Enters into $250 Million Accounts Receivable
Securitization Facility
Third Quarter 2024 Results and Subsequent Event
Highlights
- Revenue of $698 million decreased 1.6% year-over-year or 1.4%
excluding the impact of FX
- Operating Income of $38 million or 5.4% of revenue
- Adjusted EBITDA of $87 million or 12.4% of revenue
- Operating Cash Flow of $176 million fiscal year-to-date, up
22.4% year-over-year
- Free Cash Flow of $125 million fiscal year-to-date, up 22.6%
year-over-year
- Net leverage was 3.98x and net debt was $1.53 billion at the
end of Q3
- Pro forma Q3 net leverage declines to 3.33x and pro forma Q3
net debt declines to $1.28 billion, assuming $250 million debt
repayment using proceeds from the Accounts Receivable
Securitization Facility
Vestis Corporation (NYSE: VSTS), a leading provider of uniforms
and workplace supplies, today announced its results for the third
quarter ended June 28, 2024. The company also reiterated its
outlook for fiscal year 2024 and expects that Adjusted EBITDA
margin will now be toward the higher end of the guidance range.
Management Commentary
“I’m pleased we are on track to deliver our commitments in the
second half and remain energized by the value creation
opportunities ahead for Vestis,” said Kim Scott, President and CEO.
“We continue to demonstrate the health of our business as we
leverage our strong cash flows and effectively manage our balance
sheet to reduce our net debt. We’ve also taken decisive actions to
ensure we are well positioned and mobilized to accelerate our
performance.”
Third Quarter 2024 Financial Summary
This press release contains non-GAAP financial measures.
Reconciliations of non-GAAP financial measures to the comparable
GAAP measures are presented in the tables accompanying this
release.
($ in millions)
Consolidated
Three Months Ended
June 28, 2024
June 30, 2023
Change
Revenue
$
698.2
$
709.4
(1.6
)%
Operating Income
37.5
66.3
(43.4
)%
Adjusted Operating Income
58.4
78.7
(25.8
)%
Net Income
5.0
48.9
(89.9
)%
Adjusted EBITDA
86.8
106.3
(18.3
)%
Adjusted EBITDA Margin
12.4
%
15.0
%
(260 bps)
Vestis’ third quarter fiscal 2024 revenue decreased 1.6% versus
the third quarter of fiscal 2023. Excluding the impact of foreign
currency, Vestis’ revenue decreased 1.4%.
Third quarter fiscal 2024 adjusted EBITDA margin declined by 260
basis points, which included an approximately 100 basis point
impact from higher public company costs as compared to the prior
year. The impact from lost business and the incremental public
company costs outweighed the favorable impact from new volume
growth and pricing in the quarter.
Balance Sheet and Cash Flow
Vestis’ net cash provided by operating activities of $176.2
million for the nine months ended June 28, 2024 increased 22.4%
relative to the comparable period of fiscal 2023. Free cash flow of
$125.4 million for the nine months ended June 28, 2024 increased
22.6% relative to the comparable period of fiscal 2023.
As of June 28, 2024, total principal debt outstanding was $1.42
billion, which represents a $17 million reduction in the quarter of
which $15 million was voluntarily prepaid. Net leverage was 3.98x
at the end of the third quarter of fiscal 2024 compared to 3.95x at
the end of fiscal 2023.
Vestis Enters into $250 Million Accounts Receivable
Securitization Facility
On August 2, 2024, certain wholly-owned subsidiaries of Vestis
entered into a three-year $250 million accounts receivable
securitization facility (the “A/R Facility”). Under the A/R
Facility, these subsidiaries transfer accounts receivable and
certain related assets to VS Financing, LLC, a bankruptcy remote
special purpose entity formed as a wholly-owned subsidiary, who in
turn, may sell the receivables to a financial institution. The net
proceeds from the A/R Facility will be used to repay a portion of
the outstanding borrowings under the existing term loans.
