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BrightView Holdings, Inc. (NYSE: BV) 4 th Quarter Fiscal 2019 Results Investor Presentation

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Page 1: BrightView Holdings, Inc. (NYSE: BV)s22.q4cdn.com/142468460/files/doc_presentations/...product shortages and the loss of key suppliers; our ability to accurately estimate costs of

BrightView Holdings, Inc.

(NYSE: BV)

4th Quarter Fiscal 2019 Results

Investor Presentation

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Investor Presentation | 2

This presentation contains forward looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this presentation, including statements regarding our financial outlook, industry, strategy, future operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management, are forward-looking statements. The words “outlook,” “guidance,” “believes,” “expects,” “may,” “will,” “should,” “seeks,” “intends,” “plans,” “estimates,” or “anticipates,” or similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. By their nature, forward-looking statements: speak only as of the date they are made; are not statements of historical fact or guarantees of future performance; and are subject to risks, uncertainties, assumptions, or changes in circumstances that are difficult to predict or quantify. Our expectations, beliefs, and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that management’s expectations, beliefs and projections will result or be achieved and actual results may vary materially from what is expressed in or indicated by the forward-looking statements. The forward-looking statements contained in this presentation reflect our current views with respect to future events, and we assume no obligation to update any forward-looking statements.

Factors that could cause actual results to differ materially from those projected include, but are not limited to the following: general economic and financial conditions; competitive industry pressures; the failure to retain certain current customers, renew existing customer contracts and obtain new customer contracts; a determination by customers to reduce their outsourcing or use of preferred vendors; the dispersed nature of our operating structure; our ability to implement our business strategies and achieve our growth objectives; acquisition and integration risks; the seasonal nature of our landscape maintenance services; our dependence on weather conditions; increases in prices for raw materials and fuel; product shortages and the loss of key suppliers; our ability to accurately estimate costs of a contract; the conditions and periodic fluctuations of real estate markets, including residential and commercial construction; our ability to retain our executive management and other key personnel; our ability to attract and retain trained workers and third-party contractors and re-employ seasonal workers; any failure to properly verify employment eligibility of our employees; subcontractors taking actions that harm our business; our recognition of future impairment charges; laws and governmental regulations, including those relating to employees, wage and hour, immigration, human health and safety and transportation; environmental, health and safety laws and regulations; the distraction and impact caused by litigation, of adverse litigation judgments or settlements resulting from legal proceedings; increase in on-job accidents involving employees; any failure, inadequacy, interruption, security failure or breach of our information technology systems; any failure to protect the security of personal information about our customers, employees and third parties; our ability to adequately protect our intellectual property; occurrence of natural disasters, terrorist attacks or other external events; our ability to generate sufficient cash flow to satisfy our significant debt service obligations; our ability to obtain additional financing to fund future working capital, capital expenditures, investments or acquisitions, or other general corporate requirements; restrictions imposed by our debt agreements that limit our flexibility in operating our business; increases in interest rates increasing the cost of servicing our substantial indebtedness; and counterparty creditworthiness risk or risk of non-performance with respect to derivative financial instruments.

Additional factors that could cause our results to differ materially from those described in the forward-looking statements can be found under “Item 1A. Risk Factors” in our Form 10-K for the fiscal year ended September 30, 2019 as such factors may be updated from time to time in our periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov.

This presentation also contains non-GAAP financial measures, as defined in Regulation G and adopted by the SEC. We provide reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measure within this presentation and in our Form 8-K announcing our quarterly earnings, which can be found on the SEC’s website at www.sec.gov and our website at www.brightview.com. We are not providing a quantitative reconciliation of our outlook to the corresponding GAAP information because it is not possible to predict with a reasonable degree of certainty the actual impact of certain items that would be included in GAAP results.

