展示99.1
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ローリンズ、インク。が2024年第3四半期の財務結果を報告
健康な市場を活用して成長への投資
2024年10月23日、ジョージア州アトランタ：ローリンズ、インク（nyse:ＲＯＬ）（以下「ローリンズ」または「会社」）は、一流のグローバル消費関連および商業サービス企業で、2024年第3四半期の未監査の財務結果を報告しました。
主要なハイライト
•2023年第3四半期の収益は9,1600万ドルで、2023年第3四半期と比較して9.0%増加し、オーガニック収益*も7.7%増加しました。
•四半期の営業利益は$19200万で、2023年第三四半期比で8.3%増加しました。四半期の営業利益率は20.9%で、2023年第三四半期比20ベースポイント減少しました。調整後の営業利益は$19600万で、前年比で4.5%増加しました。調整後の営業利益率は21.4%で、前年比90ベースポイント減少しました。
•調整後のEBITDA*は$ 21900万で、前年比5.5%増加しました。調整後のEBITDAマージン*は24.0％であり、2023年第3四半期と比較してベースポイント80減少しました。
•四半期の当期純利益は13700万ドルで、前年比7.1%増加しました。調整後の当期純利益は14000万ドルで、前年比3.3%増加しました。
•四半期epsは希薄化後の株式あたり0.28ドルでした。前年のeps 0.26ドルより7.7%増加しました。調整後のeps*は、希薄化後の株式あたり0.29ドルであり、前年比3.6%増加しました。
•四半期の運用キャッシュ・フローは1億4700万ドルで、前年比15.4%増加しました。会社は買収に2億4000万ドル、設備投資に800万ドルを投資し、配当総額は7億3000万ドル支払いました。
*金額はGAAP非金融指標です。非GAAPの財務尺度に関する議論や、最も直接的に比較可能なGAAP尺度の調整については、以下のスケジュールを参照してください。
経営陣のコメント
弊社チームは、3四半期においてオーガニック売上高が7.7％成長し、年間で議論している7％から8％の範囲の上限である。ジェリー・ガルホフJr.社長兼CEOは、「四半期の最終週にハリケーン・ヘレンからの運営の一時的な混乱にもかかわらず、弊社は力強い成績を収めました」と述べました。「最近のハリケーンに影響を受けた方々全員を思っています。チームは、これら天災の影響を受けた仲間やコミュニティを支援するために手を組みました。これらの自然災害の後、弊社の取り組みは今後も続くでしょう。お互い、お客様への継続的なコミットメントに感謝いたします」とガルホフ氏はコメントしました。
「私たちは健全な市場環境を活用し、ビジネスをさらに成長させるためにチームやその他のリソースへの投資を続けています。」とエグゼクティブバイスプレジデント兼最高財務責任者のケネスクラウスは述べました。粗利率の20ベーシスポイントのレバレッジは、四半期全体のマージンパフォーマンスを押し下げる成長投資にオフセットされましたが、私達の新規買目標をサポートします。今年は健康なマージン改善と二桁の利益成長を実現する予定です。」とクラウス氏は結論づけました。
ボードリーダーシップの移行
また、本日、会社は2025年1月1日をもって、80歳のゲーリー・W・ローリンズがエグゼクティブチェアマンからエグゼクティブチェアマン・エメリタスへ移行し、計画されていた長期的な指導体制の継承目標に従います。ゲーリーの後任として、現在の副会長であるジョン・F・ウィルソンがエグゼクティブチェアマンに就任します。
「1996年に当社に入社して以来、ジョンと密接に仕事をしてきたことを喜ばしく思います。この重要なリーダーシップ役割への移行に支援することを楽しみにしており、私は当社の優れた取締役会のアクティブかつ熱心なメンバーのままでいるでしょう」と、取締役会の執行委員長であるゲイリー・W・ローリンズは述べました。
「取締役会を代表して、当社の最高独立取締役であるルイーズ・S・サムズは『ジョンの新しい役割へのお祝いを申し上げ、ゲイリー、そして全ての経営チームと共に、ビジネスを成長の次のフェーズに導くことを楽しみにしています』と述べました。」
1
三か月と九か月が終了した財務ハイライト
| 9月30日までの3か月間 | 9月30日までの9ヶ月間 | ||||||||||||||||||||||||||||||||||||||||
| 差異 | 差異 | ||||||||||||||||||||||||||||||||||||||||
| (株式データ以外は、千の数字で表示されます) | 2024 | 2023 | $ | % | 2024 | 2023 | $ | % | |||||||||||||||||||||||||||||||||
| GAAP指数 | |||||||||||||||||||||||||||||||||||||||||
| 収益 | $ | 916,270 | $ | 840,427 | $ | 75,843 | 9.0 | % | $ | 2,556,539 | $ | 2,319,192 | $ | 237,347 | 10.2 | % | |||||||||||||||||||||||||
粗利益 (粗利益がマイナス) 1,433 (467) -- 2,358 964 --(1) | $ | 494,378 | $ | 451,894 | $ | 42,484 | 9.4 | % | $ | 1,358,804 | $ | 1,219,626 | $ | 139,178 | 11.4 | % | |||||||||||||||||||||||||
