CCRN - Earnings call transcript Q1 2018 | Cross Country Healthcare, Inc.

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Operator

Good morning ladies and gentlemen, and welcome to the Cross Country Healthcare Earnings Conference Call for the First Quarter of 2018. This call is being simultaneously webcast live. A replay of this call will also be available until May 17, 2018, and can be accessed either on the company's website or by dialing in 866-443-8011 for the domestic calls and 203-369-1122 for international calls and by entering the pass-code 2018. I will now turn the call over to Chris Pizzi, Cross Country Healthcare's Chief Financial Officer. Please go ahead, sir.

Chris Pizzi

morning good and you everyone. Thank morning With Bill Chief Officer, our and me our this Grubbs; Burns. Chief Executive Bill is Operating Officer, call of press discussion as This our financial include a quarter the of include results second for XXXX quarter a of discussion disclosed and release first our outlook will XXXX. also in will questions. After remarks, will we our open prepared the lines for release A available on www.crosscountyhealthcare.com. our at press is of copy website our

constitute need we on to remind statements. certain that made may begin, you this statements call we forward-looking Before

to with per its financial As measures any and obligation measures known non-GAAP statements and other actual risks, Form adjusted noted or EBITDA in encourage release, quarterly undertakes vary of can to as Such the reference Also, earnings non-GAAP adjusted forward-looking comments forward-looking of during are not information would financial teleconference such superior and reports report contained no review financial XX-K you other in update share. our all are well U.S. company made factors documents. press on the for, press our calculated materially this from substitutes as and The to, annual company's non-GAAP filings these factors, with SEC. related listed provided the be GAAP. is in or uncertainties accordance to and information in contained results additional including measures More these those to in XXXX should measures subject considered financial release. statements. risk XX-Q I Form as on as in unknown

acquisitions divestitures periods start at forma to had transactions giving trends, facilitate as we in call, though impacted. of the refer and understanding the to this on to underlying the order Lastly, effect information of pro a better occurred may

the I results call X, Officer, quarter turn the Chief our that, in of XXXX. reported XXXX, As Executive RN With a of effective have operations included we Bill Advantage results our will with and been the beginning its completed Grubbs. July over acquisition now to the reminder, third

Bill Grubbs

us expectations. full to us on this we you, originally revenue the good believe reporting show Thank to still adjusted year and the management, EBITDA X exceeded year-over-year for quarter anticipated Chris. us, cost start than financial we stronger strong Thank good do, year. a have a The foundation gives though improved all in work a our and was year This for improvement our everyone of growing even the morning. to build joining segments our for results in starting with you some we off will

I of of each Before in our into pullback more for year. update want detail a certain going billable from hurricanes a came and we hours a the business. renewal lower September, percentage of in the rate an impact on headwinds or rate lower last fourth from on large faced the quarter on businesses, customers, headwinds The spend to the provide of premium

like travel from to start previous these Let's Both nurse grow travel base step of for nursing, to rates. on out hurricanes from a in renewal it historical nurses nature this change the in impact to reduced. the the while number the the and of of events nurse reduction takes of levels be Because a back occurs. travel billing when resulted with

that progress is I was wait the originally going color I first to expect Q&A think but we've the impact probably talk the here second to the in we've in hurricanes not the also quarter. Now, until and we half about Therefore, adding the return spend full obviously to to previous the to in travel an specific event the numbers customers the year. any the impact of from from related isolated nursing pullback and seen levels was important. by further made,

some over for we and go endpoint had nursing. numbers travel numbers RN billing data of So period are I'm what on variance these of to the the based going

end the end out to than quarter. had we billing at quarter to big that quarter from we year $XX that end to you at average, quarter a travel stayed drop, reduced you third of one almost per the That's from change significantly start it more a impact stayed level, nurse have So had full of of from year beginning dropped if that the $XX on us, forward end million with been would XXX million not level. in the impact the quarter. next. the of we a if about $XX would assignments the last If million the and see big of the the that's QX, fourth going that's a quarter, normally or then That's for reduced

the we I we were we first quarter. where Now, at the next had and a before. in over second to of we to quarter believe in behind months get in XXXX we're quarter, grow the about dropped so the able what to at half get expected back or the four QX, to levels about point it three it bottom be back that go QX and as fourth half to continued end the we short we'll months month of we had just into be, of but half have about of of from four first of the throughout hoped grown we've

So that I the wanted to we impact color and were. give to where as

news the from The really is averages it quarters, continue into QX. what So to do of the we'll that endpoints of normally through we is starting each the as really we each and back go continue and in we publish, that grow about about which the QX the points is quarters. it's good to not of

range million in expected which was our headwinds the did our premium in QX, rate billable and we assignments. our the hours a business, about rate in another to was QX into of $X in It back moving anticipated, percentage the Now as premium came built decline guidance see it within from impact.