Disclaimer

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Company Overview

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Investor Presentation | 4

70+ Years of Best-in-Class Service

• Founded in 1939 by Theodore Brickman

• Primarily landscape maintenance and snow

removal services

• Strong national presence

• Founded in 1949 by Burton Sperber

• Provider of landscape maintenance and

development services

• Strong evergreen market presence

Founded in 2014

Industry-Defining,

Route-Based

Services

Company

Strong Local

Market Presence

and Brand

Reputation

Large, Highly-

Fragmented and

Stable

Addressable

Market

Consolidation

Strategy

Leveraging

Resources and

Scale

Operational

Improvements

Driving Strong

Margins

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Investor Presentation | 5

Providing Holistic Solutions Across the Full Spectrum of Services

Landscape Maintenance Landscape Development

FY’19

Revenue

$2.40B

Revenues: $1.8 Billion

75% of Revenues

Revenues: $0.6 Billion

25% of Revenues

Business

Overview &

Highlights

• Commercial landscaping and snow removal services

• Need-based, essential services business

• Landscape architecture and development

services for new landscapes / large-scale

redesign projects

• Expands BrightView’s customer base

• Horticultural thought-leadership

• Complex and high-profile projects

• Many contracts include ongoing maintenance

upon project completion

Selected

Services Landscape

Services

Snow

Services

Tree Care

Services

Sweep

Services Irrigation Fertilization

Disaster

Recovery

Landscape

Architecture

Nursery &

Tree Moving Pool & Water Sports Fields

Selected

Customers

Commercial Landscaping

• Non-discretionary service

• Predictable recurring revenue

model

• Broad offering of ancillary

services

Snow Removal

• Counter-seasonal revenue stream

• Utilizes existing infrastructure

• Year-to-year variability,

modulated around 30-year avg.

snowfall rates

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Investor Presentation | 6

Leveraging Breadth of Coverage to Serve Customers Across the Country

#1 Player in a ~$70B Market

~10xNext Largest Competitor

Strong Margins and Free Cash Flow

~27% annual FCF growth over last three years

Modest Capex Needs~2.5%-3.0% of Revenue

Robust M&A Pipeline16 companies and more than

$260 million in revenue acquired since 1/1/17

National Footprint

States with BrightView Branches

Extended Coverage via Qualified Service Partners

Maintenance Location

Development Location

Key Statistics

by Region

Branches Employees

Evergreen ~65% ~75%

Seasonal ~35% ~25%

Total > 220 ~ 21,500

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Investor Presentation | 7

Capitalizing on Scale Advantages at both the National and Local Levels

National Scale Advantages

Local Market Scale Advantages

Investments in landscaping-related technologies

Customized leadership and skills-based training

across all levels of the company

Purchasing power on equipment and materials

Differentiated talent acquisition from leading

academic institutions

E-Verified, legal-to-work team members in all markets

Industry-leading safety practices shared across all

regions, driving performance

Network of service providers to support large,

multi-site national networks

National response to local emergencies

Local leaders with local teams engaged in

their communities and peer networks

Often the only local “one-stop” provider of

all landscaping services

Greater route density, reducing travel times

and improving customer response times

Multiple local branches provide back-ups for

critical, time-sensitive customer needs

Key Supplier Relationships

Investments in Technology

Training & Professional Development

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Investor Presentation | 8

• Nation’s largest user of zero-emission equipment

• Millions of tons of carbon consumed by BrightView trees

• Leaders in water conservation technology

• Experts in xeriscaping and native plant design

ESG: Protecting the World We Share

• Support for historic, military, civic, educational and family organizations nationwide

