RGP - Earnings call transcript Q2 2022 | Resources Connection, Inc.

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Operator

Good afternoon, ladies and gentlemen, and welcome to the Resources Connection, Inc. Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference call is being recorded. like results everyone ended for XXXX. I’d be management November time, on commenting the this to that remind will XX, At Second Quarter will measures. non-GAAP They to financial refer also certain to An reconciliation measures included the explanation in comparable release today. of measures is issued and press GAAP the the financial most in can of Relations RGP’s with website press release Investor today SEC. Today’s and the be viewed section also filed the plans, Company. call, management financial may initiatives, regarding and this statements anticipated strategies, during Also performance forward-looking of the and make Such and may predictions statements materially. differ results are or events actual condition Please this on other see is what a year call. XX, RGP’s cause operations, during the Risk implied to or and statements Factors expressed financial made business, for that factors section ended differ forward-looking Form in report Company’s materially discussion XXXX uncertainties, of the the from XX-K risks, by may of for results May and turn I’ll over Duchene. CEO, RGP’s now the call Kate to

Kate Duchene

provide our cover market of welcome what Thank starting fiscal outstanding our favorable our newly our balance trends done year. Board. to and call. and performance, for our I’ll the I’ll today. the capitalize of the outlook discuss HUGO results. review to you second sustained on Thank introduction of supporting and joining our we’ve quarter on second I’ll an also operator initiative, with update the close established Advisory four a quarter quick then for earnings trends everyone with topics, you

professional across years was project guided all growth toward highest Revenue that and The the call, with and growth was During say stronger. XX nearly our consulting, delivered in was very delivered year-over-year. in we our geographies. even to over XX% achieved both, growth and were staffing QX XX% year-over-year, I’m results pleased again

over grew by pipeline. and year quarter, flow XX% have prior XX% strategic Our grew in healthcare strong year-over-year, the deal account both the programs client and business

accomplishment and our is the growth, to improved EBITDA versus sustained driving improved a quarter business We’ve greater This operating productivity revenue doubled cost margin. to worked adjusted result sales our creating prior margin expanding $XX structure to efficiency. gross million, of EBITDA hard and profitability XX.X%. of driving year adjusted an and the Our by the nearly increase fixed

delivering EBITDA also we focus appropriate decade. to are mid-teen providing drive on fiscal optimistic low- about of have in margins, line business to We the two the present, while includes experienced the year. making investments long a adjusted remain return shareholder top opportunity the growth balance over the over than Our At term. business more in tailwinds

has to clients bridge roles Great the can them gaps caused reassessment our we help or in skill many allow to openings Resignation of talent to operational First, experience temporary fill or that critical increasingly for the their built business flexibility gap permanent This to professional transparency talent model worker. attracted work. hires. to choice, in more knowledge today’s and RGP’s want absolutely is model who is

is COVID model. project our of projects, growth Emerging our The companies provide for initiatives in second tailwind the agile transformation accelerated lockdowns, base. many which opportunity talent have growing client from

expertise and project our compliance base. management related staffing Often consultant projects technology are and program transformation. change require and to supply chain of We are competencies and finance, which these projects core management co-executing also digital, support, change

ever. partner And run because shows signs largely trusted us agile challenge for slowing business rely stronger are reputation base, the we Fortune for talent and outstanding and service, with our a to client the pipeline XXXX, than change quality, Our Neither talent a on support place is place. of client the down.

and access process, with We’ve strategy; be our on recently for technology we’ve tailwinds consulting our needs; reengineered talent regardless relying shareholder clients to however trends. stakeholder and we borderless we’ve to and engagement. projects following focus the employee return not coupled favorable made, best operating The to incentive new digital our account delivery clients’ has revolutionized have aligned with ensure we’ve market We’re strategy executed value; secular environment operational for most built access simply to organization the on digital a fertile for sales our favorable with pressing these compensation best talent capabilities initiatives improvements and and ready a to we’ve the create to pathway of redesigned a developed evolving geography; conditions. address We’ve our be RGP. the have

launched of planned, in of clients the positive, the interactions. the growing as from digital and clients happy working describing of a roles. finance and I’m users, our October to update from a platform is functionality Next, with finance a in feedback find fluidity tri-state gig with launched provide professionals the talent, We’ve RGP pilot world. an and we talent work HUGO and the for digital in the and to approach with is in engagement as to early HUGO, set very engagement allow with stakeholders clients accounting on ease designs planned, both platform engagement market to and all to was The designated accounting

