BrightView Reports Fourth Quarter and Full Year Fiscal 2023 Results

Rhea-AI Summary

BrightView Holdings, Inc. (NYSE: BV) reported a 2.8% increase in total revenue to a record $743.7 million in the fourth quarter. Net income rose by 7.2% to $16.4 million, and adjusted EBITDA increased by 11.3% to $101.6 million. The company also provided fiscal year 2024 guidance, expecting total revenue of $2.825 - $2.975 million and adjusted EBITDA of $310 - $340 million.

Positive

• Record fourth-quarter revenue and net income growth
• Significant decrease in total net financial debt and debt-to-EBITDA ratio
• Successful execution of key initiatives, including deleveraging the balance sheet and prioritizing profitable growth

Negative

• Decrease in organic snow removal services revenue year-over-year
• Decrease in adjusted net income and adjusted earnings per share

• Fourth quarter total revenue increased 2.8% year-over-year to a fourth quarter record $743.7 million.
• Fourth quarter net income increased 7.2% year-over-year to $16.4 million; Net income margin expanded by 10 basis points.
• Fourth quarter Adjusted EBITDA increased 11.3% year-over-year to a fourth quarter record $101.6 million; Adjusted EBITDA margin expanded by 110 basis points.
• Full year net cash provided by operating activities increased 35.9% year-over-year to $129.9 million.
• Full year free cash flow increased $73.5 million year-over-year to $80.2 million. Reduced full year Total Net Financial Debt to Adjusted EBITDA ratio to 2.9x compared to 4.8x in the prior year.

Company Provides Fiscal Year 2024 Guidance

• Fiscal Year Total Revenue of $2.825 - $2.975 million
• Adjusted EBITDA of $310 - $340 million.

Adjusted EBITDA is a non-GAAP measure. Refer to the “Non-GAAP Financial Measures” section for more information. The Company is not providing a quantitative reconciliation of its financial outlook for Adjusted EBITDA to net income (loss), its corresponding GAAP measure, because the GAAP measure that is excluded from its non-GAAP financial outlook is difficult to reliably predict or estimate without unreasonable effort due to its dependence on future uncertainties, such as items discussed below. Additionally, information that is currently not available to the Company could have a potentially unpredictable and potentially significant impact on its future GAAP financial results.

BLUE BELL, Pa.--(BUSINESS WIRE)-- BrightView Holdings, Inc. (NYSE: BV) (the “Company” or “BrightView”), the leading commercial landscaping services company in the United States, today reported unaudited results for the fourth quarter and full fiscal year ended September 30, 2023.

(Graphic: Business Wire)

“BrightView finished a successful fiscal year 2023 with fourth quarter results reflecting growth in revenue, EBITDA and cash flow,” said BrightView President and Chief Executive Officer Dale Asplund. “During the quarter the team successfully executed on key initiatives including deleveraging the balance sheet and prioritizing profitable growth. I am proud to be leading this great company and am excited by the opportunities ahead of us as we work towards achieving our short- and long-term goals and creating value for all our employees, customers and stakeholders.”

Fiscal 2023 Results – Total BrightView

Total BrightView - Operating Highlights
		Three Months Ended September 30,										Year Ended September 30,
($ in millions, except per share figures)		2023			2022				Change			2023			2022				Change
Revenue		$	743.7			$	723.4			2.8%		$	2,816.0			$	2,774.6			1.5%
Net Income (Loss)		$	16.4			$	15.3			7.2%		$	(7.7	)		$	14.0			(155.0%)
Net Income (Loss) Margin			2.2	%			2.1	%		10 bps			(0.3	%)			0.5	%		(80) bps
Adjusted EBITDA		$	101.6			$	91.3			11.3%		$	298.7			$	287.9			3.8%
Adjusted EBITDA Margin			13.7	%			12.6	%		110 bps			10.6	%			10.4	%		20 bps
Adjusted Net Income		$	27.9			$	34.5			(19.1%)		$	61.4			$	100.9			(39.1%)
Basic Earnings (Loss) per Share		$	0.12			$	0.16			(25.0%)		$	(0.12	)		$	0.14			(185.7%)
Weighted average number of common shares outstanding – basic			93.4				93.0			0.4%			93.4				97.9			(4.6%)
Adjusted Earnings per Share		$	0.19			$	0.37			(48.6%)		$	0.42			$	1.03			(59.2%)
Adjusted weighted average number of common shares outstanding			146.7				93.0			57.7%			146.7				97.9			49.9%
Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Free Cash Flow, Adjusted Earnings per Share and Adjusted weighted average number of common shares outstanding are non-GAAP measures. Refer to the “Non-GAAP Financial Measures” and “Reconciliation of GAAP to Non-GAAP Financial Measures” sections for more information.

