BrightView Holdings, Inc. (NYSE: BV) (the “Company” or
“BrightView”), the leading commercial landscaping services company
in the United States, today reported unaudited results for the
first quarter ended December 31, 2023.
FIRST QUARTER FISCAL
2024 SUMMARY
- Total revenue decreased 4.5% year-over-year to $626.7
million
- Net loss decreased 13.2% year-over-year to $16.4 million;
reflects 30-basis point improvement in Net Loss margin
- Adjusted EBITDA decreased 3.9% to $46.7 million; Adjusted
EBITDA margin expansion of 10-basis points
- Year-to-date net cash provided by operating activities of $26.2
million, an increase of $55.8 million
- Year-to-date free cash inflow of $17.3 million, an increase of
$72.7 million compared to an outflow of $55.4 million in the prior
year
RECENT
HIGHLIGHTS
- Strategic sale of non-core US Lawns franchise business in
January for cash proceeds of $51.6 million
COMPANY REAFFIRMS
FISCAL YEAR 2024 GUIDANCE
Total Revenue
$2.825 - $2.975 billion
Adjusted EBITDA1
$310 - $340 million
Free Cash Flow1
$45 - $75 million
“I am pleased to report that we are off to a solid start to
fiscal 2024 as we achieved meaningful progress on our objectives
outlined under One BrightView,” said BrightView President and Chief
Executive Officer Dale Asplund. “A continued focus on profitable
growth in our core business, another quarter of strong performance
converting our Development backlog, and execution of our cost
efficiency plans led to EBITDA margin expansion for the quarter. We
remain confident in our ability to execute our strategic
initiatives and are encouraged by the momentum driving our
business. Given these trends, we are reaffirming our guidance for
fiscal 2024. Additionally, we announced the January divestiture of
our non-core US Lawns franchise business. This strategic action
aligns with our focus on the core business and will allow us to
reinvest the proceeds back into the company."
1 Adjusted EBITDA and Free Cash Flow are non-GAAP measures.
Refer to the “Non-GAAP Financial Measures” section for more
information. The Company is not providing quantitative
reconciliations of its financial outlook for Adjusted EBITDA to net
(loss), or Free Cash Flow to Cash flows provided by operating
activities, the corresponding GAAP measures, because the GAAP
measures that are excluded from its non-GAAP financial outlook are
difficult to reliably predict or estimate without unreasonable
effort due to their dependence on future uncertainties, such as
items discussed below. Additionally, information that is currently
not available to the Company could have a potentially unpredictable
& potentially significant impact on its future GAAP financial
results.
Fiscal 2024 Results – Total BrightView
Total BrightView - Operating
Highlights
Three Months Ended December
31,
($ in millions, except per share
figures)
2023
2022
Change
Revenue
$
626.7
$
655.9
(4.5
%)
Net (Loss)
$
(16.4
)
$
(18.9
)
13.2
%
Net (Loss) Margin
(2.6
%)
(2.9
%)
30 bps
Adjusted EBITDA
$
46.7
$
48.6
(3.9
%)
Adjusted EBITDA Margin
7.5
%
7.4
%
10 bps
Adjusted Net Income (Loss)
$
3.0
$
(1.2
)
350.0
%
Basic (Loss) per Share
$
(0.27
)
$
(0.20
)
(35.0
%)
Weighted average number of common shares
outstanding
94.0
93.3
0.8
%
Adjusted Earnings (Loss) per Share
$
0.02
$
(0.01
)
300.0
%
Adjusted weighted average number of common
shares outstanding
148.2
93.3
58.8
%
Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income,
Adjusted Earnings per Share, and Adjusted weighted average number
of common shares outstanding are non-GAAP measures. Refer to the
“Non-GAAP Financial Measures” and “Reconciliation of GAAP to
Non-GAAP Financial Measures” sections for more information.
For the first quarter of fiscal 2024, total revenue decreased
4.5% to $626.7 million driven by a $22.1 million decrease in snow
removal revenue and an $18.8 million decrease in our commercial
landscaping business. These decreases were partially offset by an
increase of $11.0 million in Development services organic revenues
year-over-year.
