Good morning, everyone, and welcome to our Fourth Quarter 2021 Earnings Call and Investor Day. My name is Paul Goldberg, and I'm the Senior Vice President of Investor Relations at ABM. With me today are Scott Salmirs, our President and Chief Executive Officer; Earl Ellis, our Executive Vice President and Chief Financial Officer; as well as other members of our executive leadership team, whom you will meet later during the Investor Day portion of today's program. We are all very pleased you have joined us this morning. Please note that earlier this morning, we issued our press release announcing our fourth quarter and full year fiscal 2021 financial results as well as details about the ELEVATE initiative we are undertaking. A copy of this release and an accompanying slide presentation can be found on our website, abm.com. Regarding today's program, we will first review our Fourth Quarter and Full Fiscal Year 2021 Financial and Operating Results. After that, we will take a short break. We will then begin the Investor Day portion of the program, where we will provide an update on our strategic positioning, discuss our newly announced ELEVATE initiative and provide a multiyear outlook. After that, we will host a Q&A session. Instructions on how to submit a question will be provided at the end of our prepared remarks. Before we begin, I would like to remind you that our webcast and presentation today contain predictions, estimates and other forward-looking statements. Our use of the words estimate, expect and similar expressions are intended to identify these statements. These statements represent our current judgment of what the future holds. While we believe them to be reasonable, these statements are subject to risks and uncertainties that could cause our actual results to differ materially. These factors are described in the slide that accompanies our presentation as well as our filings with the SEC. During the course of this call, certain non-GAAP financial information will be presented. A reconciliation of historical non-GAAP numbers to GAAP financial measures is available at the end of the presentation on the company's website under the Investor tab. And with that, I would like to now turn the webcast over to Scott.

Thanks, Paul. Good morning, and thank you all for joining us today to discuss our fourth quarter and fiscal 2021 results. Following our comments, we're hosting a virtual Investor Day, where we will provide a long-range strategic update and financial outlook, including a comprehensive discussion of our ELEVATE investment initiative. I hope everyone can join us for that part of the webcast, and we look forward to speaking with you and answering your questions. Fiscal 2021 was an exceptional year for ABM, highlighted by continued strong financial performance and the acquisition of Able Services, a key transaction that substantially expanded our geographic footprint and broadened our capabilities. Throughout the year, our global team continued to execute at the highest level, successfully navigating a dynamic environment with agility, resiliency and dedication to serve our clients. Fourth quarter revenue grew over 14% to $1.7 billion, and adjusted EPS increased 23%, representing a great finish to our fiscal 2021 year, where revenue of $6.2 billion was accompanied by an adjusted earnings per share increase of 47% to $3.58. Our strong revenue growth in the fourth quarter was driven by one month of contribution from Able as well as organic growth in our B&I, Aviation and Technical Solutions verticals, which more than offset a modest decline in our Education segment. I'm pleased with the progress we've made in enhancing our overall profitability as full year adjusted EBITDA margins reached a record 7.3% and fourth quarter adjusted EBITDA margins increased 40 basis points from prior year. Throughout the year, we continued to experience demand for our disinfection and virus protection services as clients prioritized our EnhancedClean protocols to maintain hygiene in high-traffic spaces. In addition, we continued to manage our labor costs proficiently as office occupancy trends increased gradually through the year. As anticipated, overall demand for our higher-margin work orders and EnhancedClean services eased as the year progressed, yet we maintained elevated levels in the fourth quarter compared to pre-pandemic. Going forward, we expect that ongoing concerns around COVID-19 variants will lead to incremental opportunities for our disinfection services, providing support for our adjusted EBITDA margins exceeding 6% in fiscal 2022 per our guidance. Turning to our segment performance. Fourth quarter revenue growth was led by a continued rebound in aviation. This industry group, which was most impacted by the pandemic, generated 43% year-over-year revenue growth in the fourth quarter as air travel trends improved markedly over the prior year and we capitalized on new business opportunities, including the expansion of our parking operations at airports. Our fourth quarter has also benefited from 21% growth in Technical Solutions revenue, reflecting growth in our emerging e-mobility business and improved access to client sites. Technical Solutions' backlog increased by 20% sequentially compared to the third quarter and reached a record level in the fourth quarter. Driven by the transition to electric vehicles and the associated need for charging stations, our e-mobility business has significant long-term growth potential. Key growth drivers for this business include federal stimulus funds designated for energy-efficient projects as well as the recent passage of the federal infrastructure bill that included $7.5 billion towards deploying EV charging stations nationwide. Our B&I segment continued to perform well as revenue grew at a double-digit rate in the fourth quarter, benefiting from the addition of Able, new contract wins and continued client demand for work orders. While office occupancy trended higher over the past year, office occupancy levels remained low by historical standards, which should lend to a continued tailwind from labor efficiencies' perspective in this segment during the first half of fiscal 2022 and possibly longer. Turning to Education. Fourth quarter revenue and margins declined compared to the prior year. Earlier this year, we communicated that the return of students to school on a full-time basis would diminish education segment labor efficiency, as increased staffing would be required to accommodate educational institutions reopening in the fall. This did occur as we expected, though the unusually rapid staffing ramp, combined with the state of the labor markets, resulted in higher labor costs, dampening segment margins in the quarter. With this staffing increase now behind us, we believe Education segment profitability will return to more normalized levels starting in the first quarter. I'd now like to provide some color on ELEVATE, our transformational investment initiative that we will discuss in detail during our virtual Investor Day event following this call. Five years ago, we announced 2020 Vision, a long-range strategic plan to drive profitable growth and shareholder value. Today, we are building on the success of that initiative with ELEVATE, a multiyear, comprehensive investment initiative that will enhance our strategic and competitive positioning; leverage the advantages of leading-edge technologies, inclusive of data and analytics; and enable us to capture incremental growth and profit opportunities arising from macro shifts in demographics, rapidly changing workplace dynamics and the heightened need for increased corporate sustainability. ELEVATE will include strategic investments in revenue growth initiatives, team member development, workforce management and digital transformation. These investments will accelerate our organic growth, strengthen profitability and create a more rewarding experience for both clients and team members. The total ELEVATE investment is estimated to be $150 million to $175 million, and the initiative is expected to be largely completed by the end of fiscal 2025. In Fiscal '22, we expect to invest approximately $80 million in ELEVATE, enabling us to significantly advance the implementation of our digital transformation. With these foundational elements in place by the end of fiscal 2022, we anticipate lower levels of ELEVATE investments in subsequent years. We're excited about the opportunities that ELEVATE will provide, and we'll share more detail with you on this whole initiative in a few minutes on the Investor Day portion of the program. We are entering fiscal 2022 from a position of strength, supported by a healthy balance sheet, solid cash flow and favorable growth trends across our businesses. We continue to support our clients by providing high-value services and solutions that have enabled them to navigate unprecedented challenges over the past couple of years. And with the recent acquisition of Able, we significantly expanded our capabilities to comprehensively address our clients' evolving needs across the spectrum of facilities management and engineering solutions. Now I'd like to comment briefly on our guidance. For fiscal 2022, we forecast GAAP earnings per diluted share of $2.05 to $2.30 and adjusted EPS of $3.30 to $3.55. Within this guidance, we assume an easing of COVID-related disinfection services and work orders, leading us to project Fiscal '22 adjusted EBITDA margins of 6.2% to 6.6%, inclusive of synergies from Able Services acquisition. While EPS and margins are projected to decline from fiscal 2021, they are significantly above pre-pandemic levels and above our targeted long-term metrics we outlined in 2019, when we signaled an aspirational margin range of 5.5% to 6%. We'll provide more detail on our outlook and fiscal 2022 guidance later during our virtual Investor Day portion of the program. I'll now turn over the call to Earl for a discussion of our financials.

