ABM Industries (ABM) 13 Dec 232023 Q4 Earnings call transcript

Greetings, and welcome to the ABM Industries Fourth Quarter 2023 Earnings Conference Call.

[Operator Instructions]

Please note, this conference is being recorded. I will now turn the conference over to your host, Paul Goldberg, Head of Investor Relations for ABM. Thank you.

begin. may You

me and our Call. everyone, the ABM's Quarter Financial Officer; ABM. Fourth Vice President Salmirs, Good Chief Officer. Vice and name welcome President is Earnings Executive With at Relations My of Earl I'm are Paul XXXX Scott President our Ellis, morning, and Investor to today Executive Goldberg Senior Chief and and

results. release A that our this and of be year morning, announcing press our will we earlier our full can fourth prepared the note Earl's an Please XXXX website, and Q&A issued financial copy Varilease presentation Scott accompanying session. and quarter we remarks, host bn.com. slide After on found

presentation today predictions, other we statements. and begin, contains would forward-looking before remind I and you to estimates But call like that our

the words our they and expect holds. estimate, these expressions what future and represent identify to are the use Our of intended statements, current of judgment similar

them risks accompanies These with believe described we as differ SEC. to materially. the are factors these that statements our as well actual presentation to the our that slide uncertainties While cause in and subject results reasonable, to our are be filings inherently could

the call of turn of tab. measures the to will financial certain Scott. call, presented. A Investor And the presentation GAAP like be of end with to I'd the company's reconciliation course non-GAAP under is the the historical During website to this numbers at that, non-GAAP information financial over available on and

billion, by organic All in you in our fourth activity quarter led of Aviation revenue double-digit Thanks, organically new to the grew addition quarter airport all the joining clients. discuss including segment, growth. our by morning, to results. Paul. for X.X% Good driven and growth grew quarter, and healthy $X.X us segments thank Fourth today X.X%

manufacturing in and our project distribution education solutions, segments reflecting solutions, technical and education technical M&D. and strong solid posted closeouts positioning growth, Our also new and several clients

robust market. sports event and offset in in estate B&I, hope recorded to softness organic modest where continued activity special entertainment real also We growth and commercial the

another of as $X.X billion, in cost Additionally, solutions our with push price our in and delays to pleased win technical as team great ability record project with new our set progress XXXX and microgrid our well sales resolving which a increases I'm effectively certain structure. new accomplishment. is clients, sales bookings manage

income, As a income and net result, an EBITDA in EBITDA generated and adjusted adjusted ABM margin of increases double-digit adjusted X.X%. achieved net

the our discuss I'll demand groups. of industry now each environment for

a at the vacancy directly B&I. in XX%. rates services relatively percent XX-plus Office on basis begin janitorial around fourth Let's density blended commercial remain with our demand for quarter These with in office impacted factors static the B&I. near rate

see office work next Although the we continued the employees gradual spend increase time in expect a the model years. in at remains prevalent, the of couple hybrid to

leases as XXXX, office expect their vacant will clients demand in reoccupied. footprint for put forward to pressure office which floors plans and We will services until their janitorial on downsize many move to expire with are density, match re-leased their

impact the requiring If to our expectations. return muted current companies their proactive office, the be may become employees and more more to than

ABM our navigate commercial to remains Given labor model, real estate. flexible challenges well the of positioned

believe largely real our A buildings. more of newer profile commercial quality As are lower consists which buildings, a than multi-tenant reminder, and Class resilient we estate far

market. commercial softness clients an density. demand reason has X% less correlated care, by influenced That's B&I in of which and and services, than to janitorial our all to segment revenue that engineering are entertainment in sports estate submarkets real addition B&I's health full important year like why office provides far declined In services and the drivers despite less are

flexible a portion labor commercial performance model, summary, plan of through In our next year, we and and lines. of markets and to the the in mix estate impact will management B&I's service our real cost while the mitigate diversity pressure impact tangible end is of

including quite travel over The comparisons Moving we business travel, due parking international Aviation. into that large although XXXX. remain and tougher XXXX strong project to and solid leisure the QX face carried to year-over-year markets, of in should XXXX, be

Our has historically ramping volumes through executed while tight above up labor aviation market team managing service extremely well, to levels. pre-pandemic a

clients the also kick janitorial core within manufacturing of our including year. continue core to newer final has clients business, and with in distribution in, continue half diversification with They segment expanded airport in all remained business growth efforts pending offer the on focus along strong, e-commerce core and and X to the including their logistics large services our which markets. in increasingly semiconductor opportunities from projects, support order win exciting outsource X new airline from manufacturing, business biopharma contracts The first approval, to and clients of markets operations. benefiting end our Demand as

In the addition, we of growing see momentum manufacturing. onshoring from

and needs of and M&D work to valued their As rebid XXXX normal we process. quarter, large a as in we client rebalance procurement mentioned last part their expect

clients with been opportunities team working through and revenue the anticipated has Our in end to other new other pursuing reduction offset expansion markets.

