ABM Industries Incorporated (ABM - Free Report) reported impressive first-quarter fiscal 2024 results, wherein earnings per share (EPS) and revenues beat the Zacks Consensus Estimate.
ABM’s EPS (excluding 16 cents from non-recurring items) was 86 cents per share, which surpassed the Zacks Consensus Estimate by 19.4% and increased 8.9% from the prior-year quarter. Total revenues of $2.1 billion beat the consensus mark by 2.9% and improved 3.9% from first-quarter fiscal 2023.
The company’s shares have gained 10.9% in the past six months, underperforming the 21.8% rally of the industry it belongs to.
Segmental Revenues
Revenues from the Manufacturing & Distribution segment rose 5.4% to $400.9 million, beating our estimate of $381.9 million. The uptick was due to increasing demand and an efficient sales strategy.
The Aviation segment’s revenues increased 17.5% from the prior-year quarter to $249.5 million and surpassed our estimate of $229 million. The metric was driven primarily by strong demand for business travel and leisure.
Technical Solutions increased 12.9% from first-quarter fiscal 2023 to $165.9 million. The metric beat our anticipation of $149.2 million. The uptick in Technical Solutions revenues was driven by the completion of multiple battery energy storage projects.
The Education segment’s revenues increased 2.4% from the prior-year quarter to $220.1 million, surpassing our estimate of $216.1 million. The increase in this segment’s revenues resulted from an improved labor market that reduced overtime expenses.
The Business & Industry segment’s revenues decreased marginally from the prior-year quarter to $1.03 billion and met our estimate. The marginal decline in revenues was due to the slow-paced business activities of the commercial real estate market.
Profitability Performance
Adjusted EBITDA was $116.7 million, down 4.9% from the year-ago quarter. The adjusted EBITDA margin was 5.6%, down 60 basis points from first-quarter fiscal 2023.
Balance Sheet & Cash Flow
ABM Industries exited first-quarter fiscal 2024 with cash and cash equivalents of $58 million compared with $69.5 million at the end of the prior quarter. Long-term debt (net) was $1.3 billion compared with $1.28 billion at the end of the prior quarter. Net cash utilized by operating activities was $139.2 million for the quarter. The free cash flow utilized was $4.3 million.
2024 Guidance
For fiscal 2024, ABM Industries expects adjusted EPS of $3.30-$3.45. The Zacks Consensus Estimate for EPS of $3.3 is pegged below the mid-point ($3.38) of the company’s guided range. The adjusted EBITDA margin is anticipated between 6.2% and 6.5%. Interest expenses are expected between $82 million and $86 million.
ABM currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot of Peers
Stericycle, Inc. (SRCL - Free Report) reported mixed fourth-quarter 2023 results.
SRCL’s quarterly EPS (excluding 38 cents from non-recurring items) came in at 54 cents, which surpassed the consensus estimate by 14.9% but declined 10% on a year-over-year basis. Revenues of $652 million missed the consensus mark marginally and dipped 2.7% year over year.
Republic Services, Inc. (RSG - Free Report) reported impressive fourth-quarter 2023 results.
RSG’s earnings per share (EPS), excluding 2 cents from non-recurring items, of $1.41 beat the Zacks Consensus Estimate by 10.2% and increased 24.8% year over year. Revenues of $3.8 billion surpassed the consensus mark by 2.9% and increased 8.6% year over year.
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ABM Industries Incorporated (ABM - Free Report) reported impressive first-quarter fiscal 2024 results, wherein earnings per share (EPS) and revenues beat the Zacks Consensus Estimate.
ABM’s EPS (excluding 16 cents from non-recurring items) was 86 cents per share, which surpassed the Zacks Consensus Estimate by 19.4% and increased 8.9% from the prior-year quarter. Total revenues of $2.1 billion beat the consensus mark by 2.9% and improved 3.9% from first-quarter fiscal 2023.
The company’s shares have gained 10.9% in the past six months, underperforming the 21.8% rally of the industry it belongs to.
Segmental Revenues
Revenues from the Manufacturing & Distribution segment rose 5.4% to $400.9 million, beating our estimate of $381.9 million. The uptick was due to increasing demand and an efficient sales strategy.
The Aviation segment’s revenues increased 17.5% from the prior-year quarter to $249.5 million and surpassed our estimate of $229 million. The metric was driven primarily by strong demand for business travel and leisure.
Technical Solutions increased 12.9% from first-quarter fiscal 2023 to $165.9 million. The metric beat our anticipation of $149.2 million. The uptick in Technical Solutions revenues was driven by the completion of multiple battery energy storage projects.
The Education segment’s revenues increased 2.4% from the prior-year quarter to $220.1 million, surpassing our estimate of $216.1 million. The increase in this segment’s revenues resulted from an improved labor market that reduced overtime expenses.
The Business & Industry segment’s revenues decreased marginally from the prior-year quarter to $1.03 billion and met our estimate. The marginal decline in revenues was due to the slow-paced business activities of the commercial real estate market.
Profitability Performance
Adjusted EBITDA was $116.7 million, down 4.9% from the year-ago quarter. The adjusted EBITDA margin was 5.6%, down 60 basis points from first-quarter fiscal 2023.
Balance Sheet & Cash Flow
ABM Industries exited first-quarter fiscal 2024 with cash and cash equivalents of $58 million compared with $69.5 million at the end of the prior quarter. Long-term debt (net) was $1.3 billion compared with $1.28 billion at the end of the prior quarter. Net cash utilized by operating activities was $139.2 million for the quarter. The free cash flow utilized was $4.3 million.
2024 Guidance
For fiscal 2024, ABM Industries expects adjusted EPS of $3.30-$3.45. The Zacks Consensus Estimate for EPS of $3.3 is pegged below the mid-point ($3.38) of the company’s guided range. The adjusted EBITDA margin is anticipated between 6.2% and 6.5%. Interest expenses are expected between $82 million and $86 million.
ABM currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot of Peers
Stericycle, Inc. (SRCL - Free Report) reported mixed fourth-quarter 2023 results.
SRCL’s quarterly EPS (excluding 38 cents from non-recurring items) came in at 54 cents, which surpassed the consensus estimate by 14.9% but declined 10% on a year-over-year basis. Revenues of $652 million missed the consensus mark marginally and dipped 2.7% year over year.
Republic Services, Inc. (RSG - Free Report) reported impressive fourth-quarter 2023 results.
RSG’s earnings per share (EPS), excluding 2 cents from non-recurring items, of $1.41 beat the Zacks Consensus Estimate by 10.2% and increased 24.8% year over year. Revenues of $3.8 billion surpassed the consensus mark by 2.9% and increased 8.6% year over year.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 5 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How To Profit From Trillions On Spending For Infrastructure >>
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