ABM Industries (ABM) Q4 2001 earnings summary

Executive summary

• FY2001 revenue and other income rose to $1.950B from $1.808B; net income fell to $32.8M from $44.3M, reflecting a mixed year and a $20M insurance charge.

• Engineering, Lighting, Mechanical and Security exceeded expectations; Janitorial met an ambitious budget, while Elevator and Parking had disappointing years.

• The September 11 attack killed 17 employees and affected the largest single job site; management said new business and insurance proceeds would mitigate financial consequences.

Financial highlights

• Revenue and other income was $1,950.0M, up from $1,807.6M in FY2000; operating expenses and cost of goods sold were $1,722.3M.

• Operating income before interest was $55.5M, including a $20M insurance charge; income before taxes was $52.9M.

• Net income was $32.8M vs. $44.3M; diluted EPS was $1.30 vs. $1.85.

• Operating cash flow reached a record $65.8M, compared with $18.9M in FY2000.

Outlook and guidance

• Management expected the market for sizeable industry acquisitions to grow dramatically in 2002, supporting its goal of becoming a market leader in each business line.

• The strong balance sheet and cash flow were positioned to support growth despite, or because of, the continuing recession.

• CommAir reported record backlog at year-end; no numerical earnings or revenue forecast was given.