ABM Industries Incorporated
Sep 8, 2011

ABM Industries Announces Third Quarter 2011 Financial Results and Declares Quarterly Dividend

Revenues Increase 24% Driven by Acquired Companies

Weaker Economy Impacts Outlook

NEW YORK--(BUSINESS WIRE)-- ABM Industries Incorporated (NYSE:ABM):

                   
Three Months Ended Nine Months Ended
(in millions, July 31, Increase July 31, Increase
except per share data)     2011   2010   (Decrease) 2011   2010   (Decrease)
                                     
Revenues     $ 1,076.2     $ 869.0     23.8 % $ 3,165.5     $ 2,594.4     22.0 %
                                     
Net cash provided by continuing operating activities     $ 51.0     $ 35.2     44.9 % $ 82.6     $ 73.0     13.1 %
                                     

Income from continuing operations

$ 27.9 $ 21.0 33.1 % $ 50.5 $ 42.4 19.1 %
 
Income from continuing operations per diluted share     $ 0.51     $ 0.40     27.5 % $ 0.93     $ 0.80     16.3 %
                                     
Net income $ 27.9 $ 21.0 33.0 % $ 50.5 $ 42.3 19.2 %
 
Net income per diluted share     $ 0.51     $ 0.40     27.5 % $ 0.93     $ 0.80     16.3 %
 
                                     
Adjusted income from continuing operations $ 27.9 $ 22.0 27.0 % $ 54.6 $ 47.9 13.9 %
 
Adjusted income from continuing operations per diluted share     $ 0.51     $ 0.42     21.4 % $ 1.01     $ 0.91     11.0 %
                                     
Adjusted EBITDA     $ 54.9     $ 45.9     19.7 % $ 132.7     $ 108.0     22.9 %
 
 
(This release refers to non-GAAP financial measures described as "Adjusted EBITDA", "Adjusted Income from Continuing Operations", and "Adjusted Income from Continuing Operations per Diluted Share" (or "Adjusted EPS"). Refer to the accompanying financial tables for supplemental financial data and corresponding reconciliation of these non-GAAP financial measures to certain GAAP financial measures.)
 

ABM Industries Incorporated (NYSE:ABM) today announced revenues for the third quarter of fiscal year 2011 of $1.08 billion, a 23.8% increase compared to third quarter of fiscal year 2010 revenues of $869.0 million. Income from continuing operations for the third quarter of fiscal year 2011 was $27.9 million, a 33.1% increase from $21.0 million in the third quarter of fiscal year 2010. Income from continuing operations per diluted share for the third quarter of fiscal year 2011 increased 27.5% to $0.51 compared to income from continuing operations per diluted share of $0.40 in the third quarter of fiscal year 2010. Income from continuing operations increased primarily as a result of a $4.7 million after-tax increase in Divisional operating profit, driven by the companies acquired in calendar 2010, $4.7 million related to a re-measurement of certain unrecognized tax benefits and $1.5 million after-tax from settling a dispute related to an acquisition. This year-over-year increase in income from continuing operations was partially offset by higher share-based compensation expense of $2.2 million after-tax and a $1.9 million after-tax increase in interest expense compared to the year-ago quarter.

"Our Divisions once again generated quarterly revenues exceeding $1 billion, driven by the companies we acquired last year, and including slight organic growth," said Henrik Slipsager, president and chief executive officer, ABM Industries. "All four Divisions produced higher revenues year-over-year, consistent with prior quarters in the 2011 fiscal year. The higher revenues helped the Divisions' combined operating profit, excluding corporate, increase 15% to more than $60.0 million. Janitorial operating profit increased 4.6%, despite year-over-year increases in fuel costs and state unemployment insurance expenses. Our Engineering and Parking segments generated double digit growth. Engineering profits were up 61.5%, reflecting the contribution from the Linc operations we acquired in the first quarter of the current fiscal year. Parking achieved year-over-year growth of 23.1%, primarily related to operating profit associated with lots acquired in the L&R acquisition. Even as we produced higher revenues and profit in the quarter, we also saw clear signs that the current slow to no growth economy is causing clients to take additional cost containment measures, leading to further price reductions in an already compressed market. This erosion, combined with the shift in revenues from delayed federal appropriations, impacts our view of the fourth quarter."