• Lowest employee injury rate in commercial landscaping

• 6,300 man hours daily devoted to employee safety

• Established GROW, an internal advocacy program for women

• Safeguard the investment of BrightView stockholders

• Setting the highest ethical standard

• Team members certified on comprehensive Code of Conduct

• Board of Directors and leadership diversity is a priority

For more, visit: investor.brightview.com/esg

ENVIRONMENTALSUSTAINABILITY

CORPORATEGOVERNANCE

SOCIALRESPONSIBILITY

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Investor Presentation | 9

Tom Donnelly

President, Landscape Development

Brian Bruce

EVP, Chief Information Officer

Todd Chambers

EVP, Chief Marketing Officer

Jonathan Gottsegen

EVP, Chief Legal Officer

Amanda Orders

EVP, Chief Human Resources Officer

Proven Management and Experienced Local Leadership Teams

Andrew Masterman

President and Chief Executive Officer

John Feenan

EVP, Chief Financial Officer

Jeff Herold

COO & President Seasonal Markets, Landscape Maintenance

Michael Dozier

President Evergreen East, Landscape Maintenance

Ed Marcil

President Evergreen West, Landscape Maintenance

Senior Leadership Team

Position Number of EmployeesAvg. BrightView Tenure

(yrs.)¹

Senior Vice President 13 17

Vice President / General Manager 100 12

Branch Manager 231 12

Account Manager / Business Developer 895 7

Local Leadership Team

1 As of 9/30/19 and including tenure with companies acquired by BrightView.

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Investor Presentation | 10

Duke University

Durham, NC

Colonial Williamsburg

Williamsburg, VA

Consistently Executing Across Complex Engagements

ExxonMobil Headquarters

Spring, TX

Getty Museum

Los Angeles, CAFour Seasons Hualalai

Kona, HI

Ritz Carlton

Key Biscayne, FL

Marlins Park

Miami, FL

Beacon Park

Irvine, CA

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Growth Drivers

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Investor Presentation | 12

Sustainable Revenue Growth Levers

Dedicated, Locally-

based Salesforce to

Generate New Sales

Accretive Acquisitions

with Strong-on-Strong

M&A Strategy

Multi-Channel

Approach to Expand

Customer Base

Investing in 180+ person

business development team

solely focused on securing

new customers

Expanding footprint in

high-growth geographies

that exhibit favorable weather

and economic characteristics

Outgrowing regional

competitors through

targeted segmentation to

take market share

21 3

2.6% Market Share

CA

CA

TXFL

NCVA

GA

AZ

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Investor Presentation | 13

Strong-on-Strong Acquisition Strategy & Robust Pipeline Support Future Growth

$260M+Annualized revenue

2017 to 2019

2017

2018

2019

Anaheim, CA

Vista, CA

Sanford, FL

Dallas, TX

Danville, CA

Bay Area, CA

Austin, TX

South Florida

Phoenix, AZ

Hartford, CTTucson, AZ

Shamong, NJPortland, OR

Syracuse, NY

Mesa, AZ

San Diego, CA

2020

1Aquisitions realized in 2020 for the fiscal year-to-date as of 11/21/19.

1

Strategic Objectives

Increase Density

Develop Underpenetrated Geographies

Expand Landscape Enhancement Business

Improve Technical Capabilities

The Leading Acquirer in the Commercial Landscaping Industry

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Investor Presentation | 14

Center of Excellence Initiatives

Streamline/

Centralize

Procurement

Invest in Executive/

Branch-Level Talent

Leverage

Technology

Standardize

Quality

Optimize Asset and

Resource Mgmt.

Driving Operational Efficiencies to Support Enhanced Customer Service

$

Intense

Customer Focus

Strong

LeadersNot Accepting

Mediocrity

Ready, Trained,

Safe and Enabled

Crews

Superior

Financial

Performance

Consistency in

Quality,

Service and

Productivity

Culture of

accountabilityLeadership training and

development programs

Locally-led and empowered organization

Field Marketing driven

by Client segmentation

Strong-on-Strong

M&A Strategy

Salesforce

CRM

Estimating

& Production

Planning

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Industry Overview

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Investor Presentation | 16

~10x

The Size of Next

Largest Direct

Competitor

Industry Leader

Across a Number of

Service Lines

Differentiated Scale

in a Highly-

Fragmented Market Serves 4 of the 5

Largest U.S. Banks4

Contracts with 4 of the 5

Largest U.S. Companies5

Serves 9 of the Top 10 3rd Party

Hotel Management Firms

Serves 11 of the Top 15

Health Systems

Scope to Service a

Diverse Set of End

Markets ~13,000 Office Buildings /

Corporate Campuses

9,000 Residential

Communities

~3,400 Shopping

Environments

450+ Education

Institutions

High-Profile

Bespoke

Assignments Turf Restoration for

the National Mall

Official Field Consultant

for Major League Baseball

Renovated Independence

National Historical Park

Designed / Built Field for

3 Olympic Games

Maintenance for Colonial

Williamsburg

1 Per Lawn and Landscape magazine and company press releases, based on 2018 revenue. Excludes tree care focused companies. 2 Per Snow Magazine. 3 Per Management estimates. 4 Ranking based on total publicly reported assets. 5 Per Forbes, based on total revenues.

#1 Commercial Landscaping Services Provider

#1 Commercial

Landscaper in the U.S.

#1 Snow Removal

Company in the U.S.2Leading

Tree Nursery3

Leading Provider of Golf

Course Maintenance3

Leading Water Irrigation

Service Provider3

Top 10 North American Landscaping Companies1

~10x

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Investor Presentation | 17

Large, Growing and Highly-Fragmented Commercial Landscaping Industry

1 Landscaping services in the U.S. (August 2019), IBISWorld – Snowplowing Services in the U.S. (December 2018) presents

commercial landscaping services and commercial snowplowing services as a share of the overall U.S. market at rates consistent

with IBISWorld figures for 2018.