Fiscal 2024 Results – Segments
Maintenance Services - Operating
Highlights
Three Months Ended December
31,
($ in millions)
2023
2022
Change
Landscape Maintenance
$
402.6
$
421.4
(4.5%)
Snow Removal
$
39.7
$
61.8
(35.8%)
Total Revenue
$
442.3
$
483.2
(8.5%)
Adjusted EBITDA
$
42.0
$
50.5
(16.8%)
Adjusted EBITDA Margin
9.5
%
10.5
%
(100) bps
Capital Expenditures
$
7.7
$
24.0
(67.9%)
For the first quarter of fiscal 2024, revenue in the Maintenance
Services Segment decreased by $40.9 million, or 8.5%, from the
prior year. Snow removal services revenue decreased $22.1 million,
primarily due to lower snowfall relative to the prior period1.
Commercial landscaping services decreased $18.8 million, or 4.5%,
largely underpinned by a decline in our ancillary services
business.
Adjusted EBITDA for the Maintenance Services Segment for the
three months ended December 31, 2023 decreased by $8.5 million to
$42.0 million from $50.5 million in the 2023 period. Segment
Adjusted EBITDA Margin decreased 100 basis points, to 9.5%, in the
three months ended December 31, 2023, from 10.5% in the 2022
period. The decreases in Segment Adjusted EBITDA and Segment
Adjusted EBITDA Margin were principally driven by the decreases in
net service revenues described above, partially offset by decreased
labor-related costs.
1 As defined by the National Oceanic Atmospheric Administration,
U.S. Department of Commerce (“NOAA”) for the Company's footprint
during the respective three-month periods
Development Services - Operating
Highlights
Three Months Ended December
31,
($ in millions)
2023
2022
Change
Revenue
$
185.4
$
174.4
6.3%
Adjusted EBITDA
$
19.6
$
16.5
18.8%
Adjusted EBITDA Margin
10.6
%
9.5
%
110 bps
Capital Expenditures
$
1.2
$
2.0
(40.0%)
For the first quarter of fiscal 2024, revenue in the Development
Services Segment increased by $11.0 million, or 6.3%, compared to
the prior year. The increase was principally driven by an increase
in Development Services project volumes of $11.0 million.
Adjusted EBITDA for the Development Services Segment for the
three months ended December 31, 2023 increased $3.1 million, to
$19.6 million, compared to the prior year. Segment Adjusted EBITDA
Margin increased 110 basis points, to 10.6% for the quarter from
9.5% in the prior year. The increases in Segment Adjusted EBITDA
and Segment Adjusted EBITDA Margin were primarily driven by the
increase in net service revenues described above, coupled with
savings primarily from cost management initiatives.
Total BrightView Cash Flow
Metrics
Three Months Ended December
31,
($ in millions)
2023
2022
Change
Net Cash Provided (Used) by Operating
Activities
$
26.2
$
(29.6
)
188.5%
Free Cash Flow
$
17.3
$
(55.4
)
131.2%
Capital Expenditures
$
10.1
$
27.2
(62.9%)
Net cash provided by operating activities for the three months
ended December 31, 2023 increased $55.8 million, to an inflow of
$26.2 million, from an outflow of $29.6 million in the prior year.
This increase was due to increases in cash provided by accounts
receivable, and unbilled and deferred revenue. This was partially
offset by an increase in cash used by accounts payable and other
operating liabilities, and other operating assets.
Free Cash Flow increased $72.7 million to an inflow of $17.3
million for the three months ended December 31, 2023 from an
outflow of $55.4 million in the prior year. The increase in Free
Cash Flow was due to an increase in net cash provided by operating
activities coupled with a decrease in cash used for capital
expenditures, each as described below.
For the three months ended December 31, 2023, capital
expenditures were $10.1 million, compared with $27.2 million in the
prior year.
Total BrightView Balance Sheet
Metrics
($ in millions)
December 31, 2023
September 30, 2023
December 31, 2022
Total Financial Debt1
$
924.1
$
937.5
$
1,476.5
Minus:
Total Cash & Equivalents
64.5
67.0
22.4
Total Net Financial Debt2
$
859.6
$
870.5
$
1,454.1
Total Net Financial Debt to Adjusted
EBITDA ratio3
2.9x
2.9x
4.9x
1Total Financial Debt includes total
long-term debt, net of original issue discount, and finance lease
obligations
2Total Net Financial Debt equals Total
Financial Debt minus Total Cash & Equivalents
3Total Net Financial Debt to Adjusted
EBITDA ratio equals Total Net Financial Debt divided by the
trailing twelve month Adjusted EBITDA.
