BV 10-K & 10-Q changes, risk factors and insider trading

In addition, our former employees may start landscape services businesses similar to ours and compete directly with us. While our employees customarily sign non-competition agreements, such agreements do not fully protect us against competition from former employees and may not be enforceable depending on applicable law and/or circumstances,circumstances. including the rules approved by theThe Federal Trade Commission previously approved rules banning non-competition agreements, which atwere thelater timevacated. of the filing ofAlthough this Formrule 10-Kbanning arenon-competition unenforceableagreements duehas tobeen ongoing litigation. Consequently,vacated, we cannot predict with certainty whether, if challenged, a court will enforce any particular non-competition agreement.agreement or if future rulemaking in this area will occur. Any increased competition from businesses started by former employees may reduce our market share and adversely affect our business, financial position, results of operations and cash flows.

In connection with our acquisitions, we generally require that key management and former principals of the businesses we acquire enter into non-competition agreements in our favor. Enforceability of these non-competition agreements varies from state to state, and may depend on the relevant facts and circumstances, including the rules approved by the Federal Trade Commission banning non-competition agreements, which are currently unenforceable due to ongoing litigation.circumstances. Consequently, we cannot predict with certainty whether, if challenged, a court will enforce any particular non-competition agreement. Increased competition could materially and adversely affect our business, financial position, results of operations and cash flows.

With respect to our Development Services segment, a significant portion of our revenues are derived from development activities associated with new commercial real estate development, including hospitality and leisure, which has experienced periodic declines, some of which have been severe, including sustained declines associated with the COVID-19 pandemic. The strength of these markets depends on, among other things, housing starts, local occupancy rates, demand for commercial space, increased adoption of remote-working arrangements, non-residential construction spending activity, business investment and general economic conditions, which are a function of many factors beyond our control, including interest rates, employment levels, availability of credit, consumer spending, consumer confidence and capital spending. DuringFluctuation and uncertainty in construction generally, or as relates to specific projects, often results in project delays which adversely impact our services and results of operations. Moreover, during a downturn in the commercial real estate development industry, customers may decrease their spending on landscape development services by generally reducing the size and complexity of their new landscaping development projects. Additionally, when interest rates rise, there may be a decrease in the spending activities of our current and potential Development Services customers. Fluctuations in commercial real estate development markets could have an adverse effect on our business, financial position, results of operations or cash flows.

Our future success depends to a significant degree on the skills, experience and efforts of our executive management and other key personnel and their ability to provide us with uninterrupted leadership and direction. From time to time, there may be changes in our senior management team resulting from the hiring or departure of executives. Since the beginning of calendar year 2022, we have hired a new Chief Executive Officer and Chief Financial Officer, among other leadership changes. The failure to retain our executive officers and other key personnel or a failure to provide adequate succession plans could have an adverse impact. The availability of highly qualified talent is limited, and the competition for talent is robust. A failure to efficiently or effectively replace executive management members or other key personnel and to attract, retain and develop new qualified personnel could have an adverse effect on our operations and implementation of our strategic plan.

We use the U.S. government’s “E-Verify” program to verify employment eligibility for all new employees throughout our company. However, use of E-Verify does not guarantee that we will successfully identify all applicants who are ineligible for employment. Additionally, E-Verify may be inaccessible during outages or government shutdowns. Although we use E-Verify and require all new employees to provide us with government-specified documentation evidencing their employment eligibility, some of our employees may, without our knowledge, be unauthorized workers. The employment of unauthorized workers may subject us to fines or penalties, and adverse publicity that negatively impacts our reputation and may make it more difficult to hire and keep qualified employees. We are subject to regulations of U.S. Immigration and Customs Enforcement, or ICE, and we are audited from time to time by ICE for compliance with work authentication requirements. While we believe we are in compliance with applicable laws and regulations, if we are found not to be in compliance as a result of any audits, we may be subject to fines or other remedial actions. See “Business—Regulatory Overview—Employee and Immigration Matters.”

Accounting for our numerous historical transactions has resulted in the generation of various amounts of goodwill. Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the tangible and identifiable intangible assets acquired, liabilities assumed and any non-controlling interest. Intangible assets, including goodwill, are assigned to our segments based upon their fair value at the time of acquisition. In accordance with accounting principles generally accepted in the United States of America (“GAAP”), goodwill and indefinite lived intangible assets are evaluated for impairment annually, or more frequently if circumstances indicate impairment may have occurred. As of September 30, 2024,2025, the net carrying value of goodwill and other intangible assets, net, represented $2,111.5$2,082.2 million, or 62%61% of our total assets. A future impairment, if any, could have a material adverse effect to our financial position or results of operations. For example, the fair value of our Maintenance reporting unit exceeded the carrying value by 15.4%. Since the Maintenance reporting unit fair value did not substantially exceed the carrying value, we may be at risk for an impairment loss in the future if forecasted trends assumed in the fair value calculation are not realized. See Note 7 "Intangible Assets, Goodwill, Acquisitions, and Divestitures” to our audited consolidated financial statements included in Part II. Item 8 of this Form 10-K for additional information related to impairment testing for goodwill and other intangible assets and the associated charges taken.

Some of the equipment and vehicles that our employees use isare dangerous, and an increase in accidents resulting from the use of such equipment and vehicles could negatively affect our reputation, results of operations and financial position.

Borrowings under our Credit Agreement and Receivables Financing Agreement are at variable rates of interest and expose us to interest rate risk. Increases in interest rates can result in increases to the cost of servicing our debt under our Credit Agreement and Receivables Financing Agreement. For the year ended September 30, 2024,2025, our interest expense was $62.4$53.7 million, compared to $97.4$62.4 million for the year ended September 30, 2023.2024. Moreover, borrowings under our Credit Agreement and Receivables Financing Agreement bear interest at a rate per annum based on a secured overnight financing rate (SOFR), plus a margin. If interest rates continue to increase, our debt service obligations on the variable rate indebtedness will increase even though the amount borrowed will remain the same, our ability to refinance some or all of our existing indebtedness may be impacted and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease.

