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What changed in ABM INDUSTRIES INC /DE/'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of ABM INDUSTRIES INC /DE/'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+207 added−203 removedSource: 10-K (2024-12-19) vs 10-K (2023-12-18)

Top changes in ABM INDUSTRIES INC /DE/'s 2024 10-K

207 paragraphs added · 203 removed · 169 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

70 edited+15 added−8 removed131 unchanged
Biggest changeA significant number of our employees are covered by collective bargaining agreements that could expose us to potential liabilities in relation to our participation in multiemployer pension plans, requirements to make contributions to other benefit plans, and the potential for strikes, work slowdowns or similar activities, and union organizing drives. 14 We participate in various multiemployer pension plans that provide defined pension benefits to employees covered by collective bargaining agreements.
Biggest changeIncreased costs of legal and regulatory compliance with this constantly evolving legal and regulatory environment could reduce our profitability and adversely affect our financial condition. 14 A significant number of our employees are covered by collective bargaining agreements that could expose us to potential liabilities in relation to our participation in multiemployer pension plans, requirements to make contributions to other benefit plans, and the potential for strikes, work slowdowns, or similar activities, and union organizing drives.
As a result of these strategic initiatives and investments, we have strengthened our ability to offer janitorial, engineering, parking and eMobility, infrastructure, electrical, lighting and energy solutions, HVAC and mechanical services, landscaping and turf services, and mission critical solutions across aviation, education, manufacturing and distribution, and commercial business industries, on a standalone basis or in combination, and positioned ourselves as a leading integrated facilities management company.
As a result of these strategic initiatives and investments, we have strengthened our ability to offer janitorial, engineering, parking and eMobility, infrastructure, electrical, lighting and energy solutions, HVAC and mechanical services, landscaping and turf services, and mission critical solutions across aviation, education, manufacturing and distribution, and commercial business industries, on a standalone basis or in combination, and have positioned ourselves as a leading integrated facilities management company.
A cornerstone of ABM’s comprehensive risk management and safety program is safety awareness to confirm our employees are: • educated on how to complete tasks safely; • trained in hazard identification; • made aware of emergency response procedures to immediately address challenges; and • proficient in reporting accidents and utilizing applicable procedures to confirm appropriate loss mitigation techniques are implemented should a loss occur.
A cornerstone of ABM’s comprehensive risk management and safety program is safety awareness to confirm our employees are: • educated on how to complete tasks safely; • trained in hazard identification; • made aware of emergency response procedures to immediately address challenges; and • proficient in reporting accidents, utilizing applicable procedures to confirm appropriate loss mitigation techniques are implemented should a loss occur.
These investments in and changes 10 to our business systems and processes may not create the growth, operational efficiencies, competitive advantage, or cost benefits that we expect and could result in unanticipated consequences, including disruptions to our back-office operations and service delivery.
These investments in and changes to our business systems and processes may not create the growth, operational efficiencies, competitive advantage, 10 or cost benefits that we expect and could result in unanticipated consequences, including disruptions to our back-office operations and service delivery.
A potential acquisition, divestiture, or other strategic transaction may involve a number of risks including, but not limited to: • the transaction may not effectively advance our business strategy, and its anticipated benefits may never materialize; • our ongoing operations may be disrupted, and management time and focus may be diverted; • clients or key employees of an acquired business may not remain, which could negatively impact our ability to grow that acquired business; • integration of an acquired business’s accounting, information technology, HR, and other administrative systems may fail to permit effective management and expense reduction; • unforeseen challenges may arise in implementing internal controls, procedures, and policies; • additional indebtedness incurred as a result of an acquisition may impact our financial position, results of operations, and cash flows; and • unanticipated or unknown liabilities may arise related to an acquired business.
A potential acquisition, divestiture, or other strategic transaction may involve a number of risks including, but not limited to: • the transaction may not effectively advance our business strategy, and its anticipated benefits may never materialize; • our ongoing operations may be disrupted, and management time and focus may be diverted; • clients or key employees of an acquired business may not remain, which could negatively impact our ability to grow that acquired business; • integration of an acquired business’s accounting, information technology, cybersecurity, HR, and other administrative systems may fail to permit effective management and expense reduction; • unforeseen challenges may arise in implementing internal controls, procedures, and policies; • additional indebtedness incurred as a result of an acquisition may impact our financial position, results of operations, and cash flows; and • unanticipated or unknown liabilities may arise related to an acquired business.
For example, being highly leveraged could: require us to dedicate a substantial portion of our cash flows from operations to the 15 payment of debt service, reducing the availability of our cash flow to fund working capital, share repurchases, capital expenditures, acquisitions, and other general corporate purposes; limit our availability to obtain additional financing in the future to enable us to react to changes in our business; and place us at a competitive disadvantage compared to businesses in our industry that have less debt.
For example, being highly leveraged could: require us to dedicate a substantial portion of our cash flows from operations to the payment of debt service, reducing the availability of our cash flow to fund working capital, share repurchases, capital expenditures, acquisitions, and other general corporate purposes; limit our availability to obtain additional financing in the future to enable us to react to changes in our business; and place us at a competitive disadvantage compared to businesses in our industry that have less debt.
We cannot guarantee that our business will generate sufficient cash flow from our operations or that future borrowings will be available to us in an amount sufficient to enable us to service our debt, fund other liquidity needs, make planned capital expenditures, or continue our dividend. The degree to which we are leveraged could have important consequences for shareholders.
We cannot guarantee that our business will generate sufficient cash flow from our operations or that future borrowings will be available to us in 15 an amount sufficient to enable us to service our debt, fund other liquidity needs, make planned capital expenditures, or continue our dividend. The degree to which we are leveraged could have important consequences for shareholders.
While we believe our new ERP and boundary systems will enhance and standardize our processes, allow better oversight, and improve our service to our customers, any disruption to this transition could impact our ability to send and track invoices, process vendor payments, pay employees, fulfill contractual obligations, report our financial results, or otherwise operate our business.
While we believe our new ERP 12 and boundary systems will enhance and standardize our processes, allow better oversight, and improve our service to our customers, any disruption to this transition could impact our ability to send and track invoices, process vendor payments, pay employees, fulfill contractual obligations, report our financial results, or otherwise operate our business.
Our information technology systems and those of our third-party providers or clients could be the target of cyberattacks, ransomware attacks, hacking, unauthorized access, phishing, computer viruses, malware, or other 12 intrusions, which could result in operational disruptions or information misappropriation, such as theft of intellectual property or inappropriate disclosure of confidential, proprietary, or personal information.
Our information technology systems and those of our third-party providers or clients could be the target of cyberattacks, ransomware attacks, hacking, unauthorized access, phishing, computer viruses, malware, or other intrusions, which could result in operational disruptions or information misappropriation, such as theft of intellectual property or inappropriate disclosure of confidential, proprietary, or personal information.
Weather conditions such as snow storms, heavy flooding, hurricanes, and fluctuations in temperatures can negatively impact portions of our business. Within our Technical Solutions segment, cooler than normal temperatures in the summer could reduce the need for servicing of air conditioning units, resulting in reduced revenues and profitability.
Weather conditions such as snow storms, heavy flooding, hurricanes, and fluctuations in temperatures can negatively impact portions of our business. Within our Technical Solutions segment, cooler than normal 16 temperatures in the summer could reduce the need for servicing of air conditioning units, resulting in reduced revenues and profitability.
On the other hand, the absence of snow during the winter could cause us to 16 experience reduced revenues in our B&I segment, as many of our contracts specify additional payments for snow-related services. Catastrophic events, disasters, pandemics, and terrorist attacks could disrupt our services.
On the other hand, the absence of snow during the winter could cause us to experience reduced revenues in our B&I segment, as many of our contracts specify additional payments for snow-related services. Catastrophic events, disasters, pandemics, and terrorist attacks could disrupt our services.
Any significant additional federal fund rate increases may have a material adverse effect on our business, results of operations, and financial condition, and may cause our customers to implement cost saving strategies that could reduce the demand of our services.
Any significant federal fund rate increases may have a material adverse effect on our business, results of operations, and financial condition, and may cause our customers to implement cost saving strategies that could reduce the demand of our services.
A material change in our insurance costs due to changes in the frequency of 13 claims, the severity of the claims, the costs of excess/umbrella premiums, or regulatory changes could have a material adverse effect on our financial position, results of operations, or cash flows.
A material change in our insurance costs due to changes in the frequency of claims, the severity of the claims, the costs of excess/umbrella premiums, or regulatory changes could have a material adverse effect on our financial position, results of operations, or cash flows.
Further, to the extent that we self-insure our losses, deterioration in our loss control and/or our continuing claim management efforts could increase the overall cost of claims within our retained limits.
Further, to the extent that we self-insure our losses, deterioration in our loss control and/or our continuing claim management efforts could increase the overall 13 cost of claims within our retained limits.
(collectively, “Able”), a leading facilities services company headquartered in San Francisco, California, with the goal to provide additional scaling to the Company’s core businesses and key geographies and bolstering ABM’s janitorial and facilities services service lines. In addition, the acquisition of Able (“the Able Acquisition”) further expanded ABM’s sustainability and energy efficiency offerings amid growing demand for environmentally responsible solutions.
(collectively, “Able”), a leading facilities services company headquartered in San Francisco, California, with the goal to provide additional scaling to the Company’s core businesses and key geographies and bolstering ABM’s janitorial and facilities services service lines. In addition, the acquisition of Able further expanded ABM’s sustainability and energy efficiency offerings amid growing demand for environmentally responsible solutions.
Our results of operations can be adversely affected by labor shortages, turnover, and labor cost increases. We employ approximately 123,000 persons, and our operations depend on the services of a large and diverse workforce. We must attract, train, and retain a large and growing number of qualified employees while controlling related labor costs.
Our results of operations can be adversely affected by labor shortages, turnover, and labor cost increases. We employ approximately 117,000 persons, and our operations depend on the services of a large and diverse workforce. We must attract, train, and retain a large and growing number of qualified employees while controlling related labor costs.
The Company works to develop an increasingly inclusive culture, where individuals from all backgrounds are equally able to contribute and are provided with opportunities to grow in their careers. Guided by ABM’s mission and values and aligned with its ELEVATE strategy, the Company’s inclusive culture strategy is activated through its Culture & Inclusion Council.
The Company works to develop an increasingly inclusive culture, where individuals from all backgrounds are equally able to contribute and are provided with opportunities to grow in their careers. Guided by ABM’s mission and values, the Company’s inclusive culture strategy is activated through its Culture & Inclusion Council.
Additionally, we are an Equal Opportunity and Affirmative Action employer in compliance with the requirements of the Executive Order 11246 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans’ Readjustment Assistance Act. 8 Available Information Our corporate website is www.abm.com.
Additionally, ABM is an Equal Opportunity and Affirmative Action employer in compliance with the requirements of the Executive Order 11246 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans’ Readjustment Assistance Act. 8 Available Information Our corporate website is www.abm.com.
Rene Jacobsen 62 Executive Vice President and Chief Operating Officer of ABM since November 2020; Executive Vice President and Chief Facilities Services Officer of ABM from October 2019 to November 2020; President of ABM’s Business & Industry Group from February 2016 to October 2019; Executive Vice President of ABM’s West Region from April 2012 to February 2016; Executive Vice President and Chief Operating Officer of Temco Service Industries from November 2007 to April 2012.
Rene Jacobsen 63 Executive Vice President and Chief Operating Officer of ABM since November 2020; Executive Vice President and Chief Facilities Services Officer of ABM from October 2019 to November 2020; President of ABM’s Business & Industry Group from February 2016 to October 2019; Executive Vice President of ABM’s West Region from April 2012 to February 2016; Executive Vice President and Chief Operating Officer of Temco Service Industries from November 2007 to April 2012.
Dean A. Chin 55 Treasurer of ABM since May 2021; Senior Vice President, Chief Accounting Officer, and Corporate Controller of ABM since June 2010; Interim Chief Financial Officer of ABM from July 2020 to November 2020; Vice President and Assistant Controller of ABM from June 2008 to June 2010. 9 ITEM 1A. RISK FACTORS.
Dean A. Chin 56 Treasurer of ABM since May 2021; Senior Vice President, Chief Accounting Officer, and Corporate Controller of ABM since June 2010; Interim Chief Financial Officer of ABM from July 2020 to November 2020; Vice President and Assistant Controller of ABM from June 2008 to June 2010. 9 ITEM 1A. RISK FACTORS.
