Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 17, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 1-4422 | |
Entity Registrant Name | ROLLINS, INC. | |
Entity Central Index Key | 0000084839 | |
Entity Tax Identification Number | 51-0068479 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 2170 Piedmont Road | |
Entity Address, Address Line Two | N.E. | |
Entity Address, City or Town | Atlanta | |
Entity Address, State or Province | GA | |
Entity Address, Postal Zip Code | 30324 | |
City Area Code | (404) | |
Local Phone Number | 888-2000 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | ROL | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 327,767,449 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
ASSETS | ||
Cash and cash equivalents | $ 92,582 | $ 94,276 |
Trade receivables, net of allowance for doubtful accounts of $11,861 and $16,699, respectively | 123,166 | 122,766 |
Financed receivables, short-term, net of allowance for doubtful accounts of $1,805 and $1,675, respectively | 22,209 | 22,267 |
Materials and supplies | 21,527 | 19,476 |
Other current assets | 45,346 | 51,002 |
Total current assets | 304,830 | 309,787 |
Equipment and property, net | 194,854 | 195,533 |
Goodwill | 596,067 | 572,847 |
Customer contracts, net | 279,361 | 273,720 |
Trademarks & tradenames, net | 104,863 | 102,539 |
Other intangible assets, net | 10,314 | 10,525 |
Operating lease, right-of-use assets | 207,975 | 200,727 |
Financed receivables, long-term, net of allowance for doubtful accounts of $1,248 and $1,284 respectively | 33,952 | 30,792 |
Benefit plan assets | 15,639 | 21,565 |
Deferred income taxes | 1,961 | 2,180 |
Other assets | 21,663 | 24,161 |
Total assets | 1,771,479 | 1,744,376 |
LIABILITIES | ||
Accounts payable | 36,844 | 35,234 |
Accrued insurance | 30,739 | 30,441 |
Accrued compensation and related liabilities | 68,289 | 81,943 |
Unearned revenues | 129,352 | 122,825 |
Operating lease liabilities - current | 69,094 | 66,117 |
Current portion of long-term debt | 12,500 | 12,500 |
Other current liabilities | 71,050 | 60,975 |
Total current liabilities | 417,868 | 410,035 |
Accrued insurance, less current portion | 34,921 | 34,920 |
Operating lease liabilities, less current portion | 140,152 | 135,651 |
Long-term debt | 307,300 | 279,000 |
Deferred income tax liability | 14,257 | 9,927 |
Long-term accrued liabilities | 56,610 | 59,093 |
Total liabilities | 971,108 | 928,626 |
STOCKHOLDERS’ EQUITY | ||
Preferred stock, without par value; 500,000 shares authorized, zero shares issued | ||
Common stock, par value $1 per share; 550,000,000 and 375,000,000 shares authorized, 327,767,449 and 327,430,846 shares issued and outstanding, respectively | 327,767 | 327,431 |
Paid in capital | 84,865 | 89,413 |
Accumulated other comprehensive loss | (38,711) | (21,109) |
Retained earnings | 426,450 | 420,015 |
Total stockholders’ equity | 800,371 | 815,750 |
Total liabilities and stockholders’ equity | $ 1,771,479 | $ 1,744,376 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts Receivable, Allowance for Credit Loss, Current | $ 11,861 | $ 16,699 |
Financing Receivable, Allowance for Credit Loss, Current | 1,805 | 1,675 |
Accounts Receivable, Allowance for Credit Loss, Noncurrent | $ 1,248 | $ 1,284 |
Preferred Stock, Shares Authorized | 500,000 | 500,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $ 1 | $ 1 |
Common Stock, Shares Authorized | 550,000,000 | 375,000,000 |
Common Stock, Shares, Issued | 327,767,449 | 327,430,846 |
Common Stock, Shares, Outstanding | 327,767,449 | 327,430,846 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
REVENUES | ||
Customer services | $ 487,901 | $ 429,069 |
COSTS AND EXPENSES | ||
Cost of services provided | 251,152 | 217,258 |
Depreciation and amortization | 21,597 | 16,683 |
Sales, general and administrative | 157,862 | 139,530 |
Gain on sale of assets, net | (275) | (181) |
Interest expense/(income), net | 2,165 | (274) |
INCOME BEFORE INCOME TAXES | 55,400 | 56,053 |
PROVISION FOR INCOME TAXES | 12,132 | 11,827 |
NET INCOME | $ 43,268 | $ 44,226 |
NET INCOME PER SHARE - BASIC AND DILUTED | $ 0.13 | $ 0.14 |
DIVIDENDS PAID PER SHARE | $ 0.12 | $ 0.11 |
Weighted average participating shares outstanding - basic and diluted | 327,682,000 | 327,506,000 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
NET INCOME | $ 43,268 | $ 44,226 |
Other comprehensive (loss)/earnings | ||
Foreign currency translation adjustments | (16,868) | 2,342 |
Change in derivatives | (734) | |
Other comprehensive (loss)/earnings | (17,602) | 2,342 |
Comprehensive earnings | $ 25,666 | $ 46,568 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | Total |
Beginning Balance, Shares at Dec. 31, 2018 | 327,308,000 | ||||
Beginning Balance at Dec. 31, 2018 | $ 327,308 | $ 85,386 | $ (71,078) | $ 370,292 | $ 711,908 |
Impact of adoption of ASC 326 | 212 | 212 | |||
Net Income | 44,226 | 44,226 | |||
Other comprehensive income, net of tax | |||||
Foreign currency translation adjustments | 2,342 | 2,342 | |||
Cash dividends | (34,332) | (34,332) | |||
Stock compensation | $ 464 | 3,425 | 3,889 | ||
Stock compensation, Shares | 464,000 | ||||
Employee stock buybacks | $ (242) | (8,879) | (9,121) | ||
Employee stock buybacks, Shares | (242,000) | ||||
Ending Balance, Shares at Mar. 31, 2019 | 327,530,000 | ||||
Ending Balance at Mar. 31, 2019 | $ 327,530 | 79,932 | (68,736) | 380,398 | 719,124 |
Other comprehensive income, net of tax | |||||
Change in derivatives | |||||
Beginning Balance, Shares at Dec. 31, 2019 | 327,431,000 | ||||
Beginning Balance at Dec. 31, 2019 | $ 327,431 | 89,413 | (21,109) | 420,015 | 815,750 |
Impact of adoption of ASC 326 | 2,484 | 2,484 | |||
Net Income | 43,268 | 43,268 | |||
Other comprehensive income, net of tax | |||||
Foreign currency translation adjustments | (16,868) | (16,868) | |||
Cash dividends | (39,317) | (39,317) | |||
Stock compensation | $ 555 | 3,264 | 3,819 | ||
Stock compensation, Shares | 555,000 | ||||
Employee stock buybacks | $ (219) | (7,812) | (8,031) | ||
Employee stock buybacks, Shares | (219,000) | ||||
Ending Balance, Shares at Mar. 31, 2020 | 327,767,000 | ||||
Ending Balance at Mar. 31, 2020 | $ 327,767 | 84,865 | (38,711) | 426,450 | 800,371 |
Other comprehensive income, net of tax | |||||
Change in derivatives | $ (734) | $ (734) |
CONSOLIDATED STATEMENTS OF STAT
CONSOLIDATED STATEMENTS OF STATEMENT OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
OPERATING ACTIVITIES | ||
Net income | $ 43,268 | $ 44,226 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 21,597 | 16,683 |
Provision for deferred income taxes | 2,999 | 3,327 |
Provision for bad debts | 2,288 | 1,682 |
Stock-based compensation expense | 3,819 | 3,889 |
Other, net | (615) | (591) |
Changes in operating assets and liabilities | 18,607 | (7,794) |
Net cash provided by operating activities | 91,963 | 61,422 |
INVESTING ACTIVITIES | ||