The Credit Agreement also contains certain customary affirmative covenants and events of default, including a change of control. The Credit Agreement also contains a financial maintenance requirement with respect to the Revolving Credit Facility, prohibiting us from exceeding a certain first lien secured leverage ratio under certain circumstances. For example, if we exceed such first lien leverage ratio, an additional covenant comes into effect and availability under the Revolving Credit Facility would be significantly reduced. As a result of these covenants and restrictions, we are limited in how we conduct our business, and we may be unable to raise additional debt or equity financing to compete effectively or to take advantage of new business opportunities. The terms of any future indebtedness we may incur could include more restrictive covenants. We cannot guarantee that we will be able to maintain compliance with these covenants in the future and, if we fail to do so, that we will be able to obtain waivers from the lenders and/or amend the covenants.

Our employees, directors, officers and affiliates, including KKR and One Rock, hold substantial amounts of shares of our common stock and all of our outstanding Series A Convertible Preferred Stock (the “Series A Preferred Stock”), which is convertible into shares of our common stock. As of September 30, 2024,2025, the Affiliated Investors held approximately 33,133,12321,533,123 shares of our common stock and 500,000 shares of our Series A Preferred Stock, which represents, in the aggregate, approximately 58.7% of the combined voting power50.8% of our outstanding shares of preferredcommon stock and commonpreferred stock.stock (on an as-converted basis). Sales of a substantial number of shares of our common stock in the public market by these stockholders, such as the underwritten sale of 11.6 million shares of common stock by KKR in June 2025, or the perception that such sales could occur, could substantially decrease the market price of our common stock. Conversion of a substantial number of shares of the Series A Preferred Stock into shares of our common stock, or the perception that such conversion could occur, could also decrease the market price of our common stock. Other than restrictions on trading that arise under securities laws (or pursuant to our securities trading policy that is intended to facilitate compliance with securities laws), including the prohibition on trading in securities by or on behalf of a person who is aware of nonpublic material information, we have no restrictions on the right of our employees, directors and officers, and their affiliates, to sell their unrestricted shares of common stock.

As of September 30, 2024,2025, the Affiliated Investors beneficially ownowned approximately 58.7%50.8% of the combined voting power of our outstanding shares of preferred stock and common stock. As a result, the Affiliated Investors have the ability to influence the election of our directors and the outcome of other corporate actions requiring shareholder approval, such as: (i) a merger or a sale of our Company, (ii) a sale of all or substantially all of our assets, and (iii) amendments to our articles of incorporation and bylaws. Additionally, four members of our Board of Directors are affiliated with certain of the Affiliated Investors and so the Affiliated Investors also have significant control over our business, policies and affairs by their affiliates serving as directors of our Company. This concentration of voting power and control could have a significant effect in delaying, deferring or preventing an action that might otherwise be beneficial to our other shareholders, including a change in control of the Company, or that could be disadvantageous to our shareholders with interests different from our Affiliated Investors. In addition, the significant concentration of stock ownership may adversely affect the market value of the Company’s common stock due to investors’ perception that conflicts of interest may exist or arise.

These provisions provide for, among other things, our Board of Directors to issue one or more series of preferred stock; advance notice requirements for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings; certain limitations on convening special stockholder meetings; the removal of directors only upon the affirmative vote of the holders of at least 66 2⁄3% of the shares of common stock entitled to vote generally in the election of directors ifso long as KKR and its affiliates ceasecontinue to beneficially own atless leastthan 40% of shares of common stock entitled to vote generally in the election of directors. In addition, certain provisions of our certificate of incorporation and bylaws may be amended only by the affirmative vote of at least 66 2⁄3% of shares of common stock entitled to vote generally in the election of directors ifso long as KKR and its affiliates ceasecontinue to beneficially own atless leastthan 40% of shares of common stock entitled to vote generally in the election of directors. These anti-takeover provisions could make it more difficult for a third party to acquire us, even if the third party’s offer may be considered beneficial by many of our stockholders. As a result, our stockholders may be limited in their ability to obtain a premium for their shares.

Our certificate of incorporation provides, subject to limited exceptions, that unless we consent to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall, to the fullest extent permitted by law, be the sole and exclusive forum for any (i) derivative action or proceeding brought on behalf of our company, (ii) action asserting a claim of breach of a fiduciary duty owed by any director, officer, or other employee or stockholder of our company to the Company or our stockholders, creditors or other constituents, (iii) action asserting a claim against the Company or any director or officer of the Company arising pursuant to any provision of the Delaware General Corporation Law, or the DGCL, or our amended and restated certificate of incorporation or our amended and restated bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware, or (iv) action asserting a claim against the Company or any director or officer of the Company governed by the internal affairs doctrine. Our certificate of incorporation further provides that, to the fullest extent permitted by law, the federal district courts of the United States of America will be the exclusive forum for resolving any complaint asserting a cause of action arising under the United States federal securities laws. While the Delaware Supreme Court has upheld the validity of similar provisions under the DGCL, there is uncertainty as to whether a court in another state would enforce such a forum selection provision. Our exclusive forum provision does not relieve us of our duties to comply with the federal securities laws and the rules and regulations thereunder, and our stockholders will not be deemed to have waived our compliance with these laws, rules and regulations.