M&D the high Over single grow the revenue midterm, digits. in we to expect

growth the will the impacted XXXX However, rate rebalancing. be by

by the and education. to clients. during We new our generated on won well organic driven year. pipeline by several the contracts sales revenue XXX% addition mid-single-digit of Moving in-class growth executed and We learning new

expect growth year XXXX another stability. of solid and to be We

for $XXX system interest the Moving segment of total. HVAC, on services availability XX% of market even and lighting the ROIs soft to were a legislations. the on as able tempering delays EV whole backlog onset. as energy progress up legacy projects performed after projects microgrid fourth close nearly of we several completions timing we out with return Solutions. We to electrical expectations bundled permitting believe make conditions project rates quarter Technical this Conversely, and Segment chain primarily supply projects fourth legacy government following pick of microgrid impact coded and year. experience projects Technical better expectations funding hard through which funding XXXX the to retrofits in continue due the certain higher earlier quarter of and we in solutions, Solutions bundled the reset representing the in energy several predict, government includes projects and why will to now once in is to million is exceeds solutions. get which The are and

recurring large interest forward, projects to the the the remains of during Looking expect advance infrastructure including we for level microgrid bidding microgrid projects systems EV year. opportunity activity high. Also, revenue and and

of Solutions. XXXX Technical We a be expect growth to solid year in

to our turning Now elevated initiatives.

quarter. in for cloud-based the Following on system ERP the X the we segment, financial fourth successful new achieved our Education more close milestones

launched improved pilot -- optimization approach segment in tool a the operators we sites this in segment. to with Education insights with management By This this tool for scheduling, workforce that enhanced and released last thereafter. attendance tool allows deployment First, solution and the efficiency providing a provides year, further new workforce of for productivity now pairing with expand visibility. time expect new for managers complete entering we our we of more the phase a XXXX rollout to and we are Education to modern tool

more app app new initial release in is hands called than milestone of XXX currently Connect. member, mobile team is team our frontline the second Team The the members. of The

digital and other provide capabilities. a safety create on-demand our app of connection will features integrations real-time year, tools deliver driving in delivering transparency on the engagement next These higher will front this clients clock moments, to a services among line, training, and updates out clock that and Over the to level management more task performed.

lot we the next plan this XXXX. scale cloud-based of outcomes of initially shared learnings deliver of successful this ecosystem our to years, had group the year. in Over Day our industry a in initial ERP late also system from we couple education during Investor the deployment earlier We've

to any applying to potential operations. rollouts, ERP ensure to segment future those disruption clients minimize learnings and and our are We our internal we

year are the As than transformation take deployment total said than our anticipated be cost a full million higher members. XXXX. million, on about the modestly and $XXX be team more and the a impact which initiatives likely in $XXX We about we positive is program result, our having we that will cannot first longer clients may excited expect to about

Our in expectation will these our industry. is game-changing capabilities be that

contracts a we new to education Looking in where continue we winning as job back in M&D at as did well our performance large in expand. terrific aviation, in XXXX,

and that challenging Although generally in some we commercial estate better our nascent performance same further In aviation, as time, progress challenging mature. will properties. At some the remains in market, flexibility expect business that portfolio model we impacted Technical our performing conditions real be XXXX, and delays remain healthy and and Solutions, we will that real anticipate B&I, project and the M&D. quarter, market for Class experienced we benefiting towards the heavily improved in the we In navigating market the the labor M&D. markets this rebalancing fourth our weighted Solutions, office from effectively A estate in Technical education expect by we activity are

We to XXXX. compared levels growth projected factors, the inflation achieved strong will margins lower when likely cause mute along revenue expect and our labor incrementally these to with tick we in our

outlook specifics in unchanged from XXXX therefore, quarter. Our comments XXXX, of the Earl for overall is our through we essentially his you outlook the comments. walk will shared last

scale, to Through technology. XXXX As in expect depth initiatives, and we new our record we XXXX. look offerings set service forward, Elevate sales teams another our in leveraging our we record after sales of are

make proactively as to addition, cash course, cash to cost anticipated continue to just to changes free necessary, strong did base, manage long will the for regularly and our our XXXX. to enable cost us we continue returning our In will shareholders. invest in while term if And of we carefully flow

to turn I'll Now it Earl. over

morning, Thank Scott, good you, everyone. and

please comprised X. revenue with those a billion organic along our X.X% of Raven following Slide you For Fourth increased of X-month turn bold. to contribution quarter $X.X from X.X%, revenue presentation, growth earnings of of