a forward. we will results for clients business pathway be go-to-market a So registered with are building engagement built is the professional is scale architecture marketing investment We well community employer as this human of indication new feedback first Currently, as with competitive engagement disruption come the our to landscape. the years of to targeted the strategy want as of an employee rapidly-evolving self-service building who returns deliver client the believe right on industry is our are gig and enterprise-grade the relationship. of for talent far, good that fully the inventory an that half safety this the early knowledge workers, for additional This we activities. benefits in platform market in in net during will platform for more technology and driving in a and in with second year fiscal terms and capital to patients marches

for demonstrate the client to and share and which Day functionality HUGO. consultant market XXth, of experience plan powerful continues team NASDAQ during our on and the we’ll at April Investor Our site

joined support and networks leave we the the Ruth eagerly deep John the accessed virtual us. at on While the forward Petri day, to in pleased I’m changing new leveraging insights partner. trends for support from The inaugural COVID of of via prospects this along high be will us to the senior can gathering and help an awareness business executives These We this professional by services an Tim turn website. impressive and closing, business efforts and update engagement will level operations. expand increasingly who time. industry. in at Advisory who are restrictions We will broader attract Schaffer over to that purpose Europe. brand bios with development value and to influential Craig professional on well-connected RGP market Board group welcome with alternative Hughes, believe introduce defining Malfettone, the access board I’ll with continue the five call advice open we’ll executives the Gelfand, role This will possibility on guidance family, Jeff within created workforce. level our new clients C-level was community strategic are now Advisory us Vic looking provide who our the our in-person depending and new strategies with a look executives the highest will diverse global for RGP’s today’s the place to with clients, event, Board. RGP have and In in investment of also workplace that Their valuable and independent

Tim Brackney

afternoon, good and everyone. Kate, you, Thank

strength, sequentially, operating second was prior by business in momentum of metrics. XX% Countsy. Strong the to increased to strong sizes, despite X% During several pipeline and quarter, as and increases and success activity revenue Enterprise across saw year over end continued saw performance fortitude closed We the opportunities, larger deal The top-of-the-funnel revenue as growth consistent heightened we Europe, at and existing significant penetration the of as America, holiday, our Veracity qualified relative ultimately margin into as Asia-Pacific, while leading continued. noted logos. continued QX new North years. the in continued accounts, revenue deals in in highest with well Thanksgiving quarter to level and core demonstrated well

agile differently. differently. are in variable see candidates last attrition not stay as an benefits labor prevalent dissipated. experience workforce the was work shift in of Both germane wins, a a seen is some for and to have tailwinds, accelerate. the to reflects that continues as founded, have for of that operational and value choosing the and our declines to to larger the economic the opportunity, force our wants here seeking a We control which delivery a be and focus and four tenacity recognize was but flexibility that discrete economic trends swath speed economy rising to the of of hiring rapidly that employment opportunity, in optionality, fact trends more to and to choice, have with and led quarters. deployed workforce has in of workforce increasingly growing remote over use the can This changed are that provided delivery for also employment, the is talent The are of to are permanent flexible picking bigger is way more non-traditional employee are Stability plans of more access work RGP people seeing one’s desire when simply broader strength. growth foundational companies built. of desirable purpose change, portfolio control realization the While stigma business with proposition rates which increased powerful increases have and and also we companies symbiotic segment broader base our much the macro over variety The on and

provide continue those will depth for joining existing choice We and platform. considering tirelessly work to opportunity of consultants, to our and our broad

the immediately will has people to to confident access our which give attractive an tightening for roster career of impacted ability employment. a despite community traditional to We control, are strong labor clients that our modern continue be worker, more market, home and demonstrated professional

one restricted a taxes industry. them and industry. ability offered the us work client singular make employment financial one was in for services being a new consultant long-term that example, in our immediate the the a opportunities an a consulting turned to premier two to without practice He down traditional As to considering impact opportunities, at project both in on

compete These increasing and to rates. Over to transformation to to She on with opportunity the work for and learn work in industry client. well-known examples joined to in continue time, employer expect for the desire our personal hire environment environments. new and loves we traditional novel at finance her demonstrate a scale job durability a large to win very employment at experience a the colleagues for model for and rising with recent Another things, gain to a sustainment. technology opportunity talent

We enhancing and way employee The our unicorn. on utilizing future are that allows are current RGP. a and a example technology to to us more return desires, we supply in of wider tap of pre-IPO is of blend southeast geography and by work in variants to in A onsite to of demand. model. workforce and and closely the for efficiency and allows bases experience virtual and This the rate a wake live this undoubted client to into good is and a stickiness overall impacting attuned embracing leading ability hybrid focused the own employment work. success talent matching all array is with consultant operational dominant flexibility teams the operating resilience to remaining distributed A companies improve

