Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2020 | Feb. 24, 2021 | Jun. 30, 2020 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Document Transition Report | false | ||
Entity Registrant Name | Terminix Global Holdings, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-8738320 | ||
Entity Address, Address Line One | 150 Peabody Place | ||
Entity Address, City or Town | Memphis | ||
Entity Address, State or Province | TN | ||
Entity Address, Postal Zip Code | 38103 | ||
City Area Code | 901 | ||
Local Phone Number | 597-1400 | ||
Security 12b Title | Common stock, par value $0.01 per share | ||
Trading Symbol | TMX | ||
Security Exchange Name | NYSE | ||
Entity Voluntary Filers | No | ||
Entity Interactive Data Current | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 131,859,929 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Public Float | $ 4.7 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity File Number | 001-36507 | ||
Current Fiscal Year End Date | --12-31 | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001428875 | ||
Documents incorporated by reference | Documents incorporated by reference: Portions of the registrant’s proxy statement to be filed with the Securities and Exchange Commission in connection with the registrant’s 2021 annual meeting of stockholders (the “Proxy Statement”) are incorporated by reference into Part III hereof. Such Proxy Statement will be filed within 120 days of the registrant’s fiscal year ended December 31, 2020. |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue | $ 1,961 | $ 1,819 | $ 1,655 |
Cost of services rendered and products sold | 1,155 | 1,069 | 944 |
Selling and administrative expenses | 559 | 527 | 500 |
Amortization expense | 36 | 25 | 14 |
Acquisition-related costs | 16 | 4 | |
Termite damage claims reserve adjustment | 53 | ||
Realized (gain) loss on investment in frontdoor, inc. | (40) | 249 | |
Restructuring and other charges | 16 | 14 | 17 |
Interest expense | 83 | 87 | 133 |
Interest and net investment income | (4) | (5) | (6) |
Loss on extinguishment of debt | 26 | 8 | 10 |
Income (Loss) from Continuing Operations before Income Taxes | 41 | 64 | (214) |
Provision for income taxes | 24 | 5 | 14 |
Equity in earnings of joint ventures | 3 | ||
Income (Loss) from Continuing Operations | 20 | 60 | (227) |
Net earnings from discontinued operations | 531 | 69 | 186 |
Net Income (Loss) | 551 | 128 | (41) |
Other Comprehensive Income (Loss), Net of Income Taxes: | |||
Net unrealized (losses) gains on derivative instruments | (29) | (6) | 1 |
Foreign currency translation gain (loss) | (18) | 10 | (3) |
Other Comprehensive Income (Loss), Net of Income Taxes | (47) | 4 | (3) |
Total Comprehensive Income (Loss) | $ 504 | $ 132 | $ (44) |
Weighted-average common shares outstanding - Basic | 132.7 | 135.8 | 135.5 |
Weighted-average common shares outstanding - Diluted | 133 | 136.2 | 135.5 |
Basic Earnings Per Share: | |||
Income (Loss) from Continuing Operations (in dollars per share) | $ 0.15 | $ 0.44 | $ (1.68) |
Net earnings from discontinued operations (in dollars per share) | 4 | 0.50 | 1.37 |
Net Income (Loss) (in dollars per share) | 4.15 | 0.94 | (0.30) |
Diluted Earnings Per Share: | |||
Income (Loss) from Continuing Operations (in dollars per share) | 0.15 | 0.44 | (1.68) |
Net earnings from discontinued operations (in dollars per share) | 4 | 0.50 | 1.37 |
Net Income (Loss) (in dollars per share) | $ 4.14 | $ 0.94 | $ (0.30) |
Mobile Bay Formosan [Member] | |||
Litigation settlement | $ 49 | ||
Fumigation Related Matters [Member] | |||
Litigation settlement | $ 3 |
Consolidated Statements of Fina
Consolidated Statements of Financial Position - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 | |
Current Assets: | |||
Cash and cash equivalents | $ 615 | $ 280 | |
Receivables, less allowances of $25 and $22, respectively | 206 | 178 | |
Inventories | 44 | 46 | |
Prepaid expenses and other assets | 145 | 81 | |
Current assets of discontinued operations | 45 | ||
Total Current Assets | 1,010 | 629 | |
Other Assets: | |||
Property and equipment, net | 182 | 204 | |
Operating lease right-of-use assets | 80 | 95 | |
Goodwill | 2,146 | 2,096 | |
Intangible assets, primarily trade names, service marks and trademarks, net | 1,111 | 1,169 | |
Restricted cash | 89 | 89 | |
Notes receivable | 31 | 32 | |
Long-term marketable securities | 14 | 13 | |
Deferred customer acquisition costs | 98 | 94 | |
Other assets | 75 | 68 | |
Long-term assets of discontinued operations | 834 | ||
Total Assets | 4,837 | 5,322 | |
Current Liabilities: | |||
Accounts payable | 91 | 96 | |
Accrued liabilities: | |||
Payroll and related expenses | 102 | 54 | |
Self-insured claims and related expenses | 76 | 72 | |
Accrued interest payable | 7 | 16 | |
Other | 99 | 82 | |
Deferred revenue | 102 | 107 | |
Current portion of lease liability | 17 | 19 | |
Current portion of long-term debt | [1] | 94 | 69 |
Current liabilities of discontinued operations | 42 | ||
Total Current Liabilities | 588 | 557 | |
Long-Term Debt | 826 | 1,666 | |
Other Long-Term Liabilities: | |||
Deferred taxes | 346 | 499 | |
Other long-term obligations, primarily self-insured claims | 239 | 158 | |
Long-term lease liability | 96 | 110 | |
Long-term liabilities of discontinued operations | 11 | ||
Total Other Long-Term Liabilities | 681 | 777 | |
Commitments and Contingencies (Note 9) | |||
Stockholders' Equity: | |||
Common stock $0.01 par value (authorized 2,000,000,000 shares with 148,400,384 shares issued and 132,080,845 shares outstanding at December 31, 2020 and 147,872,959 shares issued and 135,408,054 outstanding at December 31, 2019) | 2 | 2 | |
Additional paid-in capital | 2,359 | 2,334 | |
Retained Earnings | 841 | 291 | |
Accumulated other comprehensive income | (39) | 9 | |
Less common stock held in treasury, at cost (16,319,539 shares at December 31, 2020 and 12,464,905 shares at December 31, 2019) | (423) | (313) | |
Total Stockholders' Equity | 2,741 | 2,322 | |
Total Liabilities and Stockholders' Equity | $ 4,837 | $ 5,322 | |
[1] | The current portion of long-term debt consists of deferred purchase price and earnout payments on acquisitions, including approximately $ 50 million due to the former owners of Copesan in 2021, and scheduled principal payments of long-term debt due within 12 months. |
Consolidated Statements of Fi_2
Consolidated Statements of Financial Position (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Consolidated Statements of Financial Position [Abstract] | ||
Allowance for receivables (in dollars) | $ 25 | $ 22 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Common stock, shares issued (in shares) | 148,400,384 | 147,872,959 |
Common stock, shares outstanding (in shares) | 132,080,845 | 135,408,054 |
Treasury stock (in shares) | 16,319,539 | 12,464,905 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Millions | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings (Accumulated Deficit) [Member]Cumulative Effect, Period of Adoption, Adjustment [Member] | Retained Earnings (Accumulated Deficit) [Member] | Accumulated Other Comprehensive Income (Loss) [Member]Cumulative Effect, Period of Adoption, Adjustment [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Treasury Shares [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | Total |
Balance, shares at Dec. 31, 2017 | 147,000,000 | (12,000,000) | |||||||
Balance, value at Dec. 31, 2017 | $ 2 | $ 2,321 | $ (895) | $ 5 | $ (267) | $ 1,167 | |||
Net income (loss) | (41) | (41) | |||||||
Other comprehensive income (loss), net of tax | (3) | (3) | |||||||
Total Comprehensive Income (Loss) | (41) | (3) | (44) | ||||||
Net assets distributed to frontdoor, inc. | (35) | 1,078 | 1,043 | ||||||
Exercise of stock options | 6 | 6 | |||||||
Stock-based employee compensation | 16 | 16 | |||||||
Balance, shares at Dec. 31, 2018 | 147,000,000 | (12,000,000) | |||||||
Balance, value at Dec. 31, 2018 | $ 2 | 2,309 | $ 14 | 156 | $ 2 | 5 | $ (267) | $ 16 | 2,204 |
Net income (loss) | 128 | 128 | |||||||
Other comprehensive income (loss), net of tax | 4 | 4 | |||||||
Total Comprehensive Income (Loss) | 128 | 4 | 132 | ||||||
Net assets distributed to frontdoor, inc. | 4 | 4 | |||||||
Exercise of stock options | 10 | 10 | |||||||
Stock-based employee compensation | 15 | 15 | |||||||
Repurchase of common stock, shares | (1,000,000) | ||||||||
Repurchase of common stock | $ (47) | (47) | |||||||
Balance, shares at Dec. 31, 2019 | 148,000,000 | ||||||||
Balance, value at Dec. 31, 2019 | $ 2 | 2,334 | $ 3 | 291 | 9 | $ (313) | $ 3 | $ 2,322 | |
Treasury Stock, Shares at Dec. 31, 2019 | (12,000,000) | (12,464,905) | |||||||
Net income (loss) | 551 | $ 551 | |||||||
Other comprehensive income (loss), net of tax | (47) | (47) | |||||||
Total Comprehensive Income (Loss) | 551 | (47) | 504 | ||||||
Issuance of common stock | 2 | 2 | |||||||
Exercise of stock options | 6 | 6 | |||||||
Stock-based employee compensation | 18 | 18 | |||||||
Repurchase of common stock, shares | (4,000,000) | ||||||||
Repurchase of common stock | $ (110) | (110) | |||||||
Balance, shares at Dec. 31, 2020 | 148,000,000 | ||||||||
Balance, value at Dec. 31, 2020 | $ 2 | $ 2,359 | $ 841 | $ (39) | $ (423) | $ 2,741 | |||
Treasury Stock, Shares at Dec. 31, 2020 | (16,000,000) | (16,319,539) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash and Cash Equivalents and Restricted Cash at Beginning of Period | $ 368 | $ 313 | $ 563 |
Cash Flows from Operating Activities from Continuing Operations: | |||
Net Income (Loss) | 551 | 128 | (41) |
Adjustments to reconcile net income to net cash provided from operating activities: | |||
Net earnings from discontinued operations | (531) | (69) | (186) |
Equity in earnings of joint ventures | (3) | ||
Depreciation expense | 73 | 71 | 69 |
Amortization expense | 36 | 25 | 14 |
Amortization of debt issuance costs | 3 | 3 | 4 |
Amortization of lease right-of-use assets | 18 | 18 | |
Termite damage claims reserve adjustment | 53 | ||
Realized (gain) loss on investment in frontdoor, inc. | (40) | 249 | |
Loss on extinguishment of debt | 26 | 8 | 10 |
Deferred income tax provision | 8 | 9 | 8 |
Stock-based compensation expense | 16 | 14 | 13 |
Gain on sale of marketable securities | (2) | ||
Restructuring and other charges | 16 | 14 | 17 |
Payments for restructuring and other charges | (12) | (17) | (14) |
Acquisition-related costs | 16 | 4 | |
Payments for acquisition-related costs | (5) | (14) | (3) |
Other | (22) | (24) | (2) |
Change in working capital, net of acquisitions: | |||
Receivables | (30) | (4) | (3) |
Inventories and other current assets | (15) | (14) | (6) |
Accounts payable | 1 | (1) | (2) |
Deferred revenue | (4) | 4 | (2) |
Accrued liabilities | 50 | (8) | 10 |
Accrued interest payable | (7) | 2 | (1) |
Current income taxes | 26 | (7) | 17 |
Net Cash Provided from Operating Activities from Continuing Operations | 198 | 164 | 155 |
Cash Flows from Investing Activities from Continuing Operations: | |||
Property additions | (26) | (25) | (46) |
Government grant fundings for property additions | 7 | ||
Sale of equipment and other assets | 6 | 1 | 2 |
Business acquisitions, net of cash acquired | (36) | (506) | (187) |
Origination of notes receivable | (68) | (99) | (115) |
Collections on notes receivable | 76 | 110 | 92 |
Other investments | 1 | ||
Net Cash Used for Investing Activities from Continuing Operations | (47) | (519) | (248) |
Cash Flows from Financing Activities from Continuing Operations: | |||
Borrowings of debt | 1,470 | 1,000 | |
Payments of debt | (869) | (1,094) | (1,113) |
Discount paid on issuance of debt | (1) | ||
Debt issuance costs paid | (3) | (10) | |
Call premium paid on retirement of debt | (19) | ||
Contribution to frontdoor, Inc. | (242) | ||
Repurchase of common stock | (110) | (47) | |
Issuance of common stock | 8 | 10 | 7 |
Net Cash (Used For) Provided From Financing Activities from Continuing Operations | (992) | 328 | (349) |
Cash Flows from Discontinued Operations: | |||
Cash (used for) provided from operating activities | (363) | 79 | 220 |
Proceeds from sale of business | 1,541 | ||
Other investing activities | (1) | 3 | (3) |
Cash used for financing activities | (1) | (1) | (24) |
Net Cash Provided from Discontinued Operations | 1,176 | 81 | 193 |
Effect of Exchange Rate Changes on Cash | 1 | 1 | (1) |
Cash Increase (Decrease) During the Period | 336 | 55 | (250) |
Cash and Cash Equivalents and Restricted Cash at End of Period | 704 | 368 | 313 |
Mobile Bay Formosan [Member] | |||
Adjustments to reconcile net income to net cash provided from operating activities: | |||
Litigation settlement | 49 | ||
Payments on litigation related matters | $ (49) | ||
Fumigation Related Matters [Member] | |||
Adjustments to reconcile net income to net cash provided from operating activities: | |||
Litigation settlement | 3 | ||
Payments on litigation related matters | $ (2) | $ (2) |
Basis Of Presentation
Basis Of Presentation | 12 Months Ended |
Dec. 31, 2020 | |
Basis Of Presentation [Abstract] | |
Basis Of Presentation | Note 1. Basis of Presentation Terminix Global Holdings, Inc. (formerly known as ServiceMaster Global Holdings, Inc.) and its majority-owned subsidiary partnerships, limited liability companies and corporations (collectively, “Terminix,” the “Company,” “we,” “us” and “our”) is a leading provider of essential services to residential and commercial customers in the termite and pest management markets. Our portfolio of well-recognized brands includes Terminix, Assured Environments, Copesan, Gregory, McCloud, Nomor and Pelias. We have one reportable segment, our pest management and termite business. All consolidated subsidiaries are wholly-owned. Intercompany transactions and balances have been eliminated. Sale of ServiceMaster Brands On January 21, 2020, we announced we were exploring strategic alternatives related to ServiceMaster Brands, including the potential sale of the business. On October 1, 2020, we completed the sale of the ServiceMaster Brands Divestiture Group for $ 1,541 million to Roark, resulting in a gain of $ 494 million, net of income taxes. A portion of the proceeds was used to retire $ 750 million of our 5.125 % Notes due 2024 . The ServiceMaster Brands Divestiture Group is classified as discontinued operations for all periods presented. COVID-19 On March 11, 2020, the World Health Organization designated COVID-19 as a global pandemic, and governments around the world mandated orders to slow the transmission of the virus. States in the U.S., including Tennessee, where we are headquartered, declared states of emergency, and countries around the world, including the U.S. , took steps to restrict travel, instituted work from home policies, enacted temporary closures of businesses, issued quarantine orders and took other restrictive measures in response to the COVID-19 pandemic. These actions to attempt to control its spread impacted our business, primarily our commercial pest management service line, beginning in the first quarter. Within the U.S. , our business has been designated an essential business by the U.S. Department of Homeland Security, which has allowed us to continue to serve our customers. We implemented initiatives to ensure the safety and productivity of our workforce, including personal protective equipment and safety policies and measures for field personnel, and technology to facilitate remote working, with most back-office and all call center employees working remotely and field support personnel working remotely where possible. American Home Shield Spin-off On October 1, 2018, we completed the previously announced separation of our American Home Shield business (the “Separation”). The Separation was effectuated through a pro rata dividend (the “Distribution”) to our stockholders of approximately 80.2 % of the outstanding shares of common stock of Frontdoor, which was formed as a wholly owned subsidiary of the Company to hold its American Home Shield business. As a result of the Distribution, Frontdoor is an independent public company that trades on the Nasdaq Global Select Market under the symbol “FTDR.” The Distribution was made to our stockholders of record as of the close of business on September 14, 2018 (the “Record Date”), and such stockholders received one share of Frontdoor common stock for every two shares of Terminix common stock held as of the close of business on the Record Date. We distributed 67,781,527 shares of common stock of Frontdoor in the Distribution and retained 16,734,092 shares, or approximately 19.8 percent, of the common stock of Frontdoor immediately following the Distribution. These investments are accounted for as available for sale securities . In March 2019, we exchanged all of the 19.8 percent of the outstanding shares of common stock of Frontdoor we retained for certain of our outstanding indebtedness, which obligations were subsequently cancelled and discharged upon delivery to us. Included in the Consolidated Statements of Stockholders’ Equity for the year ended December 31, 2019, is an adjustment to the Net assets distributed to Frontdoor, Inc. to reflect the actual current and deferred taxes related to the Frontdoor distribution. See Note 5 for further discussion of the adjustment made in the year ended December 31, 2019 and Note 11 for further discussion regarding the debt-for-equity exchange transaction. The historical results of the American Home Shield business, including the results of operations, cash flows and related assets and liabilities are reported as discontinued operations for all periods presented herein. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Significant Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 2. Significant Accounting Policies Consolidation The consolidated financial statements include all of our wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of the consolidated financial statements requires management to make certain estimates and assumptions required under GAAP which may differ from actual results. The more significant areas requiring the use of management estimates relate to the allowance for uncollectible receivables; accruals for self-insured retention limits related to medical, workers’ compensation, auto and general liability insurance claims; accruals for Litigated Claims and Non-Litigated Claims; the possible outcome of outstanding litigation; accruals for income tax liabilities as well as deferred tax accounts; the deferral and amortization of customer acquisition costs; stock-based compensation; the valuation of acquisitions; useful lives for depreciation and amortization expense; the valuation of marketable securities; and the valuation of tangible and intangible assets. In 2019, we changed our methodology for estimating exposure for damage claims liabilities. See Note 9 to the consolidated financial statements for further discussion of this change. There were no changes in any other significant areas that require estimates or in the underlying methodologies used in determining the amounts of these associated estimates. The allowance for uncollectible receivables is developed based on several factors including overall customer credit quality, historical write-off experience and specific account analyses that project the ultimate collectability of the outstanding balances. As such, these factors may change over time causing the allowance level to vary. We carry insurance policies on insurable risks at levels which we believe to be appropriate, including workers’ compensation, auto and general liability risks. We purchase insurance policies from third-party insurance carriers, which typically incorporate significant deductibles or self-insured retentions. We are responsible for all claims that fall below the retention limits. In determining our accrual for self-insured claims, we use historical claims experience to establish both the current year accrual and the underlying provision for future losses. This actuarially determined provision and related accrual include known claims, as well as incurred but not reported claims. We adjust the estimate of accrued self-insured claims when required to reflect changes based on factors such as changes in health care costs, accident frequency and claim severity. We seek to reduce the potential amount of loss arising from self-insured claims by insuring certain levels of risk. While insurance agreements are designed to limit our losses from large exposure and permit recovery of a portion of direct unpaid losses, insurance does not relieve us of ultimate liability. Accordingly, the accruals for insured claims represent our total unpaid gross losses. Insurance recoverables, which are reported within Prepaid expenses and other assets and Other assets, relate to estimated insurance recoveries on the insured claims reserves. Termite damage claim accruals are recorded based on both the historical rates of claims incurred within a contract term and the cost per claim. Current activity could differ causing a change in estimates. We have certain liabilities with respect to existing or potential claims, lawsuits, and other proceedings. We accrue for these liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated. Any resulting adjustments, which could be material, are recorded in the period the adjustments are identified. We record deferred income tax balances based on the net tax effects of temporary differences between the carrying value of assets and liabilities for financial reporting purposes and income tax purposes. We record deferred tax items based on the estimated value of the tax basis. We adjust tax estimates when required to reflect changes based on factors such as changes in tax laws, relevant court decisions, results of tax authority reviews and statutes of limitations. We record a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. We recognize potential interest and penalties related to our uncertain tax positions in Provision (benefit) for income taxes on the Consolidated Statements of Operations and Comprehensive Income (Loss). Revenue Residential pest management services Residential pest management services can be for one-time or recurring services. Revenues from residential pest management services are recognized at the agreed-upon contractual amount over time as the services are provided, most of which are started and completed within one day, as the customer simultaneously receives and consumes the benefits of the services as they are performed. Upon completion of service, a receivable is recorded related to this revenue as we have an unconditional right to invoice and receive payment. Payments are typically received shortly after services have been rendered. Commercial pest management services Commercial pest management services are largely for recurring services. Revenues from commercial pest management services are recognized at the agreed-upon contractual amount over time as the services are provided, most of which are started and completed within one day, as the customer simultaneously receives and consumes the benefits of the services as they are performed. Upon completion of service, a receivable is recorded related to this revenue as we have an unconditional right to invoice and receive payment. Payments are typically received shortly after services have been rendered. Termite and home services We eradicate termites through the use of baiting systems and non-baiting methods (e.g., fumigation or liquid treatments). Termite services using liquid and baiting systems are sold through renewable contracts. We also perform other related services, including wildlife exclusion, crawl space encapsulation and attic insulation, which may be one-time or renewable services. Revenues for termite services are recognized at the agreed-upon contractual amount upon the completion of the service. All termite services are generally started and completed within one day. Upon completion of the service, a receivable is recorded related to this revenue as we have an unconditional right to invoice and receive payment. Payments are typically received shortly after services have been rendered. Most termite services can be renewed after the initial year. Revenue on renewal contracts is recognized upon completion of an annual inspection and receipt of payment from the customer which evidences the extension of the contract into a renewal period. Advanced renewal payments generate a contract liability and are deferred until the related renewal period. Termite inspection and protection contracts are frequently sold through annual contracts. For these contracts, we have a stand ready obligation of which the customer receives and consumes the benefits over the annual period. Associated service costs are expensed as incurred. We measure progress toward satisfaction of our stand ready obligation over time using costs incurred as the measure of progress under the input method, which results in straight-line recognition of revenue. Payments are received at the commencement of the contract, which can generate a contract liability, or in installments over the contract period. Sales of products and other Product revenues are generated from selling products to distributors and franchisees. Revenues from product sales are generally recognized once control of the products transfers to the customer. A receivable is recorded related to these sales as we have an unconditional right to invoice and receive payment. Payments are typically received shortly after a customer is invoiced. Costs to obtain a contract with a customer We capitalize the incremental costs of obtaining a contract with a customer, primarily commissions, and recognize the expense on a straight-line basis over the expected customer relationship period. As of December 31, 2020 and 2019, we had long-term deferred customer acquisition costs of $ 98 million and $ 94 million, respectively. In the years ended December 31, 2020 and 2019, the amount of amortization was $ 97 million and $ 84 million, respectively. There were no impairment losses in relation to costs capitalized. Contract balances Timing of revenue recognition may differ from the timing of invoicing customers. Contracts with customers are generally for a period of one year or less and are generally renewable. We record a receivable related to revenue recognized on services once we have an unconditional right to invoice and receive payment in the future related to the services provided. All accounts receivables are recorded within Receivables, less allowances, on the Consolidated Statements of Financial Position. The current portion of Notes receivable, which represent amounts financed for customers through our financing subsidiary, are included within Receivables, less allowances, on the Consolidated Statements of Financial Position and totaled $ 27 million and $ 38 million as of December 31, 2020 and 2019, respectively. Advertising Advertising costs are expensed when the advertising occurs. Advertising expense for the years ended December 31, 2020, 2019 and 2018 was $ 91 million, $ 90 million and $ 82 million, respectively. Inventory Inventories are recorded at the lower of cost (primarily on a weighted-average cost basis) or net realizable value. Our inventory primarily consists of finished goods to be used on the customers’ premises or sold to franchisees. Property and Equipment, Intangible Assets and Goodwill Property and equipment consist of the following: Estimated As of December 31, Useful Lives (In millions) 2020 2019 (Years) Land $ 5 $ 5 N/A Buildings and improvements 51 53 10 ‒ 40 Technology and communications 172 175 3 ‒ 7 Machinery, production equipment and vehicles 287 271 3 ‒ 9 Office equipment, furniture and fixtures 23 28 5 ‒ 7 538 532 Less accumulated depreciation ( 356 ) ( 328 ) Net property and equipment $ 182 $ 204 Depreciation of property and equipment, including depreciation of assets held under finance leases was $ 73 million, $ 71 million and $ 69 million for the years ended December 31, 2020, 2019 and 2018, respectively. No impairment charges were recorded in the years ended December 31, 2020, 2019 or 2018. Fixed assets and intangible assets with finite lives are depreciated and amortized on a straight-line basis over their estimated useful lives. These lives are based on our previous experience for similar assets, potential market obsolescence and other industry and business data. As required by accounting standards for the impairment or disposal of long-lived assets, fixed assets and finite-lived intangible assets are tested for recoverability whenever events or changes in circumstances indicate their carrying amounts may not be recoverable. If the carrying value is no longer recoverable based upon the undiscounted future cash flows of the asset, an impairment loss would be recognized equal to the difference between the carrying amount and the fair value of the asset. Changes in the estimated useful lives or in the asset values could cause us to adjust its book value or future expense accordingly. As required under accounting standards for goodwill and other intangibles, goodwill is not subject to amortization, and intangible assets with indefinite useful lives are not amortized until their useful lives are determined to no longer be indefinite. Goodwill and intangible assets that are not subject to amortization are subject to assessment for impairment by applying a fair-value based or qualitative test on an annual basis or more frequently if circumstances indicate a potential impairment. Our goodwill resides in multiple reporting units and primarily consists of expected synergies in addition to the expansion of our geographic presence. Goodwill and indefinite-lived intangible assets, primarily trade names, are assessed annually for impairment on the first day of the fourth quarter or earlier upon the occurrence of certain events or substantive changes in circumstances. Our 2020, 2019 and 2018 annual impairment analyses, which were performed as of October 1 of each year, did no t result in any goodwill or trade name impairments. See Note 4 to the consolidated financial statements for our goodwill and intangible assets balances. Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, “ Leases (Topic 842) ” (codified within FASB Accounting Standards Codification (“ASC”) 842) which is the final standard on accounting for leases. We adopted the new lease guidance effective January 1, 2019, and elected certain of the available practical expedients upon adoption. See Note 12 for further discussion of our lease assets and liabilities. We determine if an arrangement is a lease at inception. Operating leases are included in Operating lease right-of-use assets, Current portion of lease liability and Long-term lease liability on the Consolidated Statements of Financial Position. Finance leases are included in Property and equipment, net; Current portion of long-term debt and Long-term debt on the Consolidated Statements of Financial Position. We lease a variety of facilities, principally in the U.S. , for branch and service center operations and for office, storage and data processing space. Most of the property leases provide that we pay taxes, insurance and maintenance applicable to the leased premises. These leases are classified as operating leases. Our facilities leases have remaining lease terms of less than one year to 22 years, some of which may include options to extend the leases for up to 15 years, and some of which may include options to terminate the leases within one year . These lease agreements contain lease and non-lease components. Non-lease components include items such as common area maintenance. For facility leases, we account for the lease and non-lease components as a single lease component. Additionally, our Fleet Agreement allows us to obtain fleet vehicles through a leasing program. These leases are classified as finance leases. Our vehicle leases have remaining lease terms of less than one year to seven years . For vehicle leases, we account for the lease and non-lease components separately. Operating lease right-of-use (“ROU”) assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments, including fixed non-lease components, over the lease term at commencement date. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Generally, the lease term is the minimum noncancelable period of the lease, or the lease term inclusive of reasonably certain renewal periods. Lease expense for minimum lease payments and fixed non-lease components is recognized on a straight-line basis over the lease term. As the rates implicit in our leases are not readily determinable, we use a collateralized incremental borrowing rate based on the information available at the lease commencement date in determining the present value of future payments. We use the portfolio approach and group leases into categories by lease term length, applying the corresponding incremental borrowing rates to these categories of leases. Restricted Cash Restricted cash consists of cash held in trust as collateral under our automobile, general liability and workers’ compensation insurance program. Financial Instruments and Credit Risk We use derivative financial instruments to manage risks associated with changes in fuel prices and interest rates. We have entered into specific financial arrangements in the normal course of business to manage certain market risks, with a policy of matching positions and limiting the terms of contracts to relatively short durations. The effect of derivative financial instrument transactions could have a material impact on our financial statements. We do not hold or issue derivative financial instruments for trading or speculative purposes. In designating derivative financial instruments as hedging instruments under accounting standards, we formally document the relationship between the hedging instrument and the hedged item, as well as the risk management objective and strategy for the use of the hedging instrument. This documentation includes linking the derivatives to forecasted transactions. We assess at the time a derivative contract is entered into, and at least quarterly thereafter, whether the derivative item is effective in offsetting the projected changes in cash flows of the associated forecasted transactions. We have historically hedged a significant portion of our annual fuel consumption. We have also historically hedged the interest payments on a portion of our variable rate debt through the use of interest rate swap agreements. These derivatives are classified as cash flow hedges, and, as such, the hedging instruments are recorded on the Consolidated Statements of Financial Position as either an asset or liability at fair value, with the effective portion of changes in the fair value attributable to the hedged risks recorded in accumulated other comprehensive income. Cash flows related to our derivatives are classified as operating activities in the Consolidated Statements of Cash Flows. In March 2020, we entered into a cross-currency swap agreement to hedge our investment in Nomor against future volatility in the exchange rates between the Swedish krona and the U.S. dollar. We designated this cross-currency swap as a qualifying hedging instrument and account for it as a net investment hedge. Under this method, for each reporting period, the change in fair value of the cross-currency swap is initially recognized in Accumulated other comprehensive income. We also entered into a cross-currency swap to manage the related foreign currency exposure from an intercompany loan denominated in Swedish krona. We designated this cross-currency swap as a qualifying hedging instrument and account for it as a cash flow hedge. Gains and losses from the change in fair value of the cross currency swap are initially recognized in Accumulated other comprehensive income and reclassified to earnings to offset the foreign exchange impact created by the intercompany loan. Financial instruments, which potentially subject us to financial and credit risk, consist principally of receivables. Most of our receivables and notes receivable have little concentration of credit risk due to the large number of customers with relatively small balances and their dispersion across geographical areas. We maintain an allowance for losses based upon the expected collectability of receivables, adjusted for the impact of economic factors, such as unemployment, are expected to have on the collectability of receivables, if necessary. We also hold long-term marketable securities as part of our deferred compensation plan, which are accounted for at fair value with adjustments recognized in Interest and net investment income in the Consolidated Statements of Operations and Comprehensive Income (Loss) in the period incurred. See Note 17 to the consolidated financial statements for information relating to the fair value of financial instruments. Stock-Based Compensation Stock-based compensation expense for stock options is estimated at the grant date based on an award’s fair value as calculated by the Black-Scholes option-pricing model and is recognized as expense over the requisite service period. The Black-Scholes model requires various highly judgmental assumptions including expected volatility and option life. If any of the assumptions used in the Black-Scholes model change significantly, stock-based compensation expense for future grants may differ materially from that recorded in the current period related to options granted to date. In addition, we estimate the expected forfeiture rate and only recognize expense for those shares expected to vest. We estimate the forfeiture rate based on historical experience. To the extent the actual forfeiture rate is different from the estimate, stock-based compensation expense is adjusted accordingly. See Note 16 to the consolidated financial statements for more details. Income Taxes We and our subsidiaries file consolidated U.S. federal income tax returns. State and local returns are filed both on a separate company basis and on a combined unitary basis with the Company. Current and deferred income taxes are provided for on a separate company basis. We account for income taxes using an asset and liability approach for the expected future tax consequences of events that have been recognized in our financial statements or tax returns. Deferred income taxes are provided to reflect the differences between the tax bases of assets and liabilities and their reported amounts in the financial statements. Valuation allowances are established when necessary to reduce deferred income tax assets to the amounts expected to be realized. We record a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in our tax return. We recognize potential interest income, interest expense and penalties related to uncertain tax positions in income tax expense. Earnings Per Share Basic earnings per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding. Diluted earnings per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, increased to include the number of shares of common stock that would have been outstanding had potential dilutive shares of common stock been issued. The dilutive effect of stock options, restricted stock units (“RSUs”) and performance shares are reflected in diluted earnings per share by applying the treasury stock method. See Note 18 to the consolidated financial statements for more details. Acquisitions Acquisitions have been accounted for as business combinations using the acquisition method in accordance with ASC 805, “Business Combinations,” and, accordingly, the purchase price has been allocated to the acquired assets and liabilities assumed at their estimated fair values as of the acquisition dates. The fair value of customer relationships is identified using an income approach. The fair value of trade names acquired is identified using the relief from royalty method. Determining the fair value of intangible assets required the use of significant judgment, including the discount rates and the long-term plans about future revenues and expenses, capital expenditures and changes in working capital, which are dependent on information provided by the company acquired. After the purchase price is allocated, goodwill is recorded to the extent the total consideration paid for the acquisition exceeds the sum of the fair value of all assets and liabilities acquired. Asset acquisitions have been accounted for under ASU 2017-01, “Business Combinations (Topic 805) – Clarifying the Definition of a Business.” Determining the useful life of an intangible asset also requires judgment as different intangible assets will have different useful lives. The results of operations of the acquired businesses have been included in the consolidated financial statements since their dates of acquisition. Reportable Segment We have one reportable segment, our pest management and termite business. Our reportable segment is comprised of multiple operating segments, including Terminix and individual international subsidiaries. Each operating segment’s results are regularly reviewed by the chief executive officer, the chief operating decision maker. All operating segments have been aggregated into one reportable segment based on their similar economic characteristics, nature of services provided, type of customers and service distribution methods. Newly Issued Accounting Standards Adoption of New Accounting Standards In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, “ Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments .” This ASU requires entities to report “expected” credit losses on financial instruments and other commitments to extend credit rather than the current “incurred loss” model. These expected credit losses for financial assets held at the reporting date are to be based on historical experience, current conditions and reasonable and supportable forecasts. This ASU also requires enhanced disclosures relating to significant estimates and judgments used in estimating credit losses, as well as the credit quality. We adopted this ASU on January 1, 2020, and this adoption did not have a material impact on our financial condition or the results of our operations. In August 2017, the FASB issued ASU 2017-12, “ Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities .” The ASU simplifies certain aspects of hedge accounting and improves disclosures of hedging arrangements through the elimination of the requirement to separately measure and report hedge ineffectiveness. The ASU generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item in order to align financial reporting of hedging relationships with economic results. Entities must apply the amendments to cash flow and net investment hedge relationships that exist on the date of adoption using a modified retrospective approach. The presentation and disclosure requirements must be applied prospectively. We adopted this ASU on January 1, 2019, and it did not have a significant impact on our financial condition or the results of our operations. In July 2018, the FASB issued ASU 2018-09, “ Codification Improvements. ” This ASU does not prescribe any new accounting guidance, but instead makes minor improvements and clarifications of several different FASB Accounting Standards Codification areas based on comments and suggestions made by various stakeholders. Certain updates are applicable immediately while others provide for a transition period to adopt as part of the next fiscal year beginning after December 15, 2018. We adopted this ASU on January 1, 2019, and it did not have a significant impact on our financial condition or the results of our operations. In August 2018, the FASB issued ASU 2018-15, “ Intangibles—Goodwill and Other—Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract .” This ASU requires implementation costs incurred by customers in cloud computing arrangements (i.e., hosting arrangements) to be capitalized under the same premises of authoritative guidance for internal-use software, and deferred over the noncancelable term of the cloud computing arrangements plus any optional renewal periods that are reasonably certain to be exercised by the customer or for which the exercise is controlled by the service provider. The amendments in ASU 2018-15 are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. We early adopted this ASU on January 1, 2019, resulting in the capitalization of certain development costs of approximately $ 13 million and $ 14 million in December 31, 2020 and 2019, respectively, primarily related to our implementation of a new customer experience platform to replace legacy operating systems. In August 2018, the FASB issued ASU 2018-13, “ Fair Value Measurement .” Under ASU 2018-13, entities are required to disclose the amount of total gains or losses for the period recognized in other comprehensive income that is attributable to fair value changes in assets and liabilities held as of the balance sheet date and categorized within Level 3 of the fair value hierarchy. Additionally, the ASU requires the disclosure of the range and weighted average used to develop significant unobservable inputs and how the weighted average was calculated for fair value measurements categorized within Level 3 of the fair value hierarchy. We adopted this ASU on January 1, 2020, and this adoption had no impact to our disclosures. See Note 17 for further discussion of our Level 3 investments. In October 2019, the FASB issued ASU No. 2018-16, “ Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes ,” which amends ASC 815, Derivatives and Hedging. This ASU adds the OIS rate based on SOFR to the list of permissible benchmark rates for hedge accounting purposes. We adopted the ASU on January 1, 2019, and it did not have a significant impact on our financial condition or the results of our operations. In March 2020, the FASB issued ASU 2020-03, “ Codification Improvements .” This ASU does not prescribe any new accounting guidance, but instead makes minor improvements and clarifications of several different FASB Accounting Standards Codification areas based on comments and suggestions made by various stakeholders. Certain updates are applicable immediately while others provide for a transition period to adopt as part of the next fiscal year beginning after December 15, 2020. We adopted the updates, as applicable, in 2020, and this adoption did not have a material impact on our financial condition or the results of our operations. In March 2020, the FASB issued ASU 2020-04, “ Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting .” The ASU provides optional guidance to ease the potential burden in accounting for reference rate reform on financial reporting in response to the risk of cessation of the London Interbank Offered Rate (LIBOR). This amendment provides for optional expedients and exceptions for applying generally accepted accounting principles to contracts and hedging relationships that are affected by LIBOR and other reference rates. The ASU generally allows for a hedge accounting to continue if the hedge was highly effective or met other standards prior to reference rate reform. Entities are permitted to apply the amendments to all contracts, cash flow and net investment hedge relationships that exist as of March 12, 2020. The relief provided in this ASU is only available for a limited time, generally through December 31, 2022. Our debt agreement and interest rate swap that utilize LIBOR have not yet discontinued the use of LIBOR and, therefore, this ASU is not yet effective for us. To the extent our debt and interest rate swap arrangements change to another accepted rate, we will utilize the relief in this ASU to continue hedge accounting as we expect the remaining critical terms of our hedging relationship will still match. In November 2020, the SEC issued Rule 33-10890, “ Management’s Discussion and Analysis, Selected Financial Data, and Supplementary Financial Information .” This rule is effective for our Annual Report on Form 10-K for the year ended December 31, 2021, and can be early adopted in its entirety as of February 10, 2021. The rule modernized, simplified and enhanced financial statement disclosures required by Regulation S-K. We early adopted all the provisions in the rule as of February 10, 2021 in this Annual Report on Form 10-K, which primarily resulted in the removal of the contractual obligations table, elimination of duplicative disclosures of legal matters and the simplification of our risk factors. While permitted, we did not remove or simplify the Selected financial data, Quarterly operating results or certain discussions within Management’s Discussion and Analysis as we had not previously presented the ServiceMaster Brands Divestiture Group as discontinued operations or our results as one reportable segment for all relevant periods. Our adoptions of ASU 2016-01, “ Recognition and Mea |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2020 | |
Revenues[Abstract] | |
Revenues | Note 3. Revenues The following tables present our revenues, disaggregated by revenue source and geographic area. We disaggregate revenue from contracts with customers into major product lines. We have determined that disaggregating revenue into these categories achieves the disclosure objective to depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. On April 1, 2019, we divested the assets associated with our fumigation service line and now provide fumigation services to our customers through arrangements with independent third parties. Revenue related to the Fumigation Services, previously presented separately, is now included in Termite and Home Services. Additionally, prior period revenue for Residential Pest Management and Commercial Pest Management has been reclassified to conform to the current period presentation. Revenue by major service line is as follows: Year ended December 31, (In millions) 2020 2019 2018 Major service line Residential Pest Management $ 706 $ 683 $ 633 Commercial Pest Management 443 420 339 Termite and Home Services 633 607 599 Sales of Products and Other 100 88 84 European Pest Management 79 21 — Total $ 1,961 $ 1,819 $ 1,655 Revenue by geographic area is as follows: Year ended December 31, (In millions) 2020 2019 2018 United States $ 1,851 $ 1,767 $ 1,624 International 111 52 31 Total $ 1,961 $ 1,819 $ 1,655 At contract inception, we assess the goods and services promised in our contracts with customers and identify a performance obligation for each promise to transfer to the customer a good or service (or a bundle of goods and services) that is distinct. To identify the performance obligation, we consider all of the goods and services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. Deferred revenue represents a contract liability and is recognized when cash payments are received in advance of the performance of services, including when the amounts are refundable. Amounts are recognized as revenue upon completion of services. Changes in deferred revenue for the years ended December 31, 2020 and 2019 were as follows (in millions): (In millions) Deferred revenue Balance as of December 31, 2018 $ 91 Deferral of revenue (1) 146 Recognition of deferred revenue ( 129 ) Balance as of December 31, 2019 $ 107 Deferral of revenue 129 Recognition of deferred revenue ( 134 ) Balance as of December 31, 2020 $ 102 ___________________________________ (1) Includes approximately $ 15 million of deferred revenue related to our acquisition of Nomor. There was approximately $ 70 million recognized in the year ended December 31, 2020 that was included in the deferred revenue balance as of December 31, 2019. There was approximately $ 58 million of revenue recognized in the year ended December 31, 2019, that was included in the deferred revenue balance as of December 31, 2018. Arrangements with Multiple Performance Obligations Our contracts with customers may include multiple performance obligations. For such arrangements, we allocate revenue to each performance obligation based on its relative standalone selling price. Any discounts given are allocated to the services to which the discounts relate. Practical Expedients and Exemptions We offer certain interest-free contracts to customers where payments are received over a period not exceeding one year. Additionally, certain Terminix customers may pay in advance for services. We do not adjust the promised amount of consideration for the effects of these financing components. At contract inception, the period of time between the performance of services and the customer payment is one year or less. Revenue is recognized net of any taxes collected from customers which are subsequently remitted to taxing authorities. We do not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. Certain non-commission related incremental costs to obtain a contract with a customer are expensed as incurred because the amortization period would have been one year or less. These costs are included in Selling and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss). We utilize the portfolio approach to recognize revenue in situations where a portfolio of contracts has similar characteristics. The revenue recognized under the portfolio approach is not materially different than if every individual contract in the portfolio was accounted for separately. Impact of ASC 606 on the Consolidated Financial Statements We adopted ASC 606 on January 1, 2018, and recorded a net reduction to accumulated deficit of $ 16 million due to the cumulative impact of the adoption. Changes to the Consolidated Statements of Operations and Comprehensive Income (Loss) included: (i) costs of obtaining a contract that would have been incurred regardless of whether the contract was obtained, such as direct mail and digital advertising, are now expensed as incurred; and (ii) commissions costs incremental to a successful sale are deferred and recognized over the expected customer relationship period. The following table compares the Consolidated Statement of Operations and Comprehensive Income (Loss) as prepared under the provisions of ASC 606 to a presentation of these financial statements under the prior revenue recognition guidance : Year ended December 31, 2018 (In millions) As reported Under Prior Revenue Recognition Guidance Revenue $ 1,655 $ 1,655 Cost of services rendered and products sold 944 944 Selling and administrative expenses 500 507 Provision for income taxes 14 12 Net (Loss) $ ( 41 ) $ ( 46 ) During the year ended December 31, 2019, we corrected our calculation of deferred tax assets related to the adoption of ASC 606. As a result, approximately $ 3 million was recognized in Retained earnings in the Consolidated Statements of Financial Position. The adoption of ASC 606 had no significant impact on our cash flows. The aforementioned impacts resulted in offsetting shifts in cash flows from operations between net income (loss) and various change in working capital line items. |
Goodwill And Intangible Assets
Goodwill And Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill And Intangible Assets [Abstract] | |
Goodwill And Intangible Assets | Note 4. Goodwill and Intangible Assets The table below summarizes the goodwill balances: (In millions) Balance as of December 31, 2018 $ 1,781 Acquisitions 309 Purchase accounting adjustments ( 2 ) Impact of foreign exchange rates 7 Balance as of December 31, 2019 $ 2,096 Acquisitions 9 Purchase accounting adjustments 29 Impact of foreign exchange rates 12 Balance as of December 31, 2020 $ 2,146 The table below summarizes the other intangible asset balances: Weighted Average As of December 31, 2020 As of December 31, 2019 Remaining Accumulated Accumulated Useful Lives (In millions) (Years) Gross Amortization Net Gross Amortization Net Trade names, indefinite ꟷ $ 888 $ — $ 888 $ 888 $ — $ 888 Customer relationships (1) 19 650 ( 454 ) 196 659 ( 423 ) 236 Trade names, finite, and Other (2) 5 70 ( 43 ) 27 79 ( 34 ) 45 Total $ 1,608 $ ( 497 ) $ 1,111 $ 1,626 $ ( 457 ) $ 1,169 ___________________________________ (1) Includes purchase accounting adjustments subsequent to December 31, 2019, including $ 17 million related to our acquisition of Nomor and $ 7 million related to other acquisitions, offset by foreign currency fluctuations. (2) Includes purchase accounting adjustments subsequent to December 31, 2019, primarily related to our acquisition of Nomor, of $ 9 million. Amortization expense of $ 36 million , $ 25 million and $ 14 million was recorded in the years ended December 31, 2020, 2019 and 2018, respectively. For the existing intangible assets, we anticipate amortization expense of $ 36 million, $ 34 million, $ 31 million, $ 23 million and $ 18 million in 2021, 2022, 2023, 2024 and 2025, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Taxes [Abstract] | |
Income Taxes | Note 5. Income Taxes The components of income from continuing operations before income taxes are as follows: Year Ended December 31, (In millions) 2020 2019 2018 U.S. $ 46 $ 76 $ ( 212 ) Foreign ( 5 ) ( 12 ) ( 2 ) Income from Continuing Operations before Income Taxes $ 41 $ 64 $ ( 214 ) The reconciliation of income tax computed at the U.S. federal statutory tax rate to our effective income tax rate for continuing operations is as follows: Year Ended December 31, 2020 2019 2018 Tax at U.S. federal statutory rate 21.0 % 21.0 % 21.0 % State and local income taxes, net of U.S. federal benefit (1) 15.1 2.6 ( 1.6 ) Foreign rate differences 2.1 0.6 ( 0.4 ) Tax credits ( 5.2 ) ( 3.5 ) 1.5 Realized (gain) loss on investment in frontdoor, inc. — ( 13.3 ) ( 24.5 ) Limitation on executive compensation 2.7 1.2 ( 0.4 ) Excess tax benefits from stock-based compensation 0.3 ( 1.8 ) 0.6 Mobile Bay Formosan termite settlement 20.3 — — Tax reserves ( 2.7 ) 0.3 ( 0.5 ) Other items 4.5 0.2 ( 0.4 ) U.S. Tax Reform rate change (2) — — ( 1.6 ) Effective rate 58.1 % 7.3 % ( 6.3 ) % ___________________________________ (1) The increase in State and local income taxes, net of U.S. federal benefit, was driven by the Mobile Bay Formosan termite settlement. (2) Deferred income taxes in the Consolidated Statements of Financial Position at December 31, 2018 were remeasured as a result of U.S. Tax Reform. The effective tax rate for discontinued operations for the years ended December 31, 2020, 2019 and 2018 was 26.6 percent, 24.1 percent and 26.1 percent, respectively. Income tax expense from continuing operations is as follows: Year Ended December 31, (In millions ) 2020 2019 2018 Current: U.S. federal $ 6 $ ( 1 ) $ 16 Foreign 2 — — State and local 8 1 6 16 1 22 Deferred: U.S. federal 8 4 ( 10 ) Foreign ( 2 ) ( 1 ) 1 State and local 2 1 1 8 4 ( 8 ) Provision for income taxes $ 24 $ 5 $ 14 Deferred income tax expense results from timing differences in the recognition of income and expense for income tax and financial reporting purposes. Deferred income tax balances reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting and income tax purposes. The deferred tax asset primarily reflects the impact of future tax deductions related to our accruals and certain net operating loss carryforwards. The deferred tax liability is primarily attributable to the basis differences related to intangible assets. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. The valuation allowance for deferred tax assets as of December 31, 2020 and 2019 was $ 8 million and $ 12 million, respectively. Significant components of our deferred tax balances are as follows: As of December 31, (In millions) 2020 2019 Deferred tax (liabilities) assets: Intangible assets (1) $ ( 353 ) $ ( 498 ) Property and equipment ( 32 ) ( 29 ) Operating lease right-of-use assets ( 26 ) ( 30 ) Prepaid expenses and deferred customer acquisition costs ( 25 ) ( 25 ) Receivables allowances 6 6 Self-insured claims and related expenses 2 2 Accrued liabilities 36 35 Other long-term obligations 13 4 Current portion of lease liability and long-term lease liability 28 32 Net operating loss and tax credit carryforwards 13 16 Less valuation allowance ( 8 ) ( 12 ) Net Deferred taxes $ ( 346 ) $ ( 499 ) ___________________________________ (1) The deferred tax liability relates primarily to the difference in the tax versus book basis of intangible assets. As of December 31, 2020 and December 31, 2019, we had $ 335 million and $ 505 million, respectively, of deferred tax liability included in this net deferred tax liability, that would only be paid in certain circumstances, including liquidation or sale of various subsidiaries of the Company. As of December 31, 2020, we had deferred tax assets, net of valuation allowances, of $ 4 million for federal and state net operating loss and capital loss carryforwards, which expire at various dates up to 2040. We also had deferred tax assets, net of valuation allowances, of less than $ 1 million for federal and state credit carryforwards which expire at various dates up to 2026. The federal and state net operating loss carryforwards in the filed income tax returns included unrecognized tax benefits taken in prior years. The net operating losses for which a deferred tax asset is recognized for financial statement purposes in accordance with ASC 740 are presented net of these unrecognized tax benefits. Included in the Consolidated Statements of Stockholders’ Equity for the year ended December 31, 2019, is an adjustment to the Net assets distributed to frontdoor, inc. Our 2018 income tax provision included an estimate of the income taxes based on assumptions and available information at the time the 2018 financial statements were prepared. We adjusted our 2018 tax provision based on our income tax returns filed in the fourth quarter of 2019 to reflect the actual current and deferred taxes related to the Frontdoor distribution. The result was a decrease to our current taxes payable and a corresponding increase to Retained earnings. As of December 31, 2020, 2019 and 2018, we have $ 14 million, $ 14 million and $ 15 million, respectively, of tax benefits primarily reflected in U.S. federal and state tax returns that have not been recognized for financial reporting purposes (“unrecognized tax benefits”). At December 31, 2020 and 2019, $ 13 million and $ 13 million, respectively, of unrecognized tax benefits would impact the effective tax rate if recognized. A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows: Year Ended December 31, (In millions) 2020 2019 2018 Gross unrecognized tax benefits at beginning of period $ 14 $ 15 $ 14 Decrease in tax positions for prior years ( 2 ) — — Increases in tax positions for current year 4 1 3 Settlements — ( 1 ) — Lapse in statute of limitations ( 2 ) ( 1 ) ( 1 ) Gross unrecognized tax benefits at end of period $ 14 $ 14 $ 15 Based on information currently available, it is reasonably possible that over the next 12-month period unrecognized tax benefits may decrease by $ 2 million as the result of settlements of ongoing audits, statute of limitation expirations or final settlements of uncertain tax positions in multiple jurisdictions. We file consolidated and separate income tax returns in the U.S. federal jurisdiction and in many state and foreign jurisdictions. In the ordinary course of business, we are subject to review by domestic and foreign taxing authorities. For U.S. federal income tax purposes, we participate in the IRS’s Compliance Assurance Process whereby our U.S. federal income tax returns are reviewed by the IRS both prior to and after their filing. The U.S. federal income tax returns filed through the year ended December 31, 2018 have been audited by the IRS. The IRS commenced pre-filing examinations of our U.S. federal income tax returns for 2020 in the second quarter of 2020. Four state tax authorities are in the process of auditing state income tax returns of various subsidiaries. We are no longer subject to state and local or foreign income tax examinations by tax authorities for years before 2013, except for a pending refund claim related to 2008. Our policy is to recognize potential interest and penalties related to tax positions within the tax provision. Total interest and penalties included in the consolidated statements of income are immaterial. As of both December 31, 2020 and 2019, we had accrued for the payment of interest and penalties of approximately $ 2 million. We consider the earnings in our non-U.S. subsidiaries to be indefinitely reinvested and, accordingly, recorded no deferred income taxes. While undistributed foreign earnings are no longer taxable under U.S. tax principles, actual repatriation from our non-U.S. subsidiaries could still be subject to additional foreign withholding taxes and U.S. state taxes. Cash associated with indefinitely reinvested foreign earnings was approximately $ 41 million and $ 35 million as of December 31, 2020 and 2019, respectively. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2020 | |
Acquisitions [Abstract] | |
Acquisitions | Note 6. Acquisitions 2020 During the year ended December 31, 2020, we completed 12 tuck-in acquisitions. The total purchase price for these acquisitions and final funding for eight minority investments was $ 36 million. We recorded goodwill of $ 9 million and other intangibles, primarily customer relationships, of $ 9 million. The purchase price allocations for these acquisitions will be finalized no later than one year from the respective acquisition dates. For incomplete purchase price allocations, we are evaluating working capital balances, the intangible and tangible assets acquired, and the appropriate useful lives to assign to all assets, including intangibles. 2019 During the year ended December 31, 2019, we completed 39 acquisitions (the “2019 Acquisitions”) for an aggregate purchase price of $ 497 million, net of $ 12 million of cash acquired, using available cash on hand and borrowings under our then existing revolving credit facility. Business acquisitions, net of cash acquired, on the Consolidated Statements of Cash Flows also includes approximately $ 9 million for minority investments made in eight pest control companies. Nomor On September 6, 2019, we acquired Nomor, a leading provider of pest management services in Sweden and Norway, for approximately 2 billion Swedish krona (approximately $ 198 million using the September 6, 2019 exchange rate, net of approximately $ 9 million of cash acquired). This strategic acquisition launched our expansion into the European pest management market. We funded the acquisition using cash on hand and proceeds from a $ 120 million borrowing under our then-existing revolving credit facility. We recognized approximately $ 4 million of Acquisition-related costs on the Consolidated Statements of Operations and Comprehensive Income related to our acquisition of Nomor in the year ended December 31, 2019. The allocation of the purchase price was as follows: (In millions) Current assets (1) $ 11 Property and equipment 6 Goodwill 153 Identifiable intangible assets (2) 66 Current liabilities (3) ( 20 ) Long-term liabilities (4) ( 19 ) Total purchase price $ 198 ___________________________________ (1) Primarily trade receivables and net of approximately $ 9 million of cash acquired. (2) Primarily customer lists. (3) Primarily advanced collections from customers. (4) Includes $ 15 million of deferred tax liabilities recognized as a result of tax basis differences in intangible assets. The following unaudited pro forma consolidated financial information presents the combined operations of Terminix and Nomor for the year ended December 31, 2019 and 2018, as if the acquisition had occurred at the beginning of 2018: (Unaudited) Year Ended (In millions, except per share data) 2019 2018 Consolidated revenue $ 1,854 $ 1,705 Consolidated net income (loss) $ 137 $ ( 42 ) Basic earnings (loss) per share $ 1.01 $ ( 0.31 ) Diluted earnings (loss) per share $ 1.00 $ ( 0.31 ) ASC 805, “ Business Combinations ,” establishes guidelines regarding the presentation of the unaudited pro forma information. Therefore, this unaudited pro forma information is not intended to represent, nor do we believe it is indicative of, the consolidated results of operations of Terminix that would have been reported had the acquisition been completed at the beginning of 2018. This unaudited pro forma information does not give effect to the anticipated business and tax synergies of the acquisition and is not representative or indicative of the anticipated future consolidated results of operations of Terminix. The unaudited pro forma consolidated financial information reflects our historical financial information and the historical results of Nomor, after the conversion of Nomor’s accounting methods from local reporting standards to U.S. generally accepted accounting principles and adjusted to reflect the acquisition had it been completed as of the beginning of 2018. The most significant adjustments made to the pro forma financial information are the inclusion of $ 4 million of acquisition-related costs as if incurred in the first quarter of 2018, estimated quarterly interest expense of approximately $ 1 million related to financing obtained for the transaction and the estimated tax impact of these pro forma adjustments. The unaudited pro forma financial information includes various assumptions, including those related to the preliminary purchase price allocation, that may be impacted by the finalization of the purchase price allocation. The tax impact of these adjustments was calculated based on Nomor’s statutory rate. 2018 During the year ended December 31, 2018, we completed 20 acquisitions (the “2018 Acquisitions”), including the acquisition of Copesan, for an aggregate purchase price of $ 187 million, net of $ 2 million of cash acquired, using available cash on hand. All acquisitions were accounted for as business combinations. There are $ 65 million of deferred purchase price and earnouts contingent on the successful achievement of various metrics due to the sellers between one year and five years from the acquisition dates. The deferred purchase price and earnouts are recorded at fair value on the Consolidated Statements of Financial Position. Supplemental cash flow information regarding our acquisitions is as follows: Year Ended December 31, (In millions) 2020 2019 2018 Assets acquired $ 43 $ 590 $ 280 Liabilities assumed — ( 56 ) ( 30 ) Net assets acquired (1) $ 43 $ 535 $ 251 Net cash paid $ 36 $ 497 $ 187 Seller financed debt 7 38 64 Purchase price $ 43 $ 535 $ 251 ___________________________________ (1) Includes approximately $ 21 million, and $ 15 million of deferred tax liabilities in the years ended December 31, 2019 and 2018, respectively, as a result of tax basis differences in intangible assets. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Dec. 31, 2020 | |
Discontinued Operations [Abstract] | |
