Slide 1: Third Quarter 2024 Earnings Webcast Presentation
Third Quarter 2024 Earnings Webcast Presentation Rollins, Inc. October 24, 2024
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking Statements This presentation as well as other written or oral statements by the Company may contain “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our cu
Slide 3: Reconciliation of GAAP and Non-GAAP Financial Measures
Reconciliation of GAAP and Non-GAAP Financial Measures The Company has used the non-GAAP financial measures of organic revenues, organic revenues by type, adjusted operating income, adjusted operating margin, adjusted net income, adjusted earnings per share (“EPS”), earnings before interest, taxes,
Slide 4: Q3 2024 Results
Q3 2024 Results Other Revenue $916M +9% Q3 Highlights • Healthy growth across all major service lines • Organic growth1 of 7.7%; acquisitions drove remaining $0.29 +4% growth, offset by divestitures in Q3 2024 Adj. EPS • Gross margin of 54% and pressure in SG&A from incremental sales staffing and ma
Slide 5: Q3 Revenue Growth
Q3 Revenue Growth +14.5% +9.0% +9.4% $23 $916 +6.4% $26 $26 $21M organic1 $1M acquisition1 $840 $22M organic1 $19M organic1 $6M acquisition1 $10M acquisition1 ($3M) impact of divestiture1 ($3M) impact of divestiture1 Q3 2023 Residential Commercial Termite Q3 2024 Total Organic Revenue Growth of 7.7%
Slide 6: Q3 Adj. EBITDA Margin
Q3 Adj. EBITDA Margin1 HIGHLIGHTS Gross Profit 0.2% • Gross margin 54% 24.8% • Positive on price cost equation -80 bps • Pressures from incremental 24.0% people investments were offset 0.1% by leverage in Materials & -1.0% Supplies, as well as Fleet Adj. SG&A1 • Additional investments in Selling Adj
Slide 7: Cash Flow and Use of Liquidity
Cash Flow and Use of Liquidity HIGHLIGHTS Cash Generation Q3 & YTD 2024 Free Cash Flow1 YTD 2024 Uses of Cash Flow • Q3 Free Cash Flow +12% & Liquidity Conversion1 was ~102% $396M • Strong balance sheet with modest levels of debt +16% $354M ACQUISITIONS ($106M) Acquisitions $139M • Closed 6 acquisit
Slide 8: Key Takeaways
Key Takeaways Focus on Modernization Exceptional Performance Hiring key talent across the organization to YTD organic growth of 7.7% driven by robust accelerate modernization efforts organic growth across all service areas Focused on upgrading technology and executing Healthy pipeline of acquisition
Slide 9: Balanced 2024 Outlook
Balanced 2024 Outlook WHAT WE ARE SEEING WHAT WE EXPECT Organic Growth Continued Growth Healthy market growth and solid execution Focused on delivering solid growth and healthy driving strong organic growth incremental margins in 2024, further complemented by a strategic and disciplined Inorganic Gr
Slide 10: Growth Algorithm
Growth Algorithm Last 3 Years 2024E Medium-Term Outlook Above-Market ~7% to 8% Organic Organic Growth Revenue Growth 12% ~2% to 3% M&A + ~9% to 11% M&A Adj. Incremental EBITDA Margin 1 ~27% ~30% ~30-35% FCF Conversion 1 ~112% Average > 100% > 100% © 2024 Rollins, Inc. All rights reserved. 1These amo
Slide 11: Appendix
APPENDIX 11
Slide 12: Reconciliation of GAAP and Non-GAAP Financial Measures
Reconciliation of GAAP and Non-GAAP Financial Measures Set below are reconciliations of non-GAAP financial measures used in this investor presentation and conference call with their most directly comparable GAAP measures. (1) Consists of expenses resulting from the amortization of certain intangible
Slide 13: Reconciliation of GAAP and Non-GAAP Financial Measures
Reconciliation of GAAP and Non-GAAP Financial Measures Set below are reconciliations of non-GAAP financial measures used in this investor presentation and conference call with their most directly comparable GAAP measures. Three Months Ended September 30, Nine Months Ended September 30, Variance Vari
Slide 14: Reconciliation of GAAP and Non-GAAP Financial Measures
Reconciliation of GAAP and Non-GAAP Financial Measures Set below are reconciliations of non-GAAP financial measures used in this investor presentation and conference call with their most directly comparable GAAP measures. Three Months Ended September 30, Nine Months Ended September 30, Variance Vari
Slide 15: Reconciliation of GAAP and Non-GAAP Financial Measures
Reconciliation of GAAP and Non-GAAP Financial Measures Set below are reconciliations of non-GAAP financial measures used in this investor presentation and conference call with their most directly comparable GAAP measures. Three Months Ended September 30, Nine Months Ended September 30, Variance Vari
Slide 16: Reconciliation of GAAP and Non-GAAP Financial Measures
Reconciliation of GAAP and Non-GAAP Financial Measures Set below are reconciliations of non-GAAP financial measures used in this investor presentation and conference call with their most directly comparable GAAP measures. Three Months Ended September 30, Nine Months Ended September 30, Variance Vari
Slide 17: Reconciliation of GAAP and Non-GAAP Financial Measures
Reconciliation of GAAP and Non-GAAP Financial Measures Set below are reconciliations of non-GAAP financial measures used in this investor presentation and conference call with their most directly comparable GAAP measures. Period Ended September 30, (unaudited, in thousands) 2024 Reconciliation of Lo
Slide 18: Reconciliation of GAAP and Non-GAAP Financial Measures
Reconciliation of GAAP and Non-GAAP Financial Measures Set below are reconciliations of non-GAAP financial measures used in this investor presentation and conference call with their most directly comparable GAAP measures. Three Months Ended September 30, Nine Months Ended September 30, (unaudited, i