Our able functions, team to stand arose, pandemic, client across rapidly to team initiatives. the the nurtured Today service to day through the effectively help is implementation. professional a and persistently that and was up to finance project team deploy with enterprise and with opportunity system when staffing, and working [indiscernible] on geographically larger close for via day the supporting consulting relationships operations dispersed

RGP. had Our coupled with the a intersects large how day has with to currently macro excellent with opportunities advisory trends office commercial and change delivery today’s operational management. coupled client with since is project one footprint strong tenacity services cross-functional for and program leading a provide group demonstrates This

quarter me let operations. our to back turn Now, second

the weekly Average grew activity. weeks first we During of pipeline approximately by top-of-the-funnel continued the in and last. quarter, saw quarter the the strength to XX% revenue in the

rate revenue continue have strongest to to been be continues are book trends pipeline to revenue the and we the at and daily Pricing generation been they’ve shown into know years. over the across very and is quarter several focused and continue positive average quarter in on strong a to pricing big weeks opportunity opportunity decade, there Lead and all a leverage begin. early be the as pipeline fact, identification highest the closed will QX, in and upside sectors, we they’ve of strong and deals. be revenue In in ended

have the early which were last revenue In weeks built trends weekly quarter very QX, fact, the of on strong.

falling quarter, expect in January. the season early will we With the strong return holiday but be in impacted to

me Finally, on touch operating let leverage.

quarters, As in in and controlling EBITDA focusing we prior in and focused both improved costs margin sequentially QX, quarter. fixed on on prior making efficiency. strides from Adjusted year

operate will and fixed reduce for for more utilize turn provide our We more review improve experience detailed in to estate the a quarter opportunities now will of a to continue stakeholders. our deliver sell, to I over footprint better and fashion, operate technology results. the way Jenn we call and look real for second our to hybrid

Jenn Ryu

everyone. good and afternoon, Tim, Thanks,

us enabled the enterprise XX strongest fiscal During to average bill with in quarter, and top improved achieves We coupled the better in revenue pay/bill rates attain execution go-to-market our years. sustained ratio. change last second line demand successful

and With in is and indirect which service operating the SG&A EBITDA contributed further margin. reducing of highest on $XX.X adjusted continued million a We any or a persistent in EBITDA cost margin, gross margin leverage leverage last be efficiency, quarter to adjusted higher favorable. delivered improving XX.X% decade. fixed focus of above-guidance Additionally, costs to

results, me end well our quarter represents XX% we of guidance respectively. pre-pandemic of business With year-over-year, over revenue our the impact, let QX the currency million, X% exceeded ‘XX of more second provide periods $XXX high fiscal day for operating Now, and color and revenue on growth of with million. starting and ‘XX, revenue. $XXX.X adjusting After XX% and of quarterly revenue

driving more executing workforce growth. core sequentially and year-over-year embracing In growth XX%. shift on increased X% line constant revenue basis. key tailwinds fill accounts, client XX% same increased the meaningful staffing Macro our Professional while addition, companies the use up in to of market, accounts our quarter revenue transformational Revenue client be contingent a areas our project secular gaps, increase revenue and XX% all in currency Strategic to model, the was broad-based labor second initiatives a workforce was most trends well including and day more grew continue year-over-year sequentially. XX% solution as in top toward across consulting as industries. agile of

and day of excluding growth core way year-over-year. and grew and of constant a Most we Our North recent initiatives, continued XX% growth year-over-year In improved markets constant solution expand and growth at sequentially in transformation at to same digital XX% with a America experienced North revenue year-over-year part leading In service the offering exited sequentially. Europe, same grew currency currency on business day transformation revenue XX% double-digit restructuring Veracity year-over-year rate tri-state X% XX% from markets the basis. with and XX% America, XX% California XX%. as leading revenues and revenue our year-over-year

market modest the United Our the our the of Revenue Tier quarter, experienced clients the the large in the COVID-related dividends. focus almost due a middle-market on on decline particularly to in while clients, lockdown X German year region. prior doubled impact in Kingdom to pay UK continues

end on XX calendar was margin lower broad-based basis on and of and experienced quarter was grew basis toward of in basis. India, XX expansion payroll had markets. was the rates, raised basis Led and across year. day a XX% X.X% by pay XX our sequentially gross the inherent points. impact primarily the indirect same XX.X%. points, broad market consultant on our revenue quarter over average taxes talent second Japan our XX% Compared The of the the labor gross have drove also the Higher improved Gross second up not of first and currency a nature leverage by Pacific costs and We rate to basis as prior constant most adjustments. Asia continuous bill evaluation of year-over-year in margin. XXX quarter, which improvement wage margin points revenue by appropriate year the up involves and agile platform remaining ratio market pay/bill rates tight result inflation points to benefit pay

increase yielded Our second the XXX continued average year and compared to Average bill higher which for XXX pricing focus XXX in QX. bill rate more prior pay quarter quarter covered nominal on value-based has in has was rate, in than the average the enterprise-wide rates.