versus $XX.X expense by year. on labor Moving Elevate and the self-insurance prior XX% lower share, of per and $X.XX X. million revenue, up the benefits in Slide income increases were higher was costs, higher and driven higher XX%, respectively, segment year the largely by offset adjustments or quarter to These last fourth on costs. partially diluted earnings Net interest

year timing. primarily cost adverse EBITDA higher partially income XX% price including were and of increased prior EBITDA X.X%. $XXX.X prior by costs. driven the compared Aviation improvements up grew XX% which the net as project These million year-over-year in several and benefits earnings, to our the including interest was $XX.X earnings, was closeouts segment segment the from increases by and basis million Adjusted impacted by labor Technical earnings and performance points period. XX Solutions project offset prior higher per higher reflect Adjusted margin and to XX% year adjusted $X.XX efforts share normalized and management expense adjusted increases of year, to These year-over-year over increased in diluted over

X. Slide to estate $X and revenue strong on special beginning results commercial sports demand reduced segment our B&I increased demand, to due to offset turning which Now event in billion, real partly modestly to helped market. the

operating to to and B&I versus as million well which and going again prior margin once benefits period mix offset project grew increases decreased X.X%. and prior within was to new segment operating driven Aviation's Operating by our X.X% the timing, and in to significantly travel wins, operating These profit $X.X expanded in margin negatively leisure expect adverse increases. demand of the as demand million, we of was million and higher year price $XX.X adverse reflected to increases period, partially forward. and volume by as robust the cost Aviation business actions. declined price year $XXX.X service absence the XX% million remain and for $XX.X impacted business profit strong Aviation

year. largely clients revenue was modestly basis organic new and the Education Slide up operating attributable labor prior basis grew operating profit customer Education to points Operating was X. of demand. market. margin while revenue broad-based addition reflecting a and increased $XX.X increased to largely to million, while X% $XXX.X increased These the the to from margin XX due increases margin revenue mix. points $XXX.X to XX% benefiting Distribution in X% improved million, over to year Turning profit Manufacturing to to Profit and XX.X%. $XX increased declined million were million, XX growth period, X.X%. performance earlier

profit was closeouts, and grew of and to Ville on contributed acquisition $XX.X Solutions growth XX.X%, Technical volume last now exceeds largely noted, prior compared beginning operating to Technical September. XXXX. gains over and due to After storage several system organic to Raven project Solutions to of higher onetime large contracts. of reflecting note, This approximately legacy and year These margin projects. million an million. closeout XX.X% $XXX.X which portion even is to performance of comprised $XX.X were million projects $XXX of X% in a Scott largely to backlog Of of scheduled operating split revenue battery $X organic growth related convert progress and the Solutions contribution. in the period these between margin million profit million Technical was certain and increases year. as

at Moving the end in billion, including we of quarter $XXX.X equivalents and million. pro of $XXX We fourth flow ended and cash million the the in total credit, of X.Xx. was liquidity QX, $XX.X standby of letters adjusted was million debt for of At $XXX available with ratio EBITDA of cash million, fourth had $XX.X strong of quarter to including cash million on Free the year. X. to Slide $X.X total indebtedness a resulting forma

was of repayment $XX flow year $XX and full million, million costs retention in million, integration Cares received Normalized of million employee Act $XX cash Elevate Excluding and $XXX XXXX. free credits of our

common quarter for $XXX at million average of fourth share X.X a repurchased of the price We in shares per total million. cost stock an $XX.XX of

approved For total $XXX period. current million up shares prior our $XXX.X from repurchase subsequent $XXX our the the repurchased authorization and reduced count is year, The we expense Interest Board million year-end, million a to $XX.X now full for X%. the of year million, was expansion excise Also, $X.X million, million. X.X authorization. by our share share excluding taxes

Now let's XX. XXXX the fiscal as move on full year shown outlook, Slide on to

call. view Scott comments for on consistent As quarter third the we is mentioned, made our the with XXXX earnings

Elevate EBITDA $X.XX mix. expected margin to expected to business largely and We in as expect as driven by X.X% revenue M&D cost change the in Adjusted is a This of and be B&I full $X.XX. EPS well labor X.X%, XXXX be a cost includes lower shift to by in range initiatives increases. activity, price adjusted partially janitorial mix in continued offset pressure,

$XX The in range XX% XX%. discrete rate to to Interest tax is of million. expense estimated to is the before be items between expected be $XX million to

free be of the cash Elevate million for turn Lastly, excluding million full integration range normalized the Scott being the expected $XXX of year let that, majority it elevated closing With in $XX me million, back investments. to to flow to $XXX comments. and is estimated costs,

want solid our your questions. and eyes new I commercial thank Thanks, labor a for clients took to efforts despite their holiday teams I ones and new a and the introduction season of Earl. and technology throughout our our challenging and let's performance. With the incredible dedication healthy and never estate real and very year. processes, off teams markets their delivered and wish happy loved that, you happy year. some through take

be session. Instructions] now will [Operator We conducting a question-and-answer

Our questions with of Jasper Truist. Bibb line the come from first

pricing respect that of I kind the what provide 'XX wanted and helpful. assumptions labor inflation underlying inflation if perspective cost from labor ask seeing definitely with and guidance be a you could to you're there, rate for to recovery and would

