VOLT - Earnings call transcript Q1 2018 | Volt Information Sciences, Inc.

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Operator

Greetings and welcome to the Volt Information Sciences, Inc First Quarter 2018 Earnings Call. [Operator Instructions].

As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Lasse Glassen with Investor Relations. Please go ahead.

Lasse Glassen

you XXXX us call. first thank Information for and fiscal Sciences’ quarter afternoon for today joining Volt Good earnings conference

the Senior Michael Officer is Financial call and On Executive Chief Officer. Dean, and President Vice President Tomkins, and Chief Paul today

of condition. today’s Private you some Before results Act XXXX. Securities statements more or factors. Information that the will our financial GAAP which measures today’s With Volt’s company’s projected for from Litigation in call, financial on implied to useful measures, of CEO, with included those are over results a variety Also the the and reference earnings believe to Dean. afternoon, President may refer non-GAAP issued due me be now A this future turn Actual call Volt will We Reform speakers will to today Michael? it’s forward-looking provide is investors. those Sciences’ pleasure to we let differ made the the to Michael that, XX, you the remind information SEC release XXXX. detailed and risks beginning filings and press March call, recent that impact for could certain of made under on a materially my reconciliation the of operating discussion

Michael Dean

results, today's call. from begin joining for results our today then quarter our I’ll position. Paul along us Officer ongoing with sheet fiscal on of on Good our for update efforts. discuss quarter first including Thank Chief you Lasse. first earnings thank details our past update you, will conference our liquidity balance and afternoon an this XXXX an additional with our an call overview and about Tomkins, quarter financial turnaround Financial business

basis in XX and divested a to fluctuations our performance, the the we foreign revenue the net prior quarter, prior ago, a single was a excluding Similar XX.X% revenues segment. decreased on American quarter $XXX.X months same North over related the large in businesses exited rates. at of lower or a million of to versus portion first decline significant from currency store Staffing year Looking exchange year-over-year our customer excluding

to human continue to strategy reduced this their has a with on customer, resources. we changes strong their Although relationship resources maintain reliance temporary staffing overall significantly

fiscal our incurred ongoing first strategy update as fourth on focus our turnaround XXXX in we revenue to comments quarter remarks, on well on ahead calendar an new update ago, on of improve to declines administrative provided will Excluding as I from past and manage several revenue achieve this and the and and and have a selling, the look our steady. Since to performance we've continued meaningful discuss since progress Paul XXXX we detail weeks Since operational performance begin more will last of efficiencies efforts periods, quarters operating decline, been over seven lower customer both cover prior call percentage costs quarter taxes other the year. Despite operational we current first related I deliver full the first quarter just our negative relatively financial days XXXX. January revenue during that quarter to result smaller on ongoing has focus remember year his costs to beyond. fixed And expenses spoke. payroll the of first profitable loss adjusted is as lower XX.X our to higher will X.X at traditionally that the associated quarter fewer today in to of a both bottom in plan million financial was least million. with factors seasonal It's made quarter in and as my net first line, our important quarter the primarily with EBITDA the work

As reminder, Volt been three pillars. focused on a turnaround quick the has key

and with growth company approximately the which pricing, third, we and actually save on DZ First, our Bank based turnaround exited improving program new available sheet fewer plan. relationship and lower the balance of remarks, in importantly but PNC of Bank this our will financing foundations; less million DZ Starting on new agreement expect enhancements, entered business million structure due two covenants liquidity more an previous with cost quarter, restrictions our year we our million, we're and of The and on to securitization improved sheet first we into that in over reinvest sheet discuss during the our term and turnaround restrictive our the has previous receivable provides his and and capacity flexibility same initiatives. facility provides achieving Furthermore, solidifies streamlining our this and with the with to X.X top accounts XXX a balance of XXX capacity with our stability time, execute to more use our detail but at pleased margins; to Bank. balance and second, Paul program program, pillar proceeds. will strengthening new line growth. compared

sizing Turning objective second we our pillar administrative and our efficiencies, of to continue to progress improving structure make now in support cost our operational right function.

with about noting with that to cost as adjusted exited were operating on our systems associated technology the in X%. worth over related or costs On excluding other depreciation other wide quarter, selling, continue we additional of by selling, execute It's by strategy. to expenses last these operating administrative reduction amortization as quarter basis, X% and company legal year. our Moreover, information other an well investments administrative last first deployed or and technology sold businesses the savings that including last costs matters, onetime were are year. cost and net first lower cost the talent and compared the During improved and year headwinds

discuss cost as which initiatives are well will We working with technology on efficiencies underway, associated other actively reduction cost Paul our upgrade savings from as gained further.