Cash used for acquisitions of companies, net of cash acquired | (47,586) | (7,041) |
Purchases of equipment and property | (6,674) | (6,481) |
Proceeds from sales of franchises | 267 | 395 |
Other | 941 | 569 |
Net cash used in investing activities | (53,052) | (12,558) |
FINANCING ACTIVITIES | ||
Payment of contingent consideration | (2,040) | (2,807) |
Repayment of term loan | (35,700) | |
Borrowings on revolving commitment | 64,000 | |
Cash paid for common stock purchased | (8,031) | (9,121) |
Dividends paid | (39,317) | (34,332) |
Net cash used in financing activities | (21,088) | (46,260) |
Effect of exchange rate changes on cash | (19,517) | (1,482) |
Net (decrease)/increase in cash and cash equivalents | (1,694) | 1,122 |
Cash and cash equivalents at beginning of period | 94,276 | 115,485 |
Cash and cash equivalents at end of period | 92,582 | 116,607 |
Supplemental disclosure of cash flow information: | ||
Non-cash additions to operating lease right-of-use assets | $ 27,894 | $ 6,920 |
BASIS OF PREPARATION AND OTHER
BASIS OF PREPARATION AND OTHER | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
BASIS OF PREPARATION AND OTHER | NOTE 1. BASIS OF PREPARATION AND OTHER Basis of Preparation The preparation of interim financial statements requires management to make estimates and assumptions for the amounts reported in the condensed consolidated financial statements. Specifically, the Company makes estimates in its interim condensed consolidated financial statements for the termite accrual, which includes future costs including termiticide life expectancy and government regulations, the insurance accrual, which includes self-insurance and worker’s compensation, inventory adjustments, discounts and volume incentives earned, among others. The global response to the COVID-19 pandemic has triggered an economic downturn. The pest control industry has been designated as “essential” by the Department of Homeland Security and the Company has been able to remain operational in every part of the world in which it operates. The Company’s consolidated financial statements reflect estimates and assumptions made by management that affect the reported amounts of assets and liabilities and related disclosures as of the date of the condensed consolidated financial statements. The Company considered the impact of COVID-19 on the assumptions and estimates used in preparing the condensed consolidated financial statements, and it was determined that there were some adverse impacts on the Company’s results of the first quarter ended March 31, 2020. The Company’s business, results of operations and financial condition will be impacted by future developments related to the COVID-19 pandemic, but the magnitude of such impacts cannot be determined at this time. In the opinion of management, all adjustments necessary for a fair presentation of the Company’s financial results for the quarter have been made. These adjustments are of a normal recurring nature, but complicated by the uncertainty surrounding the global economic impact of the COVID-19 pandemic. We began to experience this impact in mid-March 2020 and expect it to persist and be more significant in the second quarter of 2020. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of results for the entire year. The Company has only one reportable segment, its pest and termite control business. The Company’s results of operations and its financial condition are not reliant upon any single customer, a few customers, or the Company’s foreign operations. The Company reclassified certain prior period amounts in the Statement of Cash Flows from Operating Activities to Financing Activities for payment of contingent consideration to conform to the current period presentation. |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | NOTE 2. RECENT ACCOUNTING PRONOUNCEMENTS Recently adopted accounting standards In June of 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (ASC 326): Measurement of Credit Losses on Financial Instruments.” The updated accounting guidance requires changes to the recognition of credit losses on financial instruments not accounted for at fair value through net income. The Company adopted ASU 2016-13 effective January The Company is exposed to credit losses primarily related to accounts receivables and financed receivables derived from customer services revenue. To reduce credit risk for residential pest control accounts receivable, we promote enrollment in our auto-pay programs. In general, we may suspend future services for customers with past due balances. The Company’s credit risk is generally low with a large number of entities comprising Rollins’ customer base and dispersion across many different geographical regions. ROLLINS, INC. AND SUBSIDIARIES The Company manages its financing receivables on an aggregate basis when assessing and monitoring credit risks. The credit quality of a potential obligor is evaluated at the loan origination based on an assessment of the individual’s Beacon/credit bureau score. Rollins requires a potential obligor to have good credit worthiness with low risk before entering into a contract. Depending upon the individual’s credit score, the Company may accept with 100% financing or require a significant down payment or turndown the contract. Delinquencies of accounts are monitored each month. Financing receivables include installment receivable amounts which are due subsequent to one year from the balance sheet dates. The Company’s allowances for credit losses for trade accounts receivable and financed receivables are developed using historical collection experience, current and economic and market conditions, reasonable and supportable forecasts, and a review of the current status of customers’ receivables. The Company’s receivable pools are classified between residential customers, commercial customers, large commercial customers, and financed receivables. Accounts are written-off against the allowance for doubtful accounts when the Company determines that amounts are uncollectible, and recoveries of amounts previously written off are recorded when collected. Below is a rollforward of the Company’s allowance for credit losses for the three months ended March 31, 2020. Schedule of Roll Forward of the Company's Allowance for Credit Losses Allowance for Doubtful Accounts Trade Financed Total Balance at January 1, 2020 $ 16,699 $ 2,959 $ 19,658 Adoption of ASC 326 (3,330 ) — (3,330 ) Adjusted balance at January 1, 2020 13,369 2,959 16,328 Provision for expected credit losses 1,553 734 2,287 Write-offs charged against the allowance (3,779 ) (640 ) (4,419 ) Recoveries collected 908 — 908 Currency conversion (190 ) — (190 ) Balance at March 31, 2020 $ 11,861 $ 3,053 $ 14,914 In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (ASC 350): Simplifying the Test for Goodwill Impairment, which eliminated the requirement to