Exhibit 99.1

 

For Further Information Contact

Eddie Northen (404) 888-2242

 

 

FOR IMMEDIATE RELEASE

 

ROLLINS, INC. REPORTS FOURTH QUARTER AND FULL-YEAR 2019

FINANCIAL RESULTS

 

·Revenue increased 13.8% for the quarter, eclipsing annual record revenues of $2 billion on Net Income of $50.8 million

 

·Earnings Per Share (EPS) $0.16 for fourth quarter, flat to fourth quarter 2018 primarily impacted by increases in Casualty reserves of $0.01

 

·Fourth quarter earnings before interest, taxes, depreciation and amortization (EBITDA)* of $97 million, 10.5% increase for the quarter

 

·Completed successful pilot of new Routing and Scheduling program in fourth quarter

 

ATLANTA, GEORGIA, January 29, 2020:

Rollins, Inc. (NYSE:ROL), a premier global consumer and commercial services company, reported strong unaudited financial results for its fourth quarter and year ended December 31, 2019.

 

The Company recorded fourth quarter revenues of $506.0 million, an increase of 13.8% over the prior year’s fourth quarter revenue of $444.6 million. Rollins reported net income of $50.8 million or $0.16 per diluted share in the fourth quarter that ended December 31, 2019, compared to $51.0 million or $0.16 per diluted share for the same period in 2018.

 

For the full-year ended December 31, 2019, Rollins’ revenues rose 10.6% to $2.015 billion compared to $1.822 billion for the prior year. The Company reported net income of $203.3 million, or $0.62 per diluted share in 2019, compared to net income of $231.7 million, or $0.71 per diluted share in the prior year. Net income was negatively impacted in 2019 by a $49.9 million one-time expense for discontinuing the pension plan, $2.7 million in acquisition expenses related to Clark Pest Control, and foreign currency exchange rate fluctuations. Rollins’ adjusted earnings per share (EPS)* removing these costs increases 2019 full year Adjusted EPS* by $0.11 to $0.73 per diluted share compared to 2018 Adjusted EPS* of $0.72 per diluted share.

 

*“Adjusted” amounts presented in this release are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics, including a reconciliation to the most closely correlated GAAP measure.

 

 

 

Eddie Northen, Senior Vice President, Chief Financial Officer and Treasurer of Rollins, Inc. stated, “We continue to invest in innovative technology as well as seeking out strong acquisitions that fit well into the Rollins family of brands. As a result of these investments, we have experienced record amounts of amortization and depreciation that will deliver positive results for years to come.”

 

Gary W. Rollins, Vice Chairman and Chief Executive Officer of Rollins, Inc. stated, “The Company is well-positioned for 2020, and our team is optimistic and feels that we have plans and programs in place to achieve our desired results. As we move into a new decade, we are committed to continued improvement on all key elements of our business, for the benefit of our customers, employees and shareholders.”

 

On January 28, 2020, Rollins increased its regular quarterly cash dividend to shareholders 14.3% to $0.12 per share. This marks the 18th consecutive year the Board has increased its dividend a minimum of 12.0% or more.

 

Rollins, Inc. is a premier global consumer and commercial services company. Through its wholly owned subsidiaries, Orkin, HomeTeam Pest Defense, Clark Pest Control, Orkin Canada, Western Pest Services, Northwest Exterminating, Critter Control, The Industrial Fumigant Company, Trutech, Orkin Australia, Waltham Pest Services, OPC Pest Services, PermaTreat, Crane Pest Control, Safeguard, and Aardwolf Pestkare, the Company provides essential pest control services and protection against termite damage, rodents and insects to more than two million customers in the United States, Canada, Central America, South America, the Caribbean, the Middle East, Asia, the Mediterranean, Europe, Africa, Mexico, and Australia from more than 700 locations. You can learn more about Rollins and its subsidiaries by visiting our web sites at www.orkin.com, www.pestdefense.com, www.clarkpest.com, www.orkincanada.ca, www.westernpest.com, www.callnorthwest.com, www.crittercontrol.com, www.indfumco.com, www.trutechinc.com, www.orkinau.com, www.walthamservices.com, www.opcpest.com, www.permatreat.com, www.safeguardpestcontrol.co.uk, www.aardwolfpestkare.com, www.cranepestcontrol.com and www.rollins.com. You can also find this and other news releases at www.rollins.com by accessing the news releases button.

