ROLLINS, INC. REPORTS THIRD QUARTER 2025 FINANCIAL RESULTS

Double-Digit Revenue Growth Drives 20%+ EPS Growth and 30%+ Cash Flow Growth

ATLANTA, Oct. 29, 2025 /PRNewswire/ -- Rollins, Inc. (NYSE: ROL) ("Rollins" or the "Company"), a premier global consumer and commercial services company, reported unaudited financial results for the third quarter of 2025.

Key Highlights

*Amounts are non-GAAP financial measures. See the schedules below for a discussion of non-GAAP financial metrics including a reconciliation to the most directly comparable GAAP measure.

Management Commentary

"We delivered a strong third quarter with record revenue and an improving margin profile, a reflection of an ongoing commitment to execution by our teammates," said Jerry Gahlhoff, Jr., President and CEO. "As we look to close out 2025, we remain well-positioned for continued growth, both organically and through acquisitions, and are focused on continuous improvement initiatives to enhance profitability throughout our business," Mr. Gahlhoff added.

"Double-digit revenue growth drove exceptional earnings and cash flow results in the quarter," said Kenneth Krause, Executive Vice President and CFO. "Adjusted EBITDA margins improved 120 basis points, associated with leverage across the income statement. Additionally, we continue to execute a balanced capital allocation program enabled by compounding cash flow, a strong balance sheet, and access to investment grade credit markets," Mr. Krause concluded.

Three and Nine Months Ended Financial Highlights

Three Months Ended September 30,

Nine Months Ended September 30,

Variance

(unaudited, in thousands, except per

share data and margins)

2025

2024

2025

2024

GAAP Metrics

Revenues

$ 1,026,106

$ 916,270

$ 109,836

12.0 %

$ 2,848,137

$ 2,556,539

$ 291,598

11.4 %

Gross profit (1)

$ 558,656

$ 494,378

$ 64,278

13.0 %

$ 1,518,692

$ 1,358,804

$ 159,888

11.8 %

Gross profit margin (1)

54.4 %

54.0 %

40 bps

53.3 %

53.2 %

10 bps

Operating income

$ 225,021

$ 191,796

$ 33,225

17.3 %

$ 566,002

$ 506,597

$ 59,405

11.7 %

Operating margin

21.9 %

20.9 %

100 bps

19.9 %

19.8 %

10 bps

Net income

$ 163,527

$ 136,913

$ 26,614

19.4 %

$ 410,264

$ 360,704

$ 49,560

13.7 %

EPS

$ 0.34

$ 0.28

$ 0.06

21.4 %

$ 0.85

$ 0.74

$ 0.11

14.9 %

Net cash provided by operating activities

$ 191,349

$ 146,947

$ 44,402

30.2 %

$ 513,363

$ 419,495

$ 93,868

22.4 %

Non-GAAP Metrics

Adjusted operating income (2)

$ 232,057

$ 196,012

$ 36,045

18.4 %

$ 584,826

$ 520,286

$ 64,540

12.4 %

Adjusted operating margin (2)

22.6 %

21.4 %

120 bps

20.5 %

20.4 %

10 bps

Adjusted net income (2)

$ 168,501

$ 139,617

$ 28,884

20.7 %

$ 423,277

$ 370,194

$ 53,083

14.3 %

Adjusted EPS (2)

$ 0.35

$ 0.29

$ 0.06

20.7 %

$ 0.87

$ 0.76

$ 0.11

14.5 %

Adjusted EBITDA (2)

$ 258,334

$ 219,460

$ 38,874

17.7 %

$ 661,343

$ 590,331

$ 71,012

12.0 %

Adjusted EBITDA margin (2)

25.2 %

24.0 %

120 bps

23.2 %

23.1 %

10 bps

Free cash flow (2)

$ 182,846

$ 139,425

$ 43,421

31.1 %

$ 491,003

$ 396,106

$ 94,897

24.0 %

(1) Exclusive of depreciation and amortization

(2) Amounts are non-GAAP financial measures. See the appendix to this release for a discussion of non-GAAP financial metrics including a reconciliation to the most directly comparable GAAP measure.