Further, potential declines in economic conditions could result in depressed prices for our services, which could affect our financial condition. We offer a portfolio of capital projects, which are designed to reduce a client’s overall consumption of commodities, such as electricity and natural gas. Downward fluctuations in commodity prices, and/or elevated interest rates, may reduce client demand for such projects.
Further, potential declines in economic conditions could result in depressed prices for our services, which could affect our financial condition. We offer a portfolio of capital projects, which are designed to reduce a client’s overall consumption of energy, such as electricity and natural gas. Downward fluctuations in energy prices, and/or elevated interest rates, may reduce client demand for such projects.
Such disruption could adversely affect our profitability and reputation. Additionally, any disruption could negatively impact the effectiveness of our controls. Refer to “Risk Relating to Financial Matters” below for further information on the internal controls.
Such disruption could adversely affect our profitability and reputation. Additionally, any disruption could negatively impact the effectiveness of our controls. Refer to “Risks Relating to Financial Matters” below for further information on the internal controls.
Inc. from January 2018 to November 2020; Chief Financial Officer of Best Buy Canada from May 2016 to December 2017; Vice President, Finance, Retail of Canadian Tire Corporation Limited from May 2014 to May 2016. Joshua H.
Inc. from January 2018 to November 2020; Chief Financial Officer of Best Buy Canada from May 2016 to December 2017; Vice President, Finance, Retail of Canadian Tire Corporation Limited from May 2014 to May 2016.
The execution of this strategy is overseen at the highest levels of our organization, from our Board of Directors, our Board of Directors’ Stakeholder and Enterprise Risk Committee, and across our senior management . Business ethics Our Code of Business Conduct drives the application of our core values of respect, integrity, collaboration, innovation, trust, and excellence throughout our operations.
The execution of our human capital strategy is overseen at the highest levels of our organization, from our Board of Directors, our Board of Directors’ Stakeholder and Enterprise Risk Committee, and across our senior management. Business ethics Our Code of Business Conduct drives the application of our core values of respect, integrity, collaboration, innovation, trust, and excellence throughout our operations.
Risks Relating to Market and Economic Conditions Decreases in commercial office space utilization due to hybrid work models could adversely affect our financial condition. A key part of our business involves providing janitorial, facilities engineering, and parking services for commercial office building properties.
Risks Relating to Market and Economic Conditions Decreases in commercial office space utilization due to hybrid work models and increases in office vacancy rates could adversely affect our financial condition. A key part of our business involves providing janitorial, facilities engineering, and parking services for commercial office building properties.
Sean M. Mahoney 57 Executive Vice President and President, Sales and Marketing of ABM since November 2020; Senior Vice President, Sales of ABM from August 2017 to October 2020; Vice President, Sales of Honeywell from July 2015 to July 2017. Andrea R.
Sean M. Mahoney 58 Executive Vice President and President, Sales and Marketing of ABM since November 2020; Senior Vice President, Sales of ABM from August 2017 to October 2020; Vice President, Sales of Honeywell from July 2015 to July 2017. Andrea R.
Our business is subject to a complicated set of federal, state, and local laws and regulations as well as stakeholder views addressing, among other things, wage and hour standards, employment and labor relations, ESG-related practices, leave of absence, cybersecurity, data privacy and protection, occupational health and safety, environmental matters, anti-competition, anti-corruption, and government contracting.
Our business is subject to a complicated set of federal, state, and local laws and regulations as well as stakeholder views addressing, among other things, wage and hour standards, employment and labor relations, various Corporate Responsibility-related practices, leave of absence, cybersecurity, data privacy and protection, occupational health and safety, environmental matters, anti-competition, anti-corruption, and government contracting.
Earl R. Ellis 58 Executive Vice President and Chief Financial Officer of ABM since November 2020; Senior Vice President, Finance and Procurement of Best Buy Co.
Earl R. Ellis 59 Executive Vice President and Chief Financial Officer of ABM since November 2020; Senior Vice President, Finance and Procurement of Best Buy Co.
The failure to make timely and accurate contributions as a result of a systems failure could have a negative impact on our financial position. At October 31, 2023, approximately 37% of our employees were subject to various local collective bargaining agreements, some of which will expire or become subject to renegotiation during 2024.
The failure to make timely and accurate contributions as a result of a systems failure could have a negative impact on our financial position. At October 31, 2024, approximately 42% of our employees were subject to various local collective bargaining agreements, some of which will expire or become subject to renegotiation during 2025.
Dependence on Significant Client No single client accounted for more than 10% of our consolidated revenues during 2023, 2022, or 2021.
Dependence on Significant Client No single client accounted for more than 10% of our consolidated revenues during 2024, 2023, or 2022.
We typically provide these services pursuant to monthly fixed-price, square-foot, and cost-plus, that are obtained through a competitive bid process as well as pursuant to work orders. One client accounted for approximately 32% of revenues for this segment in 2023.
We typically provide these services pursuant to monthly fixed-price, square-foot, and cost-plus, that are obtained through a competitive bid process as well as pursuant to work orders. One client accounted for approximately 31% of revenues for this segment in 2024.
Energy Savings Contracts and Fixed-Price Repair and Refurbishment Under these arrangements, we agree to develop, design, engineer, and construct a project. Additionally, as part of bundled energy solutions arrangements, we guarantee the project will satisfy agreed-upon performance standards. The client agrees to pay us based on s predetermined contractual milestone schedule.
Energy Savings Contracts and Fixed-Price Repair and Refurbishment Under these arrangements, we agree to develop, design, engineer, and construct various types of energy saving projects. Additionally, as part of bundled energy solutions arrangements, we guarantee the project will satisfy agreed-upon performance standards. The client agrees to pay us based on a predetermined contractual milestone schedule.
Executive Officers of Registrant Executive Officers on December 18, 2023 Name Age Principal Occupations and Business Experience Scott Salmirs 61 President and Chief Executive Officer of ABM since March 2015; Executive Vice President of ABM from September 2014 to March 2015, with global responsibility for ABM’s Aviation division and all international activities; Executive Vice President of ABM’s Onsite Services division focused on the Northeast from 2003 to September 2014; Member of the Board of Directors of ABM since January 2015.
Executive Officers of Registrant Executive Officers on December 19, 2024 Name Age Principal Occupations and Business Experience Scott Salmirs 62 President and Chief Executive Officer of ABM since March 2015; Executive Vice President of ABM from September 2014 to March 2015, with global responsibility for ABM’s Aviation division and all international activities; Executive Vice President of ABM’s Onsite Services division focused on the Northeast from 2003 to September 2014; Member of the Board of Directors of ABM since January 2015.
Our Code of Business Conduct serves as a critical tool to help all ABM team members to recognize and report unethical conduct, while preserving and nurturing our culture of honesty and accountability. We provide comprehensive annual training and certification programs on our Code of Business Conduct for our Board of Directors and all of our staff and management employees.
Our Code of Business Conduct serves as a critical tool to help all ABM team members to recognize and report unethical conduct, while preserving and nurturing our culture of honesty and accountability. The Company provides comprehensive annual training and certification programs on our Code of Business Conduct for our Board of Directors and all of our staff and management employees.
More information about our ESG performance, progress, and goals can be found in the Human Capital section of this report and in the ESG section of the Company’s corporate website.
More information about our sustainability performance, progress, and goals can be found in the Human Capital section of this report and in the Corporate Responsibility section of the Company’s corporate website.
Newborn 60 Executive Vice President, General Counsel, and Corporate Secretary of ABM since July 2017; Executive Vice President and General Counsel of TravelClick, Inc. from July 2014 to June 2017; Senior Vice President, General Counsel, and Secretary of The Reader’s Digest Association, Inc. from March 2007 to February 2014.
Newborn 61 Executive Vice President and General Counsel of ABM since 2017; Corporate Secretary of ABM from July 2017 to October 2024; Executive Vice President and General Counsel of TravelClick, Inc. from July 2014 to June 2017; Senior Vice President, General Counsel, and Secretary of The Reader’s Digest Association, Inc. from March 2007 to February 2014.
Such rate increases have corresponding impact to our costs of borrowing and may have an adverse impact on our ability to raise funds through the offering of our securities or through the issuance of debt due to higher debt capital costs, diminished credit availability, and less favorable equity markets.
Any future interest rate increases would have corresponding impact to our costs of borrowing and may have an adverse impact on our ability to raise funds through the offering of our securities or through the issuance of debt due to higher debt capital costs, diminished credit availability, and less favorable equity markets.
Raúl Valentin 60 Executive Vice President and Chief Human Resources Officer of ABM since September 2021; Senior Vice President, Human Resources of ABM from February 2019 to August 2021; Senior Vice President, Human Resources of Coty Inc. from 2016 to 2018; Vice President, Human Resources of Comcast Strategic & Business Development from 2015 to 2016; Vice President, Talent Acquisition of Comcast from 2011 to 2015.
Raúl Valentín 61 Executive Vice President and Chief Human Resources Officer of ABM since September 2021; Senior Vice President, Human Resources of ABM from February 2019 to August 2021; Senior Vice President, Human Resources of Coty Inc. from 2016 to 2018; Vice President, Human Resources of Comcast Strategic & Business Development from 2015 to 2016; Vice President, Talent Acquisition of Comcast from 2011 to 2015.
Environmental, Social, and Governance (“ESG”) Strategy and Oversight As a company with over 110 years of history we understand the importance of embedding and integrating responsible and community-minded business practices into our operations and commit to standards to create value and support the long-term success of our business, shareholders, employees, and clients.
Corporate Responsibility Strategy and Oversight As a company with over 110 years of history, we understand the importance of embedding and integrating responsible and community-minded business practices into our operations and commit to standards to create value and support the long-term success of our business, shareholders, employees, and clients.
In addition, we expect there will likely be increasing levels of regulation, disclosure-related and otherwise, with respect to ESG matters, and increased regulation will likely lead to increased compliance costs as well as scrutiny that could heighten all of the risks identified in this risk factor.
In addition, we expect there will likely be increasing and evolving levels of regulation, disclosure-related and otherwise, with respect to Corporate Responsibility (including environmental) matters, and increased regulation will likely lead to increased compliance costs as well as scrutiny that could heighten all of the risks identified in this risk factor.
Since 2011, we have voluntarily published an ESG Impact Report on an annual basis in alignment with the Global Reporting Initiative framework and the Sustainability Accounting Standards Board to address our business, our employees, and the environment.
Since 2011, we have voluntarily published a Corporate Responsibility Report on an annual basis in alignment with the Global Reporting Initiative framework and the Sustainability Accounting Standards Board to address our business, our employees, and the environment.
Continued labor shortages or increased turnover rates within our employee base could lead to increased costs, such as increased overtime incurred and/or increased usage of temporary labor to meet the demands of our customers, as well as increased wage rates to attract and retain employees.
Meaningful labor shortages, inflationary pressures on wages, and/or increased turnover rates within our employee base could lead to increased costs, such as increased overtime incurred and/or increased usage of temporary labor to meet the demands of our customers, as well as increased wage rates to attract and retain employees.
Furthermore, while we continue to devote significant resources to monitoring and updating our systems and implementing information security measures to protect our systems, there can be no assurance that the controls and procedures we have in place will be sufficient to protect us from future security breaches.
Furthermore, while we continue to devote significant resources to monitoring and updating our systems and implementing information security measures to protect our systems, there can be no assurance that the controls and procedures we have in place will be sufficient to protect us from future security breaches. Emerging artificial intelligence technologies may intensify these cybersecurity risks.
Direct labor costs represented 69% of our total revenue for 2023. As of October 31, 2023, we employed approximately 123,000 employees, of whom approximately 46,000, or 37%, were subject to various local collective bargaining agreements. As of October 31, 2023, our frontline employees represented 92% of our total workforce, while staff and management employees represented the other 8%.
Direct labor costs represented 68% of our total revenue for 2024. As of October 31, 2024, we employed approximately 117,000 employees, of whom approximately 49,000, or 42%, were subject to various local collective bargaining agreements. As of October 31, 2024, our frontline employees represented 92% of our total workforce, while staff and management employees represented the other 8%.
ABM’s President and CEO and Chief Human Resources Officer each serve as executive sponsors of the Culture & Inclusion Council, and reports of Culture & Inclusion Council activities are provided to the Board’s Stakeholder and Enterprise Risk Committee.
