SEC Comment Letter for ABM INDUSTRIES (ABM) — Mar 1, 2017
ABM INDUSTRIES INC /DE/ (ABM) (CIK 0000771497)
Date: March 1, 2017 · CIK: 0000771497 · Accession: 0000000000-17-006886
AI Filing Summary & Sentiment
Reasoning
Letter
March 1, 2017 Via E -Mail Mr. D. Anthony Scaglione Executive Vice President and Chief Financial Officer ABM Industries Incorporated One Liberty Plaza, 7th Floor New York, NY 10006 Form 8 -K Filed December 14, 2016 File No. 001 -08929
Re: ABM Industries Incorporated Form 10 -K for the f iscal year ended Octo ber 31, 20 16 Filed December 21 , 2016 File No. 00 1-08929
Dear M r. Scaglione:
We have reviewed your filing an d have the following comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure.
Please respond to these comments within ten busine ss days by providing the requested information or advis e us as soon as possible when you will respond. If you do not believe our comments apply to your facts and circumstances, please tell us why in your response.
After reviewing your response to these comments, we may have additional comments.
Form 10 -K for the fiscal year ended October 31, 2016
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Critical Accounting Policies and Estimates, page 41
1. We note from your disclosure on page 47 that as of October 31, 2016, you estimated a range of possible loss contingencies between $0 – 7 million. Please
Mr. D. Anthony Scaglione ABM Industries Incorporated March 1, 2017 Page 2
tell us how you determined this range, in light of the substantial legal settlement entered into on F ebruary 6, 2017.
Note 16. Commitments and Contingencies
Certain Legal Proceedings , page 80
2. With respect to the Augustus case and the Karapetyan case settled on February 6, 2017 please tell us how you considered ASC 450 -20-25-2 in determining that an accrual for loss contingencies was not required as of October 31, 2016. We refer also to your Form s 8-K filed on December 23, 2016 and February 7, 2 017.
Form 8 -K filed December 14, 2016
Exhibit 99.1
Reconciliations of Non -GAAP Financial Measures
3. We note that y our non -GAAP reconciliations begin with non -GAAP measures rather than GAAP measures . It appears that these reconciliations present the non- GAAP measures with greater prominence than GAAP measures . Please tell us the consideration you gave to Question 102.10 of the Compliance and Disclosure Interpretations on Non -GAAP Financial Measures issued on May 17, 2016. Additionally, in future filings provide discussion within your reconciliations of how you calculated the adjustment for income taxes. This comment is also applicable to the non -GAAP reconciliations found in Exhibit 99.2.
4. Please explain what is included in the Self -insurance adjustment and why you believe the exclusion of this amount from income from continuing operations results in a measure that is useful to investors. Provide us with your proposed disclosure to the extent that this adjustment is included in future earnings releases or filings. This comment is also applicable to the non -GAAP reconciliations found in Exhibit 99.2.
Exhibit 99.2
5. We note that you have highlighted Adjusted Income from Continuing Operations and Adjusted EBITDA for the quarter and year ended October 31, 20 16, but not the most comparable GAAP measures. We also note that you have presented actual and projected Adjusted EPS, but not a GAAP -based EPS measure. Please tell us how your disclosure complies with Question 102.10 of the Compliance and Disclosure Int erpretations on Non -GAAP Financial Measures issued on May 17, 2016.
Mr. D. Anthony Scaglione ABM Industries Incorporated March 1, 2017 Page 3
We remind you that the company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the staff.
You may contact Jorge L. Bonilla at (202) 551 -3414 or me at (202) 551 -3429 with any questions .
Sincerely,
/s/ Kristi Marrone
Show Raw Text
Mail Stop 3233
March 1, 2017
Via E -Mail
Mr. D. Anthony Scaglione
Executive Vice President and Chief Financial Officer
ABM Industries Incorporated
One Liberty Plaza, 7th Floor
New York, NY 10006
Re: ABM Industries Incorporated
Form 10 -K for the f iscal year ended Octo ber 31, 20 16
Filed December 21 , 2016
File No. 00 1-08929
Form 8 -K
Filed December 14, 2016
File No. 001 -08929
Dear M r. Scaglione:
We have reviewed your filing an d have the following comments. In some of our
comments, we may ask you to provide us with information so we may better understand
your disclosure.
Please respond to these comments within ten busine ss days by providing the
requested information or advis e us as soon as possible when you will respond. If you do
not believe our comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your response to these comments, we may have additional
comments.
Form 10 -K for the fiscal year ended October 31, 2016
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of
Operations
Critical Accounting Policies and Estimates, page 41
1. We note from your disclosure on page 47 that as of October 31, 2016, you
estimated a range of possible loss contingencies between $0 – 7 million. Please
Mr. D. Anthony Scaglione
ABM Industries Incorporated
March 1, 2017
Page 2
tell us how you determined this range, in light of the substantial legal settlement
entered into on F ebruary 6, 2017.
Note 16. Commitments and Contingencies
Certain Legal Proceedings , page 80
2. With respect to the Augustus case and the Karapetyan case settled on February 6,
2017 please tell us how you considered ASC 450 -20-25-2 in determining that an
accrual for loss contingencies was not required as of October 31, 2016. We refer
also to your Form s 8-K filed on December 23, 2016 and February 7, 2 017.
Form 8 -K filed December 14, 2016
Exhibit 99.1
Reconciliations of Non -GAAP Financial Measures
3. We note that y our non -GAAP reconciliations begin with non -GAAP measures
rather than GAAP measures . It appears that these reconciliations present the non-
GAAP measures with greater prominence than GAAP measures . Please tell us the
consideration you gave to Question 102.10 of the Compliance and Disclosure
Interpretations on Non -GAAP Financial Measures issued on May 17, 2016.
Additionally, in future filings provide discussion within your reconciliations of
how you calculated the adjustment for income taxes. This comment is also
applicable to the non -GAAP reconciliations found in Exhibit 99.2.
4. Please explain what is included in the Self -insurance adjustment and why you
believe the exclusion of this amount from income from continuing operations
results in a measure that is useful to investors. Provide us with your proposed
disclosure to the extent that this adjustment is included in future earnings releases
or filings. This comment is also applicable to the non -GAAP reconciliations
found in Exhibit 99.2.
Exhibit 99.2
5. We note that you have highlighted Adjusted Income from Continuing Operations
and Adjusted EBITDA for the quarter and year ended October 31, 20 16, but not
the most comparable GAAP measures. We also note that you have presented
actual and projected Adjusted EPS, but not a GAAP -based EPS measure. Please
tell us how your disclosure complies with Question 102.10 of the Compliance and
Disclosure Int erpretations on Non -GAAP Financial Measures issued on May 17,
2016.
Mr. D. Anthony Scaglione
ABM Industries Incorporated
March 1, 2017
Page 3
We remind you that the company and its management are responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review, comments,
action or absence of action by the staff.
You may contact Jorge L. Bonilla at (202) 551 -3414 or me at (202) 551 -3429
with any questions .
Sincerely,
/s/ Kristi Marrone
Kristi Marrone
Staff Accountant
Office of Real Estate and
Commodities