ROLLINS INC

Previous wording

•First quarter revenues were $906.4 million, an increase of 10.2% over the first quarter of 2025 with organic revenues* increasing 6.6%. This represents our 98th consecutive quarter of revenue growth.

Current wording

•Second quarter revenues were $1.1 billion, an increase of 7.9% over the second quarter of 2025 with organic revenues* increasing 5.7%. This represents our 99th consecutive quarter of revenue growth.

Previous wording

•Quarterly operating income was $145.5 million, an increase of 2.0% over the first quarter of 2025. Quarterly operating margin was 16.1%, a decrease of 120 basis points versus the first quarter of 2025. Adjusted operating income* was $152.8 million, an increase of 4.0% over the prior year. Adjusted operating margin* was 16.9%, a decrease of 100 basis points compared to the prior year.

Current wording

•Quarterly operating income was $201.4 million, an increase of 1.5% over the second quarter of 2025. Quarterly operating margin was 18.7%, a decrease of 110 basis points versus the second quarter of 2025. Adjusted operating income* was $209.9 million, an increase of 2.0% over the prior year. Adjusted operating margin* was 19.5%, a decrease of 110 basis points compared to the prior year.

Previous wording

•Quarterly net income was $107.8 million, an increase of 2.5% over the prior year. Adjusted net income* was $113.2 million, an increase of 5.0% over the prior year.

Current wording

•Quarterly net income was $143.9 million, an increase of 1.7% over the prior year. Adjusted net income* was $151.9 million, an increase of 3.4% over the prior year.

Previous wording

•Adjusted EBITDA* was $179.5 million, an increase of 4.4% over the prior year. Adjusted EBITDA margin* was 19.8%, a decrease of 110 basis points versus the first quarter of 2025.

Current wording

•Adjusted EBITDA* was $236.3 million, an increase of 2.2% over the prior year. Adjusted EBITDA margin* was 21.9%, a decrease of 120 basis points versus the second quarter of 2025.

Previous wording

•Quarterly EPS was $0.22 per diluted share in the first quarter of 2026 and 2025. Adjusted EPS* was $0.24 per diluted share, an increase of 9.1% over the prior year.

Current wording

•Quarterly EPS was $0.30 per diluted share, a 3.4% increase over the prior year EPS of $0.29. Adjusted EPS* was $0.32 per diluted share, an increase of 6.7% over the prior year.

Previous wording

•Operating cash flow was $118.4 million for the quarter, a decrease of 19.4% compared to the prior year. Free cash flow* was $111 million for the quarter, a decrease of 20.6% compared to the prior year. Cash flow was negatively impacted by $39.5 million due to the timing of tax payments associated with our tax credit planning strategy, as well as $8.8 million due to the transition to semi-annual interest payments on our 2035 Senior Notes. The Company invested $18.5 million in acquisitions, $7.1 million in capital expenditures, and paid dividends totaling $87.8 million.

Current wording

•Operating cash flow was $172.5 million for the quarter, a decrease of 1.5% compared to the prior year. Free cash flow* was $166 million for the quarter, a decrease of 1.2% compared to the prior year. Cash flow was negatively impacted due to the timing of tax payments associated with our tax credit planning strategy. The Company invested $116.8 million in acquisitions, $6.4 million in capital expenditures, and paid dividends totaling $88.1 million.

Previous wording

*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.

Current wording

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

Previous wording

Revenues for the quarter ended March 31, 2026 were $906.4 million, an increase of $83.9 million, or 10.2%, from 2025 revenues of $822.5 million. The increase in revenues was driven by demand from our customers across all major service offerings. Organic revenue* growth was 6.6% with acquisitions adding 3.6% in the quarter. Residential pest control revenue increased 9.3%, commercial pest control revenue increased 9.6% and termite and ancillary services grew 13.5% including both organic and acquisition-related growth in each area. Organic revenue* growth was 4.2% in residential, 7.7% in commercial, and 9.8% in termite and ancillary activity. The Company’s foreign operations accounted for approximately 7% of total revenues for the quarters ended March 31, 2026 and March 31, 2025.

Current wording

Revenues for the quarter ended June 30, 2026 were $1.1 billion, an increase of $79.0 million, or 7.9%, from 2025 revenues of $999.5 million. The increase in revenues was driven by demand from our customers across all major service offerings. Organic revenue* growth was 5.7% with acquisitions adding 2.2% in the quarter. Residential pest control revenue increased 6.6%, commercial pest control revenue increased 8.6% and termite and ancillary services grew 10.5% including both organic and acquisition-related growth in each area. Organic revenue* growth was 3.6% in residential, 7.2% in commercial, and 8.9% in termite and ancillary activity. The Company’s foreign operations accounted for approximately 7% of total revenues for the quarters ended June 30, 2026 and June 30, 2025.

