Margin Expansion
Q: What drives future margin lift?
A: Management explained that procurement improvements, better labor management, and operating leverage are the main drivers to push margins toward mid-teens, with Q1 showing a 120 basis point expansion and significant room for further gains across both maintenance and development segments. " "

Maintenance Organic Growth
Q: When will land organic growth turn positive?
A: Leaders expect the core land business to return to positive organic growth in the second half of the year, thanks to improved employee turnover and stronger customer retention. "

Margin Detail Q1
Q: What fueled maintenance margin expansion?
A: Q1’s 140 basis point margin expansion was primarily driven by notable SG&A savings and operating efficiencies, setting a robust trend for the year. "

Guidance Adjustments
Q: Why did noncore impact increase to $28m?
A: The revised estimate reflects a higher unwinding impact from the BES divestiture and U.S. lawns sale, with these adjustments expected to normalize by Q2 without changing overall revenue guidance. "

Development Backlog
Q: How is the development backlog trending?
A: The development backlog remains strong at around $900 million and is growing at approximately 6–7% year-over-year, underpinning future revenue performance. "

Development Conversion
Q: What is the conversion rate from development to maintenance?
A: The conversion rate has improved significantly—from below 10% to the mid-teens—helping convert one-time development jobs into ongoing maintenance contracts. "

Ancillary Revenue Trends
Q: How is ancillary revenue trending?
A: Most markets are now back to a stable, normal level of ancillary revenue, although a couple of regions experienced some headwinds, overall reflecting solid recovery. "

Organic Growth Dependency
Q: Does organic growth rely on ancillary revenue?
A: Management emphasized that both ancillary revenue and cross-selling play crucial roles, with no single lever dominating, thereby supporting a balanced and sustainable organic growth strategy. "

Labor Conditions
Q: What about labor availability and inflation?
A: The company benefits from a stable workforce—averaging over 5 years of tenure—and is actively improving retention, which helps effectively moderate inflationary and labor market concerns. "

Sales Force Investment
Q: What are the plans for expanding the sales force?
A: Although exact numbers weren’t disclosed, significant investments are being made in both new sales hires and account managers, with ramp-up linked to ongoing improvements in customer retention. "

Equipment Investment
Q: How are fleet upgrades impacting costs?
A: Upgrades in the fleet—including replacing 7,500 core mowers so that none exceed 15 months in age—are expected to reduce repair costs and enhance service quality, contributing positively to cost control and capital efficiency. "

Core Business Performance
Q: Was core performance tougher this quarter?
A: After adjusting for noncore items, Q1 showed growth in development and snow, with initial challenges in land business expected to improve in the second half of the year. "

Snow Guide Consistency
Q: Has the snow guide changed?
A: The snow guide remains unchanged at 160–200, with recent clarifications focused on detailing noncore impacts rather than altering the underlying outlook. "