ROL - Earnings call transcript Q4 2019

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Operator

Good day, and welcome to the Rollins, Inc. Fourth Quarter 2019 Earnings Conference Call. Today's conference is being recorded. At this time, all participants are in a listen-only mode. Later, we will be conducting a question-and-answer session and instructions will be given at that time. Instructions] [Operator

like Meek, host you now Marilyn today's introduce Ms. Meek. may to would for your call, I begin.

Marilyn Meek

press Thank should you, the have you release. all received Cassidy. a copy By now of

contact copy anyone if like one, list. XXX-XXX-XXXX a send is distribution we a release sure our However, on and and the at office Company's make missing to would receive will you and please you are

call, one which call There The will one will of be accessed the for a hour with XXXXXXX. be and can the run X-XXX-XXX-XXXX the week. replay replay after dialing begin by passcode

Additionally, www.viavid.com, be will the being call days. is webcast and a XX for at replay available

and with open Vice will Rollins' today Chief then make John Officer and Chief Chief On presenting are and we and will President the Financial for Management questions. Officer; me Eddie line Northen, Operating Vice the President, and Officer; Senior Chairman some Gary Rollins, Treasurer. Executive your remarks line Rollins' opening and Wilson,

begin. Gary, like would to you

Gary Rollins

Yes, our Marilyn, read joining XXXX will morning. Eddie will all thank then disclaimer conference call. we fourth appreciate good for and our us begin. you, statement quarter and and forward-looking of you We

Eddie Northen

and forward-looking discusses differ. information XX-K press risks the uncertainties and refer more that all today's on release of section Please make earnings release our historical XX, Form statement any this Risk results contains actual materially particular cause today. actual factors December statements. risk been certain business XXXX year including for to and and outlook Factors forward-looking to excluding could statements Our SEC and we of the may our subject other ended These have to for and filings, are the that facts, statements our made number risks call, from a differ

Gary Rollins

to Thank or $XX diluted of or XXXX. diluted Revenues $X.XX quarter approximately same share for for million the compared income year. the you, quarter to XX.X% million the Net share million million $X.XX quarter grew per in for to fourth $XXX compared was $XXX.X fourth Eddie. $XX.X per last

increased for billion XX.X% full-year Revenues billion to for to $X.XXX compared $X.XXX the XXXX.

last broke income was Net full-year pleased We net of $XX earnings share will compared this we Net one-time income $X.XX plan a down in impacted casualty This per $XXX.X for year reserve to with by or our year. was are $X.XX. million closing address per million further that $X for all negatively few of income share these and billion minutes. $XXX.X Eddie a increase. charges charge the pension diluted the million milestone.

in services lines rose to good termite XX.X%. with all growth business and and We commercial, quarter, of grew for XX.X%, continue our solid fumigation, experience the up ancillary residential X.X%; excluding

I basis a time regular exposure During structures good on termite this and claims. and of we treating many claims infestations our the and is provide damage. of that to fourth question thought from termite heard quarter a damage service a termite were investors over protecting was, implemented years your to initiatives history that be might some what on background the and

from XXXX structures. other States XXXX, its a was was uses, in a to numerous termite United to against termiticide Chlordane pesticide homes Chlordane effective in years. as background, XX As and control the infestations used Among very

termites. treating States were In from for United Orkin only fact, XXXX, year was XXXX before. the uses in stopped a to use of - to Chlordane In narrowed all with Chlordane control Chlordane XXXX, canceled. approved had

This to avoid EPA, like industry helped the asbestos prior stampede where Company manufacturer this Velsicol and the and agreement is both action, voluntarily Company, the noteworthy Chlordane Orkin potential negotiated the to banned, that, situation. and that an they law manufacturing not to stop Chemical Velsicol it a It between be the our agreed. suit

as world well was the In of mid-'XXs, didn't post-Chlordane termite work as state The Chlordane. chemicals the the daunting. replacement

period termiticide new failed within had miserably. by very been that failure This the short by and time. happened positively a EPA so the manufacturers However, of the endorsed promoted