As of December 31, 2023, the Company’s Total Net Financial Debt
was $859.6 million, a decrease of 10.8 million compared to $870.5
million as of September 30, 2023. The company's Total Net Financial
Debt to Adjusted EBITDA ratio was 2.9x as of December 31, 2023, and
September 30, 2023.
Conference Call Information
A conference call to discuss the first quarter fiscal 2024
financial results is scheduled for February 1, 2024, at 8:30 a.m.
ET. The U.S. toll free dial-in for the conference call is (833)
470-1428 and the international dial-in is +1 (929) 526-1599. The
Conference ID is 982389. A live audio webcast of the conference
call will be available on the Company’s investor website
www.Investor.Brightview.com, where presentation materials will be
posted prior to the call.
A replay of the call will be available until 11:59 p.m. ET on
February 8, 2025. To access the recording, dial (929) 458-6194
(Conference ID 627917).
About BrightView
BrightView (NYSE: BV), the nation’s largest commercial
landscaper, proudly designs, creates, and maintains the best
landscapes on Earth and provides the most efficient and
comprehensive snow and ice removal services. With a dependable
service commitment, BrightView brings brilliant landscapes to life
at premier properties across the United States, including business
parks and corporate offices, homeowners' associations, healthcare
facilities, educational institutions, retail centers, resorts and
theme parks, municipalities, golf courses, and sports venues.
BrightView also serves as the Official Field Consultant to Major
League Baseball. Through industry-leading best practices and
sustainable solutions, BrightView is invested in taking care of our
team members, engaging our clients, inspiring our communities, and
preserving our planet. Visit www.BrightView.com and connect with us
on X (formerly known as Twitter), Facebook, and LinkedIn.
Forward Looking Statements
This press release contains forward looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended,
that involve substantial risks and uncertainties. All statements,
other than statements of historical facts, contained in this
presentation, including statements relating to our fiscal 2024
guidance and other statements related to our goals, beliefs,
business outlook, business trends, expectations regarding our
industry, strategy, future events, future operations, future
liquidity and financial position, future revenues, projected costs,
prospects, plans and objectives of management, are forward-looking
statements. Words such as “outlook,” “guidance,” “projects,”
“continues,” “believes,” “expects,” “may,” “will,” “should,”
“seeks,” “intends,” “plans,” “estimates,” or “anticipates,” or the
negative variations of these words or similar expressions are
intended to identify forward-looking statements, although not all
forward-looking statements contain these identifying words. By
their nature, forward-looking statements: speak only as of the date
they are made; are not statements of historical fact or guarantees
of future performance, and are based upon our current expectations,
beliefs, estimates and projections, and various assumptions, many
of which are subject to risks, uncertainties, assumptions, changes
in circumstances or other factors outside of the Company’s control
that are difficult to predict or quantify. Our expectations,
beliefs, and projections are expressed in good faith and we believe
there is a reasonable basis for them. However, there can be no
assurance that management’s expectations, beliefs and projections
will result or be achieved and actual results may vary materially
from what is expressed in or indicated by the forward-looking
statements. Factors that could cause actual results to differ
materially from those projected include, but are not limited to:
general business, economic and financial conditions; increases in
raw material costs, fuel prices, wages and other operating costs,
and changes in our ability to source adequate supplies and
materials in a timely manner; competitive industry pressures; the
failure to retain current customers, renew existing customer
contracts and obtain new customer contracts; the failure to enter
into profitable contracts, or maintaining customer contracts that
are unprofitable; a determination by customers to reduce their
outsourcing or use of preferred vendors; the dispersed nature of
our operating structure; our ability to implement our business
strategies and achieve our growth objectives; the possibility that
the anticipated benefits from our business acquisitions will not be
realized in full or at all or may take longer to realize than
expected; the possibility that costs or difficulties related to the
integration of acquired businesses’ operations will be greater than
