ABM Industries Enters Settlement Agreement
ABM (NYSE: ABM) has reached a $140 million settlement regarding the longstanding Bucio overtime case, which was filed in 2006.
Sentiment and the balance of points
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Rhea-AI Summary
ABM (NYSE: ABM) has reached a $140 million settlement regarding the longstanding Bucio overtime case, which was filed in 2006. This settlement, pending court approval, addresses claims related to a legacy timekeeping system no longer in use since 2013. To facilitate this settlement, ABM will reserve $110 million in Q3 2021, in addition to a previously reserved $30 million. While the company admits no wrongdoing, it asserts the settlement alleviates ongoing litigation costs and uncertainties, allowing focus on strategic growth. Updated GAAP income guidance will follow in early September.
Positive
- Settlement of $140 million may reduce long-term litigation costs and uncertainties.
- Access to significant resources for strategic growth due to a strong financial position and increased credit line.
Negative
- Immediate reserve of $110 million may impact cash flow in the short term.
Details
News Market Reaction – ABM
The recorded move for ABM in the trading session of this news was +1.25%.
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AI-generated analysis. How Rhea-AI works. Not financial advice.
NEW YORK, July 08, 2021 (GLOBE NEWSWIRE) -- ABM (NYSE: ABM), a leading provider of facility solutions, has entered into a written settlement agreement in the consolidated action ABM Industries Overtime Cases (also known as the “Bucio case”), pending in the Superior Court of California, County of San Francisco. Filed in 2006, the case relates primarily to a legacy timekeeping system that has not been in use by ABM since 2013. The settlement is subject to court approval.
Under the terms of the settlement agreement, the Company has agreed to pay a total sum of
“We are confident this settlement is in the best interests of ABM and our stakeholders, as it removes the ongoing costs and uncertainty associated with protracted litigation. Our strong financial position, free cash flow and recently increased credit line provide us with significant resources to pursue our strategic growth priorities,” said Scott Salmirs, President and Chief Executive Officer of ABM Industries.
The Company will update its full year GAAP income guidance to reflect the settlement when it issues its third quarter results in early September. ABM’s full year adjusted income guidance remains unchanged.
ABOUT ABM
ABM (NYSE: ABM) is a leading provider of facility solutions with revenues of approximately
Contact:
Investor Relations:
David Gold
(212) 750-5800
ir@abm.com
Media:
Michael Valentino
michael.valentino@abm.com
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