Thank you, Scott, and good morning, everyone. Fourth quarter revenue increased 14.2% to $1.7 billion, primarily driven by one month of contribution from the acquisition of Able Services, continued client demand for disinfection services and a generally improving economic environment. GAAP income from continuing operations in the fourth quarter was $34.3 million or $0.50 per diluted share compared to $53.1 million or $0.78 per diluted share in the same period last year. The decrease in GAAP income reflects higher operating and corporate expenses, which included acquisition-related costs of $19.7 million, initial investments in our ELEVATE initiative and a lower benefit from self-insurance adjustments related to prior years. On an adjusted basis, fourth quarter income from continuing operations grew 25% to $58.2 million or $0.85 per diluted share compared to $46.7 million or $0.69 per diluted share in the fourth quarter of last year. The increase in adjusted EPS reflects revenue growth and a benefit from the absence of a reserve for notes receivable related to a single project within the company's Technical Solutions segment recorded last year, partially offset by reduced labor efficiencies and disinfection work. Corporate expenses were $40.9 million higher compared to the fourth quarter of fiscal 2020 due to acquisition-related expenses, a lower benefit from prior year self-insurance adjustments and costs related to hiring initiatives. Corporate expenses in the fourth quarter of fiscal 2021 were also impacted by $10.3 million of initial investments in the ELEVATE transformation initiative that Scott mentioned and that we will discuss more fully later on. Now turning to our segment results in the fourth quarter. B&I revenue increased 17.5% year-over-year to $933 million, driven primarily by a one-month contribution from Able Services, increased office occupancy and the expansion of key accounts. Excluding the contribution from Able, B&I revenue increased 4.7% from the prior period. Operating profit in B&I declined 3% to $82.1 million from the same period last year, reflecting an easing in higher-margin work orders. Aviation revenue increased 43% to $201.7 million, marking the second consecutive quarter of robust year-over-year revenue growth. This improvement was driven largely by increased airline passenger volume and the expansion of our airport parking operations. Aviation operating profit increased to $13.2 million compared to $3.5 million in last year's fourth quarter, driven by the significant rebound in revenue as well as our efforts to emphasize higher-margin airport facility services. Revenue within our Technology & Manufacturing segment was essentially flat year-over-year at $245.5 million, as new business starts were offset by reduced client demand for COVID-related work orders and EnhancedClean. However, operating margins for T&M improved to 10% in the fourth quarter, up 40 basis points from last year's fourth quarter, benefiting from efficient labor management and contract expansions. Education revenue declined 3.7% to $204.4 million, largely reflecting the timing of contract rebids. While client retention rates remain consistent on a year-over-year basis, certain contract rebids were not completed in the fourth quarter, impacting segment revenue. Operating profit totaled $7.7 million, down from $15.1 million in last year's fourth quarter. The decline in segment operating profit was, in part, due to normal seasonality. However, the magnitude of the decline this year was amplified by the widespread reopening of educational institutions that necessitated a near instantaneous ramp-up of staff, as Scott has discussed. Moving forward, we anticipate Education segment profit margins will be approximately 6% in fiscal 2022, representing an increase of more than 100 basis points compared to pre-COVID levels, resulting from a sustained uplift in labor efficiency and higher disinfection revenue. Revenue within our Technical Solutions segment grew 21% to $amount million, aided by continued strong growth in our emerging electric vehicle charging infrastructure business, improved access to client sites and strengthened client demand for energy-efficient solutions. Segment operating income returned to profitability and generated an operating profit margin of 12.8%. We ended the fourth quarter with $62.8 million in cash and cash equivalents compared to $394.2 million, with total debt of $1.06 billion as of October 31, 2021. Our total debt to pro forma adjusted EBITDA, including standby letters of credit, was 1.9x at the end of the fourth quarter of fiscal 2021. As for our dividends, I am pleased to report the Board approved a 2.6% increase in our quarterly dividend to $0.195 to be paid out in February. Now I'll briefly discuss our outlook. As Scott mentioned, our guidance for full-year fiscal 2022 adjusted income from continuing operations is a range of $3.30 to $3.55 per diluted share. Our adjusted earnings forecast reflects a favorable growth outlook across our business segments in fiscal 2022 as well as an expected easing in COVID-19-related disinfection work and a reduction in labor efficiencies from anticipated rising office occupancy rates. Please note that our adjusted earnings guidance excludes approximately $72 million in ELEVATE-related expenses that are planned in fiscal 2022. These are general and administrative expenses for delivering and implementing technology and process solutions related to our digital transformation. We plan to exclude these expenses from adjusted earnings to provide for more accurate comparisons regarding operating performance. We expect the fiscal 2022 tax rate to be approximately 30%, excluding any discrete items. Fiscal 2022 will have one additional workday compared to fiscal 2021. As a reminder, each workday represents approximately $7 million of labor expense. In terms of the timing of quarterly workdays throughout the year, we will have one additional workday in both the first and fourth quarters versus the comparable periods in fiscal 2021 and one less workday in the second quarter. Capital expenditures for fiscal 2022 are expected to be approximately $54 million, including $8 million related to ELEVATE investments. We forecast depreciation to be approximately $50 million for the year. We hope you will remain with us for our virtual Investor Day presentation, which will start shortly after a brief break. Following the presentation, we will be available to answer your questions. Thank you.

Welcome back. What a great representation of who we are and what we do. I'm super excited to kick off the Investor Day portion of our program, especially in light of the incredible results we shared earlier. Joining me are the members of our executive leadership team, who you'll be hearing from later today. This team brings an incredible mix of industry experience and diverse backgrounds. We'll share our strategic plan that will unlock significant long-term value for our shareholders and strengthen our industry-leading position through end-market repositioning and building on our core services. Our new strategic plan will transform ABM from a position of strength, using what we learned from 2020 Vision and our COVID response to launch our organization into the next phase of our journey. We're going to leverage the market trends that will impact our business over the next five years. This will not only sharpen our focus, but also inform the investments we'll be making. And we're going to optimize our portfolio of services, end markets and geographies to better position our businesses to thrive as society evolves and moves forward. And we'll innovate in the areas of technology and data to modernize service delivery. This will improve the productivity of our frontline workforce and create digital connections with our clients and our teammates and will drive profitable growth. We'll accelerate organic revenue growth rates by close to 50%, with sustainable adjusted EBITDA margins almost double where we started in 2015, while building on our significant cash flow. Over the course of the next hour, we'll dive into each one of these elements. But before we jump into our strategic plan and tell you how we're going to elevate ABM, we'll briefly lay the foundation first. We're confident that we can implement our strategic plan because we've done it before. In 2015, we launched 2020 Vision, a watershed moment for ABM, driving long-term profitable growth and enhancing shareholder value. These investments we'll make over the next few years are a direct result of learnings from the success of 2020 Vision. So let's start with a review of what we've accomplished. First, our go-to-market strategy shifted us from a service-centric to a client-centric organization and created industry groups organized by end market. This allowed us to focus on industries where we have a meaningful competitive advantage, like Business and Industry with our unmatched commercial real estate portfolio. It also gave us the opportunity to seek out segments where we knew we could build a leadership position like we did with Education. We are now clearly the #1 facilities provider in that segment. This approach was well received by clients and led to improved organic growth. Having an established industry group structure makes it easier for us to cross-sell multiservice solutions to our clients, leading to stickier, higher-margin contracts. We were also aggressive in optimizing our portfolio by divesting noncore assets like security and government services and quickly reinvesting those proceeds into an emerging higher-growth, higher-margin service line, our Technical Solutions business. Through the acquisition of GCA, we were able to take two subscale vertical markets, Education and Technology & Manufacturing, and solidify them as stand-alone industry groups. In a moment, we'll share the ways we'll continue to evolve our industry group mix towards high-growth, high-margin sectors. We also now have mature key corporate functions, like centralized shared services for finance and HR. We were able to improve productivity, and we're now in a position to take advantage of our scale as we continue our growth trajectory through synergistic M&A. A good example of the benefits of scale is how our procurement team continues to drive efficiencies in large dollar-spring categories, as we have more meaningful relationships with our suppliers. The power of this has never been more evident than during the pandemic, when we were able to procure PPE and supplies while others could not. This provided critical protection for our team members and our clients. Procurement is among many key areas where we can find synergies from M&A. And our sales culture dramatically changed through 2020 Vision. This resulted in a record five consecutive years of new sales growth, an unparalleled achievement for us. And in the field, we established standard operating procedures and a consistent service delivery approach, so our large-scale national clients knew what they can expect from market to market. To fund our acquisition strategy during 2020 Vision, we upsized our credit facility from $800 million to $1.6 billion. We also consistently increased our dividend for over 55 years. And this past quarter, we paid our 222nd consecutive dividend. We'll continue to drive growth and create value by focusing on thoughtful capital allocation to fund organic investments, pursue M&A and distribute cash to shareholders. We learned a lot through 2020 Vision and are proud of the financial results we delivered. Our journey started with a 3.8% adjusted EBITDA margin. By 2019, our adjusted EBITDA margin expanded by 140 basis points to 5.2%. Revenue grew by 23% to $6.5 billion and adjusted EPS grew 27%, reaching $2.05 per share. And we delivered these results during one of the worst labor crises in recent memory from 2018 to 2019, and we displayed the resilience that investors have come to expect from ABM year after year. We also continued to evolve on the executive leadership front. Toward the end of 2019, we made a key hire bringing on Josh Feinberg, our Chief Strategy and Transformation Officer. Josh helped guide our 2020 Vision as a partner at BCG. And now he's instrumental in developing our strategic vision and building a digitally enabled operating model. I'll hand it off to Josh now to continue laying the foundation for our strategic plan.

