PR Newswire | Jan 27, 2021 07:31AM EST

01/27 06:30 CST

Rollins, Inc. Reports Fourth Quarter and Full Year 2020 Financial Results ATLANTA, Jan. 27, 2021

ATLANTA, Jan. 27, 2021 /PRNewswire/ --

* Total revenue increased 6.0% for the quarter and 7.2% for full year * Residential revenues increased 11.0% for the quarter 13.3% for full year * Earnings Per Share of $0.13 for the fourth quarter and $0.53 full year 2020

Rollins, Inc. (NYSE:ROL), a premier global consumer and commercial services company, reported strong unaudited financial results for its fourth quarter and year ended December 31, 2020.

The Company recorded fourth quarter revenues of $536.3 million, an increase of 6.0% over the prior year's fourth quarter revenue of $506.0 million. Rollins' reported net income of $62.6 million or $0.13 per diluted share for the fourth quarter ended December 31, 2020, compared to $50.8 million or $0.10 per diluted share for the same period in 2019.

All shares and per share data have been adjusted to reflect the 3-for-2 stock split effective December 10, 2020.

For the full year ended December 31, 2020, Rollins' revenues rose 7.2% to $2.161 billion compared to $2.015 billion for the prior year. The Company reported net income of $260.8 million or $0.53 per diluted share compared to $203.3 million or $0.41 per diluted share for the same period last year. Net income for the full year 2020 was negatively impacted by the one-time non-cash accelerated stock vesting of $6.7 million. Adjusted net income* for the full year 2020 was $267.5 million or $0.54 per diluted share, compared to adjusted net income* of $229.9 million or $0.47 per diluted share for the same period last year.

Gary W. Rollins, Chairman and Chief Executive Officer of Rollins, Inc. stated, "We are very proud of our results, and our employees and their commitment to customer service. Although 2020 brought many difficult circumstances related to COVID, we benefitted from our residential pest control demand and our previous technology investments."

Rollins, Inc. is a premier global consumer and commercial services company. Through its family of leading brands, Orkin, HomeTeam Pest Defense, Clark Pest Control, Orkin Canada, Western Pest Services, Northwest Exterminating, Critter Control, The Industrial Fumigant Company, Trutech, Orkin Australia, Waltham Services, OPC Services, PermaTreat, Rollins UK, Aardwolf Pestkare, and Crane Pest Control, the Company provides essential pest control services and protection against termite damage, rodents and insects to more than two million customers in North America, South America, Europe, Asia, Africa, and Australia from more than 700 locations. You can learn more about Rollins and its subsidiaries by visiting our web sites at www.orkin.com, www.pestdefense.com, www.clarkpest.com,www.orkincanada.ca, www.westernpest.com, www.callnorthwest.com,www.crittercontrol.com, www.indfumco.com, www.trutechinc.com, www.orkinau.com, www.walthamservices.com, www.opcpest.com, www.permatreat.com, www.safeguardpestcontrol.co.uk, www.aardwolfpestkare.com,www.cranepestcontrol.com and www.rollins.com. You can also find this and other news releases at www.rollins.com by accessing the news releases button.

*Adjusted amounts presented in this release are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics including a reconciliation of the most closely correlated GAAP measure.

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS This release contains statements that may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The actual results of the Company could differ materially from those indicated because of various risks and uncertainties, including without limitation, the extent and duration of the coronavirus (COVID-19) pandemic and its potential impact on the financial health of the Company's business partners, customers, supply chains and suppliers, global economic conditions and capital and financial markets, changes in consumer behavior and demand, the potential unavailability of personnel or key facilities, modifications to the Company's operations, and the potential implementation of regulatory actions; economic and competitive conditions which may adversely affect the Company's business; the degree of success of the Company's pest and termite process, and pest control selling and treatment methods; the Company's ability to identify and integrate potential acquisitions; climate and weather trends; competitive factors and pricing practices; the Company's ability to attract and retain skilled workers, and potential increases in labor costs; uncertainties of litigation; the results of the SEC's investigation of the Company; and changes in various government laws and regulations, including environmental regulations. All of the foregoing risks and uncertainties are beyond the ability of the Company to control, and in many cases the Company cannot predict the risks and uncertainties that could cause its actual results to differ materially from those indicated. A more detailed discussion of potential risks facing the Company can be found in the Company's Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2019 and the Company's Report on Form 10-Q filed with the Securities and Exchange Commission for the quarters ended March 31, 2020, June 30, 2020 and September 30, 2020.