Sure.

agreements the they're thinking in we we're X% us, collective for going of country encouraged to And So going bargaining workers lot across right the range. A feel are in process be end the it's now. for that to in the range. to that X% janitorial

union-based they're labor and to guess to our as agreements, is be the collective So lower will which the on the that be it a with higher bargaining range, agreements, look rates. little X% going for in markets those we nonunion the are

successful been few that. over range. of of So reminder, XX% And years to recovering XX% a the again, as X% we've that to just X% last

thinking. So kind of that's what we're

on was Elevate Makes And I to progress. sense. an get then hoping update the

perspective benefit there end of on we any be 'XX? aware kind months? the be to color about by like cost on ERP from capture And of you you where a deliverables XX% key fiscal next you've the mentioned should Any deployments call, over last are already of the of cost think there. I captured expect the XX

Yes.

the XX% we're segments, tools. we execute And probably range, group we we're put different on in can something the some think the of captured -- time I benefits actually to of escalates in that date. as industry that So of we've X/X that it's the kind then over

$XXX be So out I to over up a that going think time. that $XXX laid of just it's range to to million we ramping normal million

we're So on track on cadence that. with our right

going as planned everything right So now. is

me. quarter. up pace this the Last for it. of repurchase think into How capital Got The performance about question should XXXX? really the stepped we company

future compensation. look really for after say Jesper. we Yes. we're capital within the 'XX that we're the in in the return QX. share our that No, share-based price dilutive a saw compression FY thanks question, at the to that shares shareholders buy as we minimum, our back pleased would we'll of against over able I to QX, And to our especially back light

authorization now shares. of We board $XXX have worth million about for

be we'll sense.. so opportunistic where it And makes

come next Deutsche line the from Alwy Our with questions Bank. of Faiza

to scenarios timing. sounds of I about ask solutions. is the So alternatives revenues, wanted but on guide given it quite know Solutions don't to like you the or technical range just wide I of range Technical

So be on of us within business a you more sort expect how realized? projects pacing these give expect project how the Technical to And the perform new do revenues you bit to color underlying Solutions. do of

for Thanks question. the great. It's

feel look, it progresses the work, a it's summer, again. as And remember, love lot going Faiza, because margin Technical the that So of that from They Solutions year for a in the do strongly to We're little Solutions, we is 'XX. of Technical you serving soft we it in margins. a the We expecting here. seasonal end right? technical quite the be kind ever about solutions cadence high and then starts think year continually through off standpoint of strong have. a post markets we're And we single-digit

the guide the are as -- the excited a strongest and we've just this don't revenue, question for We that. that growth about year. had backlog the reminder, of are but backlog And locked contracts So have starting just that work. -- ever signed and in we're a it's to excited potential we about we're

Technical this really feeling So we're year. good Solutions about

now follow-up I Technical ended us a that, you've give fiscal there's Solutions. a bunch there Does of could us on there's in that just items a Can of is a 'XX? the things, charging you breakdown you just bundled underneath segment? revenues Maybe know because fiscal breakdown give the EV bit of 'XX, a energy, other different the

Sure.

like sentiment describe So really way are feel just about yes, both EV energy strong solutions, to remember, had guess there's growth coverage not if the Raven is we is it industries. they've maybe been it taking X news as exciting or our rates strong There's was. past. back there. crazy you areas. that in sub context the vault. to Because there as the And lately those bundled really But And that's all has I all different is growth core and the that some best industries, to a pointing EV step on signs in

a lot excitement of what because power. And to this that of the run lot out infrastructure. the And people it realizing not deals like is there's they of card feel is going they're truth is the that's a to call impediment fear are range

the for way infrastructure see catalyst, light. fact is growth that So we the to the for is us, EV, be going the catalyst our so

happy really our backlog. about we're So

really us. a is segment going to strong excited about. So Vault, EV And really for we're be Raven

it to and hard one Because right? Faiza, it's close And not frankly, they're basically it's that it's strong the installing you're about a projects. vault backlog not the like big backup to really half think the our battery. of these projects, to in is you battery in Technical frustrating got time Solutions part, backlog, and is probably fact going way around And these have We Raven very quarter-by-quarter.