"In the third quarter, net income and adjusted income from continuing operations both increased to nearly $28 million and $0.51 per diluted share as items impacting comparability did not significantly influence the quarter's results. As noted, our results included the $4.7 million related to a re-measurement of certain unrecognized tax benefits compared to the year-ago quarter, partially offset by the $2.2 million after-tax increase in share-based compensation expense. Adjusted EBIDTA increased to $54.9 million, up nearly 20%, and our adjusted EBITDA margin increased sequentially 114 basis points to 5.1%. We grew our cash from continuing operations, increasing nearly 45% to $51.0 million, compared to the third quarter of fiscal year 2010."

Excluding items impacting comparability, adjusted income from continuing operations was $27.9 million, or $0.51 per diluted share, for the third quarter of fiscal year 2011. This compares to adjusted income from continuing operations of $22.0 million, or $0.42 per diluted share, in the third quarter of fiscal year 2010.

The Company's adjusted EBITDA (earnings before interest, taxes, depreciation and amortization, and excluding discontinued operations and items impacting comparability) for the third quarter of fiscal year 2011 was $54.9 million, a 19.7% increase compared to $45.9 million in the third quarter of fiscal year 2010.

Net cash from continuing operations was $51.0 million in the third quarter of fiscal year 2011, a 44.9% increase compared to $35.2 million in the third quarter of fiscal year 2010.

The Company reported revenues for the nine months ended July 31, 2011 of $3.17 billion, driven by the companies acquired in calendar 2010, a 22.0% increase compared to year-ago revenues of $2.59 billion. Income from continuing operations for the first nine months of fiscal year 2011 was $50.5 million, or $0.93 per diluted share, compared to $42.4 million, or $0.80 per diluted share, for the first nine months of fiscal year 2010. Adjusted income from continuing operations for the first nine months of fiscal year 2011 was $54.6 million, or $1.01 per diluted share, compared to $47.9 million, or $0.91 per diluted share, for the first nine months of fiscal year 2010. Adjusted EBITDA for the first nine months of fiscal year 2011 was $132.7 million, a 22.9% increase compared to $108.0 million for the first nine months of fiscal year 2010. Net cash from continuing operation increased to $82.6 million for the first nine months of fiscal year 2011, a 13.1% increase compared to $73.0 million for the first nine months of fiscal year 2010.

The Company also announced that the Board of Directors has declared a fourth quarter cash dividend of $0.14 per common share payable on November 7, 2011 to stockholders of record on October 6, 2011. This will be ABM's 182nd consecutive quarterly cash dividend.

Guidance

Slipsager concluded: "Through the first two quarters, our performance was essentially in line with our expectations. During the third quarter, it became clear that the U.S. economy will be weaker than anticipated, impacting our clients and resulting in further price compression, particularly in our Janitorial business. Further, as we have previously discussed, the delay in passing federal appropriations had an adverse impact on the timing of awarding contracts to Linc Government Services, which we expect to shift the start of projects from fiscal year 2011 to fiscal year 2012. Taken together, along with higher unemployment insurance expense and fuel and related costs, we are lowering our expectations for the fourth quarter."

The Company now estimates that income from continuing operations per diluted share for the full 2011 fiscal year will be in the lower end of the range of $1.23 to $1.33 and is revising the range for adjusted income from continuing operations per diluted share, for the same period, to $1.32 to $1.42.

Earnings Webcast

On Friday, September 9, 2011, at 9:00 a.m. (EDT), ABM will host a live webcast of remarks by President and Chief Executive Officer Henrik Slipsager and Executive Vice President and Chief Financial Officer James Lusk.

