ABM Enjoys Record Revenues in Third Quarter

NEW YORK – With robust earnings per share growth, ABM, a provider of facility solutions, posted record revenues in the third quarter, crediting “strong operational and financial performance.

The company recorded a third quarter profit of $49.7 million, or 84 cents a share, on sales of $2.3 billion, compared to $41.8 million, or 67 cents, on sales of $2.2 billion in the same period last year.

"Our third quarter results reflected strong operational and financial performance, including record quarterly revenue, robust EPS growth and substantial cash generation," said Scott Salmirs, president and CEO. “Our team executed well and delivered on our expectations despite a backdrop of macro uncertainty and adverse timing of certain projects."

Aviation and Manufacturing & Distribution ("M&D") delivered strong organic revenue growth, with M&D benefiting from healthy technology markets and further supported by the recent WGNstar acquisition.
Technical Solutions’ revenue growth was impacted by some project deferrals, while Business & Industry ("B&I") revenue performance was largely as anticipated.

The company expects to ramp sequentially in the fourth quarter as it executes on many deferred projects.

"Disciplined working capital management drove exceptional year-to-date free cash flow, which in turn accelerated our deleveraging ahead of schedule,” said Salmirs. “We also secured a $300 million accounts receivable facility at favorable rates, further strengthening our capital structure. And our focus on cost discipline resulted in a $3 million reduction in ongoing corporate costs versus the prior year. Together, these actions contributed to our third quarter results and helped keep us on track to deliver on our full-year outlook, as well as provide longer-term benefits."

Revenue increased 4.2% year over year to a record of $2.3 billion, including 2.1% organic growth and 2.1% growth from acquisitions. Aviation’s growth reflected healthy air travel trends and the continued ramp of the recently won London Heathrow contract.

The increase in net income primarily reflects higher segment operating profit, lower tax expense and reduced ongoing corporate costs, partially offset by higher interest expense related to the WGNstar acquisition

Third quarter net cash provided by operating activities was $146.8 million, and free cash flow was $128.4 million, compared to $175.0 million and $150.2 million, respectively, in the prior year period.

At the end of the third quarter, the Company’s total indebtedness stood at $1.8 billion, including $22.4 million in standby letters of credit, resulting in a total leverage ratio of 2.9x, as defined by the Company's revolving credit facility.

Available liquidity was $605.8 million, including $110.5 million in cash and cash equivalents. The Company expects to further reduce its total leverage ratio by fiscal year-end.

The Company's full year organic revenue growth outlook remains unchanged, with performance expected near the top end of the 3% to 4% range, and total revenue growth continues to be expected toward the top end of the 4% to 5% range.

The company has assets of $5.6 billion, and liabilities of $3.8 billion.

For more information, visit www.abm.com.