SERVICEMASTER GLOBAL HOLDINGS INC (SERV) SEC Filing 10-K Annual report for the fiscal year ending Saturday, December 31, 2016

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Exhibit 99.1

Picture 2

For further information contact:



Investor Relations:

James Shields

901.597.6839

James.Shields@servicemaster.com

 

Media:

Peter Tosches

901.597.8449

Peter.Tosches@servicemaster.com

 

ServiceMaster Global Holdings, Inc. Reports

Fourth-Quarter and Full Year 2016 Financial Results

 

Fourth-Quarter 2016

·

Revenue increased 5% to $633 million with 14% and 3% growth at AHS and Terminix, respectively

·

Net income of $31 million, or $0.23 per share, versus $17 million, or  $0.12 per share, a year ago

·

Adjusted EBITDA(1) increased 16% to $144 million from $124 million a year ago

·

Adjusted net income(2) of $60 million, or $0.44 per share, versus $45 million, or $0.33 per share, a year ago

Outlook Full Year 2017

·

Revenue between $2,885 million and  $2,915 million, or growth over prior year between 5% and 6%, and Adjusted EBITDA between  $700 million and  $715 million, or growth between 5%  and 7% over prior year

MEMPHIS, TENN, — February 23, 2017  —ServiceMaster Global Holdings, Inc.  (NYSE: SERV), a leading provider of essential residential and commercial services, today announced unaudited fourth-quarter and full year 2016 results. For the fourth-quarter, the company reported a year-over-year revenue increase of 5 percent, and, for the full year, the company reported a year-over-year revenue increase of 6 percent. Both the fourth quarter and full year increases in revenue were driven primarily by organic growth at American Home Shield (“AHS”),  the impacts of acquiring Alterra Pest Control, LLC (“Alterra”) in November 2015,  OneGuard Home Warranties (“OneGuard”) in June 2016 and Landmark Home Warranty (“Landmark”) in November 2016.

Fourth-quarter 2016 net income was  $31 million, or $0.23 per share, versus $17 million, or $0.12 per share, in the same period in 2015. Full year 2016 net income was $155 million, or $1.13 per share, versus full year 2015 net income of $160 million, or $1.17 per share. Pre-tax income includes charges for fumigation related matters of $93 million in the full year 2016 and $9 million in the fourth-quarter and full year 2015, an insurance reserve adjustment of $23 million in the full year 2016 and a loss on extinguishment of debt of $32 million in the fourth-quarter and full year 2016 and $58 million in the full year 2015. Additionally, fourth-quarter and full year 2015 include an estimated charge relating to our voluntary correction proposal to our 401(k) plan for $23 million.

Fourth-quarter 2016  Adjusted EBITDA was  $144 million, a year-over-year increase of $20 million, or 16 percent, primarily driven by an increase in Adjusted EBITDA of $18 million at AHS. Full year 2016 Adjusted EBITDA was $667 million, a year-over-year increase of $45 million, or 7 percent, driven largely by increases at Terminix and AHS of $24 million and $15 million, respectively.

Fourth-quarter 2016 adjusted net income was $60 million, or $0.44 per share, versus $45 million, or $0.33 per share, for the same period in 2015. Full year 2016 adjusted net income was $281 million, or $2.04 per share, versus full year 2015 adjusted net income of $245 million, or $1.80 per share.

Rob Gillette, ServiceMaster’s chief executive officer, noted: This was another solid quarter. At American Home Shield, both revenue and Adjusted EBITDA growth increased  as we continue to focus on streamlining operations, growing organically and capitalizing on recent acquisitions.  At Terminix, our investment in our termite business continues to show progress as year-over-year sales and revenue continue to grow. Challenges remain in our pest control business but we are confident the operational changes we are making will improve customer service and retention and result in solid growth in the future.