ABM’s President and CEO and Chief Human Resources Officer each serve as executive sponsors of the Council, which provides regular reports to the Board’s Stakeholder and Enterprise Risk Committee.
The addition of Momentum provided greater access to Momentum’s blue-chip customer base as well as an opportunity to cross sell ABM services to existing U.S.- and UK-based clients who also have an operational footprint in Ireland and Northern Ireland.
In 2022, we acquired Momentum Support (“Momentum”), a leading independent provider of facility services, primarily janitorial, across Ireland and Northern Ireland. The addition of Momentum provided greater access to Momentum’s blue-chip customer base as well as an opportunity to cross sell ABM services to existing U.S.- and UK-based clients who also have an operational footprint in Ireland and Northern Ireland.
Compensation and employee benefits In addition, we offer competitive wages and salaries in our served markets and full-time employees have access to a continuum of health and wellness benefits, including medical, dental, vision, disability, and basic life and voluntary supplemental life and AD&D insurance, 401K employee savings and employee stock purchase programs, a 24/7 employee assistance program, healthcare flexible spending accounts, telemedicine options, legal support, as well as commuter, fitness, and other discount programs. 7 Labor relations With approximately 46,000 union-represented employees, we are party to more than 250 collective bargaining agreements nationwide, with 20 major labor unions.
Compensation and employee benefits In addition, we offer competitive wages and salaries in our served markets, and full-time employees have access to a continuum of health and wellness benefits, including medical, dental, vision, disability, and basic and voluntary life and AD&D insurance, 401K employee savings and an employee stock purchase plan, a 24/7 employee assistance program, healthcare flexible spending accounts, telemedicine options, legal support, as well as commuter, fitness, and other discount programs.
Human resources, hiring, and training With a team of approximately 123,000 employees across the United States, UK, Ireland, and other locations, we have invested in and implemented a variety of systems and tools designed to centralize and standardize hiring and training practices, including regional recruitment strategies, applicant tracking technology, and incorporating modeling and advanced analytics that provide actionable insights relative to the candidate life cycle and turnover trends in our HR processes to drive ongoing improvement in the attraction, retention, and engagement of our frontline employees, who constitute the majority of our workforce.
Human resources, hiring, and training With a team of approximately 117,000 employees across the United States, UK, Ireland, and other locations, we have invested in and implemented a variety of systems and tools designed to centralize and standardize hiring and training practices, including regional recruitment strategies, applicant tracking technology, and advanced analytics that provide actionable insights in our HR processes.
Our human capital strategy is grounded and guided by our values and our employees. We prioritize our human capital development in order to do business in a responsible way and enable our employees’ and clients’ success.
Our human capital strategy is guided by our values and advanced by our employees. We prioritize doing business in a responsible way and enabling our employees’ and clients’ success.
We utilize multiple platforms and ERP systems to record transactions, provide information to management, and prepare our financial statements. We are in the process of transitioning our ERP and other key boundary systems. This transition began in the third quarter of 2023 and will continue for the next couple of years.
We utilize multiple platforms and ERP systems to record transactions, provide information to management, and prepare our financial statements. We are in the process of transitioning our ERP and other key boundary systems.
Risks Relating to Information Technology and Cybersecurity We may experience breaches of, or disruptions to, our information technology systems or those of our third-party providers or clients, or other compromises of our data that could adversely affect our business.
All of these factors could have an adverse effect on our financial condition, results of operations, and cash flows. Risks Relating to Information Technology and Cybersecurity We may experience breaches of, or disruptions to, our information technology systems or those of our third-party providers or clients, or other compromises of our data that could adversely affect our business.
In 2017, we acquired GCA Services Group (“GCA”), a provider of integrated facility services to educational institutions and commercial facilities, for approximately $1.3 billion, representing the largest acquisition in ABM history. The acquisition accelerated the Company’s position as a leading facility solutions provider in the education market. In 2021, we acquired Crown Building Maintenance Co. and Crown Energy Services, Inc.
In 2017, we acquired GCA Services Group (“GCA”), a provider of integrated facility services to educational institutions and commercial facilities, for approximately $1.3 billion, representing the largest acquisition in ABM history.
Our Board of Directors receives regular reports from meetings of its Governance Committee, which is responsible for oversight of the Company’s overall ESG-related framework, as well as from meetings of its Stakeholder and Enterprise Risk Committee, which is responsible for oversight of environmental and social matters within ESG.
Our Board of Directors receives regular reports from meetings of its Governance Committee, which is responsible for oversight of the Company’s corporate governance and overall corporate 6 responsibility-related framework, as well as from meetings of its Stakeholder and Enterprise Risk Committee, which is responsible for oversight of the Company’s programs, policies, and practices relating to social and environmental matters that may impact the Company’s business and key stakeholders.
Additionally, there are risks to all employers in some states, such as California, resulting from new and unanticipated judicial interpretations of existing laws and the application of those new interpretations against employers on a retroactive basis.
Additionally, there are risks to all employers in some states, such as California, resulting from large collective, class, Private Attorneys General Act actions, as well as from new and unanticipated judicial interpretations of existing laws and the application of those new interpretations against employers on a retroactive basis, which could involve substantial claims and significant defense costs.
Safe working environment ABM’s commitment to its team members is evidenced in its approach to risk management and safety. The Company’s programs are designed to meet or exceed compliance standards of the Occupational Safety and Health Administration and other regulatory bodies, and to protect the health and welfare of our employees and our clients.
The Company’s programs are designed to meet or exceed compliance standards of the Occupational Safety and Health Administration and other regulatory bodies and to protect the health and welfare of our employees and our clients.
Because of the nature of multiemployer pension plans, there are risks to us associated with participation in these plans that differ from single-employer plans. Assets contributed by an employer to a multiemployer pension plan are not segregated into a separate account and are not restricted to provide benefits only to employees of that contributing employer.
Assets contributed by an employer to a multiemployer pension plan are not segregated into a separate account and are not restricted to provide benefits only to employees of that contributing employer.
Risks Relating to Financial Matters Future increases in the level of our borrowings or in interest rates could affect our results of operations. The Federal Reserve Board increased interest rates in 2022 and 2023, and these increases may continue in 2024 and beyond.
Risks Relating to Financial Matters Future increases in the level of our borrowings and interest rates could affect our results of operations.
Contracts for this segment are generally structured as electrical contracting services for energy related products such as the installation of solar solutions, battery storage, distributed generation, and other specialized electric trade.. 5 Service Marks, Trademarks, and Trade Names We hold various service marks, trademarks, and/or trade names, such as “ABM,” “ABM Building Value,” “ABM GreenCare,” “ABM EnhancedClean,” “ABM EnhancedFacility,” “Linc Service,” “TEGG,” “ABM Connect,” “ABM Vantage,” “Momentum Support Services,” and “RavenVolt,” which we deem important to our marketing activities, to our business, and, in some cases, to the franchising activities conducted by our Technical Solutions segment.
One client accounted for approximately 22% of revenues for this segment in 2024. 5 Service Marks, Trademarks, and Trade Names We hold various service marks, trademarks, and/or trade names, such as “ABM,” “ABM Building Value,” “ABM GreenCare,” “ABM EnhancedClean,” “ABM EnhancedFacility,” “Linc Service,” “TEGG,” “ABM Connect,” “ABMVantage,” and “RavenVolt,” which we deem important to our marketing activities, to our business, and, in some cases, to the franchising activities conducted by our Technical Solutions segment.
The sales and marketing teams acquire, nurture, and manage leads through the sales buying process, as well as train personnel on product offerings, sales tools, and proposal systems, all governed by standard operating procedures. Macro-Economic Environment in Commercial Real Estate We actively monitor the economic environment and its potential impact on demand for our services and our financial condition.
The sales and marketing teams acquire, nurture, and manage leads through the sales buying process, as well as train personnel on product offerings, sales tools, and proposal systems, all governed by standard operating procedures.
Franchise We franchise certain engineering services through individual and area franchises under the Linc Service and TEGG brands, which are part of ABM Technical Solutions. Microgrid Systems Installation Under these arrangements, we provide electrical contracting services for energy related products such as the installation of solar solutions, battery storage, distributed generation, and other specialized electric trades.
Microgrid and Uninterrupted Power Supply Systems Installation Under these arrangements, we provide electrical contracting services for energy-related products such as the installation of solar solutions, battery storage, distributed generation, UPS service and maintenance, battery and power distribution unit service and maintenance, and other specialized electric trades.
In 2021, we successfully piloted a frontline leadership training program, which was launched enterprise-wide in 2022 and expanded further in 2023. This program is designed to enhance the management and coaching skills of frontline supervisors to improve the employee experience, create an environment for career growth, and increase retention.
This program is designed to enhance the management and coaching skills of frontline supervisors to improve the employee experience, create an environment for career growth, and increase retention. In 2024, we re-launched our Leadership Academy designed for middle- and senior-level leaders from across the enterprise.
Given that Class A and high-quality commercial office buildings are a key end market for the Company, we expect a decline in demand for janitorial services and work orders in these markets near-term. Longer term, we expect the vacancy rates of Class A and high-quality buildings to gradually decrease and our volume of work to stabilize.
Given that Class A and high-quality commercial office buildings are a key end market for us, we have experienced modest declines in demand for janitorial services and work orders in these markets. We expect the occupancy rates of Class A and high-quality buildings and back-to office trends to improve throughout 2025.
In 2022, we acquired RavenVolt, Inc. (“RavenVolt”), a leading nationwide provider of advanced turn-key microgrid systems utilized by diversified commercial and industrial customers, national retailers, utilities, and municipalities.
In 2022, we acquired RavenVolt, Inc. (“RavenVolt”), a leading nationwide provider of advanced turn-key microgrid systems utilized by diversified commercial and industrial customers, national retailers, utilities, and municipalities. A complementary extension of ABM’s Technical Solutions service offerings, the addition of RavenVolt enhanced ABM’s position as a market leader in electric vehicle (“EV”) charging infrastructure, power, and bundled energy solutions.
Additionally, our internal culture, sustainability, diversity, equity and inclusion teams work 6 in cross functional collaboration with departments throughout and across the enterprise to advance our ESG strategies, and regularly present to the Board of Directors’ Stakeholder and Enterprise Risk Committee.
Additionally, our internal culture, environmental sustainability, and inclusion efforts are led by cross functional teams that include employees across the enterprise, and are aimed to advance our corporate responsibility strategies, and regularly present to the Board of Directors’ Stakeholder and Enterprise Risk Committee.
In furtherance of our business strategy, we routinely evaluate opportunities and may enter into agreements for possible acquisitions, divestitures, or other strategic transactions. A significant portion of our growth has been generated by acquisitions, and we may continue to acquire businesses in the future as part of our growth strategy.
A significant portion of our growth has been generated by acquisitions, and we may continue to acquire businesses in the future as part of our growth strategy. However, we may encounter challenges identifying opportunities in a timely manner or on terms acceptable to us.
As existing clients decrease office space, the areas that we service for those clients decreases as does the demand for our highly profitable supplemental services (“work orders”) requested by our clients outside the scope of our standard service specifications.
Reduced office occupancies and any further deterioration in vacancy levels would likely decrease the demand for our facility services as well as 11 the demand for highly profitable supplemental services (“work orders”) requested by our clients outside the scope of our standard service specifications.
All of these factors could have an adverse effect on our financial condition, results of operations, and cash flows. Risks Relating to Acquisitions, Divestitures, or Strategic Transactions Acquisitions, divestitures, and other strategic transactions could fail to achieve financial or strategic objectives, disrupt our ongoing business, and adversely impact our results of operations.
Risks Relating to Acquisitions, Divestitures, or Strategic Transactions Acquisitions, divestitures, and other strategic transactions could fail to achieve financial or strategic objectives, disrupt our ongoing business, and adversely impact our results of operations. In furtherance of our business strategy, we routinely evaluate opportunities and may enter into agreements for possible acquisitions, divestitures, or other strategic transactions.
Our collective bargaining agreements include regional multiemployer agreements covering thousands of employees, as well as localized site agreements covering smaller groups. We strive to engage with our labor partners in an atmosphere of mutual respect, and seek to resolve disputes in a fair and equitable manner.
We strive to engage with our labor partners in an atmosphere of mutual respect, and seek to resolve disputes in a fair and equitable manner. Safe working environment ABM’s commitment to its employees is evidenced in its approach to risk management and safety.
