Strong Revenue Growth Drives Double-Digit Increase in Earnings and Cash Flow
ATLANTA, April 23, 2025 /PRNewswire/ -- Rollins, Inc. (NYSE:ROL) ("Rollins" or the "Company"), a premier global consumer and commercial services company, reported unaudited financial results for the first quarter of 2025.
Key Highlights
- First quarter revenues were $823 million, an increase of 9.9% over the first quarter of 2024 with organic revenues* increasing 7.4%. The stronger dollar versus foreign currencies in countries where we operate reduced revenues by 40 basis points during the quarter.
- Quarterly operating income was $143 million, an increase of 7.7% over the first quarter of 2024. Quarterly operating margin was 17.3%, a decrease of 40 basis points versus the first quarter of 2024. Adjusted operating income* was $147 million, an increase of 6.7% over the prior year. Adjusted operating income margin* was 17.9%, a decrease of 50 basis points compared to the prior year.
- Adjusted EBITDA* was $172 million, an increase of 6.9% over the prior year. Adjusted EBITDA margin* was 20.9%, a decrease of 60 basis points versus the first quarter of 2024.
- Quarterly net income was $105 million, an increase of 11.5% over the prior year. Adjusted net income* was $108 million, an increase of 9.7% over the prior year.
- Quarterly EPS was $0.22 per diluted share, a 15.8% increase over the prior year EPS of $0.19. Adjusted EPS* was $0.22 per diluted share, an increase of 10.0% over the prior year.
- Operating cash flow was $147 million for the quarter, an increase of 15.3% compared to the prior year. The Company invested $27 million in acquisitions, $7 million in capital expenditures, and paid dividends totaling $80 million.
*Amounts are non-GAAP financial measures. See the schedules below for a discussion of non-GAAP financial metrics including a reconciliation of the most directly comparable GAAP measure.
Management Commentary
"Our results for the first quarter reflect our resilient business model and our teammates' ongoing focus on operational excellence," said Jerry Gahlhoff, Jr., President and CEO. "We continue to invest in our business by focusing on organic demand generation activities, while also strengthening the breadth and depth of the Rollins portfolio through strategic M&A like the Saela acquisition we made in April. We are thrilled to welcome our Saela teammates to the Rollins family and look forward to the positive contributions they will bring to our business," Mr. Gahlhoff added.
"It was encouraging to see such a strong start to the year as the team delivered solid revenue growth, double-digit earnings growth, and a 15 percent increase in operating cash flow for the quarter," said Kenneth Krause, Executive Vice President and CFO. "Our investments in growth continue to yield results, as organic growth of 7.4 percent was at the midpoint of our range despite one less business day in the quarter. Our markets remain healthy and we are well-positioned to continue delivering strong results through our robust business model," Mr. Krause concluded.
Three Months Ended Financial Highlights
Three Months Ended March 31, | ||||||
Variance | ||||||
(unaudited, in thousands, except per share data and margins) | 2025 | 2024 | $ | % | ||
GAAP Metrics | ||||||
Revenues | $ 822,504 | $ 748,349 | $ 74,155 | 9.9 % | ||
Gross profit (1) | $ 422,370 | $ 382,791 | $ 39,579 | 10.3 % | ||
Gross profit margin (1) | 51.4 % | 51.2 % | 20 bps | |||
Operating income | $ 142,648 | $ 132,424 | $ 10,224 | 7.7 % | ||
Operating income margin | 17.3 % | 17.7 % | (40) bps | |||
Net income | $ 105,248 | $ 94,394 | $ 10,854 | 11.5 % | ||
EPS | $ 0.22 | $ 0.19 | $ 0.03 | 15.8 % | ||
Net cash provided by operating activities | $ 146,892 | $ 127,433 | $ 19,459 | 15.3 % | ||
Non-GAAP Metrics | ||||||
Adjusted operating income (2) | $ 146,861 | $ 137,689 | $ 9,172 | 6.7 % | ||
Adjusted operating margin (2) | 17.9 % | 18.4 % | (50) bps | |||
Adjusted net income (2) | $ 107,868 | $ 98,357 | $ 9,511 | 9.7 % | ||
Adjusted EPS (2) | $ 0.22 | $ 0.20 | $ 0.02 | 10.0 % | ||
Adjusted EBITDA (2) | $ 171,857 | $ 160,783 | $ 11,074 | 6.9 % | ||
Adjusted EBITDA margin (2) | 20.9 % | 21.5 % | (60) bps | |||
Free cash flow (2) | $ 140,111 | $ 120,262 | $ 19,849 | 16.5 % | ||
(1) Exclusive of depreciation and amortization |
(2) Amounts are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics including a reconciliation of the most directly comparable GAAP measure. |