calculate the implied fair value of goodwill (i.e., Step 2 of the current goodwill impairment test) to measure a goodwill impairment charge. Instead, entities would record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on the current Step 1). The Company adopted ASU 2017-04 effective January 1, 2020. The Company does not expect the adoption of this standard to have a material impact on its future consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (ASC 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The updated accounting guidance modified the disclosure requirements on fair value measurements by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty and adding new disclosure requirements. The Company adopted ASU 2018-13 effective January 1, 2020 and the adoption did not materially impact its financial statement disclosures. ROLLINS, INC. AND SUBSIDIARIES Recently issued accounting standards to be adopted in 2021 or later In December, 2019, the FASB issued ASU No. 2019-12 Income Taxes (topic 740): Simplifying the Accounting for Income Taxes. The standard eliminates the need for an organization to analyze whether the following apply in a given period (1) exception to the incremental approach for intraperiod tax allocation (2) exceptions to accounting for basis differences when there are ownership changes in foreign investments and (3) exceptions in interim period income tax accounting for year-to-date losses that exceed anticipated losses. The ASU also is designed to improve financial statement preparers’ application of income tax-related guidance and simplify GAAP for (1) franchise taxes that are partially based on income, (2) transactions with a government that result in a step-up in the tax basis of goodwill, (3) separate financial statements of legal entities that are not subject to tax, and (4) enacted changes in tax laws in interim periods. The standard in this update is effective for the Company’s financial statements issued for fiscal years beginning in 2021. The adoption of this ASU is not expected to have a material impact on the Company’s consolidated financial statements. |
REVENUE
REVENUE | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | NOTE 3. REVENUE The following tables present our revenues disaggregated by revenue source (in thousands). Sales and usage-based taxes are excluded from revenues. No sales to an individual customer or in a country other than the United States accounted for more than 10% of the sales for the periods listed on the following table. Revenue, classified by the major geographic areas in which our customers are located (In thousands) Three Months Ended March 31, 2020 2019 United States $ 452,346 $ 394,000 Other countries 35,555 35,069 Total Revenues $ 487,901 $ 429,069 Revenue from external customers, classified by significant product and service offerings, was as follows: (In thousands) Three Months Ended March 31, 2020 2019 Residential revenue $ 204,657 $ 172,507 Commercial revenue 183,315 169,671 Termite completions, bait monitoring, & renewals 94,227 80,250 Franchise revenues 3,417 3,261 Other revenues 2,285 3,380 Total Revenues $ 487,901 $ 429,069 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | NOTE 4. EARNINGS PER SHARE The Company follows ASC 260, Earnings Per Share ROLLINS, INC. AND SUBSIDIARIES Basic and diluted earnings per share Three Months Ended March 31, 2020 2019 Basic and diluted earnings per share Common stock $ 0.13 $ 0.14 Restricted shares of common stock $ 0.12 $ 0.12 |
CONTINGENCIES
CONTINGENCIES | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | NOTE 5. CONTINGENCIES In the normal course of business, certain of the Company’s subsidiaries are defendants in a number of lawsuits, claims or arbitrations which allege that the subsidiaries’ services caused damage. In addition, the Company defends employment-related cases and claims from time to time. We are involved in certain environmental matters primarily arising in the normal course of business. We are actively contesting each of these matters. Management does not believe that any pending claim, proceeding or litigation, either alone or in the aggregate will have a material adverse effect on the Company’s financial position, results of operations or liquidity; however, it is possible that an unfavorable outcome of some or all of the matters, however unlikely, could result in a charge that might be material to the results of an individual quarter or year. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | NOTE 6. FAIR VALUE OF FINANCIAL INSTRUMENTS The Company’s financial instruments consist of cash and cash equivalents, trade receivables, notes receivable, accounts payable and other short-term liabilities. The carrying amounts of these financial instruments approximate their respective fair values. At March 31, 2020 and 2019, the Company had $51.3 million and $29.0 million of acquisition holdback and earnout liabilities with the former owners of acquired companies. The earnout liabilities were discounted to reflect the expected probability of payout, and both earnout and holdback liabilities were discounted to their net present value on the Company’s books and are considered level 3 liabilities. The table below presents a summary of the changes in fair value for these liabilities. T he table below presents a summary of the changes in fair value for these liabilities. Three Months Ended March 31, (in thousands) 2020 2019 Beginning $ 49,131 $ 30,926 New acquisitions and revaluations 4,489 1,557 Payouts (2,040 ) (2,807 ) Interest on outstanding contingencies 583 212 Charge offset, forfeit and other (835 ) (889 ) Ending Balance $ 51,328 $ 28,999 |
UNEARNED REVENUE
UNEARNED REVENUE | 3 Months Ended |
Mar. 31, 2020 | |
Unearned Revenue | |
UNEARNED REVENUE | NOTE 7. UNEARNED REVENUE Revenue allocated to remaining performance obligations represents contracted revenue that has not yet been recognized (“contracted not recognized revenue”), which includes both unearned revenue and revenue that will be invoiced and recognized in future periods. Deferred revenue recognized in the three months ended March 31, 2020 and 2019 were $42.7 million and $40.0 million, respectively. Changes in unearned revenue were as follows: C hanges in unearned revenue were as follows: Three Months Ended (in thousands) 2020 2019 Balance at beginning of year $ 136,507 $ 127,075 Deferral of unearned revenue 49,552 47,737 Recognition of unearned revenue (42,707 ) (39,958 ) Balance at end of period $ 143,352 $ 134,854 The Company has no material contracted, but not recognized revenue as of March 31, 2020 or December 31, 2019. At March 31, 2020 and December 31, 2019, the Company had long-term unearned revenue of $ 14.0 13.7 five years |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2020 | |
Leases | |
