Rollins (ROL) 26 Oct 232023 Q3 Earnings call transcript

Greetings and welcome to the Rollins, Inc.

Third Quarter 2023 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Mr. Krause. Ken you. Thank

begin. You may

Thursday, ladies Welcome and conference for day, recorded Thank [Operator gentlemen. the Rollins by. today, being to is earnings This standing XX, Third XXXX. Instructions]. Good conference you October Quarter call. XXXX

to and is third quarter Good Ken welcome call. Krause. morning, our everyone This

background a us take Rollins. to Depot. Before is to of VP you team our to moment to strong in attend most from formally we're her Home just have very joining the recently begin, brings we excited of like Lyndsey. introduce we Investor Relations I and several join our to She Welcome, investor in new many Investor introducing at QX as a I'd forward conferences. Lyndsey Lyndsey Relations, look Burton. her

everyone. and Ken, you, good Thank morning,

addition on release the also presentation a we supporting the release yesterday, website presentation. our earnings at are prepared issued and company The earnings has slide available to In that www.rollins.com.

non-GAAP part financial We have measures discussion included of this as certain morning. our

on The of statements this today. subject as today's other statements that and These any discusses we make excluding results certain forward-looking in statements. business from The release. outlook presentation statement have the earnings the company's forward-looking appendix non-GAAP been our earnings a may well historical and facts, actual all are in particular number as and call, made to uncertainties risks contains of available and differ reconciliations are materially release

September Form filed XX, XXXX, release XX-K our be XX-Q later the Risk section Form Factors refer and and for period the will today. company's quarterly which the including December ended of to the ended for Please yesterday's SEC XX, press filings, year our XXXX

opening Executive like would for today open me some President, to Gahlhoff, speaking Management Vice and and questions. with Chief Krause, Ken President Jerry, then you and your line will the Jerry Officer make Financial line Chief remarks Treasurer. we'll Executive Officer; and the are begin? On and

growth reflecting Thank delivered morning, execution our profitability, continuous our and of to I'm that in quarter everyone. Good and Lyndsey. pleased report consistent improvement Rollins business. strategies you, of another good operating

for million. third increase over an by of $XXX XX% Our quarter was the to in financial performance highlighted revenue

report that this that over performance Pest XX% Control a across organic all discussed solid on pleased see Commercial the service approximately quarter growth up was Residential activity XX%, quarter. June to robust, of quarter. continue we Revenue termite X%. we increased following to and the XX% this the reflects I'm major last was lines as Further, approximately rose in performance slower

growth consistent We of month saw in the mid-teens the each quarter. third

observed North We America. markets in strength control within the particularly have year-to-date, pest continued underlying

Additionally, shift large, to to key fragmented migration and the our of DIY home. more stickiness four, limited of addressable climates; at trends, warmer to: are not from number supported but population by work including to one, spending secular people time and a schedules, changing leading two, do-it-for-me; three, markets a patterns; hybrid weather

business in look believe to model. from elements attractive benefit key we we competitive our continue we our several position of at As these markets,

and revenues look mid-teens. the last slowdown Great reliably the consistently we've you in mid-single If We Recession years back grew and industrial in through grown through over digits, so, the or on XX XXXX year-in the year-out.

organic XX generally Revenue single-digit quarters. of growth in pre-COVID We high last growth accelerated that has and each delivered continued. the

the growth market believe well in should areas differentiated have position me secular market a the years. and mid-single-digit continue to several over us X highlight support where that we Let next key trends us outpacing

of brands leading strong markets. potential additional and the our portfolio opportunities. bites apple group companies gives our multiple control of combination regional us our with Orkin of position cross-sell us First, pest at unique customers in gives a and The

add to and of customers door-to-door help and of variety reach drive a customers. our marketing, use service with or existing relationships we all Second, the engagement to us methods, Digital further bundling customers. residential depth customers sales existing methods new new cross-selling, acquire with

We market through capitalize and residential able to HomeTeam on like relationships estate and multichannel drive this communities have the growth. We're Northwest. real homebuilding brands important also approach to within customer