The following table presents financial information, including our significant expense categories, for the three months ended March 31, 2025 and 2024:
Three Months Ended March 31, | ||||
(unaudited, in thousands) | 2025 | 2024 | ||
$ | % of | $ | % of | |
Revenue | $ 822,504 | 100.0 % | $ 748,349 | 100.0 % |
Less: | ||||
Cost of services provided (exclusive of depreciation and amortization below): | ||||
Employee expenses | 261,724 | 31.8 % | 238,529 | 31.9 % |
Materials and supplies | 48,491 | 5.9 % | 44,786 | 6.0 % |
Insurance and claims | 16,524 | 2.0 % | 17,644 | 2.4 % |
Fleet expenses | 36,857 | 4.5 % | 30,697 | 4.1 % |
Other cost of services provided (1) | 36,538 | 4.4 % | 33,902 | 4.5 % |
Total cost of services provided (exclusive of depreciation and amortization below) | 400,134 | 48.6 % | 365,558 | 48.8 % |
Sales, general and administrative: | ||||
Selling and marketing expenses | 98,250 | 11.9 % | 82,911 | 11.1 % |
Administrative employee expenses | 81,481 | 9.9 % | 75,778 | 10.1 % |
Insurance and claims | 10,004 | 1.2 % | 10,526 | 1.4 % |
Fleet expenses | 9,403 | 1.1 % | 7,765 | 1.0 % |
Other sales, general and administrative (2) | 51,375 | 6.2 % | 46,077 | 6.2 % |
Total sales, general and administrative | 250,513 | 30.5 % | 223,057 | 29.8 % |
Depreciation and amortization | 29,209 | 3.6 % | 27,310 | 3.6 % |
Interest expense, net | 5,796 | 0.7 % | 7,725 | 1.0 % |
Other expense (income), net | (692) | (0.1) % | 61 | - % |
Income tax expense | 32,296 | 3.9 % | 30,244 | 4.0 % |
Net income | $ 105,248 | 12.8 % | $ 94,394 | 12.6 % |
1) Other cost of services provided includes facilities costs, professional services, maintenance & repairs, software license costs, and other expenses directly related to providing services. |
2) Other sales, general and administrative includes facilities costs, professional services, maintenance & repairs, software license costs, bad debt expense, and other administrative expenses. |
About Rollins, Inc.:
Rollins, Inc. (ROL) is a premier global consumer and commercial services company. Through its family of leading brands, the Company and its franchises provide essential pest control services and protection against termite damage, rodents, and insects to more than 2.8 million customers in North America, South America, Europe, Asia, Africa, and Australia, with more than 20,000 employees from more than 800 locations. Rollins is parent to Aardwolf Pestkare, Clark Pest Control, Crane Pest Control, Critter Control, Fox Pest Control, HomeTeam Pest Defense, Industrial Fumigant Company, McCall Service, MissQuito, Northwest Exterminating, OPC Pest Services, Orkin, Orkin Australia, Orkin Canada, PermaTreat, Safeguard, Saela Pest Control, Trutech, Waltham Services, Western Pest Services, and more. You can learn more about Rollins and its subsidiaries by visiting www.rollins.com.
Cautionary Statement Regarding Forward-Looking Statements
This press release as well as other written or oral statements by the Company may contain "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our current opinions, expectations, intentions, beliefs, plans, objectives, assumptions and projections about future events and financial trends affecting the operating results and financial condition of our business. Although we believe that these forward-looking statements are reasonable, we cannot assure you that we will achieve or realize these plans, intentions, or expectations. Generally, statements that do not relate to historical facts, including statements concerning possible or assumed future actions, business strategies, events or results of operations, are forward-looking statements. The words "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "possible," "potential," "predict," "should," "will," "would," and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this press release include, but are not limited to, statements regarding: expectations with respect to our financial and business performance; demand for our services; expected growth; our resilient business model; our focus on operational excellence; investments in our business by focusing on organic demand generation activities and strategic M&A; positive contributions Saela will bring to our business; healthy markets; and being well-positioned to continue delivering strong results through our robust business model.