LEASES | NOTE 8. LEASES The Company leases certain buildings, vehicles, and equipment in order to reduce the risk associated with ownership. The Company elected the practical expedient approach permitted under ASC 842 not to include short-term leases with a duration of 12 months or less on the balance sheet. As of March 31, 2020 and December 31, 2019, all leases were classified as operating leases. Building leases generally carry terms of 5 to 10 years with annual rent escalations at fixed amounts per the lease. Vehicle leases generally carry a fixed term of one year with renewal options to extend the lease on a monthly basis resulting in lease terms up to 5 years depending on the class of vehicle. The exercise of renewal options is at the Company’s sole discretion. It is reasonably certain that the Company will exercise the renewal options on its vehicle leases. The measurement of right-of-use assets and liabilities for vehicle leases includes the fixed payments associated with such renewal periods. We separate lease and non-lease components of contracts. Our lease agreements do not contain any material variable payments, residual value guarantees, early termination penalties or restrictive covenants. The Company uses the rate implicit in the lease when available; however, most of our leases do not provide a readily determinable implicit rate. Accordingly, we estimate our incremental borrowing rate based on information available at lease commencement. (in thousands) Lease Classification Financial Statement Classification Three Months Ended Short-term lease cost Cost of services provided, Sales, general, and administrative expenses 76 Operating lease cost Cost of services provided, Sales, general, and administrative expenses 20,717 Total lease expense 20,793 Other Information Weighted-average remaining lease term – operating leases 3.84 Weighted-average discount rate – operating leases 3.93 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases 20,477 ROLLINS, INC. AND SUBSIDIARIES Lease Commitments Future minimum lease payments, including assumed exercise of renewal options (in thousands) Operating Leases 2020 (excluding the three months ended March 31, 2020) $ 58,250 2021 65,533 2022 47,137 2023 27,744 2024 11,624 2025 7,382 Thereafter 10,723 Total Future Minimum Lease Payments 228,393 Less: Amount representing interest 19,147 Total future minimum lease payments, net of interest $ 209,246 Total future minimum lease payments for operating leases, including the amount representing interest, are comprised of $ 96.8 131.6 Future commitments presented in the table above exclude lease payments in renewal periods for which it is reasonably certain that the Company will exercise the renewal option. |
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 9. DEBT The Company entered into a Credit Agreement with SunTrust Bank and Bank of America, N.A. for an unsecured Revolving Commitment of up to $ 175.0 75.0 25.0 250.0 133.0 186.8 101.5 190.0 The Credit Agreement includes a debt covenant that requires the Company’s leverage ratio to be no greater than 3.00:1.00. The Leverage Ratio is calculated as of the last day of the fiscal quarter most recently ended. |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | NOTE 10. STOCKHOLDERS’ EQUITY During the three months ended March 31, 2020, the Company paid $39.3 million or $ 0.12 The Company did not repurchase shares on the open market during either of the first quarters ended March 31, 2020 or 2019. ROLLINS, INC. AND SUBSIDIARIES The Company repurchases shares from employees for the payment of their taxes on restricted shares that have vested. The Company repurchased $ 8.0 9.1 As more fully discussed in Note 17 of the Company’s notes to the consolidated financial statements in its 2019 Annual Report on Form 10-K, time-lapse restricted shares and restricted stock units have been issued to officers and other management employees under the Company’s Employee Stock Incentive Plans. The Company issues new shares from its authorized but unissued share pool. At March 31, 2020, approximately 4.9 million shares of the Company’s common stock were reserved for issuance. Time Lapse Restricted Shares and Restricted Stock Units The following table summarizes the components of the Company’s stock-based compensation Three Months Ended March 31, (in thousands) 2020 2019 Time lapse restricted stock: Pre-tax compensation expense $ 3,819 $ 3,889 Tax benefit (837 ) (821 ) Restricted stock expense, net of tax $ 2,982 $ 3,068 - The following table summarizes information on unvested restricted stock Number of Average Grant- Unvested Restricted Stock at December 31, 2019 2,310 $ 25.84 Forfeited (16 ) 24.28 Vested (626 ) 19.76 Granted 572 36.73 Unvested Restricted Stock at March 31, 2020 2,240 $ 30.42 At March 31, 2020 and December 31, 2019, the Company had $ 58.1 41.3 4.4 4.0 |
PENSION AND POST RETIREMENT BEN
PENSION AND POST RETIREMENT BENEFIT PLAN | 3 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
PENSION AND POST RETIREMENT BENEFIT PLAN | NOTE 11. PENSION AND POST RETIREMENT BENEFIT PLAN During September 2019, the Company settled its fully-funded pension plan. At December 31, 2019, $21.6 million of pension assets remained available to fund other employee benefits. The Company used $5.9 million to fund its 401(k)-match obligation during the quarter ended March 31, 2020, and plans to continue funding future benefit plan obligations, with a possible reversion of any remaining pension assets to the Company per ERISA regulations. As of March 31, 2020, the Company had approximately $ 15.6 ROLLINS, INC. AND SUBSIDIARIES Components of Net Pension Benefit Loss/(Gain) Three Months Ended (in thousands) 2020 2019 Interest and service cost $ 25 $ 924 Expected return on plan assets (35 ) (30 ) Amortization of net loss 25 892 Net periodic benefit $ 15 $ 1,786 During the three months ended March 31, 2020, and the same period in 2019, the Company made no contributions to its defined benefit retirement plans (the “Plans”). The Company made no contributions for the year ended December 31, 2019. |
BUSINESS COMBINATIONS
