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ABM Industries (ABM) Q2 Earnings Beat, Revenues Lag, Up Y/Y
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ABM Industries Inc.(ABM - Free Report) reported mixed second-quarter fiscal 2022 results, with earnings beating the Zacks Consensus Estimate while revenues lagging the same.
Adjusted earnings from continuing operations came in at 89 cents per share, beating the consensus mark by 6% and increasing 8.5% year over year. The bottom line benefited from increased operating earnings on higher revenues and the benefits of one less work day. These were, however, partially offset by the impact of a decline in the volume of higher-margin virus protection services and work orders, as well as higher costs.
Total revenues of $1.89 billion missed the consensus estimate by 1% while improving 26.7% from the year-ago level. The upside was backed by solid demand across the company’s Business & Industry, Aviation, Manufacturing & Distribution, and Technical Solutions segments, especially in its eMobility business. Quarterly revenue growth includes 7.5% organic growth and 19.2% from acquisitions.
Quarterly results benefited from contributions from acquisitions, solid demand for the company’s core janitorial services, and continued recovery in the aviation industry. These were, however, partially offset by the expected decline in disinfection-related work orders and EnhancedClean services.
So far this year, shares of ABM Industries have gained 20.6% compared with 4.3% surge of the industry it belongs to.
Image Source: Zacks Investment Research
Let’s check out the numbers.
Segment-Wise Revenues
Business & Industry revenues increased 48.9% year over year to $1.00 billion. Manufacturing & Distribution revenues inched up 4.9% year over year to $356.9 million. Aviation revenues increased 27.4% year over year to $185.9 million. Technical Solutions revenues increased 18.1% year over year to $147 million.
Education revenues of $204.4 million, however, decreased 3.9% from the prior-year quarter.
Operating Results
Adjusted EBITDA came in at $118.9 million compared with $106.6 million in the year-ago quarter. Adjusted EBITDA margin was 6.5% compared with 7.4% in the year-ago quarter.
Operating expenses increased 29.3% from the year-ago figure to $1.65 billion. Selling, general and administrative expenses declined 3.1% from the year-ago level to $156.8 million.
ABM Industries Incorporated Price, Consensus and EPS Surprise
ABM Industries exited second-quarter fiscal 2022 with cash and cash equivalents of $48.9 million compared with $46.6 million at the end of the prior quarter. Long-term debt was $986.6 million compared with $971.9 million at the end of the prior quarter.
Net cash used in operating activities totaled $43.9 million for the reported quarter. Free cash flow came in at $53.9 million.
Dividend Payout & Share Repurchase
ABM Industries’ board of directors declared a quarterly cash dividend of 19.5 cents per share. The dividend will be paid on Aug 1, 2022 to stockholders of record as of Jul 7, 2022. This marked the 225th consecutive quarterly cash dividend by the company.
During the reported quarter, the company repurchased 0.7 million shares at an average price of $43.5, for a total cost of $30 million.
Fiscal 2022 Guidance
For fiscal 2022, ABM Industries reaffirmed its guidance for adjusted income from continuing operations, which is expected to be in the range of $3.50-$3.70 per share. The Zacks Consensus Estimate for the metric of $3.61 lies within the guidance.
Equifax’s adjusted earnings of $2.22 per share beat the Zacks Consensus Estimate by 3.3% and improved 13% on a year-over-year basis. The reported figure exceeded the guided range of $2.08-$2.18.
Equifax’s revenues of $1.36 billion outpaced the consensus estimate by 2.4% and improved 12.4% year over year on a reported basis and 13% on a local-currency basis. The reported figure exceeded the guided range of $1.32-$1.34 billion.
Waste Management (WM - Free Report) reported solid first-quarter 2022 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Waste Management’s adjusted earnings per share of $1.29 beat the Zacks Consensus Estimate by 15.2% and improved 21.7% year over year.
Waste Management’s total revenues of $4.66 billion beat the consensus estimate by 4.6% and increased 13.4% year over year.
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ABM Industries (ABM) Q2 Earnings Beat, Revenues Lag, Up Y/Y
ABM Industries Inc.(ABM - Free Report) reported mixed second-quarter fiscal 2022 results, with earnings beating the Zacks Consensus Estimate while revenues lagging the same.
