-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Dp1zxW+0cB9Fl6tcXROfi4DG4nxag2AShGENSyucvORce3Qhwj0BRF2Zj5xlM5Yb NxeosNjOXXFUR3bQv9iK4g== 0000084839-05-000091.txt : 20051026 0000084839-05-000091.hdr.sgml : 20051026 20051026083505 ACCESSION NUMBER: 0000084839-05-000091 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20051026 ITEM INFORMATION: Results of Operations and Financial Condition FILED AS OF DATE: 20051026 DATE AS OF CHANGE: 20051026 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ROLLINS INC CENTRAL INDEX KEY: 0000084839 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-TO DWELLINGS & OTHER BUILDINGS [7340] IRS NUMBER: 510068479 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-04422 FILM NUMBER: 051155651 BUSINESS ADDRESS: STREET 1: 2170 PIEDMONT RD NE CITY: ATLANTA STATE: GA ZIP: 30324 BUSINESS PHONE: 4048882000 MAIL ADDRESS: STREET 1: 2170 PIEDMONT ROAD NE CITY: ATLANTA STATE: GA ZIP: 30324 8-K 1 earn3q8k.txt EARNINGS 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): October 26, 2005 ROLLINS, INC. (Exact name of registrant as specified in its charter) Delaware 1-4422 51-0068479 (State or other jurisdiction (Commission File Number) (I.R.S. Employer of incorporation) Identification No.) 2170 Piedmont Road, N.E., Atlanta, Georgia 30324 (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (404) 888-2000 Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ITEM 2.02. Results of Operations and Financial Condition The information provided pursuant to this Item 2.02 is to be considered "filed" under the Securities Exchange Act of 1934 ("Exchange Act") and incorporated by reference into those filings of Rollins, Inc (the "Company") that provide for the incorporation of all reports and documents filed by the Company under the Exchange Act. On October 26, 2005, the Company issued a press release announcing its results for the quarter ended September 30, 2005. The Company hereby incorporates by reference herein the information set forth in its Press Release dated October 26, 2005, a copy of which is attached hereto as Exhibit 99.1. Except as otherwise provided in the press release, the press release speaks only as of the date of such press release and such press release shall not create any implication that the affairs of the Company have continued unchanged since such date. Except for the historical information contained in this report, the statements made by the Company are forward-looking statements that involve risks and uncertainties. All such statements are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. The Company's future financial performance could differ significantly from the expectations of management and from results expressed or implied in the Press Release. See the risk factors contained in the Press Release for a discussion of certain risks and uncertainties that may impact such forward-looking statements. For further information on other risk factors, please refer to the "Risk Factors" contained in the Company's Form 10-K filed March 11, 2005 with the Securities and Exchange Commission. The Company disclaims any obligation or duty to update or modify these forward-looking statements. ITEM 9.01. Financial Statements and Exhibits Exhibit No. Description 99.1 Press Release Dated October 26, 2005 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, Rollins, Inc. has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. ROLLINS, INC. Date: October 26, 2005 By:/s/Harry J. Cynkus ---------------------------------------- Name: Harry J. Cynkus Title: Chief Financial Officer and Treasurer EX-99 2 earn3q991.txt EARNINGS PRESS RELEASE Exhibit 99.1 For Further Information Contact Harry J. Cynkus (404) 888-2922 FOR IMMEDIATE RELEASE ROLLINS, INC. REPORTS CONTINUED IMPROVEMENT IN QUARTERLY PERFORMANCE Highlights o 23rd consecutive quarter of improved performance o Diluted Earnings per share rose 15.8% to $0.22 o Net income rose 10.8% to $15.1 million compared to $13.6 million for the same period in 2004. ATLANTA, GEORGIA, October 26, 2005: Rollins, Inc. (NYSE:ROL), a premier North American consumer and commercial services company, today reported net income grew 10.8% to $15.1 million or $0.22 per diluted share for the third quarter ended September 30, 2005, compared to $13.6 million or $0.19 per diluted share for the third quarter ended September 30, 2004. Revenues for the third quarter grew 2.7% to $209.3 million compared to $203.9 million for the third quarter ended September 30, 2004. Rollins's net income for the first nine months of 2005 grew 18.9% to $45.4 million or $0.65 per diluted share, compared to $38.2 million or $0.54 per diluted share for the first nine months of 2004. Revenues for the first nine months of 2005 grew 7.1% to $607.6 million compared to $567.1 million for the first nine months of 2004. Rollins' balance sheet remains strong with total assets of $454.9 million and stockholders' equity increasing to $178.7 million. Total cash and cash equivalents rose to $79.5 million. Commenting on the Company's results, Gary W. Rollins, President and Chief Executive Officer of Rollins, Inc. said, "We are pleased to report our 23rd quarter of improved performance.