One client accounted for approximately 18% of revenues for this segment in 2023. Technical Solutions specializes in facility infrastructure, mechanical and electrical services, including EV power design, installation and maintenance, as well as microgrid systems design and installation. These services can also be leveraged for cross-selling across all of our industry groups, both domestically and internationally.
Two clients accounted for approximately 26% of revenues for this segment in 2024. Technical Solutions specializes in facility infrastructure, mechanical and electrical services, EV power design, installation and maintenance, microgrid systems design, installation and maintenance, including uninterrupted power supply system and power distribution units.
Our online training platform, ABM University, provides our staff and management employees with access to a multitude of training courses, videos, reference material, and other tools. Outside of ABM University, our frontline employees receive on-the-job training to enable us to execute for our clients in a safe and efficient manner.
Additionally, our frontline employees 7 receive on-the-job training specific to their role and location to enable us to deliver for our clients in a safe and efficient manner.
Removed
A complementary extension of ABM’s Technical Solutions service offerings, the addition of RavenVolt enhanced ABM’s position as a market leader in electric vehicle (“EV”) charging infrastructure, power, and bundled energy solutions. 2 In 2022, we acquired Momentum Support (“Momentum”), a leading independent provider of facility services, primarily janitorial, across Ireland and Northern Ireland.
Added
The acquisition accelerated the Company’s position as a leading facility solutions provider in the education market. 2 In 2021, we acquired Crown Building Maintenance Co. and Crown Energy Services, Inc.
Removed
Largely driven by the lingering effects of the pandemic, especially the normalization of hybrid work, the commercial real estate industry, particularly multi-tenant and owner-occupied commercial office buildings, is experiencing an increase in vacancy rates.
Added
In 2024, we acquired Quality Uptime Services, Inc. (“Quality Uptime”), an independent uninterrupted power supply system (“UPS”) maintenance company providing customized preventive and emergency service programs for mission-critical data centers and other facilities across the United States.
Removed
Our Board of Directors and its committees are responsible for overseeing the Company’s activities and practices relating to ESG.
Added
With the addition of Quality Uptime, we will offer comprehensive and complementary critical infrastructure solutions for data centers and similar crucial facilities, including electrical testing, electrical switchgear maintenance, breaker testing, UPS service and maintenance, and battery and power distribution unit service and maintenance.
Removed
Feinberg 49 Executive Vice President, Chief Strategy and Transformation Officer of ABM since November 2019; Managing Director and Partner of The Boston Consulting Group from July 2014 to November 2019.
Added
Franchise We franchise certain engineering services through individual and area franchises under the Linc Service and TEGG brands, which are part of ABM Technical Solutions.
Removed
During 2023, we continued to be impacted by labor shortages, inflationary pressures on wages, and an increasingly competitive labor market.
Added
These services can also be leveraged for cross-selling across all of our industry groups, both domestically and internationally. Contracts for this segment are generally structured as electrical contracting services for energy related products such as the installation of solar solutions, battery storage, distributed generation, and other specialized electric trade.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

85 edited+23 added−25 removed49 unchanged
Biggest changeThe decrease in selling, general and administrative expenses was primarily attributable to: • a $45.6 million decrease in the fair value of contingent consideration related to the RavenVolt Acquisition; • a $24.0 million benefit from ERC refunds received; and 24 • a $6.6 million decrease in certain technology projects primarily attributable to discrete transformational costs under our ELEVATE strategy for developing the new ERP system, client-facing technology, workforce management tools, and data analytics; This decrease was partially offset by: • a $10.8 million increase in bad debt, of which $7.7 million relates to a favorable adjustment in the prior year; • an absence of a $7.6 million gain on the sale of a group of customer contracts related to healthcare technology management services within Technical Solutions during 2022; and • a $4.6 million increase in unfavorable self-insurance adjustment related to prior year claims as the result of actuarial evaluations completed on our medical and dental self-insurance plans.
Biggest changeThe increase in corporate expenses was primarily related to: • a $95.7 million fair value adjustment to increase the contingent consideration related to the RavenVolt Acquisition recorded during 2024, as compared to a $45.6 million fair value adjustment to decrease the contingent consideration recorded during 2023; • a $20.3 million unfavorable self-insurance reserve adjustment related to prior year claims from actuarial evaluations completed during 2024, as compared to a favorable $14.8 million adjustment recorded in 2023; • a $24.3 million increase in costs associated with various systems’ go-live and other investments in technology; and • an absence of a $24.0 million benefit from employee retention credits received during 2023.
The change was primarily related to a decrease in net borrowings from our Amended Credit Facility, as in 2022 we had higher borrowings to fund Momentum and RavenVolt acquisitions, and higher share repurchases in 2023.
The change was primarily related to a decrease in net borrowings from our Amended Credit Facility, as in 2022 we had higher borrowings to fund the Momentum and RavenVolt acquisitions and higher share repurchases in 2023.
While U.S. federal tax expense has been recognized as a result of the Tax Cuts and Jobs Act of 2017, no deferred tax liabilities with respect to federal and state income taxes or foreign withholding taxes have been recognized.
While U.S. federal tax expense has been recognized as a 31 result of the Tax Cuts and Jobs Act of 2017, no deferred tax liabilities with respect to federal and state income taxes or foreign withholding taxes have been recognized.
We believe the following critical accounting policies govern the more significant judgments and estimates used in the preparation of our Financial Statements. 34 Description Judgments and Uncertainties Effect if Actual Results Differ from Assumptions Valuation of Long-Lived Assets We evaluate our fixed assets and amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.
We believe the following critical accounting policies govern the more significant judgments and estimates used in the preparation of our Financial Statements. 36 Description Judgments and Uncertainties Effect if Actual Results Differ from Assumptions Valuation of Long-Lived Assets We evaluate our fixed assets and amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.
Neither of these arrangements has a material current effect, or is reasonably likely to have a material future effect, on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources. 33 Critical Accounting Policies and Estimates The preparation of consolidated financial statements in accordance with United States generally accepted accounting principles (“U.S.
Neither of these arrangements has a material current effect, or is reasonably likely to have a material future effect, on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources. 35 Critical Accounting Policies and Estimates The preparation of consolidated financial statements in accordance with United States generally accepted accounting principles (“U.S.
Our principal operations are in the United States, and in 2023 our U.S. operations generated approximately 93% of our revenues. Strategic Growth We remain focused on long-term, profitable growth by delivering valued service offerings to both new and existing clients within our industry groups and across our many service lines.
Our principal operations are in the United States, and in 2024 our U.S. operations generated approximately 93% of our revenues. Strategic Growth We remain focused on long-term, profitable growth by delivering valued service offerings to both new and existing clients within our industry groups and across our many service lines.
Debt Facilities On September 1, 2017, we refinanced and replaced our then-existing $800.0 million credit facility with a new senior, secured five-year syndicated credit facility (the “Credit Facility”), consisting of a $900.0 million revolving line of credit and an $800.0 million amortizing term loan.
Credit Facility On September 1, 2017, we refinanced and replaced our then-existing $800.0 million credit facility with a new senior, secured five-year syndicated credit facility (the “Credit Facility”), consisting of a $900.0 million revolving line of credit and an $800.0 million amortizing term loan.
In addition to normal working capital requirements, we anticipate that our short- and long-term cash requirements will include funding insurance claims, dividend payments, capital expenditures, share repurchases, mandatory loan repayments, and systems and technology transformation initiatives under our ELEVATE strategy. We anticipate long-term cash uses may also include strategic acquisitions.
In addition to normal working capital requirements, we anticipate that our short- and long-term cash requirements will include funding insurance claims, dividend payments, capital expenditures, share repurchases, mandatory loan repayments, contingent consideration payments from acquisitions, and systems and technology transformation initiatives under our ELEVATE strategy. We anticipate long-term cash uses may also include strategic acquisitions.
See Note 11, “Debt,” in the Financial Statements for further detail of our debt and the timing of expected future principal and interest payments. • Operating and Finance Leases – We enter into various noncancelable l ease agreements for office space, parking facilities, warehouses, vehicles, and equipment used in the normal course of business.
See Note 11, “Credit Facility,” in the Financial Statements for further detail of our debt and the timing of expected future principal and interest payments. 33 • Operating and Finance Leases – We enter into various noncancelable l ease agreements for office space, parking facilities, warehouses, vehicles, and equipment used in the normal course of business.
The Year Ended October 31, 2022, Compared with the Year Ended October 31, 2021 For a comparison of our Results of Operations for the year ended October 31, 2022, to the year ended October 31, 2021, see “Part II, Item 7.
The Year Ended October 31, 2023, Compared with the Year Ended October 31, 2022 For a comparison of our Results of Operations for the year ended October 31, 2023, to the year ended October 31, 2022, see “Part II, Item 7.
The Year Ended October 31, 2022, Compared with the Year Ended October 31, 2021 For a comparison of our Segment Information for the year ended October 31, 2022, to the year ended October 31, 2021, see “Part II, Item 7.
The Year Ended October 31, 2023, Compared with the Year Ended October 31, 2022 For a comparison of our Segment Information for the year ended October 31, 2023, to the year ended October 31, 2022, see “Part II, Item 7.
We have future interest payments based on our hedged borrowings under our Amended Credit Facility of $16.8 million, which is payable within 12 months. The interest payments on our remaining borrowings under the Amended Credit Facility will be determined based upon the average outstanding balance of our borrowings and the prevailing interest rate during that time.
We have future interest payments based on our hedged borrowings under our Amended Credit Facility of $15.7 million, which is payable within 12 months. The interest payments on our remaining borrowings under the Amended Credit Facility will be determined based upon the average outstanding balance of our borrowings and the prevailing interest rate during that time.
See Note 12, “Employee Benefit Plans,” in the Financial Statements for more information. • Self-Insurance Obligations – We may make payments for exposures for which we are self-insured, including workers’ compensation, general liability, automobile liability, property damage, and other insurable risks. At October 31, 2023, our self-insurance reserves, net of recoverables, were $487.9 million.
See Note 12, “Employee Benefit Plans,” in the Financial Statements for more information. • Self-Insurance Obligations – We may make payments for exposures for which we are self-insured, including workers’ compensation, general liability, automobile liability, property damage, and other insurable risks. At October 31, 2024, our self-insurance reserves, net of recoverables, were $517.3 million.
We had contractual payments for these arrangements of $88.2 million, with $25.0 million payable within 12 months. • Information Technology Service Agreement s – Information technology service agreements represent outsourced services and licensing costs pursuant to our information technology agreements.
We had contractual payments for these arrangements of $71.4 million, with $25.0 million payable within 12 months. • Information Technology Service Agreement s – Information technology service agreements represent outsourced services and licensing costs pursuant to our information technology agreements.
During 2023, 2022, and 2021, contributions made to these plans were $574.6 million, $555.1 million, and $348.8 million, respectively; however, our future contributions to the multiemployer plans are dependent upon a number of factors, including the funded status of the plans, the ability of other participating companies to meet ongoing funding obligations, and the level of our ongoing participation in these plans.
During 2024, 2023, and 2022, contributions made to these plans were $565.9 million, $574.6 million, and $555.1 million, respectively; however, our future contributions to the multiemployer plans are dependent upon a number of factors, including the funded status of the plans, the ability of other participating companies to meet ongoing funding obligations, and the level of our ongoing participation in these plans.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Form 10-K for the fiscal year ended October 31, 2022, filed with the SEC on December 21, 2022. 25 Segment Information Our current reportable segments consist of B&I, M&D, Education, Aviation, and Technical Solutions.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Form 10-K for the fiscal year ended October 31, 2023, filed with the SEC on December 18, 2023. 26 Segment Information Our current reportable segments consist of B&I, M&D, Education, Aviation, and Technical Solutions.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Form 10-K for the fiscal year ended October 31, 2022, filed with the SEC on December 21, 2022. 29 Liquidity and Capital Resources Our primary sources of liquidity are operating cash flows and borrowing capacity under our credit facility.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Form 10-K for the fiscal year ended October 31, 2023, filed with the SEC on December 18, 2023. 30 Liquidity and Capital Resources Our primary sources of liquidity are operating cash flows and borrowing capacity under our credit facility.
Foreign Currency Translation and Other We had a foreign currency translation gain of $7.3 million during the year ended October 31, 2023, as compared to a foreign currency translation loss of $19.8 million during the year ended October 31, 2022. This change was due to fluctuations in the exchange rate between the U.S.