Customer and consumer demand for our services may be impacted by weak economic conditions, heightened inflation, equity market volatility or other negative economic factors in the U.S. or other nations. The United States has announced a wide range of tariffs on certain imports from many countries, including Canada, Mexico, members of the European Union and the United Kingdom. The extent and duration of the tariffs and the resulting impact on general economic conditions and on our business are uncertain and depend on various factors, such as recent legal challenges to the U.S.'s imposition of tariffs, negotiations between the U.S. and affected countries, the responses of other countries or regions, relief that may be granted, availability and cost of alternative sources of supply and demand for our services in affected markets. In addition, if the U.S. economy enters a recession, we may experience a decline in demand for our services and may have to decrease prices, all of which could have a material adverse impact on our financial results. The severity and length of time that a downturn in economic and financial market conditions may persist, as well as the timing, strength and sustainability of any recovery from such downturn, are unknown and are beyond our control. In addition, geopolitical conflicts, such as the current war in Ukraine, conflicts in the Middle East, or potential conflict between China and Taiwan and any related international response may exacerbate these inflationary pressures. Therefore, the recessionary risks discussed above and elsewhere in these risk factors are more pronounced in the current economic environment.

Our reputation and/or business could be negatively impacted by environmental,corporate social and governance (“ESG”)responsibility matters and/or our reporting of such matters.

In recent years, there has been an increaseda focus from stakeholders, regulators and the public in general on ESGcorporate responsibility matters, including greenhouse gas emissions and climate-related risks, renewable energy, water stewardship, waste management, diversity, equality and inclusion, responsible sourcing and supply chain, human rights, and social responsibility. We actively manage these issues and have established and publicly announced certain goals, commitments, and targets which we may refine further in the future. Evolving stakeholder expectations, regulatory obligations, economic conditions and our efforts to manage these issues, report on them, and accomplish our goals present numerous operational, regulatory, reputational, financial, legal, and other risks, any of which could have a material adverse impact, including on our reputation and stock price. In addition, with anti-ESG sentiment present in some of our markets, we could experience reduced revenue and reputational harm if we are targeted by groups or influential individuals who disagree with our public positions on social or environmental issues.

We may be unable to satisfactorily meet evolving standards, regulations and disclosure requirements related to ESG.corporate responsibility. For example, on March 6, 2024, the SEC adopted a final rule requiring public companies to include various climate-related disclosures in certain documents filed with the SEC, including climate-related financial statement metrics, greenhouse gas emissions and climate-related targets and goals, and management’s role in managing material climate-related risks. A number of state legislators and regulators have adopted or are currently considering proposing or adopting other rules, regulations, directives, initiatives and laws requiring ESG-relatedcorporate responsibility-related disclosures or limiting (or affirmatively requiring) certain ESG-relatedcorporate responsibility related conduct, including California laws S.B. 253, S.B. 261 and A.B. 1305. In the event that we were to become subject to any of the newly adopted climate change and/or ESG-relatedcorporate responsibility related disclosure regimes, it could require us to, among other things, (i) restrict or limit our operating activities or other conduct, (ii) make material capital improvements and expend material capital resources in connection with such compliance efforts, and (iii) alter our business and operational strategy more generally. Furthermore, there continues to be a lack of consistent proposed climate change and ESG-relatedcorporate responsibility related legislation, which creates regulatory and economic uncertainty. Such matters can affect the willingness or ability of investors to make an investment in our Company, as well as our ability to meet regulatory requirements, including proposed rules related to greenhouse gas emissions. Any failure, or perceived failure, to meet evolving regulations and industry standards could have an adverse effect on our business, results of operations, financial condition, or stock price.

As a public company, we have significant requirements for financial reporting and internal controls. The process of maintaining effective internal controls is a continuous effort that requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to maintain a system of internal controls that is adequate to satisfy our reporting obligations as a public company. If we are unable to maintain appropriate internal financial reporting controls and procedures, it could cause us to fail to meet our reporting obligations on a timely basis, result in material misstatements in our consolidated financial statements and harm our results of operations. In addition, we are required, pursuant to Section 404,404 of the Sarbanes-Oxley Act, to furnish annually a report by management on, among other things, the effectiveness of our internal control over financial reporting. This assessment includes disclosure of any material weaknesses identified by our management in our internal control over financial reporting. The rules governing the standards that must be met for our management to assess our internal control over financial reporting are complex and require significant documentation, testing and possible remediation. Testing and maintaining internal controls may divert our management’s attention from other matters that are important to our business. Our independent registered public accounting firm is also required to issue an attestation report on effectiveness of our internal controls in each annual report on Form 10-K.

Our Maintenance Services segment delivers a full suite of recurring commercial landscaping services in both evergreen and seasonal markets, ranging from mowing, gardening, mulching and snow removal, to more horticulturally advanced services, such as water management, irrigation maintenance, tree care,care and golf course maintenance and specialty turf maintenance. In addition to contracted maintenance services, we also have a strong track record of providing value-added landscape enhancements. We primarily self-perform our maintenance services through our national branch network, which are route-based in nature. Our maintenance services customers include Fortune 500 corporate campuses and commercial properties, HOAs, public parks, leading international hotels and resorts, airport authorities, municipalities, hospitals and other healthcare facilities, educational institutions, restaurants and retail, and golf courses, among others.

Through our Development Services segment, we provide landscape architecture and development services for new facilities and significant redesign projects. Specific services include project design and management services, landscape architecture, landscape installation, irrigation installation, tree moving and installation, pool and water features andfeatures, sports field services,services and specialty turf maintenance, among others. Our development services are comprised of sophisticated design, coordination and installation of landscapes at some of the most recognizable corporate, athletic and university complexes and showcase highly visible work that is paramount to our customers’ perception of our brand as a market leader.

Cost of services provided is comprised of direct costs we incur associated with our operations during a period and includes employee costs, subcontractor costs, purchased materials, and operating equipment and vehicle costs. Employee costs consist of wages and other labor-related expenses, including benefits, workers compensation and healthcare costs, for those employees involved in delivering our services. Subcontractor costs consist of costs relating to our qualified service partner network in our Maintenance Services segment and subcontractors we engage from time to time in our Development Services segment. When our use of subcontractors increases, we may experience incrementally higher costs of services provided. Operating equipment and vehicle costs primarily consist of depreciation related to branch operating equipment and vehicles and related fuel expenses. A large component of our costs are variable, such as labor, subcontractor expenseexpense, fuel and materials.

