UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):		December 12, 2006

ABM Industries Incorporated

(Exact name of registrant as specified in its charter)

Delaware		1-8929		94-1369354
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

160 Pacific Avenue, Suite 222, San Francisco, California		94111
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code		(415) 733-4000

Not Applicable

(Former name or former address if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 2.02 Results of Operations and Financial Condition.

     On December 12, 2006, ABM Industries Incorporated (the “Company”) issued a press release announcing financial results related to fiscal year 2006 and the fourth quarter of fiscal year 2006. A copy of the press release is attached as Exhibit 99.1, which is incorporated into this item by reference.

Item 8.01 Other Events.

     On December 12, 2006, the Board of Directors of the Company declared a quarterly dividend of $0.12 per share, payable on February 5, 2007 to stockholders of record on January 12, 2007. A copy of the press release announcing the declaration of the dividend is attached as Exhibit 99.2, which is incorporated into this item by reference.

     In addition, on December 12, 2006, the Board of Directors of the Company authorized the purchase of up to 2,000,000 shares of the Company’s common stock, which purchases may be made at any time through October 31, 2007. A copy of the press release announcing the authorization of the common stock repurchase is attached as Exhibit 99.3, which is incorporated into this item by reference.

Item 9.01 Financial Statements and Exhibits.

(c)

Exhibits.

99.1

Press Release of ABM Industries Incorporated dated December 12, 2006, announcing financial results related to fiscal year 2006 and the fourth quarter of fiscal year 2006.

99.2

Press Release of ABM Industries Incorporated dated December 12, 2006, announcing the declaration of a dividend.

99.3

Press Release of ABM Industries Incorporated dated December 12, 2006, announcing the authorization of the common stock repurchase.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

EXHIBIT INDEX

99.1

Press Release of ABM Industries Incorporated dated December 12, 2006, announcing financial results related to fiscal year 2006 and the fourth quarter of fiscal year 2006.

99.2

Press Release of ABM Industries Incorporated dated December 12, 2006, announcing the declaration of a dividend.

99.3

Press Release of ABM Industries Incorporated dated December 12, 2006, announcing the authorization of the common stock repurchase.

EXHIBIT 99.1

ABM INDUSTRIES ANNOUNCES FOURTH QUARTER AND FISCAL
YEAR 2006 FINANCIAL RESULTS

Company Achieves Record Fourth Quarter Sales and Other Income of $696.7 million and
Non-GAAP Operating Earnings of $0.37 for the Fourth Quarter

SAN FRANCISCO, CA — December 12, 2006 — ABM Industries Incorporated (NYSE:ABM), a leading facility services contractor in the United States, today reported income from continuing operations for the fourth quarter of fiscal 2006 of $61.6 million ($1.24 per diluted share), compared to $8.5 million ($0.17 per diluted share) for the prior year fourth quarter. As anticipated, results for the fourth quarter and fiscal year include $45.1 million ($0.91 per diluted share) from the settlement of the World Trade Center insurance claims. Sales and other income for the fourth quarter of fiscal 2006 were $696.7 million, up 5.8% from $658.7 million in the fourth quarter of fiscal 2005. When the Company’s income from settlement of the World Trade Center insurance claims and unusual IT expenses are excluded, the Company’s “Operating Earnings,” a non-GAAP financial measure, for the fourth quarter of 2006 were $18.4 million ($0.37 per diluted share) as compared to $8.5 million ($0.17 per diluted share) in the same quarter of 2005.

“We closed a strong year with solid revenue growth in the fourth quarter, improved margins in our Janitorial, Parking, Security and Engineering segments, and cash flow from operations of nearly $100 million due in large part to the successful resolution of our World Trade Center insurance claims,” commented Henrik C. Slipsager, ABM’s president and chief executive officer. “Our focus and execution on key strategic initiatives continues to enhance our competitive position within the facility services industry. As our customers’ requirements change we must respond by expanding our capabilities and enhancing our service platforms. ABM Engineering, which posted another quarter and year of double digit growth top and bottom line, exemplifies our effort to respond to market demands.”

The Company reported income from continuing operations during the year ended October 31, 2006 of $93.2 million ($1.88 per diluted share) on sales and other income of $2.71 billion, compared to $43.6 million ($0.86 per diluted share) on sales and other income of $2.59 billion for last year. The increase in income from continuing operations was primarily due to the $45.1 million for the settlement of World Trade Center insurance claims and $3.6 million higher benefit from the reduction of the Company’s self insurance reserves related to prior years’ insurance claims. These improvements were partially offset by $2.6 million of share-based compensation costs as a result of the adoption of Statement of Financial Accounting Standards (“SFAS”) No. 123R effective November 1, 2005, and $2.0 million charge related to the outsourcing of the Company’s information technology infrastructure and services in October 2006. When the Company’s income from the settlement of World Trade Center insurance claims and unusual IT expenses are excluded, operating earnings for fiscal year 2006 were $50.2 million ($1.01 per diluted share) compared with $42.8 million ($0.85 per diluted share) in fiscal year 2005.