Foreign Currency Translation and Other We had a foreign currency translation gain of $7.5 million during the year ended October 31, 2024, as compared to a foreign currency translation gain of $7.3 million during the year ended October 31, 2023. This change was due to fluctuations in the exchange rate between the U.S.
Material Cash Requirements from Contractual and Other Obligations As of October 31, 2023, our material cash requirements for our known contractual and other obligations were as follows: • Debt Obligations and Interest Payments – Outstanding payments on our Amended Credit Facility were $1,313.8 million, with $32.5 million payable within 12 months.
Material Cash Requirements from Contractual and Other Obligations As of October 31, 2024, our material cash requirements for our known contractual and other obligations were as follows: • Debt Obligations and Interest Payments – Outstanding payments on our Amended Credit Facility were $1,335.3 million, with $32.5 million payable within 12 months.
At October 31, 2023, we had $2.5 billion of goodwill. Our goodwill is included in the following segments: $1.1 billion — B&I $502.2 million — M&D $459.3 million — Education $69.0 million — Aviation $368.0 million — Technical Solutions A goodwill impairment analysis was performed for each of our reporting units on August 1, 2023.
At October 31, 2024, we had $2.6 billion of goodwill. Our goodwill is included in the following segments: $1.1 billion — B&I $502.2 million — M&D $459.3 million — Education $69.4 million — Aviation $449.6 million — Technical Solutions A goodwill impairment analysis was performed for each of our reporting units on August 1, 2024.
We believe that our technology and data investments will enable: the development and deployment of client-facing technology to improve service delivery to our clients; the use of advanced data analytics for sales targeting, employee retention, and recruiting; and the upgrade of our Enterprise Resource Planning and payroll systems. 21 Developments and Trends Macro-Economic Environment in Commercial Real Estate and Other We actively monitor the economic environment and its potential impact on demand for our services and our financial condition.
We believe that our technology and data investments will enable: the development and deployment of client-facing technology to improve service delivery to our clients; the use of advanced data analytics for sales targeting, employee retention, and recruiting; and the upgrade of our Enterprise Resource Planning and payroll systems. 22 Developments and Trends Macro-Economic Environment in Commercial Real Estate and Other On an ongoing basis, we monitor changes to the macro-economic environment and their potential impacts on demand for our services and on our financial condition.
Interest Rate Swaps We had a loss of $0.5 million on interest rate swaps during the year ended October 31, 2023, as compared to a gain of $36.7 million during the year ended October 31, 2022, primarily due to underlying changes in the fair value of our interest rate swaps.
Interest Rate Swaps We had a loss of $22.9 million on interest rate swaps during the year ended October 31, 2024, as compared to a loss of $0.5 million during the year ended October 31, 2023, primarily due to underlying changes in the fair value of our interest rate swaps.
After analyzing recent loss development patterns, comparing the loss development patterns against benchmarks, and applying actuarial projection methods to estimate the ultimate losses, we decreased our total reserves related to prior years known claims as well as our estimate of the loss amounts associated with IBNR Claims during 2023 by $14.8 million.
After analyzing recent loss development patterns, comparing the loss development patterns against benchmarks, and applying actuarial projection methods to estimate the ultimate losses, we increased our total reserves related to prior years for known claims as well as our estimate of the loss amounts associated with IBNR Claims during 2024 by $20.3 million.
See Note 5, “Leases,” in the Financial Statements for further detail of our obligations and the timing of expected future payments. • Service Concession Arrangements – As defined under Topic 853, Service Concession Arrangements , our leased location parking arrangements are represented as service concession arrangements.
See Note 5, “Leases,” in the Financial Statements for further detail of our obligations and the timing of expected future payments. • Service Concession Arrangements – As defined under ASU No. 2017-10, Service Concession Arrangements (Topic 853) : Determining the Customer of the Operation Services , our leased location parking arrangements are represented as service concession arrangements.
We paid total annual dividends of $57.5 million, $51.9 million, and $51.0 million during 2023, 2022, and 2021, respectively.
We paid total annual dividends of $56.5 million, $57.5 million, and $51.9 million during 2024, 2023, and 2022, respectively.
We had contractual payments for these agreements of $122.4 million, with $41.0 million payable within 12 months. • Benefit Obligations – Expected future payments relating to our defined benefit, postretirement, and deferred compensation plans were $38.2 million, with $3.3 million payable in 12 months.
We had contractual payments for these agreements of $117.1 million, with $49.7 million payable within 12 months. • Benefit Obligations – Expected future payments relating to our defined benefit, postretirement, and deferred compensation plans were $38.1 million, with $3.4 million payable in 12 months.
This ASU requires disclosure, on an annual and interim basis, of significant segment expenses that are regularly provided to the chief operating decision maker, and an amount for other segment items by reportable segment, with a description of its composition.
This ASU requires disclosure, on an annual and interim basis, of significant segment expenses that are regularly provided to the chief operating decision maker, and an amount for other segment items by reportable segment, with a description of its composition. We are currently evaluating the impact of implementing this guidance on our financial statements.
Dividends On December 13, 2023, we announced a quarterly cash dividend of $0.225 per share on our common stock, payable on February 5, 2024, to shareholders of record on January 4, 2024. We declared a quarterly cash dividend on our common stock every quarter during 2023, 2022, and 2021.
Dividends On December 5, 2024, we announced a quarterly cash dividend of $0.265 per share on our common stock, payable on February 3, 2025, to shareholders of record on January 2, 2025. We declared a quarterly cash dividend on our common stock every quarter during 2024, 2023, and 2022.
We repurchased shares under the share repurchase program during the year ended October 31, 2023, as summarized below. At October 31, 2023, authorization for $60.3 million of repurchases remained under the Share Repurchase Program.
We repurchased shares under the share repurchase program during the year ended October 31, 2024, as summarized below. At October 31, 2024, authorization for $154.5 million of repurchases remained under the Share Repurchase Program.
See Note 10, “Insurance,” in the Financial Statements for further detail. • Unrecognized Tax Benefits – At October 31, 2023, our total liability for unrecognized tax benefits was $11.6 million.
See Note 10, “Insurance,” in the Financial Statements for further detail. • Unrecognized Tax Benefits – At October 31, 2024, our total liability for unrecognized tax benefits was $7.9 million.
Years Ended October 31, (in millions, except per share amounts) 2023 2022 Total number of shares purchased 3.3 2.3 Average price paid per share (1) $ 41.06 $ 42.15 Total cash paid for share repurchases (1) $ 137.1 $ 97.5 (1) Average price paid per share and total cash paid for share repurchases do not include any excise tax for stock repurchases as part of the Inflation Reduction Act of 2022.
Years Ended October 31, (in millions, except per share amounts) 2024 2023 Total number of shares purchased 1.17 3.34 Average price paid per share (1) $ 47.86 $ 41.06 Total cash paid for share repurchases (1) $ 55.8 $ 137.1 (1) Average price paid per share and total cash paid for share repurchases do not include any excise tax for stock repurchases as part of the Inflation Reduction Act of 2022.
Investing Activities Net cash used in investing activities changed by $179.5 million during 2023, as compared to 2022. The change was primarily related to the Momentum and RavenVolt acquisitions, completed in 2022. Net cash used in investing activities changed by $498.5 million during 2022, as compared to 2021.
Net cash used in investing activities changed by $179.5 million during 2023, as compared to 2022. The change was primarily related to the Momentum and RavenVolt acquisitions, completed in 2022. Financing Activities Net cash used in financing activities was $61.5 million in 2024, as compared to net cash used in financing activities of $186.3 million in 2023.
The surety bonds typically remain in force for one to five years and may include optional renewal periods. As of October 31, 2023, these letters of credit totaled $58.2 million, and surety bonds and surety-backed letters of credit totaled $776.2 million, respectively.
The surety bonds typically remain in force for one to five years and may include optional renewal periods. As of October 31, 2024, these letters of credit totaled $57.9 million, and surety bonds and surety-backed letters of credit totaled $854.7 million, respectively.
Gross margin decreased by 36 bps to 13.1% in 2023, as compared to 13.4% in 2022. The decrease in gross margin was primarily driven by the decrease in favorable self-insurance adjustments related to prior year claims as a result of actuarial evaluations completed on our workers’ compensation, general liability, automobile liability, and property damage insurance plans.
The decrease in gross margin was primarily driven by the increase in self-insurance adjustments related to prior year claims as a result of actuarial evaluations completed on our workers’ compensation, general liability, automobile liability, and property damage insurance plans.
In 2022, we decreased our total reserves related to prior year claims by $36.8 million. 22 Key Financial Highlights • Revenues increased by $289.8 million, or 3.7%, to $8,096.4 million during 2023, as compared to 2022. Revenue growth was comprised of organic growth of 2.4% and acquisition growth of 1.3%.
In 2023, we decreased our total reserves related to prior year claims by $14.8 million. 23 Key Financial Highlights • Revenues increased by $263.0 million, or 3.2%, to $8,359.4 million during 2024, as compared to 2023. Revenue growth was comprised of organic growth of 2.9% and acquisition growth of 0.3%.
In addition, certain of these matters may not require cash settlements due to the utilization of credits and net operating loss carryforwards as well as other offsets, including the indirect benefit from other taxing jurisdictions that may be available. • Contingent Consideration Payable in Connection with Our Acquisition of RavenVolt – At October 31, 2023, contingent consideration of up to $280.0 million in cash may be paid in calendar years 2024, 2025, and 2026, if the RavenVolt business achieves certain financial targets, as defined in the merger agreement, in calendar years 2023, 2024, and 2025 .
In addition, certain of these matters may not require cash settlements due to the utilization of credits and net operating loss carryforwards as well as other offsets, including the indirect benefit from other taxing jurisdictions that may be available. • Contingent Consideration Payable in Connection with Our Acquisition of RavenVolt – At October 31, 2024, contingent consideration of up to $205.0 million, of which $34.1 million has been accrued as of October 31, 2024, in cash may be paid in calendar year 2026 if the RavenVolt business achieves certain financial targets in calendar year 2025, as defined in the merger agreement. 34 Off-Balance Sheet Arrangements We have no off-balance sheet arrangements other than unrecorded standby letters of credit and surety bonds.
Manufacturing & Distribution Years Ended October 31, ($ in millions) 2023 2022 Increase Revenues $ 1,526.7 $ 1,445.2 $ 81.5 5.6% Operating profit 161.7 161.8 (0.1) —% Operating profit margin 10.6 % 11.2 % (60) bps M&D revenues increased by $81.5 million, or 5.6%, to $1,526.7 million during 2023, as compared to 2022.
Manufacturing & Distribution Year Ended October 31, ($ in millions) 2024 2023 Increase Revenues $ 1,554.3 $ 1,526.7 $ 27.6 1.8% Operating profit 166.3 161.7 4.6 2.8% Operating profit margin 10.7 % 10.6 % 11 bps M&D revenues increased by $27.6 million, or 1.8%, to $1,554.3 million during 2024, as compared to 2023.
We are currently evaluating the impact of implementing this guidance on our financial statements; however, we do not expect adoption to have a material impact. This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. 38
We are currently evaluating the impact of implementing this guidance on our financial statements. This ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. 40
In 2022, we decreased our total reserves related to prior years claims by $36.8 million. It is possible that actual results could differ from recorded self-insurance liabilities.
In 2023, we decreased our total reserves related to prior years claims by $14.8 million. It is possible that actual results could differ from recorded self-insurance liabilities. Our insurance claims liabilities as of October 31, 2024 amounted to $619.4 million.
