Rollins Inc. (ROL, Financial) filed Quarterly Report for the period ended 2009-03-31.
Rollins Inc. provides services to both residential and commercial customers. The four primary services provided are termite and pest control protective services lawn care and plantscaping. Orkin Exterminating Company Inc. a wholly owned subsidiary (Orkin) is one of the world's largest termite and pest control companies. Rollins Protective Services a division of the Registrant is a pioneer in developing customized wired and wireless electronic security systems. Rollins Inc. has a market cap of $1.8 billion; its shares were traded at around $18 with a P/E ratio of 25.7 and P/S ratio of 1.8. The dividend yield of Rollins Inc. stocks is 1.6%. Rollins Inc. had an annual average earning growth of 13.2% over the past 5 years.
Depreciation and Amortization expenses for the first quarter ended March 31, 2009 increased to $9.4 million, an increase of 42.2% or $2.8 million versus the prior year first quarter. Amortization of intangibles from acquisitions made last year after the first quarter accounted for $2.1 million of the increase and depreciation from those acquisitions account for $0.3 million of the increase in depreciation
The Company invested approximately $3.5 million in capital expenditures during the first three months ended March 31, 2009, compared to $2.8 million during the same period in 2008, and expects to invest approximately $10.0 million for the remainder of 2009. Capital expenditures for the first three months consisted primarily of the purchase of equipment replacements and technology related projects. During the first three months ended March 31, 2009, the Company made expenditures for acquisitions totaling $1.5 million, compared to $1.4 million during the same period in 2008. Cash on hand and borrowings
under a senior unsecured revolving credit facility primarily funded expenditures for acquisitions. A total of $7.0 million was paid in cash dividends ($0.07 per share) during the first three months of 2009, compared to $6.3 million or ($0.0625 per share) during the same period in 2008. The Company repurchased 603,400 shares during the first quarter of 2009 of its $1 par value common stock at a weighted average price of $15.19. The capital expenditures and cash dividends were funded through existing cash balances, operating activities and borrowings under a senior unsecured revolving credit facility. The Company continues to seek new acquisitions.
On March 28, 2008, the Company entered into a definitive Asset Purchase Agreement dated as of March 28, 2008 to acquire, through the purchase of assets, the business of HomeTeam Pest Defense, which provides termite and pest control services to homebuilders, businesses and homeowners. The aggregate amount paid was a combination of $47.7 million in cash on hand, as well as $90.0 million in borrowings from the below mentioned credit facility, totaling $137.7 million. The Company closed the purchase of the HomeTeam Pest Defense acquisition on April 3, 2008. Through the period ended March 31, 2009, the Company paid back, $28.0 million of the $90.0 million that was borrowed to fund the HomeTeam acquisition.
On March 28, 2008, the Company entered into a Revolving Credit Agreement with SunTrust Bank and Bank of America, N.A. for an unsecured line of credit of up to $175 million, which includes a $75 million letter of credit subfacility, and a $10 million swingline subfacility. As March 31, 2009, borrowings of $60.0 million were outstanding under the line of credit and borrowings of $2.0 million were outstanding under the swingline subfacility. The Company maintains approximately $35.4 million in letters of credit, which reduces its borrowing capacity under the credit facility. These letters of credit are required by the Companys fronting insurance companies and/or certain states, due to the Companys self-insured status, to secure various workers compensation and casualty insurance contracts, although the Company believes that it has adequate liquid assets, funding sources and insurance accruals to accommodate such claims. The Revolving Credit Agreement is guaranteed by certain of Rollins domestic subsidiaries. The maturity date of the Credit Agreement is March 27, 2013. Outstanding balances of individual tranches under the Credit Agreement currently mature in 2009. Revolving loans under the Revolving Credit Agreement bear interest at one of the following two rates, at the Companys election:
Read the The complete ReportROL is in the portfolios of Richard Aster Jr of Meridian Fund.