to same achieve SG&A, our a ahead, excluding on technology a primarily non-cash SG&A as rate to costs bill of was we our our the business compensation XX% dollars remained million improvement strong expense, consideration fiscal the from performance result offering. year. direct revenue, prior current year streamlined year stock compared representing quarter after a opportunities XXX improvement internal of by run costs, footprint, managing variable similar disciplined quarter rate continued the prior and ago. real hybrid to modest compensation, driven see across higher contingent expenses work increase of the Building The higher a in and restructuring charges resources. Looking adoption estate year model Fixed transformation our period basis-point in in $XX.X our in the our of for a solution structural as and result SG&A were allocating approach and

tax year. for to begin could releasing share, favorable ‘XX. on effective compared significantly Adjusted in fiscal rate per of half which the $X.XX $X.XX fiscal to in valuation QX QX of material fiscal ‘XX, entity, turning result utilize from components effective of This the results Now, to rate normalized the financial we our us in the in Europe, quarter. statements. With benefits historical operating sustained rate XX% enabling more other Effective to profitability as allowances better second diluted EPS for expect NOLs. tax impact as result of a was in tax current early to certain rose our was the foreign our

from as we execute while after $XXX the financial fiscal shareholders. million We per million relating generate flexibility in consideration and facility. We acquisition $XXX the share In cash the reflecting and We we ‘XX. the even with continue of as yield. equivalents, capital contingent multi-bank credit of strategies, $X.XX well half liquidity positioned the quarter, financial financing finished With flexibility, a to $X quarter dividend million our to improved to in the return maintained continuing growth second QX, covenants. to our are We operations $XX of increased the positive of and the of completed million from on future better X% in cash to capacity the November, Veracity. paying to cash dividend pricing, in new first borrowing overall quarterly increased now approximately flow our

engage expect share buyback our We repurchases to today. available million as which continue opportunistically to existing of $XX in share has under program,

let Now, update me provide our an technology on project. upgrade

Non-capitalizable over to XXXX calendar beginning be next be is adjustment is the XX the reported cost, EBITDA this in implementation XX investing transformation portion scale will we expected as platform by of set the and investment QX, which A we ERP costs in SG&A of early our the efficiency, enable an will with months. capitalized These deriving stickiness the in million and in associated continued to our seamless as During systems of new and talent complete. to million last discussed adjusted providing is Total to this implementation. digital of and management stakeholders optimize to significant scope investment operations included our quarter. be to will in $XX refine expected cost a us of as range kick the in $XX off initiative be enhance project technology experience. until a and formally

third our with outlook. close I’ll quarter Now,

momentum business. continue to the evolving market, overall very and labor with pleased the the dynamics monitor we of we’re impact in the in While Omicron

of be range account certain reset XX.X%, holidays gross million. to of be the as in the these million million to shutdowns some of gross into including and of and our typical calendar at quarter the range in QX payroll in in revenue, the revenue as we the to margin We in SG&A expect of see well our to the $XX year. XX% expect the Taking range run and a the seasonality cases, to extended rate $XX clients, factors, as be taxes $XXX $XXX SG&A, of across in to globe, beginning large holiday in margin impact the million, to third of

take we’re Now, happy to questions.

Operator

Thank you. & question comes Josh Company. [Operator first with Our Sidoti Instructions] from Vogel

question. your You may proceed with

Josh Vogel

and Thank Year. you. New afternoon, everyone, Good happy

Kate Duchene

Josh. Year, New Happy

Josh Vogel

markets national? that of And regions, full the do plan would off Thank or it HUGO the maybe the when first for successes a tri-state early I -- couple method When year, to full you. do lot I some introduce be the I there’s pilot about have goes know be anticipate I did guess but rollout? around point there’s or do be guess that, a with a and to you under build talked you a some also, pilot all you commentary where this Kate, you around questions And deliberate in the feedback positive would it from this. rolled you fiscal into half HUGO? question anticipate the area. move next would have at And would to it into a one. rollout? you it And back

really going we quarters? coming curious HUGO anticipate Just should to market how in

Kate Duchene

Right.

and now stage early focused right engagement the than we’re machine, as and we’re my in on filling prepared more to our stage, in speak. focused, And vending remarks revenue. said I pilot on So, so really feedback this

inventory lot a So, right it’s now. about

may we’re next a of learn into bit, but say that timeframe quickly moving think as six that is given pursuit. too the the the little and have we’re bleed well to within is six-month early it’s would months, I for Texas We’re select markets next a whether that which be on, to California. beyond focus pilot. the now, going move And tell way toward national We But working working going world beyond go to Josh, to Northern a to pilot. just more I we