 

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

 

This release contains statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements about the continued investment in innovative technology as well as seeking strong acquisitions; the expectation that we will deliver positive results for years to come, and the Company’s belief that it is well-positioned for 2020 and has the team and plan to achieve its desired results. The actual results of the Company could differ materially from those indicated by the forward-looking statements because of various risks and uncertainties, including without limitation, economic and competitive conditions which may adversely affect the Company’s business; the degree of success of the Company’s pest and termite process, and pest control selling and treatment methods; the Company’s ability to identify and integrate potential acquisitions; climate and weather trends; competitive factors and pricing practices; the Company’s ability to attract and retain skilled workers, and potential increases in labor costs; uncertainties of litigation; changes in various government laws and regulations, including environmental regulations; and the impact of the U. S. Government shutdown. All of the foregoing risks and uncertainties are beyond the ability of the Company to control, and in many cases the Company cannot predict the risks and uncertainties that could cause its actual results to differ materially from those indicated by the forward-looking statements. A more detailed discussion of potential risks facing the Company can be found in the Company’s Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2018.

 

*“Adjusted” amounts presented in this release are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics, including a reconciliation to the most closely correlated GAAP measure.

 

 

 

ROLLINS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(in thousands)

 

At December 31, (unaudited)  2019  2018
ASSETS          
Cash and cash equivalents  $94,276   $115,485 
Trade accounts receivables, net   122,766    104,016 
Financed receivables, net   22,267    18,454 
Materials and supplies   19,476    15,788 
Other current assets   48,198    32,278 
Total Current Assets   306,983    286,021 
Equipment and property, net   195,533    136,885 
Goodwill   572,847    368,481 
Customer contracts, net   273,720    178,075 
Trademarks and tradenames, net   102,539    54,140 
Other intangible assets, net   10,525    11,043 
Operating lease, right-of-use assets   200,727    —   
Financed receivables, long-term, net   30,792    28,227 
Benefit plan assets   21,565    —   
Prepaid pension   —      5,274 
Deferred income tax assets   —      6,915 
Other assets   24,161    19,063 
Total Assets  $1,739,392   $1,094,124 
LIABILITIES          
Accounts payable  $35,234   $27,168 
Accrued insurance, current   30,441    27,709 
Accrued compensation and related liabilities   81,943    77,741 
Unearned revenue   122,825    116,005 
Operating lease liabilities, current   66,117    —   
Current portion of long-term debt   12,500    —   
Other current liabilities   59,682    50,406 
Total Current Liabilities   408,742    299,029 
Accrued insurance, less current portion   34,920    33,867 
Operating lease liabilities, less current portion   135,651    —   
Long-term debt   279,000    —   
Deferred income tax liabilities   7,747    —   
Long-term accrued liabilities   57,582    49,320 
Total Liabilities   923,642    382,216 
STOCKHOLDERS’ EQUITY          
Common stock   327,431    327,308 
Retained earnings and other equity   488,319    384,600 
Total stockholders’ equity   815,750    711,908 
Total Liabilities and Stockholders’ Equity  $1,739,392   $1,094,124 

 

*“Adjusted” amounts presented in this release are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics, including a reconciliation to the most closely correlated GAAP measure.

 

 

 

ROLLINS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands except per share data)

(unaudited)

 

   Three Months Ended  Twelve Months Ended
   December 31,  December 31,
   2019  2018  2019  2018
REVENUES            
Customer services  $505,985   $444,624   $2,015,477   $1,821,565 
COSTS AND EXPENSES                    
Cost of services provided   254,284    221,235    993,593    894,437 
Depreciation and amortization   22,606    16,644    81,111    66,792 
Pension settlement loss   —      —      49,898    —   
Sales, general and administrative   154,796    135,760    623,379    550,698 
Gain on sale of assets, net   (175)   (197)   (581)   (875)
Interest expense/(income), net   2,465    (290)   6,917    (220)
    433,976    373,152    1,754,317    1,510,832 
INCOME BEFORE INCOME TAXES   72,009    71,472    261,160    310,733 
PROVISION FOR INCOME TAXES   21,244    20,504    57,813    79,070 
NET INCOME  $50,765   $50,968   $203,347   $231,663 
NET INCOME PER SHARE - BASIC AND DILUTED  $0.16   $0.16   $0.62   $0.71 
Weighted average shares outstanding - basic and diluted   327,439    327,316    327,477    327,291 

 

*“Adjusted” amounts presented in this release are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics, including a reconciliation to the most closely correlated GAAP measure.