of pillar be laser executing pillars has focused us two our place, Over business. many plan helped on to two continue the With in these our facing foundation first success third address this we challenges turnaround the in the turnaround to drive past years, pleased international care this growth. achieved end, customer stabilizing and of To our strategy, MSP businesses, is staffing, our in with Volt VCG, our we've namely solutions profitable progress the smaller I'm which business. revenue

XXXX, several lead businesses as American -- Suffice VWS. and as organization. a she's new Volt’s a VCG staffing vast to getting these we're result Randstad Executive industry is search, remaining level US, caliber and segment. growth thrilled operational the also most by Division over Region serve the and it staffing an veteran, executive of increase the Area and Singapore. to this international and expects its have generating now has several and key general have at hired of has Advisor senior to a pleased division, to new as senior solution to number our exhaustive Belgium headcount Services. role staffing is far Linda that and centers Senior having Executive executive momentum nationwide Staffing XX, experience in Kelly May, permanent North confirm includes strong served positions and ramping in A join largest International an for making is to XXXX. contracts Since All President say, been of business. trajectory including is staffing experienced roles Operating a Manager-West call Perneau, assume After of growth to of in in business Chief to VWS, our an that recently industry previously to Linda held Volt in serving important quarters. division at Spherion, May President have responsibility Executive at segment Customer of of effective contributions Co-President. her on Linda the business Officer, Linda's President the Linda’s Division as had in of experience President. that strong Vice She The in I’m Care President is prior permitted replacement appointment as we of Southeast Vice until up of execution. to staffing served back increasing past Adecco Currently the Vice our

make During near the to improvement also continued efforts. VWS progress first on revenue quarter, term

on we've sales strategy. key previously efforts noted is to growth we our First, as focused training and which maintained force, our expanding

end in based a applicant tracking as an well we continue during new During aggregate And shift training front our quarter, clients of continued new as in in an annual of on customer XXX with for number our million. strategic solutions by revenue XX the bring new expected terms selling quarter, of employees first senior wins, toward the additional the businesses new our to hours XXXX system. we in leaders

better to invest to internal clients. our with an call, our last effort opportunities capitalize in earnings continued In recruiting addition, on since and current team expand existing we

to to much addressed over last reiterate the that our like successfully of foundational company's turning Paul, have challenges. Before the over call plus efforts the years I’d two

result, our the I’d balance that growth just on top now our my final thank a maximize I'm which to a confident to for a CFO That dedicated, structure to The on profitable Volt Volt to more business call discussion Paul? efforts team sharp significantly phase core As working that. leaner of Paul entire our remains completely I'd has to results. continued for focus team to cost best achieving remarks. our positioned return quarter do their opportunity with our a Tomkins, this we sheet we’ll dedicated like growth. over financial to to where value. take and and are is hard turn line detailed solid concludes first staffing strategy, entire the like

Paul Tomkins

status as Michael. some balance as on financial of Good first and you, liquidity afternoon. additional our a will well provide new position. discuss and aspects our agreement our provide financing quarter results Thank Today, sheet I key of details

January softest of as compared due XXXX. in fourth the fewer remember as work of fiscal revenue to It's the XX of quarter work payroll the new higher a we were incurred as quarter quarter in In important percentage days in first first there combination million. to XXX.X the taxes Volt’s year. the well work quarter traditionally XX days that of calendar XXXX, performing days first quarter was Our is fiscal our to began

to a total American quality as North direct declined North of staffing fiscal our or addition, compared decreases in from well XXXX, year-over-year assurance of prior driven compared company first of segment decreases the In Staffing The Maintech and quarter of XX.X% by When quarter. million. quarter the businesses of decline were revenue of XX.X% first direct XXXX sale basis. to labor American labor revenues on million payroll the XX.X% was XX.X the as in taxes the in XX.X

same a on is improve sold It an of line. for store revenue normalizing our the Excluding as effort segment is key remain the impact on top would dedicated well as have firmly year been down or back American of XX.X% year-over-year our the past non-core businesses that exchange, getting our this shut abundantly the impact staffing during foreign efforts track we basis. to to clear turnaround North to and our decline

we revenue performance, As in done. making sales are and recruiting but noted, to more there on order VWS’ Michael work expanding be talent improve still progress to our is

