ServiceMaster Reports 2016 Q3 Results

http://investors.servicemaster.com/press-release/company/servicemaster-global-holdings%C2%A0inc-reports-third-quarter-2016-financial-results


MEMPHIS, Tenn. — ServiceMaster Global Holdings, Inc., a leading provider of essential residential and commercial services, today announced unaudited third-quarter 2016 results. The company reported a year-over-year revenue increase of 7 percent driven primarily by organic growth at American Home Shield (“AHS”), the impacts of acquiring Alterra Pest Control, LLC (“Alterra”) in November 2015 and OneGuard Home Warranties (“OneGuard”) in June 2016 and 2 percent organic revenue growth at Terminix, primarily driven by improved pricing.

Third-quarter 2016 net income was $70 million, or $0.51 per share, versus $49 million, or $0.36 per share, in the same period in 2015. Third-quarter 2015 pre-tax net income includes a $31 million loss on extinguishment of debt.

Third-quarter 2016 adjusted net income was $81 million, or $0.59 per share, versus $74 million, or $0.54 per share, for the same period in 2015.

Third-quarter 2016 Adjusted EBITDA was $192 million, a year-over-year increase of $18 million, or 10 percent, primarily driven by increases in Adjusted EBITDA of $10 million, $5 million and $1 million at Terminix, AHS and the Franchise Services Group, respectively. As previously reported, AHS was negatively impacted in the third-quarter 2016 by a $5 million increase in claims costs associated with a higher number of HVAC work orders driven by record high temperatures.

Rob Gillette, ServiceMaster’s chief executive officer, noted: “ServiceMaster delivered strong top and bottom line growth this quarter. Terminix continues to benefit from acquisitions and organic growth and AHS, despite headwinds associated with record high temperatures, had another solid quarter. Going forward, as we position Terminix for accelerated growth, we are committed to making the investment and operational changes that will lead to higher customer satisfaction, retention and shareholder value.”

TERMINIX. Terminix reported a 6 percent year-over-year revenue increase in the third-quarter of 2016, driven primarily by the impact of the Alterra acquisition in November 2015 and organic growth, primarily driven by improved pricing. Adjusted EBITDA increased 12 percent, or $10 million, versus prior year, primarily driven by $10 million from the conversion of higher revenue and $3 million in other cost reductions, offset, in part, by a $3 million increase in technology costs.