• Stable growth due to non-discretionary nature of service

• Resilient revenue from focus on industry’s Top Quartile

• BrightView is the only company with >1% market share

• Growth supported by outsourcing and procurement

centralization trends

• Quality demands drive engagement complexity and

criticality of execution

~$70BU.S. Commercial

Landscaping and Snow

BrightView: ~$1.80B

Market Share: 2.6%

~$55BU.S. Commercial

Landscaping

Services

Market Opportunity

Commercial Landscaping and Snow Removal Services Industry

$46 $48 $47 $44 $45 $46 $50 $53

$60 $62 $65 $68 $70 $70 $71 $72 $73 $74

'06A '07A '08A '09A '10A '11A '12A '13A '14A '15A '16A '17A '18E '19E '20E '21E '22E '23E

CAGR: 0%

$ Billion1

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Investor Presentation | 18

High Retention, Limited Concentration & Low Relative Cost of Service

$5.57 $5.32

$2.14 $2.15 $1.68

$0.58 $0.24

Fixed Taxes Utilities R&M Cleaning Parking Grounds

Recurring

Maintenance

Services

Anchor business that provides

predictable recurring revenue and

high degree of visibility on future

performance (75% of FY2019 revenue)

Evergreen

Sites

Significant presence in evergreen

regions, which require year-round

maintenance

Limited

Customer Concentration¹

7%

93%

Top 10

Customers

All Other

Customers

1 Reflects BrightView’s customer concentration based upon FY2019 revenue contribution.2 Other includes: Hospitality, Hospitals, Education, Public Spaces and Other sectors.3 Building Owners and Managers Association International estimate of 2018 average operating expenses per square foot.

Private Sector Office Building Expenses ($/sq.ft.)3

Stability of Business Model Amplified by Relative Low Cost of Landscaping Services

Nature

of Services…

No Customer >2%

40%

26%

34%

Other 2

HOA Corporate

Diversified

Customer Base1

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Investor Presentation | 19

Snow Services Support Counter-Seasonal Revenue and Employee Retention

Efficient utilization of existing assets

High value-add to customers (combination with landscape)

Balanced mix of fixed price contracts with guaranteed minimums

(reduce year-to-year volatility) and upside from pay-per-plow contracts

Additional tool for employee retention given year-round demand

U.S. Snowfall Amounts Modulate Around 10- and 30-Year Averages¹

1 Reflects cumulative annual snowfall at locations where BrightView has a presence.

Inherent Benefits of Snow Services Offering

Avg. Inches as of 9/30/19

10-Year 2,999”

30-Year 2,775”

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Financial Highlights

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Investor Presentation | 21

Full Year 2020 Assumptions

Revenue: expect 1% to 3% growth in Underlying Landscape Maintenance and

1% to 2% growth in Development revenue

Acquisitions: expect contribution of approximately $60 million to fiscal 2020 revenue

Adj. EBITDA Margin: expect 10 to 30 basis points higher versus full year fiscal 2019

Net Debt / Adj. EBITDA ratio: expect to be at or below 3.5x by fiscal year end 2020

FY2020 Financial Guidance1

Total Revenue Adjusted EBITDA Net Capital Expenditures

$2,465M - $2,525MPredictable Drivers

$312M - $320MProfitable Growth

~2.5%-3.0% of RevenueLong-Term Average

Cash Generation Combined with Modest Capital Needs Drives Stockholder Value

1Our financial guidance, which was updated on 11/21/19, contains forward-looking statements and is subject to risks and uncertainties.

See “Introductory Information”.

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Investor Presentation | 22

Full Year 2019 Results

(Numbers $M) Revenue Adjusted EBITDA

2019 2018 2019 2018

Total BrightView $2,404.6 $2,353.6 $305.1 $300.1

Maintenance Services $1,813.4 $1,774.8 $282.0 $289.8

Development Services $595.4 $583.3 $81.7 $78.7

Corporate Expenses - - ($58.6) ($68.4)

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Investor Presentation | 23

Growing at Nearly Double Industry Pace

IBIS estimates4 that the US Commercial Landscape and Snow Removal Industry will grow 2.2% from 2016 through 2020.

2020 Guidance assumes a return to long-term averages in both snow removal services revenue as well as precipitation levels.