Previous wording

Gross profit for the quarter ended March 31, 2026 was $460.9 million, an increase of $38.5 million, or 9.1%, compared to $422.4 million for the quarter ended March 31, 2025.

Current wording

Gross profit for the quarter ended June 30, 2026 was $569.9 million, an increase of $32.3 million, or 6.0%, compared to $537.7 million for the quarter ended June 30, 2025.

Previous wording

For the quarter ended March 31, 2026, sales, general and administrative ("SG&A") expenses were $282.9 million, an increase of $32.4 million, or 12.9%, compared to the quarter ended March 31, 2025.

Current wording

For the quarter ended June 30, 2026, sales, general and administrative ("SG&A") expenses were $335.0 million, an increase of $27.4 million, or 8.9%, compared to the quarter ended June 30, 2025.

Previous wording

As a percentage of revenue, SG&A increased 70 basis points to 31.2% from 30.5% in the prior year, primarily due to 50 basis points of higher selling and marketing costs and 20 basis points of higher insurance and claims costs.

Current wording

As a percentage of revenue, SG&A increased 30 basis points to 31.1% from 30.8% in the prior year, primarily due to 10 basis points of higher selling and marketing costs and 10 basis points of higher fleet expenses associated with higher fuel costs. The remaining increase was driven by other SG&A costs.

Previous wording

For the quarter ended March 31, 2026, depreciation and amortization increased $3.3 million, or 11.3%, compared to the quarter ended March 31, 2025. The increase was due to higher amortization of intangible assets from acquisitions, most notably from the acquisition of Saela.

Current wording

For the quarter ended June 30, 2026, depreciation and amortization increased $1.9 million, or 5.9%, compared to the quarter ended June 30, 2025. The increase was due to higher amortization of intangible assets from acquisitions, most notably from the acquisition of Romex.

Previous wording

For the quarter ended March 31, 2026, operating income increased $2.8 million, or 2.0%, compared to the prior year.

Current wording

For the quarter ended June 30, 2026, operating income increased $3.0 million, or 1.5%, compared to the prior year.

Previous wording

As a percentage of revenue, operating income was 16.1%, a decrease of 120 basis points compared to the first quarter of 2025. Operating margin reduced mostly due to higher insurance and claims costs, higher selling and marketing costs, higher fleet costs, and higher employee expenses.

Current wording

As a percentage of revenue, operating income was 18.7%, a decrease of 110 basis points compared to the second quarter of 2025. Operating margin decreased mostly due to higher employee expenses, higher materials and supplies, higher fleet expenses, and other SG&A expenses.

Previous wording

During the quarter ended March 31, 2026, interest expense, net increased $3.1 million compared to the prior year due to a higher average debt balance associated primarily with the issuance of our 2035 Senior Notes, as well as borrowings under our commercial paper program. We expect interest expense to be approximately $35 million in 2026 associated with borrowings under our 2035 Senior Notes and commercial paper program.

Current wording

During the quarter ended June 30, 2026, interest expense, net increased $2.0 million compared to the prior year primarily due to a higher average debt balance associated with higher borrowings under our commercial paper program.

Previous wording

During the quarter ended March 31, 2026, other (income) expense, net decreased $0.2 million primarily due to lower gains on non-operational asset sales.

Current wording

During the quarter ended June 30, 2026, other (income) expense, net decreased $2.5 million primarily due to higher losses on non-operational asset sales and disposals.

Previous wording

The Company’s effective tax rate was 21.3% in the first quarter of 2026 and 23.5% in the first quarter of 2025. The reduced rate is primarily due to increased benefits from stock-based compensation and the purchase of transferable federal income tax credits during the three months ended March 31, 2026. We expect our effective tax rate to be under 25% in 2026.

Current wording

The Company’s effective tax rate was 24.2% in the second quarter of 2026 and 26.0% in the second quarter of 2025. The reduced rate is primarily due to the purchase of transferable federal income tax credits during the three months ended June 30, 2026.

Previous wording

Gross margin decreased 60 basis points to 50.8% in 2026 compared to 51.4% in 2025. The decrease is primarily due to 30 basis points of higher insurance and claims costs due to a less favorable claims experience, 20 basis points of higher fleet expenses primarily associated with lower vehicle gains, which we expect to moderate in the second quarter, and 20 basis points of higher employee expenses. Fuel costs represent approximately 1.5% of revenues and we expect these costs to remain below 2% for the year.