A reconciliation of non-GAAP operating earnings for the fourth quarter and fiscal year ended October 31, 2006 and applicable prior periods is included in the tables below titled: “Reconciliation of ABM’s Operating Earnings with Income from Continuing Operations (GAAP)”

Earnings Guidance

Mr. Slipsager concluded, “In addition to our business success, our financial position remains very strong. We ended the year with $134.0 million in cash and cash equivalents, $312.5 million in working capital and no long term debt. For the first time in ABM’s history, total assets exceeded $1 billion. Given the strength of our balance sheet and our cash flow from continuing operations, we remain well positioned to continue to expand our business through a combination of acquisitions and organic growth. We expect GAAP basis income from continuing operations for fiscal 2007 will be in the range of $1.00 to $1.05 per diluted share. On a non-GAAP basis, we expect operating earnings for 2007 will be in the range of $1.10 to $1.15 per diluted share the difference being our IT outsourcing initiative.”

Conference Call
On Wednesday, December 13, 2006 at 6:00 a.m. (PST), ABM will host a live webcast of remarks by President and Chief Executive Officer Henrik C. Slipsager, and Executive Vice President and Chief Financial Officer George B. Sundby. The webcast will be accessible at www.irconnect.com/primecast/06/q4/abm4q2006.html. Listeners are asked to be online at least fifteen minutes early to register, as well as to download and install any complimentary audio software that might be required. Following the call, the webcast will be available at this URL for a period of three months.

In addition to the webcast, a limited number of toll-free telephone lines will also be available for listeners who are among the first to call 877-440-9648 within fifteen minutes before the event. Telephonic replays will be accessible during the period from two hours to seven days after the call by dialing 800-642-1687, and then entering ID # 3555439.

About ABM Industries ABM Industries Incorporated (NYSE:ABM) is among the largest facility services contractors listed on the New York Stock Exchange. With fiscal 2006 revenues in excess of $2.7 billion and more than 75,000 employees, ABM provides janitorial, parking, security, engineering and lighting services for thousands of commercial, industrial, institutional and retail facilities in hundreds of cities across the United States and British Columbia, Canada. The ABM Family of Services includes ABM Janitorial; Ampco System Parking; ABM Security Services, which includes American Commercial Security Services (ACSS) and Security Services of America (SSA); ABM Facility Services; ABM Engineering; and Amtech Lighting Services.

Cautionary Statement Under the Private Securities Litigation Reform Act of 1995.

Cautionary Statement Under the Private Securities Litigation Reform Act of 1995. This press release contains forward-looking statements that set forth management’s anticipated results based on management’s plans and assumptions. Any number of factors could cause the Company’s actual results to differ materially from those anticipated. These risks and uncertainties include, but are not limited to: ; (1) a change in the frequency or severity of claims against the Company, a deterioration in claims management, the cancellation or non-renewal of the Company’s primary insurance policies or a change in our customers’ insurance needs; (2) a change in actuarial analysis that causes an unanticipated change in insurance reserves; (3) inadequate technology systems that cannot support the growth of the business; (4) acquisition activity slows or is unsuccessful; (5) labor disputes that lead to a loss of sales or expense variations; ; (6) a decline in commercial office building occupancy and rental rates lowers sales and profitability; ; (7) financial difficulties or bankruptcy of a major customer; (8) the loss of long-term

customers; (9) intense competition that lowers revenue or reduces margins; (10) an increase in costs that the Company cannot pass on to customers; (11) natural disasters or acts of terrorism that disrupt the Company in providing services; (12) significant accounting and other control costs that reduce the Company’s profitability; and (13) other issues and uncertainties that may include: new accounting pronouncements or changes in accounting policies, labor shortages that adversely affect the Company’s ability to employ entry level personnel ,low levels of capital investments by customers, which tend to be cyclical in nature, that adversely impact the results of the Company’s Lighting segment, legislation or other governmental action that detrimentally impacts the Company’s expenses or reduces sales by adversely affecting the Company’s customers, unanticipated adverse jury determinations, judicial rulings or other developments in litigation to which the Company is subject, a reduction or revocation of the Company’s line of credit that increases interest expense and the cost of capital, and the resignation, termination, death or disability of one or more of the Company’s key executives that adversely affects customer retention or day-to-day management of the Company. Additional information regarding these and other risks and uncertainties the Company faces is contained in the Company’s Annual Report on Form 10-K and in other reports it files from time to time with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise.