Thanks, Scott. Really appreciate the introduction. I feel so fortunate to be here. It's truly a pleasure to chart ABM's path forward from a position of strength, and we have a lot to leverage: our market leadership position in a large and still very fragmented industry, our unmatched footprint and service portfolio, our blue-chip client base and our industry-leading team, but perhaps more than anything else, our business continues to prove time and time again to be incredibly resilient. We were tested in 2020 and 2021 as the COVID-19 pandemic took hold. We acted quickly and decisively, rapidly building and deploying new capabilities and mobilizing our teams to lead our clients through the unpredictable shutdowns and reopenings we've all experienced over the past 20 months. And throughout it all, we performed at record-breaking profitability. So how did we do it? And how has it further strengthened us for the path ahead? We prioritized the health and safety of our team members and clients, always our top priority, by assembling an advisory council with some of the nation's leading experts in industrial hygiene and infectious disease and establishing the leading pandemic-specific health, safety and operations protocols that we quickly deployed across our client base. We laser-focused on our cash flow and liquidity. When many in our industry struggled, our cash position improved significantly. We developed our own proprietary expert-backed solutions, EnhancedClean and Enhanced Facility, to deliver healthy, safe spaces and peace of mind to our clients and their employees, so buildings could reopen and stay open. We've built and deployed a flexible labor model to accommodate the changing landscape. And we shifted our growth to pandemic-appropriate end markets like manufacturing and distribution, which helped offset the revenue decline in more impacted areas like Aviation. These actions led to bottom line profitability beyond expectation, driving our pre-COVID adjusted EBITDA margin baseline from 5.2% up to 7.3% in 2021, while generating cumulative COVID-related revenues of $600 million over 2020 and 2021. Our ability to perform during the pandemic clearly illustrates our agility and resilience. But the structural enhancements we made during this time, particularly the installation of a flexible labor model and the conversion of higher-margin disinfecting into permanent scope additions, will serve us well going forward. Our world has fundamentally changed over the past 20 months. Society's demand for healthy and safe spaces will continue well into the future, especially as new variants continue to emerge. We are confident that this will translate into long-term margin expansion, whether new variants continue or not. We have moved beyond being a trusted partner. We are now a trusted and differentiated brand. Today, we are well positioned to invest in our future and are fortunate to be launching our strategy from a position of strength. We have unrivaled competitive advantage, anchored in our market leadership across all end markets and industries we serve; unparalleled reach with a large distributed network of people and branch offices to serve our clients across the U.S. and U.K.; a unique portfolio of services, spanning janitorial, engineering, parking, Technical Solutions and Aviation services; a trusted reputation that we have earned over the last 110 years of long-lasting client relationships; and a strong balance sheet that we will use strategically and opportunistically as expansion possibilities arrive. Our performance during the pandemic afforded us the opportunity to look ahead and craft our longer-term strategy, while others struggled day-to-day. We started by refreshing our deep understanding of the market and trends impacting our industry now and for years to come. Five trends rose to the surface. First, societal shifts are leading to the demand for healthy, safe and efficient spaces as well as a renewed commitment to diversity, equity and inclusion. Changes in demographics, higher rates of urbanization and consumer preferences have accelerated the need for expanded logistics ecosystems from clients like Amazon, Walmart, FedEx and UPS looking to enhance their reach. Second, the future of work is centered on drastically changing employee expectations, which are causing employers to rethink workplace design, assess the appropriate work models for their teams and create efficient collaboration tools to drive sustained improvements in employee productivity and satisfaction. This trend highlights the need to invest in dynamic workforce capabilities and employ flexible operations to accommodate rapidly changing workplace dynamics. Third, sustainability is no longer a consideration for the future. It is required to operate a business responsibly right now. Our recently published sustainability report reaffirms our commitment to leaving a healthier planet for the next generation and beyond. More specifically, the demand for renewable energy, clean air, reduction in energy consumption and the elimination of harmful pathogens are just a few sustainability trends that directly align to our Janitorial, Facilities Engineering and Technical Solutions businesses, all of which are strategic growth priorities. Fourth, mobility is shaping various industries, leading to significant investments in autonomous vehicles and electrification, which is driving new infrastructure builds across the world. This presents a substantial opportunity for our fast-growing EV charging segment in our Technical Solutions business and our smart parking solutions in our B&I and Aviation segments. And finally, digitization. It continues to accelerate with leading-edge technologies and data and analytics becoming more prevalent in day-to-day use. Smart buildings are evolving with artificial intelligence, cloud computing and IoT sensor technology. This is leading to our investment in both workforce and client-facing technology at a time when clients are demanding innovation. Our purpose, putting people above all else and amplifying what matters most to them, has never meant more. The value and demand for what we do has never been higher. Our clients will benefit, our team members will benefit, society will benefit and our investors will benefit. We've anticipated the seismic shifts ahead. We're prepared to embrace these changes and capitalize on the future they've opened up. This is our time. Let me now pass it back to Scott to unveil our strategic vision.

Thanks, Josh. To continue to win in the future, we must build on our positioning to capture the opportunity ahead and sustain the resilience our shareholders depend on. ELEVATE is the next step in our journey. We will elevate the client experience as a trusted adviser and innovate with multiservice solutions and consistent service delivery to drive sustained profitable growth. We'll elevate the team member experience by training and developing the next generation of leaders and building on our inclusive culture. And we'll elevate our use of technology and data to power client and team member experiences with cutting-edge data and analytics, processes and tools that will fundamentally change how we operate our business and result in significant financial returns. This will separate us from our competitors that just don't have the financial resources to make these investments. We will elevate ABM. Let's take a look at the ELEVATE launch video that brings our vision to life. We are really inspired by this vision. Now I'd like to introduce Rene Jacobsen, our Chief Operating Officer. Rene is responsible for leading operations for all of our industry groups and has created an environment centered on collaboration, accountability and client focus. He's now going to take you through the market landscape, our service line and industry group portfolio and a view into how we'll elevate the client experience.