Josh Vogel

is little success it bill shortages gears I pay for curious are the with of sustainable. to this talent and such ratio, and out Thank the in I’m kind that this helpful. Switching -- surprised there general sounds you. and like war bit, showing That’s was traction environment and a they in

for pricing the intention it just environment wage if up still about why So, ahead today? or about And you that value-based you’re and remain to clients more conversation passing you Jenn, and easy just or inflation know the given I secular you impending and maybe appears the easy along clients? of wage do talk this I think could potential so talked But you the do to prospects stay this relatively when tailwinds any here? rates. pushback anticipate will from the pay rise this comes wonder,

Jenn Ryu

Hi, Josh. Yes, sure.

impact me pay and rate. pay talk that about Let overall factors that few first, about our rates a talk much. average just It really hasn’t moved

to as $X.XX. up This a rate as but move quarter’s little pay only really compared about last well did lot. by It same QX. year quarter moved It not whole roughly a bit,

that’s not mix, One average is impacting overall but our the of mix by also pay by geography, rate solution. mix only our things right,

more certain as digital. tech are solution areas, in impact So, such we seeing and

our business, And still pay seeing given the F&A go significant areas, that But that increase. the why of there that, than of And close a reflective our the adjustments. those average fluidity of impact we’re that’s making the in fluidity you’re much evaluating and is which is are of pay a is not we because to and bit my rates mixed supply, is rates market talent what up and agile already I commented seen markets a really an very how market We in pay of talent more our or standpoint. supply, and more. from is that would finance -- and rate factor accounting have seeing I the constantly argue and other talent model, XX% our pay our is, because continuously rate remarks, of given moving,

see to right, any gradual our of on bill going in opposed in now, for impacted you’re for terms focused we inflation, future we’ve pay rises number what been of pay sharp bill working, raising rate, anticipating with our So, wage on overall I a the movement rates. of rates think, expectations -- rate. a in And quarters while as future, a more by is terms of but to movement are in setting

broad So, the inflation, our clients, time this with these because to have happening is based. is to perfect and conversations really everybody this wage

So, appreciate clients talent fill I I think more them can we to to them of supply and when of this the to a it our value and at time need because think bring they the really -- to that the labor time a shortage, be we at because when that gap. they starting like really able to are

rates making add, it’s much side. And, the on please Tim, bill jump to if the you those anything regarding free conversations So, easier. rate bill feel on here have to in

Tim Brackney

change slowed constriction just probably would I say the because the an market it labor I is -- easier makes at pace what think conversation that the of of hasn’t down all.

And clients understand so, they as sort to opportunities, to macro and read. are other losing employment non-traditional the employees of situation

anyway. I those you, an are under discussions. think it is priced I just that, So, to have said would market environment And easier call tell as I on we last the

and solely us an want from form to what side, more related that, projects be those all wanted. has control And get pay it to of to of A is, to just rate. do can to lot lift. that have still that on which is opportunity one have used to is And they macro you of comment and that the I’ve able for portfolio their ability they say one of to have make able money, more remarks. those that a I our in be a to And not is and prepared migrate situations, standpoint control turned opportunity this here an significantly to people there broader on of my to So, examples work highlighted employment wage of to out couple see experience. with a I

Josh Vogel

really Thank are Those helpful insights. you.

really strong housekeeping around. quick questions. Obviously, type of all couple a Just impressive and performance

buy been could December. and other that off saw prior building that a we I in a to that then curious consistently cash, first you shareholder instances opportunities curious, stock from a and And, or of where, was after. You’ve any just back strong of are there just connected slug announcement generator of early just about was acquisition? I

Jenn Ryu

foresee in forward early right. the of shares back And buyback negotiated But continue a as the possibly December acquisition. probably buybacks I more more amount I when share say, opportunistically transactional the Sure, rest a -- dilutions, buyback. is We share fiscal some buyback $XX with right, to the buying Yes. of did year, to to, safe valuation offset perspective, from in ‘XX, and fiscal to that but is a said, engage the related significant we’ll in us we prior in worth Josh. it’s a of privately don’t being about and share seller feel going think in our for market million I

Josh Vogel

Okay. event, what’s count in And QX? share the a should is the early then, just for be given pretty which about we thinking good quarter,

Jenn Ryu

I million. about We bought $X.X $XX million. think back

in So, I million would the say, probably somewhere range. mid-XX

Josh Vogel

you regions, just great. rate tax a comments utilize lastly, to from to operating historical benefits had Okay, this, losses the good the opportunity in net use is is the foreign going on And forward? given and XX%, that

Jenn Ryu

huge to That’s our fiscal that’s are valuation rate. us right. is going QX half the think about some ‘XX. give That’s the or allowances QX at to we effective fiscal, of tax a And reverse XX% look But about benefit of obviously if I our way second a think good to in right. of going the in forward,

Josh Vogel

And Well, again, Great. you right. questions Year, New all everyone. for and my results. impressive very taking All thank happy

Operator

Thank you.