Net leverage and outstanding net debt would have been
approximately 3.33x and $1.28 billion, respectively, at the end of
the third quarter of fiscal 2024 assuming 100% of the proceeds from
the A/R Facility were used to reduce the then-outstanding principal
debt, and all other components remained unchanged.
Fiscal Year 2024 Outlook
We continue to expect to deliver fiscal 2024 revenue growth in
the range of (1)% to 0%. We also expect fiscal 2024 Adjusted EBITDA
Margin to be toward the higher end of the range between 12.0% and
12.4%, inclusive of approximately $18 million in incremental public
company costs in the period.
Our strategic imperatives include disciplined capital allocation
with deleveraging as a priority, as evidenced by the execution of
the A/R Facility. We continue to expect strong free cash flow
conversion and anticipate a ratio of free cash flow to net income
greater than or equal to 100%.
Forward Looking Non-GAAP Information
This release includes certain non-GAAP financial information
that is forward-looking in nature, including without limitation
adjusted EBITDA margin. Vestis believes that a quantitative
reconciliation of such forward-looking information to the most
comparable financial measure calculated and presented in accordance
with GAAP cannot be made available without unreasonable efforts. A
reconciliation of these non-GAAP financial measures would require
Vestis to predict the timing and likelihood of among other things
future acquisitions and divestitures, restructurings, asset
impairments, other charges and other factors not within Vestis’
control. Neither these forward-looking measures, nor their probable
significance, can be quantified with a reasonable degree of
accuracy. Accordingly, the most directly comparable forward-looking
GAAP measures are not provided. Forward-looking non-GAAP financial
measures provided without the most directly comparable GAAP
financial measures may vary materially from the corresponding GAAP
financial measures. The estimates of revenue growth for fiscal year
2024 and adjusted EBITDA margin for fiscal year 2024 do not attempt
to forecast currency fluctuations and, accordingly, reflect an
assumption of constant currency.
Conference Call Information
Vestis will host a webcast to discuss its fiscal third quarter
2024 results and outlook on Wednesday, August 7, 2024 at 10:00 AM
ET. The webcast can be accessed live through the investor relations
section of the Company’s website at www.vestis.com. Additionally, a
slide presentation will accompany the call and will also be
available on the Company’s website. A replay of the live event will
be available on the Company’s website shortly after the call for 90
days.
About Vestis™
Vestis is a leader in the B2B uniform and workplace supplies
category. Vestis provides uniform services and workplace supplies
to a broad range of North American customers from Fortune 500
companies to locally owned small businesses across a broad set of
end sectors. The Company’s comprehensive service offering primarily
includes a full-service uniform rental program, floor mats, towels,
linens, managed restroom services, first aid supplies, and
cleanroom and other specialty garment processing.
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of the securities laws. All statements that reflect our
expectations, assumptions or projections about the future, other
than statements of historical fact, are forward-looking statements,
including, without limitation, forecasts relating to discussions of
future operations and financial performance and statements
regarding our strategy for growth, future product development,
regulatory approvals, competitive position and expenditures. In
some cases, forward-looking statements can be identified by words
such as “outlook,” “anticipate,” “continue,” “estimate,” “expect,”
“will be,” “believe,” “well positioned,” “mobilized,” “on track,”
“opportunities,” and other words and terms of similar meaning or
the negative versions of such words. These forward-looking
statements are subject to risks and uncertainties that may change
at any time, and actual results or outcomes may differ materially
from those that we expected. Forward-looking statements are not
guarantees of future performance and are subject to risks,
uncertainties, and changes in circumstances that are difficult to
predict including, but not limited to: unfavorable economic
conditions; increases in fuel and energy costs; the failure to
retain current customers, renew existing customer contracts and