The following table presents financial information, including our significant expense categories, for the three and nine months ended September 30, 2025 and 2024:

Three Months Ended September 30,

Nine Months Ended September 30,

(unaudited, in thousands)

2025

2024

2025

2024

% of Revenue

Revenue

$ 1,026,106

100.0 %

$ 916,270

100.0 %

$ 2,848,137

100.0 %

$ 2,556,539

100.0 %

Less:

Cost of services provided (exclusive of

depreciation and amortization below):

Employee expenses

312,249

30.4 %

278,296

30.4 %

872,326

30.6 %

784,868

30.7 %

Materials and supplies

62,933

6.1 %

56,675

6.2 %

170,924

6.0 %

158,502

6.2 %

Insurance and claims

11,127

1.1 %

16,649

1.8 %

48,385

1.7 %

49,327

1.9 %

Fleet expenses

38,997

3.8 %

33,650

3.7 %

117,688

4.1 %

99,000

3.9 %

Other cost of services provided (1)

42,144

4.1 %

36,622

4.0 %

120,122

4.2 %

106,038

4.1 %

Total cost of services provided (exclusive of

depreciation and amortization below)

467,450

45.6 %

421,892

46.0 %

1,329,445

46.7 %

1,197,735

46.8 %

Sales, general and administrative:

Selling and marketing expenses

138,881

13.5 %

124,388

13.6 %

377,309

13.2 %

332,749

13.0 %

Administrative employee expenses

88,601

8.6 %

79,507

8.7 %

259,384

9.1 %

234,701

9.2 %

Insurance and claims

6,929

0.7 %

10,045

1.1 %

29,872

1.0 %

29,659

1.2 %

Fleet expenses

9,502

0.9 %

8,297

0.9 %

29,348

1.0 %

25,257

1.0 %

Other sales, general and administrative (2)

57,491

5.6 %

52,681

5.7 %

163,600

5.7 %

147,156

5.8 %

Total sales, general and administrative

301,404

29.4 %

274,918

30.0 %

859,513

30.2 %

769,522

30.1 %

Depreciation and amortization

32,231

3.1 %

27,664

3.0 %

93,177

3.3 %

82,685

3.2 %

Interest expense, net

7,942

0.8 %

7,150

0.8 %

21,118

0.7 %

22,650

0.9 %

Other (income) expense, net

(350)

— %

(582)

(0.1) %

(1,334)

— %

(933)

— %

Income tax expense

53,902

5.3 %

48,315

5.3 %

135,954

4.8 %

124,176

4.9 %

Net income

$ 163,527

15.9 %

$ 136,913

14.9 %

$ 410,264

14.4 %

$ 360,704

14.1 %

1) Other cost of services provided includes facilities costs, professional services, maintenance & repairs, software license costs, and other expenses directly related to providing services.

2) Other sales, general and administrative includes facilities costs, professional services, maintenance & repairs, software license costs, bad debt expense, and other administrative expenses.

About Rollins, Inc.:

Rollins, Inc. (ROL) is a premier global consumer and commercial services company. Through its family of leading brands, the Company and its franchises provide essential pest control services and protection against termite damage, rodents, and insects to more than 2.8 million customers in North America, South America, Europe, Asia, Africa, and Australia, with more than 20,000 employees from more than 800 locations. Rollins is parent to Aardwolf Pestkare, Clark Pest Control, Crane Pest Control, Critter Control, Fox Pest Control, HomeTeam Pest Defense, Industrial Fumigant Company, McCall Service, MissQuito, Northwest Exterminating, OPC Pest Services, Orkin, Orkin Australia, Orkin Canada, PermaTreat, Safeguard, Saela Pest Control, Trutech, Waltham Services, Western Pest Services, and more. You can learn more about Rollins and its subsidiaries by visiting www.rollins.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release as well as other written or oral statements by the Company may contain "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our current opinions, expectations, intentions, beliefs, plans, objectives, assumptions and projections about future events and financial trends affecting the operating results and financial condition of our business. Although we believe that these forward-looking statements are reasonable, we cannot assure you that we will achieve or realize these plans, intentions, or expectations. Generally, statements that do not relate to historical facts, including statements concerning possible or assumed future actions, business strategies, events or results of operations, are forward-looking statements. The words "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "possible," "potential," "predict," "should," "will," "would," and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this press release include, but are not limited to, statements regarding: expectations with respect to our financial and business performance; an ongoing commitment to execution by our teammates; remaining well-positioned for continued growth, both organically and through acquisitions; focused on continuous improvement initiatives to enhance profitability throughout our business; and a balanced capital allocation program enabled by compounding cash flow, a strong balance sheet, and access to investment grade credit markets.

