APi Group Provides Preliminary Second Quarter 2023 Financial Results

APi Group Corporation (NYSE: APG) (“APi” or the “Company”) today provided preliminary second quarter 2023 results. The Company also provided an update on recent M&A activities. The Company is participating in the CJS Securities “New Ideas” Summer Conference today at 1:40 p.m. ET and may discuss these items while at the conference.

Financial Update

The Company will not be providing actual financial results until its earnings release on August 3, 2023, (details are provided below). In advance of the CJS Securities Conference, the Company is pleased to announce that it expects to deliver a strong second quarter with organic net revenue growth in the high-single-digits, continued gross and adjusted EBITDA margin expansion, and free cash flow conversion improvements versus the prior year. Second quarter 2023 adjusted EBITDA is expected to be at or above the midpoint of the financial guidance provided on May 4, 2023.

Russ Becker, APi’s President and Chief Executive Officer stated: “As we cross the half-way point of 2023, we are pleased with the momentum the business continues to demonstrate. Demand for our services remains robust across the markets we serve, and our leaders continue to execute our value-based pricing strategy. Our ability to consistently deliver strong financial results is a testament to the commitment of our ~28,000 leaders and the benefits of our relentless focus on growing high margin, inspection, service, and monitoring revenue.

Additionally, our free cash flow generation and EBITDA growth gives us confidence in our ability to reduce net leverage to near the top end of our target net leverage range of 2.0x – 2.5x near the end of the year while returning to bolt-on M&A. The team has been hard at work taking a disciplined approach to identifying the most attractive opportunities within our robust M&A pipeline. I’m excited to continue to add new businesses and their leaders to the APi family.”

M&A Activities Update

The Company completed a bolt-on acquisition within the Safety Services segment at the end of the second quarter for total consideration of approximately $35 million. APi expects to complete at least two additional bolt-on acquisitions within the Safety Services segment during the third quarter. The combined net revenue contribution from these three acquisitions is expected to be approximately $35 million annualized in 2024. Each of these transactions is expected to be immediately accretive to the Company’s EBITDA margin.