For the fourth quarter of fiscal 2023, total revenue increased 2.8% to a record $743.7 million, driven by $26.7 million in Development Services, or 3.7% of the total increase year-over-year, and $5.2 million revenue contribution from acquired businesses, or 0.7% of the total increase year-over-year. These increases were partially offset by a $12.9 million decrease in Maintenance organic revenue year-over-year.

For the fiscal year ended September 30, 2023, total revenue increased 1.5% to a record $2,816.0 million, driven by $61.1 million revenue contribution from acquired businesses, or 2.2% of the total percentage increase year over year, and $47.8 million in Development Services, or 1.7% of the total percentage increase year over year. These increases were partially offset by a $62.9 million decrease in organic snow removal services revenue year-over-year.

Fiscal 2023 Results – Segments

Maintenance Services - Operating Highlights
	Three Months Ended September 30,								Year Ended September 30,
($ in millions)	2023			2022			Change		2023			2022			Change
Landscape Maintenance	$	521.7		$	529.2		(1.4%)		$	1,857.5		$	1,825.7		1.7%
Snow Removal	$	(0.9	)	$	(0.7	)	(28.6%)		$	209.0		$	256.3		(18.5%)
Total Revenue	$	520.8		$	528.5		(1.5%)		$	2,066.5		$	2,082.0		(0.7%)
Adjusted EBITDA	$	81.7		$	81.4		0.4%		$	277.9		$	278.8		(0.3%)
Adjusted EBITDA Margin		15.7	%		15.4	%	30 bps			13.4	%		13.4	%	0 bps
Capital Expenditures	$	10.1		$	15.5		(34.8%)		$	56.1		$	82.9		(32.3%)

For the fourth quarter of fiscal 2023, revenue in the Maintenance Services Segment decreased by $7.7 million, or 1.5%, from the prior year. The decrease was driven by a decrease of $12.6 million in underlying commercial landscape services, partially offset by $5.2 million revenue contribution from acquired businesses.

Adjusted EBITDA for the Maintenance Services Segment for the three months ended September 30, 2023 increased by $0.3 million to $81.7 million from $81.4 million in the 2022 period. Segment Adjusted EBITDA Margin increased 30 basis points to 15.7%, in the three months ended September 30, 2023 from 15.4% in the 2022 period. The increases in Segment Adjusted EBITDA and Segment Adjusted EBITDA Margin were driven by decreases in materials and labor costs, inclusive of compensation-related costs.

For the fiscal year ended September 30, 2023, revenue in the Maintenance Services Segment decreased by $15.5 million, or 0.7%, from the 2022 period. The decrease was driven by a decrease of $47.3 million in snow removal services due to lower snowfall, net of $15.6 million from acquired businesses. Partially offsetting this was a $31.8 million increase in landscape services revenue consisting of a $34.1 million contribution from acquired businesses and a decrease of $2.3 million, or 0.1%, in underlying commercial landscape services.

Adjusted EBITDA for the Maintenance Services Segment for the fiscal year ended September 30, 2023 decreased by $0.9 million to $277.9 million from $278.8 million in the 2022 period. Segment Adjusted EBITDA Margin was 13.4% in each of the fiscal years ended September 30, 2023 and 2022. The relatively flat Segment Adjusted EBITDA had offsetting impacts from the decrease in Maintenance Services Segment revenues described above and disciplined management of labor and materials costs as well as lower fuel costs.

Development Services - Operating Highlights
	Three Months Ended September 30,								Year Ended September 30,
($ in millions)	2023			2022			Change		2023			2022			Change
Revenue	$	224.7		$	198.0		13.5%		$	758.0		$	698.8		8.5%
Adjusted EBITDA	$	29.1		$	25.5		14.1%		$	82.8		$	73.7		12.3%
Adjusted EBITDA Margin		13.0	%		12.9	%	10 bps			10.9	%		10.5	%	40 bps
Capital Expenditures	$	1.0		$	1.7		41.2%		$	8.2		$	12.5		(34.4%)

For the fourth quarter of fiscal 2023, revenue in the Development Services Segment increased by $26.7 million, or 13.5%, compared to the prior year. The increase was driven by an increase in Development Services project volumes of $26.7 million.

Adjusted EBITDA for the Development Services Segment for the three months ended September 30, 2023 increased $3.6 million to $29.1 million compared to the 2022 period and Adjusted EBITDA Margin increased 10 basis points to 13.0% for the quarter from 12.9% in the prior year. The increases in Segment Adjusted EBITDA and Segment Adjusted EBITDA Margin were primarily driven by the increase in revenues described above coupled with decreased compensation-related costs. These increases were partially offset by increased labor costs attributable to the mix of projects relative to the prior year.

For the fiscal year ended September 30, 2023, revenue in the Development Services Segment increased by $59.2 million, or 8.5%, compared to the 2022 period. The increase was principally driven by an increase of $47.8 million due to additional project volumes combined with an $11.4 million contribution from acquired businesses.

