Slide 1: Investor Presentation Second Quarter 2021
Investor Presentation SECOND QUARTER 2021 1
Slide 2: Agenda
Agenda 1 Business Overview 2 Responding to COVID-19 3 Making a Difference 4 Second Quarter 2021 Review 5 Capital Structure 6 Fiscal 2021 Outlook 7 Appendix Forward-Looking Statements and Non-GAAP Financial Information: Our discussions during this conference call and in this presentation will include
Slide 3: Business Overview
Business Overview ABM. Building Value
Slide 4: Who We Are
Who We Are PURPOSE To take care of the people, spaces and places that are important to you VISION To be the clear choice in the industries we serve through engaged people MISSION To make a difference, every person, every day
Slide 5: Founded in 1909 | $6.0 Billion in Revenue +100,000 Employees
Founded in 1909 | $6.0 Billion in Revenue +100,00 Employees . 5
Slide 6: Building Value Through Industry Expertise
Building Value Through Industry Expertise Keeping your environment safe, clean, comfortable and energy efficient through individual or integrated solutions Aviation Business & Industry Education Technology & Manufacturing 6
Slide 7: Industries We Serve
Technical Solutions (8%) Industries We Education (13%) Serve Business & Aviation Business & Education Industry Industry (52%) Technology & Manufacturing (16%) Technology & Technical Manufacturing Solutions Aviation (11%) Results as of fiscal 2020. 7
Slide 8: Services We Perform
Services We Perform Aviation Business & Education Industry Technology & Technical Manufacturing Solutions 8
Slide 9: Targeting the Outsourcing Continuum
Targeting the Outsourcing Continuum Aligning workplace strategy with operational best practices for improved cost efficiencies, productivity, communication and scalability SAVINGS Majority self-performed services maximizes Impact to operating costs through SOPs, labor energy and asset alignment with
Slide 10: To make a difference, In Summary...
To make a difference, In Summary... To take care of the people, spaces and places that are important to you To be the clear choice in the industries we serve through engaged people every person, every day Electrical Lighting Facilities Engineering
Slide 11: Responding to COVID-19
Responding to COVID-19 11
Slide 12: As with most companies, COVID-19 has impacted our business
Impact felt across our national footprint… This is a dynamic, rapidly shifting environment – with significant externalities Varying safety mandates managed by city/state As with most companies, COVID-19 has …and among our various end markets impacted our A “new normal” for office occupancy and trend
Slide 13: We took rapid action
We took rapid action | Our agile, …working in lockstep to action-oriented teams… take coordinated actions across Operational Capture cross- functional input Response on latest COVID Team developments Our people Activity Our clients / Field Execution Actively managing our Tracking operations people,
Slide 14: Potential opportunities in a post pandemic world
New and increased expectations for workspace and building cleanliness and disinfection as well as air quality Rising demand for service volume and frequency Potential opportunities in a Focus on higher value-added services, such as post pandemic world EnhancedClean™ and EnhancedFacility™, to meet ne
Slide 15: Validated by Our Clients
Pulse survey of ~200 clients conducted in February 2021 across all industry groups Clients are expecting to re-open by September 2021, with reduced capacity Despite increased usage of flexible work schedules and work from home, clients expect the total amount of space used to remain roughly the same
Slide 16: Client reentry plans and long-term outlook on space utilization
Client reentry plans & long-term outlook on space utilization remain focused on instilling occupant confidence Demand for space Our clients want a ...and expect to continues to be frequent and visible continue heightened strong presence of cleanliness… precautions into the future 89% 87% 84% ABM cli
Slide 17: Clients have put measures in place focused on surfaces and facilities
Clients have put measures in place focused on surfaces and facilities, and are more reliant on large partners 8 out of 10 clients expect to continue cleaning and … and this is consistent across nearly all industries and disinfection for years… types of facilities 40% 50% 73% 75% 79% 84% Yes 89% 91%
Slide 18: EnhancedClean program three-step approach
ABM’s EnhancedClean™ program is a three-step approach that delivers healthy spaces under the guidance of experts 3 Key Differentiators Processes Backed by Experts Hospital Grade Disinfectants & Specialized Equipment Innovative Solutions and Technology 18
Slide 19: Safety You Can See
Safety You Can See Building brand trust through visual assurance throughout the day 19
Slide 20: ABM EnhancedFacility
ABM EnhancedFacility™ ABM’s EnhancedFacility program delivers healthier indoor air and more efficient operations to take care of what’s most important – the health and safety of the people in your spaces. KEY DIFFERENTIATORS: • Fact-based approach based on expert-backed Healthy Building Risk Assessm
Slide 21: Getting back to moments like this requires...