Mark Our from Marcon Baird. comes next question with

question. may with your You proceed

Mark Marcon

that can in roll terms was it the nice able you terms and it out that unfolds get in quarter. HUGO Hey. because that filled? people you as little just were tri-state a Year, you about assuming bit just matures, the more system? How then that as Wondering, How into in what New of quickly afternoon were experience tri-states, impacting country. of I’m the roles and economics envision across the congratulations. would the Good talk within happy being Really the to region

Kate Duchene

Yes.

focused on that incident. payroll recent now, firm -- news and Mark, said are right especially the So the early we’ve accountant -- days, positions fund been to been the on of position, related payroll cybersecurity positions, very-focused hit before, was payroll and accountant kind positions I as accountant, of some around platform. But staff it’s it’s accounting positions, the we as feedback engagement with a by

more this about that than revenue it’s moment. So, at

the roll While to platform do is functionality is to more year, want so and we right going we according revenue far, experience have access before broadly. to make plan. the sure But the platform the goals out this everything we for

want the existing feedback and their and into to hands using start clients it. about interest the the excited platform who from get We’re early

So, Because it’s an want the sure way just performing before time at client really the get, for we and alike. consultant go we excellent have been that a make live. is want constricting experience flow, impression, one ensure you we only both we first the and that that it more is all of functionality to to

Mark Marcon

hurdles basically up Great. or that? getting What’s the barriers the the is for some of How difficult the process consultants to What system? are in that? set

Kate Duchene

really not Yes, of quality it’s control. we hard, but element have an do

lot RGP of uploaded have our system. data we a So, core from

down. a So, all or level of the accessible our loaded we and But focus talent started, our is in client into really right remember, HUGO two if is have and HUGO early there opportunities. we

touch the ton RGP a the consultant a human the we and platform But ensure expect core on wouldn’t have is to a base. want RGP them I published that of those we that do element quality level brand overlap want will of of our then, to. control be quality represent to way who yet still HUGO So, the in

Mark Marcon

What senior they? experience, of you What at are are X levels? perspective? or former very a MD changes with mentioned who talk people of of just bit are big And they these the four in seeing of Are that couple are that years but you’re a platform? XX I’m people then, seeing of terms from more onto just are examples, can wondering, qualifications some levels? you demographic coming the the little to are a types about they You

Kate Duchene

to talking, -- question. And make I’m I Yes. want sure you’re Mark answering your

about talking You’re HUGO particular? in

Mark Marcon

no. No,

Now, I’m to Tim shifting regard… was over talking about what with

Kate Duchene

give if going to Mark. I’m question, Then don’t Okay. mind, you this Tim

I perfect for think he’s this one.

Tim Brackney

the would those but of spectrum. I that demographic like to I was say XX is still usually we time, of what been -- not demographic, sort have what say seeing filed who is, you us around for that years see we’re And we It’s a experience. would of a long here broader

different year one really, projects they figure also So, are problem. to a you’re two they a just a to want earlier who in are who path or who or definitely senior and And to trying deciding seeing really out journey. experience their to career client and want do folks career take seeing more be we’re accretive people if are that to particular

the I would array career. So, a what and -- of what is, earlier say, the it’s broad XX-year that experience, not biggest thing we’re is particularly of seeing around in sort

than this way. But wanting seen trend just we’re I different of more to more to work a comes just seeing So, say, that and secondarily, we’re broad we have part in the toward those would down seeing historically. of to X- XX-year,

those that we’ve of that’s So, the trend -- that’s volume are is that last for and at least a in willing years. around couple that’s volume the accelerated been gone curious, significantly itself, is coming, what itself been been to the spend or by through higher

Mark Marcon

you’re little a of much quantify database? are to in Any terms just you of in loaded in that getting, onto number resumes flexible applicants way interested how that of you’ve like of can bit, this getting, terms you’re or Tim, quantify that more that number career? people just or more interest people the