* During the quarter, revenues were negatively impacted by approximately $1 million as a result of the effect of hurricanes Katrina and Rita impacting some of our branches in Alabama, Louisiana, Mississippi and Texas. Currently, it is difficult to estimate exactly when we will begin to reverse these shortfalls since the ultimate status of many impacted customer homes is uncertain at this time. Some branches will recover sooner than others. As a result we expect to see an impact on our fourth quarter. On a positive note, all of our 246 employees who were affected by the hurricanes are safe and we are providing all employment either in this area or other parts of the company. "On October 4, we announced that we have completed the acquisition of the Industrial Fumigant Company, (IFC). Prior to the acquisition, IFC had revenues in excess of $24 million and was the 24th largest company in the pest control industry. They have over 130 employees, 25 offices nationwide and 17 warehouses. IFC is an exemplary company and we expect their leadership position in the food and commodity pest management segment to make a significant contribution to the growth of our commercial operations. We look forward to working with this talented group of professionals." Mr. Rollins concluded, "We continue to focus on growing our commercial and residential businesses through providing excellent pest services to our customers and acquiring other pest control companies where beneficial." Rollins, Inc. is a premier North American consumer and commercial services company. Through its wholly owned subsidiaries, Orkin, Inc., Western Pest Services, and The Industrial Fumigant Company, the Company provides essential pest control services and protection against termite damage, rodents and insects to approximately 1.7 million customers in the United States, Canada and Mexico from over 400 locations. You can learn more about Orkin by visiting our Web sites at www.orkin.com, www.westernpest.com, www.indfumco.com and www.rollins.com. You can also find this and other news releases at www.rollins.com by accessing the news releases button. * See Rollins's Form 8-K dated July 27, 2005, for details regarding improvements in the quarter ended June 30, 2005. CAUTION CONCERNING FORWARD-LOOKING STATEMENTS This release contains statements that constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements regarding the impact of hurricanes Katrina and Rita and the success of 2005 for the Company and its shareholders. The actual results of the Company could differ materially from those indicated by the forward-looking statements because of various risks and uncertainties, including without limitation, general economic conditions; market risk; changes in industry practices or technologies; the degree of success of the Company's pest and termite process reforms 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; expected benefits of the commercial re-engineering project may not be realized, potential increases in labor costs; uncertainties of litigation; 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 by the forward-looking statements. 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, 2004.
ROLLINS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (In thousands) 2005 2004 At September 30 (Unaudited) (Unaudited) - ------------------------------------------------------------------------------------------------------------------------ ASSETS Cash and Cash Equivalents $ 79,489 $ 40,894 Marketable Securities 0 0 ----------------- --------------- Total Cash and Marketable Securities 79,489 40,894 Trade Receivables Short-Term, Net 48,954 52,296 Materials and Supplies 7,358 11,002 Deferred Income Taxes 30,389 28,831 Other Current Assets 9,359 11,283 ----------------- --------------- Current Assets 175,549 144,306 Equipment and Property, Net 57,928 45,186 Goodwill and Other Intangible Assets 189,893 193,781 Trade Receivables Long-Term, Net 9,866 11,063 Deferred Income Taxes 17,441 6,569 Prepaid Pension 0 24,964 Other Assets 4,221 5,840 ----------------- --------------- Total Assets $ 454,898 $ 431,709 ================= =============== - ------------------------------------------------------------------------------------------------------------------------ LIABILITIES Accounts Payable $ 14,901 $ 14,321 Accrued Insurance 16,516 13,049 Accrued Payroll 38,816 38,741 Unearned Revenue 91,341 91,245 Other Current Liabilities 39,828 40,840 ----------------- --------------- Current Liabilities 201,402 198,196 Accrued Pension 27,291 0 Long-Term Accrued Liabilities 47,522 60,250 ----------------- --------------- Total Liabilities 276,215 258,446 ----------------- --------------- - ------------------------------------------------------------------------------------------------------------------------ STOCKHOLDERS' EQUITY Common Stock 68,383 68,502 Retained Earnings and Other Equity 110,300 104,761 ----------------- --------------- Total Stockholders' Equity 178,683 173,263 ----------------- --------------- Total Liabilities and Stockholders' Equity $ 454,898 $ 431,709 ================= ===============