Adjusted EBITDA for the Development Services Segment fiscal year ended September 30, 2023 increased $9.1 million to $82.8 million compared to the 2022 period. Segment Adjusted EBITDA Margin increased 40 basis points to 10.9% for the period from 10.5% in the 2022 period. Segment Adjusted EBITDA and Segment Adjusted EBITDA Margin increased principally due to the increase in revenues described above coupled with lower materials costs as a percentage of revenue, partially offset by the mix of labor compared to the prior period.

Total BrightView Cash Flow Metrics
	Year Ended September 30,
($ in millions)	2023			2022			2021
Net Cash Provided by Operating Activities	$	129.9		$	106.9		$	148.4
Free Cash Flow	$	80.2		$	6.7		$	96.7
Capital Expenditures	$	71.3		$	107.3		$	61.2

Net cash provided by operating activities for the fiscal year ended September 30, 2023 increased $23.0 million to $129.9 million from $106.9 million in the prior year. This increase was due to a decrease in cash used by accounts payable and other operating liabilities and an increase in cash provided by other operating assets. This was partially offset by an increase in cash used by accounts receivable and an increase in net loss.

Free Cash Flow increased $73.5 million to $80.2 million for the fiscal year ended September 30, 2023 from $6.7 million in the prior year. The increase in free cash flows was driven by a decrease of $79.3 million in cash used for acquisitions, a decrease of $36.0 million in capital expenditures and an increase of $14.5 million in proceeds from the sale of property and equipment in comparison to the 2022 period.

For the fiscal year ended September 30, 2023, capital expenditures were $71.3 million compared with $107.3 million in the 2022 period. The Company also generated proceeds from the sale of property and equipment of $21.6 million and $7.1 million during the fiscal year ended September 30, 2023 and 2022, respectively. Net of the proceeds from the sale of property and equipment, net capital expenditures represented 1.8% and 3.6% of revenue in the fiscal year ended September 30, 2023 and 2022, respectively.

Total BrightView Balance Sheet Metrics
($ in millions)	September 30, 2023			June 30, 2023			September 30, 2022
Total Financial Debt1	$	937.5		$	1,404.3		$	1,395.0
Minus:
Total Cash & Equivalents		67.0			9.6			20.1
Total Net Financial Debt2	$	870.5		$	1,394.7		$	1,374.9
Total Net Financial Debt to Adjusted EBITDA ratio3	2.9x			4.8X			4.8x
1Total Financial Debt includes total long-term debt, net of original issue discount, and finance lease obligations
2Total Net Financial Debt equals Total Financial Debt minus Total Cash & Equivalents
3Total Net Financial Debt to Adjusted EBITDA ratio equals Total Net Financial Debt divided by the trailing twelve month Adjusted EBITDA.

As of September 30, 2023, the Company’s Total Net Financial Debt was $870.5 million, a decrease of $504.4 million compared to $1,374.9 million as of September 30, 2022. The Company’s Total Net Financial Debt to Adjusted EBITDA ratio was 2.9x, 4.8x and 4.8x as of September 30, 2023, June 30, 2023 and September 30, 2022, respectively. The year-over-year decreases in Total Net Financial Debt and Total Net Financial Debt to Adjusted EBITDA ratio were primarily driven by the August 28, 2023 $450.0 million voluntary repayment of our Series B Term Loan which was funded by $495.0 million of proceeds from the issuance of our Series A Convertible Preferred Stock, net of issuance costs.

Conference Call Information

A conference call to discuss the fourth quarter and full year fiscal 2023 financial results is scheduled for November 16, 2023, at 10 a.m. ET. The U.S. toll free dial-in for the conference call is (833) 470-1428 and the international dial-in is (929) 526-1599. The Conference ID is 725900. A live audio webcast of the conference call will be available on the Company’s investor website https://investor.brightview.com, where presentation materials will be posted prior to the call.

A replay of the call will be available until 11:59 p.m. ET on November 23, 2023. To access the recording, dial (929) 458-6194 (Conference ID 351953).

About BrightView

BrightView (NYSE: BV), the nation’s largest commercial landscaper, proudly designs, creates, and maintains some of the best landscapes on Earth and provides the most efficient and comprehensive snow and ice removal services. With a dependable service commitment, BrightView brings brilliant landscapes to life at premier properties across the United States, including business parks and corporate offices, homeowners' associations, healthcare facilities, educational institutions, retail centers, resorts and theme parks, municipalities, golf courses, and sports venues. BrightView also serves as the Official Field Consultant to Major League Baseball. Through industry-leading best practices and sustainable solutions, BrightView is invested in taking care of our team members, engaging our clients, inspiring our communities, and preserving our planet. Visit www.BrightView.com and connect with us on X (formerly known as Twitter), Facebook, and LinkedIn.