粗利益率 (1) | 54.0 | % | 53.8 | % | 20 | 53.2 | % | 52.6 | % | 60 | |||||||||||||||||||||||||||||||
| 営業利益 | $ | 191,796 | $ | 177,124 | $ | 14,672 | 8.3 | % | $ | 506,597 | $ | 444,153 | $ | 62,444 | 14.1 | % | |||||||||||||||||||||||||
| 営業利益率 | 20.9 | % | 21.1 | % | (20) | ベーシス・ポイント(1bps=0.01%) | 19.8 | % | 19.2 | % | 60 | ||||||||||||||||||||||||||||||
| 当期純利益 | $ | 136,913 | $ | 127,777 | $ | 9,136 | 7.1 | % | $ | 360,704 | $ | 326,154 | $ | 34,550 | 10.6 | % | |||||||||||||||||||||||||
| EPS | $ | 0.28 | $ | 0.26 | $ | 0.02 | 7.7 | % | $ | 0.74 | $ | 0.66 | $ | 0.08 | 12.1 | % | |||||||||||||||||||||||||
| 営業キャッシュフロー | $ | 146,947 | $ | 127,355 | $ | 19,592 | 15.4 | % | $ | 419,495 | $ | 375,541 | $ | 43,954 | 11.7 | % | |||||||||||||||||||||||||
| 非GAAPメトリック | |||||||||||||||||||||||||||||||||||||||||
調整後の営業利益 (2) | $ | 196,012 | $ | 187,582 | $ | 8,430 | 4.5 | % | $ | 520,286 | $ | 459,872 | $ | 60,414 | 13.1 | % | |||||||||||||||||||||||||
調整後営業利益率 (2) | 21.4 | % | 22.3 | % | (90) | ベーシス・ポイント(1bps=0.01%) | 20.4 | % | 19.8 | % | 60 | ||||||||||||||||||||||||||||||
調整後当期純利益(2) | $ | 139,617 | $ | 135,191 | $ | 4,426 | 3.3 | % | $ | 370,194 | $ | 333,217 | $ | 36,977 | 11.1 | % | |||||||||||||||||||||||||
調整後のEPS(2) | $ | 0.29 | $ | 0.28 | $ | 0.01 | 3.6 | % | $ | 0.76 | $ | 0.68 | $ | 0.08 | 11.8 | % | |||||||||||||||||||||||||
売上高 調整後 EBITDA の貢献度(2) | $ | 219,460 | $ | 208,038 | $ | 11,422 | 5.5 | % | $ | 590,331 | $ | 525,055 | $ | 65,276 | 12.4 | % | |||||||||||||||||||||||||
調整後のEBITDAマージン(2) | 24.0 | % | 24.8 | % | (80) | ベーシス・ポイント(1bps=0.01%) | 23.1 | % | 22.6 | % | 50 | ||||||||||||||||||||||||||||||
フリーキャッシュフロー(2) | $ | 139,425 | $ | 120,487 | $ | 18,938 | 15.7 | % | $ | 396,106 | $ | 354,262 | $ | 41,844 | 11.8 | % | |||||||||||||||||||||||||
（1）減価償却前の金額
（2）金額は非GAAP財務指標です。非GAAP財務メトリクスに関する議論、最も直接的に比較可能なGAAP指標との調整を含む、このリリースの付録を参照してください。
ロリンズについて：
ローリンズは、一流のグローバル消費者および商業サービス企業です。同社とそのフランチャイズが提供する主要ブランドを通じて、北アメリカ、南アメリカ、ヨーロッパ、アジア、アフリカ、オーストラリアの280万以上の顧客に対して、害虫駆除やシロアリ被害、げっ歯類、昆虫に対する保護を提供しています。800カ所以上から20000人以上の従業員を擁し、オーキン、ホームチームペストディフェンス、クラークペストコントロール、ノースウェスト殺虫、マッカールサービス、トルーテック、クリッターコントロール、ウエスタンペストサービス、ワルサムサービス、OPCペストサービス、インダストリアルフミガントカンパニー、PermaTreat、Crane Pest Control、MissQuito、Fox Pest Control、Orkin Canada、Orkin Australia、Safeguard（UK）、Aardwolf Pestkare（Singapore）を傘下に持っています。Rollinsとその子会社については、www.rollins.comをご覧いただくことで詳細を学ぶことができます。g www.rollins.com.
