Rollins Revenue Rises 6.2% as Residential Organic Growth Trails

Rollins, Inc. posted 6.2% third-quarter revenue growth, while organic residential revenue rose more slowly than organic commercial revenue, showing different growth rates across its two businesses.

Revenue for the quarter ended Sept. 30 totaled $1.09 billion. Organic revenue reached $1.07 billion, up 4.4% from a year earlier.

Residential revenue increased 4.9% to $499.7 million. Organic residential revenue was $487.4 million, with acquisitions contributing $12.3 million. Commercial revenue climbed 7.7% to $360.7 million, and organic commercial growth was 6.6%.

“Residential customer acquisition remained under pressure in the third quarter,” said Will Harkins, Rollins’ executive vice president and chief financial officer.

Operating income fell 1% to $222.9 million. The operating margin narrowed to 20.5% from 21.9% a year earlier, while adjusted earnings per share declined 2.9% to $0.34.

Operating cash flow increased 26.4% to $241.9 million. The timing of a tax refund tied to Rollins’ tax credit planning strategy benefited quarterly cash flow by $63 million. Revenue growth continued for a 100th consecutive quarter.

Rollins is the parent company of Orkin and other pest-control brands. Rollins' operations and franchises serve more than 2.8 million customers across six continents. The company’s earnings call is scheduled for Oct. 22 at 8:30 a.m. ET (12:30 UTC).