Figures in $ millions Guidance Range

1CAGR is calculated from 2016 to the top of the 2020 Guidance range.22016 reflects reported Calendar Year results. 32017 figures are derived from reported unaudited quarterly results.4IBISWorld—Landscaping Services in the U.S. (December 2018), IBISWorld—Snowplowing Services in the U.S. (December 2018)

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Investor Presentation | 24

Healthy Long-Term Adj. EBITDA Growth

1CAGR is calculated from 2016 to the top of the 2020 Guidance range.22016 reflects reported Calendar Year results. 32017 figures are derived from reported unaudited quarterly results.

Figures in $ millions Guidance Range

By driving operational efficiencies and leveraging fixed costs, Adjusted EBITDA growth has out-paced Total Revenue growth.

2020 Guidance assumes a return to long-term averages in both snow removal services revenues and precipitation levels.

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Investor Presentation | 25

Capital Expenditures and Allocation

1 Net capital expenditures excludes the acquisition of legacy ValleyCrest land and buildings for $21.6mm in 1Q18 and is net of proceeds from sale of property & equipment. 2 Net Debt includes total long-term debt, net of original issue discount, and capital lease obligations net of cash and equivalents

Net CapEx / Total Revenue:

2.2% at FY18 vs. 3.5% at FY19

Expect to be 2.5% to 3.0%

in 2020

Annualized Revenue Acquired

$117.6 million in FY 2018

$83.1 million in FY 2019

Net Debt / Adjusted EBITDA

3.8x at FYE18 vs. 3.7x at FYE19

Expect to be at or below 3.5x

by FYE 2020

Capital

Expenditures

M&A

Cash Deployed Net Debt

$1,149.2

$1,131.1

Sep. 30, '18 Sep. 30, '19

2

$52.8

$83.1

$21.6

$12.0 $6.8

FY18 FY19

1

1

Asset Disposals

Legacy

Assets

Generating Cash to Continue M&A and Reduce Debt

Net

Capex

Net

Capex

$86.4$89.9

$104.4

$64.0

FY18 FY19

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Investor Presentation | 26

Substantial Free Cash Flow Generation

Figures in $ millions Guidance Range

Free Cash Flow generation is expected to nearly triple from 2016 to 2020.

Headwinds in 2019 were largely due to the timing of certain investments and working capital.

2020 Guidance assumes normalized investments and working capital, with free cash flow funding the Company’s capital allocation priorities.

1CAGR is calculated from 2016 to the top of the 2020 Guidance range.22016 reflects reported Calendar Year results. 32017 figures are derived from reported unaudited quarterly results.

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AppendixFull Year 2019 Results & Non-GAAP Reconciliations

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Investor Presentation | 28

Non-GAAP to GAAP Reconciliation

(*) Amounts may not total due to rounding.

(in millions)* 2019 2018 2019 2018

Adjusted EBITDA

Net income (loss) 25.1$ (10.9)$ 44.4$ (15.1)$

Plus:

Interest expense, net 18.1 20.3 72.5 97.8

Income tax expense (benefit) 6.3 (8.1) 12.8 (66.2)

Depreciation expense 18.3 18.7 80.1 75.3

Amortization expense 13.4 15.3 56.3 104.9

Establish public company financial reporting compliance (a) 1.9 0.8 4.8 4.1

Business transformation and integration costs (b) 4.0 4.0 17.5 25.5

Expenses related to initial public offering (c) 0.9 — 1.0 6.8

Debt extinguishment (d) — 25.1 — 25.1

Equity-based compensation (e) 3.9 8.0 15.7 28.8

Management fees (f) — 11.0 — 13.1

Adjusted EBITDA 91.9$ 84.2$ 305.1$ 300.1$

Fiscal Year Ended

September 30,

Three Months Ended

September 30,

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Investor Presentation | 29

Non-GAAP to GAAP Reconciliation (cont.)

(*) Amounts may not total due to rounding.