obtain new customer contracts; natural disasters, global
calamities, climate change, pandemics, strikes and other adverse
incidents; increased operating costs and obstacles to cost recovery
due to the pricing and cancellation terms of our support services
contracts; a determination by our customers to reduce their
outsourcing or use of preferred vendors; risks associated with
suppliers from whom our products are sourced; challenge of
contracts by our customers; our expansion strategy and our ability
to successfully integrate the businesses we acquire and costs and
timing related thereto; currency risks and other risks associated
with international operations; our inability to hire and retain key
or sufficient qualified personnel or increases in labor costs;
continued or further unionization of our workforce; liability
resulting from our participation in multiemployer-defined benefit
pension plans; liability associated with noncompliance with
applicable law or other governmental regulations; laws and
governmental regulations including those relating to the
environment, wage and hour and government contracting; increases or
changes in income tax rates or tax-related laws; new
interpretations of or changes in the enforcement of the government
regulatory framework; a cybersecurity incident or other disruptions
in the availability of our computer systems or privacy breaches;
stakeholder expectations relating to environmental, social and
governance considerations; the expected benefits of the separation
from Aramark and the risk that conditions to the separation will
not be satisfied; the risk of increased costs from lost synergies;
retention of existing management team members as a result of the
separation from Aramark; reaction of customers, employees and other
parties to the separation from Aramark, and the impact of the
separation on our business; our leverage and ability to meet debt
obligations; any failure by Aramark to perform its obligations
under the various separation agreements entered into in connection
with the separation and distribution; a determination by the IRS
that the distribution or certain related transactions are taxable;
and the and the timing and occurrence (or non-occurrence) of other
transactions, events and circumstances which may be beyond our
control. The above list of factors is not exhaustive or necessarily
in order of importance. For additional information on identifying
factors that may cause actual results to vary materially from those
stated in forward-looking statements, see Vestis’ filings with the
Securities and Exchange Commission. Any forward-looking statement
speaks only as of the date on which it is made, and we assume no
obligation to update or revise such statement, whether as a result
of new information, future events or otherwise, except as required
by applicable law.
VESTIS CORPORATION
CONSOLIDATED AND COMBINED
STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share
amounts)
Three Months Ended
Nine Months Ended
June 28, 2024
June 30, 2023
June 28, 2024
June 30, 2023
Revenue
$
698,248
$
709,384
$
2,121,539
$
2,109,385
Operating Expenses:
Cost of services provided (exclusive of
depreciation and amortization)
495,759
484,568
1,502,557
1,480,143
Depreciation and amortization
34,925
34,204
105,500
101,712
Selling, general and administrative
expenses
130,041
124,245
385,307
367,396
Total Operating Expenses
660,725
643,017
1,993,364
1,949,251
Operating Income
37,523
66,367
128,175
160,134
Interest Expense and Other, net
(29,386
)
(83
)
(94,874
)
268
Income Before Income Taxes
8,137
66,284
33,301
160,402
Provision for Income Taxes
3,100
17,421
10,033
41,216
Net Income
$
5,037
$
48,863
$
23,268
$
119,186
Earnings per share:
Basic
$
0.04
$
0.37
$
0.18
$
0.91
Diluted
$
0.04
$
0.37
$
0.18
$
0.91
Weighted Average Shares
Outstanding(1):
Basic
131,543
130,725
131,486
130,725
Diluted
131,833
130,725
131,785
130,725
__________________
(1) During the three and nine months ended
June 30, 2023, Vestis was not a publicly traded company, and
therefore, did not have available or issued shares of common stock
outstanding. In accordance with United States Generally Accepted
Accounting Principles, the Company elected to use the number of
shares of common stock distributed to shareholders of Aramark upon
the separation of Vestis from Aramark as the weighted average
shares outstanding to calculate earnings per share on the combined
results for three and nine months ended June 30, 2023.