Use of Non-GAAP Financial Information
To supplement ABM’s consolidated condensed financial statements presented on a GAAP basis, ABM uses operating earnings, a non-GAAP measure of income from continuing operations that excludes certain costs, expenses, gains or losses. These adjustments to ABM’s GAAP income from continuing operations are made with the intent of providing both management and investors a better understanding of the underlying operational results and trends and ABM’s marketplace performance. In addition, this non-GAAP measure is among the primary indicators management uses as a basis for planning and forecasting future periods. The presentation of this additional measure, in the aggregate and on a per-share basis, is not meant to be considered in isolation or as a substitute for measures of net income prepared in accordance with generally accepted accounting principles in the United States.

Financial Schedules
GAAP Basis
(In thousands, except per share data)

BALANCE SHEET SUMMARY

		October 31,				October 31,
		2006				2005
Assets
Cash and cash equivalents		$	134,001			$	56,793
Trade accounts receivable, net			383,977				345,104
Other current assets			113,763				119,556
Total current assets			631,741				521,453
Goodwill			247,888				243,559
Other intangibles, net			23,881				24,463
All other assets			112,764				114,235
Total assets		$	1,016,274			$	903,710
Liabilities
Current liabilities		$	319,285			$	275,074
Non-current liabilities			155,742				152,710
Total liabilities			475,027				427,784
Stockholders’ Equity			541,247				475,926
Total liabilities and stockholders’ equity		$	1,016,274			$	903,710

SELECTED CASH FLOW INFORMATION

		Three Months Ended October 31,
		2006				2005
		(UNAUDITED)
Net cash flows from continuing operating activities		$	97,811			$	37,309
Net operational cash flows from discontinued operations			—				(7,720	)
Net Cash Provided By Operating Activities		$	97,811			$	29,589
Net Cash Used In Investing Activities		$	(2,744	)		$	(7,601	)
Common stock issued		$	4,781			$	3,750
Stock buyback			(12,019	)			—
Dividends paid			(5,368	)			(5,147	)
Net Cash Used In Financing Activities		$	(12,606	)		$	(1,397	)

		Year Ended October 31,
		2006				2005
Net cash flows from continuing operating activities		$	130,367			$	44,799
Net operational cash flows from discontinued operations			—				(7,348	)
Net Cash Provided By Operating Activities		$	130,367			$	37,451
Net Cash Used In Investing Activities		$	(21,814	)		$	(13,102	)
Common stock issued		$	16,193			$	21,137
Stock buyback			(25,961	)			(31,318	)
Dividends paid			(21,577	)			(20,744	)
Net Cash Used In Financing Activities		$	(31,345	)		$	(30,925	)

INCOME STATEMENT

		Three Months Ended October 31,								Increase
		2006				2005				(Decrease)
		(UNAUDITED)
Revenues
Sales and other income		$	696,684			$	658,706				5.8	%
Gain on insurance claim			80,000				—				—
Total revenues			776,684				658,706				17.9	%
Expenses
Operating expenses and cost of goods sold			610,620				581,645				5.0	%
Selling, general and administrative expenses			56,265				61,276				(8.2	)%
Intangible amortization			1,336				1,409				(5.2	)%
Interest expense			129				171				(24.6	)%
Total expenses			668,350				644,501				3.7	%
Income from continuing operations before income taxes			108,334				14,205				—
Income taxes			46,763				5,711				—
Income from continuing operations			61,571				8,494				—
Income (loss) from discontinued operations, net of income taxes			—				(67	)			—
Gain on sale of discontinued operation, net of income taxes			—				—				—
Net Income		$	61,571			$	8,427				—
Net Income Per Common Share — Basic
Income from continuing operations		$	1.26			$	0.17				—
Income from discontinued operations			—				—				—
Gain on sale of discontinued operation			—				—				—
		$	1.26			$	0.17				—
Net Income Per Common Share — Diluted
Income from continuing operations		$	1.24			$	0.17				—
Income from discontinued operations			—				—				—
Gain on sale of discontinued operation			—				—				—
		$	1.24			$	0.17				—
Average Common And Common Equivalent Shares
Basic			48,959				48,922				0.1	%
Diluted			49,507				49,901				(0.8	)%