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, 2024 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, April 24, 2025 at 8:30 a.m. Eastern Time to discuss the first quarter 2025 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 13752677. For interested individuals unable to join the call, a replay will be available on the website for 180 days.
ROLLINS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (in thousands) (unaudited) | |||
March 31, | December 31, | ||
ASSETS | |||
Cash and cash equivalents | $ 201,177 | $ 89,630 | |
Trade receivables, net | 194,105 | 196,081 | |
Financed receivables, short-term, net | 38,898 | 40,301 | |
Materials and supplies | 41,249 | 39,531 | |
Other current assets | 80,542 | 77,080 | |
Total current assets | 555,971 | 442,623 | |
Equipment and property, net | 123,754 | 124,839 | |
Goodwill | 1,178,704 | 1,161,085 | |
Intangibles, net | 534,813 | 541,589 | |
Operating lease right-of-use assets | 422,683 | 414,474 | |
Financed receivables, long-term, net | 91,843 | 89,932 | |
Other assets | 40,790 | 45,153 | |
Total assets | $ 2,948,558 | $ 2,819,695 | |
LIABILITIES | |||
Accounts payable | $ 53,075 | $ 49,625 | |
Accrued insurance - current | 44,981 | 54,840 | |
Accrued compensation and related liabilities | 88,898 | 122,869 | |
Unearned revenues | 191,162 | 180,851 | |
Operating lease liabilities - current | 127,456 | 121,319 | |
Other current liabilities | 131,247 | 115,658 | |
Total current liabilities | 636,819 | 645,162 | |
Accrued insurance, less current portion | 70,551 | 61,946 | |
Operating lease liabilities, less current portion | 298,126 | 295,899 | |
Long-term debt | 485,451 | 395,310 | |
Other long-term accrued liabilities | 101,859 | 90,785 | |
Total liabilities | 1,592,806 | 1,489,102 | |
STOCKHOLDERS' EQUITY | |||
Common stock | 484,619 | 484,372 | |
Retained earnings and other equity | 871,133 | 846,221 | |
Total stockholders' equity | 1,355,752 | 1,330,593 | |
Total liabilities and stockholders' equity | $ 2,948,558 | $ 2,819,695 | |
ROLLINS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in thousands except per share data) (unaudited) | |||
Three Months Ended March 31, | |||
2025 | 2024 | ||
REVENUES | |||
Customer services | $ 822,504 | $ 748,349 | |
COSTS AND EXPENSES | |||
Cost of services provided (exclusive of depreciation and amortization below) | 400,134 | 365,558 | |
Sales, general and administrative | 250,513 | 223,057 | |
Depreciation and amortization | 29,209 | 27,310 | |
Total operating expenses | 679,856 | 615,925 | |
OPERATING INCOME | 142,648 | 132,424 | |
Interest expense, net | 5,796 | 7,725 | |
Other (income) expense, net | (692) | 61 | |
CONSOLIDATED INCOME BEFORE INCOME TAXES | 137,544 | 124,638 | |
PROVISION FOR INCOME TAXES | 32,296 | 30,244 | |
NET INCOME | $ 105,248 | $ 94,394 | |
NET INCOME PER SHARE - BASIC AND DILUTED | $ 0.22 | $ 0.19 | |
Weighted average shares outstanding - basic | 484,414 | 484,131 | |
Weighted average shares outstanding - diluted | 484,434 | 484,318 | |
DIVIDENDS PAID PER SHARE | $ 0.165 | $ 0.150 | |
ROLLINS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED CASH FLOW INFORMATION (in thousands) (unaudited) | |||
Three Months Ended March 31, | |||
2025 | 2024 | ||
OPERATING ACTIVITIES | |||
Net income | $ 105,248 | $ 94,394 | |
Depreciation and amortization | 29,209 | 27,310 | |
Change in working capital and other operating activities | 12,435 | 5,729 | |
Net cash provided by operating activities | 146,892 | 127,433 | |
INVESTING ACTIVITIES | |||
Acquisitions, net of cash acquired | (27,191) | (47,132) | |
Capital expenditures | (6,781) | (7,171) | |
Other investing activities, net | 1,405 | 1,838 | |
Net cash used in investing activities | (32,567) | (52,465) | |
FINANCING ACTIVITIES | |||
Net borrowings | 95,215 | 20,000 | |
Payment of dividends | (79,910) | (72,589) | |
Other financing activities, net | (19,917) | (11,665) | |
Net cash used in financing activities | (4,612) | (64,254) | |
Effect of exchange rate changes on cash and cash equivalents | 1,834 | (1,568) | |
Net increase in cash and cash equivalents | $ 111,547 | $ 9,146 | |
APPENDIX
Reconciliation of GAAP and non-GAAP Financial Measures
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.