These forward-looking statements are based on information available as of the date of this press release, and current expectations, forecasts, and assumptions, and involve a number of judgments, risks and uncertainties. Important factors could cause actual results to differ materially from those indicated or implied by forward-looking statements including, but not limited to, those set forth in the sections entitled "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and may also be described from time to time in our future reports filed with the SEC.

Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required by law.

Conference Call

Rollins will host a conference call on Thursday, October 30, 2025 at 8:30 a.m. Eastern Time to discuss the third quarter 2025 results. The conference call will also broadcast live over the internet via a link provided on the Rollins, Inc. website at www.rollins.com. Interested parties can also dial into the call at 1-877-869-3839 (domestic) or +1-201-689-8265 (internationally) with conference ID of 13755878. For interested individuals unable to join the call, a replay will be available on the website for 180 days.

ROLLINS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(in thousands)

(unaudited)

September 30,

2025

December 31,

2024

ASSETS

Cash and cash equivalents

$ 127,357

$ 89,630

Trade receivables, net

236,570

196,081

Financed receivables, short-term, net

46,202

40,301

Materials and supplies

43,482

39,531

Other current assets

97,099

77,080

Total current assets

550,710

442,623

Equipment and property, net

128,662

124,839

Goodwill

1,358,242

1,161,085

Intangibles, net

598,191

541,589

Operating lease right-of-use assets

423,069

414,474

Financed receivables, long-term, net

104,902

89,932

Other assets

55,884

45,153

Total assets

$ 3,219,660

$ 2,819,695

LIABILITIES

Short-term debt

$ —

Accounts payable

54,956

49,625

Accrued insurance – current

40,412

54,840

Accrued compensation and related liabilities

126,892

122,869

Unearned revenues

200,215

180,851

Operating lease liabilities – current

134,242

121,319

Other current liabilities

156,127

115,658

Total current liabilities

712,844

645,162

Accrued insurance, less current portion

77,552

61,946

Operating lease liabilities, less current portion

292,181

295,899

Long-term debt

485,659

395,310

Other long-term accrued liabilities

119,376

90,785

Total liabilities

1,687,612

1,489,102

STOCKHOLDERS' EQUITY

Common stock

484,628

484,372

Retained earnings and other equity

1,047,420

846,221

Total stockholders' equity

1,532,048

1,330,593

Total liabilities and stockholders' equity

$ 3,219,660

$ 2,819,695

ROLLINS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands except per share data)

(unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2025

2024

2025

2024

REVENUES

Customer services

$ 1,026,106

$ 916,270

$ 2,848,137

$ 2,556,539

COSTS AND EXPENSES

Cost of services provided (exclusive of depreciation and amortization below)

467,450

421,892

1,329,445

1,197,735

Sales, general and administrative

301,404

274,918

859,513

769,522

Depreciation and amortization

32,231

27,664

93,177

82,685

Total operating expenses

801,085

724,474

2,282,135

2,049,942

OPERATING INCOME

225,021

191,796

566,002

506,597

Interest expense, net

7,942

7,150

21,118

22,650

Other (income) expense, net

(350)

(582)

(1,334)

(933)