このニュースリリースでほかの過去の事実に基づかない、行動、イベント、または開発に関するすべての声明は、フォワードルッキングな声明である場合があります。管理部門は、ここに含まれるすべてのフォワードルッキングな声明を現在の期待に基づいていますが、その期待に基づいていた情報は変更される可能性があります。これらのフォワードルッキングな声明は、将来のイベントに関する仮定に基づいており、Trioのコントロール外の多くのリスク、不確実性、およびその他の要因に依存しており、実際の結果はこれらの声明と異なる可能性があります。これらのリスク、不確実性、およびその他の要因には、TrioのS-1でリスクファクターのセクションに示されているものも含まれます。これらの文書のコピーは、SECのウェブサイトの「www.sec.gov」で入手できます。Trioは、法律で定められた場合を除き、このリリースの日付の後にこれらのステートメントを修正または変更することはありません。
このプレスリリース、および会社によるその他の書面または口頭での声明には、1995年の民事訴訟法改正法で定義される「将来を見据えた声明」が含まれる場合があります。これらの将来を見据えた声明は、現在の意見、期待、意図、信念、計画、目標、仮定、および将来の出来事や当社の事業の業績および財務状況に影響を与える金融動向についての予測に基づいています。これらの将来を見据えた声明が合理的であると考えていますが、これらの計画、意図、または期待を達成または実現することを保証することはできません。歴史的事実に関連しない、つまり、可能ないしは想定される将来の行動、ビジネス戦略、出来事、あるいは業績に関する声明を含むが、過去の状況とは関係のない声明は、将来を見据えた声明となります。 「信じる」、「継続する」、「できる」、「推定する」、「期待する」、「意図する」、「かもしれない」、「計画する」、「可能性がある」、「予測する」、「すべきである」、「するであろう」などの表現が、将来を見据えた声明を特定することがありますが、これらの単語がない場合でも、その声明が将来を見据えたものでないことを意味するわけではありません。このプレスリリースの中での将来を見据えた声明には、以下に限定されることなく、次のような声明が含まれます：財務および事業のパフォーマンスに関する期待；当社のサービスへの需要；予想される成長；健全な市場環境を活かすためにチームやその他のリソースへの投資を継続すること；および取締役会のリーダーシップの移行。
These forward-looking statements are based on information available as of the date of this press release, and current expectations, forecasts, and assumptions, and involve a number of judgments, risks and uncertainties. Important factors could cause actual results to differ materially from those indicated or implied by forward-looking statements including, but not limited to, those set forth in the sections entitled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and may also be described from time to time in our future reports filed with the SEC.
Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required by law.
Conference Call
Rollins will host a conference call on Thursday, October 24, 2024 at 8:30 a.m. Eastern Time to discuss the third quarter 2024 results. The conference call will also broadcast live over the internet via a link provided on the Rollins, Inc. website at www.rollins.com. Interested parties can also dial into the call at 1-877-869-3839 (domestic) or +1-201-689-8265 (internationally) with conference ID of 13749018. For interested individuals unable to join the call, a replay will be available on the website for 180 days.
2
ROLLINS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(in thousands)
(unaudited)
| September 30, 2024 | December 31, 2023 | ||||||||||
| ASSETS | |||||||||||
| Cash and cash equivalents | $ | 95,282 | $ | 103,825 | |||||||
| Trade receivables, net | 226,452 | 178,214 | |||||||||
| Financed receivables, short-term, net | 39,289 | 37,025 | |||||||||
| Materials and supplies | 39,283 | 33,383 | |||||||||
| Other current assets | 86,196 | 54,192 | |||||||||
| Total current assets | 486,502 | 406,639 | |||||||||
| Equipment and property, net | 129,168 | 126,661 | |||||||||
| Goodwill | 1,135,122 | 1,070,310 | |||||||||
| Intangibles, net | 540,721 | 545,734 | |||||||||
| Operating lease right-of-use assets | 391,626 | 323,390 | |||||||||
| Financed receivables, long-term, net | 87,880 | 75,909 | |||||||||
| Other assets | 45,179 | 46,817 | |||||||||
| Total assets | $ | 2,816,198 | $ | 2,595,460 | |||||||
| LIABILITIES | |||||||||||
| Accounts payable | $ | 58,217 | $ | 49,200 | |||||||
| Accrued insurance – current | 50,106 | 46,807 | |||||||||
| Accrued compensation and related liabilities | 108,227 | 114,355 | |||||||||
| Unearned revenues | 201,909 | 172,380 | |||||||||
| Operating lease liabilities – current | 113,727 | 92,203 | |||||||||
| Other current liabilities | 89,882 | 101,744 | |||||||||
| Total current liabilities | 622,068 | 576,689 | |||||||||
| Accrued insurance, less current portion | 57,510 | 48,060 | |||||||||
| Operating lease liabilities, less current portion | 280,555 | 233,369 | |||||||||
| Long-term debt | 445,176 | 490,776 | |||||||||
| Other long-term accrued liabilities | 93,112 | 90,999 | |||||||||
| Total liabilities | 1,498,421 | 1,439,893 | |||||||||
| STOCKHOLDERS’ EQUITY | |||||||||||
| Common stock | 484,306 | 484,080 | |||||||||
| Retained earnings and other equity | 833,471 | 671,487 | |||||||||
| Total stockholders’ equity | 1,317,777 | 1,155,567 | |||||||||
| Total liabilities and stockholders’ equity | $ | 2,816,198 | $ | 2,595,460 | |||||||
3
ROLLINS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands except per share data)
(unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| REVENUES | |||||||||||||||||||||||
| Customer services | $ | 916,270 | $ | 840,427 | $ | 2,556,539 | $ | 2,319,192 | |||||||||||||||
| COSTS AND EXPENSES | |||||||||||||||||||||||