Selling, general and administrative expense consists of costs incurred related to compensation and benefits for management, sales and administrative personnel, equity-based compensation, branch and office rent and facility operating costs, depreciation expense related to branch and office locations, as well as professional fees, software costs, goodwill impairment, and other miscellaneous expenses. Corporate expenses, including corporate executive compensation, finance, legal and information technology, are included in consolidated selling, general and administrative expense and not allocated to the business segments.expense.

Other (income) expense consists primarily of investment gains related to investments held in a Rabbi Trust.

We manage operations through the two operating segments described above. In addition to our GAAP financial measures, we review various non-GAAP financial measures, including Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Earnings per Share (“Adjusted EPS”), and Adjusted Free Cash Flow.

We believe Adjusted Free Cash Flow is a helpful supplemental measure to assist us and investors in evaluating our liquidity. Adjusted Free Cash Flow represents cash flows from operating activities less capital expenditures, net of proceeds from sales of property and equipment. We believe Adjusted Free Cash Flow is useful to provide additional information to assess our ability to pursue business opportunities and investments and to service our debt. Adjusted Free Cash Flow has limitations as an analytical tool, including that it does not account for our future contractual commitments and excludes investments made to acquire assets under finance leases and required debt service payments.

Management regularly uses these measures as tools in evaluating our operating performance, financial performance and liquidity, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure and capital investments. Management uses Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted EPS and Adjusted Free Cash Flow to supplement comparable GAAP measures in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, to establish discretionary annual incentive compensation and to compare our performance against that of other peer companies using similar measures. In addition, we believe that Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted EPS and Adjusted Free Cash Flow are frequently used by investors and other interested parties in the evaluation of issuers, many of which also present Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted EPS and Adjusted Free Cash Flow when reporting their results in an effort to facilitate an understanding of their operating and financial results and liquidity. Management supplements GAAP results with non-GAAP financial measures to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone.

Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted EPS are provided in addition to, and should not be considered as alternatives to, net (loss) income or any other performance measure derived in accordance with GAAP. Adjusted Free Cash Flow is provided in addition to, and should not be considered as an alternative to, cash flow from operating activities or any other measure derived in accordance with GAAP as a measure of our liquidity. Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted EPS and Adjusted Free Cash Flow have limitations as analytical tools, and you should not consider such measures either in isolation or as substitutes for analyzing our results as reported under GAAP. In addition, because not all companies use identical calculations, the presentations of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company. Additionally, these measures are not intended to be a measure of free cash flow available for management’s discretionary use as they do not consider certain cash requirements such as interest payments, tax payments and debt service requirements.

In accordance with GAAP, the results of the acquisitions we have completed are reflected in our consolidated financial statements from the date of acquisition. We incur transaction costs in connection with identifying and completing acquisitions and ongoing integration costs as we integrate acquired companies and seek to achieve synergies. During the fiscal year ended September 30, 2024, the Company incurred $0.4 million of integration costs related to acquisitions completed prior to fiscal 2024. While integration costs vary based on factors specific to each acquisition, such costs are primarily comprised of one-time employee retention costs, employee onboarding and training costs, and fleet and uniform rebranding costs. We typically anticipate integration costs to represent approximately 7%-9% of the acquisition price, and to be incurred within 12 months of acquisition completion.

Net service revenues for the fiscal year ended September 30, 20242025 decreased $48.9$94.3 million, or 1.7%,3.4%, to $2,767.1$2,672.8 million, from $2,816.0$2,767.1 million in the 20232024 period. The decrease was driven by a decrease in Maintenance Services revenues of $102.5$72.7 million, partiallycombined offsetwith bya an increasedecrease in Development Services revenues of $50.8$19.7 million as discussed further below in Segment Results.

Gross profit for the fiscal year ended September 30, 20242025 decreased $33.3$23.9 million, or 4.9%,3.7%, to $645.6$621.7 million, from $678.9$645.6 million in the 20232024 period. Gross margin decreasedremained 80flat basis points toat 23.3% for the fiscal year ended September 30, 2024, from 24.1% in the 2023 period.2025. The decreases in gross profit and gross margin werewas primarily driven by the decrease net service revenues, described above,above coupledcombined with increased labor costs resulting from increased investments in service levels. Partially offsetting this was lower subcontractor costs as a result of our strategic reduction in non-core businesses.depreciation.

Selling, general and administrative expense for the fiscal year ended September 30, 20242025 decreased $36.9$38.7 million, or 6.9%,7.8%, to $496.5$457.8 million, from $533.4$496.5 million in the 20232024 period. As a percentage of revenue, selling, general and administrative expense decreased 11080 basis points for the fiscal year ended September 30, 20242025 to 17.9%,17.1%, from 19.0%17.9% in the 20232024 period. The decrease was driven primarily by decreases in compensation-related costs as a result of the Company's cost cuttingmanagement measuresinitiatives partiallycombined offsetwith bya the increasedecrease in business transformation and integration costs.

There was no gain on divestiture for the fiscal year ended September 30, 2025. Gain on divestiture consistsfor the fiscal year ended September 30, 2024 was $43.6 million which consisted of the realized gain on sale and transaction related expenses from the divestiture of U.S. Lawns on January 12, 2024.

Other income was $2.0$0.4 million for the fiscal year ended September 30, 20242025 compared to other expenseincome of $6.7$2.0 million in the 20232024 period. The $8.7$1.6 million increasedecrease in other (income) expense was driven principally by thechanges losses onin the extinguishmentvalue of debtinvestments incurredheld in connectionthe Rabbi Trust and costs associated with the repayment of a portionrepricing of the SeriesCompany's Bterm Term Loan in 2023.loan.

Interest expense for the fiscal year ended September 30, 20242025 decreased $35.0$8.7 million, or 35.9%,13.9%, to $62.4$53.7 million, from $97.4$62.4 million in the 20232024 period. The decrease was driven principally by the decrease in interest rates as a result of the long-termrepricing of our Series B Term Loans in fiscal 2024 and the decrease in the Company's long term debt balance combinedpartially withoffset by an increase in finance lease interest incomeexpense associatedand witha the increasedecrease in theinterest cash and cash equivalents balance.income.