Orkin, to the homes faced in with guarantees, to as one returned vengeance. customers' our a millions time at appearing Termites There now of with customers' along home with repair which industry business well control its pest lifetime other damage led obligations. costs was retreatment were challenge. a termite with as suddenly repair major dollars companies' due corresponding

the retreatment Orkin took been with had previously a step with proactive termite product very targeting XXXX, In better product. program began ineffective treated important the all and new homes a a that

our wanted a We of Simply, $XXX the protection first deserve. customers customers termite at our we to they curtail the it million. provide put the and cost than occurred, before damage more

lifetime replace of guarantees country will home and the depending three guarantees area five of type retreatment on the the Our construction. to

Incidentally, for and XXXX work P&L increased - proud in our and that all decreased brand, made protect termite efforts resulted reflected revenues, profit while our forward-looking retreatment this income Our termite Orkin's Orkin's to we and operating a revenues are results. XX%. customers, X%, reputation. margins investment decrease The expense impact retreatment negatively financial to Company and our claims,

up termite free any the escalating claims. we occur. had knew termite fund extra pay $XXX we the and We made make repairs efforts to set reserve decision to damage retreatments of following a million cost for that XXXX, year, and conscious these provide the to promptly cover

agent our chemical the always reputation short-term point costs treating training, turning protected termite appropriately difficult-to-treat - sheet. us of and us meters they the structures. in of caused This the of balance applied, termiticide utilization flow the further extremely make to While measure in to volume as use enhancements also were and painful, carrying a caused foam

We annually were branches We and and service to team a termite season. created compliance before technicians created to to visit swarm quality treating national attended treating our our termite audit being specs school followed. each ensure termite a procedures

to termite We completed on a do inspection quality our also managers required treatments. all

following exist years than treatments. industry's the actions over to and on a go the of dozen termite with we we could today. these that initiatives provided ensure All I took on other still best more

and actions have reserve tremendously. termite these other All related costs our reduced of

I business. the our more other to now over turn will John and areas on war insight call for termite of

John Wilson

Thank you, Gary.

mid-'XXs, chemicals year. by as it XXXX, averaged clear of was Chlordane as didn't damage the noted, Gary As the In Orkin's around in to $X million treatment prior replacement per termite the years termites. work claims well three the just

the exceeded Over couple claims in year. of years, years the XXXX next million expense By termite several multiplied claims for a and fashion. damage dramatic thereafter, $XX

to processes services process, by of were our other then industry many new and made treatment our These icon technical by team. protocols. team group, Decisions members improve Hardy, by were developed our and Paul leadership training, led

of obligations our Companywide put us The solely to place allowed approach issues accelerating issue. to meeting out quality in helped and program during Orkin customers. assurance operations This focus get their time termite into concentrated that all termite this front to on on

team We words, concern. that at assurance also our business. Formosan de-risk quality many has In taken termite the well were time, to other made which a our growing addressed as time served actions other recent as termite headlines, already as service they over

of As and and retreatments steady actions seen many these activities, a have we from decline a result year-to-year. in claims

was had It recent run. that easy field standpoint, experienced time, easy this but termite as it from many also on to took to it have continued it the and work a was we is damage on we finger more and In worth long capital things was issue, reductions mentioned put painful, was not we to both costly put our What change It teams. in changed. it the is a to financial it in your a hard long that have on cultural so finger years, further the claims. with and occur human is

each of seen of fallen claim amount has early to the highest middle in the average The the from part XXXXs.

below experienced for the of termite expenses full-year. claim termite Rollins and low XXXX, termite historically revenues claims For volumes X% were

anything our direct our and experience This concerns our customer to for now termite enough programs control to is quality appreciate and result understand given better. have of that the initiated. never certainly We we granted. We take information hope termite we leadership claims you many responsibility around seriously damage the your take

something a the that and turn let's about on So talk for minute. page else topic

a we know, As most slow year. start to off last got of you

certainly in manager week-long everything prepared repeat can to to early that, performance. in we are meeting We regional not January, Pursuant a concluded to leadership Atlanta. do that we

those leaders had from the meeting in event. mistakes. several our from improving experience, focused priorities, safety most of were our all, do etc. a But not around maybe This world to on, culture and of over important lessons customer ago the for learned this we among repeat on XXX what We to practices, and focused year

behind that lessons and It challenge, be to that We last put meeting is up learned darn And came from this and were them. year, XXXX the I that our this pretty away after the to glad teams are the best said believe true. ready to energized, hardest.

