Rollins, Inc. Reports Strong Q3 and Nine-Month Financial Performance with Revenue and Profit Growth

Rollins, Inc. reported strong financial performance for the third quarter and the nine months ended September 30, 2024, with notable increases in revenue, profitability, and strategic acquisitions.

For the three months ended September 30, 2024, Rollins generated revenues of $916.3 million, a 9.0% increase from $840.4 million in the same period of 2023. The nine-month revenue also rose to $2.56 billion, up 10.2% from $2.32 billion year-over-year. Organic revenue growth was 7.7%, with acquisitions contributing an additional 2.1%. The residential pest control segment saw a 6.4% increase in revenue, while commercial pest control grew by 9.4%. Termite and ancillary services experienced a significant 14.5% increase.

Operating income for the third quarter was $191.8 million, reflecting an 8.3% increase from $177.1 million in Q3 2023. For the nine months, operating income rose to $506.6 million, a 14.1% increase from $444.2 million in the prior year. Net income for the third quarter was $136.9 million, up 7.1% from $127.8 million, while year-to-date net income reached $360.7 million, a 10.6% increase from $326.2 million.

The company’s total operating expenses for the third quarter increased to $724.5 million from $663.3 million in the prior year, driven by higher sales, general, and administrative (SG&A) expenses, which rose by 12.3% to $274.9 million. Despite this increase, the gross profit margin improved to 54.0% from 53.8% year-over-year, aided by effective pricing strategies that offset inflationary pressures.

Rollins made significant strategic moves, completing 32 acquisitions during the nine months, with a total preliminary consideration of $119.9 million. A notable acquisition was Fox Pest Control, finalized on April 1, 2023, for $339.5 million, which included cash payments of $302.8 million. The acquisition is expected to enhance Rollins' market position and contribute to future revenue growth.

Cash flow from operating activities for the nine months ended September 30, 2024, was $419.5 million, an increase of 11.7% from $375.5 million in 2023. The company reported a decrease in cash used in investing activities to $123.6 million from $362.3 million, primarily due to reduced acquisition-related expenditures.

As of September 30, 2024, Rollins had total assets of $2.82 billion, up from $2.60 billion at the end of 2023, and total stockholders' equity increased to $1.32 billion from $1.16 billion. The company maintained compliance with its debt covenants, with a net leverage ratio of 0.5x, improved from 0.6x at the end of 2023.