Third, focus we're customer last we quarter. verticals our a targeting very growth enables acquisition, key our most have share the focus and executing clarity unnecessary core consistently investing control strategic to don't have in successfully been attractive not in profitable. to and very XX% market. in a our of paying off This the least, clarity that grow This in and we pest ensures long strategy for is a commercial changes And us market are with but time. make continue

positioned to differentiation growth strategic Rollins of a by further are points of and achieve organic M&A. level healthy have These complemented

opportunities Looking and are executing about recent well Control, ahead Fox the the Pest Fox track. of teams at doing remains we integration on growth The acquisition the continue brand. to for excited Fox be the and

acquisition months of year, closed tuck-in M&A deals Fox. and addition and evaluating X healthy first the this domestically both we're through internationally. Additionally, we opportunities, remains actively in The to XX pipeline

are invest evaluating strategic As component across recurring are organic the highlighted while confident position right growth. disciplined remain in to expand an ability opportunities strong market efforts I've acquisitions the We our growth also while in helping M&A organic business. us our to accelerate in delivering in continued the important in complementing past, acquisitions and

Our an culture. dedication part our to and important is continuous improvement strategy of

our our to levels took previously, us constantly looking our heard Support As important to growth increased we August, In step an you've operating goals. in service discuss efficiencies. towards efficiencies improve Center and accelerate we're Atlanta

time modernization first our priorities and structure. savings reinvest we our frontline more flatten and the plan efficiently. We to further program support that restructuring to cost and efforts operations serve to designed enable our in us that executed a overhead was initiatives allow our For years, XX growth about

margins in opportunities our the the as address move strategy. quarter we expansion to Ken and shortly. detail continue see more We provide for and forward will margin execute

us has staffing talent on into teams. a growth, put in energy Operationally, in of high and we in as and Effective we're been helped well customer-facing functions developing year-to-date. great and and side to both both organic strength of in as people committed the achieve capitalize our of and the right healthy the to Hiring levels onboarding quarter lot our business. investing service continued sales demand support

remain We I'm year. focused report average that we on safety and increase driver our score of the pleased seen beginning XX% have safety since to the Mentor over

and we driving this of done something activity in have to negative overnight claims an derived a encouraged our that that motion. that's app behaviors to Improving a culture recall strides financial You'll had we results versus are our implemented vehicles isn't ago. that when is but driving monitor less the safety score from impact are we're making year our

increase safe and negative our We impacts that training safety are while and our are rewarding safest. financial believe We keep those the hard and to to business. recognizing mitigate working will in people these the awareness field efforts

We returning increase continue value sustainable XX% dividend creating growing and to we be remain focus dividend. by a capital on a to shareholders. position committed our to to and to We're our in pleased and

completed Additionally, $XXX in the third quarter, million in share we repurchases.

participate expanding additional Ken the modernizing year flexibility earlier by to opportunistic in at on made some price. and our this a and will attractive refinancing this structure, we very revolver us repurchase a our a share capital moment. details in gave moves be The in

front look but developments yet. And quarters. the this forward progress to to continue not efforts modernization done sharing additional on we're we coming over well Our

on before and organic year closing, attract, Ken, call In talent are where robust hire and of our for the focused very the incremental stands top I about business retain growth, and across positioned to over remain well business. the excited to we We're turn remainder today. healthy margins delivering the continuing

turn Ken. I'll the call now over to

Jerry good Thanks, and morning, everyone.

reflects by execution quarter Rollins' strong third team. continued The the

with a Let me highlights. begin few

revenue saw total our of service Acquisitions other of good growth We year-over-year. Organic over growth. revenue the delivered growth offerings. was of across up XX% X% drove the over we First, robust revenue X%. each

healthy, this Second, quarter. margins approaching our XX% were gross

continue strong, margin to be good on the key XX.X% We XXX several of across was leverage points EBITDA driven saw improving and the basis performance price cost equation categories. positive P&L. cost Adjusted by across

earnings excluding expenses and to were that to per $X.XX earnings costs mentioned, restructuring the XX% adjusted related the share up share. GAAP Fox certain for Jerry per just and acquisition Our $X.XX severance per share were

least, not of $XXX million Cash timing both versus certain of free million, up last the flow quarter by payables slightly $XXX flow payables, of cash operating year. but of and payment delivered last And at cash the flows we were impacted end.

