Company: ABM
Filing Date: 2025-03-12
Form Type: 10-Q
Source: 0000771497-25-000005
Chunk: 6

Company: ABM INDUSTRIES INC /DE/
Filing Date: 2025-03-12
Form: 10-Q
Item: Part I, Item 2
Chunk 6
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 ended January 31, 2025, from 4.0% in the prior year period. The increase in operating profit margin was primarily attributable to the contract mix, partially offset by higher selling, general, and administrative expenses, mainly due to increased compensation costs associated with headcount expansion from recent acquisitions and ongoing business growth.

  Corporate                                                                                                                      
                          Three Months Ended January 31,                                                                         
  ($ in millions)         2025                                            2024                  Increase                         
  Corporate expenses      $                                   (83.2)      $         (74.7)      $             (8.5)      (11.4)  

Corporate expenses increased by $8.5 million, or 11.4%, to $83.2 million during the three months ended January 31, 2025, as compared to the prior year period. The increase in corporate expenses was primarily attributable to:

• a $4.9 million increase in accruals for actual and potential legal settlements;

• a $4.3 million increase in compensation and related expenses primarily due to higher salaries and certain incentive plans; and

• a $2.0 million increase in acquisition and integration costs.

The increase was partially offset by:

• an absence of a $5.3 million unfavorable self-insurance reserve adjustment from actuarial evaluations completed in the three months ended January 31, 2024.

Liquidity and Capital Resources

Our primary sources of liquidity are operating cash flows and borrowing capacity under our Amended Credit Facility. We assess our liquidity in terms of our ability to generate cash to fund our short- and long-term cash requirements. As such, we project our anticipated cash requirements as well as cash flows generated from operating activities to meet those needs.

In addition to normal working capital requirements, we anticipate that our short- and long-term cash requirements will include funding legal settlements, insurance claims, dividend payments, capital expenditures, share repurchases, mandatory loan repayments, contingent consideration payments from acquisitions and systems and technology transformation initiatives under ourELEVATE strategy. We anticipate long-term cash uses may also include strategic acquisitions. On a long-term basis, we will continue to rely on our Amended Credit Facility for any long-term funding not provided by operating cash flows.

We believe that our operating cash flows and borrowing capacity under our Amended Credit Facility are sufficient to fund our cash requirements for the next 12 months. In the event that our plans change or our cash

requirements are greater than we anticipate, we may need to access the