For the fiscal year ended September 30, 2024,2025, income tax expense increaseddecreased $25.5$4.8 million, or 554.3%,15.9%, to $30.1$25.3 million, compared to $4.6$30.1 million in the 20232024 period. The change in income tax expense is primarily attributable to the change in the Company’s pretax income of $96.5$81.3 million in the current period compared to pretax lossincome of $3.1$96.5 million in the 20232024 period.

Net (Loss) Income

For the fiscal year ended September 30, 2024,2025, net income increaseddecreased by $74.1$10.4 million, to a net income of $66.4$56.0 million, from net loss of $(7.7)$66.4 million in the 20232024 period. The increasedecrease in net income was primarily due to the changes noted above.

For the fiscal year ended September 30, 2024,2025, Dividends on Series A Convertible Preferred Shares were $35.7$35.8 million compared to $3.2$35.7 million in the 20232024 period. The dividends on the Series A Convertible Preferred Stock were the result of the Series A convertible preferred share agreement, which was entered into in the fourth quarter of fiscal 2023.

Adjusted EBITDA increased $26.0$27.6 million for the fiscal year ended September 30, 2024,2025, to $324.7$352.3 million, from $298.7$324.7 million in the 20232024 period. Adjusted EBITDA as a percentage of revenuemargin was 11.7%13.2% and 10.6%11.7% for the fiscal years ended 20242025 and 2023,2024, respectively. The increase in Adjusted EBITDA was principally driven by an increase of $23.5$18.3 million, or 28.4%20.6% in Development Services Segment Adjusted EBITDA, and an increase of $1.8$9.3 million, or 0.6%3.9% in Maintenance Services Segment Adjusted EBITDA, as discussed further below in Segment Results.

We classify our business into two segments: Maintenance Services and Development Services. Our corporate operations are not allocated to the segments and are not discussed separately as any results that hadon a significantpro impactrata basis, based on operatingsegment results are included in the consolidated results discussion above.revenue.

Maintenance Services net service revenues for the fiscal year ended September 30, 20242025 decreased by $102.5$72.7 million, or 5.0%,3.7%, compared to the 20232024 period. The decrease was primarily driven by a $115.2 million, or 5.6%, decrease in underlying commercial landscape services, largely underpinned by strategic reductions in ourof non-core businesses,businesses asand wellto asa lesser extent a decline in ourcommercial ancillary services business. This was partially offset by a $11.8 million increaselandscaping in snowour removalcore services revenue, primarily due to increased snow removal services volume.business.

Segment Adjusted EBITDA for the fiscal year ended September 30, 20242025 increased $1.8$9.3 million, to $279.7$245.5 million, compared to $277.9$236.2 million in the 20232024 period. Segment Adjusted EBITDA Margin increased 80100 basis points to 14.2%13.0% in the year ended September 30, 2024,2025, from 13.4%12.0% in the 20232024 period. The increase in Segment Adjusted EBITDA and Segment Adjusted EBITDA Margin were principally driven by lower laborpersonnel, vehicle, and equipment related costs as a result of the Company's cost management initiatives. These savings were partially offset by the decrease in revenues described above.

Development Services net service revenues for the fiscal year ended September 30, 20242025 increaseddecreased $50.8$19.7 million, or 6.7%,2.4%, compared to the 20232024 period. The increasedecrease was primarily driven by anthe increasetiming inof projects during the second half of fiscal 2025, which were partially offset by increased Development Services project volumes.volumes in the first half of fiscal 2025.

Segment Adjusted EBITDA for the fiscal year ended September 30, 20242025 increased $23.5$18.3 million, to $106.3$106.8 million, compared to $82.8$88.5 million in the 20232024 period. Segment Adjusted EBITDA Margin increased 220260 basis points, to 13.1%13.5% for the period from 10.9% in the prior year. The increases in Segment Adjusted EBITDA and Segment Adjusted EBITDA Margin were primarily driven by the increasereductions in revenuesoverhead describedcosts above.due to the Company's cost management initiatives, combined with the timing and mix of projects in the period.

Set forth below are the reconciliations of net income to Adjusted EBITDA and Adjusted Net Income and cash flows from operating activities to Adjusted Free Cash Flow.

Represents expenses related to distinct initiatives, typically significant enterprise-wide changes.changes, including actions taken as part of the Company's One BrightView initiative. Such expenses are excluded from the measures disclosed above since such expenses vary in amount based on occurrence as well as factors specific to each of the activities, are outside of the normal operations of the business, and create a lack of comparability between periods.

The Company is party to the Credit Agreement, a five-year revolving credit facility that, pursuant to Amendment No. 6 to the AmendmentCredit Agreement, currentlydated April 22, 2022 (the "Amendment Agreement"), matures on April 22, 2027 (the “Revolving Credit Facility”) and, through a wholly-owned subsidiary, a receivables financing agreement dated April 28, 2017 (as amended, the “Receivables Financing Agreement”). Each of the Company's credit facilities bear interest based in-part on a secured overnight financing rate. See “Description of Indebtedness”.

Net cash provided by operating activities for the fiscal year ended September 30, 20242025 increased $75.7$86.2 million, to $205.6$291.8 million, from $129.9$205.6 million in the 20232024 period. This increase was due to an increase in net income adjusted for non-cash activities, combined with increases in cash provided by accounts receivablepayable and unbilledother andoperating deferred revenue.liabilities. This was partially offset by increasesan increase in cash used for other operating assets and accounts payable and other operating liabilities.assets.