expected and the possibility that integration efforts will disrupt
our business and strain management time and resources; the seasonal
nature of our landscape maintenance services; our dependence on
weather conditions and the impact of severe weather and climate
change on our business; any failure to accurately estimate the
overall risk, requirements, or costs when we bid on or negotiate
contracts that are ultimately awarded to us; the conditions and
periodic fluctuations of real estate markets, including residential
and commercial construction; the level, timing and location of
snowfall; our ability to retain or hire our executive management
and other key personnel; our ability to attract and retain field
and hourly employees, trained workers and third-party contractors
and re-employ seasonal workers; any failure to properly verify
employment eligibility of our employees; subcontractors taking
actions that harm our business; our recognition of future
impairment charges; laws and governmental regulations, including
those relating to employees, wage and hour, immigration, human
health and safety and transportation; environmental, health and
safety laws and regulations, including regulatory costs, claims and
litigation related to the use of chemicals and pesticides by
employees and related third-party claims; the distraction and
impact caused by litigation, of adverse litigation judgments and
settlements resulting from legal proceedings; tax increases and
changes in tax rules; increase in on-job accidents involving
employees; any failure, inadequacy, interruption, security failure
or breach of our information technology systems; our failure to
comply with data privacy regulations; our ability to adequately
protect our intellectual property; our substantial indebtedness;
increases in interest rates governing our variable rate
indebtedness increasing the cost of servicing our substantial
indebtedness; risks related to counterparty credit worthiness or
non-performance of the derivative financial instruments we utilize;
restrictions imposed by our debt agreements that limit our
flexibility in operating our business; our ability to generate
sufficient cash flow to satisfy our significant debt service
obligations; our ability to obtain additional financing to fund
future working capital, capital expenditures, investments or
acquisitions, or other general corporate requirements; any future
sales, or the perception of future sales, of common stock by us or
our affiliates, which could cause the market price for our common
stock to decline; the ability of KKR BrightView Aggregator L.P.,
Birch-OR Equity Holdings, LLC and Birch Equity Holdings, LP, which
collectively hold approximately 71% of our shares as of December
31, 2023, to exert significant influence over us; the impact of
holders of Series A Preferred Stock having different interests
from, and certain voting rights that may be voted in a manner
deemed adverse to, holders of our common stock; the dividend,
liquidation, and redemption rights of the holders of our Series A
Preferred Stock; risks related to natural disasters, terrorist
attacks, public health emergencies, including pandemics, heightened
inflation, geopolitical conflicts, recession, financial market
disruptions, other economic conditions, and other external events;
our ability to pursue and achieve our environmental, social and
corporate governance goals and targets and the possibility that
complying with such standards and meeting our goals may be
significantly more costly than anticipated; and costs and
requirements imposed as a result of maintaining compliance with the
requirements of being a public company. Additional factors that
could cause our results to differ materially from those described
in the forward-looking statements can be found under “Item 1A. Risk
Factors” in our Form 10-K for the fiscal year ended September 30,
2023, and such factors may be updated from time to time in our
periodic filings with the Securities and Exchange Commission (the
“SEC”), which are accessible on the SEC’s website at www.sec.gov.
Accordingly, there are or will be important factors that could
cause actual outcomes or results to differ materially from those
indicated in these statements. These factors should not be
construed as exhaustive and should be read in conjunction with the
other cautionary statements that are included in this release and
in our filings with the SEC. Any forward-looking statement made in
this press release speaks only as of the date on which it was made.
We undertake no obligation to publicly update or review any
forward-looking statement, whether as a result of new information,
future developments or otherwise, except as required by law.
