects about 14% sales growth, while maintaining its roughly 24% adjusted EBITDA margin outlook.
• Security and Authentication Technologies (SAT) grew sales 6%, with organic sales up 7%, and backlog rose 8% to about $482 million. Currency and micro-optics demand, including higher Federal Reserve print volumes planned for 2027, is supporting growth and capacity investment.
• Demand remained softer in vending and retail hardware, contributing to a 5% decline in DTT organic sales and a lower full-year DTT growth outlook. Acquisition-related dilution also pressured margins, though management said Antares Vision remains on track for its targeted 2026 EBITDA contribution.

Crane NXT NYSE: CXT raised the midpoint of its full-year adjusted earnings guidance after reporting higher third-quarter sales and free cash flow, as strength in its security technology business helped offset softer demand for vending and retail hardware.

The company now expects 2026 adjusted earnings of $4.32 to $4.42 per share and total sales growth of approximately 14%. It maintained its forecast for an adjusted EBITDA margin of approximately 24%, citing pricing, productivity initiatives and acquisition synergies.

Third-quarter sales rose 12% from a year earlier to $497 million, although organic sales increased just 1%. Adjusted EBITDA grew 4% to $127 million, while adjusted EBITDA margin fell 190 basis points to 25.6%, reflecting expected dilution from the Antares Vision acquisition, Chief Financial Officer Christina Cristiano said.

Adjusted earnings per share were unchanged at $1.28, as higher adjusted operating profit was offset by interest expense associated with the acquisition. Adjusted free cash flow rose 15% to $98 million.

Currency demand supports growth

Sales in the company’s SAT segment increased approximately 6% to $244 million, with organic sales up 7%. Adjusted EBITDA rose 9% to $71 million, and the segment’s adjusted EBITDA margin expanded 60 basis points to 29.2%, helped by volume, favorable mix and synergies in Crane Authentication.

SAT backlog increased 8% to approximately $482 million, near record levels, and the company is booking orders into the second half of 2028, Cristiano said. Crane NXT is accelerating investments in additional micro-optics production lines in the U.S. and Malta to meet international demand.

President and CEO Aaron Saak said the company secured multi-year U.S. government renewals for micro-optics and currency paper. The Bank of Canada also announced that its new $20 banknote will feature Crane NXT’s micro-optics security technology, giving the company a new customer.

Saak said the Federal Reserve’s 2027 print order represented a double-digit increase in volume and included a greater proportion of $100 bills, which use the company’s micro-optics. Crane NXT typically operates three to four months ahead of the Bureau of Engraving and Printing’s requirements and expects to begin realizing the benefit early in 2027, he said.

Cristiano said the company has capacity to fulfill its 2027 orders and expects about 65% of its existing backlog to be delivered that year. Capital spending will pick up in the fourth quarter at Crane Currency, although companywide spending is still expected to be between 4% and 5% of sales for the year, she said.

Hardware weakness weighs on DTT outlook

DTT sales rose 17% to $254 million, but organic sales declined 5%. Growth in CPI service was more than offset by weakness in vending and hardware markets, while Antares Vision sales were affected by the timing of life sciences projects, Cristiano said.

DTT adjusted EBITDA increased 2% to $71 million, as pricing and productivity offset the impact of lower organic volume. The segment’s adjusted EBITDA margin fell 430 basis points, reflecting expected dilution from Antares Vision. DTT backlog was approximately $234 million, including about $125 million from Antares.

For the full year, Crane NXT expects DTT sales growth in the high teens, a lower outlook than its previous midpoint. SAT sales are expected to grow approximately 11%, modestly better than the prior midpoint.

Saak said several big-box retailers had delayed previously announced equipment upgrades and refresh programs, creating a headwind for CPI’s hardware business. Vending was tracking slightly softer, at roughly flat growth for the year, while multi-vendor services continued to grow, he said.

Some pharmaceutical customers have asked to move equipment deliveries into the first quarter of 2027 because installing the systems requires production lines to stop, Saak said. Despite the delays, he said Antares remained on track to meet its targeted 2026 adjusted EBITDA contribution.

2027 outlook and capital priorities

Management expects continued SAT growth and margin improvement in 2027, supported by backlog conversion and Authentication synergies. It also expects growth at Antares Vision and CPI service, while anticipating continued softness in CPI hardware markets. The company plans to provide full 2027 guidance on its fourth-quarter earnings call.

Crane NXT ended the third quarter with net leverage of approximately 2.5 times and expects to reach approximately 2.3 times by year-end. Saak said capital priorities include organic growth investments, debt repayment and dividends, followed by a potential combination of share buybacks or acquisitions. For the next several months, he said, the acquisition focus is integrating Antares Vision.

About Crane NXT (NYSE:CXT)

Crane NXT, Co is a technology company that develops solutions for payment acceptance, cash management, currency security and brand protection. The company serves businesses and government organizations that require secure, reliable methods for processing transactions, managing cash and authenticating products and documents.

Its Payment & Merchandising Technologies segment provides payment and cash-handling equipment and software for applications including retail, vending, gaming, transportation and other automated or self-service environments.

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