Net cash used in investing activities was $5.6$223.9 million in the fiscal year ended September 30, 2024,2025, aan decreaseincrease of $55.8$218.3 million compared to $61.4$5.6 million for the 20232024 period. The decreaseincrease in cash used in investing activities was driven by $51a $175.8 million of proceeds from divestitures, and $13.8 million decreaseincrease in cash used for acquisitions.the purchase of property and equipment, and a $51.0 million decrease in proceeds from divestiture in comparison to the prior year. This was partially offset by $7.1$9.5 million increase in capital expenditures and $3.5 million decrease in proceeds from the sale of property and equipment.

Net cash used in financing activities of $126.6$133.8 million for the fiscal year ended September 30, 20242025 included repayments of our Receivables Financing Agreement of $87.3 million, repayments of finance lease obligations of $36.3$48.4 million andmillion, Series A preferred stock dividend paymentsdividends of $17.8$35.8 million.million, Theserepayments wereof partiallyour offsetReceivable byFinancing anAgreement increaseof $29.1 million, repurchase of common stock and distributions of $24.2 million, and a decrease in book overdrafts of $20.1$12.1 million. This was partially offset by proceeds from our Receivable Financing Agreement of $14.5 million.

Adjusted Free Cash Flow

Adjusted Free Cash Flow increaseddecreased $65.1$80.1 million to $145.3$65.2 million for the fiscal year ended September 30, 20242025 from $80.2$145.3 million in the 20232024 period. The increasedecrease in Adjusted Free Cash Flow was due to an increase in net cash provided by operating activities offset by an increase in cash used for capital expenditures, each as described above.

On April 22, 2022, the Company entered into the Amendment No. 6 to the Credit Agreement (the “Amendment Agreement”),Agreement, which amended the existing Credit Agreement to provide for: (i) a $1,200.0 million seven-year term loan (the “Series B Term Loan”) and (ii) a $300.0 million five-year revolving credit facility (the “Revolving Credit Facility”). The Series B Term Loan matures on April 22, 2029 and bears interest at a rate per annum of a secured overnight financing rate (“Term SOFR”), plus a margin of 3.25% or a base rate (“ABR”) plus a margin of 2.25%, subject to SOFR and ABR floors of 0.50% and 1.50%, respectively. The Company used the net proceeds from the Series B Term Loan to repay all amounts then outstanding under the Company’s Credit Agreement. As a result of the repayment of the amounts outstanding under the Company's Credit Agreement, the Company recorded a loss on debt extinguishment of $12.6 million due to accelerated amortization of deferred financing fees and original issue discount included in the Other expense (income) line of the Consolidated Statements of Operations for the year ended September 30, 2022. An original issue discount of $12.0 was incurred when the Series B Term Loan was issued and is being amortized using the effective interest method over the life of the debt, resulting in an effective yield of 3.42%.

On August 31, 2023, the Company entered into Amendment No. 7 to the Credit Agreement (the “Seventh Credit Agreement Amendment”). The Seventh Credit Agreement Amendment (i) amends the definition of “Permitted Holders” to include Birch Equity Holdings, LP, a Delaware limited partnership, Birch-OR Equity Holdings, LLC, a Delaware limited liability company and One Rock Capital Partners, LLC and (ii) provides for a 1.00% prepayment premium for voluntary prepayments made in connection with repricing transactions or amendments made where the primary purpose of which is to decrease the effective yield, and which shall be applicable until six months after entering into the Seventh Credit Agreement Amendment.yield.

There were no debt repayments on the Series B Term Loan for the fiscal yearyears ended September 30, 2024.2025 Debt repayments for the Series B Term Loan totaled $459.0 million for the fiscal year endedand September 30, 2023.2024.

The Company has a five-year $300 million revolving credit facility that matures on April 22, 2027 and bears interest at a rate per annum of Term SOFR plus a margin ranging from 2.00% to 2.50%, or ABR plus a margin ranging from 1.00 to 1.50%, subject to SOFR and ABR floors of 0.00% and 1.00%, respectively, with the margin on the Revolving Credit Facility determined based on the Company’s first lien net leverage ratio. The Revolving Credit Facility replaced the previous $260.0 million revolving credit facility under the Credit Agreement. The Company had no outstanding balance under the Revolving Credit Facility as of September 30, 20242025 and September 30, 2023.2024. There were no borrowings or repayments under the facility during the yearyears ended September 30, 2024.2025 There were $33.5 million borrowings under the facility during the year endedand September 30, 2023, of which, $33.5 million were repaid during the same period.2024. The Company had no letters of credits issued and outstanding as of September 30, 20242025 and had $42.6 million of letters of credits issued and outstanding as of September 30, 2023. The weighted average interest rate on the Revolving Credit Facility was 6.9% for the year ended September 30, 2023.2024.

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The ASU expands public entities' segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment's profit or loss and assets. The purpose of the guidance is to enable investors to better understand an entity's overall performance and assess potential future cash flows. The amendmentCompany isadopted effectivethe updated accounting guidance on a retrospective basis for fiscalthe yearsyear beginningended afterSeptember December30, 15, 2023 and interim periods in fiscal years beginning after December 15, 2024.2025. The Company is in the process of evaluating the impactadoption of ASU No. 2023-07 did not have a material impact on itsthe Company's consolidated financial statements. Refer to Note 15 "Segments" to our consolidated financial statements for related disclosures.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU expands public entities tax disclosures including improving disclosures surrounding the company's rate reconciliation, cash taxes paid, and disaggregation of income tax expense (or benefit) from continuing operations. The amendmentCompany ishas effectiveadopted and implemented the applicable disclosure requirements for annualthe periodsyear beginningended afterSeptember December30, 15, 2024.2025. The Company is in the process of evaluating the impactadoption of ASU No. 2023-09 did not have a material impact on itsthe Company's consolidated financial statements. Refer to Note 11 "Income Taxes" to our consolidated financial statements for further details.