CONSOLIDATED INCOME BEFORE INCOME TAXES

217,429

185,228

546,218

484,880

PROVISION FOR INCOME TAXES

53,902

48,315

135,954

124,176

NET INCOME

$ 163,527

$ 136,913

$ 410,264

$ 360,704

NET INCOME PER SHARE - BASIC AND DILUTED

$ 0.34

$ 0.28

$ 0.85

$ 0.74

Weighted average shares outstanding - basic

484,635

484,317

484,565

484,231

Weighted average shares outstanding - diluted

484,670

484,359

484,598

484,270

DIVIDENDS PAID PER SHARE

$ 0.165

$ 0.150

$ 0.495

$ 0.450

ROLLINS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED CASH FLOW INFORMATION

(in thousands)

(unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2025

2024

2025

2024

OPERATING ACTIVITIES

Net income

$ 163,527

$ 136,913

$ 410,264

$ 360,704

Depreciation and amortization

32,231

27,664

93,177

82,685

Change in working capital and other operating activities

(4,409)

(17,630)

9,922

(23,894)

Net cash provided by operating activities

191,349

146,947

513,363

419,495

INVESTING ACTIVITIES

Acquisitions, net of cash acquired

(34,730)

(23,875)

(288,308)

(105,529)

Capital expenditures

(8,503)

(7,522)

(22,360)

(23,389)

Other investing activities, net

3,509

1,458

7,853

5,358

Net cash used in investing activities

(39,724)

(29,939)

(302,815)

(123,560)

FINANCING ACTIVITIES

Net borrowings (repayments)

(59,989)

(57,000)

95,215

(46,000)

Payment of dividends

(80,077)

(72,797)

(239,450)

(217,964)

Other financing activities, net

(6,509)

(1,823)

(30,910)

(41,542)

Net cash used in financing activities

(146,575)

(131,620)

(175,145)

(305,506)

Effect of exchange rate changes on cash and cash equivalents

(728)

3,197

2,324

1,028

Net (decrease) increase in cash and cash equivalents

$ 4,322

$ (11,415)

$ 37,727

$ (8,543)

APPENDIX

Reconciliation of GAAP and non-GAAP Financial Measures

A non-GAAP financial measure is a numerical measure of financial performance, financial position, or cash flows that either 1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of income, statement of financial position or statement of cash flows, or 2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented.

These measures should not be considered in isolation or as a substitute for revenues, net income, earnings per share or other performance measures prepared in accordance with GAAP. Management believes all of these non-GAAP financial measures are useful to provide investors with information about current trends in, and period-over-period comparisons of, the Company's results of operations. An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP.

The Company has used the following non-GAAP financial measures in this earnings release:

Organic revenues

Organic revenues are calculated as revenues less the revenues from acquisitions completed within the prior 12 months and excluding the revenues from divested businesses. Acquisition revenues are based on the trailing 12-month revenue of our acquired entities. Management uses organic revenues, and organic revenues by type to compare revenues over various periods excluding the impact of acquisitions and divestitures.

Adjusted operating income and adjusted operating margin

Adjusted operating income and adjusted operating margin are calculated by adding back to net income those expenses resulting from the amortization of intangible assets and adjustments to the fair value of contingent consideration resulting from the acquisitions of Fox Pest Control and Saela Pest Control. Adjusted operating margin is calculated as adjusted operating income divided by revenues. Management uses adjusted operating income and adjusted operating margin as measures of operating performance because these measures allow the Company to compare performance consistently over various periods.

Adjusted net income and adjusted EPS

Adjusted net income and adjusted EPS are calculated by adding back to the GAAP measures amortization of intangible assets and adjustments to the fair value of contingent consideration resulting from the acquisitions of Fox Pest Control and Saela Pest Control, excluding gains and losses on the sale of non-operational assets and gains on the sale of businesses, and by further subtracting the tax impact of those expenses, gains, or losses. Management uses adjusted net income and adjusted EPS as measures of operating performance because these measures allow the Company to compare performance consistently over various periods.

EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, incremental EBITDA margin and adjusted incremental EBITDA margin

EBITDA is calculated by adding back to net income depreciation and amortization, interest expense, net, and provision for income taxes. EBITDA margin is calculated as EBITDA divided by revenues. Adjusted EBITDA and adjusted EBITDA margin are calculated by further adding back those expenses resulting from the adjustments to the fair value of contingent consideration resulting from the acquisitions of Fox Pest Control and Saela Pest Control, and excluding gains and losses on the sale of non-operational assets and gains on the sale of businesses. Management uses EBITDA, EBITDA margin, adjusted EBITDA and adjusted EBITDA margin as measures of operating performance because these measures allow the Company to compare performance consistently over various periods. Incremental EBITDA margin is calculated as the change in EBITDA divided by the change in revenue. Management uses incremental EBITDA margin as a measure of operating performance because this measure allows the Company to compare performance consistently over various periods. Adjusted incremental EBITDA margin is calculated as the change in adjusted EBITDA divided by the change in revenue. Management uses adjusted incremental EBITDA margin as a measure of operating performance because this measure allows the Company to compare performance consistently over various periods.

Free cash flow and free cash flow conversion

Free cash flow is calculated by subtracting capital expenditures from cash provided by operating activities. Management uses free cash flow to demonstrate the Company's ability to maintain its asset base and generate future cash flows from operations. Free cash flow conversion is calculated as free cash flow divided by net income. Management uses free cash flow conversion to demonstrate how much net income is converted into cash. Management believes that free cash flow is an important financial measure for use in evaluating the Company's liquidity. Free cash flow should be considered in addition to, rather than as a substitute for, net cash provided by operating activities as a measure of our liquidity. Additionally, the Company's definition of free cash flow is limited, in that it does not represent residual cash flows available for discretionary expenditures, due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations or payments made for business acquisitions. Therefore, management believes it is important to view free cash flow as a measure that provides supplemental information to our consolidated statements of cash flows.

Adjusted sales, general, and administrative ("SG&A")

Adjusted SG&A is calculated by removing the adjustments to the fair value of contingent consideration resulting from the acquisitions of Fox Pest Control and Saela Pest Control. Management uses adjusted SG&A to compare SG&A expenses consistently over various periods.

Leverage ratio

Leverage ratio, a financial valuation measure, is calculated by dividing adjusted net debt by adjusted EBITDAR. Adjusted net debt is calculated by adding short-term debt and operating lease liabilities to total long-term debt less a cash adjustment of 90% of total consolidated cash. Adjusted EBITDAR is calculated by adding back to net income depreciation and amortization, interest expense, net, provision for income taxes, operating lease cost, and stock-based compensation expense. Management uses leverage ratio as an assessment of overall liquidity, financial flexibility, and leverage.

Set forth below is a reconciliation of the non-GAAP financial measures contained in this release to their most directly comparable GAAP measures.

(unaudited, in thousands, except per share data and margins)

Three Months Ended September 30,

Nine Months Ended September 30,

Variance

2025

2024

2025

2024

Reconciliation of Revenues to Organic Revenues

Revenues

$ 1,026,106

$ 916,270

109,836

12.0

$ 2,848,137

$ 2,556,539

291,598

11.4

Revenues from acquisitions

(43,986)

—

(43,986)

4.8

(105,138)

—

(105,138)

4.1

Organic revenues

$ 982,120

$ 916,270

65,850

7.2

$ 2,742,999

$ 2,556,539

186,460

7.3

Reconciliation of Residential Revenues to Organic Residential Revenues

Residential revenues

$ 476,271

$ 428,290

47,981

11.2

$ 1,288,249

$ 1,166,042

122,207

10.5

Residential revenues from acquisitions

(25,620)

—

(25,620)

6.0

(61,194)

—

(61,194)

5.3

Residential organic revenues

$ 450,651

$ 428,290

22,361

5.2

$ 1,227,055

$ 1,166,042

61,013

5.2

Reconciliation of Commercial Revenues to Organic Commercial Revenues

Commercial revenues

$ 334,956

$ 299,633

35,323

11.8

$ 939,803

$ 845,517

94,286

11.2

Commercial revenues from acquisitions

(10,523)

—

(10,523)

3.5

(26,244)