Thank you, Scott. To set the stage, we'll briefly review our service lines and industry group portfolio, then describe how ELEVATE enhances our client-facing services and drives higher-margin outcomes. As we reposition the company and sharpen our investments, we intend to tilt our portfolio mix to the highest growth and highest margin parts of our platform. We'll drive this through a balanced approach of organic investments and strategic M&A. We'll focus on increasing the density in our branch and account footprint and leveraging our national scale for the benefit of our clients. The result will be higher margin revenue and improved retention, all while driving long-term profitable growth. Let's start by reviewing our Technical Solutions business. Technical Solutions has been our highest growth and highest margin business for years. Historically, we've achieved these results with our HVAC, mechanical, electrical and lighting services, which are often bundled together and packaged in a unique offering to our clients to generate cost savings while yielding healthy margins for ABM. We call that bundled energy solutions. We're seeing greater demand for services in higher growth segments of the market related to electrification, sustainable energy savings programs and power and electrical consistent with the long-term megatrends we discussed earlier. Our team is poised to continue on a growth trajectory powered by the momentum we're seeing in the market for vehicle electrification, where we are one of the largest installers of electric vehicle charging stations in the country; bundled energy solutions, to guarantee energy savings and address critical aging infrastructure; power and electrical services that support the growth of mission-critical facilities like data centers for clients in technology, health care and the federal government. The $1 trillion bipartisan infrastructure bill that just passed will open doors for us. In fact, it allocates $7.5 billion that could be used to construct EV charging stations. We are planning investments in talent and technology to attract salespeople who could sell these complex solutions, highly skilled engineers and project managers and hardware and software to build unique solutions and integrate data sources. The revenue and margin potential for ATS continues to be very high relative to other industry groups. Investments in public infrastructure, the growth of electrification and the focus on energy and sustainability project significant market growth for years to come. Next, let's turn to B&I, our largest industry group. B&I is anchored by our commercial real estate client portfolio, which consists of both third-party managed and owner-managed facilities. Janitorial, engineering and parking are the primary service lines in B&I, which have generated solid margins and cash flow for ABM. We are planning investments in workforce management that will increase the productivity levels of our on-site operations as well as our use of technology, like sensors, autonomous equipment and data platforms, to enhance our value proposition to clients by providing real-time insights to better run their facilities. B&I fared extraordinarily well throughout the pandemic. While we sustained some top line impact due to facility closures early on and, more recently, low rates of occupancy, our margins flourished as we were able to drive labor efficiencies and higher-margin EnhancedClean services to our clients. Revenue growth potential for B&I is at a company average and remains a reliable source of organic growth year in and year out, given its overall size and impact on the organization. The margin potential for B&I continues to be above the industry group average and will be further augmented by ELEVATE investments. The market for commercial office space is projected to grow at modest rates, with the types of clients on the upper end of that growth range very much aligned to our operating model skewing towards large national companies. Next, let's cover our Education segment. Education is operating at near pre-COVID levels as schools have largely returned to in-person learning across the country. We expect both higher education and K-12 schools to continue to invest in disinfection programs while also focusing on indoor air quality. We are advising clients on different ways to pay for these services, including government funding through the CARES Act and other programs. Our breadth of services in this segment makes us a true industry leader with janitorial, facilities engineering, landscape and ground services in all markets. Our Education clients have also been a major focus for cross-selling bundled energy solutions from the ATS group. Revenue growth and margin potential for Education is slightly below company average. However, there's an upside as our team shifts focus to higher-margin contracts with private higher education institutions that have longer buying cycles. The education market is primarily in-sourced but we are well positioned to generate more first-generation outsourcing opportunities with an integrated service offering that includes janitorial, engineering and grounds. This solution was bolstered by the acquisition of Able Services. Now let's switch gears and turn to Aviation. Aviation was our most impacted industry group during the COVID-19 pandemic. However, our exposure to airports, and not just airlines, insulated us against the more severe impact as flight volumes dropped almost 90% during the peak. Our breadth of service offerings in this space and our commitment to providing healthy and safe spaces for passengers, both onboard and in airports, helped us sustain a significant portion of our revenue over the last two years. As flight volumes are returning to normal, we're also continuing to secure higher-margin service contracts with airports and related facilities, which tend to be more stable. We're an end-to-end provider of services in the aviation industry as we handle everything, from parking and transportation to wheelchair services to cabin cleaning and many below-the-wing services like baggage handling. While revenue in our Aviation segment remains below pre-pandemic levels, we expect to see continued growth driven in part by new airport parking, transportation and janitorial contracts. Over the last few years, we've evolved from 45% airport clients and 55% airline clients to 55% airport clients and 45% airline clients as airports are less impacted by fluctuating passenger volume. Revenue growth potential for Aviation is projected to be high, with the aviation sector recovering after the initial COVID shutdown. While margin potential is structurally lower than company average, we're expecting significant improvement in this area due to volume improvements and customer mix. We believe the market potential is high given the recently passed Infrastructure Bill. Finally, let's discuss some key trends in our Technology & Manufacturing business. Over the last few years, our presence in logistics, distribution and manufacturing has grown double digits. As we covered earlier, several megatrends are accelerating growth in these markets. Consumer preferences have changed. They now expect faster fulfillment without an increase in costs, which is leading to a boom in U.S. distribution and warehouse space that is now reaching urban markets. Estimates show that one billion square feet of net new U.S. distribution and warehouse space is needed to support e-commerce growth due to consumer demands. This represents more than 100% growth in these types of facilities. ABM has a strong presence in this high-growth market and its client relationships with the likes of Amazon, Walmart, FedEx and UPS, who have experienced significant growth over the last few years. Add to this, robust end markets like food and beverage, auto, aerospace and other large industrial companies, and we are uniquely positioned to compete in this growing market. Today, we're excited to announce the creation of a new industry group, Manufacturing & Distribution. M&D will replace our T&M industry group and shift our incredible portfolio of Technology clients into B&I where they're best served. This will allow us to become even more client-centric in how we deliver our services to Manufacturing & Distribution clients, who have similar business needs and are also essential service providers in our economy. It will also leverage ABM's scale to drive service excellence, increasing density and proximity of support to all of our Technology, Manufacturing & Distribution clients as well as position M&D for innovation and growth by putting our best operation around each client and focusing on large specialized client sites to give us a better chance to expand multiple service offerings to these accounts. The accelerated growth of our Technology clients with their expanded office footprint is best served by B&I and the branch network with roughly $300 million in annual revenue moving over. This includes clients like Facebook, Google and Adobe. M&D will maintain our large manufacturing clients and add distribution clients with roughly $400 million in annual revenue moving over. We have already achieved operational savings from this change, which is part of our ELEVATE-related run rate adjusted EBITDA margin that Earl will outline in the fiscal '22 guidance section later on in the presentation. Revenue growth potential for M&D is projected to be well above average as we leverage foundational client relationships with large organizations who are realizing exponential growth. Margin potential is projected behind due to the specialization required to perform service in these unique high-demand facilities. We believe the market potential is extraordinarily high given the significant expansion of new manufacturing and distribution facilities across the country. With that, we'll bring Josh back to review our acquisition strategy.

