Investor Relations
Dec 22, 2024 5:13 AM EST
Revenues Increase 10% Driven by Acquisitions and Organic Growth
Reported EPS
Declares 188th Consecutive Quarterly Dividend
Quarter Ended | |||||||||
(in millions, except per share data) |
|
Increase | |||||||
(unaudited) | 2013 | 2012 | (Decrease) | ||||||
Revenues | $ | 1,182.1 | $ | 1,073.8 | 10.1% | ||||
Income from continuing operations | $ | 13.4 | $ | 10.6 | 26.4% | ||||
Income from continuing operations per diluted share | $ | 0.24 | $ | 0.20 | 20.0% | ||||
Adjusted income from continuing operations | $ | 14.7 | $ | 11.8 | 24.6% | ||||
Adjusted income from continuing operations per diluted share | $ | 0.26 | $ | 0.22 | 18.2% | ||||
Net income | $ | 13.4 | $ | 10.6 | 26.4% | ||||
Net income per diluted share | $ | 0.24 | $ | 0.20 | 20.0% | ||||
Net cash (used in) provided by operating activities | $ | (11.5 | ) | $ | 12.0 | *NM | |||
Adjusted EBITDA | $ | 38.6 | $ | 35.9 | 7.5% | ||||
*Not meaningful | |||||||||
(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.) |
Executive Summary:
First Quarter Results and Recent Events
"We are encouraged by our first quarter operational results," said ABM's
president and chief executive officer
Slipsager continued, "Adjusted income from continuing operations was up
Interest expense for the first quarter of fiscal 2013 was
The effective tax rate for the first quarter of fiscal 2013 was 22.2%, compared to 41.2% in the same period last year, reflecting the retroactive application of employment-based tax credits from calendar 2012 that were recognized during the quarter. The anticipated effective tax rate for fiscal year 2013 is now in the range of 36% to 38%.
Slipsager concluded, "We are enthusiastic about the opportunities for our next phase of growth. We intend to leverage our recently acquired businesses to expand both our global footprint and move ABM's business towards industry verticals. While we are early in the integration process, we are pleased with the pace of integration and sales contributions of our newly acquired companies. In order to realize the long term growth opportunities in facility services and improve our financial performance, we continue to invest in realigning our infrastructure and operations, as well as strategic initiatives, which we believe will grow the overall demand for our businesses."
Dividend
The Company also announced that the Board of Directors has declared a
second quarter cash dividend of
Outlook
At this time, based on the Company's operational results for the first
quarter and its current expectations, the Company is providing guidance
for Income from Continuing Operations of
___________________
1 In the first fiscal quarter of 2013, ABM revised its
reportable segments. The former Facility Solutions segment has been
separated into two new segments:
Earnings Webcast
On
The webcast will be accessible at: http://investor.abm.com/eventdetail.cfm?eventid=125862
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 #13561615.
Earnings Webcast Presentation
In connection with the webcast to discuss earnings (see above), a slide presentation related to earnings and operations will be available on the Company's website at www.abm.com and can be accessed through the Investor Relations section of ABM's website by clicking on the "Presentations" tab.
ABOUT ABM
ABM (NYSE:
ABM) is a leading provider of facility solutions with revenues
exceeding
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 strategy may adversely impact our results of operations; (2)
our strategy of moving to an integrated facility solutions provider
platform, focusing on vertical market strategy, may not generate the
growth in revenues or profitability that we expect; (3) we are subject
to intense competition that can constrain our ability to gain business,
as well as our profitability; (4) increases in costs that we cannot pass
on to clients could affect our profitability; (5) we have high
deductibles for certain insurable risks, and therefore we are subject to
volatility associated with those risks; (6) we primarily provide our
services pursuant to agreements that are 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) our international
business exposes us to additional risks; (9) we conduct some of our
operations through joint ventures, and our ability to do business may be
affected by the failure of our joint venture partners to perform their
obligations or the improper conduct of joint venture employees, joint
venture partners, or agents; (10) significant delays or reductions in
appropriations for our government contracts may negatively affect our
business and could have an adverse effect on our financial position,
results of operations, or cash flows; (11) we are subject to a number of
procurement rules and regulations relating to our business with the
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
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 first quarter of fiscal years 2013 and
2012. 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 as well
as 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 first quarter of fiscal years 2013 and 2012.