Discontinued Operations | Note 7. Discontinued Operations ServiceMaster Brands Divestiture Group In January 2020, we announced we were exploring strategic alternatives related to ServiceMaster Brands in order to focus on our core pest management and termite business. On October 1, 2020, we completed the sale of the ServiceMaster Brands Divestiture Group for $ 1,541 million, resulting in a gain of approximately $ 494 million, net of taxes. The gain is recorded in net earnings from discontinued operations. A portion of the proceeds was used to retire $ 750 million of our 5.125 % Notes due 2024 . The historical results of the ServiceMaster Brands Divestiture Group, including the results of operations, cash flows and related assets and liabilities, are reported as discontinued operations for all periods presented herein. For all periods after the sale, discontinued operations includes the gain on sale and incidental costs to complete the sale. In connection with the sale of the ServiceMaster Brands Divestiture Group, the Company and Roark entered into a transition services agreement (“TSA”) whereby the Company will provide certain post-closing services to Roark and ServiceMaster Brands related to the business of ServiceMaster Brands. The charges for the transition services are designed to allow us to fully recover the direct costs of providing the services, plus specified margins and any out-of-pocket costs and expenses. The Company and Roark also entered into a sublease agreement whereby ServiceMaster Brands will sublease a portion of our corporate headquarters in Memphis, Tennessee . We recognized approximately $ 6 million of TSA fees, rental income and other cost reimbursements in Selling and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss) in the year ended December 31, 2020. Payments received for TSA fees, other cost reimbursements and under the sublease agreement for rental income were $ 1 million in the year ended December 31, 2020. At December 31, 2020, we have a receivable from ServiceMaster Brands for $ 4 million included in Receivables on the Consolidated Statements of Financial Position. American Home Shield Spin-off On October 1, 2018, we completed the spin-off of our American Home Shield business. The separation was effectuated through a Distribution to our stockholders of approximately 80.2 percent of the outstanding shares of common stock of Frontdoor, the holding company created to hold the American Home Shield assets. The distribution was made to our stockholders of record as of the close of business on September 14, 2018, and such stockholders received one share of Frontdoor common stock for every two shares of Terminix common stock held as of the close of business on the Record Date. In March 2019, we exchanged all of the 19.8 percent of the outstanding shares of common stock of Frontdoor we retained for certain of our outstanding indebtedness, which obligations were subsequently cancelled and discharged upon delivery to us. See Note 11 for further discussion regarding this transaction. The historical results of the American Home Shield segment (Frontdoor), including the results of operations, cash flows and related assets and liabilities, are reported as discontinued operations for all periods presented herein. For all periods after the separation, discontinued operations includes spin-off transaction costs primarily related to transaction fees to effect the spin-off and receipts pursuant to the transition services agreement. In connection with the American Home Shield spin-off, the Company and Frontdoor entered into (1) a separation and distribution agreement containing key provisions relating to the separation of Frontdoor and the distribution of Frontdoor common stock to Terminix stockholders, as well as insurance coverage, non-competition, indemnification and other matters, (2) an employee matters agreement allocating liabilities and responsibilities relating to employee benefit plans and programs and other related matters and (3) a tax matters agreement governing the respective rights, responsibilities and obligations of the parties thereto with respect to taxes, including allocating liabilities for income taxes attributable to Frontdoor and its subsidiaries generally to the Company for tax periods (or portions thereof) ending on or before October 1, 2018, and generally to Frontdoor for tax periods (or portions thereof) beginning after that date. The charges for the transition services are designed to allow us to fully recover the direct costs of providing the services, plus specified margins and any out-of-pocket costs and expenses. The transition services agreement expired December 31, 2019. Under this transition services agreement, in the years ended December 31, 2019 and 2018, we recorded approximately $ 2 million and $ 1 million, respectively, of fees from Frontdoor, which are included, net of costs incurred, in Selling and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income (Loss). As of December 31, 2019, all amounts under this agreement have been paid. During the year ended December 31, 2018, we processed certain of Frontdoor’s accounts payable transactions. Through this process, in the year ended December 31, 2018, approximately $ 2 million was paid on Frontdoor’s behalf. We did not process any of Frontdoor’s accounts payable transactions in the year ended December 31, 2019. All amounts under this agreement have been paid. The Company and Frontdoor also entered into a sublease agreement for the space Frontdoor retained in our corporate headquarters and Memphis customer care center after the spin-off. We recognized approximately $ 4 million, $ 7 million and $ 1 million of rental income and other cost reimbursements related to these sublease agreements during the years ended December 31, 2020, 2019 and 2018, respectively, which were recorded as reductions to Selling and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss) . Payments received under the sublease agreements for rental income and other cost reimbursements during the years ended December 31, 2020, 2019 and 2018 totaled approximately $ 4 million, $ 7 million and $ 1 million, respectively. ServiceMaster Brands Divestiture Group and American Home Shield Goodwill and Intangible Assets Goodwill and indefinite lived intangible assets are assessed annually for impairment during the fourth quarter or earlier upon the occurrence of certain events or substantive changes in circumstances. No goodwill or indefinite-lived intangible asset impairments were recorded relating to ServiceMaster Brands or American Home Shield in the years ended December 31, 2020, 2019 and 2018. Financial Information for Discontinued Operations Net earnings from discontinued operations for all periods presented includes the operating results of the ServiceMaster Brands Divestiture Group and Frontdoor. The operating results of discontinued operations are as follows: Year Ended December 31, (In millions) 2020 2019 2018 Revenue $ 198 $ 258 $ 1,225 Cost of services rendered and products sold 93 110 630 Operating expenses (1) 56 58 343 Interest and net investment income — ( 1 ) ( 1 ) Income before income taxes 50 91 252 Provision for income taxes 12 22 66 Gain on sale, net of income taxes ( 494 ) — — Net earnings from discontinued operations $ 531 $ 69 $ 186 ___________________________________ (1) Includes $ 18 million of professional fees and other costs incurred in connection with the strategic evaluation and ultimate sale of the ServiceMaster Brands Divestiture Group in the year ended December 31, 2020, and Frontdoor spin-off related transaction costs of $ 35 million for the year ended December 31, 2018. The following table presents the aggregate carrying amount of the major classes of assets and liabilities of discontinued operations. At December 31, 2019, these balances reflect the historical assets and liabilities of the ServiceMaster Brands Divestiture Group, which was sold on October 1, 2020: (In millions) December 31, 2019 Assets of Discontinued Operations: Receivables, net $ 40 Inventories and other current assets 5 Current assets of discontinued operations 45 Property and equipment, net 8 Operating lease right-of-use assets 2 Goodwill 183 Intangible assets, net 622 Other long-term assets 19 Total Assets of Discontinued Operations $ 879 Liabilities of Discontinued Operations: Accounts payable $ 8 Accrued liabilities: Payroll and related expenses 5 Self-insured claims and related expenses — Accrued interest payable — Other 23 Deferred revenue 4 Current portion of lease liability 1 Current portion of long-term debt 1 Total Current Liabilities 42 Deferred taxes 1 Other long-term obligations 8 Long-term debt 2 Total Liabilities of Discontinued Operations $ 52 The following selected financial information of the ServiceMaster Brands Divestiture Group and Frontdoor is included in the Consolidated Statements of Cash Flows as cash flows from discontinued operations: Year Ended December 31, (In millions) 2020 2019 2018 Depreciation $ — $ 4 $ 11 Amortization $ 1 $ 4 $ 11 Cash paid for income taxes $ 372 — — Capital expenditures $ ( 2 ) $ ( 4 ) $ ( 20 ) |
Restructuring And Other Charges
Restructuring And Other Charges | 12 Months Ended |
Dec. 31, 2020 | |
Restructuring And Other Charges [Abstract] | |
Restructuring And Other Charges | Note 8. Restructuring and Other Charges Restructuring Charges We incurred restructuring charges of $ 16 million ($ 12 million, net of tax), $ 12 million ($ 9 million, net of tax) and $ 17 million ($ 12 million, net of tax) for the years ended December 31, 2020, 2019 and 2018, respectively. Restructuring charges are comprised of the following: Year Ended December 31, (In millions) 2020 2019 2018 Field Operations (1) $ 6 $ 5 $ 2 Headquarter operations (2) 9 5 6 Global Service Center relocation (3) — 1 8 Total restructuring and other charges $ 16 $ 12 $ 17 ___________________________________ (1) For the years ended December 31, 2020, 2019 and 2018, these charges included $ 6 million, $ 5 million and $ 2 million, respectively of lease termination and severance costs. For the year ended December 31, 2020, lease termination costs includes $3 million of impairment charges related to our former call center right of use assets and rent expense on leases we exited before the end of the lease term. Of this amount, $ 1 million was unpaid and accrued as of December 31, 2020. (2) For the year ended December 31, 2020, includes severance and charges to enhance capabilities and reduce costs in our corporate functions that provide administrative services to support operations and other costs to enhance capabilities and align functions after the sale of the ServiceMaster Brands Divestiture Group of $ 8 million and retention bonuses to employees key to effecting the sale of the ServiceMaster Brands Divestiture Group of $ 1 million. For the year ended December 31, 2019, these charges included $ 3 million of accelerated depreciation on systems we are replacing with the implementation of our customer experience platform, $ 1 million of professional fees and other costs to enhance capabilities and align corporate functions after the American Home Shield spin-off and $ 1 million of severance and other costs. For the year ended December 31, 2018, includes $ 3 million of severance and other costs and $ 4 million of costs to facilitate the American Home Shield spin-off that were not included in discontinued operations. Of this amount, $ 1 million was unpaid and accrued as of December 31, 2020. (3) For the year ended December 31, 2019, these charges included lease termination and other charges of $ 1 million. For the year ended December 31, 2018, these charges included $ 7 million of future rent and $ 1 million of professional and other fees. All amounts under these agreements have been paid as of December 31, 2020. The pretax charges discussed above are reported in Restructuring charges in the Consolidated Statements of Operations and Comprehensive Income (Loss). A reconciliation of the beginning and ending balances of accrued restructuring charges, which are included in Accrued liabilities—Other on the Consolidated Statements of Financial Position, is presented as follows: Accrued Restructuring (In millions) Charges Balance as of December 31, 2018 $ 7 Costs incurred 12 Costs paid or otherwise settled ( 18 ) Balance as of December 31, 2019 1 Costs incurred 16 Costs paid or otherwise settled ( 15 ) Balance as of December 31, 2020 $ 2 We expect substantially all of our accrued restructuring charges to be paid within one year. Other Charges Other charges represent professional fees incurred that are not closely associated with our ongoing operations. Other charges were $ 2 million ($ 2 million, net of tax) for the year ended December 31, 2019. We incurred no such other charges for the year ended December 31, 2020 or 2018. |
Commitments And Contingencies
Commitments And Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | Note 9. Commitments and Contingencies In the normal course of business, we periodically enter into agreements that incorporate indemnification provisions. While the maximum amount to which we may be exposed under such agreements cannot be estimated, we do not expect these guarantees and indemnifications to have a material effect on our business, financial condition, results of operations or cash flows. We carry insurance policies on insurable risks at levels that we believe to be appropriate, including workers’ compensation, automobile and general liability risks. We purchase insurance policies from third-party insurance carriers, which typically incorporate significant deductibles or self-insured retentions. We are responsible for all claims that fall below the retention limits, exceed our coverage limits or are otherwise not covered by our insurance policies. In determining our accrual for self-insured claims, we use historical claims experience to establish both the current year accrual and the underlying provision for future losses. This actuarially determined provision and related accrual include known claims, as well as incurred but not reported claims. We adjust our estimate of accrued self-insured claims when required to reflect changes based on factors such as changes in health care costs, accident frequency and claim severity. A reconciliation of beginning and ending accrued self-insured claims, which are included in Accrued liabilities—Self-insured claims and related expenses and Other long-term obligations, primarily self-insured claims on the Consolidated Statements of Financial Position, net of insurance recoverables, which are included in Prepaid expenses and other assets and Other assets on the Consolidated Statements of Financial Position, is presented as follows: Accrued Self-insured (In millions) Claims, Net Balance as of December 31, 2018 $ 111 Provision for self-insured claims 36 Cash payments ( 35 ) Balance as of December 31, 2019 111 Provision for self-insured claims 44 Cash payments ( 29 ) Balance as of December 31, 2020 $ 126 Our business is subject to a significant number of damage claims related to termite activity in homes for which we provide termite control services, often accompanied by a termite damage warranty. We believe our termite damage warranty is a differentiator in the industry that has enabled us to become the market leader of this product line. Damage claims include Non-litigated Claims and Litigated Claims. In recent years, we have experienced higher Non-Litigated Claims activity concentrated in the Mobile Bay Area of the United States related to Formosan termites, an invasive species, which has driven higher Non-Litigated Claims expense. In addition, since the beginning of 2017, we have been served with an increasing number of Litigated Claims, again primarily concentrated in the Mobile Bay Area and related to Formosan termite activity, which has driven higher Litigated Claim expense. Some plaintiffs have sought to demonstrate a pattern and practice of fraud in connection with Litigated Claims and have sought awards, in addition to repair costs, which included punitive damages and damages for mental anguish. We defend these Litigated Claims vigorously, and we are taking decisive actions to mitigate increasing claims costs, however, we cannot give assurance that these mitigation actions will be effective in reducing claims or costs related thereto, nor can we give assurance that lawsuits or other proceedings related to termite damage claims will not materially affect our reputation, business, financial position, results of operations and cash flows. We accrue for these liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated. Current activity can differ, causing a change in estimates which could be material. During the fourth quarter of the year ended December 31, 2019, we recorded a change in estimate of our reserve for termite damages for Litigated Claims and Non-Litigated Claims in the amount of $ 53 million as further described below. A reconciliation of beginning and ending accrued Litigated Claims, which are included in Accrued liabilities—Other and Other long-term obligations, primarily self-insured claims on the Condensed Consolidated Statements of Financial Position, and Non-Litigated Claims, which are included in Accrued liabilities—Self-insured claims and related expenses on the Condensed Consolidated Statements of Financial Position, is presented as follows: Accrued Termite Damage (In millions) Claims Balance as of December 31, 2018 $ 28 Provision for termite damage claims (1) 95 Cash payments ( 44 ) Balance as of December 31, 2019 80 Provision for termite damage claims 54 Cash payments ( 62 ) Balance as of December 31, 2020 $ 72 ___________________________________ (1) Includes a change in estimate of $ 53 million, as described below. 2019 Change in Estimate Beginning in 2018, we began being served with an increasing number of termite damage claims related lawsuits in certain geographies. Some plaintiffs have sought to demonstrate a pattern and practice of fraud in connection with these claims and have sought awards, in addition to repair costs, which included punitive damages and damages for mental anguish. In early 2020 we completed a detailed statistical analysis of our recent termite damage claims history and case results using the increased number of claims and concluded that given a then statistically meaningful population of outstanding Litigated Claims and sufficient history of resolving claims with similar attributes we were able to calculate an initial “best” estimate of the outcome of most of our cases based on variables known at the time each case is filed and not after a period of discovery which historically informed our estimates. As a result of this new estimation technique, we recorded a change in estimate of our reserve in the amount of $ 45 million in the year ended December 31, 2019. At the same time, we also began utilizing the aforementioned statistical analysis to evaluate our warranty reserves for Non-Litigated Claims. The resulting estimation technique projects the cost to settle Non-Litigated Claims considering both the expected geographic distribution of current and future claims and their relative cost to settle. Based on this review we recorded a change in estimate related to our reserve for Non-Litigated Claims in the amount of $ 8 million in the year ended December 31, 2019. Mobile Bay Formosan Termite Settlement In March 2019, Company representatives met with the AL AG and other Alabama state representatives to discuss termite renewal pricing changes we made in the Mobile Bay Area in 2019 and explain the Company’s perspective that the price increases complied with the ADTPA. Subsequently, in September 2019, we received a subpoena (the “AL Subpoena”) from the AL AG requesting documents and information under the ADTPA related to our Formosan termite business practices in the Mobile Bay area, largely focused on the termite renewal pricing changes we made in the Mobile Bay Area in 2019. Although the AL Subpoena requested broader information than that related to termite renewal pricing changes, we determined based on our prior interactions and evaluation of the matter that any potential exposure was not material to the Company. Over the course of several months, the Company produced the documents and information requested by the AL Subpoena. In August 2020, the AL AG expressed for the first time their belief that the Company’s inspection and treatment practices may have violated the ADTPA, and that they anticipated imposing certain potential unquantified remedies. In an effort to better understand these matters raised by the AL AG, Company representatives met with the AL AG in September 2020, at which point the AL AG provided details regarding the scope of the alleged potential ADTPA violations and of the potential remedies and the potential economic scope of those remedies. Following the September 2020 meeting with the AL AG, the Company determined that the inquiry could be material to its operations and financial results. In October 2020, Company representatives again met with the AL AG and the AL AG verbally presented allegations of ADTPA violations related to the 2019 price increase and certain inspection and treatment practices, as well as a draft consent decree to resolve those allegations. Over the next two weeks, the Company and the AL AG engaged in intensive negotiations and, on November 4, 2020, the Company entered into the Settlement with the AL AG. The Settlement provides for: immediate remediation measures to be provided directly to current and former customers in the Mobile Bay Area, including refunds of certain price increases, rebates to certain former customers, the establishment of a $ 25 million consumer fund and a related receiver to oversee our compliance with these commitments and to act as an arbitrator for certain Non-litigated Claims; the reimbursement of certain investigative and monitoring costs incurred by the Attorney General’s office and the Department of Agriculture and Industries; and a university endowment intended to support termite and pest management research with an emphasis on Formosan termite research. The Company has also agreed to pay the state of Alabama $ 19 million as a negotiated settlement. In the year ended December 31, 2020, the Company recorded a charge of $ 49 million and reduction of revenue of $ 4 million related to these remediation measures. These charges represent our best estimate and may change based on a variety of factors, including acceptance rates by current and former customers of the agreed remediation measures, and these changes could be material to our financial results. Pursuant to the Settlement, we have also agreed to provide the opportunity to reinstate service for certain customers who canceled their services during specified timeframes as well as the retreatment of certain customer premises and a commitment to certain specified response and remediation timeframes for future termite damage claims. We do not expect the financial impact of these remedies to have a material impact on our prospective results of operations or cash flows. In accordance with the Settlement, the Company funded the $ 25 million consumer fund, from which certain monetary liabilities from settlements of, or judgments in, the covered Settlement are paid by the fund’s receiver. The amount in the consumer fund is held in escrow by the receiver and is classified as a deposit within Prepaid expenses and other assets and with an offsetting liability recorded within Accrued liabilities – Other on the Consolidated Statements of Financial Position. In the year ended December 31, 2020, we made $ 49 million of payments in connection with our settlement with the AL AG, which are reflected as Payments on Mobile Bay Formosan termite settlement on the Consolidated Statements of Cash Flows . Fumigation Related Matters On December 16, 2016, the U.S. Virgin Islands Department of Justice filed a civil complaint in the Superior Court of the Virgin Islands related to the aforementioned fumigation incident in a matter styled Government of the United States Virgin Islands v. The ServiceMaster Company, LLC, The Terminix International Company Limited Partnership, and Terminix International USVI, LLC. The amount and extent of any further potential penalties, fines, sanctions, costs and damages that the federal or other governmental authorities may yet impose, investigation or other costs and reputational harm, as well as the impact of any additional civil, criminal or other claims or judicial, administrative or regulatory proceedings resulting from or related to the U.S. Virgin Islands matter, which could be material, is not currently known, and any such further penalties, fines, sanctions, costs or damages would not be covered under the Company’s general liability insurance policies. On January 20, 2017, TMX USVI and TMX LP, each an indirect, wholly-owned subsidiary of the Company, entered into a revised Plea Agreement in connection with the investigation initiated by the DOJ into allegations that a local Terminix branch used methyl bromide as a fumigant at a resort in St. John, U.S. Virgin Islands. Under the terms of sentencing handed down on November 20, 2017, (i) TMX USVI and TMX LP each paid a fine of $ 4.6 million (total of $ 9.2 million); (ii) TMX USVI and TMX LP paid a total of $ 1.2 million to the EPA for costs incurred by the EPA for the response and clean-up of the affected units at the resort in St. John; and (iii) both TMX USVI and TMX LP will serve a five year probation period. In lieu of the $ 1 million community service payment that was proposed in the Plea Agreement, the court required TMX USVI and TMX LP to provide for training certification courses with respect to pesticide application and safety in the U.S. Virgin Islands until November 2022. Other Litigation In addition to the matters discussed above, in the ordinary course of conducting business activities, we and our subsidiaries become involved in judicial, administrative and regulatory proceedings involving both private parties and governmental authorities. These proceedings include insured and uninsured matters that are brought on an individual, collective, representative and class action basis, or other proceedings involving regulatory, employment, general and commercial liability, automobile liability, wage and hour, environmental and other matters. We have entered into settlement agreements in certain cases, including with respect to putative collective and class actions, which are subject to court or other approvals. If one or more of our settlements are not finally approved, we could have additional or different exposure, which could be material. Subject to the paragraphs below, we do not expect any of these proceedings to have a material effect on our reputation, business, financial position, results of operations or cash flows; however, we can give no assurance that the results of any such proceedings will not materially affect our reputation, business, financial position, results of operations and cash flows . |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2020 | |
Employee Benefit Plans [Abstract] | |
Employee Benefit Plans | Note 10. Employee Benefit Plans Discretionary contributions to our 401(k) plan were made in the amount of $ 14 million, $ 14 million and $ 13 million for the years ended December 31, 2020, 2019 and 2018, respectively. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2020 | |
Long-Term Debt [Abstract] | |
Long-Term Debt | Note 11. Long-Term Debt Long-term debt is summarized in the following table: As of December 31, (In millions) 2020 2019 Senior secured term loan facility maturing in 2026 (1) 539 593 5.125 % notes maturing in 2024 (2) — 742 7.45 % notes maturing in 2027 (3) 169 167 7.25 % notes maturing in 2038 (3) 41 40 Vehicle finance leases (4) 95 99 Other (5) 77 94 Less current portion (6) ( 94 ) ( 69 ) Total long-term debt $ 826 $ 1,666 ___________________________________ (1) As of December 31, 2020 and 2019, presented net of $ 7 million and $ 6 million, respectively, in unamortized debt issuance costs and $ 1 million and $ 1 million, respectively, in unamortized original issue discount paid as described below under “––Term Loan Facility.” (2) The 5.125 % Notes were retired on November 16, 2020, resulting in a loss on extinguishment of debt of $ 19 million. As of December 31, 2019, presented net of $ 8 million in unamortized debt issuance costs related to the 2024 notes. (3) As of December 31, 2020 and 2019, presented net of $ 25 million and $ 28 million, respectively, in unamortized fair value adjustments related to purchase accounting, which increases the effective interest rate from the coupon rates shown above. (4) We have entered into the Fleet Agreement which, among other things, allows us to obtain fleet vehicles through a leasing program. All leases under the Fleet Agreement are finance leases for accounting purposes. The lease rental payments include an interest component calculated using a variable rate based on one-month LIBOR plus other contractual adjustments and a borrowing margin ranging from 1.41 % to 2.45 % . (5) As of December 31, 2020 and 2019, includes approximately $ 76 million and $ 88 million, respectively, of future payments in connection with acquisitions. (6) The current portion of long-term debt consists of deferred purchase price and earnout payments on acquisitions, including approximately $ 50 million due to the former owners of Copesan in 2021, and scheduled principal payments of long-term debt due within 12 months. Term Loan Facility On November 5, 2019, we closed on an amended $ 600 million Term Loan B due 2026, as well as a $ 400 million revolving credit agreement due 2024 (the “Amended Term Loan Facility”). The proceeds of the transaction were used to repay approximately $ 171 million of debt outstanding under our previous Term Loan B due 2023, $ 120 million outstanding under our previous revolving credit agreement due 2021, as well as $ 150 million from a recent short-term borrowing entered on October 4, 2019. In addition, $ 6 million of proceeds was used to pay debt issuance costs of $ 5 million and original issue discount of $ 1 million. In connection with the repayment, we recorded a loss on extinguishment of debt of $ 1 million which includes the write-off of debt issuance costs. In connection with the repayment of our previous Term Loan B due 2023, we terminated our then existing interest rate swap agreement, receiving $ 12 million. The fair value of the terminated agreement of $ 12 million is recorded within accumulated other comprehensive income on the Consolidated Statements of Financial Position and will be amortized into interest expense over the original term of the agreement. Concurrent with the refinancing, we entered into a seven year interest swap agreement effective November 5, 2019. The notional amount of the agreement is $ 550 million, of which $ 546 million remains in effect as of December 31, 2020. Under the terms of the agreement, we will pay a fixed rate of interest of 1.615 % on the $ 550 million notional amount, and we will receive a floating rate of interest (based on one-month LIBOR, subject to a floor of zero percent) on the notional amount. Therefore, during the remaining term of the agreement, the effective interest rate on $ 546 million of the new Term Loan B is fixed at a rate of 3.365 %. On September 30, 2020, we amended our Term Loan B agreement to permit proceeds from the sale of the ServiceMaster Brands Divestiture Group to be used to retire subordinated debt or pay shareholder returns. In connection with the amendment, we made an advanced amortization payment of $ 51 million and terminated $ 4 million of our interest rate swap. The amendment was treated as a debt modification. We recorded $ 2 million in debt issuance costs related to the amendment. Such advanced amortization payment resulted in a loss on extinguishment of debt of $ 1 million for the year ended December 31, 2020. The interest rates applicable to the loans under the Amended Term Loan Facility are based on a fluctuating rate of interest measured by reference to either, at the borrower’s option, (i) an adjusted London inter-bank offered rate (“LIBOR”) plus 1.75 % per annum, or (ii) an alternate base rate (“ABR”) plus 0.75 % per annum. Voluntary prepayments of borrowings under the Amended Term Loan Facility are permitted at any time, in minimum principal amounts, without premium or penalty. The Term Loan Facility and the guarantees thereof are secured by substantially all of the tangible and intangible assets of the Company and certain of our domestic subsidiaries, excluding certain subsidiaries subject to regulatory requirements in various states, including pledges of all the capital stock of all direct domestic subsidiaries (other than foreign subsidiary holding companies, which are deemed to be foreign subsidiaries) owned by the Company or any Guarantor and of up to 65 % of the capital stock of each direct foreign subsidiary owned by the Company or any Guarantor. The Term Loan Facility security interests are subject to certain exceptions, including, but not limited to, exceptions for (i) equity interests, (ii) indebtedness or other obligations of subsidiaries, (iii) real estate or (iv) any other assets, if the granting of a security interest therein would require that the 7.45 % Notes maturing in 2027 or 7.25 % Notes maturing in 2038 be secured. The Term Loan Facility is secured on a pari passu basis with the security interests created in the same collateral securing the Revolving Credit Facility. Interest Rate Swap Agreements We have historically entered into interest rate swap agreements. Under the terms of these agreements, we pay a fixed rate of interest on the stated notional amount and receive a floating rate of interest (based on one month LIBOR) on the stated notional amount. Therefore, during the term of the swap agreements, the effective interest rate on the portion of the term loans equal to the stated notional amount is fixed at the stated rate in the interest rate swap agreements plus the incremental borrowing margin. The changes in interest rate swap agreements, as well as the cumulative interest rate swaps outstanding, are as follows: Weighted Notional Average Fixed (In millions) Amount Rate (1) Interest rate swap agreements in effect as of December 31, 2018 $ 650 1.493 % Terminated ( 650 ) Entered into effect 550 1.615 % Interest rate swap agreements in effect as of December 31, 2019 550 1.615 % Terminated ( 4 ) Entered into effect — Interest rate swap agreements in effect as of December 31, 2020 $ 546 1.615 % ___________________________________ (1) Before the application of the applicable borrowing margin. In accordance with accounting standards for derivative instruments and hedging activities, and as further described in Note 17 to the consolidated financial statements, these interest rate swap agreements are classified as cash flow hedges, and, as such, the hedging instruments are recorded on the Consolidated Statements of Financial Position as either an asset or liability at fair value, with the effective portion of the changes in fair value attributable to the hedged risks recorded in Accumulated other comprehensive income (loss). Extinguishment of Debt and Repurchase of Notes On November 16, 2020, we used a portion of the proceeds from the sale of ServiceMaster Brands and retired all $ 750 million of our existing 5.125 % Notes due 2024, plus applicable accrued interest. In connection with the retirement of the Notes, we paid a prepayment penalty of approximately $ 19 million. In connection with the retirement, we recorded a loss on extinguishment of debt of $ 25 million, which includes the prepayment penalty and the write-off of debt issuance costs. In connection with the spin-off of the American Home Shield Segment, we borrowed an aggregate principal amount of $ 1 billion under a short-term credit facility on August 1, 2018, the proceeds of which were used to prepay $ 982 million aggregate principal amount of term loans outstanding under our senior secured term loan facility. Such prepayment resulted in a loss on extinguishment of debt of $ 10 million for the year ended December 31, 2018. On August 16, 2018, Frontdoor incurred in favor of the Company $ 350 million aggregate principal of 6.75 % Notes due 2026 and a $ 650 million senior secured term loan facility, and obtained a $ 250 million senior secured revolving credit facility. We then transferred and assigned our rights and obligations in respect of Frontdoor’s senior notes and senior secured term loan facility to the lender under such short-term credit facility through a debt-for-debt exchange to satisfy our obligations thereunder. On October 1, 2018, in connection with the spin-off of the American Home Shield segment, Frontdoor’s senior secured term loan facility and senior notes were included in the transfer of assets and liabilities to Frontdoor, reducing our total long-term debt by approximately $ 1 billion. On March 12, 2019, we borrowed an aggregate principal amount of $ 600 million under a short-term credit facility to effectuate a debt-for-equity exchange of our Frontdoor retained shares. The proceeds of this short-term credit facility were used to repay $ 468 million aggregate principal amount of term loans outstanding under our senior secured term loan facility in March and April of 2020. Such prepayments resulted in a loss on extinguishment of debt of $ 4 million for the year ended December 31 , 2019. On March 27, 2019, we completed a non-cash debt-for-equity exchange in which we exchanged the 16.7 million retained shares of Frontdoor common stock (proceeds of $ 486 million, net), plus used $ 114 million of proceeds from the short-term credit facility, to extinguish $ 600 million of our indebtedness under the short-term credit facility. The sale of the Frontdoor common stock resulted in a realized gain of $ 40 million, which was recorded within (Gain) loss on investment in frontdoor, inc. on the consolidated statements of operations and comprehensive income for the year ended December 31 , 2019. In March 2019, we purchased approximately $ 7 million in aggregate principal amount of our 7.45 % Notes maturing in 2027 at a price of 105.5 % and $ 3 million in aggregate principal amount of our 7.25 % Notes maturing in 2038 at a price of 99.5 % using available cash. The repurchased notes were delivered to the trustee for cancellation. In connection with these partial repurchases, we recorded a loss on extinguishment of debt of $ 2 million in the year ended December 31 , 2019. In April 2019, we purchased $ 1 million in aggregate principal amount of our 7.45 % Notes maturing in 2027 at a price of 105.5 %. Revolving Credit Facility On November 8, 2016, we entered into a $ 300 million Revolving Credit Facility (the “Old Revolving Credit Facility”). The maturity date for the Old Revolving Credit Facility was November 8, 2021 . The Old Revolving Credit Facility provides for senior secured revolving loans and stand-by and other letters of credit. The Old Revolving Credit Facility limited outstanding letters of credit to $ 225 million. On September 5, 2019, we borrowed an aggregate principal amount of $ 120 million under the Old Revolving Credit Facility to finance our acquisition of Nomor. On November 5, 2019, we repaid the $ 120 million outstanding. On December 12, 2019, in connection with our refinancing, we terminated the Old Revolving Credit Facility and entered into a $ 400 million Revolving Credit Facility. The maturity date for the Revolving Credit Facility is November 5, 2024 . The Revolving Credit Facility provides for senior secured revolving loans and stand - by and other letters of credit. The Revolving Credit Facility limits outstanding letters of credit to $ 125 million. As of December 31, 2020, there were $ 23 million of letters of credit outstanding and $ 377 million of available borrowing capacity under the Revolving Credit Facility. The Revolving Credit Facility and the guarantees thereof are secured by the same collateral securing the Term Loan Facility, on a pari passu basis with the security interests created in the same collateral securing the Term Loan Facility. The interest rates applicable to the loans under the Revolving Credit Facility are based on a fluctuating rate of interest measured by reference to either, at our option, (i) an adjusted LIBOR plus a margin of 1.75 % per annum or (ii) an alternate base rate plus a margin of 1.50 % per annum. Other The agreements governing the Term Loan Facility and the Revolving Credit Facility contain certain covenants that, among other things, limit or restrict the incurrence of additional indebtedness, liens, sales of assets, certain payments (including dividends) and transactions with affiliates, subject to certain exceptions. We were in compliance with the covenants under these agreements at December 31, 2020. As of December 31, 2020, future scheduled long - term debt payments are $ 94 million, $ 30 million, $ 21 million, $ 15 million, and $ 11 million for the years ended December 31, 2021, 2022, 2023, 2024 and 2025 respectively. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases | Note 12. Leases As of December 31, 2020 and 2019, assets recorded under finance leases were $ 249 million and $ 220 million, respectively, and accumulated depreciation associated with finance leases was $ 155 million and $ 127 million, respectively. The components of lease expense were as follows: Year ended December 31, (In millions) 2020 2019 Finance lease cost Depreciation of finance lease ROU assets $ 39 $ 35 Interest on finance lease liabilities 3 5 Operating lease cost 25 26 Variable lease cost 2 3 Sublease income ( 3 ) ( 2 ) Total lease cost $ 66 $ 67 Supplemental cash flow information and other information for leases was as follows: Year ended December 31, (In millions) 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 27 $ 24 Operating cash flows for finance leases $ 3 $ 5 Financing cash flows for finance leases $ 38 $ 34 ROU assets obtained in exchange for lease obligations: Operating leases $ 4 $ 12 Finance leases $ 36 $ 43 Weighted Average Remaining Lease Term (in years): Operating leases 10.52 10.58 Finance leases 3.44 3.34 Weighted Average Discount Rate: Operating leases 5.30 % 5.55 % Finance leases 4.86 % 4.13 % We acquired $ 35 million of property and equipment through finance leases and other non-cash financing transactions in the year ended December 31, 2018, which has been excluded from the Consolidated Statements of Cash Flows as non-cash investing and financing activities. As of December 31, 2020 and 2019, there were $ 35 million of finance leases included within Current portion of long-term debt, and $ 60 million of finance leases included within Long-term debt on the Consolidated Statements of Financial Position. As of December 31, 2020, we have additional vehicle finance leases that have not yet commenced of $ 2 million. These leases are scheduled to commence in 2021 with lease terms generally of five years . Future minimum lease payments under non-cancellable leases as of December 31, 2020 were as follows: (In millions) Operating Leases (1) Finance Leases Year ended December 31, 2021 $ 23 $ 36 2022 20 26 2023 15 19 2024 12 11 2025 10 6 Thereafter 72 3 Total future minimum lease payments 152 100 Less imputed interest ( 39 ) ( 5 ) Total $ 113 $ 95 ___________________________________ (1) Each year through 2033 is presented net of approximately $ 3 million of projected annual sublease income from ServiceMaster Brands and Frontdoor for their subleases of our headquarters. Sublease income of approximately $ 3 million, $ 2 million and $ 1 million was recognized within Selling and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, 2020, 2019 and 2018, respectively. Practical Expedients We adopted the new standard using the modified retrospective approach and applied the transition approach as of the beginning of the period of adoption. We adopted the package of practical expedients and therefore did not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs for all leases. We elected to make the accounting policy election for short-term leases resulting in lease payments being recorded as an expense on a straight-line basis over the lease term. We elected to not separate lease and non-lease components for real estate operating leases. We did not elect the hindsight practical expedient. |
Comprehensive Income (Loss)
Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2020 | |
Comprehensive Income (Loss) [Abstract] | |
Comprehensive Income (Loss) | Note 13. Comprehensive Income (Loss) Comprehensive Income (loss), which primarily includes net income (loss), unrealized gains on derivative instruments and the effect of foreign currency translation (loss) gain, is disclosed in the Consolidated Statements of Operations and Comprehensive Income (Loss). During the year December 31, 2019, we terminated our $ 650 million interest rate swap and received $ 12 million from the counterparty. The fair value of the terminated portion of the interest rate swap of $ 12 million was recorded within accumulated other comprehensive income on the Consolidated Statements of Financial Position and is being amortized into interest expense over the original term of the agreement. The remaining unamortized balance at December 31, 2020 is approximately $ 6 million. The following tables summarize the activity in accumulated other comprehensive income, net of the related tax effects. Foreign Unrealized Currency Gains (Losses) on Translation (In millions) Derivatives (Loss) Gain Total Balance as of December 31, 2018 $ 20 $ ( 15 ) $ 5 Other comprehensive income before reclassifications: Pre-tax amount ( 7 ) 10 3 Tax provision 5 — 5 After-tax amount ( 2 ) 10 8 Amounts reclassified from accumulated Other Comprehensive Income (Loss) (1) ( 4 ) — ( 4 ) Net current period other comprehensive loss ( 6 ) 10 4 Balance as of December 31, 2019 $ 13 $ ( 5 ) $ 9 Other comprehensive income before reclassifications: Pre-tax amount ( 83 ) 2 ( 82 ) Tax provision 10 — 10 After-tax amount ( 73 ) 2 ( 71 ) Amounts reclassified from accumulated other comprehensive (loss) income (1) 19 — 19 Amounts reclassified due to the sale of ServiceMaster Brands Divestiture Group (2) — 5 5 Total amounts reclassified from accumulated other comprehensive income 19 5 24 Amounts reclassified within accumulated other comprehensive (loss) income (3) 25 ( 25 ) — Net current period other comprehensive income ( 29 ) ( 18 ) ( 47 ) Balance as of December 31, 2020 $ ( 16 ) $ ( 23 ) $ ( 39 ) ___________________________________ (1) Amounts are net of tax. See reclassifications out of accumulated other comprehensive income below for further details. (2) Represents ServiceMaster Brands foreign currency translation gains (losses) that were reclassified as part of the gain recognized in Net earnings from discontinued operations upon the sale of the ServiceMaster Brands Divestiture Group. (3) Represents reclassifications from our net investment hedge related to foreign currency exchange rate fluctuations. Reclassifications out of accumulated other comprehensive income included the following components for the periods indicated. Amounts Reclassified from Accumulated Other Comprehensive Income As of December 31, (In millions) 2020 2019 2018 Gains (losses) on derivatives: Fuel swap contracts $ ( 4 ) $ — $ 3 Interest rate swap contract ( 4 ) 5 1 Cross-currency interest rate swap ( 14 ) — — Net (losses) gains on derivatives ( 21 ) 5 4 Sale of ServiceMaster Brands Divestiture Group ( 5 ) — — Impact of income taxes 2 — ( 1 ) Total reclassifications for the period $ ( 24 ) $ 4 $ 3 |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Dec. 31, 2020 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Cash Flow Information | Note 14. Supplemental Cash Flow Information Supplemental information relating to the Consolidated Statements of Cash Flows is presented in the following table: Year Ended December 31, (In millions) 2020 2019 2018 Cash paid for or (received from): Interest expense (1) $ 81 $ 82 $ 122 Interest and dividend income ( 1 ) ( 3 ) ( 2 ) Income taxes, net of refunds 4 25 52 ___________________________________ (1) For the year ended December 31, 2019, excludes $ 12 million received in connection with our terminated interest rate swap. Cash and Cash Equivalents and Restricted Cash at Beginning of Period on the Consolidated Statements of Cash Flows consists of the following as presented on the Consolidated Statements of Financial Position: Year Ended December 31, (In millions) 2020 2019 2018 Cash and cash equivalents $ 615 $ 280 $ 224 Restricted cash 89 89 89 Total Cash and cash equivalents and Restricted cash $ 704 $ 368 $ 313 The proceeds from the Frontdoor debt issuances described in Note 11 were retained by the lender in satisfaction of the short-term credit facility and have been excluded from the Consolidated Statements of Cash Flows as non-cash financing activities. The non-cash lease transactions resulting from our adoption of ASC 842 are described in Note 12. |
Capital Stock
Capital Stock | 12 Months Ended |
Dec. 31, 2020 | |
Capital Stock [Abstract] | |
Capital Stock | Note 15. Capital Stock We are authorized to issue 2,000,000,000 shares of common stock. As of December 31, 2020, there were 148,400,384 shares of common stock issued and 132,080,845 shares of common stock outstanding. We have no other classes of equity securities issued or outstanding. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2020 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | Note 16. Stock-Based Compensation In connection with our initial public offering, our board of directors and stockholders adopted the Omnibus Incentive Plan. Prior to our initial public offering, our board of directors and stockholders had adopted the Amended and Restated ServiceMaster Global Holdings, Inc. Stock Incentive Plan, as amended as of October 25, 2012 (the “MSIP”). Upon adoption of the Omnibus Incentive Plan, we froze the MSIP and will make no further grants thereunder. However, awards previously granted under the MSIP are unaffected by the termination of the MSIP. The Omnibus Incentive Plan provides for awards in the form of stock options, stock purchase rights, restricted stock, RSUs, performance shares, performance units, stock appreciation rights, dividend equivalents, DSUs, deferred share equivalents, and other stock-based awards. The MSIP provided for the sale of shares and DSUs of our stock to our executives, officers and other employees and to our directors as well as the grant of RSUs, performance-based RSUs and options to purchase our shares to those individuals. Our Compensation Committee selects our executive officers, employees and directors eligible to participate in the Omnibus Incentive Plan and determines the specific number of shares to be offered or options to be granted to an individual. On February 24, 2015, our board of directors approved and recommended for approval by our stockholders the Employee Stock Purchase Plan, which became effective for offering periods commencing July 1, 2015. The Employee Stock Purchase Plan is intended to qualify for the favorable tax treatment under the Code. Under the plan, eligible employees may purchase common stock, subject to Internal Revenue Service limits, during pre-specified offering periods at a discount established by us not to exceed ten percent of the then-current fair market value. On April 27, 2015, our stockholders approved the Employee Stock Purchase Plan with a maximum of one million shares of common stock authorized for sale under the plan. Under the Employee Stock Purchase Plan, we sold 45,840 shares in 2020, 14,429 shares in 2019, and no shares in 2018 . As of December 31, 2020, there were 783,315 shares of our common stock reserved for future issuances under the Employee Stock Purchase Plan. A maximum of 16,396,667 shares of our stock is authorized for issuance under the MSIP, the Omnibus Incentive Plan and the Employee Stock Purchase Plan, of which, as of December 31, 2020, 5,133,314 shares remain available for future grants. We currently intend to satisfy any need for our shares of common stock associated with the vesting of RSUs, exercise of options or purchase of shares issued under the Omnibus Incentive Plan, MSIP or Employee Stock Purchase Plan through new shares available for issuance or any shares repurchased, forfeited or surrendered from participants in the MSIP and the Omnibus Incentive Plan. All option grants under the Omnibus Incentive Plan and the MSIP have been, and we expect that all future option grants will be, non-qualified options with a per-share exercise price no less than the fair market value of one share of our stock on the grant date. Any stock options granted prior to 2019 generally have a term of 10 years and vesting will be subject to an employee’s continued employment. In February 2019, our board of directors approved an amended Employee Stock Option Agreement, whereby all options granted in 2019 and thereafter will generally vest in three equal annual installments (rather than four), have a term of eight years (rather than 10 years) and remain subject to an employee’s continued employment. The three year vesting period is the requisite service period over which compensation cost will be recognized on a straight-line basis for all grants. All options issued are accounted for as equity-classified awards. Our Compensation Committee may accelerate the vesting of an option at any time. In addition, vesting of options will be accelerated if we experience a change in control (as defined in the Omnibus Incentive Plan and the MSIP) unless options with substantially equivalent terms and economic value are substituted for existing options in place of accelerated vesting. Our stock option awards also have a “double-trigger provision” that provides for acceleration in the event of a change in control and subsequent termination of the employee from the acquiring company within 24 months of the change in control. For RSUs granted in July 2018 or thereafter, the Compensation Committee revised the RSU award agreements to include a double trigger provision relating to the acceleration of vesting RSUs on a change in control and subsequent termination of the employee from the acquiring company within 24 months of the change in control. Vesting of options and RSUs granted under the Omnibus Incentive Plan and the MSIP will also be accelerated, in whole or in part, in the event of an employee’s death or disability (as defined in the Omnibus Incentive Plan and the MSIP). Upon termination for cause (as defined in the Omnibus Incentive Plan and the MSIP), all options and RSUs held by an employee are immediately cancelled. Following a termination without cause, vested options will generally remain exercisable through the earlier of the expiration of their term or three months following termination of employment ( one year in the case of death, disability or retirement at normal retirement age). Unless sooner terminated by our board of directors, the Omnibus Incentive Plan will remain in effect until June 26, 2024. In 2020, 2019 and 2018, we completed various equity offerings to certain of our executives, officers and employees pursuant to the Omnibus Incentive Plan. The shares sold and options granted in connection with these equity offerings are subject to and governed by the terms of the Omnibus Incentive Plan. No other shares of common stock were sold by us in 2020, 2019 or 2018. Stock Options We granted our executives, officers and employees options to purchase 1,003,180 ; 634,743 ; and 502,004 shares of our common stock in 2020, 2019 and 2018, respectively, at a weighted-average exercise price of $ 36.51 per share for options issued in 2020, $ 40.04 per share for options issued in 2019, and $ 55.18 per share for options issued in 2018. These options are subject to and governed by the terms of the MSIP and Omnibus Incentive Plan. The per share purchase price and exercise price was based on the determination by our Compensation Committee of the fair market value of our common stock as of the purchase/grant dates. All options granted prior to 2020 generally will vest in four equal annual installments, while all options granted in 2020 generally will vest in three equal annual installments, subject to an employee’s continued employment. The three year and four year vesting periods are the requisite service period over which compensation cost will be recognized on a straight-line basis for all grants made in 2019 and 2020, and prior to 2019, respectively. All options issued are accounted for as equity-classified awards. The value of each option award was estimated on the grant date using the Black-Scholes option valuation model that incorporates the assumptions noted in the following table. For options granted in 2020, 2019 and 2018, the expected volatility was based on historical and implied volatilities of our publicly traded stock. The expected life represents the period of time that options granted are expected to be outstanding and was calculated using the simplified method as outlined by the SEC in Staff Accounting Bulletins No. 107 and 110 as we do not have sufficient historical exercises to provide a reasonable basis upon which to estimate expected life due to the limited period of time our equity shares have been publicly traded. The risk-free interest rates were based on U.S. Treasury securities with terms similar to the expected lives of the options as of the grant dates. Year Ended December 31, Assumption 2020 2019 2018 Expected volatility 33.8 % 28.4 % 25.9 % Expected dividend yield 0.0 % 0.0 % 0.0 % Expected life (in years) 4.9 5.0 6.3 Risk-free interest rate 0.27 % - 1.38 % 2.49 % 2.63 % - 2.94 % The weighted-average grant-date fair value of the options granted during 2020, 2019 and 2018 was $ 11.23 , $ 11.91 and $ 17.68 per option, respectively. During the year ended December 31, 2020, we applied a forfeiture assumption of 25.52 percent per annum in the recognition of the expense related to these options, with the exception of the options held by our CEO for which we applied a forfeiture rate of zero . The total intrinsic value of stock options exercised during the years ended December 31, 2020, 2019 and 2018, was $ 2 million, $ 10 million and $ 6 million, respectively. The total fair value of stock options vested during the years ended December 31, 2020, 2019 and 2018, was $ 5 million, $ 3 million and $ 3 million, respectively. A summary of option activity under the MSIP and Omnibus Incentive Plan as of December 31, 2020 and changes during the year then ended is presented below: Aggregate Weighted Avg. Weighted Avg. Intrinsic Remaining Stock Exercise Value Contractual Options Price (in millions) Term (in years) Total outstanding, December 31, 2019 1,230,520 $ 35.30 $ 5 7.36 Granted to employees 1,003,180 $ 36.52 Exercised ( 204,768 ) $ 32.55 Forfeited ( 588,504 ) $ 36.82 Expired ( 150,104 ) $ 50.01 Total outstanding, December 31, 2020 1,290,324 $ 36.47 $ 19 6.74 Total exercisable, December 31, 2020 338,025 $ 34.67 $ 6 6.27 RSUs We granted our executives, officers and employees 567,844 ; 516,775 ; and 354,931 ; RSUs in 2020, 2019 and 2018, respectively, with weighted-average grant date fair values of $ 37.81 per unit for 2020, $ 42.11 per unit for 2019, and $ 52.40 per unit for 2018, which was equivalent to the then current fair value of our common stock at the grant date. All RSUs outstanding as of December 31, 2020, will vest in three equal annual installments, subject to an employee’s continued employment. Upon vesting, each RSU will be converted into one share of our common stock. The total fair value of RSUs vested during the years ended December 31, 2020, 2019 and 2018, was $ 10 million, $ 8 million and $ 18 million, respectively. On January 1, 2019, in connection with an acquisition, we granted 136,092 RSUs to an executive key to our urban markets strategy. All such RSUs cliff vest on the third anniversary of their grant and are subject to the executive’s continued employment. On September 15, 2020, we granted retention RSUs with a fair value of $ 2 million to Kim Scott, President, Terminix Residential and Gregory L. Rutherford, President, Terminix Commercial, with a weighted average exercise price $ 40.67 . The RSUs vest on the first anniversary of the grant date, subject to continued employment through such date, and will vest on a pro rata basis if Ms. Scott or Mr. Rutherford is terminated by the Company before such date, calculated from the grant date through the date of termination. On January 22, 2021, Terminix announced that Mr. Rutherford will be leaving Terminix as of March 15, 2021. Mr. Rutherford’s $ 1 million retention award equated to 24,589 restricted stock units; pursuant to the terms of that award, on March 15, 2021, a pro-rated number of those units will vest, entitling him to 12,194 shares of Terminix common stock. A summary of RSU activity under the Omnibus Incentive Plan as of December 31, 2020, and changes during the year then ended is presented below: Weighted Avg. Grant Date RSUs Fair Value Total outstanding, December 31, 2019 692,926 $ 40.11 Granted to employees 567,844 $ 37.81 Vested ( 262,013 ) $ 46.56 Forfeited ( 245,845 ) $ 44.75 Total outstanding, December 31, 2020 752,912 $ 40.53 Performance Shares We granted our executives 95,916 performance shares in 2020 with a weighted-average grant date fair value of $ 36.99 per share, and 107,149 performance shares in 2019 with a weighted–average grant date fair value of $ 40.04 per share, which were equivalent to the then current fair value of our common stock at the grant date. The performance shares vest at the end of a three year period based on the achievement of a cumulative revenue and Adjusted EPS targets established at the grant date and subject to an executive’s continued employment. As the performance shares contain a performance condition, stock-based compensation expense, net of estimated forfeitures, is recorded over the requisite service period based on the number of awards expected to vest. No performance shares were granted in 2018 due the complexities in determining longer-term financial goals given the spin-off and financial separation of the American Home Shield business. In 2020 and 2019, we granted 38,178 and 8,912 , respectively, of performance shares to key management in connection with a strategic acquisition. The grants had a grant date fair value of $ 36.35 per share and $ 56.11 per share, respectively, which represented the then current fair values of our common stock at the grant dates. These performance shares are scheduled to vest on December 31, 2023, based on the achievement of four year cumulative Adjusted EPS and revenue targets established at the grant date and subject to continued employment. As the performance shares contain a performance condition, stock-based compensation expense, net of estimated forfeitures, is recorded over the requisite service period based on the number of awards expected to vest. In 2019, we granted 87,920 of performance shares to Nomor executives in connection with the acquisition. The grant had a grant date fair value of $ 56.87 per share, which represented the then current fair value of our common stock at the grant date. These performance shares are scheduled to vest on December 31, 2022, based on the achievement of three year cumulative Adjusted EPS and revenue targets established at the grant date and subject to an executive’s continued employment. These awards were cancelled in 2020 as a result of the impact of COVID-19 on the financial performance of Nomor. The performance share awards were significantly below threshold and did not have the possibility of achieving threshold levels for any payout. The Nomor executives were granted time vested restricted stock units in 2020 and Terminix will evaluate establishing new performance targets to incentivize the Nomor executives. A summary of performance share activity under the Omnibus Incentive Plan as of December 31, 2020, and changes during the year then ended is presented below: Weighted Avg. Performance Grant Date Shares Fair Value Total outstanding, December 31, 2019 187,746 $ 50.13 Granted to executives 134,094 $ 36.81 Forfeited ( 171,896 ) $ 49.77 Total outstanding, December 31, 2020 149,944 $ 37.77 Stock-based compensation expense During the years ended December 31, 2020, 2019 and 2018, we recognized stock-based compensation expense of $ 16 million ($ 12 million, net of tax), $ 14 million ($ 10 million, net of tax) and $ 13 million ($ 9 million, net of tax), respectively. These charges are recorded within Selling and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income (Loss) and, in the year ended December 31, 2018, included $ 3 million of stock-based compensation expense related to retention awards granted to employees instrumental to the spin-off. For the years ended December 31, 2020, 2019 and 2018, stock-based compensation expense recognized related to employees of ServiceMaster Brands and Frontdoor is included within Net earnings from discontinued operations on the Consolidated Statements of Operations and Comprehensive Income (Loss). As of December 31, 2020, there was $ 33 million of total unrecognized compensation costs related to non-vested stock options, RSUs and PSUs granted under the MSIP and Omnibus Incentive Plan. These remaining costs are expected to be recognized over a weighted-average period of 1.75 years. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Measurements [Abstract] | |
Fair Value Measurements | Note 17. Fair Value Measurements The period-end carrying amounts of cash and cash equivalents, receivables, restricted cash, accounts payable and accrued liabilities approximate fair value because of the short maturity of these instruments. The period-end carrying amounts of long-term notes receivable approximate fair value as the effective interest rates for these instruments are comparable to period-end market rates. The period-end carrying amounts of marketable securities also approximate fair value, with unrealized gains and losses reported net of tax as a component of accumulated other comprehensive income on the Consolidated Statements of Financial Position, or, for certain unrealized losses, reported in interest and net investment income in the Consolidated Statements of Operations and Comprehensive Income (Loss) if the decline in value is other than temporary. The carrying amount of total debt was $ 920 million and $ 1,735 million and the estimated fair value was $ 989 mil lion and $ 1,839 million as of December 31, 2020 and December 31, 2019, respectively. The fair value of our debt is estimated based on available market prices for the same or similar instruments which are considered significant other observable inputs (Level 2) within the fair value hierarchy. The fair values presented reflect the amounts that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The fair value estimates presented in this report are based on information available to us as of December 31, 2020 and 2019. We have estimated the fair value of our financial instruments measured at fair value on a recurring basis using the market and income approaches. For investments in marketable securities, deferred compensation trust assets and derivative contracts, which are carried at their fair values, our fair value estimates incorporate quoted market prices, other observable inputs (for example, forward interest rates) and unobservable inputs (for example, forward commodity prices) at the balance sheet date. Interest rate swap contracts are valued using forward interest rate curves obtained from third-party market data providers. The fair value of each contract is the sum of the expected future settlements between the contract counterparties, discounted to present value. The expected future settlements are determined by comparing the contract interest rate to the expected forward interest rate as of each settlement date and applying the difference between the two rates to the notional amount of debt in the interest rate swap contracts. Fuel swap contracts are valued using forward fuel price curves obtained from third-party market data providers. The fair value of each contract is the sum of the expected future settlements between the contract counterparties, discounted to present value. The expected future settlements are determined by comparing the contract fuel price to the expected forward fuel price as of each settlement date and applying the difference between the contract and expected prices to the notional gallons in the fuel swap contracts. We regularly review the forward price curves obtained from third-party market data providers and related changes in fair value for reasonableness utilizing information available to us from other published sources. As of December 31, 2020, we had fuel swap contracts to pay fixed prices for fuel with an aggregate notional amount of $ 23 million, maturing through 2021. Under the terms of our fuel swap contracts, we are required to post collateral in the event that the fair value of the contracts exceeds a certain agreed upon liability level and in other circumstances required by the counterparty. As of December 31, 2020, we had posted $ 2 million in letters of credit as collateral under our fuel hedging program, which were issued under the Revolving Credit Facility. The amount expected to be reclassified into earnings during the next 12 months includes unrealized gains and losses related to open fuel hedges and interest rate swaps. Specifically, as the underlying forecasted transactions occur during the next 12 months, the hedging gains and losses in accumulated other comprehensive income expected to be recognized in earnings is a loss of $ 6 million, net of tax, as of December 31, 2020 . The amounts that are ultimately reclassified into earnings will be based on actual fuel prices and interest rates at the time the positions are settled and may differ materially from the amount noted above. Effective March 3, 2020, we entered into a fixed-to-fixed cross-currency interest rate swap to hedge foreign currency risk associated with the fixed-rate Swedish krona denominated intercompany debt at Nomor. The five year interest rate swap matures March 31, 2025 and has a notional amount of 725 million Swedish krona, or approximately $ 74 million, and swaps interest payments of 3.5 percent Swedish krona for interest receipts of 4.147 percent U.S. dollar. This hedge was entered into to mitigate foreign currency risk inherent in Swedish krona denominated debt and is not for speculative trading purposes. This contract has been designated as a cash flow hedge of a fixed rate borrowing and is recorded at fair value. We also entered into a cross-currency swap agreement to hedge a portion of our net investment in Nomor against future volatility in the exchange rates between the Swedish krona and the U.S. dollar. The five year cross-currency swap has a fixed notional amount of 1.275 billion Swedish krona, or approximately $ 131 million, at an annual rate of zero percent and a maturity date of March 31, 2025 . At inception, the cross-currency swap was designated as a net investment hedge and is recorded at fair value. Changes in the fair value of these contracts are recorded within Other comprehensive (loss) income on the Condensed Consolidated Statements of Financial Position. Interest accruals and coupon payments are recognized directly in interest expense, thus reflecting a Swedish krona fixed rate. Upon discontinuation of the net investment hedge, the changes in spot value and any amounts excluded from the assessment of hedge effectiveness that have not been recognized in earnings will remain within CTA until the hedged net investment is sold, diluted, or liquidated. We have not changed our valuation techniques for measuring the fair value of any financial assets and liabilities during the year. Transfers between levels, if any, are recognized at the end of the reporting period. There were no significant transfers between levels during each of the years ended December 31, 2020 and 2019. The effective portion of the gain or loss on derivative instruments designated and qualifying as cash flow hedging instruments is recorded in accumulated other comprehensive income. These amounts are reclassified into earnings in the same period or periods during which the hedged forecasted debt interest settlement or the fuel settlement affects earnings. See Note 13 to the consolidated financial statements for the effective portion of the gain or loss on derivative instruments recorded in accumulated other comprehensive income and for the amounts reclassified out of accumulated other comprehensive income and into earnings. The amount expected to be reclassified into earnings during the next 12 months includes unrealized gains and losses related to open fuel hedges and interest rate swaps. Specifically, as the underlying forecasted transactions occur during the next 12 months, the hedging gains and losses in accumulated other comprehensive income expected to be recognized in earnings is a loss of $ 6 million, net of tax, as of December 31, 2020 . The amounts that are ultimately reclassified into earnings will be based on actual fuel prices and interest rates at the time the positions are settled and may differ materially from the amount noted above. The carrying amount and estimated fair value of our financial instruments that are recorded at fair value on a recurring basis for the periods presented are as follows: Estimated Fair Value Measurements Quoted Significant Prices In Other Significant Active Observable Unobservable Statement of Financial Carrying Markets Inputs Inputs (In millions) Position Location Value (Level 1) (Level 2) (Level 3) As of December 31, 2020: Financial Assets: Deferred compensation trust assets Long-term marketable securities $ 14 $ 14 $ — $ — Fuel swap contracts Prepaid expenses and other assets and Other assets 3 — — 3 Total financial assets $ 18 $ 14 $ — $ 3 Financial Liabilities: Cross-currency interest rate swap Other long-term obligations $ 15 $ — $ 15 $ — Net investment hedge Other long-term obligations 23 — 23 — Interest rate swap contracts Accrued liabilities—Other and Other long-term obligations 34 — 34 — Total financial liabilities $ 72 $ — $ 72 $ — As of December 31, 2019: Financial Assets: Deferred compensation trust assets Long-term marketable securities $ 13 $ 13 $ — $ — Fuel swap contracts Prepaid expenses and other assets and Other assets 1 — — 1 Interest rate swap contracts Other assets 5 — 5 — Total financial assets $ 19 $ 13 $ 5 $ 1 Financial Liabilities: Interest rate swap contracts Other accrued liabilities and Other long-term obligations 1 — 1 — Total financial liabilities $ 1 $ — $ 1 $ — A reconciliation of the beginning and ending fair values of financial instruments valued using significant unobservable inputs (Level 3) on a recurring basis is presented as follows: Fuel Swap Contract Assets (In millions) (Liabilities) Location of Loss included in Earnings Balance as of December 31, 2018 $ ( 4 ) Total (losses) gains (realized and unrealized) Included in earnings — Cost of services rendered and products sold Included in other comprehensive income 5 Settlements — Balance as of December 31, 2019 $ 1 Total gains (losses) (realized and unrealized) Included in earnings $ 4 Cost of services rendered and products sold Included in other comprehensive income 2 Settlements ( 4 ) Balance as of December 31, 2020 $ 3 The following tables present information relating to the significant unobservable inputs of our Level 3 financial instruments: Fair Value Valuation Weighted (in millions) Technique Unobservable Input Range Average As of December 31, 2020: Fuel swap contracts $ 3 Discounted Cash Flows Forward Unleaded Price per Gallon (1) $ 2.20 - $ 2.58 $ 2.44 As of December 31, 2019: Fuel swap contracts $ 1 Discounted Cash Flows Forward Unleaded Price per Gallon (1) $ 2.37 - $ 2.80 $ 2.61 ___________________________________ (1) Forward prices per gallon were derived from third-party market data providers. A decrease in the forward price would result in a reduction in the fair value asset of the fuel swap contracts. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 18. Earnings Per Share Basic earnings per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding. Diluted earnings per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, increased to include the number of shares of common stock that would have been outstanding had potential dilutive shares of common stock been issued. The dilutive effect of stock options, RSUs and performance shares are reflected in diluted net income (loss) per share by applying the treasury stock method. A reconciliation of the amounts included in the computation of basic earnings (loss) per share from continuing operations and diluted earnings (loss) per share from continuing operations is as follows: Year Ended December 31, (In millions, except per share data) 2020 2019 2018 Income (Loss) from Continuing Operations $ 20 $ 60 $ ( 227 ) Weighted-average common shares outstanding 132.7 135.8 135.5 Effect of dilutive securities: RSUs 0.2 0.1 — Stock options (1) 0.1 0.3 — Weighted-average common shares outstanding - assuming dilution 133.0 136.2 135.5 Basic earnings (loss) per share from continuing operations $ 0.15 $ 0.44 $ ( 1.68 ) Diluted earnings (loss) per share from continuing operations $ 0.15 $ 0.44 $ ( 1.68 ) ___________________________________ (1) Options to purchase 0.8 million and 0.5 million shares for the years ended December 31, 2020 and 2019, respectively, were not included in the diluted earnings per share calculation because their effect would have been antidilutive. For the year ended December 31, 2018, weighted average potentially dilutive shares from RSUs of 0.2 million and weighted average potentially dilutive shares from stock options of 0.4 million with a weighted average exercise price of $ 29.34 were excluded from the dilutive earnings (loss) per share calculation due to the net loss. |
Significant Accounting Polici_2
Significant Accounting Policies (Policy) | 12 Months Ended |
Dec. 31, 2020 | |
Significant Accounting Policies [Abstract] | |
Consolidation | Consolidation The consolidated financial statements include all of our wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Use Of Estimates | Use of Estimates The preparation of the consolidated financial statements requires management to make certain estimates and assumptions required under GAAP which may differ from actual results. The more significant areas requiring the use of management estimates relate to the allowance for uncollectible receivables; accruals for self-insured retention limits related to medical, workers’ compensation, auto and general liability insurance claims; accruals for Litigated Claims and Non-Litigated Claims; the possible outcome of outstanding litigation; accruals for income tax liabilities as well as deferred tax accounts; the deferral and amortization of customer acquisition costs; stock-based compensation; the valuation of acquisitions; useful lives for depreciation and amortization expense; the valuation of marketable securities; and the valuation of tangible and intangible assets. In 2019, we changed our methodology for estimating exposure for damage claims liabilities. See Note 9 to the consolidated financial statements for further discussion of this change. There were no changes in any other significant areas that require estimates or in the underlying methodologies used in determining the amounts of these associated estimates. The allowance for uncollectible receivables is developed based on several factors including overall customer credit quality, historical write-off experience and specific account analyses that project the ultimate collectability of the outstanding balances. As such, these factors may change over time causing the allowance level to vary. We carry insurance policies on insurable risks at levels which we believe to be appropriate, including workers’ compensation, auto and general liability risks. We purchase insurance policies from third-party insurance carriers, which typically incorporate significant deductibles or self-insured retentions. We are responsible for all claims that fall below the retention limits. In determining our accrual for self-insured claims, we use historical claims experience to establish both the current year accrual and the underlying provision for future losses. This actuarially determined provision and related accrual include known claims, as well as incurred but not reported claims. We adjust the estimate of accrued self-insured claims when required to reflect changes based on factors such as changes in health care costs, accident frequency and claim severity. We seek to reduce the potential amount of loss arising from self-insured claims by insuring certain levels of risk. While insurance agreements are designed to limit our losses from large exposure and permit recovery of a portion of direct unpaid losses, insurance does not relieve us of ultimate liability. Accordingly, the accruals for insured claims represent our total unpaid gross losses. Insurance recoverables, which are reported within Prepaid expenses and other assets and Other assets, relate to estimated insurance recoveries on the insured claims reserves. Termite damage claim accruals are recorded based on both the historical rates of claims incurred within a contract term and the cost per claim. Current activity could differ causing a change in estimates. We have certain liabilities with respect to existing or potential claims, lawsuits, and other proceedings. We accrue for these liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated. Any resulting adjustments, which could be material, are recorded in the period the adjustments are identified. We record deferred income tax balances based on the net tax effects of temporary differences between the carrying value of assets and liabilities for financial reporting purposes and income tax purposes. We record deferred tax items based on the estimated value of the tax basis. We adjust tax estimates when required to reflect changes based on factors such as changes in tax laws, relevant court decisions, results of tax authority reviews and statutes of limitations. We record a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. We recognize potential interest and penalties related to our uncertain tax positions in Provision (benefit) for income taxes on the Consolidated Statements of Operations and Comprehensive Income (Loss). |
Revenue | Revenue Residential pest management services Residential pest management services can be for one-time or recurring services. Revenues from residential pest management services are recognized at the agreed-upon contractual amount over time as the services are provided, most of which are started and completed within one day, as the customer simultaneously receives and consumes the benefits of the services as they are performed. Upon completion of service, a receivable is recorded related to this revenue as we have an unconditional right to invoice and receive payment. Payments are typically received shortly after services have been rendered. Commercial pest management services Commercial pest management services are largely for recurring services. Revenues from commercial pest management services are recognized at the agreed-upon contractual amount over time as the services are provided, most of which are started and completed within one day, as the customer simultaneously receives and consumes the benefits of the services as they are performed. Upon completion of service, a receivable is recorded related to this revenue as we have an unconditional right to invoice and receive payment. Payments are typically received shortly after services have been rendered. Termite and home services We eradicate termites through the use of baiting systems and non-baiting methods (e.g., fumigation or liquid treatments). Termite services using liquid and baiting systems are sold through renewable contracts. We also perform other related services, including wildlife exclusion, crawl space encapsulation and attic insulation, which may be one-time or renewable services. Revenues for termite services are recognized at the agreed-upon contractual amount upon the completion of the service. All termite services are generally started and completed within one day. Upon completion of the service, a receivable is recorded related to this revenue as we have an unconditional right to invoice and receive payment. Payments are typically received shortly after services have been rendered. Most termite services can be renewed after the initial year. Revenue on renewal contracts is recognized upon completion of an annual inspection and receipt of payment from the customer which evidences the extension of the contract into a renewal period. Advanced renewal payments generate a contract liability and are deferred until the related renewal period. Termite inspection and protection contracts are frequently sold through annual contracts. For these contracts, we have a stand ready obligation of which the customer receives and consumes the benefits over the annual period. Associated service costs are expensed as incurred. We measure progress toward satisfaction of our stand ready obligation over time using costs incurred as the measure of progress under the input method, which results in straight-line recognition of revenue. Payments are received at the commencement of the contract, which can generate a contract liability, or in installments over the contract period. Sales of products and other Product revenues are generated from selling products to distributors and franchisees. Revenues from product sales are generally recognized once control of the products transfers to the customer. A receivable is recorded related to these sales as we have an unconditional right to invoice and receive payment. Payments are typically received shortly after a customer is invoiced. Costs to obtain a contract with a customer We capitalize the incremental costs of obtaining a contract with a customer, primarily commissions, and recognize the expense on a straight-line basis over the expected customer relationship period. As of December 31, 2020 and 2019, we had long-term deferred customer acquisition costs of $ 98 million and $ 94 million, respectively. In the years ended December 31, 2020 and 2019, the amount of amortization was $ 97 million and $ 84 million, respectively. There were no impairment losses in relation to costs capitalized. Contract balances Timing of revenue recognition may differ from the timing of invoicing customers. Contracts with customers are generally for a period of one year or less and are generally renewable. We record a receivable related to revenue recognized on services once we have an unconditional right to invoice and receive payment in the future related to the services provided. All accounts receivables are recorded within Receivables, less allowances, on the Consolidated Statements of Financial Position. The current portion of Notes receivable, which represent amounts financed for customers through our financing subsidiary, are included within Receivables, less allowances, on the Consolidated Statements of Financial Position and totaled $ 27 million and $ 38 million as of December 31, 2020 and 2019, respectively. |
Advertising | Advertising Advertising costs are expensed when the advertising occurs. Advertising expense for the years ended December 31, 2020, 2019 and 2018 was $ 91 million, $ 90 million and $ 82 million, respectively. |
Inventory | Inventory Inventories are recorded at the lower of cost (primarily on a weighted-average cost basis) or net realizable value. Our inventory primarily consists of finished goods to be used on the customers’ premises or sold to franchisees. |
Property And Equipment, Intangible Assets And Goodwill | Property and Equipment, Intangible Assets and Goodwill Property and equipment consist of the following: Estimated As of December 31, Useful Lives (In millions) 2020 2019 (Years) Land $ 5 $ 5 N/A Buildings and improvements 51 53 10 ‒ 40 Technology and communications 172 175 3 ‒ 7 Machinery, production equipment and vehicles 287 271 3 ‒ 9 Office equipment, furniture and fixtures 23 28 5 ‒ 7 538 532 Less accumulated depreciation ( 356 ) ( 328 ) Net property and equipment $ 182 $ 204 Depreciation of property and equipment, including depreciation of assets held under finance leases was $ 73 million, $ 71 million and $ 69 million for the years ended December 31, 2020, 2019 and 2018, respectively. No impairment charges were recorded in the years ended December 31, 2020, 2019 or 2018. Fixed assets and intangible assets with finite lives are depreciated and amortized on a straight-line basis over their estimated useful lives. These lives are based on our previous experience for similar assets, potential market obsolescence and other industry and business data. As required by accounting standards for the impairment or disposal of long-lived assets, fixed assets and finite-lived intangible assets are tested for recoverability whenever events or changes in circumstances indicate their carrying amounts may not be recoverable. If the carrying value is no longer recoverable based upon the undiscounted future cash flows of the asset, an impairment loss would be recognized equal to the difference between the carrying amount and the fair value of the asset. Changes in the estimated useful lives or in the asset values could cause us to adjust its book value or future expense accordingly. As required under accounting standards for goodwill and other intangibles, goodwill is not subject to amortization, and intangible assets with indefinite useful lives are not amortized until their useful lives are determined to no longer be indefinite. Goodwill and intangible assets that are not subject to amortization are subject to assessment for impairment by applying a fair-value based or qualitative test on an annual basis or more frequently if circumstances indicate a potential impairment. Our goodwill resides in multiple reporting units and primarily consists of expected synergies in addition to the expansion of our geographic presence. Goodwill and indefinite-lived intangible assets, primarily trade names, are assessed annually for impairment on the first day of the fourth quarter or earlier upon the occurrence of certain events or substantive changes in circumstances. Our 2020, 2019 and 2018 annual impairment analyses, which were performed as of October 1 of each year, did no t result in any goodwill or trade name impairments. See Note 4 to the consolidated financial statements for our goodwill and intangible assets balances. |
Leases | Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, “ Leases (Topic 842) ” (codified within FASB Accounting Standards Codification (“ASC”) 842) which is the final standard on accounting for leases. We adopted the new lease guidance effective January 1, 2019, and elected certain of the available practical expedients upon adoption. See Note 12 for further discussion of our lease assets and liabilities. We determine if an arrangement is a lease at inception. Operating leases are included in Operating lease right-of-use assets, Current portion of lease liability and Long-term lease liability on the Consolidated Statements of Financial Position. Finance leases are included in Property and equipment, net; Current portion of long-term debt and Long-term debt on the Consolidated Statements of Financial Position. We lease a variety of facilities, principally in the U.S. , for branch and service center operations and for office, storage and data processing space. Most of the property leases provide that we pay taxes, insurance and maintenance applicable to the leased premises. These leases are classified as operating leases. Our facilities leases have remaining lease terms of less than one year to 22 years, some of which may include options to extend the leases for up to 15 years, and some of which may include options to terminate the leases within one year . These lease agreements contain lease and non-lease components. Non-lease components include items such as common area maintenance. For facility leases, we account for the lease and non-lease components as a single lease component. Additionally, our Fleet Agreement allows us to obtain fleet vehicles through a leasing program. These leases are classified as finance leases. Our vehicle leases have remaining lease terms of less than one year to seven years . For vehicle leases, we account for the lease and non-lease components separately. Operating lease right-of-use (“ROU”) assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments, including fixed non-lease components, over the lease term at commencement date. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Generally, the lease term is the minimum noncancelable period of the lease, or the lease term inclusive of reasonably certain renewal periods. Lease expense for minimum lease payments and fixed non-lease components is recognized on a straight-line basis over the lease term. As the rates implicit in our leases are not readily determinable, we use a collateralized incremental borrowing rate based on the information available at the lease commencement date in determining the present value of future payments. We use the portfolio approach and group leases into categories by lease term length, applying the corresponding incremental borrowing rates to these categories of leases. |
Restricted Cash | Restricted Cash Restricted cash consists of cash held in trust as collateral under our automobile, general liability and workers’ compensation insurance program. |
Financial Instruments And Credit Risk | Financial Instruments and Credit Risk We use derivative financial instruments to manage risks associated with changes in fuel prices and interest rates. We have entered into specific financial arrangements in the normal course of business to manage certain market risks, with a policy of matching positions and limiting the terms of contracts to relatively short durations. The effect of derivative financial instrument transactions could have a material impact on our financial statements. We do not hold or issue derivative financial instruments for trading or speculative purposes. In designating derivative financial instruments as hedging instruments under accounting standards, we formally document the relationship between the hedging instrument and the hedged item, as well as the risk management objective and strategy for the use of the hedging instrument. This documentation includes linking the derivatives to forecasted transactions. We assess at the time a derivative contract is entered into, and at least quarterly thereafter, whether the derivative item is effective in offsetting the projected changes in cash flows of the associated forecasted transactions. We have historically hedged a significant portion of our annual fuel consumption. We have also historically hedged the interest payments on a portion of our variable rate debt through the use of interest rate swap agreements. These derivatives are classified as cash flow hedges, and, as such, the hedging instruments are recorded on the Consolidated Statements of Financial Position as either an asset or liability at fair value, with the effective portion of changes in the fair value attributable to the hedged risks recorded in accumulated other comprehensive income. Cash flows related to our derivatives are classified as operating activities in the Consolidated Statements of Cash Flows. In March 2020, we entered into a cross-currency swap agreement to hedge our investment in Nomor against future volatility in the exchange rates between the Swedish krona and the U.S. dollar. We designated this cross-currency swap as a qualifying hedging instrument and account for it as a net investment hedge. Under this method, for each reporting period, the change in fair value of the cross-currency swap is initially recognized in Accumulated other comprehensive income. We also entered into a cross-currency swap to manage the related foreign currency exposure from an intercompany loan denominated in Swedish krona. We designated this cross-currency swap as a qualifying hedging instrument and account for it as a cash flow hedge. Gains and losses from the change in fair value of the cross currency swap are initially recognized in Accumulated other comprehensive income and reclassified to earnings to offset the foreign exchange impact created by the intercompany loan. Financial instruments, which potentially subject us to financial and credit risk, consist principally of receivables. Most of our receivables and notes receivable have little concentration of credit risk due to the large number of customers with relatively small balances and their dispersion across geographical areas. We maintain an allowance for losses based upon the expected collectability of receivables, adjusted for the impact of economic factors, such as unemployment, are expected to have on the collectability of receivables, if necessary. We also hold long-term marketable securities as part of our deferred compensation plan, which are accounted for at fair value with adjustments recognized in Interest and net investment income in the Consolidated Statements of Operations and Comprehensive Income (Loss) in the period incurred. See Note 17 to the consolidated financial statements for information relating to the fair value of financial instruments. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense for stock options is estimated at the grant date based on an award’s fair value as calculated by the Black-Scholes option-pricing model and is recognized as expense over the requisite service period. The Black-Scholes model requires various highly judgmental assumptions including expected volatility and option life. If any of the assumptions used in the Black-Scholes model change significantly, stock-based compensation expense for future grants may differ materially from that recorded in the current period related to options granted to date. In addition, we estimate the expected forfeiture rate and only recognize expense for those shares expected to vest. We estimate the forfeiture rate based on historical experience. To the extent the actual forfeiture rate is different from the estimate, stock-based compensation expense is adjusted accordingly. See Note 16 to the consolidated financial statements for more details. |
Income Taxes | Income Taxes We and our subsidiaries file consolidated U.S. federal income tax returns. State and local returns are filed both on a separate company basis and on a combined unitary basis with the Company. Current and deferred income taxes are provided for on a separate company basis. We account for income taxes using an asset and liability approach for the expected future tax consequences of events that have been recognized in our financial statements or tax returns. Deferred income taxes are provided to reflect the differences between the tax bases of assets and liabilities and their reported amounts in the financial statements. Valuation allowances are established when necessary to reduce deferred income tax assets to the amounts expected to be realized. We record a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in our tax return. We recognize potential interest income, interest expense and penalties related to uncertain tax positions in income tax expense. |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding. Diluted earnings per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, increased to include the number of shares of common stock that would have been outstanding had potential dilutive shares of common stock been issued. The dilutive effect of stock options, restricted stock units (“RSUs”) and performance shares are reflected in diluted earnings per share by applying the treasury stock method. See Note 18 to the consolidated financial statements for more details. |
Acquisitions | Acquisitions Acquisitions have been accounted for as business combinations using the acquisition method in accordance with ASC 805, “Business Combinations,” and, accordingly, the purchase price has been allocated to the acquired assets and liabilities assumed at their estimated fair values as of the acquisition dates. The fair value of customer relationships is identified using an income approach. The fair value of trade names acquired is identified using the relief from royalty method. Determining the fair value of intangible assets required the use of significant judgment, including the discount rates and the long-term plans about future revenues and expenses, capital expenditures and changes in working capital, which are dependent on information provided by the company acquired. After the purchase price is allocated, goodwill is recorded to the extent the total consideration paid for the acquisition exceeds the sum of the fair value of all assets and liabilities acquired. Asset acquisitions have been accounted for under ASU 2017-01, “Business Combinations (Topic 805) – Clarifying the Definition of a Business.” Determining the useful life of an intangible asset also requires judgment as different intangible assets will have different useful lives. The results of operations of the acquired businesses have been included in the consolidated financial statements since their dates of acquisition. |
Reportable Segment | Reportable Segment We have one reportable segment, our pest management and termite business. Our reportable segment is comprised of multiple operating segments, including Terminix and individual international subsidiaries. Each operating segment’s results are regularly reviewed by the chief executive officer, the chief operating decision maker. All operating segments have been aggregated into one reportable segment based on their similar economic characteristics, nature of services provided, type of customers and service distribution methods. |
Newly Issued Accounting Standards | Newly Issued Accounting Standards Adoption of New Accounting Standards In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, “ Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments .” This ASU requires entities to report “expected” credit losses on financial instruments and other commitments to extend credit rather than the current “incurred loss” model. These expected credit losses for financial assets held at the reporting date are to be based on historical experience, current conditions and reasonable and supportable forecasts. This ASU also requires enhanced disclosures relating to significant estimates and judgments used in estimating credit losses, as well as the credit quality. We adopted this ASU on January 1, 2020, and this adoption did not have a material impact on our financial condition or the results of our operations. In August 2017, the FASB issued ASU 2017-12, “ Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities .” The ASU simplifies certain aspects of hedge accounting and improves disclosures of hedging arrangements through the elimination of the requirement to separately measure and report hedge ineffectiveness. The ASU generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item in order to align financial reporting of hedging relationships with economic results. Entities must apply the amendments to cash flow and net investment hedge relationships that exist on the date of adoption using a modified retrospective approach. The presentation and disclosure requirements must be applied prospectively. We adopted this ASU on January 1, 2019, and it did not have a significant impact on our financial condition or the results of our operations. In July 2018, the FASB issued ASU 2018-09, “ Codification Improvements. ” This ASU does not prescribe any new accounting guidance, but instead makes minor improvements and clarifications of several different FASB Accounting Standards Codification areas based on comments and suggestions made by various stakeholders. Certain updates are applicable immediately while others provide for a transition period to adopt as part of the next fiscal year beginning after December 15, 2018. We adopted this ASU on January 1, 2019, and it did not have a significant impact on our financial condition or the results of our operations. In August 2018, the FASB issued ASU 2018-15, “ Intangibles—Goodwill and Other—Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract .” This ASU requires implementation costs incurred by customers in cloud computing arrangements (i.e., hosting arrangements) to be capitalized under the same premises of authoritative guidance for internal-use software, and deferred over the noncancelable term of the cloud computing arrangements plus any optional renewal periods that are reasonably certain to be exercised by the customer or for which the exercise is controlled by the service provider. The amendments in ASU 2018-15 are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. We early adopted this ASU on January 1, 2019, resulting in the capitalization of certain development costs of approximately $ 13 million and $ 14 million in December 31, 2020 and 2019, respectively, primarily related to our implementation of a new customer experience platform to replace legacy operating systems. In August 2018, the FASB issued ASU 2018-13, “ Fair Value Measurement .” Under ASU 2018-13, entities are required to disclose the amount of total gains or losses for the period recognized in other comprehensive income that is attributable to fair value changes in assets and liabilities held as of the balance sheet date and categorized within Level 3 of the fair value hierarchy. Additionally, the ASU requires the disclosure of the range and weighted average used to develop significant unobservable inputs and how the weighted average was calculated for fair value measurements categorized within Level 3 of the fair value hierarchy. We adopted this ASU on January 1, 2020, and this adoption had no impact to our disclosures. See Note 17 for further discussion of our Level 3 investments. In October 2019, the FASB issued ASU No. 2018-16, “ Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes ,” which amends ASC 815, Derivatives and Hedging. This ASU adds the OIS rate based on SOFR to the list of permissible benchmark rates for hedge accounting purposes. We adopted the ASU on January 1, 2019, and it did not have a significant impact on our financial condition or the results of our operations. In March 2020, the FASB issued ASU 2020-03, “ Codification Improvements .” This ASU does not prescribe any new accounting guidance, but instead makes minor improvements and clarifications of several different FASB Accounting Standards Codification areas based on comments and suggestions made by various stakeholders. Certain updates are applicable immediately while others provide for a transition period to adopt as part of the next fiscal year beginning after December 15, 2020. We adopted the updates, as applicable, in 2020, and this adoption did not have a material impact on our financial condition or the results of our operations. In March 2020, the FASB issued ASU 2020-04, “ Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting .” The ASU provides optional guidance to ease the potential burden in accounting for reference rate reform on financial reporting in response to the risk of cessation of the London Interbank Offered Rate (LIBOR). This amendment provides for optional expedients and exceptions for applying generally accepted accounting principles to contracts and hedging relationships that are affected by LIBOR and other reference rates. The ASU generally allows for a hedge accounting to continue if the hedge was highly effective or met other standards prior to reference rate reform. Entities are permitted to apply the amendments to all contracts, cash flow and net investment hedge relationships that exist as of March 12, 2020. The relief provided in this ASU is only available for a limited time, generally through December 31, 2022. Our debt agreement and interest rate swap that utilize LIBOR have not yet discontinued the use of LIBOR and, therefore, this ASU is not yet effective for us. To the extent our debt and interest rate swap arrangements change to another accepted rate, we will utilize the relief in this ASU to continue hedge accounting as we expect the remaining critical terms of our hedging relationship will still match. In November 2020, the SEC issued Rule 33-10890, “ Management’s Discussion and Analysis, Selected Financial Data, and Supplementary Financial Information .” This rule is effective for our Annual Report on Form 10-K for the year ended December 31, 2021, and can be early adopted in its entirety as of February 10, 2021. The rule modernized, simplified and enhanced financial statement disclosures required by Regulation S-K. We early adopted all the provisions in the rule as of February 10, 2021 in this Annual Report on Form 10-K, which primarily resulted in the removal of the contractual obligations table, elimination of duplicative disclosures of legal matters and the simplification of our risk factors. While permitted, we did not remove or simplify the Selected financial data, Quarterly operating results or certain discussions within Management’s Discussion and Analysis as we had not previously presented the ServiceMaster Brands Divestiture Group as discontinued operations or our results as one reportable segment for all relevant periods. Our adoptions of ASU 2016-01, “ Recognition and Measurement of Financial Assets and Financial Liabilities ” and ASU 2018-02, “ Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income ” on January 1, 2018 resulted in the following changes to our Consolidated Statements of Stockholders’ Equity previously reported: (In millions) Accumulated other comprehensive income Accumulated deficit As reported, December 31, 2017 $ 5 $ ( 895 ) Impact of adopting ASC 606 (Note 3) — 16 Impact of adopting ASU 2016-01 ( 2 ) 2 Impact of adopting ASU 2018-02 4 ( 4 ) As revised, January 1, 2018 $ 7 $ ( 881 ) Accounting Standards Issued But Not Yet Effective In December 2019, the FASB issued ASU No. 2019-12, “ Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ,” which simplifies the accounting for income taxes by removing certain exceptions. The ASU is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years, and early adoption is permitted. We will adopt this ASU effective January 1, 2021. The adoption of this ASU will not have a significant impact to our consolidated financial statements. We have reviewed all other recently issued, but not yet effective, accounting pronouncements and do not expect the future adoption of any such pronouncements will have a material impact on our financial condition or the results of our operations. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2020 | Dec. 31, 2020 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Schedule Of Property And Equipment | Estimated As of December 31, Useful Lives (In millions) 2020 2019 (Years) Land $ 5 $ 5 N/A Buildings and improvements 51 53 10 ‒ 40 Technology and communications 172 175 3 ‒ 7 Machinery, production equipment and vehicles 287 271 3 ‒ 9 Office equipment, furniture and fixtures 23 28 5 ‒ 7 538 532 Less accumulated depreciation ( 356 ) ( 328 ) Net property and equipment $ 182 $ 204 | |
