The ServiceMaster Company, LLC Reports Preliminary Fourth-Quarter and Full-Year 2013 Financial Results
- Revenue increased 6% to $713 million
- Pre-tax net loss of $23 million; 11% decline versus prior year
- Adjusted EBITDA(1) increased 9% to $90 million
- Revenue of $3.2 billion was flat to prior year; 8% revenue decline at TruGreen offset 4% growth in remaining businesses
- Pre-tax net loss of $627 million included $673 million of non-cash goodwill and trade name impairment charges related to TruGreen in second-quarter 2013
- Adjusted EBITDA decreased $95 million to $476 million; $127 million decline at TruGreen more than offset growth in the remaining businesses
- Company completed the spin-off of the TruGreen business from the ServiceMaster portfolio on January 14, 2014
February 27, 2014 // Franchising.com // MEMPHIS, TENN - The ServiceMaster Company, LLC, one of the world’s largest residential and commercial service networks, today announced preliminary unaudited fourth-quarter and full-year 2013 results. The company reported fourth-quarter 2013 revenue of $713 million, an increase of approximately 6 percent compared to the same period in 2012. The company reported full-year 2013 revenue of $3.2 billion, relatively flat compared to the same period in 2012.
The company reported a fourth-quarter 2013 pre-tax net loss of $23 million, versus a pre-tax net loss of $20 million one year ago. The company reported a full-year 2013 pre-tax loss of $627 million. This compares to a pre-tax loss of $827 million one year ago. Both periods included goodwill and trade name impairment charges at TruGreen, $673 million in 2013 and $909 million in 2012.
The company reported fourth-quarter 2013 Adjusted EBITDA of $90 million, an increase of $8 million compared to the same period in 2012. The increase was primarily driven by the impact of higher revenue in fourth-quarter 2013 and lower claims costs at American Home Shield, partially offset by higher selling expenses to drive growth, primarily at American Home Shield and discrete charges at Terminix. The company reported full-year 2013 Adjusted EBITDA of $476 million, $95 million lower compared to one year ago, driven by the $127 million Adjusted EBITDA decline at TruGreen, which more than offset the Adjusted EBITDA increase in the remaining businesses. A reconciliation of net loss to Adjusted EBITDA is set forth below in this press release.
"Excluding TruGreen, our fourth-quarter and full-year 2013 financial results for the remaining portfolio met our expectations," said Rob Gillette, ServiceMaster’s chief executive officer. "We’re pleased that Terminix, American Home Shield and ServiceMaster Clean all reported full-year 2013 revenue and Adjusted EBITDA growth versus prior year."
The separation of the TruGreen business from ServiceMaster as a tax-free spin-off of TruGreen through a pro rata dividend to the stockholders of ServiceMaster Global Holdings, Inc., was completed on January 14, 2014.
"This separation should enable ServiceMaster to concentrate on growth and realize our full potential faster," said Gillette. "We believe the future for the remaining ServiceMaster portfolio is compelling. We have great businesses and great people, and we’re committed to taking the steps necessary to continue to drive both revenue and bottom-line growth."
Fourth-Quarter and Full-Year 2013 Earnings Conference Call
The company will discuss its fourth-quarter and full-year 2013 operating results during a conference call at 8 a.m. central time today. To participate on the conference call, interested parties should call 800.732.5617 (or international participants, 212.231.2902). Additionally, the conference call will be available via webcast. A slide presentation highlighting the company’s results and key performance indicators will also be available. To participate via webcast and view the slide presentation, visit the company’s investor relations home page at www.servicemaster.com.
The call will be available for replay until March 27, 2014. To access the replay of this call, please call 800.633.8284 and enter reservation number 21707691 (international participants: 402.977.9140, reservation number 21707691). Or you can review the webcast on the company’s investor relations home page.
For full segment review and forward-looking statements, please visit the Investor section at ServiceMaster.com.
With a global network of more than 7,000 company-owned, franchised and licensed locations, Memphis-based ServiceMaster is one of the world’s largest residential and commercial service networks. The company’s high-profile brands are Terminix, American Home Shield, ServiceMaster Clean, Merry Maids, Furniture Medic and AmeriSpec. Through approximately 13,000 company associates and a franchise network that we estimate independently employs over 31,000 additional people, the ServiceMaster family of brands provided services and products to approximately 5 million customers during the last 12 months. The company’s market-leading brands provide a range of residential and commercial services including termite and pest control; home warranties and preventative maintenance contracts; on-site wood furniture repair; home inspections; home cleaning; janitorial services; and disaster restoration. Go to www.servicemaster.com for more information about ServiceMaster or follow us at twitter.com/ServiceMaster or facebook.com/TheServiceMasterCo.