1


The following information was filed by SERVICEMASTER GLOBAL HOLDINGS INC on Thursday, February 23, 2017 as an 8K 2.02 statement, which is a press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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  • serv_10k_2017-02-24_11_8
    Financial - Expense
    Additionally, for the years ended December 31, 2016, 2015 and 2014, these charges included severance and other costs of $2 million, $1 million and $6 million, respectively, related to an initiative to enhance capabilities and reduce costs in our headquarters functions that provide company-wide administrative services for our operations.
  • serv_10k_2017-02-24_38_57
    Other - Other
    the 401k Plan correction contribution and other employee benefit plan compliance issues
  • serv_10k_2017-02-24_53_72
    Financial - Expense
    increases in interest rates increasing the cost of servicing our substantial indebtedness
  • serv_10k_2017-02-24_33_18
    Other - Other
    These obligations include commitments for various products and services including, among other things, inventory purchases, telecommunications services, marketing and advertising services and other professional services.
  • serv_10k_2017-02-24_4_31
    Revenue - Product
    Includes a $33 million and a $17 million reduction in revenue from company-owned branches, offset, in part, by a $2 million and a $1 million increase in royalty fees as result of the branch conversions for the years ended December 31, 2016 and 2015, respectively.
  • serv_10k_2017-02-24_9_35
    Financial - Expense
    Represents lease termination and other costs driven by the decision to consolidate the stand-alone operations of HSA acquired in February 2014 with those of American Home Shield.
  • serv_10k_2017-02-24_45_64
    Other - Other
    our ability to attract and retain key personnel, including our ability to attract, retain and maintain positive relations with trained workers and third-party contractors
  • serv_10k_2017-02-24_33_19
    Other - Other
    Arrangements are considered purchase obligations if a contract specifies all significant terms, including fixed or minimum quantities to be purchased, a pricing structure and approximate timing of the transactions.
  • serv_10k_2017-02-24_10_36
    Financial - Expense
    Represents severance costs related to the reorganization of the Franchise Services Group.
  • serv_10k_2017-02-24_34_23
    Other - Other
    Goodwill and intangible assets that are not subject to amortization are subject to assessment for impairment by applying a fair-value based test on an annual basis or more frequently if circumstances indicate a potential impairment.
  • serv_10k_2017-02-24_54_73
    Financial - Expense
    increased borrowing costs due to lowering or withdrawal of the ratings, outlook or watch assigned to our debt securities

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Exhibit 10.17 - MATERIAL CONTRACT

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Exhibit 10.30 - MATERIAL CONTRACT

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Exhibit 10.33 - MATERIAL CONTRACT

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Exhibit 12 - STATEMENT REGARDING CALCULATION OF RATIOS

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Exhibit 21 - SUBSIDARIES OF THE REGISTRANT

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Exhibit 23 - CONSENTS OF EXPERTS AND COUNSEL

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Exhibit 31.1 - RULE 13A-14A/15D-14A CERTIFICATION

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Exhibit 31.2 - RULE 13A-14A/15D-14A CERTIFICATION

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Exhibit 32.1 - SECTION 1350 CERTIFICATION

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Exhibit 32.2 - SECTION 1350 CERTIFICATION

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  • Form Type: Annual
  • Number of times amended: 0
  • Accession Number: 0001428875-17-000052
  • Submitted to the SEC: Friday, February 24, 2017
  • Accepted by the SEC: Friday, February 24, 2017
  • Period Ending: December 2016
Companies
 

SERV Morningstar

SERVICEMASTER GLOBAL HOLDINGS INC

$47.16 +0.25 (+0.53%)

Day's Range:
$46.90 to $47.23

52-Week Range:
$34.36 to $48.48

Volume:
485,723

Volume (Avg):
1,220,470

Earnings per Share:
$1.64

PEG / Short / PE Ratios:
2.92 / 6.41 / 28.76

Market Cap:
$6.29B

Book Value:
5.55

EBITDA:
$665.00M

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