Rollins Inc. provides services to both residential and commercial customers. The four primary services provided are termite and pest control protective services lawn care and plantscaping. Orkin Exterminating Company Inc. a wholly owned subsidiary (Orkin) is one of the world's largest termite and pest control companies. Rollins Protective Services a division of the Registrant is a pioneer in developing customized wired and wireless electronic security systems. Rollins Inc. has a market cap of $1.8 billion; its shares were traded at around $18 with a P/E ratio of 25.7 and P/S ratio of 1.8. The dividend yield of Rollins Inc. stocks is 1.6%. Rollins Inc. had an annual average earning growth of 13.2% over the past 5 years.
Highlight of Business Operations:
Depreciation and amortization expenses for the first quarter ended March 31, 2009 increased to $9.4 million, an increase of 42.2% or $2.8 million versus the prior year first quarter. Amortization of intangibles from acquisitions made last year after the first quarter accounted for $2.1 million of the increase and depreciation from those acquisitions account for $0.3 million of the increase in depreciation.Depreciation and Amortization expenses for the first quarter ended March 31, 2009 increased to $9.4 million, an increase of 42.2% or $2.8 million versus the prior year first quarter. Amortization of intangibles from acquisitions made last year after the first quarter accounted for $2.1 million of the increase and depreciation from those acquisitions account for $0.3 million of the increase in depreciation
The Company invested approximately $3.5 million in capital expenditures during the first three months ended March 31, 2009, compared to $2.8 million during the same period in 2008, and expects to invest approximately $10.0 million for the remainder of 2009. Capital expenditures for the first three months consisted primarily of the purchase of equipment replacements and technology related projects. During the first three months ended March 31, 2009, the Company made expenditures for acquisitions totaling $1.5 million, compared to $1.4 million during the same period in 2008. Cash on hand and borrowings
under a senior unsecured revolving credit facility primarily funded expenditures for acquisitions. A total of $7.0 million was paid in cash dividends ($0.07 per share) during the first three months of 2009, compared to $6.3 million or ($0.0625 per share) during the same period in 2008. The Company repurchased 603,400 shares during the first quarter of 2009 of its $1 par value common stock at a weighted average price of $15.19. The capital expenditures and cash dividends were funded through existing cash balances, operating activities and borrowings under a senior unsecured revolving credit facility. The Company continues to seek new acquisitions.
On March 28, 2008, the Company entered into a definitive Asset Purchase Agreement dated as of March 28, 2008 to acquire, through the purchase of assets, the business of HomeTeam Pest Defense, which provides termite and pest control services to homebuilders, businesses and homeowners. The aggregate amount paid was a combination of $47.7 million in cash on hand, as well as $90.0 million in borrowings from the below mentioned credit facility, totaling $137.7 million. The Company closed the purchase of the HomeTeam Pest Defense acquisition on April 3, 2008. Through the period ended March 31, 2009, the Company paid back, $28.0 million of the $90.0 million that was borrowed to fund the HomeTeam acquisition.
On March 28, 2008, the Company entered into a Revolving Credit Agreement with SunTrust Bank and Bank of America, N.A. for an unsecured line of credit of up to $175 million, which includes a $75 million letter of credit subfacility, and a $10 million swingline subfacility. As March 31, 2009, borrowings of $60.0 million were outstanding under the line of credit and borrowings of $2.0 million were outstanding under the swingline subfacility. The Company maintains approximately $35.4 million in letters of credit, which reduces its borrowing capacity under the credit facility. These letters of credit are required by the Companys fronting insurance companies and/or certain states, due to the Companys self-insured status, to secure various workers compensation and casualty insurance contracts, although the Company believes that it has adequate liquid assets, funding sources and insurance accruals to accommodate such claims. The Revolving Credit Agreement is guaranteed by certain of Rollins domestic subsidiaries. The maturity date of the Credit Agreement is March 27, 2013. Outstanding balances of individual tranches under the Credit Agreement currently mature in 2009. Revolving loans under the Revolving Credit Agreement bear interest at one of the following two rates, at the Companys election:
Read the The complete ReportROL is in the portfolios of Richard Aster Jr of Meridian Fund.