		Year Ended October 31,								Increase
		2006				2005				(Decrease)
Revenues
Sales and other income		$	2,712,668			$	2,586,566				4.9	%
Gain on insurance claim			80,000				1,195				—
Total revenues			2,792,668				2,587,761				7.9	%
Expenses
Operating expenses and cost of goods sold			2,421,552				2,312,687				4.7	%
Selling, general and administrative expenses			207,116				204,131				1.5	%
Intangible amortization			5,764				5,673				1.6	%
Interest expense			495				884				(44.0	)%
Total expenses			2,634,927				2,523,375				4.4	%
Income from continuing operations before income taxes			157,741				64,386				—
Income taxes			64,536				20,832				—
Income from continuing operations			93,205				43,554				—
Income from discontinued operations, net of income taxes			—				166				—
Gain on sale of discontinued operation, net of income taxes			—				14,221				—
Net Income		$	93,205			$	57,941				—
Net Income Per Common Share — Basic
Income from continuing operations		$	1.90			$	0.88				—
Income from discontinued operations			—				—				—
Gain on sale of discontinued operation			—				0.29				—
		$	1.90			$	1.17				—
Net Income Per Common Share — Diluted
Income from continuing operations		$	1.88			$	0.86				—
Income from discontinued operations			—				—				—
Gain on sale of discontinued operation			—				0.29				—
		$	1.88			$	1.15				—
Average Common And Common Equivalent Shares
Basic			49,054				49,332				(0.6	)%
Diluted			49,678				50,367				(1.4	)%

SALES AND OPERATING PROFIT BY SEGMENT

		Three Months Ended October 31,								Increase
		2006				2005				(Decrease)
		(UNAUDITED)
Sales and Other Income
Janitorial		$	398,926			$	383,604				4.0	%
Parking			112,530				106,813				5.4	%
Security			76,873				73,834				4.1	%
Engineering			78,536				62,737				25.2	%
Lighting			28,773				31,138				(7.6	)%
Corporate			1,046				580				80.3	%
		$	696,684			$	658,706				5.8	%
Operating Profit
Janitorial		$	22,792			$	19,959				14.2	%
Parking			4,456				1,612				176.4	%
Security			1,887				1,233				53.0	%
Engineering			5,336				3,873				37.8	%
Lighting			675				1,384				(51.2	)%
Corporate expenses			(6,683	)			(13,685	)			(51.2	)%
Operating profit from continuing operations			28,463				14,376				98.0	%
Gain on insurance claim			80,000				—				—
Interest expense			(129	)			(171	)			(24.6	)%
Income from continuing operations before income taxes		$	108,334			$	14,205				—

		Year Ended October 31,								Increase
		2006				2005				(Decrease)
Sales and Other Income
Janitorial		$	1,563,756			$	1,525,565				2.5	%
Parking			440,033				409,886				7.4	%
Security			307,851				294,299				4.6	%
Engineering			285,241				238,794				19.5	%
Lighting			113,014				116,218				(2.8	)%
Corporate			2,773				1,804				53.7	%
		$	2,712,668			$	2,586,566				4.9	%
Operating Profit
Janitorial		$	81,578			$	67,754				20.4	%
Parking			13,658				10,527				29.7	%
Security			4,329				3,089				40.1	%
Engineering			16,736				14,200				17.9	%
Lighting			1,375				3,805				(63.9	)%
Corporate expenses			(39,440	)			(35,300	)			11.7	%
Operating profit from continuing operations			78,236				64,075				22.1	%
Gain on insurance claim			80,000				1,195				—
Interest expense			(495	)			(884	)			(44.0	)%
Income from continuing operations before income taxes		$	157,741			$	64,386				—

Reconciliation of ABM’s Operating Earnings with Income from Continuing Operations (GAAP)

(In thousands, except per share data)
Reconciliation of Consolidated GAAP to Consolidated Non-GAAP
Quarters ended October 31, 2006 & 2005

		4th Quarter 2006												4th Quarter 2005
		Pretax				After-tax				Per Share				Pretax				After-tax				Per Share
Income from Continuing Operations		$	108,334			$	61,571			$	1.24			$	14,205			$	8,494			$	0.17
Adjustments
WTC Settlement			(80,000	)			(45,058	)			(0.91	)			—				—				—
IT Outsourcing Initiatives			3,128				1,907				0.04				—				—				—
Operating Earnings		$	31,462			$	18,420			$	0.37			$	14,205			$	8,494			$	0.17

Reconciliation of Consolidated GAAP to Consolidated Non-GAAP
Years ended October 31, 2006 & 2005