Forward Looking Statements

This press release contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this presentation, including statements relating to our fiscal 2024 guidance and other statements related to our goals, beliefs, business outlook, business trends, expectations regarding our industry, strategy, future events, future operations, future liquidity and financial position, future revenues, projected costs, prospects, plans and objectives of management, are forward-looking statements. Words such as “outlook,” “guidance,” “projects,” “continues,” “believes,” “expects,” “may,” “will,” “should,” “seeks,” “intends,” “plans,” “estimates,” or “anticipates,” or the negative variations of these words or similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. By their nature, forward-looking statements: speak only as of the date they are made; are not statements of historical fact or guarantees of future performance, and are based upon our current expectations, beliefs, estimates and projections, and various assumptions, many of which are subject to risks, uncertainties, assumptions, changes in circumstances or other factors outside of the Company’s control that are difficult to predict or quantify. Our expectations, beliefs, and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that management’s expectations, beliefs and projections will result or be achieved and actual results may vary materially from what is expressed in or indicated by the forward-looking statements. Factors that could cause actual results to differ materially from those projected include, but are not limited to: general business, economic and financial conditions; increases in raw material costs, fuel prices, wages and other operating costs; disruptions in our supply chain and changes in our ability to source adequate supplies and materials in a timely manner; competitive industry pressures; the failure to retain current customers, renew existing customer contracts and obtain new customer contracts; a determination by customers to reduce their outsourcing or use of preferred vendors; the dispersed nature of our operating structure; our ability to implement our business strategies and achieve our growth objectives; the possibility that the anticipated benefits from our business acquisitions will not be realized in full or at all or may take longer to realize than expected; the possibility that costs or difficulties related to the integration of acquired businesses’ operations will be greater than expected and the possibility that integration efforts will disrupt our business and strain management time and resources; the seasonal nature of our landscape maintenance services; our dependence on weather conditions and the impact of severe weather and climate change on our business; any failure to accurately estimate the overall risk, requirements, or costs when we bid on or negotiate contracts that are ultimately awarded to us; the conditions and periodic fluctuations of real estate markets, including residential and commercial construction; the level, timing and location of snowfall; our ability to retain or hire our executive management and other key personnel; our ability to attract and retain field and hourly employees, trained workers and third-party contractors and re-employ seasonal workers; any failure to properly verify employment eligibility of our employees; subcontractors taking actions that harm our business; our recognition of future impairment charges; laws and governmental regulations, including those relating to employees, wage and hour, immigration, human health and safety and transportation; environmental, health and safety laws and regulations, including regulatory costs, claims and litigation related to the use of chemicals and pesticides by employees and related third-party claims; the distraction and impact caused by litigation, of adverse litigation judgments and settlements resulting from legal proceedings; tax increases and changes in tax rules; increase in on-job accidents involving employees; any failure, inadequacy, interruption, security failure or breach of our information technology systems; our failure to comply with data privacy regulations; our ability to adequately protect our intellectual property; restrictions imposed by our debt agreements that limit our flexibility in operating our business; our substantial indebtedness; incurrence of substantially more debt by us or our subsidiaries; failure by the financial institutions that are part of the syndicate of our revolving credit facility to extend credit under the facility or reduce our borrowing base; increases in interest rates governing our variable rate indebtedness increasing the cost of servicing our substantial indebtedness; exposure to counterparty credit worthiness or non-performance with respect to the derivative financial instruments we utilize; restrictions contained in our debt agreements that limit our flexibility to operate our business; our ability to generate sufficient cash flow to satisfy our significant debt service obligations; any future sales, or the perception of future sales, by us or our affiliates, which could cause the market price for our common stock to decline; the ability of KKR BrightView Aggregator L.P., Birch-OR Equity Holdings, LLC and Birch Equity Holdings, LP to exert significant influence over us; the impact of holders of Series A Preferred Stock having certain voting and other rights that may adversely affect holders of our common stock; risks related to natural disasters, terrorist attacks, public health emergencies, including pandemics, heightened inflation, geopolitical conflicts, recession, financial market disruptions, other economic conditions, and other external events; our ability to pursue and achieve our environmental, social and corporate governance (ESG) focus area goals and targets and the possibility that complying with ESG standards and meeting our goals may be significantly more costly than anticipated; and costs and requirements imposed as a result of maintaining compliance with the requirements of being a public company.