and the over Eddie. Thank to back you, will now turn I call

Eddie Northen

Thanks, John.

and the our for and of second review the employee my quarter, growth, revenue our deviated both record produced to the double-digit continued retention. growth in in strong the normal I results produced path year. in operations numbers QX, the begin results pattern want I turned weather QX more and and that EBITDA the of normal during recognize from quarter, half improvements operations customer nature of After mother Before her the financial the solid

to I John Specifically, our shared any related management that and our hope that rest and service about year-over-year. service for retention recent you both that three put concerns improved our commercial Orkin service all the in details termite most the and points to matters. lines the of percentage have will X.X Gary industry. our employee Consistency discussions retention increased line experienced termite also

rising Canada, scheduling insurance final $X.XX, very expense related growth next quarter, of to in were, routing phase the we increase strong of and BOSS and the stages by the impacted the revenue results and had the that accident a depreciation pilot rollout the successful items For and quarter reduced that journey. of a QX

casualty be insurance reporting QX QX my our that non-operational to the to addition impacted numbers, full-year to today accidents results, injuries. share and specifically will In our related and focus event and

you give will XXXX great some already I that on a to have some start. Lastly, insight off items

the through go results. will I First,

year's revenues an of taxes numbers, Income XXXX. before the $XXX.X at $XXX of income fourth of million. the quarter million, was X.XXX% $XX revenue Looking above increase over million was XX.X% the quarter or prior fourth

$XX.X XXXX to the in income pension by in due higher rate the down million, to was Net quarter X.XXX% tax and a compared QX. adjustment impacted

rose XX.X% $XX.X and to share GAAP earnings per compared XXXX. EBITDA per Our were was share diluted $X.XX million and

numbers, transition the at the pension adjustment of keep our $XX made Rollins that mind in QX million pension the that was in XXXX looking full-year almost When off books. to

are acquisition currency we results. adjustment, year, the For non-GAAP out Clark for the our calling pension expense, and

$X.XX, were $X.XXX billion, million in XXXX $XXX.X an revenue XXXX. decreased EBITDA XX.X% billion. per million $X.XXX $XXX.X year's XX.X% to $X.XX. full-year, down XX% XX.X% of income the X.X% before was income million XXXX. increase of Net Income the and $XXX.X from million, to earnings revenue taxes share For prior XX-month of $XXX.X from was numbers over compared down to fell

$XXX.X pension the income adjustment, up to $XXX.X our XXXX. Without was in before non-GAAP million million to compared tax income X.XXX%

net income from down EBITDA, Adjusted Our million to was was share including diluted million, earnings $X.XX QX loss, per share X.X%. per XXXX. X.XXX% were $X.XX up diluted our pension per share, $XXX.X in down and $XXX.X

on in years. Our reserve Companywide our XXXX casualty few focus reductions in personal created has since safety the last

additional XXXX roughly substantially and X% quarter experienced and increase of Clark accidents the by in and higher reserve premium combination within the However, casualty $X.XX. our rates the injuries industry and properties to for impacted caused a vehicles over

and initiatives As to our compensation recent leadership kickoff reviewed at extensively of reduce we John earlier, you and frequency good and these meeting with annual our the automotive workers' claims. opportunities have severity shared

continue fleet, outcomes training, a accident will result safety moving coupled automotive growing to percentage when of injury refresh in enhanced our with vehicles our better and our and have enhanced forward. we As features

ingrained at forward and as of becoming Safety the move in an XXXX. is see value will we benefits we Rollins this

We quarters. in this more will of journey share future

discussed with experience with some we in to am and our ongoing updates routing details our our improve pleased and quarter, customer to operational As the to journey. share regards last scheduling. to I efficiency step continued next