Thanks, Rene. We'll now turn to the M&A portion of our ELEVATE strategy. As one of the largest players in our industry with strong cash flow to match, we can pursue synergistic acquisitions consistent with our strategy and portfolio priorities to complement our organic growth initiatives. By making strategic acquisitions in our core and close-in adjacencies, we can add some new capabilities, strengthen our client base and ultimately accelerate our financial performance. We will approach acquisitions proactively and pursue companies with proven track records and significant synergy value in order to accelerate profitable growth; strengthen our portfolio of services and end markets; and ultimately, realize our strategic vision. The acquisition of Able Services was a natural move in our M&A strategy and checked a lot of boxes. Able service lines fit perfectly with our vision of expanding our core Janitorial and Engineering services portfolio in key markets, with over $1 billion in top line revenue, split 60% Engineering and 40% Janitorial. As our Engineering portfolio grows, so does our sustainability and energy efficiency offerings amid growing demand for environmentally responsible solutions, a key growth trend we are focused on. Able's strong engineering capabilities will help us achieve our strategic growth objectives as we build multiservice and integrated facilities solutions for our clients. Able is a really good example of what we will look for in future deals. Our ELEVATE growth plan anticipates acquiring up to $2 billion of revenue through M&A, including the $1 billion we acquired from Able, which gave us a great head start. Transaction multiples, which vary widely across our service lines and end markets, will impact our ultimate revenue mix. Future acquisition targets could range from engineering companies that bolster our Technical Solutions' capabilities, synergistic janitorial and facilities engineering businesses that support our goals to increase density and scale and other deals that enhance our capabilities in key end markets service lines or geographies. Shifting our portfolio to organic investments and acquisitions will drive significant value over time. But achieving our aspiration requires us to do more. We are making strategic investments in areas that drive more efficient and effective operations, and we will build forward-looking capabilities to help future-proof and accelerate our growth. Our strategic plan is anchored on three pillars that will elevate ABM. These pillars represent our primary focus over the coming years: our client experience, our team member experience and the powering of both with technology and data. Each pillar contains a series of strategic initiatives that guide our investments to drive shareholder return. Let me now pass it back to Rene to introduce the first pillar, elevating the client experience.

Thanks, Josh. As we discussed earlier, societal shifts are leading to changes in client demands that require healthy, safe and efficient spaces for occupants and innovation to drive a better facilities experience. This includes more transparency into how facilities are operating, analytics and insights into how they can improve operations for customized solutions that meet their specific needs and new technology that can drive efficiencies and a better overall experience. This experience starts with our sales team. Over the past few years, we built a sales culture second to none in the industry that has driven record new bookings, but we still have an opportunity to do more. We will elevate the client experience by deepening relationships with our top clients and building new client relationships by delivering industry-leading, high-value service offerings, resulting in profitable growth. We will do this by focusing on the following initiatives: build out a strategic account management function, a dedicated team that oversees our largest and most important customers; improving retention and driving growth with existing clients through cross-selling, which has averaged $175 million over the last two years; improve our pricing and deal desk capabilities by creating new structured proposal content and guidelines that enable faster responses and higher win rates, enabling ABM to grow its client base; create new client-centric multiservice solutions and bundles that focus on high priority client needs and add value to core services while differentiating ABM from the competition; build hyper sales targeting capabilities that focus marketing capital and sales resources on the highest priority accounts, geographies and service lines; enhance and standardize our client retention strategy by creating a center of excellence that enables a consistent client experience and leads to improved retention. Now to introduce the second pillar of our strategic vision is Raul Valentin, our Chief Human Resources Officer.

Thanks, Rene. As noted earlier, future work trends are redefining what employees expect from their employers, and that certainly applies to our team members at ABM. They want to connect and collaborate with each other, both in person and across digital platforms. They care about the purpose of the company and how we live our values each day. They prefer flexibility in their work arrangements and balance for their busy lives. And they want training to grow their skills and experiences with real opportunities for advancement at every stage of their career. We will elevate the team member experience by investing in additional tools, hybrid learning and development approaches and reimagining the workforce experience to ensure we are not only attracting and retaining best talent, but creating environment where it is possible for everyone to grow, succeed and contribute. We rely on a distributed workforce of 100,000 frontline team members to deliver consistent quality service to our clients. Today, we have a wide-ranging set of tools and processes to manage our workforce. That variability makes it difficult to support how each team member can be most productive across the organization. We will transform how we work together, adopting industry-leading smart processes and tools by investing in a new workforce platform with modern timekeeping, scheduling, forecasting modules providing a simple user interface that our teams can manage and access via desktop, tablet or mobile. Ultimately, our goal is to create a digital connection with our workforce to enable just-in-time and on-demand training and development, providing them with insights to get their jobs done more productively, which will deliver better client satisfaction. We expect these investments to produce significant benefits due to increased labor productivity and will also provide us with better controls to help us comply with the ever-changing regulatory environment in these areas. We are a people business. Our team members will be a driving factor in our long-term success if we empower them to inspire, lead, manage and execute. To accomplish this, we will strengthen our culture and reaffirm our commitment to an inclusive workplace. Last year, we launched a culture and inclusion council. And now this cross-functional multilevel council is beginning to help in this area. With the guidance of the council, we selected outside organizations to partner with. As a result, we've entered into multiyear partnerships with respected organizations like the Hispanic Scholarship Fund, the Afterschool Alliance and the Thurgood Marshall College Fund. All are focused on building a more equitable society for the next generation. This not only resonates with our leaders, but directly to our team members at every level. We will empower an engaged workforce through improved talent acquisition capabilities and enhanced coaching and development programs, beginning with the frontline manager. We will evolve our rewards by implementing a total reward system and recognition program that enhances ABM's value proposition for team members and drives retention and productivity. We will build stronger HR capabilities by enhancing our HR shared services center that provides team members with support and HR-related information 24/7, while we continue to evolve our broader HR capabilities. While we're excited about our vision to elevate the team member experience, we realize we're in the midst of a global labor shortage. Our teams have been keenly focused on mitigating this risk by launching several targeted initiatives to keep our client facility staff, including strategies to better attract and retain talent. This spring, we launched a rapid recruiting program that expands the reach of most of our impactful recruiting activities like deploying local sourcing teams, hosting grassroots hiring events, opening new stand-alone brick-and-mortar recruiting centers in key markets, driving incentive programs and social media brand promotion across all our major channels. These activities have driven a strong flow of candidates, and we will continue to invest in these programs across all of our key markets. Structural realignment of our centralized field recruiting model has significantly improved yield on accepted offers. This is resulting in both improved time to fill and more hires with the same number of recruiters. We expect to continue to realize staffing efficiencies as we scale these initiatives. While we've improved our candidate flow, we've also started to build additional solutions to retain our team members. We developed a predictive retention model to identify areas of the business that may experience higher levels of team member attrition. This data, coupled with strong HR and operational partnership, has led to site-specific action plans. Early results show a reduction in turnover in half of all sites where this approach has been deployed. With a solid strategy in place to keep our facilities staffed and the investments we're making in enhancing our workforce management capabilities, we feel as prepared as we can be considering the current tight labor market. Now to introduce you all to the third pillar in our strategic plan is Melanie Kirkwood Ruiz, our Chief Information Officer.