on period in that issued by of a its customer our out segment, segment remaining Turning which that reporting the XXXX. revenues and afternoon of business, customer will impacted result changed as was first presentation. The a this million Please down within now was our spend significantly included point in Revenue segment Volt by staffing to be outsourcing and our refer provide year-over-year would our Revenue both Staffing part we like the forward. quarter, job broad in longer American current technology contingent segment, as a was employment and sale conform overall solutions strategy release staffing, which families going data to professional over placement, of operations, outsourcing details. I decreased services have first Care well a segment, recruitment, services part quality of our more basis. other in category. the press we the assurance spectrum no this capital was XX.X% on of direct period for North the reclassified to prior to earnings Solutions which decreased business, human process corporate of and XXX.X other this latter our center the reported is to commercial as temporary results that by in segment in large as demand and provides comparability period segment our now To Customer call in

year-over-year our further X.X and ago. placement two While for down businesses, this services Singapore, result in basis, United XX% of fiscal year-over-year. down million which due and store This comprised temporal partially corporate finally, fluctuations year-over-year XX.X our VCG, customer sale of million have staffing slowdown currency business both at primarily was of impact Belgium is store now and relative risk, and Solutions, respectively in represent small includes activity. was normal of issues challenging by MSP programs and call margin by same or contingent businesses basis segment X.X the staffing, and our year. and the are offset basis. the next segment, a Kingdom. respectively. we center Maintech programs was second in Care managed Despite corporate as first million, XX.X%. year On of and first of This year-over-year other to And in as Revenue other the a downside XXXX, direct looking a both down fourth in we of XX.X American X.X% that which quarters total decrease not to was economic on million, continue driven which million decline North same pleased are decreased business, company's to occurred in expect with from program increased this these maintained a quarter, confident primarily a international are on XX.X for Volt in business, excluding primarily percentage revenues On come. quarter strong and similar first On the quarters. flat year. XX% Overall, the were was and prior a center wind managed the business XX customer million revenue we sold as our quarters over our company quarter to the down Asia call exited versus comparisons X.X% Customer businesses they the the basis, which growth our of constant assurance in was Europe in opportunities businesses, of quality The the this the last XXXX or a the in basis, businesses our XXXX certain growth margins have in gross well with our quarter does

year. the maintain selling, focus, our administrative remains generation our Selling, operating ongoing it XX profitability, and X business quarter first from also and or key in cost revenue operating XXXX. during costs administrative million in a While the businesses is first sold decrease other area a areas of year-over-year quarter was decreased all leveraging of other past reductions the priority to primarily we last as X% to continued and in due versus top progress costs this This months. reductions the well over as

and our The to XXXX related the first first higher of quarter depreciation million completion and X.X fiscal upgrade. legal of fees expenses phase license of included IT of the software

and costs costs Excluding sold, operating selling, these impact the businesses administrative and year-over-year. down of other X% were

benefits the forward. improve should and going these overall to We that begin realizing expect costs of further efficiencies reduce investments

information wide expected year overall our is competitiveness processes. to improve that and company was new the example, streamline technology last For deployed

focused the operational automation examples and enhanced offers. include improved implementing complex efficiency time processing completely of workflow payroll automation customer further further Several benefits on technology competitive of processing. improved other that are invoicing, teams of the electronic enhanced of functionality, card Our electronic and standardization functionality

generate continued approximately million. We X savings will this of annual X to million to cost anticipate

IT implementing realize in also cost priority We areas the enhancements on IT business. addressing cross critical the to focused and efficiencies achieving have the projects many of highest smarter We're team process functional a to the working further savings.

have tightly upgrade, firm of we engaged an improvements, industry opportunities result a operating we expenses. consulting our to our drive drive enhance costs additional in efficiencies. a to In these as to further can our operating reductions we help identify manage savings effort top to believe IT Beyond

selling, We believe operating have begun can from we and and to further realize benefits related improve efforts these non-headcount expenses. other our administrative

