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):  January 27, 2010

ROLLINS, INC.

(Exact name of registrant as specified in its charter)

Delaware	1-4422	51-0068479
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer 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):

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o    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.

On January 27, 2010, the Company issued a press release announcing its results for the fourth quarter and full year 2009.  The Company hereby incorporates by reference herein the information set forth in its Press Release dated January 27, 2010, 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 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 for the year ended December 31, 2008 filed 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 January 27, 2010.

2

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:  January 27, 2010	By:	/s/ Harry J. Cynkus
	Name:	Harry J. Cynkus
	Title:	Vice President, Chief Financial Officer and Treasurer
		(Principal Financial and Accounting Officer)

3

EX-99.1

Exhibit 99.1

For Further Information Contact

Harry J. Cynkus (404) 888-2922

FOR IMMEDIATE RELEASE

ROLLINS, INC. REPORTS FOURTH QUARTER AND FULL-YEAR 2009

FINANCIAL RESULTS

Company Posts 15th Consecutive Quarter of Improved Earnings Results

·Revenue increased 4.6% for the quarter and 5.2% for full year

·Net income up 59.0% for the quarter and 21.8% for the full year

·Earnings per diluted share rose 53.8% for the quarter  to  $0.20  from  $0.13 and 21.7% to $0.84 from  $0.69 for the full year

ATLANTA, GEORGIA, January 27, 2010: Rollins, Inc. (NYSE:ROL), a premier North American consumer and commercial services company, today reported unaudited financial results for its fourth quarter and year ended December 31, 2009.

The Company recorded fourth quarter revenues of $259.6 million, an increase of 4.6% over the prior year’s fourth quarter revenue of $248.1 million.  Net income increased 59.0% to $20.0 million or $0.20 per diluted share for the fourth quarter ended December 31, 2009, compared to $12.6 million or $0.13 per diluted share for the same period in 2008.

In the fourth quarter of 2009, Rollins converted Orkin, Inc. and certain other operating subsidiaries from C corporations to wholly owned limited liability companies.  This change will allow Rollins to use the operating profits generated by these subsidiaries to offset Rollins’ state tax losses and reduce state income taxes.  The Company also recognized a non-cash pre-tax impairment charge of approximately $2.9 million following management’s determination that a routing and scheduling system under development would require substantial changes and expense in order to deliver the product expected.  The Company is exploring alternative solutions as the potential benefits of an effective routing and scheduling system would be significant.

Excluding a tax benefit of $6.2 million or $0.06 per diluted share on Rollins’ conversion of Orkin to a limited liability company, net of cost associated with a Canadian restructuring and repatriation of cash, and the impairment charge of $0.02 per diluted share associated with the software system write-off, the Company’s earnings per share for fourth quarter 2009 were $0.16 per diluted share, an improvement of 23.1% compared to fourth quarter 2008.

The Company repurchased 227,100 shares at a weighted average price of $18.18 per share in the fourth quarter bringing the total number of shares repurchased in 2009 to 1,677,200.  In total, 2,951,591 additional shares may be purchased under the share repurchase program.

Revenues for the full year 2009 rose 5.2% to $1.1 billion compared to slightly over $1.0 billion for the prior year.  Rollins’ net income for the full year rose 21.8% to $84.0 million, or $0.84 per diluted share, compared to net income of $68.9 million, or $0.69 per diluted share for the prior year. Excluding the impact of Rollins conversion of Orkin to a limited liability company, and the impairment charge associated with the software system write off in the fourth quarter of 2009, the Company’s earnings for the year were $0.80 per diluted share, an improvement of 15.9% compared to the full year 2008.

Rollins’ balance sheet continued to strengthen with total assets increasing to $566.5 million and stockholder’s equity of $264.6 million.

Gary W. Rollins, President and Chief Executive Officer of Rollins, Inc. stated, “Once again, the Rollins family of pest control companies has exceeded our objectives.  We are pleased to have delivered solid results for the fourth quarter as well as the year. These results reflect our success in navigating through a challenging economy and tough selling environment, while growing market share and controlling our expenses.”

Mr. Rollins concluded, “The continued development and deployment of our key programs should enable us to continue to make prudent investments to grow our business both organically and through strategic acquisitions.  We believe that Rollins enters the 2010 fiscal year well-positioned to benefit from our 2009 achievements.”

Rollins, Inc. is a premier North American consumer and commercial services company.  Through its wholly owned subsidiaries, Orkin, PCO Services, HomeTeam Pest Defense, Western Pest Services, The Industrial Fumigant Company and Crane Pest Control, the Company provides essential pest control services and protection against termite damage, rodents and insects to over 2 million customers in the United States, Canada, Mexico, Central America, the Caribbean, the Middle East, Asia and the Mediterranean from over 500 locations.   You can learn more about our subsidiaries by visiting our Web sites at www.orkin.com, www.pestdefense.com, www.westernpest.com, www.orkincanada.ca, www.indfumco.com, www.cranepestcontrol.com and www.rollins.com.  You can also find this and other news releases at www.rollins.com by accessing the news releases button.

