RE:94% revenue increase vs 3% earning decrease.not hard if you go through all the documents. It lookslike they are putting in a lot more money back into the business (hopefully the S part of the SG&A) - results of which will show up down the line.
here is a recap from TD for those interested:
The primary variance in the quarter between our Q1/17 Adjusted EBITDA estimate and reported Q1/17 Adjusted EBITDA was SG&A, which increased by ~$8mm (~10%) from the ~$80mm quarterly SG&A reported in Q3/16 and Q4/16.
On a segmented basis, the most significant change in SG&A occurred at Service Experts, which we believe is likely the result of the company's recent roll-out of the rental program across the Canadian platform and in select U.S. states. We are concerned that this elevated level of SG&A may persist for the foreseeable future, as management noted on the conference call that, aside
from one-time items that it cited (namely ~$2mm of share-based compensation expense) and potential for slight SG&A reductions in sub-metering (which represented only $5.7mm of the $88.5mm of SG&A in the quarter), it believes that the current run-rate is likely to remain relatively unchanged moving forward.
Moreover, with the full roll-out of the rental program not expected to be completed until 2018, we are concerned that there may be potential for these SG&A costs to escalate even further.