revenue a up at basis. second above levels. Let's $XXX improving bit this look at more XX was Currencies a by quarterly basis healthy reported little growth detail. results very the quarter revenue from the points. growth was in reduced XX% revenue quarter, Quarterly on Organic X% million,

Fox, notably services value continue quarter. our deliver to good third for most We our in and see continue to the demand acquisitions,

XXX-basis more in a offset as realized than point pressures. we inflationary to Turning profit margin profitability, gross pricing improvement

of gross to in organic by While accretive points, Fox basis we about in basis saw points margins improvement XX the was quarter. margins XXX

Setting associated a of basis the pressure aside costs, vehicles lower people versus than experience of well more in materials saw favorable from of with improvements fleet due and supplies and XX the leverage on points from ago. the we margin contribution year more gross as leased Fox, as gains sales claims improvement to as offset

basis percentage year. We as of brands cost the in points of provided decreased across pricing discipline quarter. of a we are by services pleased more from to continue our this consistent benefit leverage XX to with all revenue costs our ability as a our SG&A

Excluding quarter. Fox SG&A decreased acquisition, points the XX earn-out in for revenue by basis costs as the of percentage adjustment the a

and spend. the negatively associated our Margins saw by to and bit advertising and claims along experience business. back on we with growth and insurance improved our leverage up advertising make costs benefited expenses Peeling we of increased were selling invested drive costs, people but people our in a bulk selling the more, year-over-year SG&A as SG&A impacted with layers costs, claims

that employee executed As efforts. in Center further at Atlanta XX% a of operations. and further back-office we for shared increase program services people we intend associated of Jerry savings support and modernization can impacted change a better, our efficient Support time first become more to to years, work restructuring we systems our population productivity as in provider mentioned, Roughly reinvest drive both was frontline our for cost XX our and to the

to As consideration the and items. acquisition-related were $XX related and amortization earlier, for totaled adjustments Atlanta value accounting the restructuring severance Support the and non-GAAP contingent I purchase acquisition. on costs for basis primarily pretax Fox fair Fox quarter had along costs a on Center million with of mentioned These this approximately we

XX% was XX% EBITDA a million, was XX% revenue healthy year-over-year. and up year-over-year on operating $XXX income GAAP income $XXX was million, XX% year versus up total growth. Adjusted margin million, approximately $XXX prior the operating was XX.X%. EBITDA up

the improvements Margins XX% was over representing points primarily XX.X% Our a basis gross up ago, and to discussed in million, versus XXX $XXX adjusted year EBITDA up margin. margin related a previously. were

Fox coming of XX year the the was neutral adjusted in basis Year-to-date, EBITDA margins that quarter. our ago, margins from versus Fox with improvement acquisition. a EBITDA to points points improved basis XX

was points basis XX driven across this, of the Excluding the remainder business.

have dollar costs and margins of look additional to margins of we the additional at XX%. basis, what costs XX% percentage associated indicated, acquisition, as-reported revenue On with on growth generated to or using over meaning earn-out As the and recent almost EBITDA. incremental every incremental excluding an we incremental consistently converted we the margins were restructuring of our like business is the

adjusted increasing $XXX an share income per as-reported XX%. basis ago. a same $X.XX incremental share, period And XX%. year incremental was from almost the of on generated margins we million per net in were an or margins GAAP on $X.XX over Quarterly Year-to-date, basis,