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
Financial Schedules | |||||||||||
ABM INDUSTRIES INCORPORATED AND SUBSIDIARIES | |||||||||||
CONSOLIDATED INCOME STATEMENT INFORMATION (UNAUDITED) | |||||||||||
Quarter Ended |
Increase | ||||||||||
(In thousands, except per share data) | 2013 | 2012 | (Decrease) | ||||||||
Revenues | $ | 1,182,123 | $ | 1,073,785 | 10.1 | % | |||||
Expenses | |||||||||||
Operating | 1,067,879 | 966,420 | 10.5 | % | |||||||
Selling, general and administrative | 87,749 | 84,020 | 4.4 | % | |||||||
Amortization of intangible assets | 7,189 | 5,549 | 29.6 | % | |||||||
Total expenses | 1,162,817 | 1,055,989 | 10.1 | % | |||||||
Operating profit | 19,306 | 17,796 | 8.5 | % | |||||||
Income from unconsolidated affiliates, net | 1,195 | 3,132 | (61.8 | )% | |||||||
Interest expense | (3,310 | ) | (2,834 | ) | 16.8 | % | |||||
Income from continuing operations before income taxes |
17,191 | 18,094 | (5.0 | )% | |||||||
Provision for income taxes | (3,809 | ) | (7,454 | ) | (48.9 | )% | |||||
Income from continuing operations | 13,382 | 10,640 | 25.8 | % | |||||||
Loss from discontinued operations, net of taxes | - | (10 | ) | (100.0 | )% | ||||||
Net income | $ | 13,382 | $ | 10,630 | 25.9 | % | |||||
Net income per common share - basic | |||||||||||
Income from continuing operations | $ | 0.25 | $ | 0.20 | 25.0 | % | |||||
Loss from discontinued operations, net of taxes | - | - | - | ||||||||
Net income | $ | 0.25 | $ | 0.20 | 25.0 | % | |||||
Net income per common share - diluted | |||||||||||
Income from continuing operations | $ | 0.24 | $ | 0.20 | 20.0 | % | |||||
Loss from discontinued operations, net of taxes | - | - | - | ||||||||
Net income | $ | 0.24 | $ | 0.20 | 20.0 | % | |||||
Weighted-average common and common equivalent shares outstanding |
|||||||||||
Basic | 54,525 | 53,499 | |||||||||
Diluted | 55,497 | 54,493 | |||||||||
Dividends declared per common share | $ | 0.150 | $ | 0.145 |
ABM INDUSTRIES INCORPORATED AND SUBSIDIARIES | ||||||||
SELECTED CONSOLIDATED CASH FLOW INFORMATION (UNAUDITED) | ||||||||
Quarter Ended |
||||||||
(In thousands) | 2013 | 2012 | ||||||
Net cash (used in) provided by continuing operating activities |
$ | (11,487 | ) | $ | 11,789 | |||
Net cash provided by discontinued operating activities | - | 202 | ||||||
Net cash (used in) provided by operating activities | $ | (11,487 | ) | $ | 11,991 | |||
Purchase of businesses, net of cash acquired | (187,837 | ) | - | |||||
Other | (3,987 | ) | (11,244 | ) | ||||
Net cash used in investing activities | $ | (191,824 | ) | $ | (11,244 | ) | ||
Proceeds from exercises of stock options (including income tax benefit) |
$ | 745 | $ | 2,241 | ||||
Dividends paid | (16,054 | ) | (7,746 | ) | ||||
Deferred financing costs paid | - | (14 | ) | |||||
Borrowings from line of credit | 425,000 | 212,000 | ||||||
Repayment of borrowings from line of credit | (217,000 | ) | (219,000 | ) | ||||
Changes in book cash overdrafts | 4,609 | 2,955 | ||||||
Other | (1,022 | ) | - | |||||
Net cash provided by (used in) financing activities | $ | 196,278 | $ | (9,564 | ) |
ABM INDUSTRIES INCORPORATED AND SUBSIDIARIES | ||||||
CONDENSED CONSOLIDATED BALANCE SHEET INFORMATION (UNAUDITED) | ||||||
|
|
|||||
(In thousands) | 2013 | 2012 | ||||
Assets | ||||||
Cash and cash equivalents | $ | 36,426 | $ | 43,459 | ||
Trade accounts receivable, net | 642,870 | 561,317 | ||||
Notes receivable and other | 35,346 | 43,960 | ||||
Prepaid expenses | 58,687 | 46,672 | ||||
Prepaid income taxes | 251 | 385 | ||||