ROLLINS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME FOR THE THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 30 (In thousands except per share data) Third Quarter Nine Months --------------------------- ---------------------------- 2005 2004 2005 2004 (Unaudited) (Unaudited) (Unaudited) (Unaudited) ------------ ------------- ------------- ------------- REVENUES $ 209,346 $ 203,925 $ 607,587 $ 567,066 ------------ ------------- ------------- ------------- COSTS AND EXPENSES Cost of Services Provided 106,398 105,035 315,630 295,585 Depreciation and Amortization 5,800 6,249 17,808 16,670 Sales, General and Administrative 72,258 70,080 203,835 193,411 (Gain)/Loss on Sales of Assets - (315) (544) (14,457) Pension Curtailment - - (4,176) - Interest Income (489) (68) (1,305) (265) ------------ ------------- ---------------------------- TOTAL COSTS AND EXPENSES 183,967 180,981 531,248 490,944 ------------ ------------- ------------- ------------- INCOME BEFORE INCOME TAXES 25,379 22,944 76,339 76,122 PROVISION FOR INCOME TAXES 10,279 9,311 30,918 31,732 ------------ ------------- ------------- ------------- INCOME BEFORE CUMULATIVE EFFECT CHANGE IN ACCOUNTING PRINCIPLE 15,100 13,633 45,421 44,390 CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE, NET - - - (6,204) ------------ ------------- ------------- ------------- NET INCOME $ 15,100 $ 13,633 $ 45,421 $ 38,186 ============ ============= ============= ============= NET INCOME PER COMMON SHARE-BASIC: INCOME BEFORE CUMULATIVE EFFECT CHANGE IN ACCOUNTING PRINCIPLE $ 0.22 $ 0.20 $ 0.67 $ 0.65 CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE, NET - - - (0.09) ------------ ------------- ------------- ------------- NET INCOME PER COMMON SHARE-BASIC $ 0.22 $ 0.20 $ 0.67 $ 0.56 ============ ============= ============= ============= NET INCOME PER COMMON SHARE-DILUTED: INCOME BEFORE CUMULATIVE EFFECT CHANGE IN ACCOUNTING PRINCIPLE $ 0.22 $ 0.19 $ 0.65 $ 0.63 CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE, NET - - - (0.09) ------------ ------------- ------------- ------------- NET INCOME PER COMMON SHARE-DILUTED $ 0.22 $ 0.19 $ 0.65 $ 0.54 ============ ============= ============= ============= AVERAGE SHARES OUTSTANDING - BASIC 68,117 68,224 67,999 68,101 AVERAGE SHARES OUTSTANDING - DILUTED 70,042 70,197 70,046 70,113
ROLLINS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30 (In thousands) 2005 2004 Unaudited Unaudited ------------------ ------------------ Operating Activities Net Income $ 45,421 $ 38,186 Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Change in Accounting Principle, Net - 6,204 Depreciation and Amortization 17,808 16,670 Pension Curtailment (4,176) - Provision for Deferred Income Taxes 2,085 7,319 Other, Net (800) 335 Gain on Sale of Assets (544) (14,457) (Increase) Decrease in Assets: Trade Receivables (3,212) (7,980) Materials and Supplies 1,536 500 Other Current Assets (2,059) (3,420) Other Non-Current Assets 233 (1,787) Increase (Decrease) in Liabilities: Accounts Payable and Accrued Expenses 6,417 13,334 Unearned Revenue 10,147 13,201 Accrued Insurance (2,484) (3,103) Accrual for Termite Contracts (1,263) (2,826) Long-Term Accrued Liabilities (424) (2,196) ------------------ ------------------ Net Cash Provided by Operating Activities 68,685 59,980 ------------------ ------------------ Investing Activities Purchases of Equipment and Property (16,999) (6,707) Net Cash Used for Acquisition of Companies (3,022) (103,415) Sales of Marketable Securities, Net - 21,866 Proceeds From Sale of Assets 752 15,473 ------------------ ------------------ Net Cash Used In Investing Activities (19,269) (72,783) ------------------ ------------------ Financing Activities Dividends Paid (10,304) (8,187) Common Stock Purchased (21,313) - Common Stock Options Exercised 3,229 1,734 Other 979 676 ------------------ ------------------ Net Cash Used in Financing Activities (27,409) (5,777) ------------------ ------------------ Effect of Exchange Rate Changes on Cash 745 (66) ------------------ ------------------ Net Increase/(Decrease) in Cash and Cash Equivalents 22,752 (18,646) Cash and Cash Equivalents at Beginning of Year 56,737 59,540 ------------------ ------------------ Cash and Cash Equivalents at End of Period $ 79,489 $ 40,894 ================== ==================
CONFERENCE CALL Rollins, Inc. (NYSE: ROL) Management will hold a conference call to discuss third quarter results on: - -------------------------------------------------------------------------------- Wednesday, October 26, 2005 at: - -------------------------------------------------------------------------------- 10:00 a.m. Eastern 9:00 a.m. Central 8:00 a.m. Mountain 7:00 a.m. Pacific TO PARTICIPATE: Please dial 800-240-6709 domestic; 303-262-2211 international at least 5 minutes before start time. REPLAY: available through November 2, 2005 Please dial 800-405-2236/303-590-3000, Passcode: 11041188 THIS CALL CAN ALSO BE ACCESSED THROUGH THE INTERNET AT www.viavid.net Questions? Contact Janet Jazmin at FRB/Weber Shandwick at 212-827-3777 Or email to jjazmin@financialrelationsboard.com -----END PRIVACY-ENHANCED MESSAGE-----