Adjusted earnings from continuing operations came in at 89 cents per share, beating the consensus mark by 6% and increasing 8.5% year over year. The bottom line benefited from increased operating earnings on higher revenues and the benefits of one less work day. These were, however, partially offset by the impact of a decline in the volume of higher-margin virus protection services and work orders, as well as higher costs.
Total revenues of $1.89 billion missed the consensus estimate by 1% while improving 26.7% from the year-ago level. The upside was backed by solid demand across the company’s Business & Industry, Aviation, Manufacturing & Distribution, and Technical Solutions segments, especially in its eMobility business. Quarterly revenue growth includes 7.5% organic growth and 19.2% from acquisitions.
Quarterly results benefited from contributions from acquisitions, solid demand for the company’s core janitorial services, and continued recovery in the aviation industry. These were, however, partially offset by the expected decline in disinfection-related work orders and EnhancedClean services.
So far this year, shares of ABM Industries have gained 20.6% compared with 4.3% surge of the industry it belongs to.
Image Source: Zacks Investment Research
Let’s check out the numbers.
Segment-Wise Revenues
Business & Industry revenues increased 48.9% year over year to $1.00 billion. Manufacturing & Distribution revenues inched up 4.9% year over year to $356.9 million. Aviation revenues increased 27.4% year over year to $185.9 million. Technical Solutions revenues increased 18.1% year over year to $147 million.
Education revenues of $204.4 million, however, decreased 3.9% from the prior-year quarter.
Operating Results
Adjusted EBITDA came in at $118.9 million compared with $106.6 million in the year-ago quarter. Adjusted EBITDA margin was 6.5% compared with 7.4% in the year-ago quarter.
Operating expenses increased 29.3% from the year-ago figure to $1.65 billion. Selling, general and administrative expenses declined 3.1% from the year-ago level to $156.8 million.
ABM Industries Incorporated Price, Consensus and EPS Surprise
ABM Industries Incorporated price-consensus-eps-surprise-chart | ABM Industries Incorporated Quote
Balance Sheet & Cash Flow
ABM Industries exited second-quarter fiscal 2022 with cash and cash equivalents of $48.9 million compared with $46.6 million at the end of the prior quarter. Long-term debt was $986.6 million compared with $971.9 million at the end of the prior quarter.
Net cash used in operating activities totaled $43.9 million for the reported quarter. Free cash flow came in at $53.9 million.
Dividend Payout & Share Repurchase
ABM Industries’ board of directors declared a quarterly cash dividend of 19.5 cents per share. The dividend will be paid on Aug 1, 2022 to stockholders of record as of Jul 7, 2022. This marked the 225th consecutive quarterly cash dividend by the company.
During the reported quarter, the company repurchased 0.7 million shares at an average price of $43.5, for a total cost of $30 million.
Fiscal 2022 Guidance
For fiscal 2022, ABM Industries reaffirmed its guidance for adjusted income from continuing operations, which is expected to be in the range of $3.50-$3.70 per share. The Zacks Consensus Estimate for the metric of $3.61 lies within the guidance.
Currently, ABM Industries carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Business Services Companies
Omnicom Group (OMC - Free Report) reported impressive first-quarter 2022 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Omnicom’s earnings of $1.39 per share beat the consensus mark by 8.6% and increased 4.5% year over year, driven by strong margin performance.
Omnicom’s total revenues of $3.4 billion surpassed the consensus estimate by 5.4% but declined slightly year over year.
Equifax (EFX - Free Report) reported better-than-expected first-quarter 2022 results.
Equifax’s adjusted earnings of $2.22 per share beat the Zacks Consensus Estimate by 3.3% and improved 13% on a year-over-year basis. The reported figure exceeded the guided range of $2.08-$2.18.
Equifax’s revenues of $1.36 billion outpaced the consensus estimate by 2.4% and improved 12.4% year over year on a reported basis and 13% on a local-currency basis. The reported figure exceeded the guided range of $1.32-$1.34 billion.
Waste Management (WM - Free Report) reported solid first-quarter 2022 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Waste Management’s adjusted earnings per share of $1.29 beat the Zacks Consensus Estimate by 15.2% and improved 21.7% year over year.
Waste Management’s total revenues of $4.66 billion beat the consensus estimate by 4.6% and increased 13.4% year over year.