At rolled XXX points or the technicians' time, a to these basis BOSS. XXXX, CRM basis that in out points we changes. operating our in stated and stages, branch would with see system improved scheduling. we called XXX routing we margin And improvement back beginning our First,

next And as several we the you probably amount years. know, exceeded over that

pest We of customer demand, our phase keeping piloted but routing customer level based needs. the in and customer jobs mind have which technicians will the of next successfully loading on include control scheduling,

routing is efficiency phase to robust two four for This step the basis of and in On we drive top to that miles points X XXX to improved reduction, phase two last over will points scheduling reduced initiative three the over of basis have million of the will which accelerating will mileage come. years, years another to a XXX few we years. next margin equate see improvement that

through take quarter. service by the a fourth the look Let's line revenue Rollins for

Clark revenue total growth. other XX.X% of was and organic and Our and X.X% X.X% from pricing acquisitions increase included the from remaining

In which our control, of revenue total, and services, pest residential termite was XX% made revenue, revenue, which was was X.X%. of X.X%. ex-fumigation, up revenue which up grew made up was control, ex-fumigation, commercial XX% made termite our up X.X%, and and that, X.X%, Again, pest less of ancillary was up up up ancillary approximately XX.X%, total residential acquisitions our X%, XX% by From commercial, increased and up XX.X%.

two to like are items There note. that I would

second, with and residential program six the experienced our of termite at than years. slowdown growth our bed strong we the business in growth. helped growth product And bug our in continued XX% ancillary offset the fastest mosquito one-time First, more over has continued the rate and past

margin to from increases the several Clark our expense driven In year's personnel-related XX.X% salaries, the and match. salaries, XXX-K XX.X% The in quarter. in of quarter reduced for gross service administrative categories, total, by experienced mostly in prior categories

as Removing impact earlier. margin the Additionally, discussed to XX.X% claims in in improved XXXX, up compared XXXX. gross XX.X% were Clark, to insurance and substantially of

increased amortization increased and intangible large amortization to mentioned the and while from $X increased Depreciation due to to million, acquisitions customer Depreciation equipment of assets earlier, as of quarter amortization several the expenses XX.X%. of purchases million, million acquisitions. $X.X $XX.X an due contracts $X.X increase for million

we will earlier. finalize routing QX discussed our next journey rollout BOSS and depreciation as Our XXXX of slightly as be Canada to higher the in the of move and phase in scheduling

XX.X% Sales, spend the and million due revenues Clark general not of for claims that or is quarter XX.X% acquisitions, X.XXX% up for insurance The XXXX and increase and increased fourth $XXX.X million revenues, or in advertising administrative primarily $XXX.X quarter percent XXXX. expenses for fourth the in of or of of our $XX million was number. from the to particularly XX% to revenues

cash Before review current want update position, our I flow. the our cash to I state of

our over from five As free years. residual to Not year, $XX for QX $XX million only we our pension Clark related of flow do I flow average which to call, around compares to million Control, we see Pest also the mentioned the the of benefits improvements but have on cash our some the by past will acquisition transition. see an accelerated over cash we

dividends period cash our million on million XXXX XX, for $XXX.X spent year. acquisitions the we position, million We December for on period to ended $XXX.X As compared $XX.X last at the paid foreign same and $XX.X cash, which $XX.X with million in both had million which We were is CapEx, by to subsidiaries. $XX.X flat XXXX. period the held our of of million ended

the dividend Board by a is dividend year consecutive of the marks will This The XXth Directors a a quarterly on increased of stockholders $X.XX declared XX.X% Board February has XX%. cash share paid XXXX. XXXX XX, minimum March be the regular over the dividend that record XX, cash dividend. to of at Yesterday, prior the of of per business year's increase close our

the Gary, turn you. I call to over will back

Gary Rollins

thank Eddie. Well, you,

We questions take to are at happy time. your this

Operator

question Our Mario Instructions] [Operator of Cortellacci you. from Jefferies. first Thank comes