| Cost of services provided (exclusive of depreciation and amortization below) | 421,892 | 388,533 | 1,197,735 | 1,099,566 | |||||||||||||||||||
| Sales, general and administrative | 274,918 | 244,906 | 769,522 | 696,668 | |||||||||||||||||||
| Restructuring costs | — | 5,196 | — | 5,196 | |||||||||||||||||||
| Depreciation and amortization | 27,664 | 24,668 | 82,685 | 73,609 | |||||||||||||||||||
| Total operating expenses | 724,474 | 663,303 | 2,049,942 | 1,875,039 | |||||||||||||||||||
| OPERATING INCOME | 191,796 | 177,124 | 506,597 | 444,153 | |||||||||||||||||||
| Interest expense, net | 7,150 | 5,547 | 22,650 | 10,797 | |||||||||||||||||||
| Other income, net | (582) | (493) | (933) | (6,226) | |||||||||||||||||||
| CONSOLIDATED INCOME BEFORE INCOME TAXES | 185,228 | 172,070 | 484,880 | 439,582 | |||||||||||||||||||
| PROVISION FOR INCOME TAXES | 48,315 | 44,293 | 124,176 | 113,428 | |||||||||||||||||||
| NET INCOME | $ | 136,913 | $ | 127,777 | $ | 360,704 | $ | 326,154 | |||||||||||||||
| NET INCOME PER SHARE - BASIC AND DILUTED | $ | 0.28 | $ | 0.26 | $ | 0.74 | $ | 0.66 | |||||||||||||||
| Weighted average shares outstanding - basic | 484,317 | 490,775 | 484,231 | 491,980 | |||||||||||||||||||
| Weighted average shares outstanding - diluted | 484,359 | 490,965 | 484,270 | 492,158 | |||||||||||||||||||
| DIVIDENDS PAID PER SHARE | $ | 0.15 | $ | 0.13 | $ | 0.45 | $ | 0.39 | |||||||||||||||
4
ROLLINS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED CASH FLOW INFORMATION
(in thousands)
(unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| OPERATING ACTIVITIES | |||||||||||||||||||||||
| Net income | $ | 136,913 | $ | 127,777 | $ | 360,704 | $ | 326,154 | |||||||||||||||
| Depreciation and amortization | 27,664 | 24,668 | 82,685 | 73,609 | |||||||||||||||||||
| Change in working capital and other operating activities | (17,630) | (25,090) | (23,894) | (24,222) | |||||||||||||||||||
| Net cash provided by operating activities | 146,947 | 127,355 | 419,495 | 375,541 | |||||||||||||||||||
| INVESTING ACTIVITIES | |||||||||||||||||||||||
| Acquisitions, net of cash acquired | (23,875) | (21,420) | (105,529) | (349,312) | |||||||||||||||||||
| Capital expenditures | (7,522) | (6,868) | (23,389) | (21,279) | |||||||||||||||||||
| Other investing activities, net | 1,458 | (2,424) | 5,358 | 8,257 | |||||||||||||||||||
| Net cash used in investing activities | (29,939) | (30,712) | (123,560) | (362,334) | |||||||||||||||||||
| FINANCING ACTIVITIES | |||||||||||||||||||||||
| Net (repayments) borrowings | (57,000) | 259,000 | (46,000) | 544,000 | |||||||||||||||||||
| Payment of dividends | (72,797) | (63,809) | (217,964) | (191,805) | |||||||||||||||||||
| Other financing activities, net | (1,823) | (301,643) | (41,542) | (318,452) | |||||||||||||||||||
| Net cash (used in) provided by financing activities | (131,620) | (106,452) | (305,506) | 33,743 | |||||||||||||||||||
| Effect of exchange rate changes on cash and cash equivalents | 3,197 | (2,691) | 1,028 | (49) | |||||||||||||||||||
| Net (decrease) increase in cash and cash equivalents | $ | (11,415) | $ | (12,500) | $ | (8,543) | $ | 46,901 | |||||||||||||||
5
APPENDIX
Reconciliation of GAAP and non-GAAP Financial Measures
The Company has used the non-GAAP financial measures of organic revenues, organic revenues by type, adjusted operating income, adjusted operating margin, adjusted net income, adjusted earnings per share (“EPS”), earnings before interest, taxes, depreciation and amortization (“EBITDA”), EBITDA margin, Adjusted EBITDA, adjusted EBITDA margin, incremental EBITDA margin, adjusted incremental EBITDA margin, free cash flow, free cash flow conversion, net debt, net leverage ratio, and adjusted sales, general and administrative expenses ("SG&A") in this earnings release. Organic revenue is calculated as revenue less the revenue from acquisitions completed within the prior 12 months and excluding the revenue from divested businesses. Acquisition revenue is based on the trailing 12-month revenue of our acquired entities. Adjusted operating income and adjusted operating income margin are calculated by adding back to the GAAP measures those expenses resulting from the amortization of certain intangible assets, adjustments to the fair value of contingent consideration resulting from the acquisition of Fox, and restructuring costs related to restructuring and workforce reduction plans. Adjusted net income and adjusted EPS are calculated by adding back to the GAAP measure amortization of certain intangible