Rollins, Inc. Reports Positive First Quarter Financial Results
ATLANTA--(BUSINESS WIRE)--
Rollins, Inc. (NYSE:ROL), a premier North American consumer and commercial services company, today reported unaudited financial results for the first quarter ended March 31, 2008. Revenues grew 4.4% to $210.1 million compared to $201.2 million for the first quarter ended March 31, 2007.
The Company recorded net income of $13.8 million or $0.14 per diluted share for the first quarter ended March 31, 2008, compared to $12.8 million or $0.13 per diluted share for the first quarter ended March 31, 2007.
On January 23, 2008, Rollins, Inc. approved a 25% increase in the Company's regular quarterly cash dividend to $0.0625. Also in the first quarter, the Company announced that it repurchased 236,000 shares of common stock at a weighted average price of $17.09 per share. In total, approximately 778,000 additional shares may be purchased under previous authorization by the Board of Directors.
Commenting on the Company's results, Gary W. Rollins, President and Chief Executive Officer of Rollins, Inc. said, "We were pleased with our revenue improvement in the first quarter. Commercial sales, which significantly increased in the fourth quarter, continued to be strong in our first quarter. This quarter is not a high volume quarter for Residential Pest Control and Termite Control due to the small amount of pest activity. As the weather warms, these businesses will gain momentum.
"On April 3, 2008, we completed the acquisition of HomeTeam Pest Defense, a subsidiary of Centex Corporation (NYSE:CTX) for a cash payment of approximately $137 million. HomeTeam recorded pest control revenues of $134 million for the twelve months completed March 31, 2007. HomeTeam has 50 offices in 13 states, is the nation's third largest residential pest management company and performs services for approximately 400,000 customers coast to coast. This acquisition provides significant opportunity for Rollins to leverage HomeTeam's proprietary technology and new home marketing expertise to more markets throughout the U.S. The purchase of HomeTeam will provide us with an entry into a new business channel, and provide our company a meaningful opportunity for longer term growth. We look forward to working with this great team of professionals, and will benefit from their talent and experience."
Rollins, Inc. is a premier North American consumer and commercial services company. Through its wholly owned subsidiaries, Orkin, Inc., PCO Services, Rollins HomeTeam, Western Pest Services, and The Industrial Fumigant Company, the Company provides essential pest control services and protection against termite damage, rodents and insects to approximately 2.1 million customers in the United States, Canada, Mexico, Central America, the Caribbean, the Middle East and Asia from over 500 locations. You can learn more about our subsidiaries by visiting our Web sites at www.orkin.com, www.pestdefense.com, www.westernpest.com, www.indfumco.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 the Company's belief that its residential pest control and termite control businesses will gain momentum as the weather warms; the acquisition of HomeTeam Pest Defense provides significant opportunity for the Company to leverage HomeTeam's proprietary technology and new home marketing expertise to more markets throughout the U.S.; the purchase of HomeTeam will provide the Company with an entry into a new business channel and provide the Company a meaningful opportunity for longer term growth; and the Company will benefit from the talent and experience of the HomeTeam Pest Defense team of professionals. 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, general economic conditions; market risk; changes in industry practices or technologies; the degree of success of the Company's pest and termite process reforms 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; expected benefits of the commercial re-engineering project may not be realized; potential increases in labor costs; uncertainties of litigation; and changes in various government laws and regulations, including environmental regulations. 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, 2007.
ROLLINS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(in thousands)
2008 2007
At March 31, (unaudited) (unaudited)
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ASSETS
Cash and cash equivalents $ 71,365 $ 54,994
Trade receivables, short-term 53,908 50,711
Materials and supplies 8,715 8,691
Deferred income taxes 17,901 19,603
Other current assets 9,115 9,971
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Total Current Assets 161,004 143,970
Equipment and property, net 76,823 76,850
Goodwill 126,296 125,230
Other Intangible Assets 9,176 9,195
Customer Contracts 60,843 65,950
Deferred income taxes 7,676 12,956
Trade receivables, long-term 8,918 8,519
Prepaid Pension 17,169 -
Other assets 6,828 5,514
----------- -----------
Total Assets $474,733 $448,184
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LIABILITIES
Capital leases $ 798 $ 1,183
Accounts payable 18,562 15,827
Accrued insurance 14,235 13,978
Accrued compensation and related liabilities 33,048 33,189
Other current liabilities 32,553 35,889
Unearned revenue 85,253 83,674
----------- -----------
Total Current Liabilities 184,449 183,740
Capital leases, less current portion 757 939
Accrued pension - 6,946
Long-term accrued liabilities 52,979 51,694
----------- -----------
Total Liabilities 238,185 243,319
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STOCKHOLDERS' EQUITY
Common stock 100,913 101,919
Retained earnings and other equity 135,635 102,946
----------- -----------
Total Stockholders' Equity 236,548 204,865
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Total Liabilities and Stockholders' Equity $474,733 $448,184
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ROLLINS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE FIRST QUARTER ENDED MARCH 31,
(in thousands except per share data)
(unaudited)
Three Months ended
March 31,
-------------------
2008 2007
--------- ---------
REVENUES
Customer services $210,078 $201,232
COSTS AND EXPENSES
Cost of services provided 110,359 106,836
Depreciation and amortization 6,631 6,686
Sales, general and administrative 70,760 67,041
Gain on sales of assets (21) (7)
Interest income (397) (552)
--------- ---------
187,332 180,004
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INCOME BEFORE TAXES 22,746 21,228
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PROVISION FOR INCOME TAXES 8,907 8,435
--------- ---------
NET INCOME $ 13,839 $ 12,793
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NET INCOME PER SHARE - BASIC $ 0.14 $ 0.13
========= =========
NET INCOME PER SHARE - DILUTED $ 0.14 $ 0.13
========= =========
Weighted average shares outstanding - basic 99,388 100,982
Weighted average shares outstanding - Diluted 100,401 103,094
CONFERENCE CALL ANNOUNCEMENT
Rollins, Inc.
(NYSE: ROL)
Management will hold a conference call to discuss
First Quarter results on:
Wednesday, April 23, 2008 at:
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10:00 a.m. Eastern
9:00 a.m. Central
8:00 a.m. Mountain
7:00 a.m. Pacific
TO PARTICIPATE:
Please dial 800-366-3908 domestic;
303-262-2130 international
at least 5 minutes before start time.
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REPLAY: available through April 30, 2008
Please dial 800-405-2236/303-590-3000, Pass code: 11112420
THIS CALL CAN ALSO BE ACCESSED THROUGH THE INTERNET AT
www.viavid.net
Questions?
Contact Janet Jazmin at Financial Relations Board at 212-827-3777
Or email to jjazmin@frbir.com
Source: Rollins, Inc.
Released April 23, 2008