Thank you, Raul. Elevating the client and team member experiences requires us to create a digital connection that links the buildings we service to our teams and our clients. This connection will be enabled with technology and real-time data to promote visibility into facility operations and insights to drive meaningful action. This will result in increased productivity and improvements in client satisfaction and retention. Leading-edge technologies such as AI, machine learning and advanced data and analytics are radically changing the way we do business and deliver value to our clients and team members. To effectively capture the opportunities in front of us and stay at the leading edge, we must embrace these trends and develop a digital platform consistent with our market leadership position. We will elevate our use of technology and data by investing in our systems, tools, business processes and operating models to enable the following outcomes. We will engage our clients and team members in new ways to further differentiate us in the industry. This includes launching a new team member app that will serve as a one-stop shop to manage their schedules and shifts, access new training and development content and communicate with their managers and clients. By developing and deploying client-facing technology and data platforms, we can drive actionable insights that improve service delivery and our ultimate value to the client, a great example being the smart parking solution you heard about earlier in the presentation. We will expand our use of data by building an advanced data and analytics capability that will develop data products for high-value use cases, like some of the ones you heard mentioned already: team member retention, hyper targeting for sales and recruiting, among others. This will establish data and analytics as a strategic asset for ABM. We will modernize the digital ecosystem to support core activities and enable high-value business outcomes. Investments in this area will include upgrades to enterprise software like our ERP and payroll systems, along with infrastructure and cybersecurity builds to support our new capabilities. Technology, data and process will power our ability to provide best-in-class client and team member experiences. We will undergo a fundamental transformation with careful pace and cadence.

Thank you, Melanie, and good morning, everyone. I am so pleased to have the opportunity to share with you our fiscal 2022 guidance and the details of our strategic investments that will transform ABM over the years to come. These investments will accelerate our organic growth, expand our profitability and significantly enhance both our client and team member experiences. Over the next four years, we are confident these investments will drive substantial and sustainable improvements to our operational and financial performance, while improving both employee and client retention. Now before I dive into the details of our fiscal '22 guidance and longer-term outlook, I think it's important to first ground us in what's transpired over the past 1.5 years. Since the third quarter of fiscal 2020, we have experienced significant tailwinds from the dramatic impacts of COVID-19. The substantial increase in demand for disinfecting services, combined with our team's continued strong operational execution and drive for labor efficiencies, contributed to record adjusted EBITDA margins exceeding 7% in fiscal 2021. This represents a more than 200 basis point improvement versus pre-COVID adjusted EBITDA margins in fiscal 2019. Much of this improvement reflects COVID-related benefits from increased work orders, EnhancedClean and labor efficiencies. While we anticipate an easing of these tailwinds as we emerge from the pandemic, we are confident that we can retain approximately 50 to 70 basis points of uplift over the long term, as we expect to maintain a portion of both the disinfection-related revenue and profitability, along with a higher baseline level of labor efficiency. So turning to fiscal 2022 guidance. As we build upon the improved positioning gained over the past 18 months, we are guiding to an adjusted EBITDA margin within a range of 6.2% to 6.6%. This represents a meaningful improvement over our baseline pre-pandemic adjusted EBITDA margin of 5.2% reported in fiscal 2019, but lower than fiscal 2021 as the pandemic tailwinds ease and our business begins to normalize. In addition, our adjusted EBITDA margin guidance includes the initial benefits of ELEVATE, which I will speak to shortly in more detail, as well as contributions from the initial synergies associated with Able Services acquisition. As we look to fiscal '22 and beyond, we are excited about the top line and bottom line opportunities from ELEVATE. Our ELEVATE strategy includes a series of discrete transformational investments that total between $150 million to $175 million. These investments are wide ranging, from workforce management to data analytics to the digitization of platforms that will support employee recruiting, development and retention. In short, we believe ELEVATE is a game changer. It will allow for the implementation of leading-edge processes, technology and tools that will drive a higher level of substantial financial performance; and, at the same time, benefit our team members and clients by providing more digital tools and actionable data to enrich their experiences. Ultimately, ELEVATE will enable ABM to grow faster and more profitably and provide a higher value proposition for our clients. By design, the ELEVATE plan is front-end loaded as we plan to spend approximately $80 million in fiscal 2022, followed by approximately $45 million in fiscal '23 and approximately $15 million in each of the following two years. Of the $80 million planned in fiscal 2022, approximately $72 million will be a discrete expense and will be reported as items impacting comparability and, as such, will not be included in adjusted EPS guidance of $3.30 to $3.55. The balance of approximately $8 million will be included in capital expenditures. The relatively large investment in year one is necessary to meaningfully advance our digital transformation. And with these elements in place by the end of fiscal 2022, we anticipate we can begin to scale the benefits across the organization with lower levels of investments in subsequent years. Now to help conceptualize the individual components of the ELEVATE program, let me categorize the investments over the next four years in three buckets: digital transformation, workplace and people and our go-to-market initiatives. About half of our investments will be focused on digital transformation initiatives as we invest in client-facing technology, data and analytics and our enterprise IT infrastructure. We will make our technology more robust and seamless as we better harness our data to create a competitive advantage while we upgrade and refine our business processes. These enhancements will enable us to engage our clients in new ways, use our data to more effectively drive decision-making and modernize our digital ecosystem. About 30% of the investments will be allocated towards workforce management and the investment in our people. We will make significant investments in centralized workforce management tools and capabilities, including forecasting and scheduling solutions and standardized task management. These investments will allow us to deploy labor more efficiently and deliver a greater value to our clients. We will invest in on-demand and just-in-time training tools and advance career development capabilities that will not only improve recruiting and retention, but also position ABM as an employer of choice. The remaining 20% will be used to fuel our organic growth initiatives and our go-to-market strategies, including investments in centralized platforms to support capabilities such as hyper sales targeting, price optimization and strategic account management. ELEVATE will drive revenue growth and increase profitability by supporting favorable business mix, increasing client retention, optimizing price escalations and driving cost efficiencies, primarily through labor optimization. Our goal is for ELEVATE to accelerate our organic revenue growth rate to the mid-single-digit range, up approximately 50% versus our previous growth rate, with potential upside from additional strategic acquisitions. As revenue growth accelerates, we also anticipate a corresponding and gradual improvement to our adjusted EBITDA margins of approximately 20 basis points annually, starting in fiscal 2023. In summary, we are confident that ELEVATE will enhance our potential to capture profitable growth. The related investments are expected to generate $110 million to $130 million in incremental adjusted EBITDA on a run rate basis by fiscal 2025, driving a projected internal rate of return of 28%. To put this in perspective, at the conclusion of ELEVATE in fiscal 2025, we envision ABM will generate annual revenue of approximately $9 billion, with a sustainable adjusted EBITDA margin of 7%, representing a significant improvement from our baseline level of $7 billion in revenue with a normalized adjusted EBITDA margin below 6%. We are also targeting annualized free cash flow at a run rate of approximately $400 million by fiscal 2025. While these financial metrics are compelling, the benefits and strategic value of ELEVATE go well beyond financial returns. We are confident ELEVATE will be a transformational initiative, strengthening our competitive position in the facility services industry and creating a more rewarding experience for all of our team members. So with that, let me pass it back over to Scott, who will close out our presentation and lead us into our Q&A session.

Thanks, Earl. We couldn't be more excited about our future. Our industry-leading position will be rooted in innovation and technology and enable us to drive significant long-term value for our shareholders. By implementing our new strategic plan, we can ensure growth based on our commitment to transform from a position of strength, leverage our understanding of market trends, optimize the portfolio of services and end markets, innovate in technology and data to modernize service delivery and drive enhanced profitable growth. Our goal is to be a roughly $9 billion business with sustainable adjusted EBITDA margins by the end of 2025. To achieve this and build the capabilities to expand our position in the market, we expect to make investments in areas of the business that Earl just spoke about. These investments will drive improvement across several key metrics. From a growth perspective, our investments will drive organic growth rates almost 50% higher than our prior baseline, approaching 4% annually. When factoring in our M&A strategy, we are targeting an overall compounded annual growth rate of over 10%. The focus on the client experience through investments in customer-facing technology and innovation and a new retention strategy aim to improve our client retention rates to between 92% and 94%. We believe these efforts, along with our strategic account management program, could double cross-selling performance by the end of 2025. Our people initiatives you just heard about will yield lower cost per hire and reduce team member turnover, which translates to operating margin improvement. Our workforce management initiative has one of the largest paybacks in our ELEVATE program, resulting in labor productivity, which will show up in higher operating profit at the industry group level. And the impact of the digital transformation will be felt across the entire firm. As you saw, technology and data are key components of our growth strategy, people strategy and how we execute on workforce management. All the improvements that we'll experience throughout ELEVATE will be supported in some way by the investments we're making in our digital transformation. Lastly, we'll continue to lean on the protocols that we put in place during the onset of the pandemic. COVID is here to stay in one form or another, and the emergence of new variants could be the new normal. At ABM, we are prepared to support our clients' ability to stay open, stay safe and be productive. Before we start our Q&A session, we want to share a few housekeeping items. So hang in there, and we'll kick things off shortly. Thank you.