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 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.
The Company has used the following non-GAAP financial measures in this earnings release:
Organic revenues
Organic revenues are calculated as revenues less the revenues from acquisitions completed within the prior 12 months and excluding the revenues from divested businesses. Acquisition revenues are based on the trailing 12-month revenue of our acquired entities. Management uses organic revenues, and organic revenues by type to compare revenues over various periods excluding the impact of acquisitions and divestitures.
Adjusted operating income and adjusted operating margin
Adjusted operating income and adjusted operating margin are calculated by adding back to net income those expenses resulting from the amortization of certain intangible assets, adjustments to the fair value of contingent consideration resulting from the acquisition of Fox Pest Control, and restructuring costs related to restructuring and workforce reduction plans. Adjusted operating margin is calculated as adjusted operating income divided by revenues. Management uses adjusted operating income and adjusted operating margin as measures of operating performance because these measures allow the Company to compare performance consistently over various periods.
Adjusted net income and adjusted EPS
Adjusted net income and adjusted EPS are calculated by adding back to the GAAP measures amortization of certain intangible assets, adjustments to the fair value of contingent consideration resulting from the acquisition of Fox Pest Control, and restructuring costs related to restructuring and workforce reduction plans, and excluding gains and losses on the sale of non-operational assets and gains on the sale of businesses, and by further subtracting the tax impact of those expenses, gains, or losses. Management uses adjusted net income and adjusted EPS as measures of operating performance because these measures allow the Company to compare performance consistently over various periods.
EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, incremental EBITDA margin and adjusted incremental EBITDA margin
EBITDA is calculated by adding back to net income depreciation and amortization, interest expense, net, and provision for income taxes. EBITDA margin is calculated as EBITDA divided by revenues. Adjusted EBITDA and adjusted EBITDA margin are calculated by further adding back those expenses resulting from the adjustments to the fair value of contingent consideration resulting from the acquisition of Fox Pest Control, restructuring costs related to restructuring and workforce reduction plans, and excluding gains and losses on the sale of non-operational assets and gains on the sale of businesses. Management uses EBITDA, EBITDA margin, adjusted EBITDA and adjusted EBITDA margin as measures of operating performance because these measures allow the Company to compare performance consistently over various periods. Incremental EBITDA margin is calculated as the change in EBITDA divided by the change in revenue. Management uses incremental EBITDA margin as a measure of operating performance because this measure allows the Company to compare performance consistently over various periods. Adjusted incremental EBITDA margin is calculated as the change in adjusted EBITDA divided by the change in revenue. Management uses adjusted incremental EBITDA margin as a measure of operating performance because this measure allows the Company to compare performance consistently over various periods.
Free cash flow and free cash flow conversion
Free cash flow is calculated by subtracting capital expenditures from cash provided by operating activities. Management uses free cash flow to demonstrate the Company's ability to maintain its asset base and generate future cash flows from operations. Free cash flow conversion is calculated as free cash flow divided by net income. Management uses free cash flow conversion to demonstrate how much net income is converted into cash. Management believes that free cash flow is an important financial measure for use in evaluating the Company's liquidity. Free cash flow should be considered in addition to, rather than as a substitute for, net cash provided by operating activities as a measure of our liquidity. Additionally, the Company's definition of free cash flow is limited, in that it does not represent residual cash flows available for discretionary expenditures, due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations or payments made for business acquisitions. Therefore, management believes it is important to view free cash flow as a measure that provides supplemental information to our consolidated statements of cash flows.