BUSINESS COMBINATIONS | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATIONS | NOTE 12. BUSINESS COMBINATIONS The Company made seven 30 Schedule of Assets Acquired and Liabilities assumed recorded at the date of acquisition. March 31, 2020 Accounts receivable, net $ 1,556 Materials and supplies 103 Equipment and property 2,850 Goodwill 26,505 Customer contracts 22,027 Other intangible assets 3,029 Current liabilities (6,827 ) Other assets and liabilities, net 2,987 Total consideration paid $ 52,230 Less: Contingent consideration liability (4,644 ) Total cash purchase price $ 47,586 Goodwill from acquisitions represents the excess of the purchase price over the fair value of net assets of businesses acquired. For the three-month period ending March 31, 2020, $26.5 million of goodwill was added related to the seven acquisitions noted above. The cumulative carrying amount of goodwill was $596.1 million and $572.8 million at March 31, 2020 and December 31, 2019, respectively. Goodwill generally changes due to the timing of acquisitions, finalization of allocation of purchase prices of previous acquisitions and foreign currency translations. The carrying amount of goodwill in foreign countries was $ 53.9 55.8 The Company completed its most recent annual impairment analysis as of September 30, 2019. Based upon the results of this analysis, the Company has concluded that no impairment of its goodwill or other intangible assets was indicated. The carrying amount of customer contracts was $ 279.4 million and $ 273.7 million at March 31, 2020 and December 31, 2019, respectively. The carrying amount of trademarks and tradenames was $ 104.9 million and $ 102.5 million at March 31, 2020 and December 31, 2019, respectively. The carrying amount of other intangible assets was $ 10.3 and $ 10.5 million at March 31, 2020 and December 31, 2019, respectively. The carrying amount of customer contracts in foreign countries was $ 32.9 million and $ 33.5 million at March 31, 2020 and December 31, 2019, respectively. The carrying amount of trademarks and tradenames in foreign countries was $3.1 3.4 1.0 1.2 ROLLINS, INC. AND SUBSIDIARIES Customer contracts and other amortizable intangible assets are amortized on a straight-line basis over their economic useful lives. The following table sets forth the components of intangible assets Intangible Asset Carrying Useful Life Customer contracts $ 279,361 3 12 Trademarks and tradenames 104,863 N/A- 20 Non-compete agreements 4,505 3 20 Patents 1,461 3 15 Other assets 2,121 10 Internet domains 2,227 N/A Total customer contracts and other intangible assets $ 394,538 |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | NOTE 13. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES Risk Management Objective of Using Derivatives The Company is exposed to certain interest rate risks on our outstanding debt and foreign currency risks arising from our international business operations and global economic conditions. The Company enters into certain derivative financial instruments to lock in certain interest rates, as well as to protect the value or fix the amount of certain obligations in terms of its functional currency, the U.S. dollar. Cash Flow Hedges of Interest Rate Risk The Company uses interest rate swap arrangements to manage or hedge its interest rate risk. Notwithstanding the terms of the swaps, the Company is ultimately obligated for all amounts due and payable under the Revolving Commitment and the Term Loan (“Credit Facility”). The Company does not use such instruments for speculative or trading purposes. On June 19, 2019, the Company entered into a floating-to-fixed interest rate swap for an aggregate notional amount of $80.0 million in order to hedge a portion of the Company’s floating rate indebtedness under the Credit Facility. The Company designated the swap as a cash flow hedge. The swap requires us to pay a fixed rate of 1.94% per annum on the notional amount. The cash flows from the swap began June 30, 2019 and ends on December 31, 2021. As of December 31, 2019, $0.3 million had been recorded as an Accumulated Loss in Other Comprehensive Income (“AOCI”). An additional loss of $0.7 million was recorded in AOCI in the three months ending March 31, 2020. Realized gains and losses in connection with each required interest payment are reclassified from AOCI to interest expense during the period of the cash flows. During the first three months as of March 31, 2020, $0.1 million was recorded as interest income to offset the floating rate interest expense on our Credit Facility. The fair value of the Company’s interest rate swaps was recorded as $0.8 million in Other Current Liabilities and $0.2 in Long-Term Liabilities for a combined obligation of $1.0 million at March 31, 2020. The fair value of the Company’s interest rate swaps was recorded as $0.2 million in Other Current Liabilities and $0.1 in Long-Term Liabilities for a combined obligation of $0.3 million at December 31, 2019. On a quarterly basis, management evaluates any swap agreement to determine its effectiveness or ineffectiveness and records the change in fair value as an adjustment to AOCI. Management intends that the swap remains effective. ROLLINS, INC. AND SUBSIDIARIES Hedges of Foreign Exchange Risk The Company is exposed to fluctuations in various foreign currencies against its functional currency, the US dollar. We use foreign currency derivatives, specifically vanilla foreign currency forward contracts (“FX Forwards”), to manage our exposure to fluctuations in the USD-CAD and AUD-USD exchange rates. FX Forwards involve fixing the foreign currency exchange rate for delivery of a specified amount of foreign currency on a specified date. The FX Forwards are typically settled in US dollars for their fair value at or close to their settlement date. We do not currently designate any of these FX Forwards under hedge accounting, but rather reflect the changes in fair value immediately in earnings. We do not use such instruments for speculative or trading purposes, but rather use them to manage our exposure to foreign exchange rates. Changes in the fair value of FX Forwards recorded in other income/expense and were equal to a net gain of $1.1 million for the three months ended March 31, 2020 and a net loss of $0.1 million for the three months ending March 31, 2019. The fair value of the Company’s FX Forwards was recorded as $0.6 million in Other Current Assets at March 31, 2020 and was a net obligation of $0.2 million in Other Current Liabilities at December 31, 2019. As of March 31, 2020, the Company had the following outstanding FX Forwards (in thousands except for number of instruments): Non-Designated Derivative Summary FX Forward Contracts Number of Sell Buy Sell AUD/Buy USD Fwd Contract 4 $ 600 $ 416 Sell CAD/Buy USD Fwd Contract 10 $ 12,000 $ 9,127 Total 14 $ 9,543 The financial statement impact related to these derivative instruments was insignificant for the 3 months ended March 31, 2020 and year ended December 31, 2019. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 14. SUBSEQUENT EVENTS On April 28, 2020, the Company announced that the Board of Directors declared a regular quarterly cash dividend on its common stock of $ 0.08 |
BASIS OF PREPARATION AND OTHER