Non-GAAP Financial Measures
To supplement the Company’s financial information presented in
accordance with GAAP and aid understanding of the Company’s
business performance, the Company uses certain non-GAAP financial
measures, namely “Adjusted EBITDA”, “Adjusted EBITDA Margin”,
“Adjusted Net Income (Loss)”, “Adjusted Earnings (Loss) per Share”,
“Free Cash Flow”, “Total Financial Debt”, “Total Net Financial
Debt” and “Total Net Financial Debt to Adjusted EBITDA ratio”. We
believe Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net
Income (Loss), Adjusted Earnings (Loss) per Share, Free Cash Flow,
Total Financial Debt, Total Net Financial Debt, and Total Net
Financial Debt to Adjusted EBITDA ratio assist investors in
comparing our results across reporting periods on a consistent
basis by excluding items that we do not believe are indicative of
our core operating performance. Management believes these non-GAAP
financial measures are useful to investors in highlighting trends
in our operating performance, while other measures can differ
significantly depending on long-term strategic decisions regarding
capital structure, the tax jurisdictions in which we operate and
capital investments. Management regularly uses these measures as
tools in evaluating our operating performance, financial
performance and liquidity. Management uses Adjusted EBITDA,
Adjusted EBITDA Margin, Adjusted Net Income (Loss), Adjusted
Earnings (Loss) per Share, Free Cash Flow, Total Financial Debt,
Total Net Financial Debt, and Total Net Financial Debt to Adjusted
EBITDA ratio to supplement comparable GAAP measures in the
evaluation of the effectiveness of our business strategies, to make
budgeting decisions, to establish discretionary annual incentive
compensation and to compare our performance against that of other
peer companies using similar measures. In addition, we believe that
Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income
(Loss), Adjusted Earnings (Loss) per Share, Free Cash Flow, Total
Financial Debt, Total Net Financial Debt, and Total Net Financial
Debt to Adjusted EBITDA ratio are frequently used by investors and
other interested parties in the evaluation of issuers, many of
which also present Adjusted EBITDA, Adjusted EBITDA Margin,
Adjusted Net Income (Loss), Adjusted Earnings (Loss) per Share,
Free Cash Flow, Total Financial Debt, Total Net Financial Debt, and
Total Net Financial Debt to Adjusted EBITDA ratio when reporting
their results in an effort to facilitate an understanding of their
operating and financial results and liquidity. Management
supplements GAAP results with non-GAAP financial measures to
provide a more complete understanding of the factors and trends
affecting the business than GAAP results alone.
Adjusted EBITDA: We define Adjusted EBITDA as net (loss) income
before interest, taxes, depreciation and amortization, as further
adjusted to exclude certain non-cash, non-recurring and other
adjustment items.
Adjusted EBITDA Margin: We define Adjusted EBITDA Margin as
Adjusted EBITDA, defined above, divided by Net Service
Revenues.
Adjusted Net Income (Loss): We define Adjusted Net Income (Loss)
as net (loss) including interest and depreciation, and excluding
other items used to calculate Adjusted EBITDA and further adjusted
for the tax effect of these exclusions and the removal of the
discrete tax items.
Adjusted Earnings (Loss) per Share: We define Adjusted Earnings
(Loss) per Share as Adjusted Net Income (Loss) divided by the
Adjusted Weighted Average Number of Common Shares Outstanding.
Adjusted Weighted Average Number of Common Shares Outstanding:
We define Adjusted Weighted Average Number of Common Shares
Outstanding as the weighted average number of common shares
outstanding used in the calculation of basic earnings per share
plus shares of common stock related to the Series A Preferred Stock
on an as-converted basis, assumed to be converted for the entire
period. The addition of shares of common stock related to the
Series A Convertible Preferred Stock on an as-converted basis
reflects the dilutive impact of the potential conversion of the
Series A Preferred Stock and is expected to provide comparability
in future periods.
Free Cash Flow: We define Free Cash Flow as cash flows from
operating activities less capital expenditures, net of proceeds
from the sale of property and equipment.
Total Financial Debt: We define Total Financial Debt as total
long-term debt, net of original issue discount, and finance lease
obligations.
Total Net Financial Debt: We define Total Net Financial Debt as
Total Financial Debt minus total cash and cash equivalents.
Total Net Financial Debt to Adjusted EBITDA ratio: We define
Total Net Financial Debt to Adjusted EBITDA ratio as Total Net
Financial Debt divided by the trailing twelve month Adjusted
EBITDA.
Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income
(Loss), Adjusted Earnings (Loss) per Share, Free Cash Flow, Total
Financial Debt, Total Net Financial Debt, and Total Net Financial
Debt to Adjusted EBITDA ratio are not recognized terms under GAAP
and should not be considered as an alternative to net (loss) or the
ratio of net (loss) to net revenue as a measure of financial
performance, cash flows provided by operating activities as a
measure of liquidity, or any other performance measure derived in
accordance with GAAP. Additionally, these measures are not intended
to be a measure of free cash flow available for management’s
discretionary use as they do not consider certain cash requirements
such as interest payments, tax payments and debt service
requirements. The presentations of these measures have limitations
as analytical tools and should not be considered in isolation, or
as a substitute for analysis of our results as reported under GAAP.