assets, adjustments to the fair value of contingent consideration resulting from the acquisition of Fox, and restructuring costs related to restructuring and workforce reduction plans, and excluding gains and losses on the sale of non-operational assets and by further subtracting the tax impact of those expenses, gains, or losses. Adjusted EBITDA and adjusted EBITDA margin are calculated by adding back to the GAAP measures those expenses resulting from the adjustments to the fair value of contingent consideration resulting from the acquisition of Fox, restructuring costs related to restructuring and workforce reduction plans, and excluding gains and losses on the sale of non-operational assets. Incremental EBITDA margin is calculated as the change in EBITDA divided by the change in revenue. Adjusted incremental EBITDA margin is calculated as the change in adjusted EBITDA divided by the change in revenue. Free cash flow is calculated by subtracting capital expenditures from cash provided by operating activities. Free cash flow conversion is calculated as free cash flow divided by net income. Net debt is calculated as total long-term debt less cash and cash equivalents. Net leverage ratio is calculated by dividing net debt by trailing twelve-month EBITDA. Adjusted SG&A is calculated by removing the adjustments to the fair value of contingent consideration resulting from the acquisition of Fox. These measures should not be considered in isolation or as a substitute for revenues, net income, earnings per share or other performance measures prepared in accordance with GAAP.
Management uses adjusted operating income, adjusted operating income margin, adjusted net income, adjusted EPS, EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, incremental EBITDA margin, adjusted incremental EBITDA margin, and adjusted SG&A as measures of operating performance because these measures allow the Company to compare performance consistently over various periods. Management also uses organic revenues, and organic revenues by type to compare revenues over various periods excluding the impact of acquisitions and divestitures. Management uses free cash flow to demonstrate the Company’s ability to maintain its asset base and generate future cash flows from operations. Management uses free cash flow conversion to demonstrate how much net income is converted into cash. Management uses net debt as an assessment of overall liquidity, financial flexibility, and leverage. Net leverage ratio is useful to investors because it is an indicator of our ability to meet our future financial obligations. Management believes all of these non-GAAP financial measures are useful to provide investors with information about current trends in, and period-over-period comparisons of, the Company's results of operations. An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP.
A non-GAAP financial measure is a numerical measure of financial performance, financial position, or cash flows that either 1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows, or 2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented.
Set forth below is a reconciliation of the non-GAAP financial measures used in this earnings release with their most directly comparable GAAP measures.
(unaudited, in thousands, except per share data and margins)
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| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Variance | Variance | ||||||||||||||||||||||||||||||||||||||||||||||
| 2024 | 2023 | $ | % | 2024 | 2023 | $ | % | ||||||||||||||||||||||||||||||||||||||||
| Reconciliation of Operating Income to Adjusted Operating Income and Adjusted Operating Income Margin | |||||||||||||||||||||||||||||||||||||||||||||||
| Operating income | $ | 191,796 | $ | 177,124 | $ | 506,597 | $ | 444,153 | |||||||||||||||||||||||||||||||||||||||
Fox acquisition-related expenses (1) | 4,216 | 5,262 | 13,689 | 10,523 | |||||||||||||||||||||||||||||||||||||||||||
Restructuring costs (2) | — | 5,196 | — | 5,196 | |||||||||||||||||||||||||||||||||||||||||||
| Adjusted operating income | $ | 196,012 | $ | 187,582 | 8,430 | 4.5 | $ | 520,286 | $ | 459,872 | 60,414 | 13.1 | |||||||||||||||||||||||||||||||||||
| Revenues | $ | 916,270 | $ | 840,427 | $ | 2,556,539 | $ | 2,319,192 | |||||||||||||||||||||||||||||||||||||||
| Operating income margin | 20.9 | % | 21.1 | % | 19.8 | % | 19.2 | % | |||||||||||||||||||||||||||||||||||||||
| Adjusted operating margin | 21.4 | % | 22.3 | % | 20.4 | % | 19.8 | % | |||||||||||||||||||||||||||||||||||||||