Current wording

Gross margin decreased to 51.9% in 2026 versus 52.7% in 2025. The decrease is primarily due to 50 basis points of higher employee expenses, including medical costs and service salaries, 20 basis points of higher insurance and claims costs, 20 basis points of higher fleet expenses primarily associated with higher fuel costs, and 10 basis points of higher materials and supplies costs. This was partially offset by lower other expenses.

Previous wording

Adjusted operating income and adjusted operating margin are calculated by adding back to operating income those expenses associated with 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.

Current wording

Adjusted operating income and adjusted operating margin are calculated by adding back to operating income those expenses associated with the amortization of intangible assets and adjustments to the fair value of contingent consideration resulting from the acquisitions of Fox Pest Control, Saela Pest Control and Romex 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.

Previous wording

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.

Current wording

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, Saela Pest Control and Romex 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.

Previous wording

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 associated with 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.

Current wording

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 associated with the adjustments to the fair value of contingent consideration resulting from the acquisitions of Fox Pest Control, Saela Pest Control and Romex 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.

Previous wording

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.

Current wording

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

Previous wording

(1) Consists of expenses resulting from the amortization of intangible assets and adjustments to the fair value of contingent consideration associated with 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.

Current wording

(1) Consists of expenses resulting from the amortization of intangible assets and adjustments to the fair value of contingent consideration associated with the acquisitions of Fox Pest Control, Saela Pest Control and Romex 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.

Previous wording

The Company’s $116.5 million of total cash at March 31, 2026 is held at various banking institutions. As of March 31, 2026, approximately $56.9 million is held in cash by foreign subsidiaries and the remaining $59.6 million is held at domestic banks and also includes cash-in-transit.

Current wording

The Company’s $109.1 million of total cash at June 30, 2026 is held at various banking institutions. As of June 30, 2026, approximately $46.2 million is held in cash by foreign subsidiaries and the remaining $62.9 million is held at domestic banks and also includes cash-in-transit.

Previous wording

In March 2025, we established a commercial paper program under which we may issue unsecured commercial paper up to a total of $1 billion outstanding at any time, with maturities of up to 397 days from the date of issue. Borrowings under this program are generally outstanding for 30 days or less. The net proceeds from the issuance of commercial paper are used for various purposes, including general corporate purposes and funding for acquisitions. As of March 31, 2026 and December 31, 2025, there were $163.9 million and $114.4 million of outstanding borrowings under the commercial paper program, respectively.

Current wording

In March 2025, we established a commercial paper program under which we may issue unsecured commercial paper up to a total of $1 billion outstanding at any time, with maturities of up to 397 days from the date of issue. Borrowings under this program are generally outstanding for 30 days or less. The net proceeds from the issuance of commercial paper are used for various purposes, including general corporate purposes and funding for acquisitions. As of June 30, 2026 and December 31, 2025, there were $215.9 million and $114.4 million of outstanding borrowings under the commercial paper program, respectively.

Previous wording

The following table sets forth a summary of our cash flows from operating, investing and financing activities for the three month periods presented:

Current wording

The following table sets forth a summary of our cash flows from operating, investing and financing activities for the six month periods presented:

Previous wording

Cash from operating activities is the principal source of cash generation for our businesses. The most significant source of cash in our cash flow from operations is customer-related activities, the largest of which is collecting cash resulting from services sold. The most significant operating use of cash is to pay our suppliers, employees, and tax authorities. The Company’s operating activities generated net cash of $118.4 million and $146.9 million for the three months ended March 31, 2026 and 2025, respectively. The $28.5 million, or 19.4%, decrease was driven primarily by the timing of approximately $39.5 million due to the timing of tax payments associated with our tax credit planning strategy, approximately $8.8 million due to the transition to semi-annual interest payments on our 2035 Senior Notes, as well as the the timing of cash receipts and cash payments to and from customers, vendors, and employees. Aside from the timing impacts of our federal income tax and interest, we continued to generate strong operating cash flows. We expect these timing differences to moderate as we go through the year, and we expect cash flow growth to improve in future quarters.