Because not all companies use identical calculations, the
presentations of these measures may not be comparable to the same
or other similarly titled measures of other companies and can
differ significantly from company to company.
BrightView Holdings,
Inc.
Consolidated Balance
Sheets
(Unaudited)
(in millions)*
December 31, 2023
September 30, 2023
Assets
Current assets:
Cash and cash equivalents
$
64.5
$
67.0
Accounts receivable, net
418.9
442.3
Unbilled revenue
107.8
143.5
Other current assets
99.7
89.3
Total current assets
690.9
742.1
Property and equipment, net
302.8
315.2
Intangible assets, net
122.1
132.3
Goodwill
2,021.5
2,021.4
Operating lease assets
86.0
86.1
Other assets
40.2
55.1
Total assets
$
3,263.5
$
3,352.2
Liabilities and stockholders’
equity
Current liabilities:
Accounts payable
$
120.2
$
136.2
Deferred revenue
90.9
68.2
Current portion of self-insurance
reserves
53.4
54.8
Accrued expenses and other current
liabilities
129.5
180.2
Current portion of operating lease
liabilities
27.2
27.3
Total current liabilities
421.2
466.7
Long-term debt, net
879.8
888.1
Deferred tax liabilities
41.0
51.1
Self-insurance reserves
108.1
105.1
Long-term operating lease liabilities
65.2
65.1
Other liabilities
33.0
34.6
Total liabilities
1,548.3
1,610.7
Mezzanine equity:
Series A convertible preferred shares,
$0.01 par value, 7% cumulative dividends; 500,000 shares issued and
outstanding as of December 31, 2023 and September 30, 2023,
aggregate liquidation preference of $512.0 and $503.2 as of
December 31, 2023 and September 30, 2023, respectively
507.1
498.2
Stockholders’ equity:
Preferred stock, $0.01 par value;
50,000,000 shares authorized; no shares issued or outstanding as of
December 31, 2023 and September 30, 2023
—
—
Common stock, $0.01 par value; 500,000,000
shares authorized; 107,800,000 and 106,600,000 shares issued and
94,400,000 and 93,600,000 shares outstanding as of December 31,
2023 and September 30, 2023, respectively
1.1
1.1
Treasury stock, at cost; 13,400,000 and
13,000,000 shares as of December 31, 2023 and September 30, 2023,
respectively
(172.9
)
(170.4
)
Additional paid-in capital
1,527.4
1,530.8
Accumulated deficit
(151.7
)
(135.3
)
Accumulated other comprehensive income
4.2
17.1
Total stockholders’ equity
1,208.1
1,243.3
Total liabilities, mezzanine equity and
stockholders’ equity
$
3,263.5
$
3,352.2
(*) Amounts may not total due to
rounding.
BrightView Holdings,
Inc.
Consolidated Statements of
Operations
(Unaudited)
Three Months Ended December
31,
2023
2022
(in millions)*
Net service revenues
$
626.7
$
655.9
Cost of services provided
492.9
508.3
Gross profit
133.8
147.6
Selling, general and administrative
expense
129.9
137.6
Amortization expense
10.1
11.9
(Loss) income from operations
(6.2
)
(1.9
)
Other (income)
(1.2
)
(0.7
)
Interest expense
17.1
23.2
(Loss) before income taxes
(22.1
)
(24.4
)
Income tax (benefit)
(5.7
)
(5.5
)
Net (loss)
$
(16.4
)
$
(18.9
)
Less: dividends on Series A convertible
preferred shares
8.9
-
Net (loss) attributable to common
stockholders
$
(25.3
)
$
(18.9
)
(Loss) per share:
Basic and diluted (loss) per share
$
(0.27
)
$
(0.20
)
BrightView Holdings,
Inc.
