ABM reported a solid Q3 2024, underscoring the resilience of its diversified facility-solutions platform. Revenue of $2.094B rose 3.3% year over year, with organic growth of 2.8% and contribution from the Quality Uptime Services acquisition in Technical Solutions. Adjusted EPS of $0.94 beat internal expectations, supported by margin gains across key segments (Aviation, ATS, and M&D) and a disciplined cost base. Management reaffirmed ABM’s cash-generative, asset-light model and raised full-year guidance, signaling confidence in a constructive late-2024 trajectory despite ongoing CRE headwinds.
The quarter showcased breadth of strength: Aviation revenue up 13% with margins expanding to 6.6%; Technical Solutions up 25% on strong microgrid activity and improved profitability (8.5% margin); Education remained solid, and B&I weathered a soft CRE environment with a 1% decline but stable margins. The company highlighted its workforce-productivity technology (WPO) as a meaningful margin lever and reiterated a disciplined capital-allocation stance (acquisition of Quality Uptime Services for ~$118M, ongoing share repurchases, and a plan to retire excess capital into high-return opportunities).
Looking ahead, ABM raised FY2024 adjusted EPS to $3.48–$3.55 (from $3.40–$3.50), with adjusted EBITDA margin near 6.3% and normalized free cash flow near the top end of $240–$270M (excluding ~$45M of ELEVATE/integration costs). Management emphasized continued cross-sell opportunities, secular growth in data-center and energy-resiliency markets, and a potential rebound in certain CRE demand signals over the next 12–18 months. Investors should monitor (i) the cadence of M&D rebalancing and its impact on near-term growth, (ii) RavenVolt backlog visibility and project timing, (iii) further advances in ABM’s analytics-enabled productivity tools, and (iv) the trajectory of data-center-related services as AI and edge-compute demand scales.