Additionally, we repurchased 3.3 million of shares for $138.1 million, including excise taxes during 2023. • At October 31, 2023, total outstanding borrowings under our Amended Credit Facility were $1,313.8 million, and we had up to $483.0 million of borrowing capacity. 23 Results of Operations Consolidated Years Ended October 31, 2023 vs. 2022 ($ in millions) 2023 2022 2021 Increase / (Decrease) Revenues $ 8,096.4 $ 7,806.6 $ 6,228.6 $ 289.8 3.7% Operating expenses 7,037.6 6,757.5 5,258.2 280.1 4.1% Gross margin 13.1 % 13.4 % 15.6 % (36) bps Selling, general and administrative expenses 572.8 628.3 719.2 (55.5) (8.8)% Amortization of intangible assets 76.5 72.1 45.0 4.4 6.1% Operating profit 409.5 348.8 206.3 60.7 17.4% Income from unconsolidated affiliates 3.9 2.4 2.1 1.5 60.1% Interest expense (82.3) (41.1) (28.6) (41.2) (99.9)% Income before income taxes 331.1 310.0 179.8 21.1 6.8% Income tax provision (79.7) (79.6) (53.5) (0.1) (0.2)% Net income 251.3 230.4 126.3 20.9 9.1% Other comprehensive income Interest rate swaps (0.5) 36.7 4.5 (37.2) NM* Foreign currency translation and other 7.3 (19.8) 5.3 27.1 NM* Income tax provision 0.1 (10.5) (1.5) 10.6 NM* Comprehensive income $ 258.1 $ 236.9 $ 134.5 $ 21.2 9.0% *Not meaningful The Year Ended October 31, 2023, Compared with the Year Ended October 31, 2022 Revenues Revenues increased by $289.8 million, or 3.7%, to $8,096.4 million during 2023, as compared to 2022.
Additionally, we repurchased 1.17 million of shares for $55.8 million, excluding excise taxes during 2024. • At October 31, 2024, total outstanding borrowings under our Amended Credit Facility were $1,335.3 million, and we had up to $423.6 million of borrowing capacity. 24 Results of Operations Consolidated Years Ended October 31, 2024 vs. 2023 ($ in millions) 2024 2023 2022 Increase/(Decrease) Revenues $ 8,359.4 $ 8,096.4 $ 7,806.6 $ 263.0 3.2% Operating expenses 7,325.9 7,037.6 6,757.5 288.3 4.1% Gross margin 12.4 % 13.1 % 13.4 % (71) bps Selling, general and administrative expenses 765.3 572.8 628.3 192.5 33.6% Amortization of intangible assets 56.1 76.5 72.1 (20.4) (26.6)% Operating profit 212.0 409.5 348.8 (197.5) (48.2)% Income from unconsolidated affiliates 6.5 3.9 2.4 2.6 69.4% Interest expense (85.0) (82.3) (41.1) (2.7) (3.3)% Income before income taxes 133.6 331.1 310.0 (197.5) (59.7)% Income tax provision (52.2) (79.7) (79.6) 27.5 34.5% Net income 81.4 251.3 230.4 (169.9) (67.6)% Other comprehensive (loss)/income Interest rate swaps (22.9) (0.5) 36.7 (22.4) NM* Foreign currency translation and other 6.8 7.3 (19.8) (0.5) (6.5)% Income tax provision 6.3 0.1 (10.5) 6.2 NM* Comprehensive income $ 71.6 $ 258.1 $ 236.9 $ (186.5) (72.3)% *Not meaningful The Year Ended October 31, 2024, Compared with the Year Ended October 31, 2023 Revenues Revenues increased by $263.0 million, or 3.2%, to $8,359.4 million during 2024, as compared to 2023.
The specific case reserves estimated by the third-party administrators are provided to an actuary who assists us in projecting an actuarial estimate of the overall ultimate losses for our self-insured or high deductible programs. The projection includes the case reserves plus an actuarial estimate of reserves required for additional developments, including IBNR Claims.
We compare actual trends to expected trends and monitor claims development. The specific case reserves estimated by the third-party administrators are provided to an actuary who assists us in projecting an actuarial estimate of the overall ultimate losses for our self-insured or high deductible programs.
We removed “Contingent Consideration” from our critical accounting policies and estimates in 2023. There have been no other significant changes to our critical accounting policies and estimates for the year ended October 31, 2023.
There have been no significant changes to our critical accounting policies and estimates for the year ended October 31, 2024.
At October 31, 2023, we had up to $483.0 million of borrowing capacity. 30 Reinvestment of Foreign Earnings We plan to reinvest our foreign earnings to fund future non-U.S. growth and expansion, and we do not anticipate remitting such earnings to the United States.
Reinvestment of Foreign Earnings We plan to reinvest our foreign earnings to fund future non-U.S. growth and expansion, and we do not anticipate remitting such earnings to the United States.
Financial Information for Each Reportable Segment Years Ended October 31, 2023 vs. 2022 ($ in millions) 2023 2022 2021 Increase / (Decrease) Revenues Business & Industry $ 4,089.4 $ 4,095.9 $ 2,853.8 $ (6.5) (0.2)% Manufacturing & Distribution 1,526.7 1,445.2 1,363.1 81.5 5.6% Education 880.4 834.7 830.8 45.7 5.5% Aviation 925.7 804.0 651.1 121.7 15.1% Technical Solutions 674.2 626.8 529.8 47.4 7.6% $ 8,096.4 $ 7,806.6 $ 6,228.6 $ 289.8 3.7% Operating profit (loss) Business & Industry $ 315.6 $ 334.9 $ 285.9 $ (19.3) (5.7)% Operating profit margin 7.7 % 8.2 % 10.0 % (46) bps Manufacturing & Distribution 161.7 161.8 155.5 (0.1) —% Operating profit margin 10.6 % 11.2 % 11.4 % (60) bps Education 49.7 47.1 61.5 2.6 5.5% Operating profit margin 5.6 % 5.6 % 7.4 % — bps Aviation 60.0 29.3 32.1 30.7 NM* Operating profit margin 6.5 % 3.6 % 4.9 % 283 bps Technical Solutions 53.2 63.8 49.4 (10.6) (16.5)% Operating profit margin 7.9 % 10.2 % 9.3 % (228) bps Government Services — (0.3) (0.2) 0.3 NM* Operating profit margin NM* NM* NM* NM* Corporate (226.6) (284.5) (374.6) (57.9) 20.3% Adjustment for income from unconsolidated affiliates, included in Aviation (3.9) (2.4) (2.1) (1.5) (60.1)% Adjustment for tax deductions for energy efficient government buildings, included in Technical Solutions (0.3) (0.9) (1.2) 0.6 66.8% $ 409.5 $ 348.8 $ 206.3 $ 60.7 17.4% *Not meaningful 26 The Year Ended October 31, 2023, Compared with the Year Ended October 31, 2022 Business & Industry Years Ended October 31, ($ in millions) 2023 2022 Increase Revenues $ 4,089.4 $ 4,095.9 $ (6.5) (0.2)% Operating profit 315.6 334.9 (19.3) (5.7)% Operating profit margin 7.7 % 8.2 % (46) bps B&I revenues decreased by $6.5 million, or 0.2%, to $4,089.4 million during 2023, as compared to 2022.
Financial Information for Each Reportable Segment Year Ended October 31, 2024 vs. 2023 ($ in millions) 2024 2023 2022 Increase/(Decrease) Revenues Business & Industry $ 4,059.1 $ 4,089.4 $ 4,095.9 $ (30.3) (0.7)% Manufacturing & Distribution 1,554.3 1,526.7 1,445.2 27.6 1.8% Aviation 1,032.6 925.7 804.0 106.9 11.5% Education 904.0 880.4 834.7 23.6 2.7% Technical Solutions 809.3 674.2 626.8 135.1 20.0% $ 8,359.4 $ 8,096.4 $ 7,806.6 $ 263.0 3.2% Operating profit (loss) Business & Industry $ 307.0 $ 315.6 $ 334.9 $ (8.6) (2.7)% Operating profit margin 7.6 % 7.7 % 8.2 % (15) bps Manufacturing & Distribution 166.3 161.7 161.8 4.6 2.8% Operating profit margin 10.7 % 10.6 % 11.2 % 11 bps Aviation 59.1 60.0 29.3 (0.9) (1.4)% Operating profit margin 5.7 % 6.5 % 3.6 % (75) bps Education 55.3 49.7 47.1 5.6 11.4% Operating profit margin 6.1 % 5.6 % 5.6 % 48 bps Technical Solutions 69.4 53.2 63.8 16.2 30.4% Operating profit margin 8.6 % 7.9 % 10.2 % 68 bps Government Services — — (0.3) — NM* Operating profit margin NM* NM* NM* NM* Corporate (433.1) (226.6) (284.5) 206.5 (91.1)% Adjustment for income from unconsolidated affiliates, included in Aviation and Technical Solutions (6.5) (3.9) (2.4) (2.6) (69.4)% Adjustment for tax deductions for energy efficient government buildings, included in Technical Solutions (5.5) (0.3) (0.9) (5.2) NM* $ 212.0 $ 409.5 $ 348.8 $ (197.5) (48.2)% *Not meaningful 27 The Year Ended October 31, 2024, Compared with the Year Ended October 31, 2023 Business & Industry Year Ended October 31, ($ in millions) 2024 2023 Increase Revenues $ 4,059.1 $ 4,089.4 $ (30.3) (0.7)% Operating profit 307.0 315.6 (8.6) (2.7)% Operating profit margin 7.6 % 7.7 % (15) bps B&I revenues decreased by $30.3 million, or 0.7%, to $4,059.1 million during 2024, as compared to 2023.
While we still expect to retain a large portion of this business, we expect M&D’s financial results to be impacted in the near-term. Insurance Reserves We use a combination of insured and self-insurance programs to cover workers’ compensation, general liability, automobile liability, property damage, and other insurable risks.
A large M&D client completed its rebalancing of a portion of its work needs as part of its normal procurement process. We expect M&D’s financial results to be adversely impacted in the near-term. Insurance Reserves We use a combination of insured and self-insurance programs to cover workers’ compensation, general liability, automobile liability, property damage, and other insurable risks.
Our borrowing capacity is subject to, and limited by, compliance with the covenants described above. At October 31, 2023, we were in compliance with these covenants and expect to be in compliance in the foreseeable future.
Our borrowing capacity is subject to, and limited by, compliance with the covenants described above. At October 31, 2024, we were in compliance with these covenants and expect to be in compliance in the foreseeable future. During 2024, we made $32.5 million of principal payments under the term loan.
Management reimbursement revenues for this segment totaled $270.1 million and $227.8 million during 2023 and 2022, respectively. Operating profit decreased by $19.3 million, or 5.7%, to $315.6 million during 2023, as compared to 2022. Operating profit margin decreased by 46 bps to 7.7% in 2023 from 8.2% in 2022.
Management reimbursement revenues for this segment totaled $36.3 million and $31.8 million during 2024 and 2023, respectively. Operating profit decreased by $0.9 million, to $59.1 million during 2024, as compared to 2023. Operating profit margin decreased by 75 bps to 5.7% in 2024, from 6.5% in 2023.
The increase was primarily attributable to a recovery in leisure and business travel (both domestic and international) and new parking-related services. In addition, we recognized $11.4 million in revenue from an Aviation parking project, whereby all the direct labor and related costs were recognized in prior periods.
The increase was primarily attributable to new business and scope expansions with the existing clients as well as continuing recovery in travel volume. In addition, in 2023, we recognized $11.4 million in revenue from an Aviation parking project, whereby all the direct labor and related costs were recognized prior to 2023.
The increase was primarily attributable to net new business wins, partially offset by a decrease in work orders. Operating profit increased by $2.6 million, or 5.5% to $49.7 million during 2023, as compared to 2022. Operating profit margin of 5.6% in 2023 was consistent with 2022.
The increase was primarily attributable to net new business wins, partially offset by a decrease in work orders. Operating profit increased by $5.6 million, or 11.4% to $55.3 million during 2024, as compared to 2023. Operating profit margin increased by 48 bps to 6.1% in 2024 from 5.6% in 2023.
Operating cash flows primarily depend on: revenue levels; the quality and timing of collections of accounts receivable; the timing of payments to suppliers and other vendors; the timing and amount of income tax payments; and the timing and amount of payments on insurance claims and legal 31 settlements.
Operating cash flows primarily depend on: revenue levels; profitability levels of our jobs; the quality and timing of collections of accounts receivable; the timing of payments to suppliers and other vendors; the timing and amount of income tax payments; the actual payments of contingent consideration made in excess of the acquisition-date fair value; and the timing and amount of payments on insurance claims and legal 32 settlements.
Operating 32 and finance lease obligations were $168.0 million, with $42.2 million payable within 12 months.
Operating and finance lease obligations were $160.0 million, with $37.4 million payable within 12 months.
We utilize the results of actuarial studies to estimate our insurance rates and insurance reserves for future periods and to adjust reserves, if appropriate, for prior years. Our self-insurance liabilities contain uncertainties due to assumptions required and judgment used. Costs to settle our obligations, including legal and healthcare costs, could fluctuate and cause estimates of our self-insurance liabilities to change.