VESTIS CORPORATION
CONSOLIDATED AND COMBINED
BALANCE SHEETS
(Unaudited)
(In thousands, except per share
amounts)
June 28, 2024
September 29,
2023
ASSETS
Current Assets:
Cash and cash equivalents
$
29,098
$
36,051
Receivables (net of allowances: $19,540
and $25,066)
409,926
392,916
Inventories, net
153,539
174,719
Rental merchandise in service, net
398,616
399,035
Other current assets
28,778
17,244
Total current assets
1,019,957
1,019,965
Property and Equipment, at cost:
Land, buildings and improvements
582,758
585,797
Equipment
1,154,184
1,110,812
1,736,942
1,696,609
Less - Accumulated depreciation
(1,081,039
)
(1,032,078
)
Total property and equipment, net
655,903
664,531
Goodwill
963,036
963,543
Other Intangible Assets, net
219,010
238,608
Operating Lease Right-of-use Assets
70,241
57,890
Other Assets
217,483
212,587
Total Assets
$
3,145,630
$
3,157,124
LIABILITIES AND EQUITY
Current Liabilities:
Current maturities of long-term
borrowings
$
8,000
$
26,250
Current maturities of financing lease
obligations
29,701
27,659
Current operating lease liabilities
19,857
19,935
Accounts payable
150,542
134,498
Accrued payroll and related expenses
104,569
113,771
Accrued expenses and other current
liabilities
117,123
73,412
Total current liabilities
429,792
395,525
Long-Term Borrowings
1,394,528
1,462,693
Noncurrent Financing Lease Obligations
111,930
105,217
Noncurrent Operating Lease Liabilities
57,707
46,084
Deferred Income Taxes
200,379
217,647
Other Noncurrent Liabilities
50,117
52,598
Total Liabilities
2,244,453
2,279,764
Commitments and Contingencies
Equity:
Common stock, par value $0.01 per share,
350,000,000 shares authorized, 131,477,853 shares issued and
outstanding as of June 28, 2024
1,315
—
Additional paid-in capital
925,077
—
Retained earnings
9,466
—
Net parent investment
—
908,533
Accumulated other comprehensive loss
(34,681
)
(31,173
)
Total Equity
901,177
877,360
Total Liabilities and Equity
$
3,145,630
$
3,157,124
VESTIS CORPORATION
CONDENSED CONSOLIDATED AND
COMBINED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
Nine months ended
June 28, 2024
June 30, 2023
Net cash provided by operating
activities
$
176,200
$
143,937
Cash flows from investing activities:
Purchases of property and equipment and
other
(50,787
)
(52,641
)
Disposals of property and equipment
—
10,968
Other investing activities
—
75
Net cash used in investing activities
(50,787
)
(41,598
)
Cash flows from financing activities:
Proceeds from long-term borrowings
798,000
—
Payments of long-term borrowings
(879,500
)
—
Payments of financing lease
obligations
(22,572
)
(20,803
)
Net cash distributions to Parent
(6,051
)
(91,706
)
Dividend payments
(9,199
)
—
Debt issuance costs
(11,134
)
—
Other financing activities
(1,853
)
—
Net cash used in financing activities
(132,309
)
(112,509
)
Effect of foreign exchange rates on cash
and cash equivalents
(57
)
682
(Decrease) increase in cash and cash
equivalents
(6,953
)
(9,488
)
Cash and cash equivalents, beginning of
period
36,051
23,736
Cash and cash equivalents, end of
period
$
29,098
$
14,248
Non-GAAP Definitions
This release could include certain non-GAAP financial measures,
such as Adjusted Revenue Growth (Organic), Adjusted Revenue
(Organic), Adjusted Revenue Growth excluding Temporary Energy Fee,
Adjusted Revenue excluding Temporary Energy Fee, Adjusted Operating
Income, Adjusted Operating Income Margin, Adjusted EBITDA, Adjusted
EBITDA Margin, Free Cash Flow, Net Debt, Net Leverage, and Trailing
Twelve Months Adjusted EBITDA. Vestis utilizes these measures when
monitoring and evaluating operating performance. The non-GAAP
financial measures presented herein are supplemental measures of
Vestis’ performance that Vestis believes help investors because
they enable better comparisons of Vestis’ historical results and
allow Vestis’ investors to evaluate its performance based on the
same metrics that Vestis uses to evaluate its performance and
trends in its results. Vestis’ presentation of these metrics has
limitations as an analytical tool and should not be considered in
isolation or as a substitute for analysis of Vestis’ results as
reported under U.S. GAAP. Because of their limitations, these
non-GAAP financial measures should not be considered as measures of
cash available to Vestis to invest in the growth of Vestis’
business or that will be available to Vestis to meet its
obligations. Vestis compensates for these limitations by using
these non-GAAP financial measures along with other comparative
tools, together with U.S. GAAP financial measures, to assist in the
evaluation of operating performance. You should not consider these
measures as alternatives to revenue, operating income, operating
income margin, net income, net income margin or net cash provided
by operating activities determined in accordance with U.S. GAAP.
