ABM reports Q3 adjusted EPS 79c, consensus 89c

Reports Q3 revenue $2B, consensus $2.01B. “In a challenging operating environment, ABM generated revenue growth of 3.4%. Strong growth in our Aviation, Education and Manufacturing & Distribution segments was partially offset by delayed project starts and lower bundled energy solutions activity within our Technical Solutions segment. Additionally, market conditions remained soft for our janitorial service line in Business & Industry,” said Scott Salmirs, ABM’s President & Chief Executive Officer. “Our teams have been taking actions to accelerate projects and we also quickly implemented measures to adjust our cost structure to the current demand environment in certain of our businesses. This helped us deliver solid adjusted margin and generate strong operating cash flow in the quarter. While we believe the delayed project starts in Technical Solutions are transitory and should be resolved in fiscal 2024, we expect that the commercial real estate market, particularly commercial office building occupancy, will likely remain soft throughout 2024. We are tightening our forecast for fiscal full year 2023 adjusted EPS to the lower end of the prior range and reaffirming our outlook for fiscal full year 2023 adjusted EBITDA margin. We will continue forward on our well-defined path to win new business, invest for the future through our ELEVATE program, and generate strong cash flow to drive shareholder returns. We are encouraged by the resiliency, positioning and growth potential of our business model and have a compelling strategy in place to drive long-term shareholder value.”