Abm Industries Incorporated · NYSE:ABM
Abm Industries — Investor Presentation (March 2006)
18 slides from Abm Industries's investor presentation, Mar 30, 2006
Slide 1: ABM Industries Incorporated Investor Meeting, New York City
ABM Industries Incorporated Investor Meeting, New York City
Slide 2: Safe Harbor
Safe Harbor Our presentation today contains predictions, estimates and other forward-looking statements. Our use of the words estimate, expect, and similar expressions is intended to identify these statements. These statements represent our current judgment on what the future holds. While we believe
Slide 3: Agenda
Agenda Introduction: David L. Farwell Senior Vice President Janitorial Segment Overview: James P. McClure Executive Vice President, President – ABM Janitorial Services CEO Perspective: Henrik C. Slipsager President & CEO Management Question and Answer: All
Slide 4: About the Company
About the Company Leading diversified facilities ABM’s Services services contractor – Janitorial – Engineering – Parking – Lighting – Security Commercial, industrial and retail customers nationwide Consolidator in highly fragmented industry National footprint Diversified customer base Co
Slide 5: Sales and Operating Profit
Sales and Operating Profit 10/31/05 Operating Profit 10/31/05 Sales = $2,586.6 Million (Excluding Corporate) = $99.4 Million Lighting Engineering 4.5% Lighting, Corporate 3.8% 9.2% 0.1% Engineering, 14.3% Security Security, 11.4% 3.1% Parking, Janitorial 10.6% Parking 59.0% Janitorial, 15.8% 68.2%
Slide 6: Janitorial Segment Overview
Janitorial Segment Overview James P. McClure Executive Vice President, President – ABM Janitorial Services
Slide 7: ABM Janitorial Services
ABM Janitorial Services Largest operating division -- 59% of FY05 revenue – Wide range of janitorial services – Diverse and broad customer base Operates in 42 states and the majority of the largest metropolitan areas in the country Employs nearly 50,000 individuals REVENUE ($ in MM) 2,000 1,60
Slide 8: Janitorial Market Overview
Janitorial Market Overview Approximately a $30 billion market --Outsourced commercial janitorial service is $12 billion Diverse customer base -- ABM has operations in each market segment High growth opportunities for ABM include: Biotech and Educational JANITORIAL MARKET SEGMENTS 5% 6% 7% 9% 6
Slide 9: Vacancy Rates
Vacancy Rates Data shows an increase in occupancy rates Y-O-Y VACANCY RATES 20.0% 18.0% 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 00 01 01 02 02 03 03 04 04 05 05 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q Metropolitan Industrial Office Downtown -SF Office Downtown -NYC/D Office Downtown -Chi
Slide 10: Janitorial Industry Trends
Janitorial Industry Trends Continued industry consolidation ¾ Only 150 companies generate over $10 million in revenue 6% top line annual growth Greater profitability for Companies with: ¾ Strong customer relationships ¾ Bundled services ¾ The highest standards of quality Sector is sensitive
Slide 11: Janitorial Segment Strategy
Janitorial Segment Strategy Maintain leadership presence in commercial high rises, but expand into other owner-operated facilities Focus on providing “customer-centric” services Continue to expand into under penetrated markets and business segments Continue to leverage economies of scale
Slide 12: CEO Perspective
CEO Perspective Henrik C. Slipsager President & CEO
Slide 13: Chronology of Events – FY 2005 Interim Statements
Chronology of Events – FY 2005 Interim Statements Jan. 26, 2006 Feb. 15, 2006 Identified errors - Subsequent Event FY 2005 Litigation Settlements Estimated Impact FY 2005 $4.4M Estimated Impact (after-tax) $4.8M (after-tax) Jan. 18, 2006 12b-25 March 29, 2006 Estimate $6.8M File 10-K Impact to Cash
Slide 14: FY06 EPS Impact – One Time Items
FY06 EPS Impact – One Time Items EPS Adjustments Impact SSA Operating Profit $ (0.10) (declining losses per quarter) Increased SOX & Audit (0.04) Audit Committee Investigation (0.03) (all charges booked in Q2) Other (0.01) Total Estimate $ (0.18)
Slide 15: FY2006 Issues
FY2006 Issues Improve profitability at SSA DSO focus Remediation of material weaknesses SOX 404 – Costs ¾2005 vs. 2006 Energy Act
Slide 16: Industry Opportunities: Portfolio of Services
Portfolio of Services Business Strengths Low Medium High Improve or Divest Grow and Improve Invest for Growth Business Strength High Industry Opportunities Fix or Divest Improve, Invest for Growth Invest for Growth Medium or Manage for Cash Divest Fix or Divest Manage for Cash Low
Slide 17: Strategic Initiatives
Strategic Initiatives Increase market share of owner-operated facilities ¾High-tech ¾Telecommunications ¾Industrial production plants Leverage ABM Facility service platform Continue expansion of national accounts Consolidate through accretive acquisitions Develop and expand internationally
Slide 18: Thank You
ABM Industries Incorporated Thank You