BASIS OF PREPARATION AND OTHER (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Preparation | Basis of Preparation The preparation of interim financial statements requires management to make estimates and assumptions for the amounts reported in the condensed consolidated financial statements. Specifically, the Company makes estimates in its interim condensed consolidated financial statements for the termite accrual, which includes future costs including termiticide life expectancy and government regulations, the insurance accrual, which includes self-insurance and worker’s compensation, inventory adjustments, discounts and volume incentives earned, among others. The global response to the COVID-19 pandemic has triggered an economic downturn. The pest control industry has been designated as “essential” by the Department of Homeland Security and the Company has been able to remain operational in every part of the world in which it operates. The Company’s consolidated financial statements reflect estimates and assumptions made by management that affect the reported amounts of assets and liabilities and related disclosures as of the date of the condensed consolidated financial statements. The Company considered the impact of COVID-19 on the assumptions and estimates used in preparing the condensed consolidated financial statements, and it was determined that there were some adverse impacts on the Company’s results of the first quarter ended March 31, 2020. The Company’s business, results of operations and financial condition will be impacted by future developments related to the COVID-19 pandemic, but the magnitude of such impacts cannot be determined at this time. In the opinion of management, all adjustments necessary for a fair presentation of the Company’s financial results for the quarter have been made. These adjustments are of a normal recurring nature, but complicated by the uncertainty surrounding the global economic impact of the COVID-19 pandemic. We began to experience this impact in mid-March 2020 and expect it to persist and be more significant in the second quarter of 2020. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of results for the entire year. The Company has only one reportable segment, its pest and termite control business. The Company’s results of operations and its financial condition are not reliant upon any single customer, a few customers, or the Company’s foreign operations. The Company reclassified certain prior period amounts in the Statement of Cash Flows from Operating Activities to Financing Activities for payment of contingent consideration to conform to the current period presentation. |
RECENT ACCOUNTING PRONOUNCEME_2
RECENT ACCOUNTING PRONOUNCEMENTS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of Roll Forward of the Company's Allowance for Credit Losses | Schedule of Roll Forward of the Company's Allowance for Credit Losses |
RECENT ACCOUNTING PRONOUNCEMENTS | Allowance for Doubtful Accounts Trade Financed Total Balance at January 1, 2020 $ 16,699 $ 2,959 $ 19,658 Adoption of ASC 326 (3,330 ) — (3,330 ) Adjusted balance at January 1, 2020 13,369 2,959 16,328 Provision for expected credit losses 1,553 734 2,287 Write-offs charged against the allowance (3,779 ) (640 ) (4,419 ) Recoveries collected 908 — 908 Currency conversion (190 ) — (190 ) Balance at March 31, 2020 $ 11,861 $ 3,053 $ 14,914 |
REVENUE (Tables)
REVENUE (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, classified by the major geographic areas in which our customers are located | Sales and usage-based taxes are excluded from revenues. No sales to an individual customer or in a country other than the United States accounted for more than 10% of the sales for the periods listed on the following table. Revenue, classified by the major geographic areas in which our customers are located |
REVENUE | (In thousands) Three Months Ended March 31, 2020 2019 United States $ 452,346 $ 394,000 Other countries 35,555 35,069 Total Revenues $ 487,901 $ 429,069 |
REVENUE (Details 2) | (In thousands) Three Months Ended March 31, 2020 2019 Residential revenue $ 204,657 $ 172,507 Commercial revenue 183,315 169,671 Termite completions, bait monitoring, & renewals 94,227 80,250 Franchise revenues 3,417 3,261 Other revenues 2,285 3,380 Total Revenues $ 487,901 $ 429,069 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Basic and diluted earnings per share | Basic and diluted earnings per share |
EARNINGS PER SHARE | Three Months Ended March 31, 2020 2019 Basic and diluted earnings per share Common stock $ 0.13 $ 0.14 Restricted shares of common stock $ 0.12 $ 0.12 |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
he table below presents a summary of the changes in fair value for these liabilities. | T he table below presents a summary of the changes in fair value for these liabilities. |
FAIR VALUE OF FINANCIAL INSTRUMENTS | Three Months Ended March 31, (in thousands) 2020 2019 Beginning $ 49,131 $ 30,926 New acquisitions and revaluations 4,489 1,557 Payouts (2,040 ) (2,807 ) Interest on outstanding contingencies 583 212 Charge offset, forfeit and other (835 ) (889 ) Ending Balance $ 51,328 $ 28,999 |
UNEARNED REVENUE (Tables)
UNEARNED REVENUE (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Unearned Revenue | |
hanges in unearned revenue were as follows: | C hanges in unearned revenue were as follows: |
UNEARNED REVENUE | Three Months Ended (in thousands) 2020 2019 Balance at beginning of year $ 136,507 $ 127,075 Deferral of unearned revenue 49,552 47,737 Recognition of unearned revenue (42,707 ) (39,958 ) Balance at end of period $ 143,352 $ 134,854 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases | |
Schedule of Leave Classification [Table Text Block] | |
Lease Classification | (in thousands) Lease Classification Financial Statement Classification Three Months Ended Short-term lease cost Cost of services provided, Sales, general, and administrative expenses 76 Operating lease cost Cost of services provided, Sales, general, and administrative expenses 20,717 Total lease expense 20,793 Other Information Weighted-average remaining lease term – operating leases 3.84 Weighted-average discount rate – operating leases 3.93 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases 20,477 |
Future minimum lease payments, including assumed exercise of renewal options | Future minimum lease payments, including assumed exercise of renewal options |
LEASES (Details 2) | (in thousands) Operating Leases 2020 (excluding the three months ended March 31, 2020) $ 58,250 2021 65,533 2022 47,137 2023 27,744 2024 11,624 2025 7,382 Thereafter 10,723 Total Future Minimum Lease Payments 228,393 Less: Amount representing interest 19,147 Total future minimum lease payments, net of interest $ 209,246 |
STOCKHOLDERS_ EQUITY (Tables)
STOCKHOLDERS’ EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
components of the Company’s stock-based compensation | The following table summarizes the components of the Company’s stock-based compensation |
STOCKHOLDERS' EQUITY | Three Months Ended March 31, (in thousands) 2020 2019 Time lapse restricted stock: Pre-tax compensation expense $ 3,819 $ 3,889 Tax benefit (837 ) (821 ) Restricted stock expense, net of tax $ 2,982 $ 3,068 |
unvested restricted stock | - The following table summarizes information on unvested restricted stock |