 

 

 

APPENDIX

 

Reconciliation of GAAP and non-GAAP Financial Measures

 

The Company has used the non-GAAP financial measures of adjusted net income and adjusted EPS in today’s earnings release. This measure should not be considered in isolation or as a substitute for net income or other performance measures prepared in accordance with GAAP.

 

The Company uses adjusted net income and adjusted EPS as a measure of operating performance because it allows us to compare performance consistently over various periods without regard to the impact of the non-recurring pension settlement loss, large acquisition expenses, related to the acquisition of Clark Pest Control, and fluctuations in foreign currency valuations. International acquisition activity has increased along with the overall stronger US dollar.

 

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 adjusted net income and adjusted EPS with net income, the most comparable GAAP measures.

 

(unaudited in thousands except EPS)

 

   Three Months Ended  Twelve Months Ended
   December 31  December 31
   2019  2018  Better/ (Worse)  %  2019  2018  Better/ (Worse)  %
Net Income  $50,765   $50,968   $(203)   (0.4)  $203,347   $231,663   $(28,316)   (12.2)
Pension Settlement Loss   —      —      —      —      49,898    —      49,898     N/M  
Clark Pest Control acquisition expense   —      —      —      —      2,704    —      2,704     N/M  
Foreign Currency Exchange   2,172    2,030    142    7.0    8,933    6,997    1,936    27.7 
Adjusted Income Taxes on Excluded Expenses   (587)   (545)   (42)   (7.7)   (26,477)   (1,914)   (24,563)    N/M  
Adjusted Net Income  $52,350   $52,453   $(103)   (0.2)  $238,405   $236,746   $1,659    0.7 
Adjusted Net Income Per Share - Basic And Diluted  $0.16   $0.16   $—      —     $0.73   $0.72   $0.01    1.4 
Weighted average participating shares outstanding - basic and diluted   327,439    327,316    (123)   —      327,477    327,291    (186)   (0.1)

 

*“Adjusted” amounts presented in this release are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics, including a reconciliation to the most closely correlated GAAP measure.

 

 

 

Rollins, Inc. has used the non-GAAP financial measure of earnings before interest, taxes, depreciation and amortization (EBITDA) in today’s earnings release, and anticipates using EBITDA in today’s earnings conference call. EBITDA should not be considered in isolation or as a substitute for operating income, net income or other performance measures prepared in accordance with U.S. GAAP. Rollins, Inc. uses EBITDA as a measure of operating performance because it allows us to compare performance consistently over various periods without regard to changes in our capital structure.

 

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 EBITDA with Net Income, the most comparable GAAP measure.

 

(in thousands except per share data)

 

   Three Months Ended  Twelve Months Ended
   December 31,  December 31,
   2019  2018  2019  2018
Net Income  $50,765   $50,968   $203,347   $231,663 
Add:                    
Income tax provision   21,244    20,504    57,813    79,070 
Interest (income)/expense, net   2,465    (290)   6,917    (220)
Depreciation and amortization   22,606    16,644    81,111    66,792 
EBITDA  $97,080   $87,826   $349,188   $377,305 

 

*“Adjusted” amounts presented in this release are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics, including a reconciliation to the most closely correlated GAAP measure.

 

 

 

 

(( CONFERENCE CALL ANNOUNCEMENT ((

Rollins, Inc.

(NYSE: ROL)

 

 

 

Management will hold a conference call to discuss

Fourth Quarter 2019 results on

 

Wednesday, January 29, 2020 at:

10:00 a.m. Eastern

9:00 a.m. Central

8:00 a.m. Mountain

7:00 a.m. Pacific

 

TO PARTICIPATE:

Please dial 800-353-6461 domestic;

334-323-0501 international
at least 5 minutes before start time.

 

REPLAY: available through February 5, 2020

Please dial 888-203-1112/719-457-0820, Passcode 1421446

THIS CALL CAN ALSO BE ACCESSED THROUGH THE INTERNET AT

www.rollins.com

 

Questions?

Contact Samantha Alphonso at Financial Relations Board at 212-827-3746

Or email to salphonso@mww.com

 

*“Adjusted” amounts presented in this release are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics, including a reconciliation to the most closely correlated GAAP measure.

 

 


The following information was filed by Rollins Inc (ROL) on Wednesday, January 29, 2020 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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