Cost of services provided is comprised of direct costs we incur associated with our operations during a period and includes employee costs, subcontractor costs, purchased materials, and operating equipment and vehicle costs. Employee costs consist of wages and other labor-related expenses, including benefits, workersself compensationinsurance and healthcare costs, for those employees involved in delivering our services. Subcontractor costs consist of costs relating to our qualified service partner network in our Maintenance Services segment and subcontractors we engage from time to time in our Development Services segment. When our use of subcontractors increases, we may experience incrementally higher costs of services provided. Operating equipment and vehicle costs primarily consist of depreciation related to branch operating equipment and vehicles and related fuel expenses. A large component of our costs are variable, such as labor, subcontractor expense, fuel and materials.

Selling, general and administrative expense consists of costs incurred related to compensationcompensation, benefits, and benefitsself insurance for management, sales and administrative personnel, equity-based compensation, branch and office rent and facility operating costs, depreciation expense related to branch and office locations, as well as professional fees, software costs and other miscellaneous expenses. Corporate expenses, including corporate executive compensation, finance, legal and information technology, are included in consolidated Selling, general and administrative expense.

Amortization expense consists of the periodic amortization of intangible assets,assets and customer relationships. The corresponding intangible assets were originally recognized in connection with the KKR and ValleyCrest acquisitions, as well as from subsequent acquisitions.

Other Expense (Income)

Other expense (income) consists primarily of losses on debt extinguishment as well as investment gains and losses related to investments held in Rabbi Trust.

Based on our most recent annual analysis as of July 1, 2025, the fair values for all identified reporting units exceeded the carrying values, and therefore no indicators of impairment existed for the reporting units; however, the fair value of the Maintenance reporting unit exceeded the carrying value by 15.4%. Since the Maintenance reporting unit fair value did not substantially exceed the carrying value, we may be at risk for an impairment loss in the future if interest rates and market conditions continue to trend unfavorably or if our forecasts assumed in the fair value calculation are not realized. As of MarchJune 31,30, 2026, there was $1,797.7 million of goodwill recorded related to the Maintenance reporting unit.

Three Months Ended MarchJune 31,30, 2026 compared to Three Months Ended MarchJune 31,30, 2025

Net service revenues for the three months ended MarchJune 31,30, 2026 increased $40.3$9.3 million, or 6.1%,1.3%, to $702.9$717.6 million, from $662.6$708.3 million in the 2025 period. The increase was driven by an increase in Maintenance Services revenues of $61.8 million, partially offset by a decrease in Development Services revenues of $22.3$9.1 million.

Gross profit for the three months ended MarchJune 31,30, 2026 decreased $9.8$19.0 million, or 6.6%,11.1%, to $137.7$151.9 million, from $147.5$170.9 million in the 2025 period. Gross margin decreased 270290 basis points, to 19.6%,21.2%, in the three months ended MarchJune 31,30, 2026, from 22.3%24.1% in the comparable 2025 period. The decreasesdecrease in gross profit and gross margin werewas primarily driven by increaseda subcontractornon-routine costsself-insurance adjustment and increased depreciation expense, largelypartially offset by increasesthe increase in net service revenues anddescribed decreases in materials costs.above.

Selling, general and administrative expense for the three months ended MarchJune 31,30, 2026 decreasedincreased $1.8$8.3 million, or 1.5%,7.8%, to $116.3$114.5 million, from $118.1$106.2 million in the 2025 period. As a percentage of revenue, Selling, general and administrative expense decreasedincreased 130100 basis points for the three months ended MarchJune 31,30, 2026 to 16.5%16.0% from 17.8%15.0% in the 2025 period. The decreaseincrease was primarily driven by anon-routine decreaseself-insurance in business transformation and integration costsadjustment combined with increased efficiencies as a result of the Company's cost management initiatives, partially offset by increased selling costs driven by the company’sCompany's investment in new sellers.sellers, partially offset by a decrease in non-seller compensation costs.

Amortization expense for the three months ended MarchJune 31,30, 2026 decreased $1.8$2.0 million, or 25.4%,28.2%, to $5.3$5.1 million from $7.1 million in the 2025 period. The decrease was principally due the decrease in the amortization of intangible assets, based on the pattern consistent with expected future cash flows calculated at the time the assets were acquired.

Other expense was $0.1$8.9 million for the threenine months ended MarchJune 31,30, 2026 compared to expense of $0.8$0.1 million in the 2025 period. The decreasechange of $0.7$8.8 million was driven principally by coststhe associatedlosses on the extinguishment of debt in connection with the repricingTenth ofCredit Agreement Amendment and the Company'sEleventh termCredit loanAgreement Amendment in fiscal 2025.2026.

Interest expense, net for the threenine months ended MarchJune 31,30, 2026 increased $0.9$1.8 million, or 7.0%,4.5%, to $13.7$42.1 million from $12.8$40.3 million in the 2025 period. The increase was driven by an increase in interest expense due to the impact of interest rate derivative contracts, a decrease in interest income associated with the decrease in the Company's cash and cash equivalents balance combined with increases in interest expense due to the impact of interest rate derivative contracts and an increase in the Company's outstanding debt balance.balance, and an increase in finance lease interest. These were partially offset by lower interest expense caused by the decrease in interest rates as a result of the repricing of our Series B Term Loans in fiscal 2025.

Income Tax Expense(Benefit)

For the threenine months ended MarchJune 31,30, 2026, Income tax expensebenefit was $0.6$2.3 million compared to $2.3expense of $10.7 million in the 2025 period. The decreaseincrease was primarily attributable to the change in Income (loss) before income taxes.

Net Loss (Income)

For the threenine months ended MarchJune 31,30, 2026, Net incomeloss was $1.7$7.4 million compared to a Net income of $6.4$28.3 million in the 2025 period due to the changes noted above. Net loss as a percentage of revenue was 0.2%0.4% for the threenine months ended MarchJune 31,30, 2026 compared to 1.0%1.4% for the threenine months ended MarchJune 31,30, 2025.