The webcast will be accessible at: http://investor.abm.com/eventdetail.cfm?eventid=101716

Listeners are asked to be online at least 15 minutes early to register, as well as to download and install any complimentary audio software that might be required. Following the call, the webcast will be available at this URL for a period of 90 days.

In addition to the webcast, a limited number of toll-free telephone lines will also be available for listeners who are among the first to call 877-664-7395 within 15 minutes before the event. Telephonic replays will be accessible during the period from two hours to seven days after the call by dialing 855-859-2056 and then entering ID #94700142.

Earnings Webcast Presentation

In connection with the webcast to discuss earnings (see above), a slide presentation related to earnings and operations will be available at the Company's website at www.abm.com and can be accessed through the Investor Relations portion of ABM's website by clicking on the "Presentations" tab.

About ABM Industries Incorporated

ABM Industries Incorporated (NYSE:ABM), which operates through its subsidiaries (collectively "ABM"), is a leading provider of integrated facility services. With fiscal 2010 revenues of approximately $3.5 billion and nearly 100,000 employees, ABM provides commercial cleaning and maintenance, facility engineering, energy efficiency, parking and security services for thousands of commercial, industrial, government and retail clients across the United States and various international locations. ABM's business services include ABM Janitorial Services, ABM Facility Services, ABM Engineering Services, Ampco System Parking and ABM Security Services. For more information, visit www.abm.com.

Cautionary Statement under the Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements that set forth management's anticipated results based on management's current plans and assumptions. Any number of factors could cause the Company's actual results to differ materially from those anticipated. These factors include but are not limited to the following: (1) risks relating to our acquisition of Linc, including risks relating to reductions in government spending on outsourced services as well as payment delays, may adversely affect a significant portion of revenues generated by government contracts, and political and compliance risks, both domestically and abroad, may adversely impact our operations; (2) our acquisition strategy may adversely impact our results of operations; (3) intense competition can constrain our ability to gain business, as well as our profitability; (4) we are subject to volatility associated with high deductibles for certain insurable risks; (5) an increase in costs that we cannot pass on to clients could affect our profitability; (6) we provide our services pursuant to agreements which are generally cancelable by either party upon 30 to 90 days' notice; (7) our success depends on our ability to preserve our long-term relationships with clients; (8) we incur significant accounting and other control costs that reduce profitability; (9) a decline in commercial office building occupancy and rental rates could affect our revenues and profitability; (10) deterioration in economic conditions in general could further reduce the demand for facility services and, as a result, reduce our earnings and adversely affect our financial condition; (11) financial difficulties or bankruptcy of one or more of our major clients could adversely affect results; (12) we are subject to risks relating to foreign currency fluctuations and foreign exchange exposure; (13) our ability to operate and pay our debt obligations depends upon our access to cash; (14) because we conduct our business through operating subsidiaries, we depend on those entities to generate the funds necessary to meet financial obligations; (15) that portion of our revenues which are generated from international operations are subject to political risks and changes in socio-economic conditions, laws and regulations, including labor, monetary and fiscal policies, which could negatively impact our ability to operate and grow our business in the international arena; (16) future declines or fluctuations in the fair value of our investments in auction rate securities that are deemed other-than-temporarily impaired could negatively impact our earnings; (17) uncertainty in the credit markets may negatively impact our costs of borrowings, our ability to collect receivables on a timely basis, and our cash flow; (18) any future increase in the level of debt or in interest rates can affect our results of operations; (19) an impairment charge could have a material adverse effect on our financial condition and results of operations; (20) we are defendants in several class and representative actions or other lawsuits alleging various claims that could cause us to incur substantial liabilities; (21) since we are an attractive employer for recent émigrés to this country and many of our jobs are filled by such, changes in immigration laws or enforcement actions or investigations under such laws could significantly adversely affect our labor force, operations and financial results as well as our reputation; (22) labor disputes could lead to loss of revenues or expense variations; (23) federal health care reform legislation may adversely affect our business and results of operations; (24) we participate in multi-employer defined benefit plans that could result in substantial liabilities being incurred; and (25) natural disasters or acts of terrorism could disrupt our services.

