Company: ABM
Filing Date: 2025-03-12
Form Type: 10-Q
Source: 0000771497-25-000005
Chunk: 2

Company: ABM INDUSTRIES INC /DE/
Filing Date: 2025-03-12
Form: 10-Q
Item: Part I, Item 2
Chunk 2
---
 higher project revenues due to the timing of certain microgrid systems design and installation projects within Technical Solutions and net new business and expansion of business with existing customers within Aviation and Education. The increase in revenues was partially offset by attrition of engineering customers within B& I and a loss of a certain customer within M& D. Acquisition growth was driven by a $12.7 million revenue increase from the Quality Uptime Acquisition, which was completed in June 2024.

• We had an increase in operating profit of $3.5 million, to $77.6 million, during the three months ended January 31, 2025, as compared to the prior year period. The increase was primarily attributed to:

◦ respective revenue increases and contract and service mix and operational efficiencies; and

◦ an absence of a $5.3 million unfavorable self-insurance reserve adjustment related to prior year claims from actuarial evaluations completed in the three months ended January 31, 2024.

The increase was partially offset by:

◦ base wage increases within Aviation and Education; and

◦ an increase in selling, general and administrative expenses, primarily due to higher compensation expenses from headcount expansion from recent acquisitions and ongoing business growth.

• Our effective tax rates from income on operations for the three months ended January 31, 2025, and January 31, 2024, were 21.4% and 17.3%, respectively. Our effective tax rate for the three months ended January 31, 2025, was reduced by discrete items, primarily return to provision adjustments related to our non-U. S. operations. Our effective tax rate for three months ended January 31, 2024, benefited from discrete items, primarily uncertain tax positions, share-based compensation, and return to provision adjustments.

• Net cash used in operating activities was $106.2 million during the three months ended January 31, 2025, as compared to net cash used in operating activities of $0.1 million during the prior year period. The change was primarily driven by an increase in working capital due to the transition to the Company’s new ERP systems for our Business and Industry and Manufacturing and Distribution segments that temporarily delayed invoicing to certain clients within these industry groups. We anticipate improvement in our operating cash flows next quarter and full normalization in the second half of fiscal year 2025.

• Dividends of $16.4 million were paid to shareholders, and dividends totaling $0.265 per common share were declared during