ABM Industries (ABM) Q4 2004 earnings summary

Executive summary

• FY2004 revenue reached $2.416B, a record; operating divisions delivered solid income growth, while workers’ compensation reserve increases reduced reported continuing income.

• A national service platform and cash surplus supported organic growth and an opportunistic acquisition strategy.

Financial highlights

• Sales and other income were $2.416B in FY2004 vs. $2.262B in FY2003; income from continuing operations was $30.473M vs. $35.624M.

• FY2004 diluted EPS from continuing operations was $0.61 vs. $0.71 in FY2003; net income was $30.473M vs. $90.920M, which included discontinued-operation results and a sale gain.

• Operating cash flow from continuing operations was $64.197M in FY2004 vs. $53.720M in FY2003; cash and equivalents ended FY2004 at $63.369M vs. $110.947M.

Outlook and guidance

• Strategy calls for stronger organic growth capabilities and continued aggressive but sensible acquisitions as the economy improves.

• Management expected the combined Facility Services operation to make further progress; CommAir entered FY2005 with a stronger maintenance base, while Amtech reported recent performance improvement and expected a turnaround.

• A planned 2005 Voice Over IP network was expected to improve service, centralize support and reduce operating and travel costs.