Deferred income taxes, net | 37,028 | 43,671 | ||||
Insurance recoverables | 9,870 | 9,870 | ||||
Total current assets | 820,478 | 749,334 | ||||
Insurance deposits | 27,982 | 31,720 | ||||
Other investments and long-term receivables | 4,623 | 5,666 | ||||
Investments in unconsolidated affiliates, net | 15,422 | 14,863 | ||||
Investments in auction rate securities | 17,832 | 17,780 | ||||
Property, plant and equipment, net | 74,232 | 59,909 | ||||
Other intangible assets, net | 160,918 | 109,138 | ||||
Goodwill | 869,766 | 751,610 | ||||
Noncurrent deferred income taxes, net | 2,324 | 17,610 | ||||
Noncurrent insurance recoverables | 54,660 | 54,630 | ||||
Other assets | 39,911 | 38,898 | ||||
Total assets | $ | 2,088,148 | $ | 1,851,158 | ||
Liabilities | ||||||
Trade accounts payable | $ | 131,114 | $ | 130,410 | ||
Accrued liabilities | ||||||
Compensation | 119,634 | 121,855 | ||||
Taxes - other than income | 30,140 | 19,437 | ||||
Insurance claims | 80,189 | 80,192 | ||||
Other | 93,850 | 95,473 | ||||
Income taxes payable | 4,227 | 8,450 | ||||
Total current liabilities | 459,154 | 455,817 | ||||
Noncurrent income taxes payable | 29,418 | 27,773 | ||||
Line of credit | 423,000 | 215,000 | ||||
Retirement plans and other | 43,753 | 38,558 | ||||
Noncurrent insurance claims | 273,360 | 263,612 | ||||
Total liabilities | 1,228,685 | 1,000,760 | ||||
Stockholders' equity | 859,463 | 850,398 | ||||
Total liabilities and stockholders' equity | $ | 2,088,148 | $ | 1,851,158 |
ABM INDUSTRIES INCORPORATED AND SUBSIDIARIES | |||||||||||
REVENUES AND OPERATING PROFIT BY SEGMENT (UNAUDITED) | |||||||||||
Quarter Ended |
Increase | ||||||||||
(In thousands) | 2013 | 2012 | (Decrease) | ||||||||
Revenues | |||||||||||
Janitorial | $ | 605,519 | $ | 594,340 | 1.9 | % | |||||
Facility Services | 156,447 | 144,605 | 8.2 | % | |||||||
Parking | 151,237 | 153,450 | (1.4 | )% | |||||||
Security | 96,673 | 91,982 | 5.1 | % | |||||||
Building & Energy Solutions | 87,982 | 89,168 | (1.3 | )% | |||||||
Other | 83,980 | - | *NM | ||||||||
Corporate | 285 | 240 | 18.8 | % | |||||||
Total revenues | $ | 1,182,123 | $ | 1,073,785 | 10.1 | % | |||||
Operating Profit | |||||||||||
Janitorial | $ | 29,074 | $ | 30,508 | (4.7 | )% | |||||
Facility Services | 6,141 | 6,087 | 0.9 | % | |||||||
Parking | 4,823 | 4,750 | 1.5 | % | |||||||
Security | 1,668 | 845 | 97.4 | % | |||||||
Building & Energy Solutions | 796 | 1,290 | (38.3 | )% | |||||||
Other | 1,988 | - | *NM | ||||||||
Corporate | (23,944 | ) | (24,672 | ) | (3.0 | )% | |||||
Adjustment for income from unconsolidated affiliates, net included in Building & Energy Solutions |
(1,240 | ) | (1,012 | ) | 22.5 | % | |||||
Total operating profit | 19,306 | 17,796 | 8.5 | % | |||||||
Income from unconsolidated affiliates, net | 1,195 | 3,132 | (61.8 | )% | |||||||
Interest expense | (3,310 | ) | (2,834 | ) | 16.8 | % | |||||
Income from continuing operations before income taxes |
17,191 | 18,094 | (5.0 | )% | |||||||
Provision for income taxes | (3,809 | ) | (7,454 | ) | (48.9 | )% | |||||
Income from continuing operations | $ | 13,382 | $ | 10,640 | 25.8 | % | |||||
*Not meaningful |
|
||||||||
Reconciliations of Non-GAAP Financial Measures | ||||||||
(Unaudited) | ||||||||
(in thousands, except per share data) | ||||||||
Quarter Ended |
||||||||
2013 | 2012 | |||||||
Reconciliation of Adjusted Income from Continuing Operations to Net Income |
||||||||
Adjusted income from continuing operations | $ | 14,692 | $ | 11,786 | ||||