Welcome back. We will now begin the Q&A portion of our Investor Day. This is Paul Goldberg again, and I will serve as moderator. And with that, our first question of the day comes from Tim Mulrooney of William Blair.

Can you guys hear me okay?

Perfect, Tim.

All right. Really appreciate all the color that you guys gave today. It was very helpful. I was wondering if you could dive in a little bit more on your EnhancedClean services. It wasn't discussed a lot today, but what's built in your guidance basically for 2022 relative to how much revenue you've made in 2020 and 2021? I know it's coming down but, at the same time, more and more contracts, I think, are integrating this. I would love to hear your thoughts on that.

Yes, sure. So look, it still remains vital for us, Tim. It will be moderating and coming down. And we've signaled that probably for well over a year as things return to normal. But we have said that we're going to be retaining 50 to 70 basis points of COVID benefit in our numbers in 2022. So it's still there. It's just not going to be at the record levels that we saw in 2020 and 2021, but it's still baked into our numbers.

Okay. That's helpful, thanks Scott. And I don't know who this should be directed to, but this is for anyone, but would love to hear a little bit more detail about your plans to improve customer retention over the next several years. I thought it was interesting that you're talking about building back to those rates of 92% to 94%. That really caught my ear, and I would love to hear more about that.

Sure. I'm going to pass that over to Rene. But I will tell you, it's a major element in our ELEVATE program. Rene is best to answer that.

Well, we've certainly been doing well overall compared to the industry average. But we definitely want to improve dramatically here, and strategic account management is the way to go for us. We've been working on this for roughly the last 12 months, very detailed and very focused in terms of looking at our clients, not only from the standpoint of individual industry groups but also looking at how we can cross-sell into these clients in a bigger way than we're doing today. We've built a great team in the last year that really works together as a tremendous unit. For us, it's all about focus. That's the key for us. So we're improving the program in a big way.

We believe it's so important to have a team approach. What we're doing around the strategic account management stand up is going to be a game changer for us because it's all about finding solutions and remaining stickier.

Part of the ELEVATE program is specifically focusing on initiatives that drive client retention. Client-facing technology is a great example of that. That is deliberate: bringing the client-facing tools clients have been asking for for years. Delivering those tools will be a real game changer, providing a stickier solution as we provide the client base with the data they need.

That's a great point, Josh.

Thank you, Tim. Our next question today comes from Andy Wittmann of R.W. Baird.

Great. Can you guys hear me okay?

Yes.

Yes.

Okay. Great. Just wanted to dig into the margin that you guys are forecasting here. I heard it two different ways on the conference call. I heard that you're targeting a 7% margin in the out year at the end of the planning period here. But I also heard that you're going to plan on picking up 50 to 70 basis points of the margin improvement that you saw during COVID. So I guess I just wanted to reconcile what the 50 to 70 basis points is based off of. I think as I think back pre-COVID, you guys were kind of guiding adjusted EBITDA margins in the low 5s, which would give me something in the high 5s or maybe 6% versus the 7%. So maybe Earl or Scott, could you just clarify that discrepancy and maybe some of the cadence that you see unfold?

Sure. I wouldn't say it's a discrepancy. Pre-COVID, we were at 5.2%. If you add 50 to 70 basis points from COVID benefits, you land somewhere under 6% as the new normal. Then you take all the investments in ELEVATE and everything we're doing, and you add another 100-plus basis points, which gets you to about 7% over the ELEVATE period. Does that make sense?

Okay. Yes it totally makes sense. That's clear. And then maybe I just—so the revenue CAGR here is 10%, mid-single-digit organic. You get about the same from M&A. I guess you've already kind of landed half of that $2 billion with Able or a little bit more than half. So you have to find another $1 billion of revenue to hit these targets. But I guess with these margin goals that you have outlined, and maybe I missed it, but what's the EPS CAGR attached to that revenue plan?

Sure. If you look at what we're driving over the next five years, and what ELEVATE is delivering, it's about $110 million to $130 million of incremental EBITDA. Starting with this year at $3.55, over the next four to five years, we're looking at roughly a 40% increase in EPS over that period of time.

Got it. Okay. One more. Scott, over the years, we've heard you talk about investments in technology. Certainly, I think we've heard about different payroll timekeeping systems and all these things. They all seem to have a new iteration with the ELEVATE plan. So I don't know if there's a concrete way to answer this or even to ask it, but can you talk about maybe summarize what you've done so far? Because some of these initiatives have had investments already. I'm trying to get a sense of how much different the next wave of investments are, if that makes sense?

Thanks for that, Andy. I'll let Josh and Melanie address that in more detail, but in short, earlier investments were focused on core financial systems and fundamentals. The ELEVATE investments expand beyond that to workforce management, client-facing technology and modernizing the ecosystem to be at the leading edge. Josh, do you want to add?

Yes. A couple points. Earlier investments were focused on ERP and core financial systems. COVID paused a lot of that. Now, the ELEVATE investment expands those fundamentals and extends to outer systems: modernizing workforce management, client technology and ensuring we're leading the industry in bringing technology to our teams and clients. It's an expansion and acceleration of prior efforts.

Staying on the leading edge is extremely important. Technology continues to change, so we're moving more to cloud computing platforms that allow us to add updates and upgrades and stay ahead of technology. That is critical.

Thank you, Andy. Our next question today comes from Tate Sullivan of Maxim.

First, on EV charging, if I can start there. You mentioned some details with your parking customers and what you can gain in terms of electric vehicle charging solutions starting mostly with parking and then moving to other technical solutions customers? Or is it broad-based across your customers right now?

We're very excited about EV charging. It's not just EV charging stations, it's infrastructure as well. This year, we did somewhere around $50 million in EV-related revenue. We see that doubling next year, and then growing from there. The Infrastructure Bill is a catalyst as well. Rene, you want to add?

In answer to your question, we're seeing the electrical vehicle service lines introduced primarily within the ATS side, but we're starting to shift into aviation as well. For example, the project at LAX is a great example of cross-selling between ATS and aviation. We're also seeing great opportunity within B&I. That's the game plan.

And would you quantify now or willing to? I know it's growing from a small base, but is it still less than 1% of earnings? Is it 5%? Or what kind of growth relative to size?

It's small now and emerging, but it has huge potential. The Infrastructure Bill has $7.5 billion targeted to EV charging in many forms, and our pipeline is as big as it's ever been.

Separate question. With where you've come in the last two years, and it sounds like doing more work with Amazon, Google, FedEx, UPS and now following Able acquisition, do you have larger customer concentration? Do you have less? Is concentration a good thing with those types of companies? How do you look at it strategically, Scott?

It's important to have focus. Having customer concentration with large clients allows us to invest in relationships and build teams around those customers. We've had accelerated growth with big names because we can invest in those relationships and solutions. We'll continue to do that while also building business development teams in Manufacturing & Distribution to capture emerging e-commerce and logistics companies early-stage. It's a combination of both focused concentration and expansion.