timing equipment. permits, So construction them the it's project, the a field, and are getting These like construction some are the size football of battery getting of project. of almost a right? fields,

to look $XX So QX? perform. confident we're to to but when year about is going a most than strong Raven really projects then I going the Bundled is right the Volt these Solutions. you I insight, at heating out it's the air is school, up And be And we But the there pressured. stronger across performer a and QX and can getting that the half better what it you that's million feel back interest low. IRRs these rates the get be lighting, tell that typically a for piece were or be project, first you It's Raven not big in the last retrofit where that's year, going to the is equipment, equipment. hard And be want whether think but to Vault's strong frankly. one happening changing And ends it's of to year it, going stronger for conditioning now, the when think than is you the And the We to think way ATS. big, another Energy capital of really about are go high half going schools.

there's now interest a solutions. that through it's down, CARES what's of plus, bundled interest back causing funding higher, to rates are and come been a rates energy And you're little that's lot bit in Act. where the to them why of push And But government see a happen. to seeing going step

there's so lot a of there for money free school. out And been

So that's end sunsetting to of we think this towards year. be the going

it be is probably suggest kind used just It 'XX. of not year, where what run be being around that soft that we're in over projects. they'll not perform bundled which still fairly million more at used they still to. was at would 'XX, will half of this excited I about to said, their rate $XXX But solutions but will in that energy be that So strong,

color. hopefully, more So that gives you

talked you've And just any all? are thinking capital sort at the are expense one about about But any debt on your buyback. just quick assuming And you know paydown? debt is Or talk little paydown? allocation a then your that about of share bit interest I a more Yes. you guide,

in Yes. It marginal paydown debt. anticipates

to comfortable that we'll amortizes the leverage about leverage so pay in our feel when probably And think of bit then you maintain looking loan we're that a very term material level year. look of we a some you that And use have nothing And there. into cash $XX about X.Xx, year. excess a But down at if of to next we revolver. the of million

allocation, plan capital flows, investing provide cetera. through to continues consistent. in low in organic relatively it our Elevate whether is us to shareholders. back with on allocate M&A our continue again, our to the it's cash based the comes it still strong talent, leverage, We'll invest et to opportunities or When growth projected to capital, flexibility program, returning to And

with line Our next from come questions of Baird. Andy the Wittman

I the segment. guess just in the quarter understand Solutions to I want a little bit Technical better, particularly

And so for Earl.

So closeouts XXX% you adjustments quarter, them almost come basically always, and several revenue the talked you've the recognize were closeouts revenue there about but expected in better then than profit basically oftentimes, when against quarter. how of that after a bunch on whole accounting that you in and are been you finish not in projects working

I that year-over-year something paying mean you're saying that sure that you make we're different? project kind to saying attributing profits. how to by what -- on what Is want clear you performance? revenue contributed by and were Or significantly the the just of and revenue about growth to closeouts

business typically and QX that quarter, about our the half that. in with When able back think spot of were do that we quarter. a And actually that, now seasonal amounted QX. projects you're talk million. $X profitability billings. about And the on, There as able I largest number Andy. Yes. it to holdouts Remember, Any you're final closed QX to that a got result in No, capture of your being out. you a is to had, you actually

So which by keep mind means would quarter we would than others. into run be that that rate no be know in QX, a a typically lower

The in $XX quarter attributable revenue the to just I million only understand true million, whatever Is sounded closeouts. other might be that growth revenue was it not? like $XX Technical to X-ish guess Okay. Solutions. trying your the But that. or -- X. was million for also like of gain

on battery a be on if had would No, where finalized. actually certain for waiting regulatory first the you volt -- half storage of throughout think we but projects the of as inventory getting delays the not year, the that authorizations only Raven about supplies, lot we're

close deals you're So able of profit. associated to number And seeing on a and a the we the as result, actually those were QX. off in revenue

And in make press saying Okay. just kind sure of you're the That's talked helpful. or I'm you understanding deck, as to had segment. there report release entertainment you just there that meaning guess you're B&I sports your there should your what -- don't diversification. diversification. Or slide in I well. I Scott, here, on then, traditional want Is call it, good other mentioned your that the is you you of and that aware we to and be from, diversified services? that the dynamic know, some way I janitorial that referring -- about in

partly. Yes. great Yes. It's It's question. No. that. partly That's a

We segment. have more in health a little care But there. importantly, the engineering

engineers, our and legacy density. So and a lot office with change had stationary just XX% of if business that's that occupancy you think the ABM. about, doesn't about and especially with the Able of able acquisition, and where engineering, We is between

relatively change. and of as really parking XX%, you since And segment in we've occupied in the XX% that's have room engineers an stable been out you're come that that's not or to pandemic. If whether engine well. we going have

the variable. which more it moderates the So is that that of becomes Janitorial, piece

the and guess, this so I again, to Andy, truth it's glad all you So having specifically. like speak, so question by janitorial to you we so we of I'm want kind purely mitigated just that is, the B&I, that based because up it look don't density variability, of at brought engineering because as look on when at

Yes.

program make the Okay. ELEVATE wanted just do. here. to And just now that I the, I I we understood and sure guess, then on just --