Adjusted $X.XX points up X per well, months, income the XX% over and or share. was by The quarter effective taxes. XX% $XXX ETR basis higher approximately compared the for rate tax was as million the with driven XXXX was first XXX income net in foreign

the cash flow cash cash generated remained ago. free and a versus $XXX We sheet. year Turning Quarterly in $XXX million balance million quarter flow to healthy. of free the flow

discussed, previously quarterly primarily sales. was free related by As of payables impacted timing to cash the flow door-to-door certain our

million, of year. versus an free increase XX% flow Year-to-date, last was cash $XXX

below X.X repurchase of and acquisitions million this repurchased dividends totaling million we made million completed We million. a at a shares we quarter, our We purchase. share. $XX revolver $XXX the share and $XX paid used $XX to During fund in

first the year. expect be Xx accretive a is gross results and the net remains in this second We on less and X% minimally level. below debt-to-EBITDA and in to than dilutive to Debt negligible year

enabled us flow a strategy balanced has Our strong very year. profile to allocation cash capital this execute

acquisitions, increase in shares Year-to-date, of we million have $XXX XXX and invested million $XXX ] paid approximately million repurchased year-to-date. dividends, in a [ our XX%

dividend Additionally, of we XX% This payments. another X annual to this dividend decades over consecutive just in announced increase cash marks increases week. our earlier

active very approximately in markets. and additional of and fragmented be million at in very remain highly invested the market a continue and in we We to participant disciplined. pursuing we $XXX active acquisitions. we multiples, remains acquisitions remain Year-to-date, acquirer looking And choice an our have

In and closing, our the demonstrate the strength of of level quarter our engagement this business to performance continues team. our model

driving improvement customer organically continuous growth of profitable our disciplined we across best on both and focused We experience through remain the focused and business. driving growth, brands acquisitions. are family Our the on with and are customers providing

turn I'll that, back Jerry. With the to over call

Thank you, any to take We're questions time. Ken. this happy at

(sic) from [Operator RBC Our [ comes the Sabadra Instructions] Ashish Sabadra with first Capital of ] question Markets. line Anish

environment. but talked better you multiple was just see about business. different to the strong demand but good seen demand new obviously And being consistently about wondering a seen you you you attract -- have you It's underlying certain talked just obviously another? And on selling strategies Have Can the in wanted to on I if environment? comment any to the strong -- momentum focus better the avenues in versus I slowdown understand. month-to-month could you customers.

this is -- think Jerry. I

to plays was some the seeing someone's our And especially side. not at slightly for side, or digital. whatever a acquire for maybe business. in think that's you is that's case, digital of on customers digital always people look driven differentiating our down have for really relatively When think us. strategy entire where flat the the I market lots it by how the approaches even factor demand we And

think, I So really while strategy certainly, downside, paying is was us. flattish for the slightly to off segment diversified on our digital the what's

consistent at The only a quite on we basis the would X business of is just One, Yes. across family the points. our broad-based only quarter, there, I brands. of thing growth broad-based the not look in saw a but quarterly growth saw When across add business we the I impressive. all growth growth,

So that was first. see good really to

see And into of October. might lot business a we you demand hurricane October, went a second, And pushed to continue as healthy we ago, we in get and if a year a exited the level. quarter season from really into recall, tough really September saw

into we of also think So as a gives the see to momentum good us optimism about bit October future.

North of only done and also doing important brand doing we've that is America U.S. it's businesses brand particular, that mention strategy from what but are a they're what well. think see a I to also and the individual quite across, we all seen say, -- Canada, our in not geographic from well -- strategy, across all geographically really

my about That's follow-up, that on great just incremental XX%. of solid talk And color. seen I wanted the maybe margins to we've

As think should that going you've forward? to XX% margins the efforts we on, modernization worked the XX% we going incremental sustainable that about about how think forward? Is

I incremental is a to our would focus it's deliver very What question, Yes, great healthy say a Ashish. profile. to is, continue margin

were This quarter, that XX%. correct we saying in you're

a level we go XX% continue multitude certainly to continue ability as EBITDA lift into We depending on have XX% future. to confidence of XX%, to in factors incremental continue see that deliver of our a and upwards an to see incremental margins margin margins, deliver opportunity the to to XX% we but

a service. in on It's business, -- business. office. It's got we're great our It's and improvement in continuous across an just pricing focused our not essential back our

very continue to incremental profile. margin So points, we with focus a on healthy all delivering those

on solid the congrats and color great That's quarter.