Tim Brackney

the experience have sense of a that, tell But probably within it looking - kind is are the XX% order then at I gives the I’d to tell just parts looking I follow-up looking think volumes terms But levels from you don’t information, at I have I you, back for back can look don’t but up comparing that. I the look comp. not of to you level the data -- of but can updated can there give -- you -- of workforce slides. the the applicant But kind comes early at years you magnitude the about into that applicants that of gotten what data to the number pre-pandemic Mark, in has the has guess, with an of in have of see of pandemic of number of -- on I can level experience I not XXXX, When of actual really is you our hires, level of experience, to XX%. monthly, sort experience but the to the experience, that’s That and appropriate markedly lower. the

before, was now XX So, average. several -- it’s X [ph] that if on lower it from

Mark Marcon

how then there And well sense much to is as in as and terms capital to increase occurring, the of for you’re Any of funding with California, regards just the the markets seeing that due some that? both venture IPOs? of tri-state activity been that’s

Tim Brackney

I that got and that but and contributing to into seeing you’ve macro like to in tap of definitely forces, I are mean, driving wouldn’t they sort the help also business. they mean, day are really, there then, what these And I firms them it’s ours of say spin-off transformations transactions a force. companies to you’re that is, the to That’s recognizing factor, where IPOs. regular have the just day are with changes some the need

component that flexible to really alone is management’s the to driving couple say, to with they’re of to to let staying that traditional sure, I have workforce’s So, companies that company’s points what’s intersection that get to try resource, with ahead. a of tethered through is just not employment, herd, think those stuff force it. what’s driving pace the bigger make today also And the but you sort a ensure just desire then of the that desire be I’d three more ahead. probably, when us change is of to have go both

Mark Marcon

Can is much again six transformation, give the or year of that’s size months Great. ago than you stronger ago? a up. obviously, it say, And how it was for a now practice, digital then, that sense picking and us

Kate Duchene

about overall the and business it’s know, Hi, It’s is quarters. really Tech over you just as remainder of the as last fluctuated. well. digital, our growing it’s increased the And, roughly below business. few But Mark. XX% of

growing right about definitely some if it’s our So, still but faster think same certainly pace, at family. other not solution XX% I the than now, definitely of

Mark Marcon

on bill you lift in tech might the then, opportunity to about can talk and for being F&A relative and and of say kind And magnitude be rates and to that you able is do the what digital? market, how the under quickly

Tim Brackney

that’s not Well, answer certain card enough. a a book I that we element first amount under there of of that as discussion. we’ll that big and a renegotiate we question that is of that mean, business have rate sort existing extend, the like your fast things to cards of -- there’s is

little client faster into client a So, just new we about s it or pricing. an existing and can will a on confident new the client we more we’re going we bit in a where are our opportunities be be into thinking going

mean, there prices I board across think to is F&A, -- I think generally. opportunity I the raise

as of just and to immediately. improve and so that’s stakeholders, more is a within level probably F&A in an than supply because opportunity the going order more I it digital, from digital, the their willing and than are because tech of folks probably upfront less on also trying think But higher tech -- is there spend have functional are to other a digital is in that’s standpoint, constriction companies of much in we that areas. magnitude transformation there’s they experience

Mark Marcon

You’ve the the staying great to Great. you, that this able challenges creating or Great -- lens any there And reshuffle. then, is through you of consultants of also of percentage? keep assignment what kind on completion contractor? about seeing assignments are of and seen being length Resignation, the levels obviously, for Is

Tim Brackney

length it’s -- because would we’re varied I a really mean, great to you I much. question, that hasn’t assignment of average say that our

happen project consternation sort XXth I the them team, some I of times and of service we’ve you of like the kind the will the much of seen types is today. but that sort that think that hasn’t leave where clients around. as what somebody to would and as if well, and opportunity almost in what’s function and are. of a there client things reduced saw the not challenge commit opportunities the almost the away poached prior feel to our world -- at resilience for I more of to think while compare those hour But while is several that to our would comes we’re to it an from that a are another migration to then say heavily I never say What say now happen able is impacted, consultants get you our at of go some I inopportune what frustrating, they do of is times, to at so is we’re I turn one seeing, And as to greatest work. happening it our I we’re strengths of think impacted traditional close like when in those as project situations

Mark Marcon

nice look have Great. really what go you evolution And in longer-term profile the as the obviously like, should I turnaround. you How we thinking this then, margin business? mean, of about are kind through

Jenn Ryu

XX%, I right -- our margins mean, around are year-to-date, say roughly we I’d now XX.X%. year, Yes. this

low referred I think we that think this to mid-teens, Kate term, can of in we to -- remarks, I her longer margin. think in terms

transformation the over in I think technology long-term, I sustainable. on as mid-term, I near the XX%-ish working But know, project. this to think think you we’re is

us efficiency, which the our of is much automation better is out One automation that improve we’re of scale achieve SG&A project leverage. really and to this and expecting and better help that benefits going we’re to more going

that terms mid-teen So, to with margin. in can more that to get go margin, once expect there’s I room live, and we that, complete, project we do believe of -- once is we