new be but is business the decline in which it In our each pleased chief for branch restructure will nursing be and decision-making. half. in business quarter us business. to focus more in travel million operations again in new we on into heading guidance another new rate to designed another provide business officer premium new second and our The quarter a and into give leveling businesses by a impact. The continue premium also a president splitting us well allows responded may the expect focus two, up has with to this have that on renewed We new seems or operations productivity that's leadership improvements changes have to nimble creating We see several the and not a about I'm January, built improvements. the is made structure $X team. a efficiencies day-to-day will it role decline the second sparked and with off Cross and staffing operating progress management I'm very believe we confident announced major to Country initiatives and our additional being impact rate operational

to bolstered Turning quarter, acquisition. to growth the forma grew the Allied mostly mostly negative, business earlier. Pro was our X% headwinds discussed the due by Nurse RN Advantage and year-over-year,

positive some trends within exist However, segment. the

year-over-year. X% business Our travel was allied up

by of the nursing a our more aided underlying partly travel through strong, from remain MSPs. flu trends in small of While the positive inclusion season, impact our

to year-over-year growth. well XX% business with continues Additionally, our perform school DirectEd over

XX% to our to than QX RN our number And by to business continue from We strong had MSPs quarter, outperform acquisition out increasing Advantage increasing of more the MSPs billing sequentially at another after expect market XX% the our nurses lastly overall. supporting QX. this on by

improve As even we continue this before, and to further can momentum in XXXX. stated believe on we this we build

physician assistants XX% Advanced revenue Advanced grew to by practitioners over growth had year-over-year. staffing, performance Practices strong physician Moving Practices. includes by which slight and nurse we year-over-year driven in

four to increased exit two growth area and the ensure this making see a we last Contribution to physician strong year-over-year to improve XXXX. we for has further maintain of staffing and expect revenue margin continue quarters. of We Physician we growth. staffing as seen X% investments demand are that target also year-over-year contribution slight to with income for margin XX% this in

business this we to the a we in Although to on path some see good revenue believe growth coming is fluctuations in expect recovery, quarters.

QX year-over-year show we we'll this strong get making the increase. that because have end said, back That are believe we quarter for growth to revenue sustainable us. of we slight year. being was Specifically decline a expect in and expect a progress will QX, by year to revenue Overall, full a XXXX revenue the small

had XX% business Capital segment and search Our of year-over-year. growth is Management strong executive Other Human revenue our which physician Services

we Although the cost to have expect our income as by good and search strong predictable $XXX,XXX. as staffing improved Through business, business our year-over-year contribution leverage a we controls, XXXX. not is

by our led business MSPs, to programs, continues do managed Workforce Our services well. Solutions our

quarter almost $XX business million new winning XXXX, and XXXX. in new million $XX after MSP of million have we MSPs For our the XXXX of in secured business first $XXX of in

Although we we MSPs saw already talked to headwinds implemented. spend to still I $XX in about, have at from the in the approximately ramp fourth pullback programs quarter some existing million related

of revenue expect million the have rate to and continue from impact working the two we XX% in Capture won growing at time wins, will first to are we to this us quarter for first $XX that the remain new business. to on this in the be capture of in one areas MSPs. rate for of new Besides implemented year. business in demand our the first grow key Additionally, our to believe expected the and growth improve is throughout XXXX. topped continue MSPs XXXX is a year revenue We and quarter years improve to our positive sufficient

travel had the mostly still to the we some in overall a year have to in the quarter overcoming from XXXX fourth nurse. of work do While good start headwinds we

increase last to we in back have We quarter the initiatives year. the headcount, levels had third of several billable getting our to

in in With review call of run-rate Even half second will pleased and the stated EBITDA these who me significant to adjusted second our an Bill revenue had our margin supports a impact segments over a adjusted we our achieving X% turn have the more quarter target expected year. EBITDA. fourth and operational our I showed reporting on start support will XXXX. little nurse in we improvement The let quarter for improvement by challenges, half Burns second a with am the and our growth I All performance. the strong As expect travel focus with of detail. guidance to meaningful start the initiatives the that,

Bill Burns

Thanks Bill.

is opportunities quarter, for and achieving efficiencies As identifying on I growth driving mentioned operational improved productivity. revenue and last my focus

I as share. for increase and business Over we encouraged that market last continue of ahead with lies opportunity by our of large months customers. the several the spent several visited the the us our grow each businesses and working I to time remain

Let me start with revenue growth.

for we expectations Bill As the exceeded mentioned, our quarter.

the impact the as the from basis, Travel due of on growth. healthcare nurse some the impact Now to I'd in on the Advantage share travel the a shift opportunities the little allied, of orders. areas to the practices drivers a as to down like that's a in due as premium professionals of pro We RN accelerate and number the nursing in advanced a On [retained] was strong from mix well search. key moment billing, healthcare revenues saw of ago, year-over-year color out education in forma mentioning impact which mid-XXXX. acquisition reported growth well was more some growth were year-over-year Bill staffing, rate to lower travel as

off business the mentioned to the the we headwinds moment slowly due a So started ago. year

sequential the ability increase opportunity weeks. due as as of as market Travel assignments, fast the strength the capture throughout to from grow proactively continue the had throughout of the healthcare quarter managed rates progress our most to our managed service risen demand these largely proceed and during to faster programs. the than number quarter and our the of remains the second to to quarter, XXXX we continue or steadily programs nurse growing have We to professionals spend in significant half we and improve also of we into will coming year. which of schedules in their we should and our showed out in throughout both MSPs activity Renewal which fourth the year. that on level rebound fills with progress first the in at improvement second The to lag notably improve To quarter the RN point, Advantage and will continued but declined as we billing. a as in continue believe

will anticipate we impact and multiple at candidate have Lastly we initiatives attraction which have aimed as positive a conversion well.