I to is, think it's $XXX number year said you taking about what, $XXX. The So heard a new longer. $XXX I

the I spend think of $XXX previously, total Elevate high the was end million.

in were delta spend like around, the guess think, like. million planning looks that's for I I of 'XX. So always $XX you

what the am low math $XX I into saying you're takes million that Xs, Is So the I extra $XXX that about Earl. here, doing that the -- million year thinking extra like is correctly? with am number that today? the that the Is from here delta you

Yes, you are.

an a it's spillover. extra have So year. we'll --

remember, higher in throughout of actually about planning for as $XX followed are FY a being 'XX, by the 'XX, numbers, bit that probably almost could million X rough down years. it on You think tails you we XX% for next the

kind Scott, of then, what the learned the some go a with challenges operational the you maybe bit can causing the challenges the way little extra extension are that and along that's cost here? talk program. along technical about extra the of you've year And of or What just

complex, so about financial are way things would it right? in talk all it ERP, -- it's part other data about a you system, the flow think and systems I think -- through has these putting the pipe. And Andy. Sure, in deploying a is And I system, that it, it's to and your easiest your right, system, the your of about an whether to out when is think like would system T&E procurement payroll the

a and all ERP. the the all training, the to processes is data of what systems all where care to of system. originally the expected longer creating almost it It's new field look you right to a wheel. which these going as And internally, it's just to coming it's all system, we flow you reference, learned just education frame launch get we then part out questions it's the and no had hyper the start got it we and because go once answering they right? at is basically Lego, of that And like in taking we of up of I then have And like clean call the as around -- that, than of middle using the set -- LEGO with take at and ERP the you the is the all longer

-- and them and group work we than over point So system a had us I ditched think Andy, the off that, it's now some we're start were change more SAP. again. Oracle It's is with helping to is here, this that going was going a we specific and scrap anything, the like not rails. strong consulting and had It's that's we hey, and process not like, we not with it to

right? we really have so and for the year thing us longer, payroll it's are risk right, about is and to our our fact take make So it's going right, reason. this internally mitigation to of that we the it's like shareholders, our none and missteps we are So is really sure to invoices most about just do good but can to payables everything our all is that a right just important

with next Our Chan from line Josh UBS. questions of the come

the mentioned I you drivers 'XX. the margin So that. behind guidance appreciate for

drive think up as guess XXXX, or of are going the And think I about the how will what factors down margins? this should year? you beyond beyond of So some that it we trajectory about

Thanks. X.X%. be we up Look, is cadence a think to there going Sure. to our

back, because we I to much think will set say want more 'XX be estate. think in And kind overhang of challenging of don't of us the years 'XX right, of of trajectory to so but and because stall that's -- predict, the kind for a is one the 'XX. commercial I our X-year real

will it at out the get of time, But we a same right? just the we're cadence be problem, around once up. trough, sitting think normal that admiring and not I So

going And the tools in that's prepared industry the all We've our with them phenomenal. financial and kicking frontline to system cost start about the be in lighting workforce because talked a benefits my structure. and able segments going manage day changer these overlay help to made communicate be our Elevate night. remarks, management to up then It's and we're to like of ultimately and be to new just as this that we put I employees and some our labor changes start app during going game

think, line it's up, do get trough suggesting be we commercial and past going the X. think estate straight we're key when will we're won't be the a real thing it that probably year to but I another again, So just or

Okay. you higher then guess, could I it's want amount follow obviously of a talk what do. lot repurchase And up on I the just to and normally you the repurchase. to than

you how if deployment, change any terms of versus stock And so about philosophy other mainly think I the just I there's in suppose. M&A, in means of wonder

Yes. in philosophy. No change

the now, shareholders. And that's at have year. Currently, [ is looking that organic and excess going we how to we that compression in foremost, we're growth. look that investments. saw we we'll back take balanced you right actually thought other the look actually investments that that at we the approach. and capital take we Elevate we when opportunities, fact mentioned, consistent price, our we to actually actions be to cash anticipate our a that have deploy that, key forward, we best X.Xx, in at allocation, with to to and And it's sufficient we going prudent We the way As want When when actually QX after we M&A the next first share look with going actually feel but leverage. it growth, -- organic ensure was investing to there ], manage after at

So look at we'll opportunities allocate and continue accordingly. to

Our line of Sam next William from Blair. questions the with come Kessler

beyond to about of still. XXXX that but I hope X% environment long here, doing a get when to B&I then B&I see Scott. market. you guess to get your calls Yes. it And last in down that to that Thanks, guess it this to year broad mentioned X% challenging it XXXX. think be to, business X% guess challenging your to I'd I maybe X% for on trying commentary how start this the for I Just of coast in I like mentioned the right chance to a outlook type I there. quarter is you well. today's start you first, down commentary want goes next that? thoughts think to kind here. there hope goes also way is just they're And I could

Sure.

you're kind on thinking how revenue side. of I XX% growth perspective you're about spot So the think that

hit do And you and think XX%. about to it's into we're I going yes, the optimistic So more we reason go think And that. beyond.