Additional factors that could cause our results to differ materially from those described in the forward-looking statements can be found under “Item 1A. Risk Factors” in our Form 10-K for the fiscal year ended September 30, 2023, and such factors may be updated from time to time in our periodic filings with the Securities and Exchange Commission (the “SEC”), which are accessible on the SEC’s website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in our filings with the SEC. Any forward-looking statement made in this press release speaks only as of the date on which it was made. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

Non-GAAP Financial Measures

To supplement the Company’s financial information presented in accordance with GAAP and aid understanding of the Company’s business performance, the Company uses certain non-GAAP financial measures, namely “Adjusted EBITDA”, “Adjusted EBITDA Margin”, “Adjusted Net Income”, “Adjusted Earnings per Share”, “Adjusted weighted average number of common shares outstanding”, “Free Cash Flow”, “Total Financial Debt”, “Total Net Financial Debt” and “Total Net Financial Debt to Adjusted EBITDA ratio”. We believe Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Earnings per Share, Free Cash Flow, Total Financial Debt, Total Net Financial Debt, and Total Net Financial Debt to Adjusted EBITDA ratio assist investors in comparing our results across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. Management believes these non-GAAP financial measures are useful to investors in highlighting trends in our operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments. Management regularly uses these measures as tools in evaluating our operating performance, financial performance and liquidity. Management uses Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Earnings per Share, Free Cash Flow, Total Financial Debt, Total Net Financial Debt, and Total Net Financial Debt to Adjusted EBITDA ratio to supplement comparable GAAP measures in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, to establish discretionary annual incentive compensation and to compare our performance against that of other peer companies using similar measures. In addition, we believe that Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Earnings per Share, Free Cash Flow, Total Financial Debt, Total Net Financial Debt, and Total Net Financial Debt to Adjusted EBITDA ratio are frequently used by investors and other interested parties in the evaluation of issuers, many of which also present Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Earnings per Share, Free Cash Flow, Total Financial Debt, Total Net Financial Debt, and Total Net Financial Debt to Adjusted EBITDA ratio when reporting their results in an effort to facilitate an understanding of their operating and financial results and liquidity. Management supplements GAAP results with non-GAAP financial measures to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone.

Adjusted EBITDA: We define Adjusted EBITDA as net income (loss) before interest, taxes, depreciation and amortization, as further adjusted to exclude certain non-cash, non-recurring and other adjustment items.

Adjusted EBITDA Margin: We define Adjusted EBITDA Margin as Adjusted EBITDA, defined above, divided by Net Service Revenues.

Adjusted Net Income: We define Adjusted Net Income as net income (loss) including interest and depreciation, and excluding other items used to calculate Adjusted EBITDA and further adjusted for the tax effect of these exclusions and the removal of the discrete tax items.

Adjusted Earnings per Share: We define Adjusted Earnings per Share as Adjusted Net Income divided by the Adjusted Weighted Average Number of Common Shares Outstanding.

Adjusted Weighted Average Number of Common Shares Outstanding: We define Adjusted Weighted Average Number of Common Shares Outstanding as the weighted average number of common shares outstanding used in the calculation of basic earnings per share plus shares of common stock related to the Series A Preferred Stock on an as-converted basis, assumed to be converted for the entire period. The addition of shares of common stock related to the Series A Convertible Preferred Stock on an as-converted basis reflects the dilutive impact of the potential conversion of the Series A Preferred Stock and is expected to provide comparability in future periods.

Free Cash Flow: We define Free Cash Flow as cash flows from operating activities less capital expenditures, net of proceeds from the sale of property and equipment.

Total Financial Debt: We define Total Financial Debt as total long-term debt, net of original issue discount, and finance/capital lease obligations.

Total Net Financial Debt: We define Total Net Financial Debt as Total Financial Debt minus total cash and cash equivalents.

Total Net Financial Debt to Adjusted EBITDA ratio: We define Total Net Financial Debt to Adjusted EBITDA ratio as Total Net Financial Debt divided by the trailing twelve month Adjusted EBITDA.

Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Earnings per Share, Free Cash Flow, Total Financial Debt, Total Net Financial Debt, and Total Net Financial Debt to Adjusted EBITDA ratio are not recognized terms under GAAP and should not be considered as an alternative to net income (loss) or the ratio of net income (loss) to net revenue as a measure of financial performance, cash flows provided by operating activities as a measure of liquidity, or any other performance measure derived in accordance with GAAP. Additionally, these measures are not intended to be a measure of free cash flow available for management’s discretionary use as they do not consider certain cash requirements such as interest payments, tax payments and debt service requirements. The presentations of these measures have limitations as analytical tools and should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP. Because not all companies use identical calculations, the presentations of these measures may not be comparable to the same or other similarly titled measures of other companies and can differ significantly from company to company.