Items impacting comparability, net of taxes | (1,310 | ) | (1,146 | ) | ||||
Income from continuing operations | 13,382 | 10,640 | ||||||
Loss from discontinued operations, net of taxes | - | (10 | ) | |||||
Net income | $ | 13,382 | $ | 10,630 | ||||
Reconciliation of Adjusted Income from Continuing Operations to Income from Continuing Operations |
||||||||
Adjusted income from continuing operations | $ | 14,692 | $ | 11,786 | ||||
Items impacting comparability: | ||||||||
Corporate initiatives and other (a) | - | (1,426 | ) | |||||
Rebranding (b) | (360 | ) | (731 | ) | ||||
U.S. Foreign Corrupt Practices Act investigation (c) |
(221 | ) | (1,873 | ) | ||||
Gain from equity investment (d) | - | 2,081 | ||||||
Acquisition costs | (320 | ) | - | |||||
Litigation and other settlements | (63 | ) | - | |||||
Restructuring (e) | (1,184 | ) | - | |||||
Total items impacting comparability | (2,148 | ) | (1,949 | ) | ||||
Benefit from income taxes | 838 | 803 | ||||||
Items impacting comparability, net of taxes | (1,310 | ) | (1,146 | ) | ||||
Income from continuing operations | $ | 13,382 | $ | 10,640 | ||||
Reconciliation of Adjusted EBITDA to Net Income | ||||||||
Adjusted EBITDA | $ | 38,593 | $ | 35,913 | ||||
Items impacting comparability | (2,148 | ) | (1,949 | ) | ||||
Loss from discontinued operations, net of taxes | - | (10 | ) | |||||
Provision for income taxes | (3,809 | ) | (7,454 | ) | ||||
Interest expense | (3,310 | ) | (2,834 | ) | ||||
Depreciation and amortization | (15,944 | ) | (13,036 | ) | ||||
Net income | $ | 13,382 | $ | 10,630 | ||||
Reconciliation of Adjusted Income from Continuing Operations per Diluted Share to Income from Continuing Operations per Diluted Share (Unaudited) |
||||||||
Quarter Ended |
||||||||
2013 | 2012 | |||||||
Adjusted income from continuing operations per diluted share |
$ | 0.26 | $ | 0.22 | ||||
Items impacting comparability, net of taxes | (0.02 | ) | (0.02 | ) | ||||
Income from continuing operations per diluted share |
$ | 0.24 | $ | 0.20 | ||||
Diluted shares | 55,497 | 54,493 | ||||||
(a) Corporate initiatives and other includes the integration costs
associated with |
||||||||
(b) Represents costs related to the Company's branding initiative. | ||||||||
(c) Includes legal and other costs incurred in connection with an internal investigation into a foreign entity affiliated with a former joint venture partner. |
||||||||
(d) The Company's share of a gain associated with property sales completed by one of its investments in a low income housing partnership. | ||||||||
(e) Restructuring costs associated with realignment of our infrastructure and operations. |
|
||||||||
Reconciliation of Estimated Adjusted Income from Continuing
Operations per Diluted Share to Income from Continuing Operations
per Diluted Share for the Year Ending |
||||||||
Year Ending |
||||||||
Low Estimate | High Estimate | |||||||
(per diluted share) | ||||||||
Adjusted income from continuing operations per diluted share | $ | 1.35 | $ | 1.45 | ||||
Adjustments to income from continuing operations (a) | $ | (0.19 | ) | $ | (0.19 | ) | ||
Income from continuing operations per diluted share | $ | 1.16 | $ | 1.26 | ||||
(a) Adjustments to income from continuing operations include rebranding costs, restructuring costs associated with realignment of our infrastructure and operations, certain legal settlements and other unique items impacting comparability. |
ABM
Investors & Analysts:
dfarwell@abm.com
or
Media:
chas.strong@abm.com
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