Accounting Standards Update 2016-01 And 2018-02 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Adoption of ASUs, Changes To Statement Of Stockholder's Equity | (In millions) Accumulated other comprehensive income Accumulated deficit As reported, December 31, 2017 $ 5 $ ( 895 ) Impact of adopting ASC 606 (Note 3) — 16 Impact of adopting ASU 2016-01 ( 2 ) 2 Impact of adopting ASU 2018-02 4 ( 4 ) As revised, January 1, 2018 $ 7 $ ( 881 ) |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Disaggregation Of Revenue | Year ended December 31, (In millions) 2020 2019 2018 Major service line Residential Pest Management $ 706 $ 683 $ 633 Commercial Pest Management 443 420 339 Termite and Home Services 633 607 599 Sales of Products and Other 100 88 84 European Pest Management 79 21 — Total $ 1,961 $ 1,819 $ 1,655 |
Revenue By Geographic Area | Year ended December 31, (In millions) 2020 2019 2018 United States $ 1,851 $ 1,767 $ 1,624 International 111 52 31 Total $ 1,961 $ 1,819 $ 1,655 |
Movement In Deferred Revenue | (In millions) Deferred revenue Balance as of December 31, 2018 $ 91 Deferral of revenue (1) 146 Recognition of deferred revenue ( 129 ) Balance as of December 31, 2019 $ 107 Deferral of revenue 129 Recognition of deferred revenue ( 134 ) Balance as of December 31, 2020 $ 102 ___________________________________ (1) Includes approximately $ 15 million of deferred revenue related to our acquisition of Nomor. |
Impact of adopting ASC 606 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Compare Of Presentation Of Financial Statements Under ASC 606 To Under Prior Guidance | : Year ended December 31, 2018 (In millions) As reported Under Prior Revenue Recognition Guidance Revenue $ 1,655 $ 1,655 Cost of services rendered and products sold 944 944 Selling and administrative expenses 500 507 Provision for income taxes 14 12 Net (Loss) $ ( 41 ) $ ( 46 ) |
Goodwill And Intangible Assets
Goodwill And Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill And Intangible Assets [Abstract] | |
Schedule Of Goodwill Balances For Continuing Operations By Reportable Segment And For Other Operations And Headquarters | (In millions) Balance as of December 31, 2018 $ 1,781 Acquisitions 309 Purchase accounting adjustments ( 2 ) Impact of foreign exchange rates 7 Balance as of December 31, 2019 $ 2,096 Acquisitions 9 Purchase accounting adjustments 29 Impact of foreign exchange rates 12 Balance as of December 31, 2020 $ 2,146 |
Schedule Of Other Intangible Asset Balances For Continuing Operations | Weighted Average As of December 31, 2020 As of December 31, 2019 Remaining Accumulated Accumulated Useful Lives (In millions) (Years) Gross Amortization Net Gross Amortization Net Trade names, indefinite ꟷ $ 888 $ — $ 888 $ 888 $ — $ 888 Customer relationships (1) 19 650 ( 454 ) 196 659 ( 423 ) 236 Trade names, finite, and Other (2) 5 70 ( 43 ) 27 79 ( 34 ) 45 Total $ 1,608 $ ( 497 ) $ 1,111 $ 1,626 $ ( 457 ) $ 1,169 ___________________________________ (1) Includes purchase accounting adjustments subsequent to December 31, 2019, including $ 17 million related to our acquisition of Nomor and $ 7 million related to other acquisitions, offset by foreign currency fluctuations. (2) Includes purchase accounting adjustments subsequent to December 31, 2019, primarily related to our acquisition of Nomor, of $ 9 million. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Taxes [Abstract] | |
Components Of Income (Loss) From Continuing Operations Before Income Taxes | Year Ended December 31, (In millions) 2020 2019 2018 U.S. $ 46 $ 76 $ ( 212 ) Foreign ( 5 ) ( 12 ) ( 2 ) Income from Continuing Operations before Income Taxes $ 41 $ 64 $ ( 214 ) |
Reconciliation Of Effective Income Tax Rate | Year Ended December 31, 2020 2019 2018 Tax at U.S. federal statutory rate 21.0 % 21.0 % 21.0 % State and local income taxes, net of U.S. federal benefit (1) 15.1 2.6 ( 1.6 ) Foreign rate differences 2.1 0.6 ( 0.4 ) Tax credits ( 5.2 ) ( 3.5 ) 1.5 Realized (gain) loss on investment in frontdoor, inc. — ( 13.3 ) ( 24.5 ) Limitation on executive compensation 2.7 1.2 ( 0.4 ) Excess tax benefits from stock-based compensation 0.3 ( 1.8 ) 0.6 Mobile Bay Formosan termite settlement 20.3 — — Tax reserves ( 2.7 ) 0.3 ( 0.5 ) Other items 4.5 0.2 ( 0.4 ) U.S. Tax Reform rate change (2) — — ( 1.6 ) Effective rate 58.1 % 7.3 % ( 6.3 ) % ___________________________________ (1) The increase in State and local income taxes, net of U.S. federal benefit, was driven by the Mobile Bay Formosan termite settlement. (2) Deferred income taxes in the Consolidated Statements of Financial Position at December 31, 2018 were remeasured as a result of U.S. Tax Reform. |
Income Tax Expense From Continuing Operations | Year Ended December 31, (In millions ) 2020 2019 2018 Current: U.S. federal $ 6 $ ( 1 ) $ 16 Foreign 2 — — State and local 8 1 6 16 1 22 Deferred: U.S. federal 8 4 ( 10 ) Foreign ( 2 ) ( 1 ) 1 State and local 2 1 1 8 4 ( 8 ) Provision for income taxes $ 24 $ 5 $ 14 |
Deferred Tax Balances | As of December 31, (In millions) 2020 2019 Deferred tax (liabilities) assets: Intangible assets (1) $ ( 353 ) $ ( 498 ) Property and equipment ( 32 ) ( 29 ) Operating lease right-of-use assets ( 26 ) ( 30 ) Prepaid expenses and deferred customer acquisition costs ( 25 ) ( 25 ) Receivables allowances 6 6 Self-insured claims and related expenses 2 2 Accrued liabilities 36 35 Other long-term obligations 13 4 Current portion of lease liability and long-term lease liability 28 32 Net operating loss and tax credit carryforwards 13 16 Less valuation allowance ( 8 ) ( 12 ) Net Deferred taxes $ ( 346 ) $ ( 499 ) ___________________________________ (1) The deferred tax liability relates primarily to the difference in the tax versus book basis of intangible assets. As of December 31, 2020 and December 31, 2019, we had $ 335 million and $ 505 million, respectively, of deferred tax liability included in this net deferred tax liability, that would only be paid in certain circumstances, including liquidation or sale of various subsidiaries of the Company. |
Reconciliation Of Unrecognized Tax Benefits | Year Ended December 31, (In millions) 2020 2019 2018 Gross unrecognized tax benefits at beginning of period $ 14 $ 15 $ 14 Decrease in tax positions for prior years ( 2 ) — — Increases in tax positions for current year 4 1 3 Settlements — ( 1 ) — Lapse in statute of limitations ( 2 ) ( 1 ) ( 1 ) Gross unrecognized tax benefits at end of period $ 14 $ 14 $ 15 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Acquisitions [Abstract] | |
Preliminary Purchase Price Allocation | (In millions) Current assets (1) $ 11 Property and equipment 6 Goodwill 153 Identifiable intangible assets (2) 66 Current liabilities (3) ( 20 ) Long-term liabilities (4) ( 19 ) Total purchase price $ 198 ___________________________________ (1) Primarily trade receivables and net of approximately $ 9 million of cash acquired. (2) Primarily customer lists. (3) Primarily advanced collections from customers. (4) Includes $ 15 million of deferred tax liabilities recognized as a result of tax basis differences in intangible assets. |
Summary Of Pro Forma Consolidated Financial Information | (Unaudited) Year Ended (In millions, except per share data) 2019 2018 Consolidated revenue $ 1,854 $ 1,705 Consolidated net income (loss) $ 137 $ ( 42 ) Basic earnings (loss) per share $ 1.01 $ ( 0.31 ) Diluted earnings (loss) per share $ 1.00 $ ( 0.31 ) |
Schedule Of Supplemental Cash Flow Information Regarding Acquisitions | Year Ended December 31, (In millions) 2020 2019 2018 Assets acquired $ 43 $ 590 $ 280 Liabilities assumed — ( 56 ) ( 30 ) Net assets acquired (1) $ 43 $ 535 $ 251 Net cash paid $ 36 $ 497 $ 187 Seller financed debt 7 38 64 Purchase price $ 43 $ 535 $ 251 ___________________________________ (1) Includes approximately $ 21 million, and $ 15 million of deferred tax liabilities in the years ended December 31, 2019 and 2018, respectively, as a result of tax basis differences in intangible assets. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Discontinued Operations [Abstract] | |
Schedule Of Operating Results Of Discontinued Operations | Year Ended December 31, (In millions) 2020 2019 2018 Revenue $ 198 $ 258 $ 1,225 Cost of services rendered and products sold 93 110 630 Operating expenses (1) 56 58 343 Interest and net investment income — ( 1 ) ( 1 ) Income before income taxes 50 91 252 Provision for income taxes 12 22 66 Gain on sale, net of income taxes ( 494 ) — — Net earnings from discontinued operations $ 531 $ 69 $ 186 ___________________________________ (1) Includes $ 18 million of professional fees and other costs incurred in connection with the strategic evaluation and ultimate sale of the ServiceMaster Brands Divestiture Group in the year ended December 31, 2020, and Frontdoor spin-off related transaction costs of $ 35 million for the year ended December 31, 2018. |
Schedule Of Assets And Liabilities Of Discontinued Operations | (In millions) December 31, 2019 Assets of Discontinued Operations: Receivables, net $ 40 Inventories and other current assets 5 Current assets of discontinued operations 45 Property and equipment, net 8 Operating lease right-of-use assets 2 Goodwill 183 Intangible assets, net 622 Other long-term assets 19 Total Assets of Discontinued Operations $ 879 Liabilities of Discontinued Operations: Accounts payable $ 8 Accrued liabilities: Payroll and related expenses 5 Self-insured claims and related expenses — Accrued interest payable — Other 23 Deferred revenue 4 Current portion of lease liability 1 Current portion of long-term debt 1 Total Current Liabilities 42 Deferred taxes 1 Other long-term obligations 8 Long-term debt 2 Total Liabilities of Discontinued Operations $ 52 |
Schedule Of Cash Flows Of Discontinued Operations | Year Ended December 31, (In millions) 2020 2019 2018 Depreciation $ — $ 4 $ 11 Amortization $ 1 $ 4 $ 11 Cash paid for income taxes $ 372 — — Capital expenditures $ ( 2 ) $ ( 4 ) $ ( 20 ) |
Restructuring And Other Charg_2
Restructuring And Other Charges (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Restructuring And Other Charges [Abstract] | |
Schedule Of Restructuring Charges | Year Ended December 31, (In millions) 2020 2019 2018 Field Operations (1) $ 6 $ 5 $ 2 Headquarter operations (2) 9 5 6 Global Service Center relocation (3) — 1 8 Total restructuring and other charges $ 16 $ 12 $ 17 ___________________________________ (1) For the years ended December 31, 2020, 2019 and 2018, these charges included $ 6 million, $ 5 million and $ 2 million, respectively of lease termination and severance costs. For the year ended December 31, 2020, lease termination costs includes $3 million of impairment charges related to our former call center right of use assets and rent expense on leases we exited before the end of the lease term. Of this amount, $ 1 million was unpaid and accrued as of December 31, 2020. (2) For the year ended December 31, 2020, includes severance and charges to enhance capabilities and reduce costs in our corporate functions that provide administrative services to support operations and other costs to enhance capabilities and align functions after the sale of the ServiceMaster Brands Divestiture Group of $ 8 million and retention bonuses to employees key to effecting the sale of the ServiceMaster Brands Divestiture Group of $ 1 million. For the year ended December 31, 2019, these charges included $ 3 million of accelerated depreciation on systems we are replacing with the implementation of our customer experience platform, $ 1 million of professional fees and other costs to enhance capabilities and align corporate functions after the American Home Shield spin-off and $ 1 million of severance and other costs. For the year ended December 31, 2018, includes $ 3 million of severance and other costs and $ 4 million of costs to facilitate the American Home Shield spin-off that were not included in discontinued operations. Of this amount, $ 1 million was unpaid and accrued as of December 31, 2020. (3) For the year ended December 31, 2019, these charges included lease termination and other charges of $ 1 million. For the year ended December 31, 2018, these charges included $ 7 million of future rent and $ 1 million of professional and other fees. All amounts under these agreements have been paid as of December 31, 2020. |
Schedule Of Reconciliation Of The Beginning And Ending Balances Of Accrued Restructuring Charges | Accrued Restructuring (In millions) Charges Balance as of December 31, 2018 $ 7 Costs incurred 12 Costs paid or otherwise settled ( 18 ) Balance as of December 31, 2019 1 Costs incurred 16 Costs paid or otherwise settled ( 15 ) Balance as of December 31, 2020 $ 2 |
Commitments And Contingencies (
Commitments And Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accrued Self-Insured Claims, Net [Member] | |
Commitments and Contingencies [Line Items] | |
Schedule Of Reconciliation Of Beginning And Ending Accrued Claims | Accrued Self-insured (In millions) Claims, Net Balance as of December 31, 2018 $ 111 Provision for self-insured claims 36 Cash payments ( 35 ) Balance as of December 31, 2019 111 Provision for self-insured claims 44 Cash payments ( 29 ) Balance as of December 31, 2020 $ 126 |
Litigated Claims And Non-Litigated Claims [Member] | |
Commitments and Contingencies [Line Items] | |
Schedule Of Reconciliation Of Beginning And Ending Accrued Claims | Accrued Termite Damage (In millions) Claims Balance as of December 31, 2018 $ 28 Provision for termite damage claims (1) 95 Cash payments ( 44 ) Balance as of December 31, 2019 80 Provision for termite damage claims 54 Cash payments ( 62 ) Balance as of December 31, 2020 $ 72 ___________________________________ (1) Includes a change in estimate of $ 53 million, as described below. |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Long-Term Debt [Abstract] | |
Schedule Of Long-Term Debt | As of December 31, (In millions) 2020 2019 Senior secured term loan facility maturing in 2026 (1) 539 593 5.125 % notes maturing in 2024 (2) — 742 7.45 % notes maturing in 2027 (3) 169 167 7.25 % notes maturing in 2038 (3) 41 40 Vehicle finance leases (4) 95 99 Other (5) 77 94 Less current portion (6) ( 94 ) ( 69 ) Total long-term debt $ 826 $ 1,666 ___________________________________ (1) As of December 31, 2020 and 2019, presented net of $ 7 million and $ 6 million, respectively, in unamortized debt issuance costs and $ 1 million and $ 1 million, respectively, in unamortized original issue discount paid as described below under “––Term Loan Facility.” (2) The 5.125 % Notes were retired on November 16, 2020, resulting in a loss on extinguishment of debt of $ 19 million. As of December 31, 2019, presented net of $ 8 million in unamortized debt issuance costs related to the 2024 notes. (3) As of December 31, 2020 and 2019, presented net of $ 25 million and $ 28 million, respectively, in unamortized fair value adjustments related to purchase accounting, which increases the effective interest rate from the coupon rates shown above. (4) We have entered into the Fleet Agreement which, among other things, allows us to obtain fleet vehicles through a leasing program. All leases under the Fleet Agreement are finance leases for accounting purposes. The lease rental payments include an interest component calculated using a variable rate based on one-month LIBOR plus other contractual adjustments and a borrowing margin ranging from 1.41 % to 2.45 % . (5) As of December 31, 2020 and 2019, includes approximately $ 76 million and $ 88 million, respectively, of future payments in connection with acquisitions. (6) The current portion of long-term debt consists of deferred purchase price and earnout payments on acquisitions, including approximately $ 50 million due to the former owners of Copesan in 2021, and scheduled principal payments of long-term debt due within 12 months. |
Schedule of Interest Rate Swap Agreements | Weighted Notional Average Fixed (In millions) Amount Rate (1) Interest rate swap agreements in effect as of December 31, 2018 $ 650 1.493 % Terminated ( 650 ) Entered into effect 550 1.615 % Interest rate swap agreements in effect as of December 31, 2019 550 1.615 % Terminated ( 4 ) Entered into effect — Interest rate swap agreements in effect as of December 31, 2020 $ 546 1.615 % ___________________________________ (1) Before the application of the applicable borrowing margin. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Components Of Lease Expense | Year ended December 31, (In millions) 2020 2019 Finance lease cost Depreciation of finance lease ROU assets $ 39 $ 35 Interest on finance lease liabilities 3 5 Operating lease cost 25 26 Variable lease cost 2 3 Sublease income ( 3 ) ( 2 ) Total lease cost $ 66 $ 67 |
Supplemental Cash Flow Information And Other Information For Leases | Year ended December 31, (In millions) 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 27 $ 24 Operating cash flows for finance leases $ 3 $ 5 Financing cash flows for finance leases $ 38 $ 34 ROU assets obtained in exchange for lease obligations: Operating leases $ 4 $ 12 Finance leases $ 36 $ 43 Weighted Average Remaining Lease Term (in years): Operating leases 10.52 10.58 Finance leases 3.44 3.34 Weighted Average Discount Rate: Operating leases 5.30 % 5.55 % Finance leases 4.86 % 4.13 % |
Future Minimum Lease Payments Under Non-Cancellable Leases | (In millions) Operating Leases (1) Finance Leases Year ended December 31, 2021 $ 23 $ 36 2022 20 26 2023 15 19 2024 12 11 2025 10 6 Thereafter 72 3 Total future minimum lease payments 152 100 Less imputed interest ( 39 ) ( 5 ) Total $ 113 $ 95 ___________________________________ (1) Each year through 2033 is presented net of approximately $ 3 million of projected annual sublease income from ServiceMaster Brands and Frontdoor for their subleases of our headquarters. Sublease income of approximately $ 3 million, $ 2 million and $ 1 million was recognized within Selling and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, 2020, 2019 and 2018, respectively. |
Comprehensive Income (Loss) (Ta
Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Comprehensive Income (Loss) [Abstract] | |
Summary Of The Activity In Other Comprehensive Income (Loss), Net Of The Related Tax Effects | Foreign Unrealized Currency Gains (Losses) on Translation (In millions) Derivatives (Loss) Gain Total Balance as of December 31, 2018 $ 20 $ ( 15 ) $ 5 Other comprehensive income before reclassifications: Pre-tax amount ( 7 ) 10 3 Tax provision 5 — 5 After-tax amount ( 2 ) 10 8 Amounts reclassified from accumulated Other Comprehensive Income (Loss) (1) ( 4 ) — ( 4 ) Net current period other comprehensive loss ( 6 ) 10 4 Balance as of December 31, 2019 $ 13 $ ( 5 ) $ 9 Other comprehensive income before reclassifications: Pre-tax amount ( 83 ) 2 ( 82 ) Tax provision 10 — 10 After-tax amount ( 73 ) 2 ( 71 ) Amounts reclassified from accumulated other comprehensive (loss) income (1) 19 — 19 Amounts reclassified due to the sale of ServiceMaster Brands Divestiture Group (2) — 5 5 Total amounts reclassified from accumulated other comprehensive income 19 5 24 Amounts reclassified within accumulated other comprehensive (loss) income (3) 25 ( 25 ) — Net current period other comprehensive income ( 29 ) ( 18 ) ( 47 ) Balance as of December 31, 2020 $ ( 16 ) $ ( 23 ) $ ( 39 ) ___________________________________ (1) Amounts are net of tax. See reclassifications out of accumulated other comprehensive income below for further details. (2) Represents ServiceMaster Brands foreign currency translation gains (losses) that were reclassified as part of the gain recognized in Net earnings from discontinued operations upon the sale of the ServiceMaster Brands Divestiture Group. (3) Represents reclassifications from our net investment hedge related to foreign currency exchange rate fluctuations. |
Schedule Of Reclassifications Out Of Accumulated Other Comprehensive Income (Loss) | Amounts Reclassified from Accumulated Other Comprehensive Income As of December 31, (In millions) 2020 2019 2018 Gains (losses) on derivatives: Fuel swap contracts $ ( 4 ) $ — $ 3 Interest rate swap contract ( 4 ) 5 1 Cross-currency interest rate swap ( 14 ) — — Net (losses) gains on derivatives ( 21 ) 5 4 Sale of ServiceMaster Brands Divestiture Group ( 5 ) — — Impact of income taxes 2 — ( 1 ) Total reclassifications for the period $ ( 24 ) $ 4 $ 3 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule Of Supplemental Information Relating To The Unaudited Condensed Consolidated Statements Of Cash Flows | Year Ended December 31, (In millions) 2020 2019 2018 Cash paid for or (received from): Interest expense (1) $ 81 $ 82 $ 122 Interest and dividend income ( 1 ) ( 3 ) ( 2 ) Income taxes, net of refunds 4 25 52 ___________________________________ (1) For the year ended December 31, 2019, excludes $ 12 million received in connection with our terminated interest rate swap. Cash and Cash Equivalents and Restricted Cash at Beginning of Period on the Consolidated Statements of Cash Flows consists of the following as presented on the Consolidated Statements of Financial Position: Year Ended December 31, (In millions) 2020 2019 2018 Cash and cash equivalents $ 615 $ 280 $ 224 Restricted cash 89 89 89 Total Cash and cash equivalents and Restricted cash $ 704 $ 368 $ 313 |
Summary Of Cash And Cash Equivalents And Restricted Cash | Year Ended December 31, (In millions) 2020 2019 2018 Cash and cash equivalents $ 615 $ 280 $ 224 Restricted cash 89 89 89 Total Cash and cash equivalents and Restricted cash $ 704 $ 368 $ 313 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Stock-Based Compensation [Abstract] | |
Schedule Of Assumptions Used To Estimate Value Of Each Option Award | Year Ended December 31, Assumption 2020 2019 2018 Expected volatility 33.8 % 28.4 % 25.9 % Expected dividend yield 0.0 % 0.0 % 0.0 % Expected life (in years) 4.9 5.0 6.3 Risk-free interest rate 0.27 % - 1.38 % 2.49 % 2.63 % - 2.94 % |
Summary Of Option Activity Under The MSIP | Aggregate Weighted Avg. Weighted Avg. Intrinsic Remaining Stock Exercise Value Contractual Options Price (in millions) Term (in years) Total outstanding, December 31, 2019 1,230,520 $ 35.30 $ 5 7.36 Granted to employees 1,003,180 $ 36.52 Exercised ( 204,768 ) $ 32.55 Forfeited ( 588,504 ) $ 36.82 Expired ( 150,104 ) $ 50.01 Total outstanding, December 31, 2020 1,290,324 $ 36.47 $ 19 6.74 Total exercisable, December 31, 2020 338,025 $ 34.67 $ 6 6.27 |
Summary Of RSU Activity Under The MSIP | Weighted Avg. Grant Date RSUs Fair Value Total outstanding, December 31, 2019 692,926 $ 40.11 Granted to employees 567,844 $ 37.81 Vested ( 262,013 ) $ 46.56 Forfeited ( 245,845 ) $ 44.75 Total outstanding, December 31, 2020 752,912 $ 40.53 |
Summary Of Performance Share Activity Under The Omnibus Incentive Plan | Weighted Avg. Performance Grant Date Shares Fair Value Total outstanding, December 31, 2019 187,746 $ 50.13 Granted to executives 134,094 $ 36.81 Forfeited ( 171,896 ) $ 49.77 Total outstanding, December 31, 2020 149,944 $ 37.77 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Measurements [Abstract] | |
Schedule Of The Carrying Amount And Estimated Fair Value Of The Company's Financial Instruments That Are Recorded At Fair Value On A Recurring Basis | Estimated Fair Value Measurements Quoted Significant Prices In Other Significant Active Observable Unobservable Statement of Financial Carrying Markets Inputs Inputs (In millions) Position Location Value (Level 1) (Level 2) (Level 3) As of December 31, 2020: Financial Assets: Deferred compensation trust assets Long-term marketable securities $ 14 $ 14 $ — $ — Fuel swap contracts Prepaid expenses and other assets and Other assets 3 — — 3 Total financial assets $ 18 $ 14 $ — $ 3 Financial Liabilities: Cross-currency interest rate swap Other long-term obligations $ 15 $ — $ 15 $ — Net investment hedge Other long-term obligations 23 — 23 — Interest rate swap contracts Accrued liabilities—Other and Other long-term obligations 34 — 34 — Total financial liabilities $ 72 $ — $ 72 $ — As of December 31, 2019: Financial Assets: Deferred compensation trust assets Long-term marketable securities $ 13 $ 13 $ — $ — Fuel swap contracts Prepaid expenses and other assets and Other assets 1 — — 1 Interest rate swap contracts Other assets 5 — 5 — Total financial assets $ 19 $ 13 $ 5 $ 1 Financial Liabilities: Interest rate swap contracts Other accrued liabilities and Other long-term obligations 1 — 1 — Total financial liabilities $ 1 $ — $ 1 $ — |
Schedule Of Reconciliation Of The Beginning And Ending Fair Values Of Financial Instruments Valued Using Significant Unobservable Inputs (Level 3) On A Recurring Basis | Fuel Swap Contract Assets (In millions) (Liabilities) Location of Loss included in Earnings Balance as of December 31, 2018 $ ( 4 ) Total (losses) gains (realized and unrealized) Included in earnings — Cost of services rendered and products sold Included in other comprehensive income 5 Settlements — Balance as of December 31, 2019 $ 1 Total gains (losses) (realized and unrealized) Included in earnings $ 4 Cost of services rendered and products sold Included in other comprehensive income 2 Settlements ( 4 ) Balance as of December 31, 2020 $ 3 |
Schedule Of Level 3 Financial Instruments | Fair Value Valuation Weighted (in millions) Technique Unobservable Input Range Average As of December 31, 2020: Fuel swap contracts $ 3 Discounted Cash Flows Forward Unleaded Price per Gallon (1) $ 2.20 - $ 2.58 $ 2.44 As of December 31, 2019: Fuel swap contracts $ 1 Discounted Cash Flows Forward Unleaded Price per Gallon (1) $ 2.37 - $ 2.80 $ 2.61 ___________________________________ (1) Forward prices per gallon were derived from third-party market data providers. A decrease in the forward price would result in a reduction in the fair value asset of the fuel swap contracts. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule Of Reconciliation Of The Amounts Included In The Computation Of Basic Earnings Per Share From Continuing Operations And Diluted Earnings Per Share From Continuing Operations | Year Ended December 31, (In millions, except per share data) 2020 2019 2018 Income (Loss) from Continuing Operations $ 20 $ 60 $ ( 227 ) Weighted-average common shares outstanding 132.7 135.8 135.5 Effect of dilutive securities: RSUs 0.2 0.1 — Stock options (1) 0.1 0.3 — Weighted-average common shares outstanding - assuming dilution 133.0 136.2 135.5 Basic earnings (loss) per share from continuing operations $ 0.15 $ 0.44 $ ( 1.68 ) Diluted earnings (loss) per share from continuing operations $ 0.15 $ 0.44 $ ( 1.68 ) ___________________________________ (1) Options to purchase 0.8 million and 0.5 million shares for the years ended December 31, 2020 and 2019, respectively, were not included in the diluted earnings per share calculation because their effect would have been antidilutive. |
Basis Of Presentation (Narrativ
Basis Of Presentation (Narrative) (Details) | Oct. 01, 2020USD ($) | Oct. 01, 2018 | Sep. 14, 2018shares | Mar. 31, 2019 | Dec. 31, 2020segment | Nov. 16, 2020USD ($) | Dec. 31, 2019 |
Basis Of Presentation [Line Items] | |||||||
Number of reportable segments | segment | 1 | ||||||
ServiceMaster Brands [Member] | |||||||
Basis Of Presentation [Line Items] | |||||||
Sale of business, consideration received | $ 1,541,000,000 | ||||||
Sale of business, gain net of tax | $ 494,000,000 | ||||||
Frontdoor, inc. [Member] | |||||||
Basis Of Presentation [Line Items] | |||||||
Pro rata dividend to the Company's stockholders, percent of outstanding shares of common stock | 80.20% | ||||||
Percentage of outstanding common share exchanged | 19.80% | ||||||
Number of shares of Parent common stock exchanged for shares of Spinoff Company | 2 | ||||||
Distributed shares of common stock | shares | 67,781,527 | ||||||
Shares of common stock retained by Company | shares | 16,734,092 | ||||||
Percent of common stock retained by Company | 19.80% | 19.80% | |||||
5.125% Notes Maturing In 2024 [Member] | |||||||
Basis Of Presentation [Line Items] | |||||||
Face amount of debt instrument | $ 750,000,000 | ||||||
Interest rate (as a percent) | 5.125% | 5.125% |
Significant Accounting Polici_4
Significant Accounting Policies (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Significant Accounting Policies [Line Items] | |||
Deferred customer acquisition cost | $ 98,000,000 | $ 94,000,000 | |
Deferred customer acquisition cost, amount amortization | 97,000,000 | 84,000,000 | |
Deferred customer acquisition cost, impairment | 0 | ||
Notes receivable, net of allowances | 27,000,000 | 38,000,000 | |
Advertising expense | 91,000,000 | 90,000,000 | $ 82,000,000 |
Depreciation of property and equipment, including depreciation of assets held under capital leases | 73,000,000 | 71,000,000 | 69,000,000 |
Impairment charge | 0 | 0 | 0 |
Goodwill impairment | $ 0 | 0 | 0 |
Lease, Option to Terminate | 1 year | ||
Option To Extend Lease Term | 15 years | ||
Accounting Standards Update 2018-15 [Member] | |||
Significant Accounting Policies [Line Items] | |||
Capitalization of development costs | $ 13,000,000 | 14,000,000 | |
Trade Names [Member] | |||
Significant Accounting Policies [Line Items] | |||
Impairment of Intangible Assets (Excluding Goodwill) | $ 0 | $ 0 | $ 0 |
Maximum [Member] | |||
Significant Accounting Policies [Line Items] | |||
Remaining Lease Term | 22 years | ||
Maximum [Member] | Vehicle Leases [Member] | |||
Significant Accounting Policies [Line Items] | |||
Remaining Lease Term | 7 years | ||
Minimum [Member] | |||
Significant Accounting Policies [Line Items] | |||
Remaining Lease Term | 1 year | ||
Minimum [Member] | Vehicle Leases [Member] | |||
Significant Accounting Policies [Line Items] | |||
Remaining Lease Term | 1 year |
Significant Accounting Polici_5
Significant Accounting Policies (Schedule Of Property And Equipment) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Gross Property and equipment | $ 538 | $ 532 |
Less accumulated depreciation | (356) | (328) |
Net property and equipment | 182 | 204 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Property and equipment | 5 | 5 |
Buildings And Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Property and equipment | $ 51 | 53 |
Buildings And Improvements [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 10 years | |
Buildings And Improvements [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 40 years | |
Technology And Communications [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Property and equipment | $ 172 | 175 |
Technology And Communications [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 3 years | |
Technology And Communications [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 7 years | |
Machinery, Production Equipment And Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Property and equipment | $ 287 | 271 |
Machinery, Production Equipment And Vehicles [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 3 years | |
Machinery, Production Equipment And Vehicles [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 9 years | |
Office Equipment, Furniture And Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Property and equipment | $ 23 | $ 28 |
Office Equipment, Furniture And Fixtures [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 5 years | |
Office Equipment, Furniture And Fixtures [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 7 years |
Significant Accounting Polici_6
Significant Accounting Policies (Adoption of ASUs, Changes To Statement Of Stockholder's Equity) (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | $ 2,741 | $ 2,322 | $ 2,204 | $ 1,167 |
Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | 3 | 16 | ||
Accumulated Other Comprehensive Income (Loss) [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | (39) | 9 | 5 | 5 |
Accumulated Other Comprehensive Income (Loss) [Member] | Cumulative Effect, Period of Adoption, Adjusted Balance [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | 7 | |||
Accumulated Other Comprehensive Income (Loss) [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | 2 | |||
Accumulated Other Comprehensive Income (Loss) [Member] | Accounting Standards Update 2016-01 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | (2) | |||
Accumulated Other Comprehensive Income (Loss) [Member] | Accounting Standards Update 2018-02 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | 4 | |||
Retained Earnings (Accumulated Deficit) [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | $ 841 | 291 | 156 | (895) |
Retained Earnings (Accumulated Deficit) [Member] | Cumulative Effect, Period of Adoption, Adjusted Balance [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | (881) | |||