STOCKHOLDERS' EQUITY (Details 2) | Number of Average Grant- Unvested Restricted Stock at December 31, 2019 2,310 $ 25.84 Forfeited (16 ) 24.28 Vested (626 ) 19.76 Granted 572 36.73 Unvested Restricted Stock at March 31, 2020 2,240 $ 30.42 |
PENSION AND POST RETIREMENT B_2
PENSION AND POST RETIREMENT BENEFIT PLAN (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
Components of Net Pension Benefit Loss/(Gain) | Components of Net Pension Benefit Loss/(Gain) |
PENSION AND POST RETIREMENT BENEFIT PLAN | Three Months Ended (in thousands) 2020 2019 Interest and service cost $ 25 $ 924 Expected return on plan assets (35 ) (30 ) Amortization of net loss 25 892 Net periodic benefit $ 15 $ 1,786 |
BUSINESS COMBINATIONS (Tables)
BUSINESS COMBINATIONS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Schedule of Assets Acquired and Liabilities assumed recorded at the date of acquisition. | Schedule of Assets Acquired and Liabilities assumed recorded at the date of acquisition. |
BUSINESS COMBINATIONS | March 31, 2020 Accounts receivable, net $ 1,556 Materials and supplies 103 Equipment and property 2,850 Goodwill 26,505 Customer contracts 22,027 Other intangible assets 3,029 Current liabilities (6,827 ) Other assets and liabilities, net 2,987 Total consideration paid $ 52,230 Less: Contingent consideration liability (4,644 ) Total cash purchase price $ 47,586 |
components of intangible assets | Customer contracts and other amortizable intangible assets are amortized on a straight-line basis over their economic useful lives. The following table sets forth the components of intangible assets |
BUSINESS COMBINATIONS (Details 2) | Intangible Asset Carrying Useful Life Customer contracts $ 279,361 3 12 Trademarks and tradenames 104,863 N/A- 20 Non-compete agreements 4,505 3 20 Patents 1,461 3 15 Other assets 2,121 10 Internet domains 2,227 N/A Total customer contracts and other intangible assets $ 394,538 |
DERIVATIVE INSTRUMENTS AND HE_2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | Non-Designated Derivative Summary FX Forward Contracts Number of Sell Buy Sell AUD/Buy USD Fwd Contract 4 $ 600 $ 416 Sell CAD/Buy USD Fwd Contract 10 $ 12,000 $ 9,127 Total 14 $ 9,543 |
RECENT ACCOUNTING PRONOUNCEME_3
RECENT ACCOUNTING PRONOUNCEMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Balance at January 1, 2020 | $ 19,658 | |
Adoption of ASC 326 | $ (3,330) | |
Adjusted Balance | 16,328 | |
Provision for expected credit losses | 2,287 | |
Write-offs charged against the allowance | (4,419) | |
Recoveries collected | 908 | |
Currency conversion | (190) | |
Balance at March 31, 2020 | 14,914 | |
Trade Accounts Receivable [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Balance at January 1, 2020 | 16,699 | |
Adoption of ASC 326 | (3,330) | |
Adjusted Balance | 13,369 | |
Provision for expected credit losses | 1,553 | |
Write-offs charged against the allowance | (3,779) | |
Recoveries collected | 908 | |
Currency conversion | (190) | |
Balance at March 31, 2020 | 11,861 | |
Financing Receivable [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Balance at January 1, 2020 | 2,959 | |
Adoption of ASC 326 | ||
Adjusted Balance | $ 2,959 | |
Provision for expected credit losses | 734 | |
Write-offs charged against the allowance | (640) | |
Recoveries collected | ||
Currency conversion | ||
Balance at March 31, 2020 | $ 3,053 |
REVENUE (Details)
REVENUE (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 487,901 | $ 429,069 |
UNITED STATES | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 452,346 | 394,000 |
Non-US [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 35,555 | $ 35,069 |
REVENUE (Details 2)
REVENUE (Details 2) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 487,901 | $ 429,069 |
Residential Contract Revenue [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 204,657 | 172,507 |
Commercial Contract Revenue [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 183,315 | 169,671 |
Termite completions, bait monitoring, & renewals [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 94,227 | 80,250 |
Franchise Revenues [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | 3,417 | 3,261 |
Other Revenues [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 2,285 | $ 3,380 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||
Earning Per Share | $ 0.13 | $ 0.14 |
Common Stock [Member] | ||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||
Earning Per Share | 0.13 | 0.14 |
Restricted Stock [Member] | ||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||
Earning Per Share | $ 0.12 | $ 0.12 |
FAIR VALUE OF FINANCIAL INSTR_3
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Payouts | $ (2,040) | $ (2,807) |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Beginning | 49,131 | 30,926 |
New acquisitions and revaluations | 4,489 | 1,557 |
Payouts | (2,040) | (2,807) |
Interest on outstanding contingencies | 583 | 212 |
Charge offset, forfeit and other | (835) | (889) |
Ending Balance | $ 51,328 | $ 28,999 |
UNEARNED REVENUE (Details)
UNEARNED REVENUE (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Unearned Revenue | ||
Balance at beginning of year | $ 136,507 | $ 127,075 |
Deferral of unearned revenue | 49,552 | 47,737 |
Recognition of unearned revenue | (42,707) | (39,958) |
Balance at end of period | $ 143,352 | $ 134,854 |
UNEARNED REVENUE (Details Narra
UNEARNED REVENUE (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Unearned Revenue | ||
Long-term unearned revenue | $ 14,000 | $ 13,700 |
Long-term unearned revenue, recognition period (or less) | 5 years |
LEASES (Details)
LEASES (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Leases | |
Short-term lease cost | $ 76 |
Operating lease cost | 20,717 |
Total lease expense | $ 20,793 |
Weighted-average remaining lease term - operating leases | 3 years 10 months 2 days |
Weighted-average discount rate - operating leases | 3.93% |
Operating cash flows for operating leases | $ 20,477 |
LEASES (Details 2)
LEASES (Details 2) $ in Thousands | Mar. 31, 2020USD ($) |
Leases | |
2020 (excluding the three months ended March 31, 2020) | $ 58,250 |
2021 | 65,533 |
2022 | 47,137 |
2023 | 27,744 |
2024 | 11,624 |
2025 | 7,382 |
Thereafter | 10,723 |
Total Future Minimum Lease Payments | 228,393 |
Less: Amount representing interest | 19,147 |
Total future minimum lease payments, net of interest | $ 209,246 |
LEASES (Details Narrative)
LEASES (Details Narrative) $ in Thousands | Mar. 31, 2020USD ($) |
Property, Plant and Equipment [Line Items] | |
Future minimum lease payments | $ 228,393 |
Building [Member] | |
Property, Plant and Equipment [Line Items] | |
Future minimum lease payments | 96,800 |
Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Future minimum lease payments | $ 131,600 |
DEBT (Details Narrative)
DEBT (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Line of Credit Facility [Line Items] | ||