Reconciliation of Net Income to Adjusted Net Income and Adjusted EPS (6) | |||||||||||||||||||||||||||||||||||||||||||||||
| Net income | $ | 136,913 | $ | 127,777 | $ | 360,704 | $ | 326,154 | |||||||||||||||||||||||||||||||||||||||
Fox acquisition-related expenses (1) | 4,216 | 5,262 | 13,689 | 10,523 | |||||||||||||||||||||||||||||||||||||||||||
Restructuring costs (2) | — | 5,196 | — | 5,196 | |||||||||||||||||||||||||||||||||||||||||||
Gain on sale of assets, net (3) | (582) | (493) | (933) | (6,226) | |||||||||||||||||||||||||||||||||||||||||||
Tax impact of adjustments (4) | (930) | (2,551) | (3,266) | (2,430) | |||||||||||||||||||||||||||||||||||||||||||
| Adjusted net income | $ | 139,617 | $ | 135,191 | 4,426 | 3.3 | $ | 370,194 | $ | 333,217 | 36,978 | 11.1 | |||||||||||||||||||||||||||||||||||
| EPS - basic and diluted | $ | 0.28 | $ | 0.26 | $ | 0.74 | $ | 0.66 | |||||||||||||||||||||||||||||||||||||||
Fox acquisition-related expenses (1) | 0.01 | 0.01 | 0.03 | 0.02 | |||||||||||||||||||||||||||||||||||||||||||
Restructuring costs (2) | — | 0.01 | — | 0.01 | |||||||||||||||||||||||||||||||||||||||||||
Gain on sale of assets, net (3) | — | — | — | (0.01) | |||||||||||||||||||||||||||||||||||||||||||
Tax impact of adjustments (4) | — | (0.01) | (0.01) | — | |||||||||||||||||||||||||||||||||||||||||||
Adjusted EPS - basic and diluted (5) | $ | 0.29 | $ | 0.28 | 0.01 | 3.6 | $ | 0.76 | $ | 0.68 | 0.08 | 11.8 | |||||||||||||||||||||||||||||||||||
| Weighted average shares outstanding – basic | 484,317 | 490,775 | 484,231 | 491,980 | |||||||||||||||||||||||||||||||||||||||||||
| Weighted average shares outstanding – diluted | 484,359 | 490,965 | 484,270 | 492,158 | |||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Net Income to EBITDA, Adjusted EBITDA, EBITDA Margin, Incremental EBITDA Margin, Adjusted EBITDA Margin, and Adjusted Incremental EBITDA Margin (6) | |||||||||||||||||||||||||||||||||||||||||||||||
| Net income | $ | 136,913 | $ | 127,777 | $ | 360,704 | $ | 326,154 | |||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | 27,664 | 24,668 | 82,685 | 73,609 | |||||||||||||||||||||||||||||||||||||||||||
| Interest expense, net | 7,150 | 5,547 | 22,650 | 10,797 | |||||||||||||||||||||||||||||||||||||||||||
| Provision for income taxes | 48,315 | 44,293 | 124,176 | 113,428 | |||||||||||||||||||||||||||||||||||||||||||
| EBITDA | $ | 220,042 | $ | 202,285 | 17,757 | 8.8 | $ | 590,215 | $ | 523,988 | 66,227 | 12.6 | |||||||||||||||||||||||||||||||||||
Fox acquisition-related expenses (1) | — | 1,050 | 1,049 | 2,097 | |||||||||||||||||||||||||||||||||||||||||||
Restructuring costs (2) | — | 5,196 | — | 5,196 | |||||||||||||||||||||||||||||||||||||||||||
Gain on sale of assets, net (3) | (582) | (493) | (933) | (6,226) | |||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 219,460 | $ | 208,038 | 11,422 | 5.5 | $ | 590,331 | $ | 525,055 | 65,276 | 12.4 | |||||||||||||||||||||||||||||||||||
| Revenues | $ | 916,270 | $ | 840,427 | 75,843 | $ | 2,556,539 | $ | 2,319,192 | 237,347 | |||||||||||||||||||||||||||||||||||||
| EBITDA margin | 24.0 | % | 24.1 | % | 23.1 | % | 22.6 | % | |||||||||||||||||||||||||||||||||||||||
| Incremental EBITDA margin | 23.4 | % | 27.9 | % | |||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA margin | 24.0 | % | 24.8 | % | 23.1 | % | 22.6 | % | |||||||||||||||||||||||||||||||||||||||
| Adjusted incremental EBITDA margin | 15.1 | % | 27.5 | % | |||||||||||||||||||||||||||||||||||||||||||
| Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow and Free Cash Flow Conversion | |||||||||||||||||||||||||||||||||||||||||||||||
| Net cash provided by operating activities | $ | 146,947 | $ | 127,355 | $ | 419,495 | $ | 375,541 | |||||||||||||||||||||||||||||||||||||||
| Capital expenditures | (7,522) | (6,868) | (23,389) | (21,279) | |||||||||||||||||||||||||||||||||||||||||||
| Free cash flow | $ | 139,425 | $ | 120,487 | 18,938 | 15.7 | $ | 396,106 | $ | 354,262 | 41,844 | 11.8 | |||||||||||||||||||||||||||||||||||
| Free cash flow conversion | 101.8 | % | 94.3 | % | 109.8 | % | 108.6 | % | |||||||||||||||||||||||||||||||||||||||
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(1) Consists of expenses resulting from the amortization of certain intangible assets and adjustments to the fair value of contingent consideration resulting from the acquisition of Fox. While we exclude such expenses in this non-GAAP measure, the revenue from the acquired company is reflected in this non-GAAP measure and the acquired assets contribute to revenue generation.