BrightView Holdings, Inc. Consolidated Balance Sheets (Unaudited)
(in millions)*		September 30, 2023				September 30, 2022
Assets
Current assets:
Cash and cash equivalents		$	67.0			$	20.1
Accounts receivable, net			442.3				397.6
Unbilled revenue			143.5				130.2
Other current assets			89.3				129.2
Total current assets			742.1				677.1
Property and equipment, net			315.2				328.3
Intangible assets, net			132.3				174.3
Goodwill			2,021.4				2,008.8
Operating lease assets			86.1				81.6
Other assets			55.1				35.4
Total assets		$	3,352.2			$	3,305.5
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable		$	136.2			$	151.2
Current portion of long-term debt			-				12.0
Deferred revenue			68.2				59.3
Current portion of self-insurance reserves			54.8				45.6
Accrued expenses and other current liabilities			180.2				193.5
Current portion of operating lease liabilities			27.3				26.8
Total current liabilities			466.7				488.4
Long-term debt, net			888.1				1,330.7
Deferred tax liabilities			51.1				68.6
Self-insurance reserves			105.1				101.1
Long-term operating lease liabilities			65.1				61.3
Other liabilities			34.6				38.6
Total liabilities			1,610.7				2,088.7
Mezzanine equity:
Series A convertible preferred shares, $0.01 par value, 7% cumulative dividends; 500,000 and no shares issued and outstanding as of September 30, 2023 and September 30, 2022, respectively, aggregate liquidation preference of $503.2 and $0 as of September 30, 2023 and September 30, 2022, respectively			498.2				—
Stockholders’ equity:
Preferred stock, $0.01 par value; 50,000,000 shares authorized; no shares issued or outstanding as of September 30, 2023 and September 30, 2022			—				—
Common stock, $0.01 par value; 500,000,000 shares authorized; 106,600,000 and 105,700,000 shares issued and 93,600,000 and 93,000,000 shares outstanding as of September 30, 2023 and September 30, 2022, respectively			1.1				1.1
Treasury stock, at cost; 13,000,000 and 12,700,000 shares as of September 30, 2023 and September 30, 2022, respectively			(170.4	)			(168.2	)
Additional paid-in capital			1,530.8				1,509.5
Accumulated deficit			(135.3	)			(127.6	)
Accumulated other comprehensive income			17.1				2.0
Total stockholders’ equity			1,243.3				1,216.8
Total liabilities, mezzanine equity and stockholders’ equity		$	3,352.2			$	3,305.5
(*) Amounts may not total due to rounding.

BrightView Holdings, Inc. Consolidated Statements of Operations (Unaudited)
		Three Months Ended September 30,								Fiscal Year Ended September 30,
(in millions)*		2023				2022				2023				2022
Net service revenues		$	743.7			$	723.4			$	2,816.0			$	2,774.6
Cost of services provided			558.1				534.8				2,137.1				2,099.8
Gross profit			185.6				188.6				678.9				674.8
Selling, general and administrative expense			120.5				135.4				533.4				534.9
Amortization expense			10.7				12.8				44.5				51.5
Income from operations			54.4				40.4				101.0				88.4
Other expense			8.7				0.4				6.7				15.5
Interest expense			19.2				18.8				97.4				53.3
Income (loss) before income taxes			26.5				21.2				(3.1	)			19.6
Income tax expense			10.1				5.9				4.6				5.6
Net income (loss)		$	16.4			$	15.3			$	(7.7	)		$	14.0
Less: dividends on Series A convertible preferred shares			3.2				—				3.2				—
Net income (loss) attributable to common stockholders		$	13.2			$	15.3			$	(10.9	)		$	14.0
Earnings (loss) per share
Basic and diluted earnings (loss) per share		$	0.12			$	0.16			$	(0.12	)		$	0.14

BrightView Holdings, Inc. Segment Reporting (Unaudited)
		Three Months Ended September 30,								Fiscal Year Ended September 30,
(in millions)*		2023				2022				2023				2022
Maintenance Services		$	520.8			$	528.5			$	2,066.5			$	2,082.0
Development Services			224.7				198.0				758.0				698.8
Eliminations			(1.8	)			(3.1	)			(8.5	)			(6.2	)
Net Service Revenues		$	743.7			$	723.4			$	2,816.0			$	2,774.6
Maintenance Services		$	81.7			$	81.4			$	277.9			$	278.8
Development Services			29.1				25.5				82.8				73.7
Corporate			(9.2	)			(15.6	)			(62.0	)			(64.6	)
Adjusted EBITDA		$	101.6			$	91.3			$	298.7			$	287.9
Maintenance Services		$	10.1			$	15.5			$	56.1			$	82.9
Development Services			1.0				1.7				8.2				12.5
Corporate			2.4				2.0				7.0				11.9
Capital Expenditures		$	13.5			$	19.2			$	71.3			$	107.3
(*) Amounts may not total due to rounding.