Debt Instrument, Restrictive Covenants | The Credit Agreement includes a debt covenant that requires the Company’s leverage ratio to be no greater than 3.00:1.00. The Leverage Ratio is calculated as of the last day of the fiscal quarter most recently ended. | |
Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Long-term Line of Credit | $ 133,000 | $ 101,500 |
Revolving Credit Facility [Member] | Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | 175,000 | |
Revolving Credit Facility [Member] | Letter of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | 75,000 | |
Revolving Credit Facility [Member] | Swingline Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | 25,000 | |
SunTrust Bank and Bank of America, [Member] | ||
Line of Credit Facility [Line Items] | ||
Long-term Line of Credit | 250,000 | |
Term Loan [Member] | ||
Line of Credit Facility [Line Items] | ||
Long-term Line of Credit | $ 186,800 | $ 190,000 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Time lapse restricted stock: | ||
Pre-tax compensation expense | $ 3,819 | $ 3,889 |
Tax benefit | (837) | (821) |
Restricted stock expense, net of tax | $ 2,982 | $ 3,068 |
STOCKHOLDERS' EQUITY (Details 2
STOCKHOLDERS' EQUITY (Details 2) | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Equity [Abstract] | |
Balance outstanding at the beginning of the period (in shares) | shares | 2,310 |
Balance at the beginning of the period (in dollars per share) | $ / shares | $ 25.84 |
Forfeited (in shares) | shares | (16) |
Forfeited (in dollars per share) | $ / shares | $ 24.28 |
Vested (in shares) | shares | (626) |
Vested (in dollars per share) | $ / shares | $ 19.76 |
Granted (in shares) | shares | 572 |
Granted (in dollars per share) | $ / shares | $ 36.73 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number, Ending Balance | shares | 2,240 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value, Ending Balance | $ / shares | $ 30.42 |
STOCKHOLDERS_ EQUITY (Details N
STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Equity [Abstract] | |||
Common Stock, Dividends, Per Share, Cash Paid | $ 0.12 | $ 0.11 | |
Shares Repurchased | $ 8,000 | $ 9,100 | |
Unrecognized compensation cost | $ 58,100 | $ 41,300 | |
Unrecognized compensation cost, period for recognition | 4 years 4 months 24 days | 4 years |
PENSION AND POST RETIREMENT B_3
PENSION AND POST RETIREMENT BENEFIT PLAN (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Retirement Benefits [Abstract] | ||
Interest and service cost | $ 25 | $ 924 |
Expected return on plan assets | (35) | (30) |
Amortization of net loss | 25 | 892 |
Net periodic benefit | $ 15 | $ 1,786 |
PENSION AND POST RETIREMENT B_4
PENSION AND POST RETIREMENT BENEFIT PLAN (Details Narrative) $ in Thousands | Mar. 31, 2020USD ($) |
Retirement Benefits [Abstract] | |
Remaining Pension Assets | $ 15,600 |
BUSINESS COMBINATIONS (Details)
BUSINESS COMBINATIONS (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||
Materials and supplies | $ 21,527 | $ 19,476 |
Goodwill | 596,067 | $ 572,847 |
Acquisitions [Member] | ||
Business Acquisition [Line Items] | ||
Accounts receivable, net | 1,556 | |
Materials and supplies | 103 | |
Equipment and property | 2,850 | |
Goodwill | 26,505 | |
Customer contracts | 22,027 | |
Other intangible assets | 3,029 | |
Current liabilities | (6,827) | |
Other assets and liabilities, net | 2,987 | |
Total consideration paid | 52,230 | |
Less: Contingent consideration liability | (4,644) | |
Total cash purchase price | $ 47,586 |
BUSINESS COMBINATIONS (Details
BUSINESS COMBINATIONS (Details 2) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived Intangible Assets Acquired | $ 394,538 |
Customer Contracts [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived Intangible Assets Acquired | $ 279,361 |
Customer Contracts [Member] | Minimum [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 3 years |
Customer Contracts [Member] | Maximum [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 12 years |
Trademarks and Trade Names [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived Intangible Assets Acquired | $ 104,863 |
Finite lived intangible assets useful life | 20 years |
Noncompete Agreements [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived Intangible Assets Acquired | $ 4,505 |
Noncompete Agreements [Member] | Minimum [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 3 years |
Noncompete Agreements [Member] | Maximum [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 20 years |
Patents [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived Intangible Assets Acquired | $ 1,461 |
Finite lived intangible assets useful life | 3 years |
Patents [Member] | Maximum [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite lived intangible assets useful life | 15 years |
Other Intangible Assets [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived Intangible Assets Acquired | $ 2,121 |
Finite lived intangible assets useful life | 10 years |
Internet Domain Names [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Finite-lived Intangible Assets Acquired | $ 2,227 |
BUSINESS COMBINATIONS (Detail_2
BUSINESS COMBINATIONS (Details Narrative) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020USD ($)Number | Dec. 31, 2019USD ($)Number | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Number of acquisitions | Number | 7 | 30 |
Carrying Amount of Goodwill in Foreign Countries | $ 53,900 | $ 55,800 |
Customer Contracts [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Carrying Amount of Goodwill in Foreign Countries | 32,900 | 33,500 |
Intangible Assets, Net (Excluding Goodwill) | 279,400 | 273,700 |
Trademarks and Trade Names [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Carrying Amount of Goodwill in Foreign Countries | 3,400 | |
Intangible Assets, Net (Excluding Goodwill) | 104,900 | 102,500 |
Other Intangible Assets [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Carrying Amount of Goodwill in Foreign Countries | 1,000 | 1,200 |
Intangible Assets, Net (Excluding Goodwill) | $ 10,300 | $ 10,500 |
DERIVATIVE INSTRUMENTS AND HE_3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details) $ in Thousands | Dec. 31, 2019USD ($)Franchise |
Not Designated as Hedging Instrument [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Derivative, Number of Instruments Held | Franchise | 14 |
Buy Notional | $ 9,543 |
Sell AUD/Buy USD Fwd Contract [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Derivative, Number of Instruments Held | Franchise | 4 |
Sell Notional | $ 600 |
Buy Notional | $ 416 |
Sell CAD/Buy USD Fwd Contract [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Derivative, Number of Instruments Held | Franchise | 10 |
Sell Notional | $ 12,000 |
Buy Notional | $ 9,127 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) | Apr. 28, 2020$ / shares |
Subsequent Event [Member] | |
Subsequent Event [Line Items] | |
Dividend declared quarterly (in dollars per share) | $ 0.08 |