Current wording

Cash from operating activities is the principal source of cash generation for our businesses. The most significant source of cash in our cash flow from operations is customer-related activities, the largest of which is collecting cash resulting from services sold. The most significant operating use of cash is to pay our suppliers, employees, and tax authorities. The Company’s operating activities generated net cash of $290.9 million and $322.0 million for the six months ended June 30, 2026 and 2025, respectively. The $31.1 million, or 9.7%, decrease was driven primarily by an increase of approximately $49.7 million in net income tax payments associated with our tax credit planning strategy as well as the timing of cash receipts and cash payments to and from customers, vendors, and employees. Aside from the timing impact of our federal income tax payments, we continued to generate strong operating cash flows. We expect these timing differences to moderate as we go through the year, resulting in a neutral impact on our full-year operating cash flow growth.

Previous wording

The Company’s investing activities used $24.6 million and $32.6 million for the three months ended March 31, 2026 and 2025, respectively. Cash paid for acquisitions totaled $18.5 million for the three months ended March 31, 2026, compared to $27.2 million for the three months ended March 31, 2025. The Company invested $7.1 million in capital expenditures during the year, offset by $0.6 million in cash proceeds from the sale of assets, compared with $6.8 million of capital expenditures and $1.4 million in cash proceeds from asset sales in 2025. The Company’s investing activities were funded primarily through existing cash balances, operating cash flows, and proceeds from borrowings, including our commercial paper program.

Current wording

The Company’s investing activities used $146.2 million and $263.1 million for the six months ended June 30, 2026 and 2025, respectively. Cash paid for acquisitions totaled $135.3 million for the six months ended June 30, 2026, compared to $253.6 million for the six months ended June 30, 2025. The Company invested $13.6 million in capital expenditures during the six months ended June 30, 2026, offset by $1.1 million in cash proceeds from the sale of assets, compared with $13.9 million of capital expenditures and $3.5 million in cash proceeds from asset sales in 2025. The Company’s investing activities were funded primarily through existing cash balances, operating cash flows, and proceeds from borrowings, including our commercial paper program.

Previous wording

Cash of $76.2 million was used in financing activities during the three months ended March 31, 2026, compared with $4.6 million during the three months ended March 31, 2025. A total of $87.8 million was paid in cash dividends ($0.1825 per share) during the three months ended March 31, 2026, compared to $79.9 million in cash dividends paid ($0.165 per share) during the three months ended March 31, 2025.

Current wording

Cash of $134.7 million was used in financing activities during the six months ended June 30, 2026, compared with $28.6 million during the six months ended June 30, 2025. A total of $175.9 million was paid in cash dividends ($0.3650 per share) during the six months ended June 30, 2026, compared to $159.4 million in cash dividends paid ($0.330 per share) during the six months ended June 30, 2025.

Previous wording

During the three months ended March 31, 2026, the Company received net proceeds of $49.5 million under its commercial paper program compared to net borrowings under its 2035 Senior Notes and Revolving Credit Facility of $95.2 million during 2025.

Current wording

During the six months ended June 30, 2026, the Company received net borrowings of $101.5 million under its commercial paper program compared to net borrowings under its 2035 Senior Notes and Revolving Credit Facility and commercial paper program of $155.2 million during 2025.

Previous wording

During the three months ended March 31, 2026, the Company paid $6.1 million of contingent consideration, compared to $1.2 million during the three months ended March 31, 2025. The Company withheld $22.4 million and $14.7 million of common stock for the three months ended March 31, 2026 and 2025, respectively, in connection with tax withholding obligations of its employees upon vesting of such employees’ equity awards.

Current wording

During the six months ended June 30, 2026, the Company paid $9.5 million of contingent consideration, compared to $3.4 million during the six months ended June 30, 2025. The Company withheld $22.8 million and $14.9 million of common stock for the six months ended June 30, 2026 and 2025, respectively, in connection with tax withholding obligations of its employees upon vesting of such employees’ equity awards.

Previous wording

In 2012, the Company’s Board of Directors authorized the purchase of up to 5 million shares of the Company’s common stock. After adjustments for stock splits, the total authorized shares under the share repurchase plan is 16.9 million shares. As of March 31, 2026, 11.4 million additional shares may be purchased under the share repurchase program.

Current wording

In 2012, the Company’s Board of Directors authorized the purchase of up to 5 million shares of the Company’s common stock. After adjustments for stock splits, the total authorized shares under the share repurchase plan is 16.9 million shares.