Additional information regarding these and other risks and uncertainties the Company faces is contained in the Company's Annual Report on Form 10-K for the year ended October 31, 2010 and in other reports the Company files from time to time with the Securities and Exchange Commission.

Use of Non-GAAP Financial Information

To supplement ABM's consolidated financial information, the Company has presented income from continuing operations, as adjusted for items impacting comparability, for the third quarter of fiscal years 2011 and 2010. The Company also presents guidance for fiscal year 2011, as adjusted. These adjustments have been made with the intent of providing financial measures that give management and investors a better understanding of the underlying operational results and trends and ABM's marketplace performance. In addition, the Company has presented earnings before interest, taxes, depreciation and amortization and excluding discontinued operations and items impacting comparability (adjusted EBITDA) for the third quarter of fiscal years 2011 and 2010. Adjusted EBITDA is among the indicators management uses as a basis for planning and forecasting future periods. The presentation of these non-GAAP financial measures is not meant to be considered in isolation or as a substitute for financial statements prepared in accordance with generally accepted accounting principles in the United States. (See accompanying financial tables for supplemental financial data and corresponding reconciliations to certain GAAP financial measures.)

Financial Schedules
             
ABM INDUSTRIES INCORPORATED AND SUBSIDIARIES
 
CONDENSED CONSOLIDATED INCOME STATEMENT INFORMATION (UNAUDITED)
 
Three Months Ended July 31, Increase
(In thousands, except per share data)     2011     2010   (Decrease)
 
Revenues $ 1,076,247 $ 869,029 23.8 %
Expenses
Operating 952,844 776,224 22.8 %
Selling, general and administrative 76,356 54,697 39.6 %
Amortization of intangible assets       6,314         2,782       127.0 %
  Total expenses       1,035,514         833,703       24.2 %
Operating profit 40,733 35,326 15.3 %
Income from unconsolidated affiliates, net 1,166 -

NM

*

Interest expense       (4,114 )       (1,149 )     258.1 %
Income from continuing operations
before income taxes 37,785 34,177 10.6 %
Provision for income taxes       (9,874 )       (13,204 )     (25.2 )%
Income from continuing operations 27,911 20,973 33.1 %
Loss from discontinued operations, net of taxes       (36 )       (10 )    

NM

*

Net Income     $ 27,875       $ 20,963       33.0 %
Net Income Per Common Share - Basic
Income from continuing operations $ 0.52 $ 0.40 30.0 %
  Loss from discontinued operations       -         -      

NM

*

  Net Income     $ 0.52       $ 0.40       30.0 %
Net Income Per Common Share - Diluted
Income from continuing operations $ 0.51 $ 0.40 27.5 %
  Loss from discontinued operations       -         -      

NM

*

  Net Income     $ 0.51       $ 0.40       27.5 %
 
* Not Meaningful
 
Average Common And Common Equivalent Shares
Basic 53,207 52,149
Diluted 54,201 52,996
 
Dividends Declared Per Common Share $ 0.140 $ 0.135
 

ABM INDUSTRIES INCORPORATED AND SUBSIDIARIES
             
CONDENSED CONSOLIDATED INCOME STATEMENT INFORMATION (UNAUDITED)
 
Nine Months Ended July 31, Increase
(In thousands, except per share data)     2011     2010     (Decrease)
 
Revenues $ 3,165,499 $ 2,594,374 22.0 %
Expenses
Operating 2,821,672 2,330,299 21.1 %
Selling, general and administrative 242,406 182,743 32.6 %
Amortization of intangible assets       17,273         8,251       109.3 %
  Total expenses       3,081,351         2,521,293       22.2 %
Operating profit 84,148 73,081 15.1 %
Other-than-temporary impairment losses
on auction rate security:
Gross impairment losses - (114 )