of Our America. from the of with Vicky next line Liu question comes Bank

as To Vicky more you This see? you usual from any I'm it price is X% just or have Haas. is the start pushback increase as curious, on seen for Jason off, business

from been very we've increase environment what has Price increase. a of a standpoint been price healthy -- seen it's as

in might other see see where challenges codes see zip you but challenge see codes certain may don't you zip that all. much at you You

see So -- but essential we a overall, for environment services. it our as very healthy

your Yes. to you price And similar then take think follow another in can scale up, a increase do on XXXX? customers

learn? in of the we increase the We're We're our from update create Jerry. tuned. that strategies you a next some point at first would the -- did What is or at and we end price last when And results you start our We're say, I X here look months to advice quarter. the on be really data, for in my XX to going -- year. And going that. to what stay to best probably evaluate taking fourth guess quarter happened? We'll this

comes Our next Mulrooney question William from the with of line Blair. Tim

Two quick ones.

the down second of So this up get the trended acquisition, and digital it channel flat Jerry, on response customer your how first to the I in on consumer Was kind you that a year? the question, is, for channel through in trying said is to to new? sense quarter. in third My that question another Just was quarters has this year. of in particular think demand

the that I a consistently. I had it see downs. others months We prior as There double-digit some of months in level some at somewhat but the wasn't would a -- it better year. increases better it X didn't up say wouldn't first up. significant may characterize very something year was ups higher sort of higher have -- -- than we than and are

And where that X double-digit decrease character out almost July. was, rebounded in of we in June saw but for just then then was those sort really it it June, that, of weeks is that

a So months consistently say pretty in to over dynamic I summer flat little it's been few volatile would of year-over-year. but and then terms little the stabilize it's seem the now a is over the maybe word past bit

I know or XX I the months. think of that X but last if don't helps story So that's the

trends. your helpful. there figure lot on extremely out it trying at to looking folks own out There's that's and of No, their a

for helpful. fully which you channels acquire just have different in you thanks it is from detail then on And appreciate very that customers hearing that. but many the so And directly you

for about curious Customer I'm to in digital over the you're I narrowing, ask risen like I want know time, channel, other if customer The acquisition is have acquisition thing just it's costs. they costs more everybody, digital I extensively in in so, you guess, and usage the plan channel do future a seeing DXD of expand the cost to customer between gap door-to-door? periods? And acquisition of if that

have is space. as mature is control the pest we've more trend that something seen -- yes, more and companies in digital that So more that a gotten

those like of for We pass cost -- to higher say, in the things Googles pay-per-click, the along along world have things of be to us seen, terms able especially lines.

So -- you through, year-over-year because also search those say or as a through larger do throughout flat X% in well lines, achieve perform can brands of or you point demand have or want along the of is it's see activity. take rise. like And Google digital some down at great they of And our share market. certainly data marketing mean that to the Orkin other teams, and just demand dollars more out, we that I some something or that spent that, doesn't as company a can't something with that

over to and door-to-door cost certainly makes your But that an years, that several increase over certainly between original question, have last in digital the gap customer acquisition time, of digital back we seen narrower.

the a side. up you is And all selling it that and if dense model when especially when model be consider so you're metropolitan because door-to-door picking you working door-to-door a you populations right sell than, and say, dense, over think in a you digital onesie-twosie pretty on more look can at the from you that and good coming stuff density area they're neighborhoods

from it's the door-to-door strong be more though little -- factor bakes it's offering may you that when in term, standpoint upfront, bit it well. long a efficiencies as So really long-term money a a even

line Chan from comes of UBS. question next Josh Our the with

customer quarter. acquisition I a ask good I guess wanted on I the to split, guess. Congrats about

ways what call you door-to-door this they you of a but give and the digital typically I just in? channels mentioned mostly -- acquire on come could customers, on us like ballpark rough You that guess how through

what percent through which come channel? asking you're like Josh, of customers

Yes, exactly.

that don't really information. we Yes, disclose

digital much door-to-door. comes more or comes from would larger comes channel, But a I portion door-to-door outside today, through of that say than

to they know the There's awareness agents, customer the when They digital. us There's automatically our Yes. ring phone where know call makes they our name, our seen phone consumer make Google call name brands. and see search to that they and do the call. to never they've they Right? because go neighborhood the have and a phone they number, in our our vehicle

a So channel. of is powerful the still word mouth

So like all important is play an but well. over-rely it's also part. into drive really on don't digital But come it things that to those we to that as certainly

Right. That sense. makes Right.