Previous wording

The Form S-3 shelf registration statement on file with the SEC registered $1.5 billion of the Company’s common stock, preferred stock, debt securities, depositary shares, warrants, rights, purchase contracts and units for future issuance by the Company. The Company may offer and sell some or all of such securities from time to time or through underwriters, brokers or dealers, directly to one or more other purchasers, through a block trade, through agents on a best-efforts basis, through a combination of any of the above methods of sale or through other types of transactions described in the Form S-3. The Company has not sold any securities in a primary offering as of the date of this Form 10-Q. Management is continually evaluating the Company's financial structure and the potential need or desirability of raising additional liquidity through the sale of debt or equity securities. The Form S-3 will expire in June 2026, and the Company expects to file a new registration statement prior to the expiration date.

Current wording

On April 29, 2026, the Company filed a Form S-3ASR, which was declared effective immediately. The shelf registration statement on file with the SEC registered the Company’s common stock, preferred stock, debt securities, depositary shares, warrants, rights, purchase contracts and units for future issuance by the Company. The Company may offer and sell some or all of such securities from time to time or through underwriters, brokers or dealers, directly to one or more other purchasers, through a block trade, through agents on a best-efforts basis, through a combination of any of the above methods of sale or through other types of transactions described in the Form S-3ASR. The Company has not sold any securities in a primary offering as of the date of this Form 10-Q. Management is continually evaluating the Company's financial structure and the potential need or desirability of raising additional liquidity through the sale of debt or equity securities. The Form S-3ASR will expire in April 2029.

Previous wording

In the normal course of business, the Company and its subsidiaries are involved in, and will continue to be involved in, various claims, arbitrations, contractual disputes, inquiries, investigations, litigation, and tax and other regulatory matters relating to, and arising out of, our businesses and our operations. These matters may involve, but are not limited to, allegations that our services or vehicles caused damage or injury, claims that our services did not achieve the desired results, claims related to acquisitions and allegations by federal, state or local authorities, including taxing authorities, of violations of regulations or statutes. In addition, we are parties to employment-related investigations, cases, and claims from time to time, which may include claims on a representative or class action basis alleging wage and hour law violations, claims filed under California's Private Attorneys General Act, and claims and investigations related to our enforcement of post-employment restrictive covenants. We are also involved from time to time in certain environmental matters primarily arising in the normal course of business. We evaluate pending and threatened claims and establish loss contingency reserves based upon outcomes we currently believe to be probable and reasonably estimable in accordance with ASC 450.

Current wording

In the normal course of business, the Company and its subsidiaries are involved in, and will continue to be involved in, various claims, arbitrations, contractual disputes, inquiries, investigations, litigation, and tax and other regulatory matters relating to, and arising out of, our businesses and our operations. These matters may involve, but are not limited to, allegations that our services or vehicles caused damage or injury, claims that our services did not achieve the desired results, claims related to acquisitions and allegations by federal, state or local authorities, including taxing and pest control regulatory authorities, of violations of regulations or statutes. In addition, we are parties to employment-related investigations, cases, and claims from time to time, which may include claims on a representative or class action basis alleging wage and hour law violations, claims filed under California's Private Attorneys General Act, and claims and investigations related to our enforcement of post-employment restrictive covenants. We are also involved from time to time in certain environmental matters primarily arising in the normal course of business. We evaluate pending and threatened claims and establish loss contingency reserves based upon outcomes we currently believe to be probable and reasonably estimable in accordance with ASC 450.

Previous wording

•the Saela acquisition expanding the Rollins family of brands and driving long-term value;

Current wording

•the Romex and Saela acquisition expanding the Rollins family of brands and driving long-term value;

Previous wording

•our expectation that the timing of tax and interest payments will moderate and cash flow growth will improve in future quarters;

Current wording

•our expectation that the timing of tax payments will moderate and cash flow growth will improve in future quarters;

Previous wording

•our belief that interest expense will be approximately $35 million in 2026 associated with borrowings under our 2035 Senior Notes and commercial paper program;

Current wording

•our belief that interest expense will be approximately $40 million in 2026 associated with borrowings under our 2035 Senior Notes and commercial paper program;

Previous wording

•our approach to capital allocation inclusive of our intent to pay cash dividends to common shareholders;

Current wording

•our approach to capital allocation inclusive of dividends, share repurchases, acquisitions and other investments;

Previous wording

•our belief that no pending or threatened claim, proceeding, litigation, regulatory action or investigation, either alone or in the aggregate, including but not limited to claims filed under California's Private Attorneys General Act will have a material adverse effect on our financial position, results of operations or liquidity;

Current wording

•our belief that no pending or threatened claim, proceeding, litigation, regulatory action or investigation, either alone or in the aggregate, including but not limited to claims filed under California's Private Attorneys General Act will have a material adverse effect on our financial position, results of operations or liquidity; and