NM

*

Impairments recognized in
other comprehensive income - (13 )

NM

*

Income from unconsolidated affiliates, net 2,785 -

NM

*

Interest expense       (12,477 )       (3,541 )     252.4 %
Income from continuing operations
before income taxes 74,456 69,413 7.3 %
Provision for income taxes       (23,940 )       (26,981 )     (11.3 )%
Income from continuing operations 50,516 42,432 19.1 %
Loss from discontinued operations, net of taxes       (60 )       (117 )    

NM

*

Net Income     $ 50,456       $ 42,315       19.2 %
Net Income Per Common Share - Basic
Income from continuing operations $ 0.95 $ 0.81 17.3 %
  Loss from discontinued operations       -         -      

NM

*

  Net Income     $ 0.95       $ 0.81       17.3 %
Net Income Per Common Share - Diluted
Income from continuing operations $ 0.93 $ 0.80 16.3 %
  Loss from discontinued operations       -         -      

NM

*

  Net Income     $ 0.93       $ 0.80       16.3 %
 

* Not Meaningful

 
Average Common And Common Equivalent Shares
Basic 53,051 51,992
Diluted 54,084 52,754
 
Dividends Declared Per Common Share $ 0.420 $ 0.405
 

ABM INDUSTRIES INCORPORATED AND SUBSIDIARIES        
   
SELECTED CONSOLIDATED CASH FLOW INFORMATION (UNAUDITED)
 
Three Months Ended July 31,
(In thousands)     2011     2010
Net cash provided by continuing operating activities 51,028 35,219
Net cash provided by discontinued operating activities       631         748  
Net cash provided by operating activities     $ 51,659       $ 35,967  
Net cash (used in) investing activities     $ (4,840 )     $ (36,193 )
Proceeds from exercises of stock options
(including income tax benefit) 1,788 3,121
Dividends paid (7,444 ) (7,037 )
Borrowings from line of credit 179,000 69,500
Repayment of borrowings from line of credit (210,000 ) (64,500 )
Changes in book cash overdrafts       6,160         11,101  
Net cash (used in) provided by financing activities     $ (30,496 )     $ 12,185  
 
Nine Months Ended July 31,
(In thousands)     2011     2010
Net cash provided by continuing operating activities 82,552 72,959
Net cash provided by discontinued operating activities       2,285         7,331  
Net cash provided by operating activities     $ 84,837       $ 80,290  
Acquisition of Linc (net of cash acquired) (290,253 ) -
Other investing       (12,312 )       (47,932 )
Net cash used in investing activities     $ (302,565 )     $ (47,932 )
Proceeds from exercises of stock options
(including income tax benefit) 9,519 6,166
Dividends paid (22,278 ) (21,051 )
Deferred financing costs paid (4,991 ) -
Borrowings from line of credit 740,500 298,500
Repayment of borrowings from line of credit (516,000 ) (321,000 )
Changes in book cash overdrafts       11,146         3,776  
Net cash provided by (used in) financing activities       217,896       $ (33,609 )
 

ABM INDUSTRIES INCORPORATED AND SUBSIDIARIES
         
CONDENSED CONSOLIDATED BALANCE SHEET INFORMATION (UNAUDITED)
 
July 31, October 31,
(In thousands)     2011     2010
 
Assets
Cash and cash equivalents $ 39,614 $ 39,446
Trade accounts receivable, net 565,267 450,513
Prepaid income taxes 4,187 1,498
Current assets of discontinued operations 2,954 4,260
Prepaid expenses 46,615 41,306
Notes receivable and other 56,923 20,402
Deferred income taxes, net 40,256 46,193
Insurance recoverables       9,240       5,138
Total current assets 765,056 608,756
 