Adjusted EBITDA increaseddecreased $5.6$10.2 million for the threenine months ended MarchJune 31,30, 2026, to $79.1$228.6 million, from $73.5$238.8 million in the 2025 period. Adjusted EBITDA as a percentage of revenue was 11.3%11.2% and 11.1%12.1% for the threenine months ended MarchJune 31,30, 2026 and 2025, respectively. The increasedecrease in Adjusted EBITDA was primarily driven by an increasedecrease of $13.2$5.5 million, or 23.4%,8.3%, in MaintenanceDevelopment Services Segment Adjusted EBITDA,EBITDA partiallycombined offset bywith a decrease of $7.6$4.7 million, or 44.2%,2.7%, in DevelopmentMaintenance Services Segment Adjusted EBITDA, as discussed further below in Segment Results.

Adjusted Net Income for the sixnine months ended MarchJune 31,30, 2026 decreased $16.0$36.1 million to $11.1$36.5 million, from $27.1$72.6 million in the 2025 period due to the changes noted above.

Represents expenses related to distinct initiatives, typically significant enterprise-wide changes, including actions taken as part of the Company's One BrightView initiative.initiative, and other non-operating expenses. Such expenses are excluded from the measures disclosed above since such expenses vary in amount based on occurrence as well as factors specific to each of the activities, are outside of the normal operations of the business, and create a lack of comparability between periods.

Represents losses on the extinguishment of debt related to the Tenth Credit Agreement Amendment, Eleventh Credit Agreement Amendment, and the Sixth Amendment No. 9 to the CreditReceivables Financing Agreement, in the fiscalnine yearmonths ended SeptemberJune 30, 2026, and the Ninth Credit Agreement Amendment, in the nine months ended June 30, 2025 and includes accelerated amortization of deferred financing fees and original issue discount as well as fees paid to lenders and third parties.

Segment Results for the Three Months Ended MarchJune 31,30, 2026 and 2025

The following tables present Net service revenues, Segment Adjusted EBITDA, and Segment Adjusted EBITDA Margin for each of our segments for the three months ended MarchJune 31,30, 2026 and 2025. Changes in Segment Adjusted EBITDA Margin are shown in basis points, or bps.

Maintenance Services net service revenues for the three months ended MarchJune 31,30, 2026 increased by $61.8$9.1 million, or 12.5%,1.8%, from the 2025 period. Snow removal services increased by $49.2 million, or 28.5%, due to increased snowfall in the period1, and Commercial Landscaping services increased by $12.6$11.7 million, or 4.0%.2.3%, and Snow removal services decreased by $2.5 million or 42.0%. The increase in Commercial landscaping services revenue was driven by increased ancillarycontract revenue and contractto a lesser extent ancillary services.

Segment Adjusted EBITDA for the three months ended MarchJune 31,30, 2026 increaseddecreased by $13.2$18.7 million to $69.5$63.0 million from $56.3$81.7 million in the 2025 period. Segment Adjusted EBITDA Margin increaseddecreased 110390 basis points, to 12.5%,12.2%, in the three months ended MarchJune 31,30, 2026, from 11.4%16.1% in the 2025 period. The increasesdecrease in Segment Adjusted EBITDA and Adjusted EBITDA Margin werewas primarily driven by increaseda snownon-routine removalself-insurance servicesadjustment, higher fuel prices, and continued investments in our sales force, partially offset by increased commercial landscaping revenue described above, partially offset by increased investments in our sales force and increased snow services costs.above.

Development Services net service revenues for the three months ended MarchJune 31,30, 2026 decreasedremained $22.3relatively flat, increasing $0.6 million, or 13.0%,0.3%, compared to the 2025 period. The decrease was driven by the timing and mix of Development Services projects.

1As defined by the National Oceanic Atmospheric Administration, U.S. Department of Commerce (“NOAA”) for the Company's footprint during the respective three-month periods and six-month periods Development Services Segment Adjusted EBITDA Segment Adjusted EBITDA for the three months ended MarchJune 31,30, 2026 decreasedincreased $7.6$1.6 million, to $9.6$33.1 million, compared to the 2025 period. Segment Adjusted EBITDA Margin decreasedincreased 36080 basis points to 6.4%16.4% for the three months ended MarchJune 31,30, 2026, from 10.0%15.6% in the 2025 period. The decreasesincrease in Segment Adjusted EBITDA and Segment Adjusted EBITDA Margin were primarily driven by the changetiming and mix of projects in revenuethe describedperiod, abovepartially andoffset toby a lessernon-routine extentself insurance adjustment and increased investments in our sales force.

Segment Results for the SixNine Months Ended MarchJune 31,30, 2026 and 2025

The following tables present Net service revenues, Segment Adjusted EBITDA, and Segment Adjusted EBITDA Margin for each of our segments for the sixnine months ended MarchJune 31,30, 2026 and 2025. Changes in Segment Adjusted EBITDA Margin are shown in basis points, or bps.

Maintenance Services net service revenues for the sixnine months ended MarchJune 31,30, 2026 increased by $88.9$98.0 million, or 9.9%,6.9%, from the 2025 period. Snow removal services increased by $85.2$82.7 million, or 41.6%,39.2%, due to increased snowfall in the period1 and Commercial Landscaping services increased by $3.7$15.3 million, or 0.5%.1.3%. The increase in Commercial Landscaping services revenue was driven by increasedincreases in contract and ancillary services.services revenues.

Segment Adjusted EBITDA for the sixnine months ended MarchJune 31,30, 2026 increaseddecreased by $14.0$4.7 million to $105.0$168.0 million from $91.0$172.7 million in the 2025 period. Segment Adjusted EBITDA Margin increaseddecreased 50110 basis points, to 10.6%,11.1%, in the sixnine months ended MarchJune 31,30, 2026, from 10.1%12.2% in the 2025 period. The increasesdecreases in Segment Adjusted EBITDA and Adjusted EBITDA Margin were primarily driven by a non-routine self-insurance adjustment, and continued investments in our sales force, partially offset by increased snow removal services and commercial landscaping revenue described above, partially offset by increased investments in our sales force and increased snow services costs.above.