So just that coming 'XX from leases a due are think pure they're of 'XX. and in saying standpoint, statistics all I XX%

the narrow density a of So to a your with of you're comes when kind volatility opportunistically, have chance up, that to you compression. see Because lease going you some bit.

So that's X-year why problem we extended. think it's going to be a more of than

and out and probably stronger it ago people have was labor becoming But everybody organizations a too, having shift importantly to we versus office come want there call on is have collaborating. you, now into you're employers that, right seeing tell were sentiment bit tell really released are there's right? for being of people when getting power you networks, can my situation environment, different, about CEO you now I frankly, collaboration. that There's stronger peer studies a saying year X of people on office these favor or in on who I the macroeconomic to So where is the effectiveness on-site than the all over and the we're back. seeing return more the like giving it going on work. back I employers a the of all are talking think bring by are to more power in and And to to

I So episodic. it's think

I think seems it's 'XX. feeling, and won't I general the as sentiment. even to and be And 'XX. as be suspect 'XX our difficult XX that's it

broader commercial how guess the out growth of between are cleaning you could I'd very services. Very, within Maybe each and Maybe rates color. then. those be break the curious B&I helpful Awesome. portfolio. engineering I sticking just doing with

between anything to could like stable, lot Yes. really weekend high-level you equipment requires of. color, or right? see not I day care again, in building and engineers Engineering of the take to variability right? guide I on some shift. night tell office a if don't But the you -- That have care an shift, will be the taken that. do has it downside. You you more Because shift give is the the We to just equipment revenue -- and

is, doesn't what occupancy matter to run have equipment. right? it you And Because the that

still to building. You're delivering the conditioning air

to that breaking and fixed. work doing mechanical You're electrical still be pumps are have still

XX% why that you have at being stuff look that's this more stability. And I that variability. more, being like you you ends having the of flexible, it janitorial guess, up happens. if all B&I, It's So side when will,

across Makes of any markets, parsing or you. in the numbers and Maybe not more more terms you could biopharma opportunities out you'd related maybe logistics, -- maybe head XXXX? I performance Got sense. here, actual asking growth curious think semiconductor. one growth I'm a these characterize how to into as the you end rank for e-commerce final the just

Yes.

that, good really but we'll the higher the and some it's think a done we'll in really like a But this semiconductors, growing But focusing more be side, we now we've of because going every job We areas. good doing. on big one this like where some impediment look, single-digit is client. little high the manufacturing all that grower, fastest those in the will stuff outer one probably we're of normalized. after you, to I our of tell have biopharma, growth So 'XX years ABM. we're growth there, in of confidence e-commerce rebalancing to Listen, be have have see that of

distribution So industry really and enthusiastic about the manufacturing segment.

of questions CL with next David from Our the come Silver line King.

Yes. a Thank ask question aviation on you. I'd segment. your to firstly like

growth and margin or in performer profit, in in by a both year, but revenue was this improvement. your of it margin especially not growth terms the -- segment So absolute and operating clearly wide best revenues income biggest well,

undertaken say last there's to I know number which of the over bear I would initiatives that starting couple are you've a So of years, fruit.

where scale meaningful positively travel expect of you a whatever, they've your terms In ABM or X or evolving XX there? that, from improvement don't opportunities as of is as in continue do XXX to another assuming been. know, next to other air on exploiting or strategies fully flight the we But X words, trends year, think air I should

That's good a Sure. question.

much that So on there's so excited going we're in aviation about.

remember, happening modernizations across were been may on on development, that ability to to last back, shifting new airports both about. had and all saw the a our And then few we've phenomenal, that years focus years airlines operate you really excited team country. have been we place less David, business started for management of the the we business. we've couple the Firstly, a in the because And on

that example of the LaGuardia. perfect And is

basically where XX% airport services, Just it of large is new in says, We the got facility bunch is the client a we the just these ABM got I "Look, Terminal which don't which like, airport, very B -- do named world. you Performance Solutions, self-perform a services. everything integrated we of there. call APS, is best that know,

of all In as you well. why don't our addition to subcontracted care that, take services

and everything bundling together run us basically letting So it.