The projection includes the case reserves plus an actuarial estimate of reserves required for additional developments, including IBNR Claims. We utilize the results of actuarial studies to estimate our insurance rates and insurance reserves for future periods and to adjust reserves, if appropriate, for prior years. Our self-insurance liabilities contain uncertainties due to assumptions required and judgment used.
Years Ended October 31, (in millions) 2023 2022 2021 Net cash provided by operating activities 243.3 20.4 314.3 Net cash used in investing activities (62.1) (241.5) (740.0) Net cash (used in) provided by financing activities (186.3) 235.5 92.4 Operating Activities Net cash provided by operating activities of continuing operations increased by $222.9 million during 2023, as compared to 2022.
Year Ended October 31, (in millions) 2024 2023 2022 Net cash provided by operating activities 226.7 243.3 20.4 Net cash used in investing activities (171.9) (62.1) (241.5) Net cash (used in) provided by financing activities (61.5) (186.3) 235.5 Operating Activities Net cash provided by operating activities decreased by $16.6 million during 2024, as compared to 2023.
Technical Solutions Years Ended October 31, ($ in millions) 2023 2022 Increase / (Decrease) Revenues $ 674.2 $ 626.8 $ 47.4 7.6% Operating profit 53.2 63.8 (10.6) (16.5)% Operating profit margin 7.9 % 10.2 % (228) bps Technical Solutions revenues increased by $47.4 million, or 7.6%, to $674.2 million during 2023, as compared to 2022.
Technical Solutions Year Ended October 31, ($ in millions) 2024 2023 Increase Revenues $ 809.3 $ 674.2 $ 135.1 20.0% Operating profit 69.4 53.2 16.2 30.4% Operating profit margin 8.6 % 7.9 % 68 bps Technical Solutions revenues increased by $135.1 million, or 20.0%, to $809.3 million during 2024, as compared to 2023.
The third-party claims administrators establish the case reserves based upon known factors related to the type and severity of the claims, demographic data, legislative matters, and case law, as appropriate. We compare actual trends to expected trends and monitor claims development.
As part of this evaluation, we review the status of existing and new claim reserves as established by our third-party claims administrators. The third-party claims administrators establish the case reserves based upon known factors related to the type and severity of the claims, demographic data, legislative matters, and case law, as appropriate.
We utilize the results of actuarial studies to estimate our insurance rates and insurance reserves for future periods and to adjust reserves, if appropriate, for prior years. The actuarial reviews demonstrate that the changes we have made to our risk management program continue to positively impact the frequency and severity of claims.
We utilize the results of actuarial studies to estimate our insurance rates and insurance reserves for future periods and to adjust reserves, if appropriate, for prior years.
Our net cash provided by operating cash activities were higher than prior year, primarily due to the timing of certain working capital requirements, which included a $143.8 million payment for the Bucio case in 2022, and the related income tax benefit . • Dividends of $57.5 million were paid to shareholders, and dividends totaling $0.88 per common share were declared during 2023.
Our net cash provided by operating cash activities was lower than prior year, primarily due to the timing of certain working capital requirements. • Dividends of $56.5 million were paid to shareholders, and dividends totaling $0.90 per common share were declared during 2024.
Insurance claim liabilities represent our estimate of retained risks without regard to insurance coverage. We retain a substantial portion of the risk related to certain workers’ compensation and medical claims. Liabilities associated with these losses include estimates of both claims filed and IBNR Claims.
We retain a substantial portion of the risk related to certain workers’ compensation and medical claims. Liabilities associated with these losses include estimates of both claims filed and IBNR Claims. With the assistance of third-party actuaries, we periodically review our estimate of ultimate losses for IBNR Claims and adjust our required self-insurance reserves as appropriate.
Based on these studies, the implied fair value of each of our reporting units was substantially in excess of its carrying value, with the exception of the Education reporting unit, where the excess of the fair value over its carrying value was less than 20%.
Based on these studies, the implied fair value of each of our reporting units was substantially in excess of its carrying value, with the exception of the Education reporting unit which had an excess of 25%. Therefore, we concluded there were no indicators of impairment.
The increase was primarily driven by a $143.8 million payments made for the Bucio settlement in 2022, and the related income tax benefit . Net cash provided by operating activities of continuing operations decreased by $293.9 million during 2022, as compared to 2021.
The increase was primarily driven by a $143.8 million payment made for the Bucio settlement in 2022 and the related income tax benefit. Investing Activities Net cash used in investing activities changed by $109.8 million during 2024, as compared to 2023. The change was primarily related to the Quality Uptime Acquisition, completed in 2024.
The impairment charge reduced the carrying value to zero for those components. 35 36 Description Judgments and Uncertainties Effect if Actual Results Differ from Assumptions Insurance Reserves We use a combination of insured and self-insurance programs to cover workers’ compensation, general liability, automobile liability, property damage, and other insurable risks.
We concluded there were no indicators of impairment. 37 38 Description Judgments and Uncertainties Effect if Actual Results Differ from Assumptions Insurance Reserves We use a combination of insured and self-insurance programs to cover workers’ compensation, general liability, automobile liability, property damage, and other insurable risks. Insurance claim liabilities represent our estimate of retained risks without regard to insurance coverage.
We believe that our cash on hand in the United States, along with our Amended Credit Facility and future domestic cash flows, are sufficient to satisfy our domestic liquidity requirements.
We believe that our cash on hand in the United States, along with our Amended Credit Facility and future domestic cash flows, are sufficient to satisfy our domestic liquidity requirements. Share Repurchases Effective December 13, 2023, our Board of Directors expanded our existing share repurchase program by an additional $150.0 million of our common stock.
Education Years Ended October 31, ($ in millions) 2023 2022 Increase Revenues $ 880.4 $ 834.7 $ 45.7 5.5% Operating profit 49.7 47.1 2.6 5.5% Operating profit margin 5.6 % 5.6 % — bps Education revenues increased by $45.7 million, or 5.5%, to $880.4 million during 2023, as compared to 2022.
Aviation Year Ended October 31, ($ in millions) 2024 2023 Increase / (Decrease) Revenues $ 1,032.6 $ 925.7 $ 106.9 11.5% Operating profit 59.1 60.0 (0.9) (1.4)% Operating profit margin 5.7 % 6.5 % (75) bps Aviation revenues increased by $106.9 million, or 11.5% to $1,032.6 million, during 2024, as compared to 2023.
Furthermore, we continue to adjust our reserves consistent with known fact patterns. Based on the results of the actuarial reviews performed, we decreased our total reserves related to prior years for known claims as well as our estimate of the loss amounts associated with IBNR Claims during 2023 by $14.8 million.
Based on the results of the actuarial reviews performed during 2024, which included analyzing recent loss development patterns, comparing the loss development against benchmarks, and applying actuarial projection methods to determine the estimate of ultimate losses, we increased our total reserves related to prior years for known claims as well as our estimate of the loss amounts associated with IBNR Claims by $20.3 million in 2024.
Corporate Years Ended October 31, ($ in millions) 2023 2022 Decrease Corporate expenses $ (226.6) $ (284.5) $ (57.9) 20.3% Corporate expenses decreased by $57.9 million, or 20.3%, to $226.6 million during 2023, as compared to 2022.
Corporate Year Ended October 31, ($ in millions) 2024 2023 Increase Corporate expenses $ (433.1) $ (226.6) $ 206.5 (91.1)% Corporate expenses increased by $206.5 million, or 91.1%, to $433.1 million during 2024, as compared to 2023.
Largely driven by the lingering effects of the Pandemic, especially the normalization of hybrid work, the commercial real estate industry, particularly multi-tenant and owner-occupied commercial office buildings, is experiencing an increase in vacancy rates.
One such monitored change is the strength or softness of the commercial real estate industry, especially multi-tenant and owner-occupied commercial office buildings. The recent softness in the market is primarily attributable to the lingering effects of the Pandemic, especially the normalization of hybrid work, which has resulted in higher office vacancy rates.
The change was primarily related to the Able Acquisition during the fourth quarter of 2021, partially offset by Momentum and RavenVolt acquisitions. Financing Activities Net cash used in financing activities was $186.3 million in 2023, as compared to net cash provided by financing activities of $235.5 million in 2022.
The decrease in net cash used was primarily related to lower share buyback repurchases in 2024 and an increase in our book cash overdrafts. Net cash used in financing activities was $186.3 million in 2023, as compared to net cash provided by financing activities of $235.5 million in 2022.
Given that Class A and high-quality commercial office buildings are a key end market for the Company, we expect a decline in demand for janitorial services and work orders in these markets near-term. As a result, we expect our B&I industry to experience muted growth in the near-term.
Given that Class A and high-quality commercial office buildings are a key end market for us, we have experienced modest declines in demand for janitorial services and work orders in these markets. We expect the occupancy rates of Class A and high-quality buildings and back-to office trends to improve throughout 2025 .
Our effective tax rate for 2023 was impacted by a $12.8 million benefit related to the non-taxable change in the fair value of the contingent consideration related to the RavenVolt Acquisition, a $2.2 million benefit for share-based compensation; and a $1.5 million benefit for return to provision adjustment primarily related to state and local deferred income taxes; partially offset by a $4.8 million expense related to non-deductible executive compensation.
Our effective tax rate for 2024 was primarily impacted by a $95.7 million non-taxable expense related to the change in the fair value of the contingent consideration related to the RavenVolt Acquisition.
Incident rates, including frequency and severity, could fluctuate and cause the estimates in our self-insurance liabilities to change. These estimates are subject to: changes in the regulatory environment; fluctuations in projected exposures, including payroll, revenues, and the number of vehicle units; and the frequency, lag, and severity of claims.
These estimates are subject to: changes in the regulatory environment; fluctuations in projected exposures, including payroll, revenues, and the number of vehicle units; and the frequency, lag, and severity of claims. The full extent of certain claims, especially workers’ compensation and general liability claims, may not be fully determined for several years.
Interest Expense Interest expense increased by $41.2 million, or 99.9%, to $82.3 million during 2023, as compared to 2022, primarily driven by higher interest rates on our debt borrowings. Income Taxes During 2023 and 2022, we had effective tax rates of 24.1% and 25.7%, respectively, resulting in a provision for tax of $79.7 million and $79.6 million, respectively. .
Income Taxes During 2024 and 2023, we had effective tax rates of 39.1% and 24.1%, respectively, resulting in a provision for tax of $52.2 million and $79.7 million, respectively.
The increase was primarily attributable to the net new business wins and the expansion of business with existing customers, partially offset by a decrease in work orders. Operating profit decreased by $0.1 million, to $161.7 million during 2023, as compared to 2022. Operating profit margin decreased by 60 bps to 10.6% in 2023 from 11.2% in 2022.
The increase was primarily attributable to the expansion of business with existing customers, partially offset by the expected rebalancing of the scope of work with an existing customer and a loss of a certain customer. Operating profit increased by $4.6 million, to $166.3 million during 2024, as compared to 2023.
Operating profit margin increased to 6.5% during 2023, from 3.6% during 2022. The increase in operating profit margin was primarily attributable to the $11.4 million in revenue from an Aviation parking project. Operating profit margin was negatively impacted by an increase in direct labor and related costs due to increased headcounts as travel continues to recover.
The decrease in operating profit margin was primarily attributable to the $11.4 million in revenue from an Aviation parking project recognized in 2023.
Early adoption is permitted. 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures This ASU, issued in November 2023, improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.
A 10% change in our projected ultimate losses would have affected net income by approximately $37.2 million for 2024. 39 Accounting Pronouncements Accounting Standard Updates Topic Summary Effective Date/ Method of Adoption 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures This ASU, issued in November 2023, improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.
These amounts are based on expected future service and were calculated using the same assumptions used to measure our benefit obligation at October 31, 2023.
These amounts are based on expected future service and were calculated using the same assumptions used to measure our benefit obligation at October 31, 2024. • Contingent Consideration Payable Connection with Our Acquisition of RavenVolt – At October 31, 2024, contingent consideration of up to $75.0 million in cash may be paid in calendar year 2025 if the RavenVolt business achieves certain financial targets in calendar year 2024, as defined in the merger agreement .
The decrease in operating profit margin was primarily driven by a decrease in work orders, which are generally more profitable than contracted service, the change in contract mix, and an increase in direct labor and related costs due to a limited labor supply in certain non-union markets. The decrease was partially offset by lower amortization of intangible assets.