Mario Cortellacci

thanks time. Hi, for the

as least deals So, not just sense be for doing I to for in think, the but to I your expect is type current year above-average outsized XXXX. and I going market. I less is at are of be off multiples impacting XXXX, should do wanted while as be competitor remain a XXXX think, they year? larger wanted to multiples large the going aggressive XXXX, or what planning in if for they what another yours a And, to could not see of M&A to be you're Maybe another just a - year? going mean, get we paying. I seeing peak if that on a, are

Gary Rollins

Yeah.

above Company's industry did will no I average from we the industry but We the say from that largest what our obviously within mean, is have historically, that Mario, little a there which rates. I have the that we So, a the yeah, deviated acquisition we just paid that, perspective history, question in bit several higher within have. - multiple paid not have historic acquisition than was

has of from And annual normal which the that seller We somewhere history, accomplish. of and then trying our between really to have and revenue. it times that not comes is decision the down X.XX X.XX been deviated it times selection they are making what to

in dollar they there there, that, you If are market that that as competitors the trying seller largest the multiples. stated, paid to out is have get higher just can

is day-to-day We in add don't to that would John have have like involved a if We else been something more with think great diligent know and made that And, really some - and I have I you selection. very to basis that. you on

John Wilson

anybody's say, there. can I top. I would would they No, rather to much, - to I only know, approach, really hard don't be to from it will we really that a Company. a I know and when don't be much, but in want but have mile maintain go our discipline that I as then but solid down extra to is it guess go XXXX how willing And is think little

Mario Cortellacci

wanted technology And, map road didn't into just locations your already wondering just that are question Great. technology how be using many and of where term. to customers a or how is just or if I connected how big guess, you know technology, at? you give then, of us that overall? on longer your I technology And fits sense a quick your can fast how connected many

Eddie Northen

connected several technology now. We testing been years have for

sure technology the and is technology, are have can as of testing technical well course, our group IT our as it rapidly. We I'm as assume, all constantly you our changing group, support

that customers different test are using have products. We

able ready continuing position and to are what change be respond today. at to in appropriate change prepared we any point doing what would I this in there sort are industry to to if service make point an material that from time, of we are this we very there. when think, a not are we it, or we is perspective need, a doing We feel just customer At that. in to or time, But we are shift doing as from and a supplement

Gary Rollins

like One that think our advantage of Eddie, using I have I several is to software. would that brands are add. different we

monitor the the a as that to we to of product. best are position use features the So, really successes and exist always, course, in and,

Western certainly converting is will of other point, and think superior this out next year. BOSS products available. we are We it be At everything that is I it carefully that worthwhile when can watch is there, the but

Eddie Northen

the and to - we side we that, any technology more efficient some think both this, link are manner, team the a us technology have able do ability and to at connected people time on time add and but looking I really to every And, every very in from I be smart it confident where we technical gives point. our to that, feel that are the in at support this

Mario Cortellacci

you. Great. Thank

Operator

Our Research. Buckingham of Clement next from question Jamie comes

Jamie Clement

costs. early earnings that you pressure in be got you Is and that advertising issue? guys, and much mind, season, that it being elections and can years that marketing or from out seems of that although did bit chains called there be it in - really an your front sort something it Hey, on restaurant of increase investors that mix ago. have or industries recall have I your tweak is with I not impact margin might ago calls of you eyes it have heavily us on four much just years with have in like that of little four in there their don't increasing as discussed of out a advertise in some the

Eddie Northen

in CMO against for you're is last this one the Smith up potential he not election, with for Kevin talking with has and been several about this up this hurdle the area he been rising hurdle, has our years. the specifically costs but against

not escalate. last Digital the marketing to everyone as far areas as percent changed period for years. tremendously budget But Kevin's has advertising to cost shifted over marketing over that - a the continue we as in knows, digital to time six those revenue. And

using still So leads done are have he the out and number figuring service that the team out there. how tremendous do his a just lines, different we that the different by of need create opportunities we job

be way advertising he going be is through business. bucket will results able is advertising, Some billboards, some order And through things goes through commercial to our this demand I grow digital, that of go in that be it that total create to on need going it like to of to but to a the create. able different is figures be going we to of be year and to that to don't XXXX see and out some you able that any being for be uses and