Vestis believes that these non-GAAP financial measures, in addition
to the corresponding U.S. GAAP financial measures, are important
supplemental measures which exclude non-cash or other items that
may not be indicative of or are unrelated to Vestis’ core operating
results and the overall health of Vestis. Non-GAAP financial
measures as presented by Vestis may not be comparable to other
similarly titled measures of other companies because not all
companies use identical calculations.
Adjusted Revenue Growth (Organic)
Adjusted Revenue Growth (Organic) measures our revenue growth
trends excluding the impact of acquisitions and foreign currency,
and we believe it is useful for investors to understand growth
through internal efforts. We define “organic revenue growth” as the
growth in revenues, excluding (i) acquisitions, (ii) the impact of
foreign currency exchange rate changes, and (iii) the impact of the
53rd week, when applicable.
Adjusted Revenue (Organic)
Adjusted Revenue (Organic) represents revenue as determined in
accordance with U.S. GAAP, adjusted to exclude (i) acquisitions,
(ii) the impact of foreign currency exchange rate changes, and
(iii) the impact of the 53rd week, when applicable.
Adjusted Revenue Growth excluding Temporary Energy
Fee
We define “adjusted revenue growth excluding temporary energy
fee” as the growth in revenues, excluding (i) acquisitions, (ii)
the impact of foreign currency exchange rate changes, (iii) the
impact of the 53rd week, when applicable and (iv) the impact of the
temporary energy fee, when applicable. We believe it is useful for
investors to understand growth through internal efforts.
Adjusted Revenue excluding Temporary Energy Fee
Adjusted Revenue excluding Temporary Energy Fee represents
revenue as determined in accordance with U.S. GAAP, adjusted to
exclude (i) acquisitions, (ii) the impact of foreign currency
exchange rate changes, (iii) the impact of the 53rd week, when
applicable, and (iv) the impact of the temporary energy fee, when
applicable.
Adjusted Operating Income
Adjusted Operating Income represents Operating Income adjusted
for Amortization Expense of Acquired Intangibles; Share-based
Compensation Expense; Severance and Other Charges; Merger and
Integration Related Charges; Management Fee; Separation Related
Charges; Estimated Impact of 53rd Week, when applicable; and Gain,
Losses, Settlements and Other Items impacting comparability.
Adjusted results are presented in order to reflect the results in a
manner that allows a better understanding of operational activities
separate from the financial impact of decisions made for the
long-term benefit of the company and other items impacting
comparability between periods. Similar adjustments have been
recorded in earlier periods and similar types of adjustments can
reasonably be expected to be recorded in future periods.
Adjusted Operating Income Margin
Adjusted Operating Income Margin represents Adjusted Operating
Income as a percentage of Revenue.
Adjusted EBITDA
Adjusted EBITDA represents Net Income adjusted for Provision for
Income Taxes; Interest Expense and Other, net; and Depreciation and
Amortization (EBTIDA), further adjusted for Share-based
Compensation Expense; Severance and Other Charges; Merger and
Integration Charges; Management Fee; Separation Related Charges;
Estimated Impact of 53rd Week (when applicable); Gains, Losses,
Settlements; and other items impacting comparability. Adjusted
results are presented in order to reflect the results in a manner
that allows a better understanding of operational activities
separate from the financial impact of decisions made for the
long-term benefit of the company and other items impacting
comparability between periods. Similar adjustments have been
recorded in earlier periods and similar types of adjustments can
reasonably be expected to be recorded in future periods.