(2) Restructuring costs consist of costs primarily related to severance and benefits paid to employees pursuant to restructuring and workforce reduction plans.
(3) Consists of the gain or loss on the sale of non-operational assets.
(4) The tax effect of the adjustments is calculated using the applicable statutory tax rates for the respective periods.
(5) In some cases, the sum of the individual EPS amounts may not equal total non-GAAP EPS calculations due to rounding.
(6) In the first quarter of 2024, we revised the non-GAAP metrics adjusted net income, adjusted EPS, and adjusted EBITDA to exclude gains and losses related to non-operational asset sales. These measures are of operating performance and we believe excluding the gains and losses on non-operational assets allows us to better compare our operating performance consistently over various periods. Refer to our first quarter 2024 press release for fully revised quarterly metrics.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Variance | Variance | ||||||||||||||||||||||||||||||||||||||||||||||
| 2024 | 2023 (7) | $ | % | 2024 | 2023 (7) | $ | % | ||||||||||||||||||||||||||||||||||||||||
| Reconciliation of Revenues to Organic Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Revenues | $ | 916,270 | $ | 840,427 | 75,843 | 9.0 | $ | 2,556,539 | $ | 2,319,192 | 237,347 | 10.2 | |||||||||||||||||||||||||||||||||||
| Revenues from acquisitions | (17,339) | — | (17,339) | 2.1 | (77,479) | — | (77,479) | 3.3 | |||||||||||||||||||||||||||||||||||||||
| Revenues of divestitures | — | (5,823) | 5,823 | (0.8) | — | (16,500) | 16,500 | (0.8) | |||||||||||||||||||||||||||||||||||||||
| Organic revenues | $ | 898,931 | $ | 834,604 | 64,327 | 7.7 | $ | 2,479,060 | $ | 2,302,692 | 176,368 | 7.7 | |||||||||||||||||||||||||||||||||||
| Reconciliation of Residential Revenues to Organic Residential Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Residential revenues | $ | 428,290 | $ | 402,559 | 25,731 | 6.4 | $ | 1,166,042 | $ | 1,069,403 | 96,639 | 9.0 | |||||||||||||||||||||||||||||||||||
| Residential revenues from acquisitions | (9,571) | — | (9,571) | 2.4 | (54,257) | — | (54,257) | 5.1 | |||||||||||||||||||||||||||||||||||||||
| Residential revenues of divestitures | — | (3,263) | 3,263 | (0.9) | — | (9,668) | 9,668 | (1.0) | |||||||||||||||||||||||||||||||||||||||
| Residential organic revenues | $ | 418,719 | $ | 399,296 | 19,423 | 4.9 | $ | 1,111,785 | $ | 1,059,735 | 52,050 | 4.9 | |||||||||||||||||||||||||||||||||||
| Reconciliation of Commercial Revenues to Organic Commercial Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Commercial revenues | $ | 299,633 | $ | 273,865 | 25,768 | 9.4 | $ | 845,517 | $ | 767,472 | 78,045 | 10.2 | |||||||||||||||||||||||||||||||||||
| Commercial revenues from acquisitions | (6,434) | — | (6,434) | 2.3 | (17,456) | — | (17,456) | 2.3 | |||||||||||||||||||||||||||||||||||||||
| Commercial revenues of divestitures | — | (2,560) | 2,560 | (1.0) | — | (6,832) | 6,832 | (1.0) | |||||||||||||||||||||||||||||||||||||||
| Commercial organic revenues | $ | 293,199 | $ | 271,305 | 21,894 | 8.1 | $ | 828,061 | $ | 760,640 | 67,421 | 8.9 | |||||||||||||||||||||||||||||||||||
| Reconciliation of Termite and Ancillary Revenues to Organic Termite and Ancillary Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Termite and ancillary revenues | $ | 177,674 | $ | 155,135 | 22,539 | 14.5 | $ | 515,758 | $ | 457,664 | 58,094 | 12.7 | |||||||||||||||||||||||||||||||||||
| Termite and ancillary revenues from acquisitions | (1,334) | — | (1,334) | 0.8 | (5,766) | — | (5,766) | 1.3 | |||||||||||||||||||||||||||||||||||||||
| Termite and ancillary organic revenues | $ | 176,340 | $ | 155,135 | 21,205 | 13.7 | $ | 509,992 | $ | 457,664 | 52,328 | 11.4 | |||||||||||||||||||||||||||||||||||
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| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Variance | Variance | ||||||||||||||||||||||||||||||||||||||||||||||