B, just got. LaGuardia at got contract Provident handle of we school also Terminal all we systems massive So a to

excited we're pipeline So and to the around airports to growing take about this there. Performance Solutions is country, our the ability ABM

travel happened to project parking air 'XX. had a the lot up. remember, you up. year. So expenses if Aviation happened that but in by helped, the in It be It also continues great QX paid really XXXX, got is in of in was a really, we XXXX,

profit about million. $XX the flow-through or $XX million So is

ability very and its loving So we're very, team. year, again, that helps well. as growth and the aviation next for enthusiastic about But

would just share for like to I the repurchase a clarification activity on And ask quarter. this

XX activity a were there your I ago. days comments, quarter kind Should stock but of my after early in the to already, of assume understanding. couple just the the concentrated of quarter? that was volatile fourth sharpen So certainly was I'm quite In words, trying other bulk

quarter? other opportunistic? more and or in would I it that know, Is was was spread say when you Or don't in, through balanced activity little the programmatic more, concentrated more evenly hence, maybe more a words, the

when was more emblematic front-end look price, it kind at that like where QX was is hence, loaded. average we the which was of it of And shortly the call. No, trading $XX.X definitely Yes. earnings after

be to and would Scott, question of I I'd and competitive a like your today. the But I then kind maybe this last should for the pandemic say back of then to your ability business. and to to new I'm you immediate few And And in compared and aftermath look Great. Scott, advantages -- guess. gain related is sorry, years

of of sense your company is pandemic some capture are in softer. program -- than to business scale, a bit your maybe least or butter in bread stronger But just little purchasing is in some probably the in years value your my your business, in a and [indiscernible] strong very immediate from better position like number equipment, your things because to even of or parts whatnot. scarce your of when in staffing, because a core, at source as customer ago new go-to-market began, aftermath, we're ways structurally of power, kind that a and kind as your commercial But terms real the enhancements it the strategy et estate, And commercial the proposition well advantages. internal post- little and cetera, was Elevate to ability of a few of industrial was

of helpful. Maybe clientele be But say, has how the years across if let's would over of shifted, and look just et would post-pandemic think bread and proposition for about you the cetera. couple butter at kind How that, you kind last manufacturing, education of the in value environment. core kind that you particular, could of your on as comment

Yes. social sure. product. think And our would clean it's positioning on too. got has admit great different I our media. Yes, than our through our competitors. brand, pandemic changed this We're enhanced that, certainly think Look, as more competitors developing us, exposure a We as came I I for so guess much a deal we

we a you If did commercial. remember,

clients. it's become if And you prevalent. to a talking guess, different development -- just and when more just we're will, it's swagger, we've pursuing So I business

from is that them all sit on have Connect Team across going a going to show a It's game digital of that, the monitoring in we're going changers. And shortly, then you presentation app investments their and layer top be how in in connect just the and that very to team David, all client ABM the to dashboard members client, our this them facilities field are the us. to to an we're to making with in technology and of how and

was feel in And possible really our we years that $X comment new to sales. another I this And it record momentum our back, would having of aspiration that we was -- true -- had by bring is -- I that a like the new was off We give were put north out like a palpable. to few just were we that possibly sales. there. saying is far very in we're So billion close -- just year a you context of like

our billion in new they not year, in, of revenue, this is about over did of probably business. bigger we in in book talking brought what nearest brought I'm their what in, total $X.X sales we And than terms new sales. Xx I mean, and competitor

have we So compelling like we a really feel value proposition.

Our final with from Marc come questions line Sidoti. of the Riddick

know things. of on brief be gone we've this. into a I lot deep I'll

to about the wonder there the could education So us and update a could space? in prior benefits talk you you're you're as gain commentary margin of continue wins, the there visibility, seeing bit revenue of business you that what there you and the strength a profile Maybe the little with was new of to little if to the opportunity seeing bring bit saw the that. what and around share maybe an on some

under we're about And but do I not got K like through something before. the And clear this LaGuardia, million then our brought higher our us, APS about like, clients at everything have positioning. We're new XX strategically on only We're happy earlier, put or solution education listen, and Sure. and that ed, We've that in pitching education, to in many year. margins great $XXX said our we're growth that Mark, and what so so the education we that we held split in between to are that. we'll now business, our can never pandemic. over since we #X done manage and Provident district, it. that's up things self-perform, integrated our school

year. We there. growing really picked up is pipeline University last Our Washington George

growth project the the again, had get time hopefully, kind segment. just that year. And about and industry pudding, tremendous frames we excited of we'll proof we year longer and But just to we're this Usually, in So is it's plus. like decision really group. GDP-ish GDP in typically a

So I appreciate you asking question. that

you. Thank

the now I to for session. closing We would any to end turn remarks. of question-and-answer Scott Salmirs the over have our call back reached like

be want we're a excited it. at everybody out 'XX tell challenging environment. this it could really their about that and were we for to ABM did. way we just attacking going And be and with We thank is enthusiasm, will the interest, that. in to year Just But know business close taking excited everybody for the year you to I the team

giving hopefully, loved ones, forward an with we have holiday, some look amazing and to update get QX. your So time in you everybody, an

So take care, everybody.

Thank does you. We teleconference. participation. This conclude today's your appreciate

may of the Enjoy disconnect this day. rest time. at your You