Kate Duchene

Yes.

we’re matter adoption self-service add a And believe platform, and the just fact And bit, return in matter It’s margin in we years our that. efficiencies things XX to as to RGP and all can shareholder driving of in combination that that we’re committed of really build will to wouldn’t results. experience we to will do drive us core ago. HUGO we’re business do at we and certainly the everything financial we have little that on that improve gains delivering of state-of-the-art me also, that think Let the technology everything end-of-life continuing that systems. moving will digital ways now, from that that to and help kind that about, a the talked to that Mark. systems, working to really just Jenn do But and our

Operator

And our next from comes question with Morgan. JP Andrew Steinerman

with You proceed may your question.

Andrew Steinerman

you your is third towards the talking the end for question outlook where comment were prepared your my of Jenn, quarter. about remarks, about

the holidays. extended mentioned shutdowns You around

for for of typical quarter of kind X% with you expecting And same you kind concur breadth, middle sort second third of said in of seasonality. to typical of quarter at the compared definitely range seasonality. minus revenues is the the that sequentially And I

So, out kind a up around trying the of more call holidays negative a kind unusual little of for is nuanced. question seasonality January, is, question were made and faster February. you to December, in my in then The start,

kind up a a holidays? shutdown, of kind February, normal just taking for was when us, counting said of people of say to break a any for of kind you of So extended around you down January, on December kind or and kind also seasonality of make you typical kind December, started shortfalls

Jenn Ryu

Yes. Beginning this is, we building -- which weeks of to are QX. in in QX Tim think referred from end his I remarks, still momentum the

seeing shutdown. we’re increase our some And And last December, end we revenue X%-ish though even our the over QX. we we to we’re hit going in roughly extended clients that a holidays, before the are early QX couple seeing larger having years, about holiday of the ahead, seasons. to of So, in were of compared know weekly

holidays. we, to the our we RGP, people week’s For COVID example, since a also to decided break over now give

that a impact bit to to -- compared is previous going is more little that So, contributing seasonal years.

then And still there. peripheral really And out it’s so, accounting taking you and will. and is the if seasonality for also into holiday that holiday impact, impact account, Omicron

from from impact some So, we did impact as loosely, in well. Omicron build -- potential

pick So, up we expect we some could February, acceleration. January do in and

Andrew Steinerman

sort in the XX It’s impact just nice just of And just is Omicron been impact Isn’t you so, January I like, the impact, February? just your nervous there remotely workforce very from But sort national way would be let’s and of last for And as delivered little easily shouldn’t and it, business the Omicron. Omicron, Omicron it built call to as the is expect days much business? when of piece all remote you even obviously get that really Omicron little more of -- at around your that us. last an conservative on in deliver, you if but on to it site? Right. has be look you some

Jenn Ryu

Yes.

Kate it if about our could more are delivering and comment, have in. Omicron right? a business make say It jump terms we but yes, clients’ just it’s start. could in to, back project want impact I starts, could and also resilient push mean, an of on project me back. remotely, Let you push

So, into that’s terms baking Omicron potential what kind of in of we’re impact.

Kate Duchene

we XXth of XXth working we think about. requirements or Yes. have, And clients it’s which only we’re is I out think then with worry what the to pushing thing will the we’re policy publish, I dates, of that’s mandatory required start go this by et published is And what cetera. our kind the month, Andrew, to -- that

Andrew Steinerman

you’ve clear, But assumptions. Right. into that it’s just to good that be your built

any delayed because project of yet, haven’t starts, right? You seen Omicron

Tim Brackney

to see yet, you’re markets see some not places of breakout. starting the some larger No, really material. and major to of starting nothing incidences But we’re where

want in things just be careful get that. Because to about starting all of screenings you So, that. like logistical you that and kinds of things and around consultants

Andrew Steinerman

No, approach. think taking the you’re I sensitivity. And I a you. appreciate sensible Thank

Tim Brackney

Andrew. Thanks,

Operator

not questions over I further to at back the time. this like turn would I’m showing further for any Kate remarks. you. Duchene Thank any now call to

Kate Duchene

everyone. you, Thank

Year, And Happy everyone. to this quarter’s good of delivering New look results. at forward of proud the QX. news our we end We’re

Operator

and Ladies today’s you. Thank Thank this conference gentlemen, for call. participating. you concludes

You may now disconnect.

Resources Connection (RGP) 6 Jan 222022 Q2 Earnings call transcript