ROL-Fin

ROLLINS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(in thousands)

At December 31, (unaudited) 2020 2019

ASSETS

Cash and cash equivalents $ 98,477 $ 94,276

Trade accounts receivables, net 126,337 122,766

Financed receivables, net 23,716 22,267

Materials and supplies 30,843 19,476

Other current assets 35,404 51,002

Total Current Assets 314,777 309,787

Equipment and property, net 178,860 195,533

Goodwill 650,794 572,847

Customer contracts, net 305,655 273,720

Trademarks and tradenames, net 104,644 102,539

Other intangible assets, net 10,045 10,525

Operating lease, right-of-use assets 212,342 200,727

Financed receivables, long-term, net 38,187 30,792

Benefit plan assets 1,198 21,565

Deferred income tax assets 2,222 2,180

Other assets 27,176 24,161

Total Assets $ 1,845,900 $ 1,744,376

LIABILITIES

Accounts payable 64,596 35,234

Accrued insurance, current 31,675 30,441

Accrued compensation and related liabilities 91,011 81,943

Unearned revenue 131,253 122,825

Operating lease liabilities, current 73,248 66,117

Current portion of long-term debt 17,188 12,500

Other current liabilities 64,540 60,975

Total Current Liabilities 473,511 410,035

Accrued insurance, less current portion 36,067 34,920

Operating lease liabilities, less current portion 140,897 135,651

Long-term debt 185,812 279,000

Deferred income tax liabilities 10,612 9,927

Long-term accrued liabilities 57,641 59,093

Total Liabilities 904,540 928,626

STOCKHOLDERS' EQUITY

Common stock 491,612 491,146

Retained earnings and other equity 449,748 324,604

Total stockholders' equity 941,360 815,750

Total Liabilities and Stockholders' Equity $ 1,845,900 $ 1,744,376

ROLLINS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands except per share data)

(unaudited)

Three Months Ended Twelve Months Ended

December 31, December 31,

2020 2019 2020 2019

REVENUES

Customer services $ 536,292 $ 505,985 $ 2,161,220 $ 2,015,477

COSTS AND EXPENSES

Cost of services provided 266,344 254,284 1,048,592 993,593

Depreciation and amortization 22,403 22,606 88,329 81,111

Sales, general and administrative 159,086 154,795 656,207 623,379

Accelerated stock vesting expense - - 6,691 -

Pension settlement loss - - - 49,898

Loss / (gain) on sale of assets, net 970 (175) 1,599 (581)

Interest expense, net 591 2,466 5,082 6,917

449,394 433,976 1,806,500 1,754,317

INCOME BEFORE INCOME TAXES 86,898 72,009 354,720 261,160

PROVISION FOR INCOME TAXES 24,279 21,244 93,896 57,813

NET INCOME $ 62,619 $ 50,765 $ 260,824 $ 203,347

NET INCOME PER SHARE - BASIC AND DILUTED $ 0.13 $ 0.10 $ 0.53 $ 0.41

Weighted average shares outstanding - basic and diluted 491,619 491,159 491,605 491,216

APPENDIX

Reconciliation of GAAP and non-GAAP Financial Measures

The Company has used the non-GAAP financial measures of adjusted net income and adjusted EPS in today's earnings release. These measures should not be considered in isolation or as a substitute for net income or other performance measures prepared in accordance with GAAP.

The Company uses adjusted net income and adjusted EPS as a measure of operating performance because it allows it to compare performance consistently over various periods without regard to the impact of the accelerated stock vesting expense and pension settlement losses.

A non-GAAP financial measure is a numerical measure of financial performance, financial position, or cash flows that either 1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows, or 2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented.

Set forth below is a reconciliation of adjusted net income and adjusted EPS with net income, the most comparable GAAP measures.

(unaudited in thousands except EPS)

Twelve Months Ended

December 31,

2020 2019 Better/ % (Worse)

Net Income $ 260,824 $ 203,347 $ 57,477 28.3 %

Accelerated Stock Vesting Expense 6,691 - 6,691 -

Pension Settlement Loss - 49,898 (49,898) -

Adjusted Income Taxes on Excluded Expenses - (23,315) 23,315 -

Adjusted Net Income $267,515 $229,930 $37,585 16.3 %

Adjusted Net Income Per Share - Basic And Diluted $ 0.54 $ 0.47 $ 0.07 14.9

Weighted average participating shares 491,605 491,216 389 0.1outstanding - basic and diluted

CONFERENCE CALL ANNOUNCEMENTRollins, Inc.(NYSE: ROL)

Management will hold a conference call to discussFourth Quarter 2020 results on

Wednesday, January 27, 2021 at:10:00 a.m. Eastern9:00 a.m. Central8:00 a.m. Mountain7:00 a.m. Pacific

TO PARTICIPATE:Please dial 877-407-9716 domestic;201-493-6779 internationalwith conference ID of13714448at least 5 minutes before start time.

REPLAY: available through February 3, 2021Please dial 844-512-2921 / 412-317-6671, Passcode 13714448THIS CALL CAN ALSO BE ACCESSED THROUGH THE INTERNET AT

www.rollins.com

Questions?Contact Samantha Alphonso at Financial Relations Board at 212-827-3746Or email to salphonso@mww.com

For Further Information ContactEddie Northen, (404) 888-2242

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SOURCE Rollins, Inc.