Okay.

of And deal we sales. you're learn also the think one of is sell. technician when business technicians not We put you that your a staffed, about don't this in great emphasis. things And

So they're they're the not swamped if too sell too -- to And them. it's little to when want work work more that are for job to with because -- hesitant to much to if down going talks be them, they somebody to go they're road out. that do, new when just a less going

staffed But technicians and when you're at engaged. your get staffed you're levels, healthy

So see in levels activities increases better staffing we well. result our our and as of technician as their sales a

these all that it's acquire So ways can customers. we

there a I And Right. things, kind of side what guess, expect restructuring on generate from think about the to payback savings cost? period efforts? of is And to you those then of way the the

to associated attractive with of the Yes. It's at compensation to of spend, that. $X-or-so $X million million the payback, probably million spend, there's When $XX an you look close Josh.

payback been X-year very So is a has my experience acceptable.

You with can restructuring associated spend the a payback see a here. X-month and

if at the said, as I you on that prepared well. commentary, we're think look reinvesting focused With

off talent all is the and accounting; there folks IR, new call so And an IT, talent, to of across reinvest of other as opportunity today, we're And significant in kicked well. Lyndsey. Head in like She new back-office making functions. our changes new new finance

modernize we we So do do improve, how the what do. at we're upgrade looking how talent, how we we do

take $X that to of million. reinvestment of million going $XX that to is some some And

the Stifel. with Our comes Shrestha from next Aadit question line of

quarter strong Congratulations on again. a

spread, And how related? the was do it talked we related still just through inflation? internal that, trended this you price Is the it cost remains fleet how positive. year? -- to what kind So predominantly cost about And has actually of

around versus about or was XQ has think do trended we basis of the XXXX? it year XX XQ? how How And remainder it into points. and that think for I

So it's Ken.

take that question. I'll think I

price/cost to is positively positive equation. focus -- the Our continue manage to a have

If at look on materials cost input our you on is services percentage a fleet. cost of our large in people business, costs, the the provided, and

and For the throughout those most in for some If part, done to good was to over the of efficiency really improving costs go XXXX. example, leveraging we've improvements that at I a margin, saw job back related QX, Fox. we

We headwinds, improved X remember, from casualty you But similar those the reserve. margin when in also the separate quarter. had if to you saw second saw this quarter, we we what

saw quarter costs. with this improvement casualty and outsized the we What claims was insurance associated

insurance back you claims. to very talking the If go in transparent quarter, in about headwind with very last were a year, unfavorable associated third we and

So equation. we continue last improvement the to able on is to to positive But saw see from be year. we focus our cost price what were

see leased only on the talked headwind in of that to QX we our We that related of in quarter within We gains did to highlighted fleet, vehicles. we we offset in here that about organic sale Really, saw and seeing and be the able that but would actually the in specifically QX. cost were fully was improvements. lower was it which some see

we And in improvement continued margins go focus, forward. so the as that's

big just flow to payment free make it XX% to of and brought XQ And sort a I you conversion out a -- follow-up, you conversion. there as had a think was cash in payment pointed down

historically XXX%. averages XXX%, around around it year-to-date, you're think tracking I

back expect it how And conversion XXXX sort year? more think actually that how up So and and beyond like of the for you get XXX% you into can picks about this to do term, XQ long improve? much XXXX, maybe do we

capital that's Yes. It's business a light. very

investing to capital, working look has the X% benefits XX%. it's cash enjoys when flow profile, XX% so compounding cash in and has little you X% to been flow And hard very and CapEx a to that at business find that's the at of

income. is do of teen XXX% above compound how net to at range? our continue do income earnings to net we in cash just How So convert that focus that, we and continue flow

payables We down impact. the The as come third paid quarter saw we We had considerably. third closed payables an quarter. some out

that focus QX into our beyond. to improve go And is we as and

on that compounding focus. continuing of in so the We're flow be I and continues levels And ranges high performance driving to to previously our discussed. focus cash