(in millions)* 2019 2018 2019 2018

Adjusted Net Income

Net income (loss) 25.1$ (10.9)$ 44.4$ (15.1)$

Plus:

Amortization expense 13.4 15.3 56.3 104.9

Establish public company financial reporting compliance (a) 1.9 0.8 4.8 4.1

Business transformation and integration costs (b) 4.0 4.0 17.5 25.5

Expenses related to initial public offering (c) 0.9 — 1.0 6.8

Debt extinguishment (d) — 25.1 — 25.1

Equity-based compensation (e) 3.9 8.0 15.7 28.8

Management fees (f) — 11.0 — 13.1

Income tax adjustment (g) (4.2) (17.5) (21.7) (103.1)

Adjusted Net Income (h) 45.0$ 35.8$ 118.0$ 90.0$

Free Cash Flow and

Adjusted Free Cash Flow

Cash flows from operating activities 60.5$ 56.7$ 169.7$ 180.4$

Minus:

Capital expenditures 12.7 14.7 89.9 86.4

Plus:

Proceeds from sale of property and equipment — 8.0 6.8 12.0

Free Cash Flow 47.8$ 50.1$ 86.6$ 105.9$

Plus:

ValleyCrest land and building acquisition (i) — — — 21.6

Adjusted Free Cash Flow 47.8$ 50.1$ 86.6$ 127.6$

Fiscal Year Ended

September 30,

Three Months Ended

September 30,

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Investor Presentation | 30

Non-GAAP to GAAP Reconciliation (cont.)

(in millions)* 2019 2018 2019 2018

Severance and related costs 1.0$ 2.5$ 3.0$ 5.7$

Rebranding of vehicle fleet 0.1 0.1 0.5 12.5

Business integration 1.5 1.3 8.2 1.7

IT Infrastructure transformation and other 1.4 0.1 5.8 5.5

Business transformation and integration costs 4.0$ 4.0$ 17.5$ 25.5$

Fiscal Year Ended

September 30,

Three Months Ended

September 30,

(in millions)* 2019 2018 2019 2018

Tax impact of pre-tax income adjustments 3.4$ 16.1$ 19.8$ 59.6$

Discrete tax items 0.8 1.4 1.9 43.5

Income tax adjustment 4.2$ 17.5$ 21.7$ 103.1$

Fiscal Year Ended

September 30,

Three Months Ended

September 30,

(a) Represents costs incurred to establish public company financial reporting compliance, including costs to comply with the requirements of

Sarbanes-Oxley and the accelerated adoption of the revenue recognition standard (ASC 606 – Revenue from Contracts with Customers and other

miscellaneous costs.

(b) Business transformation and integration costs consist of (i) severance and related costs; (ii) vehicle fleet rebranding costs; (iii) business integration

costs and (iv) information technology infrastructure transformation costs and other.

(c) Represents transaction related expenses incurred in connection with the IPO and subsequent registration statements.

(d) Represents losses on the extinguishment of debt.

(e) Represents equity-based compensation expense recognized for equity incentive plans outstanding, including $19.6 million related to the IPO in the

fiscal year ended September 30, 2018.

(f) Represents fees paid pursuant to a monitoring agreement terminated on July 2, 2018 in connection with the completion of the IPO.

(g) Represents the tax effect of pre-tax items excluded from Adjusted Net Income and the removal of the applicable discrete tax items, which

collectively result in a reduction of income tax. The tax effect of pre-tax items excluded from Adjusted Net Income is computed using the statutory

rate related to the jurisdiction that was impacted by the adjustment after taking into account the impact of permanent differences and valuation

allowances. Discrete tax items include changes in laws or rates, changes in uncertain tax positions relating to prior years and changes in valuation

allowances. The fiscal year ended September 30, 2018 amount includes a $43.4 million benefit recognized as a result of the reduction in the U.S.

corporate income tax rate from 35% to 21% under the 2017 Tax Cut and Jobs Act.

(h) Adjusted EPS is defined as Adjusted Net Income divided by the weighted average number of common shares outstanding for the period used in

the calculation of basic EPS.

(i) Represents the acquisition of legacy ValleyCrest land and buildings in October 2017.

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Investor Presentation | 31

Non-GAAP to GAAP Reconciliation (cont.)

(*) Amounts may not total due to rounding.

(in millions)* September 30,

2019

September 30,

2018

Long-term debt, net 1,134.2$ 1,141.3$

Plus:

Current portion of long-term debt 10.4$ 13.0$

Financing costs, net 17.1 20.0

Present value of net minimum payment - capital lease obligations 8.5 10.1

Total Financial Debt 1,170.2$ 1,184.4$

Less: Cash and cash equivalents (39.1) (35.2)

Total Net Financial Debt 1,131.1$ 1,149.2$

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Thank You

Investor Relations Contact:

Daniel SchleinigerVP, Investor Relations

484.567.7148

[email protected]

Media Contact:

Fred JacobsVP, Communications & Public Affairs

484.567.7244

[email protected]

investor.brightview.com