Non-current assets of discontinued operations 322 1,392
Insurance deposits 35,860 36,164
Other investments and long-term receivables 3,273 4,445
Deferred income taxes, net 42,479 51,068
Insurance recoverables 61,557 70,960
Other assets 43,223 37,869
Investments in auction rate securities 15,148 20,171
Investments in unconsolidated affiliates, net 15,911 -
Property, plant and equipment, net 62,055 58,088
Other intangible assets, net 135,119 65,774
Goodwill       746,832       593,983
  Total assets     $ 1,926,835     $ 1,548,670
Liabilities
Trade accounts payable $ 129,076 $ 78,928
Accrued liabilities
Compensation 98,499 89,063
Taxes - other than income 20,141 17,663
Insurance claims 79,316 77,101
Other 114,549 70,119
Income taxes payable       728       977
Total current liabilities 442,309 333,851
 
Income taxes payable 33,791 29,455
Line of credit 365,000 140,500
Retirement plans and other 39,134 34,626
Insurance claims       262,463       271,213
  Total liabilities       1,142,697       809,645
Stockholders' Equity       784,138       739,025
  Total liabilities and stockholders' equity     $ 1,926,835     $ 1,548,670
 

ABM INDUSTRIES INCORPORATED AND SUBSIDIARIES
               
REVENUES AND OPERATING PROFIT BY SEGMENT (UNAUDITED)
 
Three Months Ended July 31, Increase
(In thousands)     2011     2010     (Decrease)
Revenues
Janitorial $ 598,697 $ 575,204 4.1 %
Engineering 236,213 94,383 150.3 %
Parking 153,323 114,222 34.2 %
Security 87,736 84,900 3.3 %
Corporate       278         320       (13.1 )%
          $ 1,076,247       $ 869,029       23.8 %
Operating Profit
Janitorial $ 40,144 $ 38,380 4.6 %
Engineering 9,878 6,118 61.5 %
Parking 7,171 5,823 23.1 %
Security 2,813 2,026 38.8 %
Corporate       (19,273 )       (17,021 )     (13.2 )%
Operating profit 40,733 35,326 15.3 %
Income from unconsolidated affiliates, net 1,166 -

NM

*

Interest expense       (4,114 )       (1,149 )     258.1 %
Income from continuing operations
  before income taxes     $ 37,785       $ 34,177       10.6 %
 
REVENUES AND OPERATING PROFIT BY SEGMENT (UNAUDITED)
 
Nine Months Ended July 31, Increase
(In thousands)     2011     2010     (Decrease)
Revenues
Janitorial $ 1,783,557 $ 1,717,537 3.8 %
Engineering 658,058 285,716 130.3 %
Parking 462,316 340,813 35.7 %
Security 260,630 249,209 4.6 %
Corporate       938         1,099       (14.6 )%
          $ 3,165,499       $ 2,594,374       22.0 %
Operating Profit
Janitorial $ 104,942 $ 101,040 3.9 %
Engineering 24,170 16,415 47.2 %
Parking 16,799 16,033 4.8 %
Security 5,011 4,313 16.2 %
Corporate       (66,774 )       (64,720 )     (3.2 )%
Operating profit 84,148 73,081 15.1 %
Other-than-temporary impairment losses
on auction rate security:
Gross impairment losses - (114 )

NM

*

Impairments recognized in
other comprehensive income - (13 )

NM

*

Income from unconsolidated affiliates, net 2,785 -

NM

*

Interest expense       (12,477 )       (3,541 )     252.4 %
Income from continuing operations
  before income taxes     $ 74,456       $ 69,413       7.3 %
 

* Not Meaningful

 

ABM Industries Incorporated and Subsidiaries        
Reconciliations of Non-GAAP Financial Measures
(Unaudited)    
 
(in thousands, except per share data)
                 
Three Months Ended July 31, Nine Months Ended July 31,
2011 2010   2011 2010
 
Reconciliation of Adjusted Income from Continuing
Operations to Net Income
 
Adjusted income from continuing operations $ 27,882 $ 21,952 $ 54,585 $ 47,917
Items impacting comparability, net of taxes   29     (979 )   (4,069 )   (5,485 )
Income from continuing operations 27,911 20,973 50,516 42,432
 