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 forward-looking statements include the statements about the Company’s belief that the continued development and deployment of the Company’s key programs should enable the Company to continue to make prudent investments to grow its business both organically and through strategic acquisitions, and the Company’s belief that it enters the 2010 fiscal year well-position to benefit from its 2009 achievements.  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, economic and competitive conditions which may adversely affect our Company’s business; 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; 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, 2008.

ROLLINS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(in thousands)

At December 31, (unaudited)	2009		2008
ASSETS
Cash and cash equivalents	$	9,504	$	13,716
Trade receivables, short-term	60,590		56,884
Accounts Receivable - Other	2,164		2,185
Materials and supplies	10,208		10,893
Deferred income taxes	25,839		20,018
Other current assets	12,225		13,142
Total Current Assets	120,530		116,838
Trade receivables, long-term	9,356		11,124
Equipment and property, net	74,644		78,625
Goodwill	189,658		187,266
Customer Contracts	121,176		129,092
Other Intangible Assets	24,785		25,719
Deferred income taxes	17,901		17,886
Other assets	8,446		5,967
Total Assets	$	566,496	$	572,517
LIABILITIES
Accounts payable	$	15,841	$	18,782
Accrued insurance	16,567		15,404
Accrued compensation and related liabilities	57,377		56,334
Unearned revenue	85,883		88,288
Capital leases	217		450
Line of Credit	30,000		65,000
Other current liabilities	26,868		28,569
Total Current Liabilities	232,753		272,827
Capital leases, less current portion	33		171
Accrued pension	14,895		20,353
Long-term accrued liabilities	54,249		50,733
Total Liabilities	301,930		344,084
STOCKHOLDERS’ EQUITY
Common stock	98,904		100,041
Retained earnings and other equity	165,662		128,392
Total Stockholders’ Equity	264,566		228,433
Total Liabilities and Stockholders’ Equity	$	566,496	$	572,517

ROLLINS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(in thousands except per share data)

(unaudited)

	Fourth Quarter Ended				Twelve Months Ended
	December 31,				December 31,
	2009		2008		2009		2008
REVENUES
Customer services	$	259,567	$	248,076	$	1,073,958	$	1,020,564
COSTS AND EXPENSES
Cost of services provided	136,562		133,050		551,002		534,494
Depreciation and amortization	9,045		9,096		37,169		33,443
Sales, general and administrative	88,563		84,120		355,590		339,078
(Gain)/loss on impairment/sale of assets	2,935		23		2,942		(166		)
Interest expense, net	118		913		964		761
	237,223		227,202		947,667		907,610
INCOME BEFORE TAXES	22,344		20,874		126,291		112,954
PROVISION FOR INCOME TAXES	2,383		8,321		42,307		44,020
NET INCOME	$	19,961	$	12,553	$	83,984	$	68,934
NET INCOME PER SHARE - BASIC	$	0.20	$	0.13	$	0.84	$	0.69
NET INCOME PER SHARE - DILUTED	$	0.20	$	0.13	$	0.84	$	0.69
Weighted average shares outstanding - basic	98,970		98,851		99,453		99,209
Weighted average shares outstanding - diluted	99,230		99,659		99,749		100,081

ROLLINS, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIALS

(in thousands except per share data)

(unaudited)

				Fourth Quarter			Twelve Months
				Ended			Ended
				December 31, 2009			December 31, 2009
Net income as reported				$	19,961		$	83,984
Add: Impairment of Orion (net of taxes)				1,809			1,809
Less: Tax benefit for valuation allowance related to LLC conversion and Canadian repatriation	$	(7,889	)
Add: Tax cost related to Canadian restructuring and repatriation of cash	$	1,737
Less: Net tax benefit				(6,152		)	(6,152		)
Adjusted earnings				$	15,618		$	79,641
Adjusted earnings per share - diluted excluding impairment charges and tax benefit				$	0.16		$	0.80
Weighted average shares outstanding - diluted				99,230			99,749

ROLLINS, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIALS

 (in thousands except per share data)

 (unaudited)

	Fourth Quarter			Twelve Months
	Ended			Ended
	December 31, 2009			December 31, 2009
Net income per share - diluted as reported	$	0.20		$	0.84
Add: Impairment of Orion (net of taxes)	0.02			0.02
Less: Net tax benefit	(0.06		)	(0.06		)
Adjusted earnings per share - diluted	$	0.16		$	0.80

(( CONFERENCE CALL ANNOUNCEMENT ((

Rollins, Inc.

(NYSE: ROL)

Management will hold a conference call to discuss

Fourth Quarter results on:

Wednesday, January 27, 2010 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 888-561-1721 domestic;

480-629-9868 international

at least 5 minutes before start time.

REPLAY: available through February 3, 2010

Please dial 800-406-7325/303-590-3000, Passcode: 4200223

THIS CALL CAN ALSO BE ACCESSED THROUGH THE INTERNET AT

www.viavid.net

Questions?

Contact Samantha Alphonso at Financial Relations Board at 212-827-3746

Or email to salphonso@mww.com