Servicemaster Global Holdings Inc (SERV) SEC Filing 10-K Annual report for the fiscal year ending Tuesday, December 31, 2019

Earnings Press Release
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Servicemaster Global Holdings Inc
Ticker: SERV CIK: 1428875

Exhibit 99.1

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Jesse Jenkins

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Jesse.Jenkins@servicemaster.com

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James Robinson

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ServiceMaster Delivers Full-Year 2019 Revenue Growth of 9 Percent

Terminix revenue increased 9 percent year-over-year, including 2.6 percent organically

Terminix retention, cancel rates, and net promoter score improved across all revenue channels(#)

Terminix completes analysis of potential termite damage claims exposure

Terminix announces $10 million investment to accelerate termite damage claims mitigation program

Full-year 2020 continuing operations guidance (excluding ServiceMaster Brands):

Revenue is expected between $1,980 and $2,000 million, growth of 9 to 10 percent

Terminix organic revenue growth is expected between 3 and 4 percent

Adjusted EBITDA is expected between $320 and $335 million

MEMPHIS, TENN. — February 27, 2020 —

ServiceMaster Global Holdings, Inc. (NYSE: SERV), a leading provider of essential services to residential and commercial customers in the termite, pest control, cleaning and restoration markets, today announced unaudited full-year and fourth-quarter 2019 results.

For the full year 2019, the Company reported a year-over-year revenue increase of nine percent to $2,077 million with net income of $128 million, or $0.94 per share. Adjusted EBITDA(1) for the year was $417 million. Adjusted net income(2) improved 41 percent in 2019 to $184 million, or $1.35 per share, versus $130 million, or $0.95 per share in the 2018.

For the quarter ended December 31, 2019, the Company reported a year-over-year revenue increase of 11 percent to $507 million with a net loss of $26 million, or $0.19 per share. Net income was negatively impacted by an increase in our reserves of $40 million, net of tax, for termite damage claims expense for Litigated(3) and Non-Litigated(4) Claims in the quarter. Adjusted EBITDA for the quarter of $80 million was approximately flat with prior year. Adjusted net income improved 12 percent to $30 million, or $0.22 per share.

“Both the Terminix and ServiceMaster Brands segments delivered strong progress against our 2019 strategic initiatives,” said ServiceMaster Chairman and interim CEO Naren Gursahaney. “As we announced in January, we are conducting a strategic review of our ServiceMaster Brands business, including a possible sale of the business. This decision reflects our emphasis on driving long-term shareholder value.”

“At Terminix, solid full-year gains in net promoter scores and retention led to 2.6 percent organic revenue growth, meeting increased guidance estimates. We are continuing our progress transforming the Terminix business, and improved prioritization and alignment across the business on our key strategic priorities will drive continued retention improvements and margin expansion in 2020. We remain laser-focused on the termite business, including the execution of our termite damage claims mitigation program that will better protect our customers and manage our risks. I am encouraged by our progress and remain convinced we are on the right path towards delivering sustainable, profitable growth at or above industry levels.”

As further described in the “Termite Damage Claims” section below, the Company has completed a detailed statistical analysis of historical termite damage claims activity and potential future exposure. Between 2020 and 2024 the Company expects total termite damage claims expense of approximately $230 million, compared to actual expense of $230 million incurred between 2015 and 2019.

The following information was filed by Servicemaster Global Holdings Inc (SERV) on Thursday, February 27, 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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