Loss from discontinued operations   (36 )   (10 )   (60 )   (117 )
 
Net income $ 27,875   $ 20,963   $ 50,456   $ 42,315  
 
Reconciliation of Adjusted Income from Continuing
Operations to Income from Continuing Operations
 
Adjusted income from continuing operations $ 27,882 $ 21,952 $ 54,585 $ 47,917
 
Items impacting comparability:
 
Linc purchase accounting (140 ) - (838 ) -
Corporate initiatives and other (a) (328 ) - (328 ) (1,869 )
Insurance adjustment (1,079 ) - (1,079 ) -
Litigation and other settlements 1,967 (1,006 ) 1,047 (5,406 )
Acquisition costs   (385 )   (552 )   (5,312 )   (1,658 )
Total items impacting comparability 35 (1,558 ) (6,510 ) (8,933 )
Income taxes (expense) benefit   (6 )   579     2,441     3,448  
Items impacting comparability, net of taxes   29     (979 )   (4,069 )   (5,485 )
 
Income from continuing operations $ 27,911   $ 20,973   $ 50,516   $ 42,432  
 
Reconciliation of Adjusted EBITDA to Net Income
 
Adjusted EBITDA $ 54,937 $ 45,912 $ 132,684 $ 107,959
 
Items impacting comparability 35 (1,558 ) (6,510 ) (8,933 )
Discontinued operations (36 ) (10 ) (60 ) (117 )
Income tax (9,874 ) (13,204 ) (23,940 ) (26,981 )
Interest expense (4,114 ) (1,149 ) (12,477 ) (3,541 )
Depreciation and amortization   (13,073 )   (9,028 )   (39,241 )   (26,072 )
 
Net income $ 27,875   $ 20,963   $ 50,456   $ 42,315  
 
(a) Corporate initiatives for the three and nine months ended July 2011 includes the integration costs associated with The Linc Group (TLG). Corporate initiatives for the three and nine months ended July 2010 includes: (i) costs associated with the implementation of a new payroll and human resources information system, (ii) the upgrade of the Company's accounting system, (iii) the completion of the corporate move from San Francisco, (iv) the integration costs associated with OneSource.
 
(Continued)
 
Reconciliation of Adjusted Income from Continuing Operations per Diluted
Share to Income from Continuing Operations per Diluted Share
                 
Three Months Ended July 31, Nine Months Ended July 31,
2011 2010   2011 2010
 
Adjusted income from continuing
operations per diluted share $ 0.51 $ 0.42 $ 1.01 $ 0.91
 
Items impacting comparability, net of taxes   -     (0.02 )   (0.08 )   (0.11 )
Income from continuing operations
per diluted share $ 0.51   $ 0.40   $ 0.93   $ 0.80  
 
Diluted shares 54,201 52,996 54,084 52,754
 

ABM Industries Incorporated and Subsidiaries
Reconciliation of Estimated Adjusted Income from Continuing Operations per Diluted Share to
Income from Continuing Operations per Diluted Share for the Year Ending October 31, 2011
       
 
Year Ending October 31, 2011
Low Estimate     High Estimate
(per diluted share)
 
Adjusted income from continuing operations per diluted share $ 1.32 $ 1.42
 
Adjustments to income from continuing operations (a) (0.09 ) (0.09 )
       
Income from continuing operations per diluted share $ 1.23       $ 1.33  
 
 
(a) Adjustments to income from continuing operations are expected to include transaction and integration costs associated with the acquisition of The Linc Group (TLG) and other unique items impacting comparability.

ABM Industries Incorporated
Investors & Analysts: David Farwell
(212) 297-9792
dfarwell@abm.com
or
Media: Tony Mitchell
(212) 297-9828
tony.mitchell@abm.com

Source: ABM Industries Incorporated

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