[Operator next the comes line Instructions] Moore question Stephanie of Jefferies. with Our from

on This is Antor Moore. for Harold Stephanie

quick you professionals. And in XXXX, increased I question, the did how the hiring weather then know a in -- and sales does [indiscernible]. quarter how So guess of did also I trend the

individuals on are that organic how impact So at full in productivity? the And those quarter? does growth

on Jerry, So the Harold. -- is this

On the a through Last of pretty end particularly year, weather mentioned, we weather came had -- affected side, Southwest South good it we at September, a and that quarter. as the hurricane had Ken Florida.

didn't we So have of that type event.

So I favorable. would as generally categorize it

we've we've in make the growth, at investment investments the helping And the really standpoint certainly, of and then lot of the getting been effectiveness opportunity And efficiencies sales we're we've termite of into commercial we we've our making that and very is quarter business. a been more the our alone looking the year the It's added brand XXXX, in managers Orkin those last over at account a it some you great investments third ancillary the -- drive salespeople, when us over -- the sales over sales our And over of that past months. that those to added. commercial XX the XX growth, as that space. hiring result look us of we've degree, and We see commercial from the relates side in a that's productivity that's the commercial you look And helping effective. back residential teams an made both to the are growth. commercial and

just then on M&A. And

willing PE sellers, market? to more you companies Given are then, similar or are more are uncertain acquiring acquisition where Pest your are you Control companies that interest guess, seeing ] for rates And much the like? I more is traditional in market, door-to-door an strategy, in [ Fox how

seeing continue in the And still to are still flow us businesses at we're good. the strive -- selling to that market. growth in our to help help and types positive -- accretive still that model, our help that us open everything in that to interested grow that looking healthy pipeline businesses their all We're the remains are margins, Businesses owners are are achieve, us going fit way. we pattern a of

So Ken? side you add would that, very it What positive. that of to seems still

I Yes. is acquisitions. what we on everybody raise One add on, always is is focused price. are to The to thing pricing, we that. I points which respect Two for only paying don't with want compete would

business being of ready long brand a our been sell And people, When sell is very Our of we've and the their successful long successful period of a time. people business. on period their choice. time. of they're for they been very choice we've very to being and focused focus the to preservation very be acquirer for And acquirer the choice acquirer of to are

When the I at that acquisitions. $XXX we've look a business that long-term invested $XXX say the year, perspective. million we've overall million would this investment that below paid multiples is from for we in probably the multiples average

acquisition. what how that So through good we and feel we're competing driving spending, we're the success we're about

line Our next Mazzoni the John comes Fargo. question of from Wells with

have forward. growth And us sustainability reps about been again, the that of just really strategy added the of to as kind more double maybe kind of the also just talk on organic just vertical quickly is about on of but to growth the well click maybe you as anything kind targeted profile? commercial XX helpful technology -- the that just Maybe side. Could going accelerating talk

on about investments that highly customer more certain of tail -- commercial we've hospitals, like there on We last years, or really into side there. into our end coming like health much certain we talked we everything care, on that logistics, kind centers, commercial out our were warehouses, focus made the verticals the we few and as that to hospitality database that especially service we shows desirable and have and our sell things of don't the the are but of COVID So we research over distribution this verticals, want targeted verticals. we not know targeted

from a when BXB after on type and Orkin, And of them types on focused say, we're material and that going getting new, at bring standpoint. customers managers commercial those targeted account of really working we

really help BXB commercial helped more from warmer some like sell. also make make it's that them a the a productive a get -- side, So some productive quicker. Marketo I've salespeople that more us relationship and time. outside them discussed standpoint us our -- That's It our leads takes on have of and on tools