—

(26,244)

3.2

Commercial organic revenues

$ 324,433

$ 299,633

24,800

8.3

$ 913,559

$ 845,517

68,042

8.0

Reconciliation of Termite and Ancillary Revenues to Organic Termite and Ancillary Revenues

Termite and ancillary revenues

$ 204,670

$ 177,674

26,996

15.2

$ 588,655

$ 515,758

72,897

14.1

Termite and ancillary revenues from acquisitions

(7,843)

—

(7,843)

4.4

(17,700)

—

(17,700)

3.4

Termite and ancillary organic revenues

$ 196,827

$ 177,674

19,153

10.8

$ 570,955

$ 515,758

55,197

10.7

Reconciliation of Franchise and Other Revenues to Organic Franchise and Other Revenues

Franchise and other revenues

$ 10,209

$ 10,673

(464)

(4.3)

$ 31,430

$ 29,222

2,208

7.6

Franchise and other revenues from acquisitions

—

Franchise and other organic revenues

$ 10,209

$ 10,673

(464)

(4.3)

$ 31,430

$ 29,222

2,208

7.6

Three Months Ended September 30,

Nine Months Ended September 30,

Variance

2025

2024

2025

2024

Reconciliation of Operating Income and Operating Income Margin to Adjusted Operating Income and Adjusted Operating Margin

Operating income

$ 225,021

$ 191,796

$ 566,002

$ 506,597

Acquisition-related expenses (1)

7,036

4,216

18,824

13,689

Adjusted operating income

$ 232,057

$ 196,012

36,045

18.4

$ 584,826

$ 520,286

64,540

12.4

Revenues

$ 1,026,106

$ 916,270

$ 2,848,137

$ 2,556,539

Operating margin

21.9 %

20.9 %

19.9 %

19.8 %

Adjusted operating margin

22.6 %

21.4 %

20.5 %

20.4 %

Reconciliation of Net Income and EPS to Adjusted Net Income and Adjusted EPS

Net income

$ 163,527

$ 136,913

$ 410,264

$ 360,704

Acquisition-related expenses (1)

7,036

4,216

18,824

13,689

Gain on sale of assets, net (2)

(350)

(582)

(1,334)

(933)

Tax impact of adjustments (3)

(1,712)

(930)

(4,477)

(3,266)

Adjusted net income

$ 168,501

$ 139,617

28,884

20.7

$ 423,277

$ 370,194

53,083

14.3

EPS - basic and diluted

$ 0.34

$ 0.28

$ 0.85

$ 0.74

Acquisition-related expenses (1)

0.01

0.04

0.03

Gain on sale of assets, net (2)

—

Tax impact of adjustments (3)

—

(0.01)

Adjusted EPS - basic and diluted (4)

$ 0.35

$ 0.29

0.06

20.7

$ 0.87

$ 0.76

0.11

14.5

Weighted average shares outstanding – basic

484,635

484,317

484,565

484,231

Weighted average shares outstanding – diluted

484,670

484,359

484,598

484,270

Reconciliation of Net Income to EBITDA, Adjusted EBITDA, EBITDA Margin, Incremental EBITDA Margin, Adjusted EBITDA Margin, and Adjusted Incremental EBITDA Margin

Net income

$ 163,527

$ 136,913

$ 410,264

$ 360,704

Depreciation and amortization

32,231

27,664

93,177

82,685

Interest expense, net

7,942

7,150

21,118

22,650

Provision for income taxes

53,902

48,315

135,954

124,176

EBITDA

$ 257,602

$ 220,042

37,560

17.1

$ 660,513

$ 590,215

70,298

11.9

Acquisition-related expenses (1)

1,082

—

2,164

1,049

Gain on sale of assets, net (2)

(350)

(582)

(1,334)

(933)