BrightView Holdings, Inc. Consolidated Statements of Cash Flows (Unaudited)
		Fiscal Year Ended September 30,
(in millions)*		2023				2022
Cash flows from operating activities:
Net (loss) income		$	(7.7	)		$	14.0
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			105.2				98.9
Amortization of intangible assets			44.5				51.5
Amortization of financing costs and original issue discount			3.5				3.7
Loss on debt extinguishment			8.3				12.6
Deferred taxes			(21.5	)			(6.6	)
Equity-based compensation			22.1				18.9
Realized gain on hedges			(15.2	)			(1.0	)
Other non-cash activities, net			(5.3	)			(1.7	)
Change in operating assets and liabilities:
Accounts receivable			(52.6	)			(6.3	)
Unbilled and deferred revenue			(5.4	)			(6.9	)
Other operating assets			17.1				(10.5	)
Accounts payable and other operating liabilities			36.9				(59.7	)
Net cash provided by operating activities			129.9				106.9
Cash flows from investing activities:
Purchase of property and equipment			(71.3	)			(107.3	)
Proceeds from sale of property and equipment			21.6				7.1
Business acquisitions, net of cash acquired			(13.8	)			(93.1	)
Other investing activities, net			2.1				(0.4	)
Net cash (used) by investing activities			(61.4	)			(193.7	)
Cash flows from financing activities:
Repayments of finance lease obligations			(27.6	)			(27.0	)
Repayments of term loan			(459.0	)			(1,006.3	)
Repayments of receivables financing agreement			(554.5	)			(374.4	)
Repayments of revolving credit facility			(33.5	)			(165.0	)
Proceeds from term loan, net of issuance costs			—				1,180.1
Proceeds from receivables financing agreement, net of issuance costs			549.5				391.7
Proceeds from revolving credit facility			33.5				165.0
Debt issuance and prepayment costs			(1.8	)			(4.6	)
Proceeds from issuance of Series A preferred stock, net of issuance costs			495.0				—
Proceeds from issuance of common stock, net of share issuance costs			1.2				1.6
Repurchase of common stock and distributions			(2.2	)			(163.8	)
Contingent business acquisition payments			(22.1	)			—
Other financing activities, net			(0.1	)			(14.1	)
Net cash (used) by financing activities			(21.6	)			(16.8	)
Net change in cash and cash equivalents			46.9				(103.6	)
Cash and cash equivalents, beginning of period			20.1				123.7
Cash and cash equivalents, end of period		$	67.0			$	20.1
Supplemental Cash Flow Information:
Cash (received) paid for income taxes, net		$	(9.8	)		$	17.3
Cash paid for interest, net		$	82.1			$	48.7
(*) Amounts may not total due to rounding.

BrightView Holdings, Inc. Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)
		Three Months Ended September 30,								Fiscal Year Ended September 30,
(in millions)*		2023				2022				2023				2022
Adjusted EBITDA
Net (loss) income		$	16.4			$	15.3			$	(7.7	)		$	14.0
Plus:
Interest expense, net			19.2				18.8				97.4				53.3
Income tax expense (benefit)			10.1				5.9				4.6				5.6
Depreciation expense			24.3				27.3				105.2				98.9
Amortization expense			10.7				12.8				44.5				51.5
Business transformation and integration costs (a)			6.2				8.9				23.7				21.5
Offering-related expenses (b)			—				—				—				0.1
Equity-based compensation (c)			6.4				4.8				22.3				19.0
COVID-19 related expenses (d)			—				(2.5	)			0.4				11.4
Debt extinguishment (e)			8.3				—				8.3				12.6
Adjusted EBITDA		$	101.6			$	91.3			$	298.7			$	287.9
Adjusted Net Income
Net (loss) income		$	16.4			$	15.3			$	(7.7	)		$	14.0
Plus:
Amortization expense			10.7				12.8				44.5				51.5
Business transformation and integration costs (a)			6.2				8.9				23.7				21.5
Offering-related expenses (b)			—				—				—				0.1
Equity-based compensation (c)			6.4				4.8				22.3				19.0
COVID-19 related expenses (d)			—				(2.5	)			0.4				11.4
Debt extinguishment (e)			8.3				—				8.3				12.6
Income tax adjustment (f)			(20.1	)			(4.8	)			(30.1	)			(29.2	)
Adjusted Net Income		$	27.9			$	34.5			$	61.4			$	100.9
Free Cash Flow
Cash flows from operating activities		$	40.6			$	41.2			$	129.9			$	106.9
Minus:
Capital expenditures			13.4				19.2				71.3				107.3
Plus:
Proceeds from sale of property and equipment			14.8				1.6				21.6				7.1
Free Cash Flow		$	42.0			$	23.6			$	80.2			$	6.7
Adjusted Earnings per Share
Numerator:
Adjusted Net Income		$	27.9			$	34.5			$	61.4			$	100.9
Denominator:
Weighted average number of common shares outstanding – basic			93,420,000				93,029,789				93,412,000				97,898,000
Plus:
Dilutive impact of Series A convertible preferred stock as-converted			53,301,000				—				53,301,000				—
Adjusted weighted average number of common shares outstanding			146,721,000				93,029,789				146,713,000				97,898,000
Adjusted Earnings per Share		$	0.19			$	0.37			$	0.42			$	1.03
(*) Amounts may not total due to rounding.

BrightView Holdings, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited)

(a)	Business transformation and integration costs consist of (i) severance and related costs; (ii) business integration costs and (iii) information technology infrastructure, transformation and other costs.