The increase in operating profit margin was primarily attributable to the contract mix and lower amortization of intangible assets. This increase was partially offset by an expected charge to potentially settle a certain client matter.
The organic revenue decrease was primarily driven by the decline in electric vehicle charging station installation sales and lower project revenues due to the timing of completions of certain bundled energy solutions projects. Operating profit decreased by $10.6 million, or 16.5%, to $53.2 million during 2023, as compared to 2022.
Revenue growth was comprised of organic growth of 16.1% and acquisition growth of 3.9%. The organic revenue increase was primarily driven by higher project revenues due to the timing of completions of microgrid systems and generators installation projects, partially offset by a decrease in electric vehicle charging station sales.
The decrease in corporate expenses was primarily related to: • a $45.6 million decrease in the fair value of contingent consideration related to the RavenVolt Acquisition; • a $24.0 million benefit from ERC refunds received; • a $6.6 million decrease in certain technology projects primarily attributable to discrete transformational costs under our ELEVATE strategy for developing the new ERP system, client-facing technology, workforce management tools, and data analytics; 28 • a $6.4 million decrease in compensation and related expenses primarily due to lower compensation under certain incentive plans; and • a $2.4 million decrease in acquisition and integration costs primarily attributable to our prior years’ acquisitions.
This increase was partially offset by: 29 • an $18.6 million decrease in certain discrete transformational costs under our ELEVATE strategy for developing the new ERP system, client-facing technology, workforce management tools, and data analytics.
A 10% decrease in the estimated fair value of any of our reporting units would not have resulted in a different conclusion. We concluded there were no indicators of impairment. During the third quarter of 2021, we recognized a non-cash impairment charge totaling $9.1 million in our Corporate segment for previously capitalized internal-use software related to our ERP system implementation.
A 10% decrease in the estimated fair value of any of our reporting units would not have resulted in a different conclusion.
Amortization of Intangible Assets Amortization of intangible assets increased by $4.4 million, or 6.1%, to $76.5 million during 2023, as compared to 2022. This increase was primarily due to the amortization of intangibles acquired as part of the RavenVolt and Momentum acquisitions.
This decrease was primarily due to the lower amortization of intangibles, primarily intangibles acquired as part of the RavenVolt Acquisition. Interest Expense Interest expense increased by $2.7 million, or 3.3%, to $85.0 million during 2024, as compared to 2023, primarily driven by higher borrowings from our Amended Credit Facility to fund the Quality Uptime Acquisition.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changePrincipal Properties as of October 31, 2023 Location Character of Office Approximate Square Feet Lease Expiration Date, Unless Owned Segment Dallas, Texas Warehouse and Operations Support 27,500 9/30/2028 Technical Solutions, B&I, Aviation, Corporate, and M&D Atlanta, Georgia Operations Support 37,000 10/31/2027 All New York, New York Corporate Headquarters 44,000 1/3/2032 Corporate and B&I Sugar Land, Texas Enterprise Services 62,500 3/31/2028 All Tustin, California Operations Support 40,000 7/31/2029 B&I and Technical Solutions San Francisco, California Operations Support 21,324 6/30/2029 B&I and Corporate Cummings, Georgia Operations Support 57,637 1/31/2034 Technical Solutions In addition to the above properties, we have other offices, warehouses, and parking facilities in various locations, primarily in the United States.
Biggest changePrincipal Properties as of October 31, 2024 Location Character of Office Approximate Square Feet Lease Expiration Date, Unless Owned Segment Dallas, Texas Warehouse and Operations Support 27,500 9/30/2028 Technical Solutions, B&I, Aviation, Corporate, and M&D Atlanta, Georgia Operations Support 37,000 10/31/2027 All New York, New York Corporate Headquarters 44,000 1/3/2032 Corporate and B&I Sugar Land, Texas Enterprise Services 62,500 3/31/2028 All Tustin, California Operations Support 40,000 7/31/2029 B&I and Technical Solutions San Francisco, California Operations Support 21,324 6/30/2029 B&I and Corporate Cumming, Georgia Operations Support 57,637 1/31/2034 Technical Solutions In addition to the above properties, we have other offices, warehouses, and parking facilities in various locations, primarily in the United States.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS. Information with respect to legal matters is set forth in Note 13, “Commitments and Contingencies,” in the Notes to consolidated financial statements (included in Part II., Item 8 of this Form 10-K) and is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES. Not applicable. 18 PART II
Biggest changeITEM 3. LEGAL PROCEEDINGS. Information with respect to legal matters is set forth in Note 13, “Commitments and Contingencies,” in the Notes to consolidated financial statements (included in Part II., Item 8 of this Form 10-K) and is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES. Not applicable. 19 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeEffective December 9, 2022, and December 13, 2023, our Board of Directors expanded the Share Repurchase Program by $150.0 million and $150.0 million, respectively. Share repurchases may take place on the open market or otherwise, and all or part of the repurchases may be made pursuant to Rule 10b5-1 plans or in privately negotiated transactions.
Biggest changeShare repurchases may take place on the open market or otherwise, and all or part of the repurchases may be made pursuant to Rule 10b5-1 plans or in privately negotiated transactions. The timing of repurchases is at our discretion and will depend upon several factors, including market and business conditions, future cash flows, share price, share availability, and other factors.
The comparisons in the performance graph are based on historical data and are not indicative of, or intended to forecast, the possible future performance of our common stock. 20 ITEM 6. [RESERVED]
The comparisons in the performance graph are based on historical data and are not indicative of, or intended to forecast, the possible future performance of our common stock. 21 ITEM 6. [RESERVED]
Issuer Purchases of Equity Securities (in millions, except per share amounts) Total Number of Shares Purchased Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Plan Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan Period 8/1/2023 – 8/31/2023 — — $ — $ 170.3 9/1/2023 – 9/30/2023 $ 1.4 $ 40.24 $ 1.4 $ 115.3 10/1/2023 – 10/31/2023 1.3 $ 41.41 1.3 $ 60.3 Total 2.7 $ 40.82 2.7 (1) Average price paid per share does not include any excise tax for stock repurchases as part of the Inflation Reduction Act of 2022. 19 Performance Graph The following graph compares the five-year cumulative total return for our common stock against the Standard & Poor’s 500 Index (“S&P 500”) and the Standard & Poor’s SmallCap 600 Index (“S&P 600”).
Issuer Purchases of Equity Securities (in millions, except per share amounts) Total Number of Shares Purchased Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Plan Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan Period 8/1/2024 – 8/31/2024 — $ — — $ 186.5 9/1/2024 – 9/30/2024 0.13 $ 51.52 0.13 $ 180.0 10/1/2024 – 10/31/2024 0.49 $ 52.65 0.49 $ 154.5 Total 0.61 $ 52.42 0.61 (1) Average price paid per share does not include any excise tax for stock repurchases as part of the Inflation Reduction Act of 2022. 20 Performance Graph The following graph compares the five-year cumulative total return for our common stock against the Standard & Poor’s 500 Index (“S&P 500”) and the Standard & Poor’s SmallCap 600 Index (“S&P 600”).
INDEXED RETURNS Years Ended October 31, Company / Index 2018 2019 2020 2021 2022 2023 ABM Industries Incorporated $ 100.0 $ 121.0 $ 117.8 $ 151.9 $ 156.5 $ 141.2 S&P 500 Index $ 100.0 114.3 125.4 179.3 153.1 168.6 S&P SmallCap 600 Index $ 100.0 103.2 95.3 151.4 133.5 123.3 This performance graph shall not be deemed to be “soliciting material” or “filed” with the SEC, or subject to Regulation 14A or 14C, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended.
INDEXED RETURNS Years Ended October 31, Company / Index 2019 2020 2021 2022 2023 2024 ABM Industries Incorporated $ 100.0 $ 97.4 $ 125.6 $ 129.3 $ 116.7 $ 160.4 S&P 500 Index 100.0 109.7 156.8 133.9 147.5 203.5 S&P SmallCap 600 Index 100.0 92.3 146.7 129.3 119.4 155.3 This performance graph shall not be deemed to be “soliciting material” or “filed” with the SEC, or subject to Regulation 14A or 14C, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended.
Future dividends will be determined based on our earnings, capital requirements, financial condition, and other factors considered relevant by our Board of Directors. At December 15, 2023, there were 2,945 registered holders of our common stock.
Future dividends will be determined based on our earnings, capital requirements, financial condition, and other factors considered relevant by our Board of Directors. At December 18, 2024, there were 2,823 registered holders of our common stock. Common Stock Repurchases Effective December 13, 2023, our Board of Directors expanded our existing share repurchase program by an additional $150.0 million, respectively.
The timing of repurchases is at our discretion and will depend upon several factors, including market and business conditions, future cash flows, share price, share availability, and other factors. Repurchased shares are retired and returned to an authorized but unissued status. At October 31, 2023, authorization for $60.3 million of repurchases remained under the Share Repurchase Program.
Repurchased shares are retired and returned to an authorized but unissued status. At October 31, 2024, authorization for $154.5 million of repurchases remained under the Share Repurchase Program.
Removed
Common Stock Repurchases Effective December 18, 2019, our Board of Directors replaced our then-existing share repurchase program with a new share repurchase program under which we may repurchase up to $150.0 million of our common stock (the “Share Repurchase Program”).

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeBased on our average borrowings, interest rates, and interest rate swaps in effect at October 31, 2023 and 2022, a 100 basis point increase in SOFR, EURIBOR, and SONIA would decrease our future earnings and cash flows by $5.4 million and $5.2 million, respectively.
Biggest changeBased on our average borrowings, interest rates, and interest rate swaps in effect at October 31, 2024 and 2023, a 100 basis point increase in SOFR, EURIBOR, and SONIA would decrease our future earnings and cash flows by $5.6 million and $5.4 million, respectively.
Interest Rate Risk We are primarily exposed to interest rate risk through our variable rate borrowings under our Amended Credit Facility, as further described in Note 11 , “Debt,” in the Financial Statements. Under the Amended Credit Facility, the term loan and U.S.-dollar-denominated borrowings under the revolver bear interest at a rate equal to one-month SOFR plus a spread.
Interest Rate Risk We are primarily exposed to interest rate risk through our variable rate borrowings under our Amended Credit Facility, as further described in Note 11 , “Credit Facility,” in the Financial Statements. Under the Amended Credit Facility, the term loan and U.S.-dollar-denominated borrowings under the revolver bear interest at a rate equal to one-month SOFR plus a spread.
If we change our intent with respect to such international investment, we would expect to implement strategies designed to manage those risks in an effort to mitigate the effect of foreign currency fluctuations on our earnings and cash flows. 39
If we change our intent with respect to such international investment, we would expect to implement strategies designed to manage those risks in an effort to mitigate the effect of foreign currency fluctuations on our earnings and cash flows. 41
To limit exposure to upward movements in interest rates associated with our floating-rate, SOFR-based borrowings, we entered into interest rate swap agreements to fix the interest rates on a portion of our outstanding borrowings. At October 31, 2023, we had interest rate swaps with an underlying notional amount of $820.1 million and fixed interest rates ranging from 1.72% to 3.81%.
To limit exposure to upward movements in interest rates associated with our floating-rate, SOFR-based borrowings, we entered into interest rate swap agreements to fix the interest rates on a portion of our outstanding borrowings. At October 31, 2024, we had interest rate swaps with an underlying notional amount of $695.0 million and fixed interest rates ranging from 1.72% to 3.81%.
Euro- and sterling-denominated borrowings under the revolver bear at rate equal to the EURIBOR and SONIA reference rates, respectively, plus a spread. At October 31, 2023, we had total outstanding borrowings of $1,313.8 million.
Euro- and sterling-denominated borrowings under the revolver bear at rate equal to the EURIBOR and SONIA reference rates, respectively, plus a spread. At October 31, 2024, we had total outstanding borrowings of $1,335.3 million.
As actual interest rate movements over time are uncertain, our interest rate swaps pose potential interest rate risks if interest rates decrease. As of October 31, 2023, the fair value of our interest rate swap agreements was an asset of $36.4 million.
As actual interest rate movements over time are uncertain, our interest rate swaps pose potential interest rate risks if interest rates decrease. As of October 31, 2024, the fair value of our interest rate swap agreements was an asset of $13.5 million.

Other ABM 10-K year-over-year comparisons