Adjusted EBITDA

$ 258,334

$ 219,460

38,874

17.7

$ 661,343

$ 590,331

71,012

12.0

Revenues

$ 1,026,106

$ 916,270

109,836

$ 2,848,137

$ 2,556,539

291,598

EBITDA margin

25.1 %

24.0 %

23.2 %

23.1 %

Incremental EBITDA margin

34.2 %

24.1 %

Adjusted EBITDA margin

25.2 %

24.0 %

23.2 %

23.1 %

Adjusted incremental EBITDA margin

35.4 %

24.4 %

Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow and Free Cash Flow Conversion

Net cash provided by operating activities

$ 191,349

$ 146,947

$ 513,363

$ 419,495

Capital expenditures

(8,503)

(7,522)

(22,360)

(23,389)

Free cash flow

$ 182,846

$ 139,425

43,421

31.1

$ 491,003

$ 396,106

94,897

24.0

Free cash flow conversion

111.8 %

101.8 %

119.7 %

109.8 %

Three Months Ended September 30,

Nine Months Ended September 30,

2025

2024

2025

2024

Reconciliation of SG&A to Adjusted SG&A

SG&A

$ 301,404

$ 274,918

$ 859,513

$ 769,522

Acquisition-related expenses (1)

1,082

—

2,164

1,049

Adjusted SG&A

$ 300,322

$ 274,918

$ 857,349

$ 768,473

Revenues

$ 1,026,106

$ 916,270

$ 2,848,137

$ 2,556,539

Adjusted SG&A as a % of revenues

29.3 %

30.0 %

30.1 %

Period Ended

September 30, 2025

Period Ended

December 31, 2024

Reconciliation of Debt and Net Income to Leverage Ratio

Short-term debt (5)

$ —

Long-term debt (6)

500,000

397,000

Operating lease liabilities (7)

426,423

417,218

Cash adjustment (8)

(114,621)

(80,667)

Adjusted net debt

$ 811,802

$ 733,551

Net income

$ 515,939

$ 466,379

Depreciation and amortization

123,712

113,220

Interest expense, net

26,145

27,677

Provision for income taxes

175,629

163,851

Operating lease cost (9)

154,191

133,420

Stock-based compensation expense

37,086

29,984

Adjusted EBITDAR

$ 1,032,702

$ 934,531

Leverage ratio

0.8x

(1) Consists of expenses resulting from the amortization of intangible assets and adjustments to the fair value of contingent consideration resulting from the acquisitions of Fox Pest Control and Saela Pest Control. While we exclude such expenses in this non-GAAP measure, the revenue from the acquired companies is reflected in this non-GAAP measure and the acquired assets contribute to revenue generation.

(2) Consists of the gain or loss on the sale of non-operational assets.

(3) The tax effect of the adjustments is calculated using the applicable statutory tax rates for the respective periods.

(4) In some cases, the sum of the individual EPS amounts may not equal total adjusted EPS calculations due to rounding.

(5) As of September 30, 2025 and December 31, 2024, the Company had no outstanding borrowings under our commercial paper program. The Company's short-term borrowings are presented under the short-term debt caption of our condensed consolidated statement of financial position, net of unamortized discounts.

(6) As of September 30, 2025, the Company had outstanding borrowings of $500.0 million from the issuance of our 2035 Senior Notes and no outstanding borrowings under the Revolving Credit Facility. These borrowings are presented under the long-term debt caption of our condensed consolidated statement of financial position, net of a $7.3 million unamortized discount and $7.0 million in unamortized debt issuance costs as of September 30, 2025. As of December 31, 2024, the Company had outstanding borrowings of $397.0 million under the Revolving Credit Facility. Borrowings under the Revolving Credit Facility are presented under the long-term debt caption of our condensed consolidated statement of financial position, net of $1.7 million in unamortized debt issuance costs as of December 31, 2024.

(7) Operating lease liabilities are presented under the operating lease liabilities - current and operating lease liabilities, less current portion captions of our condensed consolidated statement of financial position.

(8) Represents 90% of cash and cash equivalents per our condensed consolidated statement of financial position as of both periods presented.

(9) Operating lease cost excludes short-term lease cost associated with leases that have a duration of 12 months or less.

For Further Information Contact

Lyndsey Burton (404) 888-2348

SOURCE Rollins, Inc.