Adjusted sales, general and administrative ("SG&A")
Adjusted SG&A is calculated by removing the adjustments to the fair value of contingent consideration resulting from the acquisition of Fox Pest Control. Management uses adjusted SG&A to compare SG&A expenses consistently over various periods.
Leverage ratio
Leverage ratio, a financial valuation measure, is calculated by dividing adjusted net debt by adjusted EBITDAR. Adjusted net debt is calculated by adding operating lease liabilities to total long-term debt less a cash adjustment of 90% of cash and cash equivalents. Adjusted EBITDAR is calculated by adding back to net income depreciation and amortization, interest expense, net, provision for income taxes, operating lease cost, and stock-based compensation expense. Management uses leverage ratio as an assessment of overall liquidity, financial flexibility, and leverage.
Set forth below is a reconciliation of the non-GAAP financial measures contained in this release with their most directly comparable GAAP measures.
(unaudited, in thousands, except per share data and margins) | |||||||
Three Months Ended March 31, | |||||||
Variance | |||||||
2025 | 2024 | $ | % | ||||
Reconciliation of Revenues to Organic Revenues | |||||||
Revenues | $ 822,504 | $ 748,349 | 74,155 | 9.9 | |||
Revenues from acquisitions | (18,550) | - | (18,550) | 2.5 | |||
Organic revenues | $ 803,954 | $ 748,349 | 55,605 | 7.4 | |||
Reconciliation of Residential Revenues to Organic Residential Revenues | |||||||
Residential revenues | $ 356,313 | $ 329,338 | 26,975 | 8.2 | |||
Residential revenues from acquisitions | (8,366) | - | (8,366) | 2.5 | |||
Residential organic revenues | $ 347,947 | $ 329,338 | 18,609 | 5.7 | |||
Reconciliation of Commercial Revenues to Organic Commercial Revenues | |||||||
Commercial revenues | $ 284,357 | $ 258,114 | 26,243 | 10.2 | |||
Commercial revenues from acquisitions | (7,032) | - | (7,032) | 2.8 | |||
Commercial organic revenues | $ 277,325 | $ 258,114 | 19,211 | 7.4 | |||
Reconciliation of Termite and Ancillary Revenues to Organic Termite and Ancillary Revenues | |||||||
Termite and ancillary revenues | $ 172,130 | $ 152,060 | 20,070 | 13.2 | |||
Termite and ancillary revenues from acquisitions | (3,152) | - | (3,152) | 2.1 | |||
Termite and ancillary organic revenues | $ 168,978 | $ 152,060 | 16,918 | 11.1 | |||
Three Months Ended March 31, | |||||||
Variance | |||||||
2025 | 2024 | $ | % | ||||
Reconciliation of Operating Income and Operating Income Margin to Adjusted Operating Income and Adjusted Operating Income | |||||||
Operating income | $ 142,648 | $ 132,424 | |||||
Fox acquisition-related expenses (1) | 4,213 | 5,265 | |||||
Adjusted operating income | $ 146,861 | $ 137,689 | 9,172 | 6.7 | |||
Revenues | $ 822,504 | $ 748,349 | |||||
Operating income margin | 17.3 % | 17.7 % | |||||
Adjusted operating margin | 17.9 % | 18.4 % | |||||
Reconciliation of Net Income and EPS to Adjusted Net Income and Adjusted EPS | |||||||
Net income | $ 105,248 | $ 94,394 | |||||
Fox acquisition-related expenses (1) | 4,213 | 5,265 | |||||
Gain on sale of assets, net (2) | (692) | 61 | |||||
Tax impact of adjustments (3) | (901) | (1,363) | |||||
Adjusted net income | $ 107,868 | $ 98,357 | 9,511 | 9.7 | |||
EPS - basic and diluted | $ 0.22 | $ 0.19 | |||||
Fox acquisition-related expenses (1) | 0.01 | 0.01 | |||||
Gain on sale of assets, net (2) | - | - | |||||
Tax impact of adjustments (3) | - | - | |||||
Adjusted EPS - basic and diluted (4) | $ 0.22 | $ 0.20 | 0.02 | 10.0 | |||
Weighted average shares outstanding - basic | 484,414 | 484,131 | |||||