Jamie Clement

great, numbers years. obviously and final have the for they and quarter Eddie, just The reported one the couple thing. that you last termite Okay, good for strong very of been

During disproportionate picture, thing. consistent? has of and and they places a reported or kind kind domestically been are thinking that segment versus your the differences climate there bigger quarter both in about looking growth termite internationally in like just Australia pretty the or last of And, year over of level I'm back two,

Eddie Northen

will say, seen have not is just things area out geographic different. general, but specific I don't that been areas, any We we tremendously in by Yeah, break of sort

have folks job great our our - all a growing markets. this product have We of across done

in-house tools that, We financing folks have U.S., piece a big has the have done our a and of tremendous our done been a Within job. our we push job that have, closing tremendous a using big sales

service pest our of customers. what into opportunity And, get set and termite while to a have our the to pest we we control and knowing continue talking the residential a talk cross the of get sell we get then outcomes, for control chance about have we the there. with cross we people sell, largest of We that out customers or chance And this is word had to John and and our it a of on Gary mouth is great service. to quality the when quality are camped out an

Jamie Clement

all time you for much your Thank as always. very

Eddie Northen

Jamie. Thanks,

Operator

question Mulrooney next Tim comes Blair. from Our of William

Tim Mulrooney

lesson Gary, X% termite were termite expenses of on X% thank X% total the business. revenue or John, below full-year. revenue? of claims, the for you the termite the claims And, history for very for was of revenue That that damage great said informative. Is you

John Wilson

it No, is of termite X% revenue.

Tim Mulrooney

All do talk just while you to plan I make right. what differently can this year with thought, I from to I prepare or about for but to just wanted were the spring wanted sure. meeting got primary John, is you what That business can leaders the you with make And, pest least also recent that us season? at I sure. takeaways one What share you, your to publicly?

John Wilson

focused would single year. tricky the doing market, Yeah, are our for just-in-time the seasonality a a delay staffing tightrope to walk tough but operators stub more to to this what really think in That field is approach. of of I business that our on our a biggest is thing be labor

Tim Mulrooney

guys. Okay. Thank you,

Operator

Thank you.

Our question Brian Stifel. Butler next comes of from

Brian Butler

give could Is on in the that hoping, things some out was bit half of that? heading mean, XXXX? organic on into is there XXXX. of strong a some was could I pace sustainable it little great. back Okay, I that or put maybe there you growth pressure on color

Eddie Northen

going was it nature know forward put you is ago. it. mother But but has than don't January time. a better much right We never now in know is I on what it year to celebrating. to do anything year would month pressure you be mean, in early been the as move we that know, of a

two country's storms You negatively the impacted know look back-to-back largest might like. never In history, that XXXX, things. storms, in we two what our had storms

that come that believe and we believe no an variables start perspective. lot really given good today, everything So we a a off we that know year we play, there growth reason have won't will organic are to of from good are into that but we to have

product a do far mosquito product to able during now for been that of We opportunity as our about With I prepared the continue with the cross-sell a great see remarks, opportunity. grow cross-sell third particular that. able We as we to have growth termite my mentioned opportunity, as being year, our to as talked

going there think very Pricing So are are is and rational we I are see price to that things on. lot still positive able very increase. of

feel organic very good an growth from So perspective. XXXX we about

Gary Rollins

I And think that the was had XX most is disappointing have share this it for years. We important to year

I in So an charges many we experience, Eddie. my one-time never seen so think anomaly. have that it was

Eddie Northen

Noticed that.