Adjusted EBITDA Margin
Adjusted EBITDA Margin is Adjusted EBITDA as a percentage of
Revenue.
Free Cash Flow
Free Cash Flow represents Net cash provided by operating
activities adjusted for Purchases of Property and Equipment and
Other and Disposals of property and equipment.
Net Debt
Net Debt represents total principal debt outstanding and finance
lease obligations, less cash and cash equivalents.
Pro forma Net Debt
Pro forma Net Debt represents total principal debt outstanding
and finance lease obligations, less cash and cash equivalents,
adjusted for the estimated proceeds from the A/R Facility used to
reduce the outstanding principal debt balance.
Net Leverage
Net Leverage represents Net Debt divided by the Trailing Twelve
Months Adjusted EBITDA.
Pro forma Net Leverage
Pro forma Net Leverage represents Pro forma Net Debt divided by
the Trailing Twelve Months Adjusted EBITDA.
Trailing Twelve Months Adjusted EBITDA
Trailing Twelve Months Adjusted EBITDA represents Adjusted
EBITDA for the preceding four fiscal quarters.
VESTIS CORPORATION
RECONCILIATION OF NON-GAAP
MEASURES
(In millions)
United States
Canada
Corporate
Consolidated
Three Months Ended
Three Months Ended
Three Months Ended
Three Months Ended
June 28,
June 30,
June 28,
June 30,
June 28,
June 30,
June 28,
June 30,
2024
2023
2024
2023
2024
2023
2024
2023
Revenue (as reported)
$
636.8
$
646.5
$
61.4
$
62.9
$
698.2
$
709.4
Effect of Currency Translation on Current
Year Revenue
—
—
1.3
—
1.3
—
Adjusted Revenue (Organic)
$
636.8
$
646.5
$
62.7
$
62.9
$
699.5
$
709.4
Temporary Energy Fee
—
—
—
—
—
—
Adjusted Revenue excluding Temporary
Energy Fee
$
636.8
$
646.5
$
62.7
$
62.9
$
699.5
$
709.4
Revenue Growth (as reported)
(1.5
)%
4.6
%
(2.4
)%
2.1
%
(1.6
)%
4.4
%
Adjusted Revenue Growth (Organic)
(1.5
)%
4.6
%
(0.3
)%
7.5
%
(1.4
)%
4.9
%
Adjusted Revenue Growth excluding
Temporary Energy Fee
(1.5
)%
4.6
%
(0.3
)%
7.5
%
(1.4
)%
4.9
%
Operating Income (as reported)
$
64.5
$
84.0
$
1.2
$
3.3
$
(28.2
)
$
(21.0
)
$
37.5
$
66.3
Amortization Expense
6.4
6.4
0.1
0.1
—
—
6.5
6.5
Share-Based Compensation
—
—
—
—
3.9
3.6
3.9
3.6
Severance and Other Charges
0.7
(0.8
)
0.2
—
—
—
0.9
(0.8
)
Separation Related Charges
—
—
—
—
5.4
6.0
5.4
6.0
Management Fee
(1.9
)
(1.9
)
1.9
1.9
—
—
—
—
Gain, Losses, and Settlements
4.2
(2.9
)
—
—
—
—
4.2
(2.9
)
Total Operating Income Adjustments
$
9.4
$
0.8
$
2.2
$
2.0
$
9.3
$
9.6
$
20.9
$
12.4
Adjusted Operating Income (Non-GAAP)
$
73.9
$
84.8
$
3.4
$
5.3
$
(18.9
)
$
(11.4
)
$
58.4
$
78.7
Depreciation Expense
25.7
25.0
2.7
2.5
—
0.1
28.4
27.6
Adjusted EBITDA (Non-GAAP)
$
99.6
$
109.8
$
6.1
$
7.8
$
(18.9
)
$
(11.3
)
$
86.8
$
106.3
Operating Income Margin (as reported)