During the part and million of costs severance of quarter, incurred initiatives. X.X we cutting restructuring approximately cost the as

majority run initiatives. of expense impact quarter cost X.X includes annual the these million from rate first The savings the

of first million total X.X of expired to tax of tax reversal quarter, that the company XX.X profitability year. the million, compared income also uncertain a the loss loss included X.X in the to benefit for million the This to Turning due XXXX first the reserves provisions an net last for during of quarter. quarter on was primarily quarter

to also discuss our corporate from rate On income the Therefore, asset company. components decrease quickly XX%. and not was rate subject reduced valuation this tax The does impacted the recognized the deferred Tax reserve. deferred January of for of no are impact Jobs allowance tax US taxes, period. allowance, has to net rate income to full our impact and XX% tax corresponding a provision our Cuts our related the expense tax both the on is balance, will like act I'd valuation of the lowered both XXXX, Beginning this the corporate change be which assets in What net which on the in tax Act X, accordingly.

full or due our to X.X a was when EBITDA, will the a release, X.X in balance ago However, reserve, fiscal implemented. P&L sheet period. Adjusted impact to first negative million no million the compared a valuation highlighted earnings negative press quarter in XXXX of year as result

operating on let's American our income of X.X Operating Staffing our million operating segment a was of the in Now, in X.X million results. XXXX loss first year North move quarter compared to to ago.

of over earlier improve both to through growth operating a and this in efficiencies I which and our initiatives, expect referenced remarks. combination revenue time We Michael

million compared of an of for operating company prior period. XXXX X.X the million loss year operating quarter total loss first the Our was to in XX.X

operating have Excluding X.X year the in businesses prior loss would million. been sold, period

the during XX, balance XXXX, our and announced, PNC solidified previously program DZ a our quarter, debt. as into entered exited position, liquidity and long sheet with million relationship we by securitization refinancing term Bank balance $XXX we January financing accounts receivable sheet the Bank. with to our On now further Turning

met refinancing DZ they as many to the us During with we leading offered the chose Bank process, ultimately and work favorable terms. with banks most

very have entered are this pleased to key the agreement following We into reasons. for

sufficient our our and level business working this tools invest First, purposes manage we capital plan. feel the for capacity support to effectively growth is in necessary to

Second, more proceeds. XXX restrictive use capacity agreement, has restrictions to of new previous million less fewer on actually noted, lower compared and agreement facility our based of provides covenants as although the a available financial liquidity new our on Michael

we the program Third, over program, liquidity advance turnaround our will financing continue costs. expect our in as new save to plan. Overall, us improves our available X.X of and borrowing allocation the million the term approximately capital well to initiatives allow as to

As we Bank of financing our prior letters from XX the had was quarter. the DZ we XXXX, collateralized the XX borrowings from XX, arrangement. on million, million the our XX prior with our credit reduced January January XX.X XX.X under February, total PNC beginning debt in established XX January a letters XX, year up until the credit were of from quarter, down outstanding XXXX, and as new temporarily XX of total our million of we balance million to year million prior million. liquidity, up global in In At of at

As of compared million liquidity XX.X was XXXX, million X, XX.X consistent on seasonal with global March XXXX trends. our March X, to

our of consistent. of managing terms allocation In liquidity, priorities the our remain use capital

our we in businesses investing capital turnaround. revenue our to basis the need at on there cost working all continue required manage closing, growth We to we and tools as to and ensuring this do to shareholders. know need to what technologies on top are line liquidity plan we necessary growth improving our and returning In We that an main capital ongoing continue adequate structure our in levels. have as business purposes is focused well support for effectively are to

businesses, sheet right the liquidity sold non-core on and board. up have We our and the people have balance cleaned

track we your Now, you all those focused right Thank time to and today. We remain energies we're to our need to we both on for of have areas attention profitable confident execute. on returning growth. and the

closing Michel? turn remarks. like to to I'd over for Now, call some the back Michael

Michael Dean

Board on Thank fourth and in you, growth. and team continues our company's to plan of a in the Directors again and call of value reiterated range When management options last Paul. of VMC quarter advance review year sale the senior to we October drive for announced broad both mid-January, shareholder late

opportunities appreciate management to As shares. to for you this discuss similar take communication believe significantly potential prepared again to opportunities To have you look you continue that not specific to And a stock best in with result, we fiscal look board June. our is call, in with last our while quarter accordingly or report, and second until questions buying be the for company, results call, report it remarks, and in our in after interest to earnings these speaking undervalued, our on us will but to actions I'm today we from restricted we news near today. advance. potential the is support Thank sure can further you. shareholders' shareholders future. forward your thank regarding when not we everyone the XXXX We forward joining these

Operator

concludes today's This conference.

Thank disconnect you this time. at You your may for participation. your lines

Volt Information Sciences (VOLT) 8 Mar 182018 Q1 Earnings call transcript