Weighted average shares outstanding - diluted | 484,434 | 484,318 | |||||
Reconciliation of Net Income to EBITDA, Adjusted EBITDA, EBITDA Margin, Incremental EBITDA Margin, Adjusted EBITDA | |||||||
Net income | $ 105,248 | $ 94,394 | |||||
Depreciation and amortization | 29,209 | 27,310 | |||||
Interest expense, net | 5,796 | 7,725 | |||||
Provision for income taxes | 32,296 | 30,244 | |||||
EBITDA | $ 172,549 | $ 159,673 | 12,876 | 8.1 | |||
Fox acquisition-related expenses (1) | - | 1,049 | |||||
Gain on sale of assets, net (2) | (692) | 61 | |||||
Adjusted EBITDA | $ 171,857 | $ 160,783 | 11,074 | 6.9 | |||
Revenues | $ 822,504 | $ 748,349 | 74,155 | ||||
EBITDA margin | 21.0 % | 21.3 % | |||||
Incremental EBITDA margin | 17.4 % | ||||||
Adjusted EBITDA margin | 20.9 % | 21.5 % | |||||
Adjusted incremental EBITDA margin | 14.9 % | ||||||
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow and Free Cash Flow Conversion | |||||||
Net cash provided by operating activities | $ 146,892 | $ 127,433 | |||||
Capital expenditures | (6,781) | (7,171) | |||||
Free cash flow | $ 140,111 | $ 120,262 | 19,849 | 16.5 | |||
Free cash flow conversion | 133.1 % | 127.4 % | |||||
Three Months Ended March 31, | |||
2025 | 2024 | ||
Reconciliation of SG&A to Adjusted SG&A | |||
SG&A | $ 250,513 | $ 223,057 | |
Fox acquisition-related expenses (1) | - | 1,049 | |
Adjusted SG&A | $ 250,513 | $ 222,008 | |
Revenues | $ 822,504 | $ 748,349 | |
Adjusted SG&A as a % of revenues | 30.5 % | 29.7 % | |
Period Ended | Period Ended | ||
Reconciliation of Long-term Debt and Net Income to Leverage Ratio | |||
Long-term debt (5) | $ 500,000 | $ 397,000 | |
Operating lease liabilities (6) | 425,582 | 417,218 | |
Cash adjustment (7) | (181,059) | (80,667) | |
Adjusted net debt | $ 744,523 | $ 733,551 | |
Net income | $ 477,233 | $ 466,379 | |
Depreciation and amortization | 115,119 | 113,220 | |
Interest expense, net | 25,748 | 27,677 | |
Provision for income taxes | 165,903 | 163,851 | |
Operating lease cost (8) | 141,057 | 133,420 | |
Stock-based compensation expense | 31,602 | 29,984 | |
Adjusted EBITDAR | $ 956,662 | $ 934,531 | |
Leverage ratio | 0.8x | 0.8x | |
(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 Pest Control. 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) Consists of the gain or loss on the sale of non-operational assets. |
(3) The tax effect of the adjustments is calculated using the applicable statutory tax rates for the respective periods. |
(4) In some cases, the sum of the individual EPS amounts may not equal total non-GAAP EPS calculations due to rounding. |
(5) As of March 31, 2025, the Company had outstanding borrowings of $500.0 million from the issuance of our 2035 Senior Notes and no outstanding borrowings under the Credit Facility. The Company's borrowings are presented under the long-term debt caption of our condensed consolidated balance sheet, net of a $7.6 million unamortized discount and $6.9 million in unamortized debt issuance costs as of March 31, 2025. |
(6) Operating lease liabilities are presented under the operating lease liabilities - current and operating lease liabilities, less current portion captions of our consolidated balance sheet. |
(7) Represents 90% of cash and cash equivalents per our consolidated balance sheet as of both periods presented. |
(8) Operating lease cost excludes short-term lease cost associated with leases that have a duration of 12 months or less. |
For Further Information Contact
Lyndsey Burton (404) 888-2348
SOURCE Rollins, Inc.
