ABM Industries (ABM) Q1 2025 earnings summary

Executive summary

• Revenue increased 2.2% year-over-year to $2.1 billion, with 1.6% organic growth and strong contributions from acquisitions, Technical Solutions, and Aviation.

• Net income was $43.6 million ($0.69 per share), down from $44.7 million ($0.70) last year; adjusted net income was $55.3 million ($0.87/share), up from $54.8 million ($0.86/share).

• Adjusted EBITDA rose to $120.6 million, with margin steady at 5.9%.

• Launched a new brand platform and implemented a cloud-based ERP system for B&I and M&D, driving efficiency and growth.

• Expanded and extended credit facility to $2.2 billion and repurchased 415,000 shares for $21 million; $133 million remains authorized.

Financial highlights

• Q1 revenue was $2,114.9 million, up 2.2% year-over-year, with 1.6% organic growth and the rest from acquisitions.

• Adjusted EBITDA margin remained steady at 5.9% year-over-year.

• Free cash flow was negative $123 million, impacted by ERP transition; normalization expected later in the year.

• Total indebtedness at quarter-end was $1.6 billion, leverage ratio at 2.9x.

• Dividends paid totaled $16.4 million ($0.265/share); diluted shares outstanding were 63.2 million.

Outlook and guidance

• Full-year 2025 adjusted EPS guidance raised to $3.65–$3.80.

• Adjusted EBITDA margin outlook unchanged at 6.3%–6.5%.

• Interest expense forecast increased to $80–$84 million due to higher debt.

• Free cash flow expected to normalize in H2 2025; liquidity and borrowing capacity remain sufficient.

• Management expects commercial real estate and other end markets to remain healthy, supported by a strong sales pipeline.