started and would So very long-term about payoff are great since to we capitalize once we of deliberate and an And COVID, we've that coming us this our view a approach the seeing you're that through results be backside we're, business of midway been on as probably this the that seeing to opportunity program now. on. and again, -- that's the long-term opportunity for COVID,

helpful very that are are creative very to we're certainly you -- talk we there innovative in and where those run, get that and to side, we the I we're like accelerating So growth, campaigns teams, lines. about of certainly, technologies, organic particular, demand. they marketing some when in don't into then using teams creating The terms where technology our strategies can technology, but and on automation. sales marketing that organic along are looking specifics teams I there's our assure using at

been players color. And And competition. then large players? Great just maybe there the perhaps you or touch has on in Have quickly either smaller in change regional competitive landscape? to any any pullback national seen

fragmented -- players still of there. out I market, and lots a it's competitive Competitively, highly it's mean healthy

competitive significant noteworthy -- seen change So competitive a no haven't probably standpoint there. that's we out or remarkable, any from still

Atlantic line next [ ]. from Redburn Our comes with the of David question Oliver

questions couple for a me. Just of

on end? of the sort of at witnessed is the and sort XX% movement about through call you rest QX sequential You the quarter mentioned July, of is the can about talk implies so months through X.X%, the organic quarter into you which just running growth in that that

And then between base? kind Are another cross-selling just margin. the into to one of give on customers before new gross able existing and organic growth split of customer a you

that to strategy. of level tell on it's and to the in detail track look multiple customer you second the a for at big to the part the one cross-sell of that profile is of I our reasons. strategy, multitude customers, always When is unfortunately of can certainly a important point business. we services you sell what -- enjoy with So respect have But do margin that not

to good continuing it's certainly see that so we're us. business. And And part momentum a focus be continuing to for in our of

from out you're strong sequentially as was to we saw more growth was But higher a historical rate, as was quarter, we July close of organic line quarter When August, month then pretty between well. September organic. July, it our with right, averages. It the Yes. a where look growth big the It in you through levels move strong remained too.

of don't thing that you hairs about the talked we look on when is would weak June. start and Yes. -- QX, The end to only we at I but to at want a split add QX

to And the so business of the a up out to some QX realm or and that number that reason in of question into pulled that in of out QX July it's have think may bit. of think not pushed

out -- ordinary there's -- at looking healthy that, with I other nothing was And so growth. than throughout. there's the It -- of but Jerry, really was don't that to respect

split just a mean, of organic cross-selling. between you can I growth and new give Sorry, customers

don't -- track been the there's provide We that healthy we don't But is It's I of you -- both to can to could growth is areas. you across I us. the -- of tell now. that don't right I a I that detail healthy. we for No. unfortunately, those point growth where mean, level healthy mean

And last Okay. EBITDA adjusted just on then year.

on reserve the was negatively casualty points basis XXX it by think impacted I increase.

you if that XX.X% sort I to of you year's versus quarter. the this So get delivered margin, last back guess add XX.X%

on a So you that pretty margin? just big drag moving is And can talk the parts? still about

with fact you're have really the that insurance the big that challenging. Yes. been The point is missing markets

is but continuing us. And insurance so are to [indiscernible] claims on thing one

look came And have through. QX negative costs at last on in insurance you the impact year, the come when that not year have did but claims come have -- so that this down. down those and you unfortunately But

basis in you the were aside, not that's really XX improvement reserve in saying transparent why underlying in we of the quarter in in seeing the good set improvement that the set XXX the and It's points you're we so And underlying improvement improvement basis the aside, margins on business. saw alone. the points Fox quarter, casualty you when

we ability to continue to we go pretty our good but forward. about -- feel improve margins So as

session. I'll management turn final and Ladies you. any floor comments. back for Thank to that gentlemen, the our concludes question-and-answer

We earnings you Thank for appreciate joining quarter to today. you, interest early in everyone, your look us call our our next again. on year. company updating we Thanks and forward fourth

you. call. today's concludes conference This Thank

for participation. at You you time. lines this your your may disconnect Thank