Verra Mobility (VRRM) Q4 2024 earnings summary

Executive summary

• Full year 2024 revenue reached $879.2 million, up 8% year-over-year, with net income of $31.4 million and net cash from operations of $223.6 million.

• Q4 2024 revenue was $221.5 million, a 5% increase compared to Q4 2023, with adjusted EBITDA up 12% to $102 million and adjusted EPS up 38% to $0.33.

• Free cash flow for Q4 was $22 million, with full-year free cash flow at $153 million (38% of adjusted EBITDA), and net leverage at 2.4x.

• $200 million was deployed for share repurchases in 2024, including $150 million in Q4; share repurchase authorization increased by $100 million in December.

• Net loss in Q4 2024 was $66.7 million, primarily due to a $97 million non-cash goodwill impairment in Parking Solutions.

Financial highlights

• Full year 2024 revenue: $879 million; Q4 revenue: $221.5 million (+5% YoY); adjusted EBITDA: $401.6 million (46% margin); adjusted EPS: $1.23 for 2024, $0.33 for Q4 (+38% YoY).

• Free cash flow for 2024: $153 million (38% conversion of adjusted EBITDA), including a $22.1 million after-tax legal settlement.

• Net leverage at year-end: 2.4x, with net debt of $968 million and $78 million in cash.

• Service revenue comprised 96% of total revenue, primarily recurring.

• Net loss of $67 million in Q4, reflecting the $97 million T2 impairment.

Outlook and guidance

• 2025 guidance: revenue of $925–$935 million (6% growth at midpoint), adjusted EBITDA of $410–$420 million (3% growth at midpoint, 45% margin), adjusted EPS of $1.30–$1.35, free cash flow of $175–$185 million, and net leverage of ~2.0x.

• Capital expenditures expected to be ~$90 million in 2025, mainly for Government Solutions and ERP.

• 2025 assumptions: 163 million diluted shares, 28.5–29.5% tax rate, $110 million D&A, $70 million interest expense, $15 million working capital use.

• Long-term 6–8% revenue growth outlook reaffirmed, with 2026 targets unchanged.