Getting back to moments like this requires. . . A BUILDING HEALTH RISK ASSESSMENT TESTING AND VALIDATION HVAC SYSTEM OPTIMIZATION & PREVENTATIVE MAINTENANCE DISINFECTING LIGHTING SOLUTIONS A NEW NORMAL TOUCHLESS FIXTURES AND DOORS ENERGY EFFICIENCY UPGRADES BACK-UP POWER ABM’S PASSION TO MAKE A DIFF
Slide 22: Our Post-COVID Future | ABM strengths
Our Post-COVID Future | ABM strengths will drive advantage across markets Scale advantage These advantages are core Engaged people components of our market strength Results oriented operating culture today and will continue to propel Comprehensive service lines + EnhancedClean™ us into the future De
Slide 23: Making a Difference
Making a Difference ABM. Building Value
Slide 24: Our Culture, Our Values and What We Believe
Our Culture, Our Values and What We Believe It starts with us We believe making a difference begins with our team—creating an environment that enables every person to feel connected, valued and inspired. Together, we bring this mission to life with all those we serve. We are Our core values We striv
Slide 25: Turning Action into Impact
Turning Action into Impact Creating an inclusive culture where we all belong We’re committed to ensuring that everyone, from every background, can be seen, can be heard and can feel like they belong at ABM. Our first step was establishing a team member-led, executive leader sponsored Culture & Inclu
Slide 26: The power of partnership
The power of partnership ABM philanthropic partnership opportunity – Culture & Inclusion Council Equality as an Area of Focus Equality in the workplace means all team members receive fair treatment. There is transparency and everyone knows what to expect in terms of rewards and consequences. Equity
Slide 27: Doing business in a responsible way
@ ABM. Building Value DOING BUSINESS IN A RESPONSIBLE WAY Ensure the compliance with ethical business practices across our entire value chain; bring sustainable services to market that positively contribute to our clients’ environmental performance; and engage with the local communities where we ope
Slide 28: GreenCare Program
GreenCare Program Strategic partners on fighting climate change ABM is strongly committed to adding value to clients through our sustainable solutions portfolio We have designed solutions to increase waste diversion rates from landfills, conduct energy efficiency retrofits, install on-site generatio
Slide 29: Second Quarter 2021 Review
Second Quarter 2021 Review 29
Slide 30: Second Quarter 2021 Review: Revenue
Second Quarter 2021 Review Q2 FY21 Revenue $1,496.0 $1,497.4 2020 2021 30
Slide 31: Second Quarter 2021 Review: Income from Continuing Operations
Second Quarter 2021 Review Q2 FY21 Income from Q2 FY21 Adj. Income from Continuing Operations Continuing Operations¹ 1 1 $31.1 $0.46 per share $55.5 $40.4 $(2.05) per share $0.60 $0.82 per share per share $(136.8) 2020 2021 2020 2021 31 1 Please refer to the appendix for a reconciliation of GAAP to
Slide 32: Second Quarter 2021 Review: Net Income and Adj. EBITDA
Second Quarter 2021 Review Q2 FY21 Q2 FY21 Net Income Adj. EBITDA¹ 1 $0.46 $106.6 per share $91.0 7.1% $(2.05) 6.1% margin per share margin $(136.8) 2020 2021 2020 2021 32 1 Please refer to the appendix for a reconciliation of GAAP to non-GAAP measures.