Gary Rollins

I have learned this And, on I think hit but from past seriously, mean, We the John year, it head.

we think too ambitious, too soon. I got

You from them and disappointments mother learning from the a season But some mistakes can't them. had make due taking our believer nature. and benefiting to we conference. we I'm of a leaders had powerful and And very

Our people year. we that the to good are going technology we think with And are are optimistic. a we have enlisting,

Brian Butler

Okay, last very And then that is helpful. one one.

we really service into salaries, continuing On to XXXX? a the cost, costs those you kind XXXX? forward the is that should about in Or limited think had pointed out higher cost Clark around of

Eddie Northen

purchase closed the X. May was Well,

then. X, time, that be May new will point in by at we but it So will until be lapping

Operator

Markets. comes from Seth Our next Capital question RBC Weber of

Seth Weber

on Just last to follow just -- question. that following up

that to year this Does quarter? the to vehicles, fourth level clarification. become continue the elevated you have expect better that be is or next I'm Just of - does feel issue, insurance a kind make do year? this the new sure next an in install overhang you whatnot, it - the into to you the sorry claims isolated for training this, And like see and here understanding in technology on do until you new

Eddie Northen

time the insurance to not the for this do that anomaly in question. that forward. Appreciate first that We see an dramatically. believe of increased industry items move I two we rates as you pointed was We issue an out. asking bit continue from a several The years, little

have that double-digits, strong would talk groups commercial would about. they Some

increase our about in total was X%. casualty in Our

feel But technology of though, we And those we as in are managing total from continued are piece down. our claims year-over-year. from that side, a going take a that see the enhancements the When I at to positive a have results think we as was again automotive look that come with training you that with claims perspective, the well will as our that. the vehicles, automotive

dividends that So as time. know forward that we we in pay move will

Seth Weber

is the the portion impacted quarter out that And Okay. the insurance displace how it possible just of on gross to margin much in that?

Eddie Northen

I off breakout, know that head. in don't top head. know we don't I number have that number that my off that but our sure I'm my the top of of the

Seth Weber

just Okay. on the... And

Eddie Northen

in total It was a earnings. us worth our $X.XX to for

you So can...

Seth Weber

Right.

Eddie Northen

kind a idea that could perspective. You from get of rough

Seth Weber

over I years XXX new a next several the that Okay. expected, level? guess XXX just talked of you is for to from the the was is compare. about margin? the some sure then baseline I improvement to of it kind think And off initiatives off things. basis of what points when the basis the just, points want Thanks. I make I that current margin and additional that pre-Clark just, I'm Is understand of of

Eddie Northen

lapse, that. Clark once comparison negative a from have Well, we will of less

is basis So really to basis at look pre-Clark the operations going XXX from you it and enhance could moving this levels points. say the by forward to we are XXX overall points our as

Seth Weber

the was what that? on timing sorry, And, Okay.

Eddie Northen

to two years. three Next

Seth Weber

Two to three.

Thank you That very Okay. is I much. all had.

Eddie Northen

Thanks.

Operator

Blair. have of Mulrooney Instructions] We a [Operator Tim William follow-up question from

Tim Mulrooney

dividends? more have you after down capital your allocation I with bit Eddie, pay that Can fourth that cash plans a get what are to me and M&A trying thank taking you I down? debt respect follow-up quarter. for handle on how saw XXXX would question. over debt little for in to much you left to you pay cash am the Hey, for used remind guys my a

Eddie Northen

one market, we number opportunity keep priority it But some right is right comes our that us the if fact that and debt we valuation. find and use Well, - to will number is forward right of to have now with then keep pest out If our acquire the that to and our move good control one to not the companies. they the will will able about, come be continue as priority cash quality that. we

our Number dividend, down were to there will announced two just we we from priority, and then debt. increase we our able pay that

that were the continue that last to little there move more to then and just us, if down. sense aggressive So come makes to are some, years. several like opportunities down to are we quality slow going market that a we we have bit good paying to debt it be forward will If over

kind of with So stand we that that. is where

Tim Mulrooney

for clarification. you. Thanks the Got

Eddie Northen

Yeah, absolutely.

Operator

no And have at further queue. we in this questions time,

Gary Rollins

joining us Well, all for thank today. you

We to our We our our very in about you appreciate on look quarter first going call. updating And your interest forward. forward on Company's optimistic our progress Company. again. are opportunities Thanks,

Operator

Thank gentlemen, and this you. Ladies teleconference. this concludes

You may now disconnect.

Rollins (ROL) 29 Jan 202019 Q4 Earnings call transcript