Segment Reporting
(Unaudited)
Three Months Ended December
31,
2023
2022
(in millions)*
Maintenance Services
$
442.3
$
483.2
Development Services
185.4
174.4
Eliminations
(1.0
)
(1.7
)
Net Service Revenues
$
626.7
$
655.9
Maintenance Services
$
42.0
$
50.5
Development Services
19.6
16.5
Corporate
(14.9
)
(18.4
)
Adjusted EBITDA
$
46.7
$
48.6
Maintenance Services
$
7.7
$
24.0
Development Services
1.2
2.0
Corporate
1.2
1.2
Capital Expenditures
$
10.1
$
27.2
(*) Amounts may not total due to
rounding.
BrightView Holdings,
Inc.
Consolidated Statements of
Cash Flows
(Unaudited)
Three Months Ended December
31,
2023
2022
(in millions)*
Cash flows from operating activities:
Net (loss)
$
(16.4
)
$
(18.9
)
Adjustments to reconcile net (loss) to net
cash provided (used) by operating activities:
Depreciation
25.6
27.1
Amortization of intangible assets
10.1
11.9
Amortization of financing costs and
original issue discount
0.7
0.9
Deferred taxes
(6.7
)
(8.3
)
Equity-based compensation
5.1
5.6
Realized (gain) on hedges
(2.9
)
(3.0
)
Other non-cash activities
1.9
0.6
Change in operating assets and
liabilities:
Accounts receivable
21.0
(15.6
)
Unbilled and deferred revenue
58.4
23.7
Other operating assets
(9.9
)
(5.8
)
Accounts payable and other operating
liabilities
(60.7
)
(47.8
)
Net cash provided (used) by operating
activities
26.2
(29.6
)
Cash flows from investing activities:
Purchase of property and equipment
(10.1
)
(27.2
)
Proceeds from sale of property and
equipment
1.2
1.4
Business acquisitions, net of cash
acquired
—
(10.0
)
Other investing activities
0.3
0.8
Net cash (used) by investing
activities
(8.6
)
(35.0
)
Cash flows from financing activities:
Repayments of finance lease
obligations
(7.5
)
(8.7
)
Repayments of term loan
—
(3.0
)
Repayments of receivables financing
agreement
(9.5
)
(114.0
)
Proceeds from receivables financing
agreement, net of issuance costs
0.5
171.0
Proceeds from revolving credit
facility
—
24.0
Debt issuance and prepayment costs
(0.4
)
—
Proceeds from issuance of common stock,
net of share issuance costs
0.2
0.3
Repurchase of common stock and
distributions
(2.5
)
(1.2
)
Contingent business acquisition
payments
(1.0
)
(1.6
)
Other financing activities
0.1
0.1
Net cash (used) provided by financing
activities
(20.1
)
66.9
Net change in cash and cash
equivalents
(2.5
)
2.3
Cash and cash equivalents, beginning of
period
67.0
20.1
Cash and cash equivalents, end of
period
$
64.5
$
22.4
Supplemental Cash Flow
Information:
Cash (received) paid for income taxes,
net
$
(0.2
)
$
—
Cash paid for interest
$
18.0
$
21.7
Non-cash Series A Preferred Stock
dividends
$
8.9
$
—
(*) Amounts may not total due to
rounding.
BrightView Holdings,
Inc.
Reconciliation of GAAP to
Non-GAAP Financial Measures
(Unaudited)
Three Months Ended December
31,
(in millions)*
2023
2022
Adjusted EBITDA
Net (loss)
$
(16.4
)
$
(18.9
)
Plus:
Interest expense, net
17.1
23.2
Income tax (benefit)
(5.7
)
(5.5
)
Depreciation expense
25.6
27.1
Amortization expense
10.1
11.9
Business transformation and integration
costs (a)
10.7
4.7
Equity-based compensation (b)
5.3
5.7
COVID-19 related expenses (c)
—
0.4
Adjusted EBITDA
$
46.7
$
48.6
Adjusted Net Income (Loss)
Net (loss)
$
(16.4
)
$
(18.9
)
Plus:
Amortization expense
10.1
11.9
Business transformation and integration
costs (a)
10.7
4.7
Equity-based compensation (b)
5.3
5.7
COVID-19 related expenses (c)
—
0.4
Income tax adjustment (d)
(6.7
)
(5.0
)
Adjusted Net Income (Loss)
$
3.0
$
(1.2
)
Free Cash Flow
Cash flows provided by operating
activities
$
26.2
$
(29.6
)
Minus:
Capital expenditures
10.1
27.2
Plus:
Proceeds from sale of property and
equipment
1.2
1.4
Free Cash Flow
$
17.3
$
(55.4
)
Adjusted Earnings per Share
Numerator:
Adjusted Net Income (Loss)
$
3.0
$
(1.2
)
Denominator:
—
—
Weighted average number of common shares
outstanding – basic and diluted
93,986,000
93,252,000
Plus:
Dilutive impact of Series A convertible
preferred stock as-converted
54,242,000
—
Adjusted weighted average number of common
shares outstanding
148,228,000
93,252,000
Adjusted Earnings per Share
$
0.02
$
(0.01
)
(*) Amounts may not total due to
rounding.