		Three Months Ended September 30,								Fiscal Year Ended September 30,
(in millions)*		2023				2022				2023				2022
Severance and related costs (g)		$	2.9			$	0.7			$	8.9			$	1.6
Business integration (h)			0.9				3.5				6.2				8.2
IT infrastructure, transformation, and other (i)			2.4				4.7				8.6				11.7
Business transformation and integration costs		$	6.2			$	8.9			$	23.7			$	21.5

(b)	Represents transaction related expenses incurred for completed or contemplated subsequent registration statements.
(c)	Represents equity-based compensation expense and related taxes recognized for equity incentive plans outstanding.
(d)	Represents expenses related to the Company’s response to the COVID-19 pandemic, principally temporary and incremental salary and related expenses, personal protective equipment, cleaning and supply purchases, and other.  Additionally, fiscal year 2022 includes refunds related to employee retention credits allowed under the CARES Act.
(e)	Represents losses on the extinguishment of debt related to Amendments No. 7 and No. 6 to the Credit Agreement, in the fiscal years ended September 30, 2023 and 2022, respectively, and includes accelerated amortization of deferred financing fees and original issue discount as well as fees paid to lenders and third parties.
(f)	Represents the tax effect of pre-tax items excluded from Adjusted Net Income and the removal of the applicable discrete tax items, which collectively result in an increase or decrease in income tax. The tax effect of pre-tax items excluded from Adjusted Net Income is computed using the statutory rate related to the jurisdiction that was impacted by the adjustment after taking into account the impact of permanent differences and valuation allowances. Discrete tax items include changes in laws or rates, changes in uncertain tax positions relating to prior years and changes in valuation allowances.

		Three Months Ended September 30,								Fiscal Year Ended September 30,
(in millions)*		2023				2022				2023				2022
Tax impact of pre-tax income adjustments		$	23.4			$	4.8			$	34.1			$	29.4
Discrete tax items			(3.3	)			—				(4.0	)			(0.2	)
Income tax adjustment		$	20.1			$	4.8			$	30.1			$	29.2

(g)	Represents severance and related costs including expenses incurred in connection with the Company’s CEO transition.
(h)	Represents isolated expenses specifically related to the integration of acquired companies such as one-time employee retention costs, employee onboarding and training costs, and fleet and uniform rebranding costs. The Company excludes Business integration costs from the measures disclosed above since such expenses vary in amount due to the number of acquisitions and size of acquired companies as well as factors specific to each acquisition, and as a result lack predictability as to occurrence and/or timing, and create a lack of comparability between periods.
(i)	Represents expenses related to distinct initiatives, typically significant enterprise-wide changes. Such expenses are excluded from the measures disclosed above since such expenses vary in amount based on occurrence as well as factors specific to each of the activities, are outside of the normal operations of the business, and create a lack of comparability between periods.

BrightView Holdings, Inc. Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)
Total Financial Debt and Total Net Financial Debt
(in millions)*		September 30, 2023				June 30, 2023				September 30, 2022
Long-term debt, net		$	888.1			$	1,336.2			$	1,330.7
Plus:
Current portion of long-term debt			—				12.0				12.0
Financing costs, net			6.6				9.4				10.6
Present value of net minimum payment - finance lease obligations (j)			42.8				46.7				41.7
Total Financial Debt			937.5				1,404.3				1,395.0
Less: Cash and cash equivalents			(67.0	)			(9.6	)			(20.1	)
Total Net Financial Debt		$	870.5			$	1,394.7			$	1,374.9
Total Net Financial Debt to Adjusted EBITDA ratio		2.9x				4.8X				4.8x

(j)	Balance is presented within Accrued expenses and other current liabilities and Other liabilities in the Consolidated Balance Sheet.
(*)	Amounts may not total due to rounding.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20231116233003/en/

Investor Relations

IR@BrightView.com

News Media

David Freireich, Vice President of Communications & Public Affairs

(484) 567-7244

David.Freireich@BrightView.com

Source: BrightView Landscapes

FAQ

What is BrightView Holdings, Inc.'s stock ticker symbol?

BrightView Holdings, Inc.'s stock ticker symbol is BV.

What was the percentage increase in total revenue in the fourth quarter?

Total revenue increased by 2.8% year-over-year to a fourth quarter record $743.7 million.

What is the fiscal year 2024 guidance for BrightView Holdings, Inc.?

The company expects total revenue of $2.825 - $2.975 million and adjusted EBITDA of $310 - $340 million for fiscal year 2024.

What were the key initiatives executed by BrightView Holdings, Inc. in fiscal year 2023?

The company successfully executed key initiatives including deleveraging the balance sheet and prioritizing profitable growth.

What was the change in the total net financial debt to adjusted EBITDA ratio from September 30, 2022, to September 30, 2023?

The total net financial debt to adjusted EBITDA ratio decreased from 4.8x to 2.9x year-over-year.