10.1
%
13.0
%
2.0
%
5.2
%
5.4
%
9.3
%
Adjusted Operating Income Margin
(Non-GAAP)
11.6
%
13.1
%
5.5
%
8.4
%
8.4
%
11.1
%
Adjusted EBITDA Margin (Non-GAAP)
15.6
%
17.0
%
9.9
%
12.4
%
12.4
%
15.0
%
Net Income (as reported)
$
5.0
$
48.9
Operating Income Adjustments (Above)
20.9
12.4
Tax Impact of Operating Income
Adjustments
(4.6
)
(3.2
)
Adjusted Net Income (Non-GAAP)
$
21.3
$
58.1
Basic weighted-average shares outstanding
(millions)
131.5
130.7
Diluted weighted-average shares
outstanding (millions)
131.8
130.7
Basic Earnings Per Share
$
0.04
$
0.37
Diluted Earnings Per Share
$
0.04
$
0.37
Adjusted Basic Earnings Per Share
$
0.16
$
0.44
Adjusted Diluted Earnings Per Share
$
0.16
$
0.44
VESTIS CORPORATION
RECONCILIATION OF NON-GAAP
MEASURES
(In millions)
United States
Canada
Corporate
Consolidated
Nine Months Ended
Nine Months Ended
Nine Months Ended
Nine Months Ended
June 28,
June 30,
June 28,
June 30,
June 28,
June 30,
June 28,
June 30,
2024
2023
2024
2023
2024
2023
2024
2023
Revenue (as reported)
$
1,932.1
$
1,921.1
$
189.4
$
188.3
$
2,121.5
$
2,109.4
Effect of Currency Translation on Current
Year Revenue
—
—
1.3
—
1.3
—
Adjusted Revenue (Organic)
$
1,932.1
$
1,921.1
$
190.7
$
188.3
$
2,122.8
$
2,109.4
Temporary Energy Fee
—
26.7
—
—
—
26.7
Adjusted Revenue excluding Temporary
Energy Fee
$
1,932.1
$
1,894.4
$
190.7
$
188.3
$
2,122.8
$
2,082.7
Revenue Growth (as reported)
0.6
%
5.3
%
0.6
%
4.6
%
0.6
%
5.3
%
Adjusted Revenue Growth (Organic)
0.6
%
5.3
%
1.3
%
11.7
%
0.6
%
5.9
%
Adjusted Revenue Growth excluding
Temporary Energy Fee
2.0
%
3.9
%
1.3
%
11.7
%
1.9
%
4.6
%
Operating Income (as reported)
$
209.8
$
216.1
$
6.8
$
10.2
$
(88.4
)
$
(66.2
)
$
128.2
$
160.1
Amortization Expense
19.2
19.2
0.3
0.3
—
—
19.5
19.5
Share-Based Compensation
—
—
—
—
13.3
11.6
13.3
11.6
Severance and Other Charges
0.5
4.9
0.2
(0.2
)
—
—
0.7
4.7
Separation Related Charges
—
—
—
—
18.5
12.9
18.5
12.9
Management Fee
(5.7
)
(5.7
)
5.7
5.7
—
—
—
—
Gain, Losses, and Settlements
6.2
(7.4
)
—
—
—
7.7
6.2
0.3
Total Operating Income Adjustments
$
20.2
$
11.0
$
6.2
$
5.8
$
31.8
$
32.2
$
58.2
$
49.0
Adjusted Operating Income (Non-GAAP)
$
230.0
$
227.1
$
13.0
$
16.0
$
(56.6
)
$
(34.0
)
$
186.4
$
209.1
Depreciation Expense
77.6
74.2
8.3
7.5
0.1
0.3
86.0
82.0
Adjusted EBITDA (Non-GAAP)
$
307.6
$
301.3
$
21.3
$
23.5
$
(56.5
)
$
(33.7
)
$
272.4
$
291.1
Operating Income Margin (as reported)
10.9
%
11.2
%
3.6
%
5.4
%
6.0
%
7.6
%
Adjusted Operating Income Margin
(Non-GAAP)
11.9
%
11.8
%
6.9
%
8.5
%
8.8
%
9.9
%
Adjusted EBITDA Margin (Non-GAAP)
15.9
%
15.7
%
11.2
%
12.5
%
12.8
%
13.8
%
Net Income (as reported)
$
23.3
$
119.2
Operating Income Adjustments (Above)