BrightView Holdings,
Inc.
Reconciliation of GAAP to
Non-GAAP Financial Measures
(Unaudited)
(a)
Business transformation and integration
costs consist of (i) severance and related costs; (ii) business
integration costs and (iii) information technology infrastructure,
transformation costs, and other.
Three Months Ended December
31,
(in millions)*
2023
2022
Severance and related costs
$
2.5
$
0.1
Business integration (e)
0.6
2.7
IT infrastructure, transformation, and
other (f)
7.6
1.9
Business transformation and integration
costs
$
10.7
$
4.7
(b)
Represents equity-based compensation
expense and related taxes recognized for equity incentive plans
outstanding.
(c)
Represents expenses related to the
Company’s response to the COVID-19 pandemic, principally temporary
and incremental salary and related expenses, personal protective
equipment and cleaning and supply purchases, and other.
(d)
Represents the tax effect of pre-tax items
excluded from Adjusted Net Income (Loss) and the removal of the
applicable discrete tax items, which collectively result in a
reduction of income tax (benefit). The tax effect of pre-tax items
excluded from Adjusted Net Income (Loss) is computed using the
statutory rate related to the jurisdiction that was impacted by the
adjustment after taking into account the impact of permanent
differences and valuation allowances. Discrete tax items include
changes in laws or rates, changes in uncertain tax positions
relating to prior years and changes in valuation allowances.
Three Months Ended December
31,
(in millions)*
2023
2022
Tax impact of pre-tax income
adjustments
$
7.4
$
6.0
Discrete tax items
(0.7
)
(1.0
)
Income tax adjustment
$
6.7
$
5.0
(e)
Represents isolated expenses specifically
related to the integration of acquired companies such as one-time
employee retention costs, employee onboarding and training costs,
and fleet and uniform rebranding costs. The Company excludes
Business integration costs from the measures disclosed above since
such expenses vary in amount due to the number of acquisitions and
size of acquired companies as well as factors specific to each
acquisition, and as a result lack predictability as to occurrence
and/or timing, and create a lack of comparability between
periods.
(f)
Represents expenses related to distinct
initiatives, typically significant enterprise-wide changes. Such
expenses are excluded from the measures disclosed above since such
expenses vary in amount based on occurrence as well as factors
specific to each of the activities, are outside of the normal
operations of the business, and create a lack of comparability
between periods.
Total Financial Debt and Total Net
Financial Debt
(in millions)*
December 31, 2023
September 30, 2023
December 31, 2022
Long-term debt, net
$
879.8
$
888.1
$
1,409.5
Plus:
Current portion of long term debt
—
—
12.0
Financing costs, net
6.1
6.6
10.2
Present value of net minimum payment -
finance lease obligations (g)
38.2
42.8
44.8
Total Financial Debt
924.1
937.5
1,476.5
Less: Cash and cash equivalents
(64.5
)
(67.0
)
(22.4
)
Total Net Financial Debt
$
859.6
$
870.5
$
1,454.1
Total Net Financial Debt to Adjusted
EBITDA ratio
2.9x
2.9x
4.9x
g. Balance is presented within Accrued
expenses and other current liabilities and Other liabilities in the
Consolidated Balance Sheet.
(*) Amounts may not total due to
rounding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240131619292/en/
Investor Relations IR@BrightView.com
News Media David Freireich, Vice President of
Communications & Public Affairs
David.Freireich@BrightView.com
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