Retained Earnings (Accumulated Deficit) [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | $ 3 | $ 14 | ||
Retained Earnings (Accumulated Deficit) [Member] | Impact of adopting ASC 606 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | 16 | |||
Retained Earnings (Accumulated Deficit) [Member] | Accounting Standards Update 2016-01 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | 2 | |||
Retained Earnings (Accumulated Deficit) [Member] | Accounting Standards Update 2018-02 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity | $ (4) |
Revenues (Narrative) (Details)
Revenues (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | |||
Retained Earnings | $ 841 | $ 291 | |
Revenue recognized | $ 70 | 58 | |
Impact of adopting ASC 606 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Retained Earnings | $ 16 | ||
Impact of adopting ASC 606 [Member] | Scenario, Adjustment [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Retained Earnings | $ 3 |
Revenues (Disaggregation Of Rev
Revenues (Disaggregation Of Revenue) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 1,961 | $ 1,819 | $ 1,655 |
Residential Pest Management [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 706 | 683 | 633 |
Commercial Pest Management [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 443 | 420 | 339 |
Termite and Home Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 633 | 607 | 599 |
Sales of Products and Other [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 100 | 88 | $ 84 |
European Pest Management [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 79 | $ 21 |
Revenues (Revenue By Geographic
Revenues (Revenue By Geographic Area) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 1,961 | $ 1,819 | $ 1,655 |
United States [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 1,851 | 1,767 | 1,624 |
International [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 111 | $ 52 | $ 31 |
Revenues (Movement In Deferred
Revenues (Movement In Deferred Revenue) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | ||
Business Acquisition [Line Items] | |||
Balance at beginning of period | $ 107 | $ 91 | |
Deferral of revenue | 129 | 146 | [1] |
Recognition of deferred revenue | (134) | (129) | |
Balance at end of period | $ 102 | 107 | |
Nomor [Member] | |||
Business Acquisition [Line Items] | |||
Deferral of revenue | $ 15 | ||
[1] | Includes approximately $ 15 million of deferred revenue related to our acquisition of Nomor. |
Revenues (Compare Of Presentati
Revenues (Compare Of Presentation Of Financial Statements Under ASC 606 To Under Prior Guidance) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Revenues | $ 1,961 | $ 1,819 | $ 1,655 |
Cost of services rendered and products sold | 1,155 | 1,069 | 944 |
Selling and administrative expenses | 559 | 527 | 500 |
Provision for income taxes | 24 | 5 | 14 |
Net (Loss) Income | $ 551 | $ 128 | (41) |
Under Prior Revenue Recognition Guidance [Member] | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Revenues | 1,655 | ||
Cost of services rendered and products sold | 944 | ||
Selling and administrative expenses | 507 | ||
Provision for income taxes | 12 | ||
Net (Loss) Income | (46) | ||
Impact of adopting ASC 606 [Member] | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Revenues | 1,655 | ||
Cost of services rendered and products sold | 944 | ||
Selling and administrative expenses | 500 | ||
Provision for income taxes | 14 | ||
Net (Loss) Income | $ (41) |
Goodwill And Intangible Asset_2
Goodwill And Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill And Intangible Assets [Abstract] | |||
Amortization expense | $ 36 | $ 25 | $ 14 |
Amortization expense, 2021 | 36 | ||
Amortization expense, 2022 | 34 | ||
Amortization expense, 2023 | 31 | ||
Amortization expense, 2024 | 23 | ||
Amortization expense, 2025 | $ 18 |
Goodwill And Intangible Asset_3
Goodwill And Intangible Assets (Schedule Of Goodwill Balances For Continuing Operations By Reportable Segment And For Other Operations And Headquarters) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill balances by segment for continuing operations | ||
Balance at the beginning of the period | $ 2,096 | $ 1,781 |
Acquisitions | 9 | 309 |
Purchase accounting adjustments | 29 | (2) |
Impact of foreign exchange rates | 12 | 7 |
Balance at the end of the period | $ 2,146 | $ 2,096 |
Goodwill And Intangible Asset_4
Goodwill And Intangible Assets (Schedule Of Other Intangible Asset Balances For Continuing Operations) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | ||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | |||
Gross | $ 1,608 | $ 1,626 | |
Accumulated Amortization | (497) | (457) | |
Net | 1,111 | 1,169 | |
Purchase accounting adjustments | $ 29 | (2) | |
Customer Relationships [Member] | |||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | |||
Estimated Remaining Useful Lives | [1] | 19 years | |
Gross | [1] | $ 650 | 659 |
Accumulated Amortization | [1] | (454) | (423) |
Net | [1] | $ 196 | 236 |
Customer Relationships [Member] | Nomor [Member] | |||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | |||
Purchase accounting adjustments | 17 | ||
Customer Relationships [Member] | All Other Acquisitions [Member] | |||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | |||
Purchase accounting adjustments | 7 | ||
Trade Names, Finite, And Other [Member] | |||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | |||
Estimated Remaining Useful Lives | [2] | 5 years | |
Gross | [2] | $ 70 | 79 |
Accumulated Amortization | [2] | (43) | (34) |
Net | [2] | 27 | 45 |
Trade Names, Finite, And Other [Member] | Nomor [Member] | |||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | |||
Purchase accounting adjustments | 9 | ||
Trade Names [Member] | |||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | |||
Gross | 888 | 888 | |
Net | $ 888 | $ 888 | |
[1] | Includes purchase accounting adjustments subsequent to December 31, 2019, including $ 17 million related to our acquisition of Nomor and $ 7 million related to other acquisitions, offset by foreign currency fluctuations. | ||
[2] | Includes purchase accounting adjustments subsequent to December 31, 2019, primarily related to our acquisition of Nomor, of $ 9 million. |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) $ in Millions | 12 Months Ended | |||
Dec. 31, 2020USD ($)item | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Income Taxes [Abstract] | ||||
Unrecognized tax benefits | $ 14 | $ 14 | $ 15 | $ 14 |
Unrecognized tax benefits that would impact effective tax rate if recognized | 13 | 13 | ||
Unrecognized tax benefits, reasonably possible decrease within the next 12 months | $ 2 | |||
Number of state tax authorities that are in the process of auditing state income tax returns of various subsidiaries | item | 4 | |||
Accrued interest and penalties | $ 2 | $ 2 | ||
Effective tax rate on loss from discontinued operations (as a percent) | 26.60% | 24.10% | 26.10% | |
Valuation allowance for deferred tax assets | $ 8 | $ 12 | ||
Deferred tax assets, net of valuation allowance, for federal and state net operating loss and capital loss carryforwards | 4 | |||
Deferred tax assets, net of valuation allowance, for federal and state credit carryforwards | 1 | |||
Cash associated with indefinitely reinvested foreign earnings | $ 41 | $ 35 |
Income Taxes (Components Of Inc
Income Taxes (Components Of Income (Loss) From Continuing Operations Before Income Taxes) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Components of (loss) income from continuing operations before income taxes | |||
Income (Loss) from Continuing Operations before Income Taxes | $ 41 | $ 64 | $ (214) |
Continuing Operations [Member] | |||
Components of (loss) income from continuing operations before income taxes | |||
U.S. | 46 | 76 | (212) |
Foreign | (5) | (12) | (2) |
Income (Loss) from Continuing Operations before Income Taxes | $ 41 | $ 64 | $ (214) |
Income Taxes (Reconciliation Of
Income Taxes (Reconciliation Of Effective Income Tax Rate) (Details) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Reconciliation of income tax computed at the U.S. federal statutory tax rate to the entity's effective income tax rate for continuing operations | ||||
Tax at U.S. federal statutory rate (as a percent) | 21.00% | 21.00% | 21.00% | |
State and local income taxes, net of U.S. federal benefit (as a percent) | [1] | 15.10% | 2.60% | (1.60%) |
Foreign rate differences (as a percent) | 2.10% | 0.60% | (0.40%) | |
Tax credits (as a percent) | (5.20%) | (3.50%) | 1.50% | |
Realized (gain) loss on investment in frontdoor, inc. (as a percent) | (13.30%) | (24.50%) | ||
Limitation on executive compensation (as a percent) | 2.70% | 1.20% | (0.40%) | |
Excess tax benefits from stock-based compensation (as a percent) | 0.30% | (1.80%) | 0.60% | |
Mobile Bay Formosan settlement (as a percent) | 20.30% | |||
Tax reserves (as a percent) | (2.70%) | 0.30% | (0.50%) | |
Other items (as a percent) | 4.50% | 0.20% | (0.40%) | |
U.S. Tax Reform rate change (as a percent) | [2] | (1.60%) | ||
Effective rate (as a percent) | 58.10% | 7.30% | (6.30%) | |
[1] | The increase in State and local income taxes, net of U.S. federal benefit, was driven by the Mobile Bay Formosan termite settlement. | |||
[2] | Deferred income taxes in the Consolidated Statements of Financial Position at December 31, 2018 were remeasured as a result of U.S. Tax Reform. |
Income Taxes (Income Tax Expens
Income Taxes (Income Tax Expense From Continuing Operations) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred: | |||
Total deferred | $ 8 | $ 9 | $ 8 |
Provision (benefit) for income taxes | 24 | 5 | 14 |
Continuing Operations [Member] | |||
Current: | |||
U.S. federal | 6 | (1) | 16 |
Foreign | 2 | ||
State and local | 8 | 1 | 6 |
Total current | 16 | 1 | 22 |
Deferred: | |||
U.S. federal | 8 | 4 | (10) |
Foreign | (2) | (1) | 1 |
State and local | 2 | 1 | 1 |
Total deferred | 8 | 4 | (8) |
Provision (benefit) for income taxes | $ 24 | $ 5 | $ 14 |
Income Taxes (Deferred Tax Bala
Income Taxes (Deferred Tax Balances) (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 | |
Deferred tax assets (liabilities): | |||
Intangible assets | [1] | $ (353) | $ (498) |
Property and equipment | (32) | (29) | |
Operating lease right-of-use asset | (26) | (30) | |
Prepaid expenses and deferred customer acquisition costs | (25) | (25) | |
Receivables allowances | 6 | 6 | |
Self-insured claims and related expenses | 2 | 2 | |
Accrued liabilities | 36 | 35 | |
Other long-term obligations | 13 | 4 | |
Current portion of lease liability and long-term lease liability | 28 | 32 | |
Net operating loss and tax credit carryforwards | 13 | 16 | |
Less valuation allowance | (8) | (12) | |
Net Deferred taxes | (346) | (499) | |
Deferred tax liability related primarily to the difference in the tax versus book basis of intangible assets | $ 335 | $ 505 | |
[1] | The deferred tax liability relates primarily to the difference in the tax versus book basis of intangible assets. As of December 31, 2020 and December 31, 2019, we had $ 335 million and $ 505 million, respectively, of deferred tax liability included in this net deferred tax liability, that would only be paid in certain circumstances, including liquidation or sale of various subsidiaries of the Company. |
Income Taxes (Reconciliation _2
Income Taxes (Reconciliation Of Unrecognized Tax Benefits) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of the beginning and ending amount of gross unrecognized tax benefits | |||
Gross unrecognized tax benefits at beginning of period | $ 14 | $ 15 | $ 14 |
Decreases in tax positions for prior years | (2) | ||
Increases in tax positions for current year | 4 | 1 | 3 |
Settlements | (1) | ||
Lapse in statute of limitations | (2) | (1) | (1) |
Gross unrecognized tax benefits at end of period | $ 14 | $ 14 | $ 15 |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) $ in Millions, kr in Billions | Sep. 06, 2019USD ($) | Sep. 06, 2019SEK (kr) | Mar. 31, 2018USD ($) | Dec. 31, 2020USD ($)item | Dec. 31, 2019USD ($)item | Dec. 31, 2018USD ($)item | |
Acquisitions [Line Items] | |||||||
Preliminary purchase price | $ 43 | $ 535 | $ 251 | ||||
Business acquisitions, net of cash acquired | 36 | 506 | 187 | ||||
Net cash paid | 36 | 497 | 187 | ||||
Goodwill | 2,146 | 2,096 | 1,781 | ||||
Interest expense | $ 83 | $ 87 | $ 133 | ||||
Twelve Tuck-In Pest Control [Member] | |||||||
Acquisitions [Line Items] | |||||||
Number of Businesses Acquired | item | 12 | ||||||
The 2020 Acquisitions [Member] | |||||||
Acquisitions [Line Items] | |||||||
Preliminary purchase price | $ 36 | ||||||
Goodwill | 9 | ||||||
The 2020 Acquisitions [Member] | Customer Relationships [Member] | |||||||
Acquisitions [Line Items] | |||||||
Other intangibles related to acquisitions | $ 9 | ||||||
The 2019 Acquisitions [Member] | |||||||
Acquisitions [Line Items] | |||||||
Number of Businesses Acquired | item | 39 | ||||||
Preliminary purchase price | $ 497 | ||||||
Cash Acquired from Acquisition | $ 12 | ||||||
Minority Investment [Member] | |||||||
Acquisitions [Line Items] | |||||||
Number of Businesses Acquired | item | 8 | 8 | |||||
Business acquisitions, net of cash acquired | $ 9 | ||||||
Nomor [Member] | |||||||
Acquisitions [Line Items] | |||||||
Cash Acquired from Acquisition | $ 9 | ||||||
Net cash paid | 198 | kr 2 | |||||
Goodwill | 153 | ||||||
Proceeds from revolving credit facility | 120 | ||||||
Other intangibles related to acquisitions | [1] | $ 66 | |||||
Acquisition related costs | $ 4 | $ 4 | |||||
Interest expense | $ 1 | ||||||
The 2018 Acquisitions [Member] | |||||||
Acquisitions [Line Items] | |||||||
Number of Businesses Acquired | item | 20 | ||||||
Preliminary purchase price | $ 187 | ||||||
Contingent consideration | 65 | ||||||
Cash Acquired from Acquisition | $ 2 | ||||||
Minimum [Member] | The 2018 Acquisitions [Member] | |||||||
Acquisitions [Line Items] | |||||||
Contingent consideration, term | 1 year | ||||||
Maximum [Member] | The 2018 Acquisitions [Member] | |||||||
Acquisitions [Line Items] | |||||||
Contingent consideration, term | 5 years | ||||||
[1] | Primarily customer lists. |
Acquisitions (Preliminary Purch
Acquisitions (Preliminary Purchase Price Allocation) (Details) - USD ($) $ in Millions | Sep. 06, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 2,146 | $ 2,096 | $ 1,781 | ||
Nomor [Member] | |||||
Business Acquisition [Line Items] | |||||
Current assets | [1] | $ 11 | |||
Property and equipment | 6 | ||||
Goodwill | 153 | ||||
Identifiable intangible assets | [2] | 66 | |||
Current liabilities | [3] | (20) | |||
Long-term liabilities | [4] | (19) | |||
Total purchase price | 198 | ||||
Deferred tax liabilities, tax differences in intangible assets | 15 | ||||
Cash Acquired from Acquisition | $ 9 | ||||
[1] | Primarily trade receivables and net of approximately $ 9 million of cash acquired. | ||||
[2] | Primarily customer lists. | ||||
[3] | Primarily advanced collections from customers. | ||||
[4] | Includes $ 15 million of deferred tax liabilities recognized as a result of tax basis differences in intangible assets. |
Acquisitions (Summary Of Pro Fo
Acquisitions (Summary Of Pro Forma Consolidated Financial Information) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Acquisitions [Abstract] | ||
Consolidated revenue | $ 1,854 | $ 1,705 |
Consolidated net income (loss) | $ 137 | $ (42) |
Basic earnings (loss) per share | $ 1.01 | $ (0.31) |
Diluted earnings (loss) per share | $ 1 | $ (0.31) |
Acquisitions (Schedule Of Suppl
Acquisitions (Schedule Of Supplemental Cash Flow Information Regarding Acquisitions) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Supplemental cash flow information regarding acquisitions | ||||
Assets acquired | $ 43 | $ 590 | $ 280 | |
Liabilities assumed | (56) | (30) | ||
Net assets acquired | [1] | 43 | 535 | 251 |
Seller financed debt | 7 | 38 | 64 | |
Purchase price | $ 43 | 535 | 251 | |
Deferred tax liabilities | $ 21 | $ 15 | ||
[1] | Includes approximately $ 21 million, and $ 15 million of deferred tax liabilities in the years ended December 31, 2019 and 2018, respectively, as a result of tax basis differences in intangible assets. |
Discontinued Operations (Narrat
Discontinued Operations (Narrative) (Details) $ in Millions | Oct. 01, 2020USD ($) | Oct. 01, 2018shares | Sep. 14, 2018 | Mar. 31, 2019 | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Nov. 16, 2020USD ($) | Sep. 30, 2020USD ($) |
Details of assets and liabilities and operating results of discontinued operations | |||||||||
Sublease income | $ 3 | $ 2 | $ 1 | ||||||
Goodwill and indefinite lived intangible asset impairment | 0 | 0 | 0 | ||||||
Frontdoor, inc. [Member] | |||||||||
Details of assets and liabilities and operating results of discontinued operations | |||||||||
Sublease income | 4 | 7 | 1 | ||||||
Pro rata dividend to the Company's stockholders, percent of outstanding shares of common stock | 80.20% | ||||||||
Percentage of outstanding common share exchanged | 19.80% | ||||||||
Number of shares of Parent common stock exchanged for shares of Spinoff Company | 2 | ||||||||
Shares exchanged per one share of spine-off entity | shares | 2 | ||||||||
Accounts Payable Paid On Behalf Of Spin-Off Entity | 2 | ||||||||
American Home Shield [Member] | |||||||||
Details of assets and liabilities and operating results of discontinued operations | |||||||||
Selling and administrative expenses | 2 | 1 | |||||||
Rental income | 4 | 7 | $ 1 | ||||||
ServiceMaster Brands [Member] | |||||||||
Details of assets and liabilities and operating results of discontinued operations | |||||||||
Sale of business, consideration received | $ 1,541 | ||||||||
Gain on discontinued operations | $ 494 | ||||||||
Transition Service Agreement, Fees Recorded During Period | 1 | ||||||||
Transition Service Agreement Fees, Rental Income, And Other Cost | 6 | ||||||||
Receivables, net | $ 4 | 40 | |||||||
Long-term liabilities of discontinued operations | $ 8 | ||||||||
5.125% Notes Maturing In 2024 [Member] | |||||||||
Details of assets and liabilities and operating results of discontinued operations | |||||||||
Repayment of principal amount | $ 750 | $ 750 | |||||||
Interest rate (as a percent) | 5.125% | 5.125% |
Discontinued Operations (Schedu
Discontinued Operations (Schedule Of Operating Results Of Discontinued Operations) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Operating results of discontinued operations | ||||
Revenue | $ 198 | $ 258 | $ 1,225 | |
Cost of services rendered and products sold | 93 | 110 | 630 | |
Operating expenses | [1] | 56 | 58 | 343 |
Interest and net investment income | (1) | (1) | ||
Income before income taxes | 50 | 91 | 252 | |
Provision for income taxes | 12 | 22 | 66 | |
Gain on sale, net of income taxes | (494) | |||
Net earnings from discontinued operations | 531 | $ 69 | 186 | |
Spin-off [Member] | ||||
Operating results of discontinued operations | ||||
Professional fees and other costs incurred | $ 35 | |||
ServiceMaster Brands [Member] | ||||
Operating results of discontinued operations | ||||
Professional fees and other costs incurred | $ 18 | |||
[1] | Includes $ 18 million of professional fees and other costs incurred in connection with the strategic evaluation and ultimate sale of the ServiceMaster Brands Divestiture Group in the year ended December 31, 2020, and Frontdoor spin-off related transaction costs of $ 35 million for the year ended December 31, 2018. |
Discontinued Operations (Sche_2
Discontinued Operations (Schedule Of Assets And Liabilities Of Discontinued Operations) (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Details of assets and liabilities and operating results of discontinued operations | ||
Current assets of discontinued operations | $ 45 | |
Total Current Liabilities | 42 | |
ServiceMaster Brands [Member] | ||
Details of assets and liabilities and operating results of discontinued operations | ||
Receivables, net | $ 4 | 40 |
Inventories and other current assets | 5 | |
Current assets of discontinued operations | 45 | |
Property and equipment, net | 8 | |
Operating lease right-of-use assets | 2 | |
Goodwill | 183 | |
Intangible assets, net | 622 | |
Other long-term assets | 19 | |
Total Assets of Discontinued Operations | 879 | |
Accounts payable | 8 | |
Payroll and related expenses | 5 | |
Other | 23 | |
Deferred revenue | 4 | |
Current portion of lease liability | 1 | |
Current portion of long-term debt | 1 | |
Total Current Liabilities | 42 | |
Deferred taxes | 1 | |
Other long-term obligations | 8 | |
Long-term debt | 2 | |
Total Liabilities of Discontinued Operations | $ 52 |
Discontinued Operations (Sche_3
Discontinued Operations (Schedule Of Cash Flows Of Discontinued Operations) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Cash paid for income taxes | $ 4 | $ 25 | $ 52 |
Discontinued Operations [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Depreciation | 4 | 11 | |
Amortization | 1 | 4 | 11 |
Cash paid for income taxes | 372 | ||
Capital expenditures | $ (2) | $ (4) | $ (20) |
Restructuring And Other Charg_3
Restructuring And Other Charges (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring Charges | $ 16,000,000 | $ 12,000,000 | $ 17,000,000 |
Restructuring charges, net of tax | 12,000,000 | 9,000,000 | 12,000,000 |
Other Costs [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Professional fees | $ 0 | 2,000,000 | $ 0 |
Professional fees, net of tax | $ 2,000,000 |
Restructuring And Other Charg_4
Restructuring And Other Charges (Schedule Of Restructuring Charges) (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | $ 16,000,000 | $ 12,000,000 | $ 17,000,000 | |
Impairment charges | 0 | 0 | 0 | |
Stock-based compensation expense | 16,000,000 | 14,000,000 | 13,000,000 | |
Field Operations [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | [1] | 6,000,000 | 5,000,000 | 2,000,000 |
Unpaid and accrued costs | 1,000,000 | |||
Headquarter Operations [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | [2] | 9,000,000 | 5,000,000 | 6,000,000 |
Professional Fees | 1,000,000 | |||
Severance and other restructuring costs | 1,000,000 | 3,000,000 | ||
Unpaid and accrued costs | 1,000,000 | |||
Global Service Center Relocation [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | [3] | 1,000,000 | 8,000,000 | |
Professional Fees | 1,000,000 | |||
Severance and other restructuring costs | 1,000,000 | |||
Other Costs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Professional Fees | 0 | 2,000,000 | 0 | |
Other Costs [Member] | Headquarter Operations [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | 8,000,000 | |||
Costs To Facilitate Spin-Off [Member] | Headquarter Operations [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | 4,000,000 | |||
Accelerated Depreciation On Systems [Member] | Headquarter Operations [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | $ 3,000,000 | |||
Retention Bonus [Member] | Headquarter Operations [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | $ 1,000,000 | |||
Future Rent [Member] | Global Service Center Relocation [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | $ 7,000,000 | |||
[1] | For the years ended December 31, 2020, 2019 and 2018, these charges included $ 6 million, $ 5 million and $ 2 million, respectively of lease termination and severance costs. For the year ended December 31, 2020, lease termination costs includes $3 million of impairment charges related to our former call center right of use assets and rent expense on leases we exited before the end of the lease term. Of this amount, $ 1 million was unpaid and accrued as of December 31, 2020. | |||
[2] | For the year ended December 31, 2020, includes severance and charges to enhance capabilities and reduce costs in our corporate functions that provide administrative services to support operations and other costs to enhance capabilities and align functions after the sale of the ServiceMaster Brands Divestiture Group of $ 8 million and retention bonuses to employees key to effecting the sale of the ServiceMaster Brands Divestiture Group of $ 1 million. For the year ended December 31, 2019, these charges included $ 3 million of accelerated depreciation on systems we are replacing with the implementation of our customer experience platform, $ 1 million of professional fees and other costs to enhance capabilities and align corporate functions after the American Home Shield spin-off and $ 1 million of severance and other costs. For the year ended December 31, 2018, includes $ 3 million of severance and other costs and $ 4 million of costs to facilitate the American Home Shield spin-off that were not included in discontinued operations. Of this amount, $ 1 million was unpaid and accrued as of December 31, 2020. | |||
[3] | For the year ended December 31, 2019, these charges included lease termination and other charges of $ 1 million. For the year ended December 31, 2018, these charges included $ 7 million of future rent and $ 1 million of professional and other fees. All amounts under these agreements have been paid as of December 31, 2020. |
Restructuring And Other Charg_5
Restructuring And Other Charges (Schedule Of Reconciliation Of The Beginning And Ending Balances Of Accrued Restructuring Charges) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Restructuring Cost and Reserve [Line Items] | |||
Balance at the beginning of the period | $ 1 | $ 7 | |
Costs incurred | 16 | 12 | $ 17 |
Costs paid or otherwise settled | (15) | (18) | |
Balance at the end of the period | $ 2 | $ 1 | $ 7 |
Commitments And Contingencies_2
Commitments And Contingencies (Narrative) (Details) - USD ($) $ in Millions | Nov. 20, 2017 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 |
Loss Contingencies [Line Items] | ||||
Change in estimate | $ 45 | |||
Litigation and non-litigation reserve | $ 8 | 8 | ||
Termite Settlement [Member] | ||||
Loss Contingencies [Line Items] | ||||
Change in estimate | $ 53 | $ 53 | ||
Terminix International USVI, LLC (“TMX USVI”) [Member] | Florida Fumigation Matter [Member] | ||||
Loss Contingencies [Line Items] | ||||
Legal Fines And Penalties | $ 4.6 | |||
TMX USVI and TMX LP [Member] | ||||
Loss Contingencies [Line Items] | ||||
Amount Of Community Service Payment | $ 1 | |||
Probation period | 5 years | |||
TMX USVI and TMX LP [Member] | Environmental Protection Agency (the “EPA”) [Member] | ||||
Loss Contingencies [Line Items] | ||||
Legal Fines And Penalties | $ 1.2 | |||
TMX USVI and TMX LP [Member] | Florida Fumigation Matter [Member] | ||||
Loss Contingencies [Line Items] | ||||
Legal Fines And Penalties | $ 9.2 | |||
Mobile Bay Formosan [Member] | ||||
Loss Contingencies [Line Items] | ||||
Litigation payments | $ 49 | |||
Consumer fund amount | 25 | |||
Charge recorded in period | 49 | |||
Reduction in revenue related to remediation measures | 4 | |||
Mobile Bay Formosan [Member] | Alabama [Member] | ||||
Loss Contingencies [Line Items] | ||||
Litigation Settlement, Amount | $ 19 |
Commitments And Contingencies_3
Commitments And Contingencies (Schedule Of Reconciliation Of Beginning And Ending Accrued Self-Insured Claims) (Details) - Accrued Self-Insured Claims, Net [Member] - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Commitments and Contingencies [Line Items] | ||
Balance at the beginning of the period | $ 111 | $ 111 |
Provision for self-insured claims | 44 | 36 |
Cash payments | (29) | (35) |
Balance at the end of the period | $ 126 | $ 111 |
Commitments And Contingencies_4
Commitments And Contingencies (Schedule Of Reconciliation Of Beginning And Ending Accrued Litigated Claims And Non-Litigated Claims) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Commitments and Contingencies [Line Items] | ||||
Change in estimate | $ 45 | |||
Litigated Claims And Non-Litigated Claims [Member] | ||||
Commitments and Contingencies [Line Items] | ||||
Balance at the beginning of the period | $ 80 | 28 | ||
Provision for termite damage claims | 54 | [1] | 95 | |
Cash payments | (62) | (44) | ||
Balance at the end of the period | $ 80 | $ 72 | 80 | |
Termite Settlement [Member] | ||||
Commitments and Contingencies [Line Items] | ||||
Change in estimate | $ 53 | $ 53 | ||
[1] | Includes a change in estimate of $ 53 million, as described below. |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Employee Benefit Plans [Abstract] | |||
Discretionary contributions | $ 14 | $ 14 | $ 13 |
Long-Term Debt (Term Loan Facil
Long-Term Debt (Term Loan Facility Narrative) (Details) - USD ($) | Nov. 16, 2020 | Nov. 05, 2020 | Mar. 12, 2020 | Nov. 05, 2019 | Oct. 04, 2019 | Mar. 27, 2019 | Sep. 30, 2020 | Apr. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Long-term debt [Line Items] | |||||||||||
Debt amount extinguished | $ 468,000,000 | $ 600,000,000 | |||||||||
Debt issuance costs | $ 5,000,000 | $ 3,000,000 | $ 10,000,000 | ||||||||
Payment of debt issuance costs and original issue discount costs | 6,000,000 | ||||||||||
Original debt issue discount | 1,000,000 | ||||||||||
Derivative, floor interest rate | 0.00% | ||||||||||
Loss on extinguishment of debt | (1,000,000) | 26,000,000 | 8,000,000 | $ 10,000,000 | |||||||
Term of agreement | 7 years | ||||||||||
Notional amount | $ 550,000,000 | 546,000,000 | 550,000,000 | $ 650,000,000 | |||||||
Derivative fixed rate | 1.615% | ||||||||||
Derivative terminated | 4,000,000 | $ 650,000,000 | |||||||||
Short-term Debt [Member] | |||||||||||
Long-term debt [Line Items] | |||||||||||
Debt amount extinguished | $ 150,000,000 | ||||||||||
5.125% Notes Maturing In 2024 [Member] | |||||||||||
Long-term debt [Line Items] | |||||||||||
Face amount of debt instrument | $ 750,000,000 | ||||||||||
Repayment of principal amount | 750,000,000 | $ 750,000,000 | |||||||||
Prepayment penalty | $ 19,000,000 | ||||||||||
Interest rate (as a percent) | 5.125% | 5.125% | |||||||||
Loss on extinguishment of debt | $ 19,000,000 | ||||||||||
Senior Secured Term Loan Facility Maturing In 2023 [Member] | |||||||||||
Long-term debt [Line Items] | |||||||||||
Debt amount extinguished | 171,000,000 | ||||||||||
Senior Secured Term Loan Facility Maturing In 2026 [Member] | |||||||||||
Long-term debt [Line Items] | |||||||||||
Face amount of debt instrument | 600,000,000 | ||||||||||
Advanced amortization payments | 51,000,000 | ||||||||||
Debt issuance costs | 2,000,000 | ||||||||||
Loss on extinguishment of debt | $ 1,000,000 | ||||||||||
Derivative fixed rate | 3.365% | ||||||||||
Derivative terminated | $ 4,000,000 | ||||||||||
Old Revolving Credit Facility [Member] | |||||||||||
Long-term debt [Line Items] | |||||||||||
Debt amount extinguished | 120,000,000 | ||||||||||
Revolving Credit Facility Maturing In 2024 [Member] | |||||||||||
Long-term debt [Line Items] | |||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 400,000,000 | ||||||||||
7.25% notes maturing in 2038 [Member] | |||||||||||
Long-term debt [Line Items] | |||||||||||
Interest rate (as a percent) | 7.25% | ||||||||||
7.45% notes maturing in 2027 [Member] | |||||||||||
Long-term debt [Line Items] | |||||||||||
Debt amount extinguished | $ 1,000,000 | ||||||||||
Interest rate (as a percent) | 7.45% | 7.45% |
Long-Term Debt (Term Loan Fac_2
Long-Term Debt (Term Loan Facility, Extinguishment Of Debt And Repurchase Of Notes Narrative) (Details) - USD ($) shares in Millions | Nov. 16, 2020 | Mar. 27, 2020 | Mar. 12, 2020 | Dec. 12, 2019 | Nov. 05, 2019 | Sep. 01, 2019 | Mar. 27, 2019 | Oct. 01, 2018 | Nov. 08, 2016 | Apr. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2020 | Sep. 05, 2019 | Mar. 12, 2019 | Aug. 16, 2018 |
Debt Instrument [Line Items] | ||||||||||||||||||
Extinguishment of Debt, Amount | $ 468,000,000 | $ 600,000,000 | ||||||||||||||||
Loss on extinguishment of debt | $ (1,000,000) | $ 26,000,000 | $ 8,000,000 | $ 10,000,000 | ||||||||||||||
Amount borrowed | 1,470,000,000 | 1,000,000,000 | ||||||||||||||||
Gain (Loss) on Investments | 40,000,000 | (249,000,000) | ||||||||||||||||
Proceeds From Spin-Off Entity Common Shares Retained, Net | 486,000,000 | |||||||||||||||||
Use Of Cash To Retire Short-Term Credit Facility | $ 114,000,000 | |||||||||||||||||
Amortization of debt issuance costs | $ 3,000,000 | 3,000,000 | 4,000,000 | |||||||||||||||
Percentage of capital stock of direct foreign subsidiaries | 65.00% | |||||||||||||||||
Long-term Debt and Capital Lease Obligations, Maturities, Repayments of Principal in Year Five | $ 11,000,000 | |||||||||||||||||
Long-term Debt and Capital Lease Obligations, Maturities, Repayments of Principal in Year Four | 15,000,000 | |||||||||||||||||
Long-term Debt and Capital Lease Obligations, Maturities, Repayments of Principal in Year Three | 21,000,000 | |||||||||||||||||
Long-term Debt and Capital Lease Obligations, Maturities, Repayments of Principal in Year Two | 30,000,000 | |||||||||||||||||
Long-term Debt and Capital Lease Obligations, Repayments of Principal in Next Twelve Months | 94,000,000 | |||||||||||||||||
Short-term Credit Facility [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Loss on extinguishment of debt | $ 4,000,000 | |||||||||||||||||
Face amount of debt instrument | $ 600,000,000 | |||||||||||||||||
Senior Secured Term Loan Facility Maturing In 2026 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Loss on extinguishment of debt | 1,000,000 | |||||||||||||||||
Face amount of debt instrument | 600,000,000 | |||||||||||||||||
Old Revolving Credit Facility [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Extinguishment of Debt, Amount | 120,000,000 | |||||||||||||||||
Old Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowings | $ 300,000,000 | |||||||||||||||||
Debt Instrument, Maturity Date | Nov. 8, 2021 | |||||||||||||||||
Old Revolving Credit Facility [Member] | Letter of Credit [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Repayment of principal amount | 120,000,000 | |||||||||||||||||
Maximum borrowings | $ 225,000,000 | |||||||||||||||||
Borrowings outstanding | $ 120,000,000 | |||||||||||||||||
Revolving Credit Facility Maturing In 2024 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowings | 400,000,000 | |||||||||||||||||
Available borrowing capacity | 377,000,000 | |||||||||||||||||
Revolving Credit Facility Maturing In 2024 [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowings | $ 400,000,000 | |||||||||||||||||
Debt Instrument, Maturity Date | Nov. 5, 2024 | |||||||||||||||||
Revolving Credit Facility Maturing In 2024 [Member] | Letter of Credit [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowings | $ 125,000,000 | |||||||||||||||||
Borrowings outstanding | $ 23,000,000 | |||||||||||||||||
Senior Secured Term Loan Facility Maturing In 2023 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Extinguishment of Debt, Amount | $ 171,000,000 | |||||||||||||||||
7.25% notes maturing in 2038 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate (as a percent) | 7.25% | |||||||||||||||||
7.45% notes maturing in 2027 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate (as a percent) | 7.45% | 7.45% | ||||||||||||||||
Extinguishment of Debt, Amount | $ 1,000,000 | |||||||||||||||||
Redemption percentage | 105.50% | |||||||||||||||||
5.125% Notes Maturing In 2024 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate (as a percent) | 5.125% | 5.125% | ||||||||||||||||
Repayment of principal amount | $ 750,000,000 | $ 750,000,000 | ||||||||||||||||
Loss on extinguishment of debt, includes prepayment penalty and write-offs of debt issuance costs | 25,000,000 | |||||||||||||||||
Loss on extinguishment of debt | 19,000,000 | |||||||||||||||||
Face amount of debt instrument | $ 750,000,000 | |||||||||||||||||
Spin-off [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Reduction of long term debt | $ 1,000,000,000 | |||||||||||||||||
Spin-off [Member] | Short-term Credit Facility [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Amount borrowed | $ 1,000,000,000 | |||||||||||||||||