Last from me before turning out: you mentioned fiscal year '25 CAGR. What was that referring to specifically?

You're referring to the 10% CAGR on growth. It's a combination of mid-single-digit organic growth and acquisitions. Able gave us $1 billion in core revenue; that opens up geographies and cross-sell opportunities. The combination of organic and M&A will get us to that 10% CAGR.

Thanks, Tate. Your next question today comes from Sean Eastman of KeyBanc.

Just going back to Andy's question on the margins. I wanted to make sure I understand the cadence correctly. So we're coming down roughly 100 basis points in fiscal '22 post-COVID normalization, and then marching up 20 basis points annually from there. In other words, there's going to be no step down in margins in '23. Is that correct?

Yes. That's correct. Starting the year in FY '21 we were at 7.3% margins. For FY '22 our guidance range is 6.2% to 6.6%, a net of about 6.4%, down about 90 basis points driven by retrenching of COVID benefits. We now actually have a new ground floor for EBITDA margins in the 6% range, which allows us to elevate. We do not see a step down going into FY '23 and expect roughly 20 basis points improvement year-over-year starting in FY '23.

To add context, pre-COVID we had an aspirational range of 5.5% to 6%, and now the new floor is above that target. That energizes the team to target 7% and potentially beyond. If you think back to 2020 Vision, we outlined 100 basis points and ended up delivering 140 basis points. We're outlining roughly 100 basis points with ELEVATE, and we believe it's feasible.

It seems like the market is worried about labor constraints and potential margin drag as it becomes difficult to restaff. We saw that in Education this quarter. Can you provide more color on the flexible labor model and how confident you are in these targets if labor markets remain tight?

Fifty percent of our labor spend is unionized, where collective bargaining agreements provide clarity on labor increases. Unionized labor is generally more stable. The nonunion side is more challenging, but we've dealt with labor shortages before in 2018 and 2019. Part of ELEVATE is investing in rapid recruiting and workforce initiatives. Raul will provide more detail on our approach.

It's been a challenging labor market. We've implemented a rapid recruiting program with outreach into local communities, churches and community centers, plus aggressive social media campaigns to reach talent pools. We're opening brick-and-mortar hiring centers in key markets, driving incentive programs, and promoting our brand across major channels. We've realigned our centralized field recruiting model, improving yield on accepted offers and time to fill. We are also implementing retention initiatives like competitive wages, training, development and career pathing to reduce turnover. We have a dedicated talent acquisition team driving these efforts, and early results are promising.

Rene, do you want to add a customer perspective?

We've become disciplined around escalations and passing on labor-related escalations to clients. On the union side, escalations are more straightforward to pass on. On the nonunion side, we've seen year-over-year improvement and focus on each client individually to balance retention and cost. We're bold and proactive about asking for increases when appropriate and capturing those costs.

Rene has been a taskmaster with the team, very focused on capturing costs and delivering value. We're enthusiastic about the impact in fiscal 2022.

Thank you. Our next question comes from David Silver from CL King.

Am I coming through okay? First, I want to say I really benefited from the contributions made by the other members of the team that we don't normally hear from. So I thought that was an excellent addition to this presentation. I'm going to start with Scott's comment near the end where you said 'COVID is here to stay in one form or another.' In many of your assumptions there's the expectation that the quantity of the high-margin tag work or outside-the-core contract services were going to moderate as we enter the post-pandemic period. My assumption is that the standard cleaning contract is going to have to change as well. What are your expectations for the standard cleaning contract or standard technical services contract? How much of the enhanced sanitation and disinfection work that you're now doing outside the standard contract is going to become embedded in a new or evolving contract?

Cleaner, safer, healthier buildings are here to stay. Surveys show employees want proof their companies and landlords provide safe spaces before returning to work. We've stated we expect to retain 50 to 70 basis points of COVID benefit in our margins, so much of the work orders will be embedded into contracts. That doesn't mean margin deterioration; to perform the disinfecting work requires more expensive equipment, PPE and training, which is often baked in at a higher margin rate. So we believe we'll keep 50 to 70 basis points as the new normal. With developments like Omicron, the narrative shifts quickly, but safety remains paramount.

My next question relates to IT development. The 2020 program had some spending, more catch-up to industry standards. The digital transformation in ELEVATE seems to be taking you to the leading edge and becoming a tool to develop revenue streams. Given past experiences with large ERP and IT projects that can cost more and take longer than planned, how confident are you in your controls and governance—stage-gates, accountability—to keep this strategic IT spend and productivity on target?

Good question. It starts with having experienced leaders who have run these programs before. I'll pass to Josh and Melanie to explain the governance and stage-gate approach.

Our governance has three components: accountability, stage-gate process and incremental funding. Every initiative has a single management owner responsible for delivery. Each project goes through a stage-gate: first a business case with ROI and metrics; then design; then testing to prove value; and only after proving value do we scale. At each stage there is a governance review. If something doesn't pass, we stop, fix it and only then proceed. We are not writing blank checks; it's incremental, controlled and disciplined.

We are using a phased implementation plan to mitigate risk. The plan includes a detailed roadmap and a robust internal tracking system and program management capability to maintain accountability and track success against milestones so we stay on target.

Thank you, David. Our next question comes from Marc Riddick of Sidoti.

First, thank you everyone; it's helpful to hear from the wider team. On the digital transformation process, how was the plan developed? Was it done internally or with outside partners? How should we think about how the plan gets maintained throughout?

A lot of the plan started from the market trends Josh described and our experience during COVID. We focused on how to digitally connect our frontline, clients and buildings. Josh, do you want to expand on how the plan came together?

ELEVATE came from four inputs: market trends, client needs, team member needs and economics. Digitization is a core tenet to make it a competitive advantage, and the plan focuses on client experience, team member experience, and powering both with data and analytics. We see enormous data from buildings and people; the question is where to apply it to drive P&L impact and leading metrics like retention. We are focused on practical use cases to create value.

A simple example: frontline workers will be mobile-enabled and linked to building sensors. If a cleaner sees on their device that a conference room wasn't used today, they can skip cleaning it and focus on other spaces. That increases productivity and provides clients with data on space utilization, creating stickiness and value.

On Manufacturing & Distribution, you mentioned building business development teams. Can you give commentary on that and other areas targeted for hiring growth or prioritization?

I'll let Rene address M&D specifics because it's a major focus for us.

There's roughly one billion square feet of new distribution space needed to support e-commerce growth. We changed from T&M to Manufacturing & Distribution to focus on large clients in distribution and manufacturing. We'll build M&D around big clients like Amazon, UPS and Walmart, focusing on large specialized sites and using the branch network to capture smaller clients. M&D is expected to be a high-growth industry group alongside ATS.

Great. Thank you, Marc. Today's last question comes via the platform and was typed in: Has anything changed with regard to ABM's capital allocation strategy and the way you think about dividends and share repurchases?

Our capital allocation strategy remains the same: invest in organic growth, pursue M&A, and continue to return capital to shareholders. ELEVATE is an example of allocating capital to drive top line and bottom line growth. We will continue to look at strategic acquisitions. We just announced a 2.6% increase in our dividend and will continue to fund our long-standing dividend program. The Board has authorized about $145 million of share buybacks, and share repurchases remain part of our playbook. With our strong cash flow and relatively low leverage, we have flexibility for future opportunities.

Great. Well, thank you all for joining us today. That concludes our Q&A session, and I will turn it back to Scott for final comments.

Yes. Thank you so much for spending the morning with us. We're very excited, and I hope you can tell how enthusiastic we are about ELEVATE and the future of ABM. We look forward to sharing results as they unfold. More importantly, have a terrific holiday season, and we'll be back at you in Q1. Take care, and thank you, everybody.

See you.