58.2
49.0
Tax Impact of Operating Income
Adjustments
(13.8
)
(12.6
)
Adjusted Net Income (Non-GAAP)
$
67.7
$
155.6
Basic weighted-average shares outstanding
(millions)
131.5
130.7
Diluted weighted-average shares
outstanding (millions)
131.8
130.7
Basic Earnings Per Share
$
0.18
$
0.91
Diluted Earnings Per Share
$
0.18
$
0.91
Adjusted Basic Earnings Per Share
$
0.51
$
1.19
Adjusted Diluted Earnings Per Share
$
0.51
$
1.19
VESTIS CORPORATION
RECONCILIATION OF NON-GAAP
MEASURES
(In millions)
Operating Income for the fiscal year ended
September 29, 2023 (as reported in the Company's Form 10-K)
$
217.9
Amortization Expense
26.0
Share-Based Compensation
14.5
Severance and Other Charges
4.9
Separation Related Charges
31.1
Gain, Losses, and Settlements
(0.8
)
Depreciation Expense
110.3
Trailing Twelve Months Adjusted EBITDA for
the period ended September 29, 2023 (Non-GAAP)
$
403.9
Less Adjusted EBITDA (Non-GAAP) for the
nine months ended June 30, 2023
(291.1
)
Plus Adjusted EBITDA (Non-GAAP) for the
nine months ended June 28, 2024
272.4
Trailing Twelve Months Adjusted EBITDA for
the period ended June 28, 2024 (Non-GAAP)
$
385.2
VESTIS CORPORATION
RECONCILIATION OF NON-GAAP
MEASURES
FREE CASH FLOW, NET DEBT, NET
LEVERAGE, AND PRO FORMA NET LEVERAGE
(In millions)
Nine Months Ended
June 28, 2024
June 30, 2023
Net cash provided by operating
activities
$
176.2
$
143.9
Purchases of property and equipment and
other
(50.8
)
(52.6
)
Disposals of property and equipment
—
11.0
Free Cash Flow (Non-GAAP)
$
125.4
$
102.3
As of
June 28, 2024
September 29, 2023
Total principal debt outstanding
$
1,420.5
$
1,500.0
Finance lease obligations
141.6
132.9
Less: Cash and cash equivalents
(29.1
)
(36.1
)
Net Debt (Non-GAAP)
$
1,533.0
$
1,596.8
Net Leverage (Non-GAAP)
3.98
3.95
Twelve months ended
June 28, 2024
September 29, 2023
Trailing Twelve Months Adjusted EBITDA
(Non-GAAP)
$
385.2
$
403.9
As of
Pro forma as of
June 28, 2024
A/R Facility Adjustment1
June 28, 2024
Total principal debt outstanding
$
1,420.5
$
(250.0
)
$
1,170.5
Finance lease obligations
141.6
—
141.6
Less: Cash and cash equivalents
(29.1
)
—
(29.1
)
Net Debt (Non-GAAP)
$
1,533.0
$
(250.0
)
$
1,283.0
Net Leverage (Non-GAAP)
3.98
3.33
__________________
(1) The A/R Facility Adjustment represents
the estimated amount of principal debt the Company would have paid
down using the proceeds from the A/R Facility as of June 28,
2024.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240807696858/en/
Investors Michael Aurelio, CFA 470-653-5015
michael.aurelio@vestis.com
Media Danielle Holcomb 470-716-0917
danielle.holcomb@vestis.com
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