Cardtronics plc, together with its wholly and majority-owned subsidiaries (collectively, the “Company” or “Cardtronics”), provides convenient automated financial related services to consumers through its global network of automated teller machines and multi-function financial services kiosks (collectively referred to as “ATMs”). The Company is the world’s largest ATM owner/operator, providing services in North America, Europe and Africa, and Australia and New Zealand. The Company evaluates, oversees and manages the financial performance of the business through these three operating segments, further described in Note 17. Segment Information.

The Company’s revenues are generally recurring in nature and historically have been derived primarily from convenience transaction fees (or "surcharge"), which are paid by cardholders, as well as other transaction-based fees, including interchange fees, which are paid by the cardholder’s financial institution for the use of the ATMs serving their customers and connectivity to the applicable electronic funds transfer ("EFT") network that transmits data between the ATM and the cardholder’s financial institution. Other revenue sources include: (i) fees from financial institutions that participate in the Company's Allpoint network ("Allpoint"), the largest retail based surcharge-free ATM network (based on the number of participating ATMs), (ii) fees for bank-branding ATMs and providing financial institution cardholders with surcharge-free access, (iii) revenues earned by providing managed services solutions and transaction processing services to retailers and financial institutions, (iv) fees earned from foreign currency exchange transactions at the ATM, known as dynamic currency conversion ("DCC"), and (v) revenues from the sale of ATMs, ATM-related equipment and other ancillary services.

This Quarterly Report on Form 10-Q (this “Form 10-Q”) has been prepared pursuant to the rules and regulations of the United States ("U.S.") Securities and Exchange Commission (“SEC”) applicable to interim financial information. As this is an interim period filing presented using a condensed format, it does not include all of the disclosures required by accounting principles generally accepted in the U.S. (“U.S. GAAP” or “GAAP”), although the Company believes that the disclosures are adequate to make the information not misleading. This Form 10-Q should be read along with the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (the “2019 Form 10-K”), which includes a summary of the Company’s significant accounting policies and other disclosures.

All normal recurring adjustments necessary for a fair presentation of the Company’s interim and prior period results have been made. The results of operations for the three and nine months ended September 30, 2020 and 2019 are not necessarily indicative of results of operations that may be expected for any other interim period or for the full fiscal year.

The unaudited interim financial statements include the accounts of the Company. All material intercompany accounts and transactions have been eliminated in consolidation. The Company owns a majority (95.7%) interest in, and realizes a majority of the earnings and/or losses of, Cardtronics Mexico, S.A. de C.V.; thus this entity is reflected as a consolidated subsidiary in the financial statements, with the remaining ownership interests not held by the Company being reflected as noncontrolling interests.

The preparation of the unaudited interim financial statements to conform with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of this Form 10-Q and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates and these differences could be material to the financial statements.

The following table reconciles the amounts excluded from the Cost of ATM operating revenues line in the Consolidated Statements of Operations to total depreciation, accretion, and amortization of intangible assets included in the Consolidated Statement of Operations for the periods presented:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In thousands)
Depreciation and accretion expenses related to ATMs and ATM-related assets	$	25,626	$	24,899	$	72,406	$	74,890
Amortization of intangible assets	7,900		12,404		25,162		37,407
Total depreciation, accretion, and amortization of intangible assets excluded from Cost of ATM operating revenues	33,526		37,303		97,568		112,297
Depreciation and accretion expense included in Selling, general, and administrative expenses	7,437		8,567		24,940		24,754
Total depreciation, accretion and amortization of intangible assets	$	40,963	$	45,870	$	122,508	$	137,051

During the three and nine months ended September 30, 2020, the Company continued certain corporate reorganization and cost reduction initiatives that began in 2019. In addition, the Company implemented additional cost reduction measures during the nine months ended September 30, 2020, partly in response to the impacts of the COVID-19 pandemic (the "Pandemic"). In the three and nine months ended September 30, 2020, the Company incurred $2.0 million and $6.6 million, respectively, of pre-tax expenses related to these activities that primarily included facility closures, workforce reductions and other related charges.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In thousands)
Europe & Africa	$	1,894	$	2,335	$	4,971	$	2,735
North America	—		799		1,205		1,012
Australia & New Zealand	114		—		114		—
Corporate	—		449		267		3,299
Total	$	2,008	$	3,583	$	6,557	$	7,046

The costs incurred in Europe & Africa for the three and nine months ended September 30, 2020 and 2019 included facility related costs consisting of non-cash asset write-offs and accelerated lease expenses as well as amounts pertaining to workforce reductions. The costs incurred in North America for the nine months ended September 30, 2020 and the three and nine months ended September 30, 2019 primarily related to workforce reductions. The costs incurred in Australia & New Zealand for the three months ended September 30, 2020 primarily related to workforce reductions. The costs incurred in Corporate for the nine months ended September 30, 2020 and the three and nine months ended September 30, 2019 primarily consisted of professional fees. The restructuring liability balances as of September 30, 2020 and 2019 were $1.0 million and $0.7 million, respectively. The restructuring liability balance as of December 31, 2019 was $1.0 million.

For purposes of reporting financial condition, cash and cash equivalents include cash in bank and short-term deposit accounts. Additionally, the Company maintains cash on deposit with banks that is pledged for a particular use or restricted to support a liability. Current restricted cash primarily consists of amounts collected on behalf of, but not yet remitted to, certain of the Company’s merchant customers or third-party service providers. Restricted cash in current assets is offset by a corresponding liability balance in the Accrued liabilities line in the Consolidated Balance Sheets. The changes in the settlement liabilities corresponding to the changes in the balance of restricted cash during the nine months ended September 30, 2020 and 2019 are presented in the Statements of Cash Flows within the Increase in restricted cash liabilities line.

Accounts and notes receivable are comprised of amounts due from the Company’s clearing and settlement banks for transaction revenues earned on transactions processed during the month ending on the balance sheet date, as well as receivables from bank-branding and network-branding customers, and for ATMs and ATM-related equipment sales and service. Trade accounts receivable are recorded at the invoiced amount and do not bear interest.

The allowance for credit losses represents the Company’s best estimate of the future expected credit losses on the Company's existing accounts and notes receivable. The Company assessed the likelihood of collection of its receivables utilizing historical loss rates and current market conditions that included the estimated impact of the global COVID-19 pandemic. Refer to Note 2. New Accounting Pronouncements for additional information on the development of the Company's estimate of expected credit losses.

The Company recorded a (benefit) provision for estimated credit losses of $(0.5) million and $0.4 million during the three months ending September 30, 2020 and 2019, respectively, and a provision of $0.8 million and $1.0 million during the nine months ending September 30, 2020 and 2019, respectively. As of September 30, 2020, approximately 79% of the Accounts and Notes Receivable balance was current and not yet due.