Kenneth Krause
Executive Vice President, Chief Financial Officer and Treasurer at Rollins
Thank you, Jerry, and good morning, everyone. We had a strong quarter and a finish to the year. Let me start with a few highlights. First, revenue growth was healthy, with total revenue growing approximately 10% in the quarter and 11% for the full year. Acquisitions drove 3% of revenue growth in the quarter and for the year. We continue to see tremendous opportunities that will enable us to continue to drive growth through acquisition in the quarters and years to come.
Second, quarterly adjusted EBITDA margins were a healthy 22.1%, up approximately 180 basis points versus the same period a year ago. We saw strong results throughout the income statement. GAAP earnings per share were $0.17, up from $0.14 in the same period a year ago. It was good to see the strong growth in earnings on the healthy revenue growth. And last but not least, quarterly free cash flow was very healthy, with operating cash flow growing over 20% versus the same period a year ago. We finished off another strong year with free cash flow growing over 16%.
Let's look at the quarterly results in more detail. Quarterly revenue was $661 million, up just over 10% on a reported basis. Currencies reduced quarterly revenue growth by 70 basis points on the stronger dollar, notably versus the Canadian dollar, the Australian dollar, and the British pound. Quarterly revenues were strong and it was good to see healthy growth across all of our service lines.
Turning to profitability, gross profit was 50.5% of revenue in the quarter, up 10 basis points from the same quarter a year ago. We saw a good performance on gross profit as pricing more than offset inflationary pressures. Pricing remains at the top of our agenda and we're evaluating opportunities to implement further price increases in the first quarter of 2023. For the year, we saw elevated costs associated with casualty reserves, up $12 million for the year with $10 million of that in the third quarter alone. We discussed these charges with you back in October and continue to focus on implementing a number of key programs that Jerry mentioned previously that are aimed at improving in this area. Additionally, people costs, most notably medical costs, were up about $7 million for the year. We saw higher costs in this area throughout the year. This wasn't necessarily as impactful in the quarter but was something that gradually got worse throughout the year. SG&A expense in the quarter was $191 million, or just under 29% of revenues, up $3 million from the prior year, but improving 230 basis points when stated as a percentage of revenue. It was good to see the improvements in SG&A as a percentage of revenue to finish the year. While lower advertising expense due to timing drove a 120 basis-points of deleverage, it was good to see cost control carried across a number of categories.
Management of SG&A represents a key focus area of ours as we start 2023. At just under 30% of revenue, we feel there are opportunities to drive improvement. Stay tuned on this front, but no, we are focused on taking actions that will help to improve performance in this area in years to come. Looking closer at profitability, we did not have any non-GAAP adjustments to operating income or EBITDA this year. GAAP operating income was $120 million, or 18.1% of revenue. Adjusted EBITDA margin was 22.1%, up a strong 180 basis points over the prior year adjusted EBITDA margin. As I indicated previously, we did not have any adjustments this year to the EBITDA margin. If you recall, we adjusted the prior year quarterly EBITDA margin by the impact of the nonrecurring SEC matter.
As we discussed on the last call, I like to look at the business using incremental margins, or meaning what percent of every additional dollar of revenue growth is converted to EBITDA. In the quarter, on an as-reported basis, we generated incremental adjusted EBITDA margins that were approaching 40%. When you take out the lower advertising spend I mentioned previously, incremental adjusted EBITDA margins were approximately 30% for the quarter. And even with incurring the higher casualty charges in the second half, incremental adjusted EBITDA margins for the second half were approaching 30%. This is certainly good to see. Quarterly non-GAAP net income was $84 million, or $0.17 in adjusted earnings per share, increasing from $0.15 per share in the same period a year ago.
Turning to cash flow and the balance sheet, quarterly free cash flow was very strong to finish the year. We generated a $116 million of free cash flow on $84 million of earnings in the quarter. Free cash flow increased by over 20% in the quarter and was up a very healthy 16% for the entire year. Cash flow conversion, the percent of income that was turned into cash, was well above 100% for the quarter and the full year. We made acquisitions totaling $9 million and we paid $64 million in dividends during the quarter. Debt remains negligible and debt-to-EBITDA is well below 1 times on a gross level. We were in a net cash position to finish the year. Year-to-date, we have made acquisitions totaling just over $119 million and paid dividends of approximately $212 million. Debt balances are down $100 million since the beginning of the year and cash is down $10 million, finishing at $95 million at the end of 2022.
We're actively evaluating options to refinance our credit facilities that are set to expire in April of 2024. We expect to make progress on this in the first quarter. Also during the quarter, we corrected immaterial misstatements in the financial statements. Our press release and our 10-K that we expect to file later today will include more information on these changes. But in summary, these are non-cash related items that reduced what we originally reported for earnings by an immaterial amount. By making this change, historical earnings increased by $0.01 per share per year. Let me repeat. We understated historical reported earnings by $0.01 per share per year. The immaterial changes are related to purchase accounting for acquisitions. The short of it is that the company allocated too much of the acquired asset value to amortizable intangible assets in the past. And this adjustment corrects for this.
In closing, our fourth quarter performance continues to demonstrate the strength of our business model. We remain focused on providing our customers with the best customer experience and driving growth through acquisitions. Organic demand remains robust and we are very well-positioned to continue to use our balance sheet to grow our business. The acquisition pipeline is very healthy and our strong cash flow and balance sheet positions us very well to invest in our business. We continue to focus on execution and driving long-term profitable growth for our shareholders.
With that, I'll turn the call back over to Jerry for closing remarks. Jerry?