Slide 33: Second Quarter 2021 Segment Results
Second Quarter 2021 Segment Results Business & • Revenues of $796.2m vs. $785.6m last year Industry • Operating profit of $85.3m, operating margin of 10.7% Technology & • Revenues of $246.3m vs. $233.7m last year Manufacturing • Operating profit of $26.9m, operating margin of 10.9% Education • Reven
Slide 34: Capital Structure
Capital Structure ABM. Building Value
Slide 35: Select Cash Flow and Balance Sheet Items: Revolver and Leverage
Select Cash Flow and Balance Sheet Items Revolver Drawdown Leverage Revolver Paydown GCA* $1,600 4.50x $1,400 4.00x 3.50x $1,200 8 Solutions 3.00x Westway (in millions) $1,000 2.50x $800 2.00x $600 1.50x $400 1.00x $200 0.50x $0 0.00x Total Indebtedness (Incl LC's) Leverage *Acquired GCA Services Gr
Slide 36: Select Cash Flow and Balance Sheet Items: Shareholder Return
Select Cash Flow and Balance Sheet Items Shareholder Return $30.0 IN MARCH 2020, THE COMPANY SUSPENDED ALL FURTHER SHARE REPURCHASES $25.0 AS THE COVID-19 PANDEMIC DEVELOPED $20.0 $15.4 (in millions) $15.0 $11.3 $10.2 $5.1 $9.7 $7.9 $10.0 $12.7 $12.7 $5.0 $11.1 $11.5 $11.5 $11.5 $11.5 $11.9 $11.9 $1
Slide 37: Select Cash Flow and Balance Sheet Items: Annual Dividend
Select Cash Flow and Balance Sheet Items Annual Dividend HISTORY OF CONSECUTIVE DIVIDEND SINCE 1965 (in millions) 2Q21 M A R K S T H E 220TH C O N S E C U T IV E Q U A R T E R L Y C A S H D IV ID E N D 37
Slide 38: Fiscal 2021 Outlook
Fiscal 2021 Outlook ABM. Building Value
Slide 39: Fiscal 2021 Outlook
Fiscal 2021 Outlook Prior Revised Metric Guidance Guidance Income from continuing operating per diluted share¹ $2.85 - $3.10 $2.85 - $3.10 Adjusted income from continuing operations per diluted share¹² $3.00 - $3.25 $3.30 - $3.50 Adjusted EBITDA Margin³ 6.6% to 7.0% 7.0% to 7.3% Tax Rate (excluding
Slide 40: Appendix
Appendix ABM. Building Value
Slide 41: Forward Looking Statements
Forward Looking Statements This presentation contains both historical and forward-looking statements about ABM Industries Incorporated (“ABM”) and its subsidiaries (collectively referred to as “ABM,” “we,” “us,” “our,” or the “Company”). We make forward-looking statements related to future expectati
Slide 42: Use of Non-GAAP Financial Information
Use of Non-GAAP Financial Information To supplement ABM’s consolidated financial information, the Company has presented income from continuing operations and income from continuing operations per diluted share as adjusted for items impacting comparability, for the second quarter of fiscal years 2021
Slide 43: Unaudited Reconciliation of Non-GAAP Financial Measures
Unaudited Reconciliation of Non-GAAP Financial Measures (in millions) Three Months Ended April 30, Six Months Ended April 30, 2021 2020 2021 2020 Reconciliation of Income (Loss) from Continuing Operations to Adjusted Income from Continuing Operations Income (loss) from continuing operations $ 31.1 $
Slide 44: Unaudited Reconciliation of Non-GAAP Financial Measures
Unaudited Reconciliation of Non-GAAP Financial Measures (in millions, except per share amounts) Three Months Ended April 30, Six Months Ended April 30, 2021 2020 2021 2020 Reconciliation of Net Income (Loss) to Adjusted EBITDA Net income (loss) $ 31.1 $ (136.8) $ 105.7 $ (108.8) Items impacting comp
Slide 45: Unaudited Reconciliation of Non-GAAP Financial Measures
Unaudited Reconciliation of Non-GAAP Financial Measures (in millions) Three Months Ended April 30, Six Months Ended April 30, 2021 2020 2021 2020 Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow Net cash provided by operating activities $ 125.9 $ 162.2 $ 171.2 $ 128.0 Ad
Slide 46: 2021 Guidance
2021 Guidance Year Ending October 31, 2021 Reconciliation of Estimated Income from Continuing Operations per Diluted Share to Estimated Adjusted Income from Continuing Operations per Diluted Share Low Estimate High Estimate Income from continuing operations per diluted share (a) $ 2.85 $ 3.10 Adjust
Slide 47: Contact Us
Contact Us INVESTOR RELATIONS David Gold (212) 750-5800 ir@abm.com 47