Spin-off [Member] | Frontdoor Term Loan Facility [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Face amount of debt instrument | $ 650,000,000 | |||||||||||||||||
Spin-off [Member] | Revolving Credit Facility Maturing In 2023 [Member] | Revolving Credit Facility [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowings | $ 250,000,000 | |||||||||||||||||
Secured Debt [Member] | Spin-off [Member] | Senior Secured Term Loan Facility Maturing In 2023 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Repayment of principal amount | $ 982,000,000 | |||||||||||||||||
Loss on extinguishment of debt | $ 10,000,000 | |||||||||||||||||
Notes [Member] | 7.25% notes maturing in 2038 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate (as a percent) | 7.25% | |||||||||||||||||
Extinguishment of Debt, Amount | $ 3,000,000 | |||||||||||||||||
Redemption percentage | 99.50% | |||||||||||||||||
Notes [Member] | 7.45% notes maturing in 2027 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate (as a percent) | 7.45% | |||||||||||||||||
Extinguishment of Debt, Amount | $ 7,000,000 | |||||||||||||||||
Redemption percentage | 105.50% | |||||||||||||||||
Notes [Member] | Notes 7.45%, And 7.25% Collectively [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Loss on extinguishment of debt | $ 2,000,000 | |||||||||||||||||
Notes [Member] | Spin-off [Member] | Frontdoor Notes [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate (as a percent) | 6.75% | |||||||||||||||||
Face amount of debt instrument | $ 350,000,000 | |||||||||||||||||
Frontdoor, inc. [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt Conversion, Converted Instrument, Shares Issued | 16.7 | |||||||||||||||||
LIBOR [Member] | Fourth Amendment, Term Loan Facility [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Borrowing margin (as a percent) | 1.75% | |||||||||||||||||
LIBOR [Member] | Revolving Credit Facility Maturing In 2024 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Borrowing margin (as a percent) | 1.75% | |||||||||||||||||
Alternative Base Rate [Member] | Fourth Amendment, Term Loan Facility [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Borrowing margin (as a percent) | 0.75% | |||||||||||||||||
Alternative Base Rate [Member] | Revolving Credit Facility Maturing In 2024 [Member] | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Borrowing margin (as a percent) | 1.50% |
Long-Term Debt (Interest Rate S
Long-Term Debt (Interest Rate Swap Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2020 | Dec. 31, 2019 | Nov. 05, 2020 | Dec. 31, 2018 | ||
Derivative [Line Items] | |||||
Derivative, Average Fixed Interest Rate | [1] | 1.615% | 1.615% | 1.493% | |
Derivative, Floor Interest Rate | 0.00% | ||||
Derivative terminated | $ 4 | $ 650 | |||
Derivative, Fixed Interest Rate | 1.615% | ||||
Existing Term Facilities [Member] | |||||
Derivative [Line Items] | |||||
Amount received from terminated interest rate swap | $ 12 | ||||
Interest Rate Swap Contract [Member] | |||||
Derivative [Line Items] | |||||
Derivative terminated | $ 650 | ||||
[1] | Before the application of the applicable borrowing margin. |
Long-Term Debt (Schedule Of Lon
Long-Term Debt (Schedule Of Long-Term Debt) (Details) - USD ($) $ in Millions | Nov. 16, 2020 | Nov. 05, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Apr. 30, 2019 | Mar. 31, 2019 | |
Long-term debt [Line Items] | ||||||||
Less current portion | [1] | $ (94) | $ (69) | |||||
Total long-term debt | 826 | 1,666 | ||||||
Loss on extinguishment of debt | $ (1) | 26 | 8 | $ 10 | ||||
Fleet Agreement [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Vehicle finance leases | [2] | $ 95 | 99 | |||||
Variable rate basis | one-month LIBOR | |||||||
Senior Secured Term Loan Facility Maturing In 2023 [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Unamortized debt issuance costs | $ 7 | 6 | ||||||
Unamortized original issue discount | 1 | 1 | ||||||
Senior Secured Term Loan Facility Maturing In 2026 [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Long-term debt | [3] | 539 | 593 | |||||
Unamortized debt issuance costs | 8 | |||||||
Loss on extinguishment of debt | 1 | |||||||
5.125% Notes Maturing In 2024 [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Long-term debt | [4] | $ 742 | ||||||
Interest rate (as a percent) | 5.125% | 5.125% | ||||||
Loss on extinguishment of debt | $ 19 | |||||||
7.45% notes maturing in 2027 [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Long-term debt | [5] | $ 169 | $ 167 | |||||
Interest rate (as a percent) | 7.45% | 7.45% | ||||||
Unamortized debt issuance costs | $ 25 | 28 | ||||||
7.45% notes maturing in 2027 [Member] | Notes [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Interest rate (as a percent) | 7.45% | |||||||
7.25% notes maturing in 2038 [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Long-term debt | [5] | $ 41 | 40 | |||||
Interest rate (as a percent) | 7.25% | |||||||
7.25% notes maturing in 2038 [Member] | Notes [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Interest rate (as a percent) | 7.25% | |||||||
Notes 7.45%, And 7.25% Collectively [Member] | Notes [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Loss on extinguishment of debt | 2 | |||||||
Other [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Long-term debt | [6] | $ 77 | 94 | |||||
Repayment of long-term debt | $ 76 | $ 88 | ||||||
Minimum [Member] | Fleet Agreement [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Borrowing margin (as a percent) | 1.41% | |||||||
Maximum [Member] | Fleet Agreement [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Borrowing margin (as a percent) | 2.45% | |||||||
Copesan Services, Inc. (“Copesan”) [Member] | ||||||||
Long-term debt [Line Items] | ||||||||
Less current portion | $ (50) | |||||||
[1] | The current portion of long-term debt consists of deferred purchase price and earnout payments on acquisitions, including approximately $ 50 million due to the former owners of Copesan in 2021, and scheduled principal payments of long-term debt due within 12 months. | |||||||
[2] | We have entered into the Fleet Agreement which, among other things, allows us to obtain fleet vehicles through a leasing program. All leases under the Fleet Agreement are finance leases for accounting purposes. The lease rental payments include an interest component calculated using a variable rate based on one-month LIBOR plus other contractual adjustments and a borrowing margin ranging from 1.41 % to 2.45 % . | |||||||
[3] | As of December 31, 2020 and 2019, presented net of $ 7 million and $ 6 million, respectively, in unamortized debt issuance costs and $ 1 million and $ 1 million, respectively, in unamortized original issue discount paid as described below under “––Term Loan Facility.” (2) The 5.125 % Notes were retired on November 16, 2020, resulting in a loss on extinguishment of debt of $ 19 million. | |||||||
[4] | The 5.125 % Notes were retired on November 16, 2020, resulting in a loss on extinguishment of debt of $ 19 million. As of December 31, 2019, presented net of $ 8 million in unamortized debt issuance costs related to the 2024 notes. | |||||||
[5] | As of December 31, 2020 and 2019, presented net of $ 25 million and $ 28 million, respectively, in unamortized | |||||||
[6] | As of December 31, 2020 and 2019, includes approximately $ 76 million and $ 88 million, respectively, of future payments in connection with acquisitions. |
Long-Term Debt (Schedule Of Int
Long-Term Debt (Schedule Of Interest Rate Swap Agreements) (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Derivative [Line Items] | ||||
Balance at the beginning of the period | $ 550,000,000 | $ 650,000,000 | ||
Terminated | (4,000,000) | (650,000,000) | ||
Entered into effect | 550,000,000 | |||
Balance at the end of the period | $ 546,000,000 | $ 550,000,000 | ||
Weighted Average Fixed Rate (as a percent) | [1] | 1.615% | 1.615% | 1.493% |
Interest Rate Swap Contract [Member] | ||||
Derivative [Line Items] | ||||
Terminated | $ (650,000,000) | |||
[1] | Before the application of the applicable borrowing margin. |
Long-Term Debt (2024 & 2038 Not
Long-Term Debt (2024 & 2038 Notes Narrative) (Details) - USD ($) | Nov. 16, 2020 | Nov. 05, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2020 |
Debt Instrument [Line Items] | ||||||
Loss on extinguishment of debt | $ (1,000,000) | $ 26,000,000 | $ 8,000,000 | $ 10,000,000 | ||
5.125% Notes Maturing In 2024 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate (as a percent) | 5.125% | 5.125% | ||||
Repayment of principal amount | $ 750,000,000 | $ 750,000,000 | ||||
Loss on extinguishment of debt | 19,000,000 | |||||
Prepayment premium loss on extinguishment of debt | 25,000,000 | |||||
Face amount of debt instrument | $ 750,000,000 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | |||
Assets recorded under finance leases | $ 249 | $ 220 | |
Property and equipment acquired through finance leases and other non-cash financing transactions | $ 35 | ||
Finance Lease, accumulated depreciation | 155 | 127 | |
Finance lease, liability, current | $ 35 | $ 35 | |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Long-term Debt, Current Maturities | Long-term Debt, Current Maturities | |
Finance lease, liability, noncurrent | $ 60 | $ 60 | |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Long-term Debt and Capital Lease Obligations | Long-term Debt and Capital Lease Obligations | |
Finance Lease, lease not yet commenced, amount | $ 2 | ||
Finance Lease, lease not yet commenced, term of contract | 5 years |
Leases (Components Of Lease Exp
Leases (Components Of Lease Expense) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Leases [Abstract] | |||
Depreciation of finance lease ROU assets | $ 39 | $ 35 | |
Interest on finance lease liabilities | 3 | 5 | |
Operating lease cost | 25 | 26 | |
Variable lease cost | 2 | 3 | |
Sublease income | (3) | (2) | $ (1) |
Total lease cost | $ 66 | $ 67 |
Leases (Supplemental Cash Flow
Leases (Supplemental Cash Flow Information And Other Information For Leases) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Operating cash flows for operating leases | $ 27 | $ 24 |
Operating cash flows for finance leases | 3 | 5 |
Financing cash flows for finance leases | 38 | 34 |
ROU assets obtained in exchange for lease obligations: Operating leases | 4 | 12 |
ROU assets obtained in exchange for lease obligations: Finance leases | $ 36 | $ 43 |
Weighted Average Remaining Lease Term (in years): Operating leases | 10 years 6 months 7 days | 10 years 6 months 29 days |
Weighted Average Remaining Lease Term (in years): Finance leases | 3 years 5 months 8 days | 3 years 4 months 2 days |
Weighted Average Discount Rate: Operating leases | 5.30% | 5.55% |
Weighted Average Discount Rate: Finance leases | 4.86% | 4.13% |
Leases (Future Minimum Lease Pa
Leases (Future Minimum Lease Payments Under Non-Cancellable Leases) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Leases [Abstract] | ||||
Operating Leases, 2021 | [1] | $ 23 | ||
Operating Leases, 2022 | [1] | 20 | ||
Operating Leases, 2023 | [1] | 15 | ||
Operating Leases, 2024 | [1] | 12 | ||
Operating Leases, 2025 | [1] | 10 | ||
Operating Leases, Thereafter | [1] | 72 | ||
Operating Leases, Total future minimum lease payments | [1] | 152 | ||
Operating Leases, Less imputed interest | [1] | (39) | ||
Operating Leases, Total | [1] | 113 | ||
Finance Leases, 2021 | 36 | |||
Finance Leases, 2022 | 26 | |||
Finance Leases, 2023 | 19 | |||
Finance Leases, 2024 | 11 | |||
Finance Leases, 2025 | 6 | |||
Finance Leases, Thereafter | 3 | |||
Finance Leases, Total future minimum lease payments | 100 | |||
Finance Leases, Less imputed interest | (5) | |||
Finance Leases, Total | 95 | |||
Expected sublease income, amount expected each year | 3 | |||
Sublease Income | $ 3 | $ 2 | $ 1 | |
[1] | Each year through 2033 is presented net of approximately $ 3 million of projected annual sublease income from ServiceMaster Brands and Frontdoor for their subleases of our headquarters. Sublease income of approximately $ 3 million, $ 2 million and $ 1 million was recognized within Selling and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, 2020, 2019 and 2018, respectively. |
Comprehensive Income (Loss) (Na
Comprehensive Income (Loss) (Narrative) (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Nov. 05, 2020 | Dec. 31, 2018 | |
Derivative [Line Items] | ||||
Derivative Notional Amount Agreement Terminated | $ 4,000,000 | $ 650,000,000 | ||
Derivative, Notional Amount | 546,000,000 | 550,000,000 | $ 550,000,000 | $ 650,000,000 |
Interest Rate Swap Contract [Member] | ||||
Derivative [Line Items] | ||||
Derivative Notional Amount Agreement Terminated | 650,000,000 | |||
Derivative, Fair Value, Net | $ 12,000,000 | |||
Interest rate swap, remaining unamortized amount | $ 6,000,000 |
Comprehensive Income (Loss) (Su
Comprehensive Income (Loss) (Summary Of The Activity In Other Comprehensive Income (Loss), Net Of The Related Tax Effects) (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance at the beginning of period | $ 9 | $ 5 | |||
Other comprehensive income before reclassifications: | |||||
Pre-tax amount | (82) | 3 | |||
Tax provision | 10 | 5 | |||
After-tax amount | (71) | 8 | |||
Amounts reclassified from accumulated other comprehensive (loss) income | [1] | 19 | |||
Amount reclassified due to the sale of ServiceMaster Brands Divestiture Group | [2] | 5 | |||
Total amounts reclassified from accumulated other comprehensive income | 24 | (4) | [1] | ||
Net current period other comprehensive (loss) income | (47) | 4 | $ (3) | ||
Balance at the end of period | (39) | 9 | 5 | ||
Unrealized Gains (Losses) On Derivatives [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance at the beginning of period | 13 | 20 | |||
Other comprehensive income before reclassifications: | |||||
Pre-tax amount | (83) | (7) | |||
Tax provision | 10 | 5 | |||
After-tax amount | (73) | (2) | |||
Amounts reclassified from accumulated other comprehensive (loss) income | [1] | 19 | |||
Total amounts reclassified from accumulated other comprehensive income | 19 | (4) | [1] | ||
Amount reclassified within accumulated other comprehensive (loss) income | [3] | 25 | |||
Net current period other comprehensive (loss) income | (29) | (6) | |||
Balance at the end of period | (16) | 13 | 20 | ||
Foreign Currency Translation [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Balance at the beginning of period | (5) | (15) | |||
Other comprehensive income before reclassifications: | |||||
Pre-tax amount | 2 | 10 | |||
After-tax amount | 2 | 10 | |||
Amount reclassified due to the sale of ServiceMaster Brands Divestiture Group | [2] | 5 | |||
Total amounts reclassified from accumulated other comprehensive income | 5 | ||||
Amount reclassified within accumulated other comprehensive (loss) income | [3] | (25) | |||
Net current period other comprehensive (loss) income | (18) | 10 | |||
Balance at the end of period | $ (23) | $ (5) | $ (15) | ||
[1] | Amounts are net of tax. See reclassifications out of accumulated other comprehensive income below for further details. | ||||
[2] | Represents ServiceMaster Brands foreign currency translation gains (losses) that were reclassified as part of the gain recognized in Net earnings from discontinued operations upon the sale of the ServiceMaster Brands Divestiture Group. | ||||
[3] | Represents reclassifications from our net investment hedge related to foreign currency exchange rate fluctuations. |
Comprehensive Income (Loss) (Sc
Comprehensive Income (Loss) (Schedule Of Reclassifications Out Of Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Impact of income taxes | $ (24) | $ (5) | $ (14) |
Net Income (Loss) | 551 | 128 | (41) |
Amount Reclassified From Accumulated Other Comprehensive Income (Loss) [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Sale of ServiceMaster Brands Divestiture Group | (5) | ||
Unrealized Gains (Losses) On Derivatives [Member] | Amount Reclassified From Accumulated Other Comprehensive Income (Loss) [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net (losses) gains on derivatives | (21) | 5 | 4 |
Impact of income taxes | 2 | (1) | |
Net Income (Loss) | (24) | 4 | 3 |
Unrealized Gains (Losses) On Derivatives [Member] | Amount Reclassified From Accumulated Other Comprehensive Income (Loss) [Member] | Fuel Swap Contracts [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net (losses) gains on derivatives | (4) | 3 | |
Unrealized Gains (Losses) On Derivatives [Member] | Amount Reclassified From Accumulated Other Comprehensive Income (Loss) [Member] | Interest Rate Swap Contract [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net (losses) gains on derivatives | (4) | $ 5 | $ 1 |
Unrealized Gains (Losses) On Derivatives [Member] | Amount Reclassified From Accumulated Other Comprehensive Income (Loss) [Member] | Cross-Currency Interest Rate Swap [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net (losses) gains on derivatives | $ (14) |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Schedule Of Supplemental Information Relating To The Unaudited Condensed Consolidated Statements Of Cash Flows) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Cash paid for or (received from): | ||||
Interest expense | [1] | $ 81 | $ 82 | $ 122 |
Interest and dividend income | (1) | (3) | (2) | |
Income taxes, net of refunds | $ 4 | $ 25 | $ 52 | |
[1] | For the year ended December 31, 2019, excludes $ 12 million received in connection with our terminated interest rate swap. |
Supplemental Cash Flow Inform_4
Supplemental Cash Flow Information (Summary Of Cash And Cash Equivalents And Restricted Cash) (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Supplemental Cash Flow Information [Abstract] | |||
Cash and cash equivalents | $ 615 | $ 280 | $ 224 |
Restricted cash | 89 | 89 | 89 |
Total Cash and cash equivalents and Restricted cash | $ 704 | $ 368 | $ 313 |
Capital Stock (Details)
Capital Stock (Details) - shares | Dec. 31, 2020 | Dec. 31, 2019 |
Capital Stock [Abstract] | ||
Common stock registered for offering and sale | 2,000,000,000 | 2,000,000,000 |
Shares of common stock issued | 148,400,384 | 147,872,959 |
Shares of common stock outstanding | 132,080,845 | 135,408,054 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) $ / shares in Units, $ in Millions | Sep. 15, 2020USD ($)$ / sharesshares | Jan. 01, 2019shares | Jan. 31, 2019 | Dec. 31, 2020USD ($)item$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Apr. 27, 2015shares |
Stock-Based Compensation [Line Items] | |||||||
Number of shares of common stock available for issuance | 16,396,667 | ||||||
Number of shares of entity's common stock based on the fair market value of which maximum per-share exercise price is determined | $ / shares | $ 1 | ||||||
Period for which vested options will remain exercisable following termination of employment without cause | 3 months | ||||||
Period for which vested options will remain exercisable following termination of employment without cause in case of death, disability or retirement at normal retirement age | 1 year | ||||||
Number of shares of available for issuance | 5,133,314 | ||||||
Stock-based compensation expense | $ | $ 16 | $ 14 | $ 13 | ||||
Stock-based compensation expense, net of tax | $ | 12 | $ 10 | $ 9 | ||||
Total unrecognized compensation costs related to non-vested stock options and restricted share units | $ | $ 33 | ||||||
Weighted-average period of recognition of stock-based compensation cost | 1 year 9 months | ||||||
Executives, Officers And Employees [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Granted to employees (in shares) | 1,003,180 | 634,743 | 502,004 | ||||
MSIP And Omnibus Incentive Plan [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Number of shares of Common Stock offered | 0 | 0 | 0 | ||||
Employee Stock Purchase Plan [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Discount established by the Company, maximum percent of the then-current fair market value | 10.00% | ||||||
Employee stock purchase plan, number of shares sold | 45,840 | 14,429 | 0 | ||||
Number of shares of common stock available for issuance | 783,315 | 1,000,000 | |||||
Stock Options [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Number of equal annual vesting installments | item | 4 | ||||||
Granted to employees (in dollars per share) | $ / shares | $ 36.51 | $ 40.04 | $ 55.18 | ||||
Weighted-average grant-date fair value (in dollars per share) | $ / shares | $ 11.23 | $ 11.91 | $ 17.68 | ||||
Forfeiture rate (as a percent) | 25.52% | ||||||
Total intrinsic value of stock options exercised | $ | $ 2 | $ 10 | $ 6 | ||||
Total fair value of stock options vested | $ | $ 5 | $ 3 | 3 | ||||
Vesting period | 3 years | 4 years | |||||
Stock Options [Member] | MSIP And Omnibus Incentive Plan [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Granted to employees (in shares) | 1,003,180 | ||||||
Granted to employees (in dollars per share) | $ / shares | $ 36.52 | ||||||
Vesting period | 10 years | 8 years | |||||
Requisite service period | 3 years | ||||||
Super Performance Options Granted To CEO [Member] | Chief Executive Officer [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Forfeiture rate (as a percent) | 0.00% | ||||||
RSUs [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Number of equal annual vesting installments | item | 3 | ||||||
Granted fair value | $ | $ 2 | ||||||
Weighted average exercise price | $ / shares | $ 40.67 | ||||||
Granted to employees (in shares) | 567,844 | ||||||
Granted to employees (in dollars per share) | $ / shares | $ 37.81 | ||||||
Total fair value of RSUs vested | $ | $ 10 | $ 8 | $ 18 | ||||
Number of shares of common stock into which each award will be converted upon vesting | 1 | ||||||
RSUs [Member] | Executives, Officers And Employees [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Granted to employees (in shares) | 567,844 | 516,775 | 354,931 | ||||
Granted to employees (in dollars per share) | $ / shares | $ 37.81 | $ 42.11 | $ 52.40 | ||||
RSUs [Member] | Executives From Strategic Acquisition [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Granted to employees (in shares) | 136,092 | ||||||
RSUs [Member] | President, Terminix Commercial [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Granted to employees (in shares) | 24,589 | ||||||
Retention award amount | $ | $ 1 | ||||||
RSUs [Member] | President, Terminix Commercial [Member] | March 15, 2021 [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Granted to employees (in shares) | 12,194 | ||||||
Performance Based Shares [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Granted to employees (in shares) | 95,916 | 107,149 | |||||
Granted to employees (in dollars per share) | $ / shares | $ 36.99 | $ 40.04 | |||||
Vesting period | 3 years | ||||||
Performance Based Shares [Member] | Nomor Executives [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Granted to employees (in shares) | 87,920 | ||||||
Granted to employees (in dollars per share) | $ / shares | $ 56.87 | ||||||
Vesting period | 3 years | ||||||
Performance Based Shares [Member] | Executives From Strategic Acquisition [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Granted to employees (in shares) | 38,178 | 8,912 | |||||
Granted to employees (in dollars per share) | $ / shares | $ 36.35 | $ 56.11 | |||||
Vesting period | 4 years | ||||||
Spin-off [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Stock-based compensation expense | $ | $ 3 | ||||||
Spin-off [Member] | Performance Based Shares [Member] | |||||||
Stock-Based Compensation [Line Items] | |||||||
Granted to employees (in shares) | 0 |
Stock-Based Compensation (Sched
Stock-Based Compensation (Schedule Of Assumptions Used To Estimate Value Of Each Option Award) (Details) - Stock Options [Member] | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Assumptions used to estimate value of each option award | |||
Expected volatility (as a percent) | 33.80% | 28.40% | 25.90% |
Expected dividend yield (as a percent) | 0.00% | 0.00% | 0.00% |
Expected life (in years) | 4 years 10 months 24 days | 5 years | 6 years 3 months 18 days |
Risk-free interest rate, minimum (as a percent) | 0.27% | 2.49% | 2.63% |
Risk-free interest rate, maximum (as a percent) | 1.38% | 2.94% |
Stock-Based Compensation (Summa
Stock-Based Compensation (Summary Of Option Activity Under The MSIP) (Details) - Stock Options [Member] - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Weighted Average Exercise Price | |||
Granted to employees (in dollars per share) | $ 36.51 | $ 40.04 | $ 55.18 |
MSIP And Omnibus Incentive Plan [Member] | |||
Stock Options | |||
Total outstanding at the beginning of the period (in shares) | 1,230,520 | ||
Granted to employees (in shares) | 1,003,180 | ||
Exercised (in shares) | (204,768) | ||
Forfeited (in shares) | (588,504) | ||
Expired (in shares) | (150,104) | ||
Total outstanding at the end of the period (in shares) | 1,290,324 | 1,230,520 | |
Total exercisable at the end of the period (in shares) | 338,025 | ||
Weighted Average Exercise Price | |||
Total outstanding at the beginning of the period (in dollars per share) | $ 35.30 | ||
Granted to employees (in dollars per share) | 36.52 | ||
Exercised (in dollars per share) | 32.55 | ||
Forfeited (in dollars per share) | 36.82 | ||
Expired (in dollars per share) | 50.01 | ||
Total outstanding at the end of the period (in dollars per share) | 36.47 | $ 35.30 | |
Total exercisable at the end of the period (in dollars per share) | $ 34.67 | ||
Total Outstanding, Beginning of Period | $ 5,000 | ||
Total Outstanding, End of Period | 19,000 | $ 5,000 | |
Total exercisable, End of Period | $ 6,000 | ||
Weighted Average Remaining Contractual Term | |||
Total outstanding at the end of the period | 6 years 8 months 26 days | 7 years 4 months 9 days | |
Total exercisable at the end of the period | 6 years 3 months 7 days |
Stock-Based Compensation (Sum_2
Stock-Based Compensation (Summary Of RSU Activity Under The MSIP) (Details) - RSUs [Member] | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
RSUs | |
Total outstanding at the beginning of the period (in shares) | shares | 692,926 |
Granted to employees (in shares) | shares | 567,844 |
Vested (in shares) | shares | (262,013) |
Forfeited (in shares) | shares | (245,845) |
Total outstanding at the end of the period (in shares) | shares | 752,912 |
Weighted Average Grant Date Fair Value | |
Total outstanding at the beginning of the period (in dollars per share) | $ / shares | $ 40.11 |
Granted to employees (in dollars per share) | $ / shares | 37.81 |
Vested (in dollars per share) | $ / shares | 46.56 |
Forfeited (in dollars per share) | $ / shares | 44.75 |
Total outstanding at the end of the period (in dollars per share) | $ / shares | $ 40.53 |
Stock-Based Compensation (Sum_3
Stock-Based Compensation (Summary Of Performance Share Activity Under The Omnibus Incentive Plan) (Details) - Performance Based Shares [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Performance Shares | ||
Granted to executives (in shares) | 95,916 | 107,149 |
Weighted Average Grant Date Fair Value | ||
Granted to executives (in dollars per share) | $ 36.99 | $ 40.04 |
2014 Omnibus Incentive Plan [Member] | ||
Performance Shares | ||
Total outstanding at the beginning of the period (in shares) | 187,746 | |
Granted to executives (in shares) | 134,094 | |
Forfeited (in shares) | (171,896) | |
Total outstanding at the end of the period (in shares) | 149,944 | 187,746 |
Weighted Average Grant Date Fair Value | ||
Total outstanding at the beginning of the period (in dollars per share) | $ 50.13 | |
Granted to executives (in dollars per share) | 36.81 | |
Forfeited (in dollars per share) | 49.77 | |
Total outstanding at the end of the period (in dollars per share) | $ 37.77 | $ 50.13 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) kr in Millions | Nov. 05, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2020SEK (kr) | Mar. 03, 2020USD ($) | Mar. 03, 2020SEK (kr) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Term of agreement | 7 years | ||||||
Aggregate notional amount | $ 550,000,000 | $ 546,000,000 | $ 550,000,000 | $ 650,000,000 | |||
Derivative fixed rate | 1.615% | ||||||
Hedging gains and losses in accumulated other comprehensive income expected to be recognized in earnings, net of tax | (6,000,000) | ||||||
Carrying Value [Member] | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Total debt | 920,000,000 | 1,735,000,000 | |||||
Estimated Fair Value [Member] | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Fair value of total debt | $ 989,000,000 | $ 1,839,000,000 | |||||
Fixed-To-Fixed Cross-Currency Interest Rate Swap [Member] | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Term of agreement | 5 years | ||||||
Derivative, maturity date | Mar. 31, 2025 | ||||||
Aggregate notional amount | $ 74,000,000 | kr 725 | |||||
Fixed-To-Fixed Cross-Currency Interest Rate Swap [Member] | Sweden, Kronor [Member] | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Derivative fixed rate | 3.50% | 3.50% | |||||
Fixed-To-Fixed Cross-Currency Interest Rate Swap [Member] | United States of America, Dollars [Member] | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Derivative fixed rate | 4.147% | 4.147% | |||||
Cross Currency Swap [Member] | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Term of agreement | 5 years | ||||||
Derivative, maturity date | Mar. 31, 2025 | ||||||
Aggregate notional amount | $ 131,000,000 | kr 1,275 | |||||
Derivative fixed rate | 0.00% | 0.00% | |||||
Fuel Swap Contracts [Member] | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Aggregate notional amount | $ 23,000,000 | ||||||
Letters of credit posted as collateral under fuel hedging program | $ 2,000,000 |
Fair Value Measurements (Schedu
Fair Value Measurements (Schedule Of The Carrying Amount And Estimated Fair Value Of The Company's Financial Instruments That Are Recorded At Fair Value On A Recurring Basis) (Details) - Recurring [Member] - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Carrying Value [Member] | ||
Financial Assets: | ||
Deferred compensation trust | $ 14 | $ 13 |
Total financial assets | 18 | 19 |
Total financial liabilities | 72 | 1 |
Carrying Value [Member] | Cross-Currency Interest Rate Swap [Member] | ||
Financial Assets: | ||
Derivative contracts | 15 | |
Carrying Value [Member] | Net Investment Hedge [Member] | ||
Financial Assets: | ||
Derivative contracts | 23 | |
Carrying Value [Member] | Fuel Swap Contracts [Member] | ||
Financial Assets: | ||
Derivative asset, Noncurrent | 3 | 1 |
Carrying Value [Member] | Interest Rate Swap Contract [Member] | ||
Financial Assets: | ||
Derivative asset, Noncurrent | 5 | |
Derivative contracts | 34 | 1 |
Estimated Fair Value [Member] | Quoted Prices In Active Markets (Level 1) [Member] | ||
Financial Assets: | ||
Deferred compensation trust | 14 | 13 |
Total financial assets | 14 | 13 |
Estimated Fair Value [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Financial Assets: | ||
Total financial assets | 5 | |
Total financial liabilities | 72 | 1 |
Estimated Fair Value [Member] | Significant Other Observable Inputs (Level 2) [Member] | Cross-Currency Interest Rate Swap [Member] | ||
Financial Assets: | ||
Derivative contracts | 15 | |
Estimated Fair Value [Member] | Significant Other Observable Inputs (Level 2) [Member] | Net Investment Hedge [Member] | ||
Financial Assets: | ||
Derivative contracts | 23 | |
Estimated Fair Value [Member] | Significant Other Observable Inputs (Level 2) [Member] | Interest Rate Swap Contract [Member] | ||
Financial Assets: | ||
Derivative asset, Noncurrent | 5 | |
Derivative contracts | 34 | 1 |
Estimated Fair Value [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Financial Assets: | ||
Total financial assets | 3 | 1 |
Estimated Fair Value [Member] | Significant Unobservable Inputs (Level 3) [Member] | Fuel Swap Contracts [Member] | ||
Financial Assets: | ||
Derivative asset, Noncurrent | $ 3 | $ 1 |
Fair Value Measurements (Sche_2
Fair Value Measurements (Schedule Of Reconciliation Of The Beginning And Ending Fair Values Of Financial Instruments Valued Using Significant Unobservable Inputs (Level 3) On A Recurring Basis) (Details) - Fuel Swap Contracts [Member] - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of the beginning and ending fair values of financial instruments valued using significant unobservable inputs (Level 3) | ||
Balance at the beginning of the period | $ 1 | $ (4) |
Total gains (losses) (realized and unrealized) | ||
Included in earnings | 4 | |
Included in other comprehensive income | 2 | 5 |
Settlements | (4) | |
Balance at the end of the period | $ 3 | $ 1 |
Fair Value Measurements (Sche_3
Fair Value Measurements (Schedule Of Level 3 Financial Instruments) (Details) - Fuel Swap Contracts [Member] $ in Millions | Dec. 31, 2020USD ($)$ / gal | Dec. 31, 2019USD ($)$ / gal | Dec. 31, 2018USD ($) | |
Information relating to the significant unobservable inputs of Level 3 financial instruments | ||||
Fair value | $ | $ 3 | $ 1 | $ (4) | |
Discounted Cash Flows [Member] | Minimum [Member] | ||||
Information relating to the significant unobservable inputs of Level 3 financial instruments | ||||
Forward Unleaded Price per Gallon (in dollars per gallon) | [1] | 2.20 | 2.37 | |
Discounted Cash Flows [Member] | Maximum [Member] | ||||
Information relating to the significant unobservable inputs of Level 3 financial instruments | ||||
Forward Unleaded Price per Gallon (in dollars per gallon) | [1] | 2.58 | 2.80 | |
Discounted Cash Flows [Member] | Weighted Average [Member] | ||||
Information relating to the significant unobservable inputs of Level 3 financial instruments | ||||
Forward Unleaded Price per Gallon (in dollars per gallon) | [1] | 2.44 | 2.61 | |
[1] | Forward prices per gallon were derived from third-party market data providers. A decrease in the forward price would result in a reduction in the fair value asset of the fuel swap contracts. |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) shares in Millions | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Weighted Average Potentially Dilutive Shares Excluded From EPS Calculation, Exercise Price | $ / shares | $ 29.34 |
RSUs [Member] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Weighted Average Potentially Dilutive Shares Excluded From EPS Calculation | 0.2 |
Stock Options [Member] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Weighted Average Potentially Dilutive Shares Excluded From EPS Calculation | 0.4 |
Earnings Per Share (Schedule Of
Earnings Per Share (Schedule Of Reconciliation Of The Amounts Included In The Computation Of Basic Earnings Per Share From Continuing Operations And Diluted Earnings Per Share From Continuing Operations) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Income (Loss) from Continuing Operations | $ 20 | $ 60 | $ (227) | |
Weighted-average common shares outstanding | 132.7 | 135.8 | 135.5 | |
Effect of dilutive securities: | ||||
Weighted-average common shares outstanding-assuming dilution | 133 | 136.2 | 135.5 | |
Basic earnings (loss) per share from continuing operations (in dollars per share) | $ 0.15 | $ 0.44 | $ (1.68) | |
Diluted earnings (loss) per share from continuing operations (in dollars per share) | $ 0.15 | $ 0.44 | $ (1.68) | |
RSUs [Member] | ||||
Effect of dilutive securities: | ||||
Dilutive securities | 0.2 | 0.1 | ||
Stock Options [Member] | ||||
Effect of dilutive securities: | ||||
Dilutive securities | [1] | 0.1 | 0.3 | |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 0.8 | 0.5 | ||
[1] | Options to purchase 0.8 million and 0.5 million shares for the years ended December 31, 2020 and 2019, respectively, were not included in the diluted earnings per share calculation because their effect would have been antidilutive. |