		Fiscal Year 2006												Fiscal Year 2005
		Pretax				After-tax				Per Share				Pretax				After-tax				Per Share
Income from Continuing Operations		$	157,741			$	93,205			$	1.88			$	64,386			$	43,554			$	0.86
Adjustments
WTC Settlement			(80,000	)			(45,058	)		$	(0.91	)			(1,195	)			(730	)			(0.01	)
IT Outsourcing Initiatives			3,338				2,035			$	0.04				—				—				—
Operating Earnings		$	81,079			$	50,182			$	1.01			$	63,191			$	42,824			$	0.85

Reconciliation of Consolidated GAAP to Consolidated Non-GAAP
Earnings Guidance for 2007

		Fiscal Year 2007												Fiscal Year 2006
		Pretax				After-tax				Per Share				Pretax				After-tax				Per Share
Income from Continuing Operations
2006 Actual														$	157,741			$	93,205			$	1.88
2007 High Estimate		$	84,000			$	51,500			$	1.05
2007 Low Estimate		$	80,000			$	49,000			$	1.00
Adjustments
WTC Settlement			—				—				—				(80,000	)			(45,058	)			(0.91	)
IT Outsourcing Initiatives			8,000				5,000				0.10				3,338				2,035				0.04
Total adjustments		$	8,000			$	5,000			$	0.10			$	(76,662	)		$	(43,023	)		$	(0.87	)
2006 Operating Earnings														$	81,079			$	50,182			$	1.01
Operating Earnings - 2007 High Estimate		$	92,000			$	56,500			$	1.15
Operating Earnings - 2007 Low Estimate		$	88,000			$	54,000			$	1.10

ABM Industries Incorporated
George B. Sundby
Executive Vice President and
Chief Financial Officer
(415) 733-4000

EXHIBIT 99.2

CONTACT:

ABM Industries Incorporated
George B. Sundby
Executive Vice President and Chief Financial Officer
(415) 733-4000

ABM INDUSTRIES RAISES QUARTERLY DIVIDEND 9.1%

SAN FRANCISCO — December 12, 2006 — The Board of Directors of ABM Industries Incorporated (NYSE: ABM) has declared an all-time-high first quarter cash dividend of $0.12 per common share payable on February 5, 2007 to stockholders of record on January 12, 2007. This will be ABM’s 163^rd consecutive quarterly cash dividend, and is $0.01 (9.1%) above the $0.11 per share quarterly dividend rate declared and paid for the first quarter of 2006.

About ABM Industries

     ABM Industries Incorporated (NYSE:ABM) is among the largest facility services contractors listed on the New York Stock Exchange. With fiscal 2006 revenues in excess of $2.7 billion and more than 75,000 employees, ABM provides janitorial, parking, security, engineering and lighting services for thousands of commercial, industrial, institutional and retail facilities in hundreds of cities across the United States and British Columbia, Canada. The ABM Family of Services includes ABM Janitorial; Ampco System Parking; ABM Security Services, which includes American Commercial Security Services (ACSS) and Security Services of America (SSA); ABM Facility Services; ABM Engineering; and Amtech Lighting Services.

# # #

EXHIBIT 99.3

ABM INDUSTRIES INCORPORATED AUTHORIZES BUYBACK OF UP TO
TWO MILLION SHARES OF COMPANY STOCK

SAN FRANCISCO — December 12, 2006 — The Board of Directors of ABM Industries Incorporated (NYSE:ABM) authorized the repurchase of up to two million shares of ABM’s outstanding common stock at any time through October 31, 2006. The authorized purchases would at most approximate four percent of the 48.7 million shares of ABM common stock outstanding on November 30, 2006. The Company’s stock closed today at $20.95.

     Purchases would be made from time-to-time through brokers and dealers on the New York Stock Exchange or in privately negotiated transactions with nonaffiliated stockholders. The Company stated that the Board of Directors considers such purchases to be a prudent investment by the Company.

About ABM Industries

     ABM Industries Incorporated (NYSE:ABM) is among the largest facility services contractors listed on the New York Stock Exchange. With fiscal 2006 revenues in excess of $2.7 billion and more than 75,000 employees, ABM provides janitorial, parking, security, engineering and lighting services for thousands of commercial, industrial, institutional and retail facilities in hundreds of cities across the United States and British Columbia, Canada. The ABM Family of Services includes ABM Janitorial; Ampco System Parking; ABM Security Services, which includes American Commercial Security Services (ACSS) and Security Services of America (SSA); ABM Facility Services; ABM Engineering; and Amtech Lighting Services.

# # #

CONTACT:

ABM Industries Incorporated
George B. Sundby (Executive Vice President and Chief Financial Officer)
(415) 733-4000