2023 (7) | 2022 (7) | $ | % | 2023 (7) | 2022 (7) | $ | % | ||||||||||||||||||||||||||||||||||||||||
| Reconciliation of Revenues to Organic Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Revenues | $ | 840,427 | $ | 729,704 | 110,723 | 15.2 | $ | 2,319,192 | $ | 2,034,433 | 284,759 | 14.0 | |||||||||||||||||||||||||||||||||||
| Revenues from acquisitions | (49,971) | — | (49,971) | 6.8 | (114,273) | — | (114,273) | 5.6 | |||||||||||||||||||||||||||||||||||||||
| Organic revenues | $ | 790,456 | $ | 729,704 | 60,752 | 8.4 | $ | 2,204,919 | $ | 2,034,433 | 170,486 | 8.4 | |||||||||||||||||||||||||||||||||||
| Reconciliation of Residential Revenues to Organic Residential Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Residential revenues | $ | 402,559 | $ | 336,626 | 65,933 | 19.6 | $ | 1,069,403 | $ | 917,790 | 151,613 | 16.5 | |||||||||||||||||||||||||||||||||||
| Residential revenues from acquisitions | (42,974) | — | (42,974) | 12.8 | (91,067) | — | (91,067) | 9.9 | |||||||||||||||||||||||||||||||||||||||
| Residential organic revenues | $ | 359,585 | $ | 336,626 | 22,959 | 6.8 | $ | 978,336 | $ | 917,790 | 60,546 | 6.6 | |||||||||||||||||||||||||||||||||||
| Reconciliation of Commercial Revenues to Organic Commercial Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Commercial revenues | $ | 273,865 | $ | 245,009 | 28,856 | 11.8 | $ | 767,472 | $ | 688,523 | 78,949 | 11.5 | |||||||||||||||||||||||||||||||||||
| Commercial revenues from acquisitions | (3,456) | — | (3,456) | 1.4 | (10,688) | — | (10,688) | 1.6 | |||||||||||||||||||||||||||||||||||||||
| Commercial organic revenues | $ | 270,409 | $ | 245,009 | 25,400 | 10.4 | $ | 756,784 | $ | 688,523 | 68,261 | 9.9 | |||||||||||||||||||||||||||||||||||
| Reconciliation of Termite and Ancillary Revenues to Organic Termite and Ancillary Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Termite and ancillary revenues | $ | 155,135 | $ | 139,359 | 15,776 | 11.3 | $ | 457,664 | $ | 405,089 | 52,575 | 13.0 | |||||||||||||||||||||||||||||||||||
| Termite and ancillary revenues from acquisitions | (3,541) | — | (3,541) | 2.5 | (12,518) | — | (12,518) | 3.1 | |||||||||||||||||||||||||||||||||||||||
| Termite and ancillary organic revenues | $ | 151,594 | $ | 139,359 | 12,235 | 8.8 | $ | 445,146 | $ | 405,089 | 40,057 | 9.9 | |||||||||||||||||||||||||||||||||||
(7) Revenues classified by significant product and service offerings for the three and nine months ended September 30, 2023 and 2022 were misstated by an immaterial amount and have been restated from the amounts previously reported to correct the classification of such revenues. There was no impact on our condensed consolidated statements of income, financial position, or cash flows.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Reconciliation of SG&A to Adjusted SG&A | |||||||||||||||||||||||
| SG&A | $ | 274,918 | $ | 244,906 | $ | 769,522 | $ | 696,668 | |||||||||||||||
Fox acquisition-related expenses (1) | — | 1,050 | 1,049 | 2,097 | |||||||||||||||||||
| Adjusted SG&A | $ | 274,918 | $ | 243,856 | $ | 768,473 | $ | 694,571 | |||||||||||||||
| Revenues | $ | 916,270 | $ | 840,427 | $ | 2,556,539 | $ | 2,319,192 | |||||||||||||||
| Adjusted SG&A as a % of revenues | 30.0 | % | 29.0 | % | 30.1 | % | 29.9 | % | |||||||||||||||
Period Ended September 30, 2024 | Period Ended December 31, 2023 | ||||||||||
| Reconciliation of Long-term Debt to Net Debt and Net Leverage Ratio | |||||||||||
Long-term debt (8) | $ | 447,000 | $ | 493,000 | |||||||
| Less: cash | 95,282 | 103,825 | |||||||||
| Net debt | $ | 351,718 | $ | 389,175 | |||||||
| Trailing twelve-month EBITDA | $ | 771,291 | $ | 705,064 | |||||||
| Net leverage ratio | 0.5x | 0.6x | |||||||||
(8) As of September 30, 2024, the Company had outstanding borrowings of $447.0 million under the Credit Facility. Borrowings under the Credit Facility are presented under the long-term debt caption of our condensed consolidated balance sheet, net of $1.8 million in unamortized debt issuance costs as of September 30, 2024.
9