profitability these focus we few three spend improving to and related on improve of combined opportunity parties. reduction of opportunities all in related going improved minutes approximately corporate leveraged our focus areas forward. with from third we to believe to a We processes, discussing the structure in The quarter costs. automation there areas are months third Next I'll our addition the that efficiencies months. is believe organic our cost productivity. Two growth, a operations manual to our streamlining XX and and spend there our Last to realized the is three shared be XX of scope be cost across to to is million expected $XX India over next in three lower achieved work opportunity for operation tasks, increased from in are

business costs the reported market improving the and prior of profitability which current search, staffing and The improve their of here first at leverage the expectations growth three to of the performance. year. the income our The simple, with in to businesses, aligning thereby really is opportunity level had goal two return physicians is contribution below

our over First staffing staffing volume resulted cost performance case declines an by as the also and search the operating we both estimated which ahead saw after last the physician annually and for in $X.X income slightly quarter took we we'll leverage. growth of of perspective, years. continued to better contribution From physician projections year continue actions steady reduce In increase was progresses. a evaluate to staffing million several physician

activity staffing progresses. show continued we closed quarter, physician in should as the better the improvement for performance and As result year to

growth As the had strong not report year, quarter quarter. a segment expect in do to that for so a reminder particularly coming we year-over-year last we

travel with identifying our Through end other between first automation to we the made which roughly to replace sized balance fully is at million in the of when activities achieve centralization, will should we when when million opportunity cost $X respect the our and in from late operating of and of us we area further second which fully come The $X realized. good reductions platform ultimately quarter, specific nurse the legacy implemented. actions half progress allow of XXXX. target The

area structure. $X is savings. is here the third million we the our cost million necessary are focus these of working to opportunity The realize specific respect aggressively to identify with corporate actions to believe We and $X and between

coming and at grow provide fast The us information quarters. to continue like first these a with market opportunity more We months new for to role. will the market about the I'd remains my comment just on my efforts in as strong the three as finish remains. to in least

decisive take We action rightsizing continue improve at profitability. cost-base and to our overall aimed to our

aligned solid our remain on We at We have leadership and our possible teams our focused completely the and to providing to delivering value healthcare with clients. are the experience and committed hand. professionals tasks best

review guidance. in turn quarter Now more our the results and Pizzi who detail for the to let over quarter will second Chris the first call provide me

Chris Pizzi

EBITDA of our ranges adjusted and and financial Thanks Bill. we overall all range. performance margin adjusted our across within segments. I'm growth as this revenue, guidance with our gross our three was year-over-year pleased revenue profit experienced quarter and our guidance for exceeded income contribution We business EPS

and seasonal primarily total trends sequential from basis experienced the X% the The $XXX.X and year. business year Gross was in down allied for The For the beginning year up down from RN was existing profit to the fewer and nurses. declines renewal due normal reset and acquisition the primarily increase for on revenue in each Advantage primarily sequential points the offset quarter nurse due physician The was XX.X%, business as to and rates from at we year-over-year travel decrease our million, sequentially. legacy as resulting basis lower placements tax decline from XX points was prior placements this due overall impact X% fewer to of by the payroll our annual margin businesses. well sequentially. mainly the which down XX was nurse staffing prior quarter

RN to couple down income down due the over year was past sequentially SG&A initiatives from to primarily million was million, adding of the down $XX.X quarters. SG&A the quarter cost-savings the prior Moving related the statement, Advantage for completed X% $X the despite X% acquisition.

focused of on run-rate EBITDA Well, in on adjusted As earnings the as fourth XXXX discussed exit margin quarter basis. are a an achieving we call, our of earlier we X% year-end this important addition the our executing an earlier. discussed in growth it endgame, for is us is cost target upon on organic initiatives is and dependent to milestone savings not strategies it the

$X.X $X.X realized in or with million Adjusted million. the During or Interest $X.X sequentially. basis the restructuring in million charge with earlier increase revenue and between impact and operating of payroll and X.X% point business. revenue year $X.X XX.X% incurred was accretive basis annual in primarily savings prior $X basis from prior including of decline million, million in point declines from revenue the the acquisition. improved XX the rates sequential million quarter XX to of tax was as to from increase we floating representing expense to primarily tax year-over-year basis up or interest discussed our points $X to Advantage Depreciation the $XXX,XXX rate prior our as prior connection coupled RN all our due rate. taken the RN The our a to due to expected quarter quarter. impact XXX is and both Income for the the as million of and term segments, compared and between year-over-year X cost-savings EBITDA discrete the The generate savings less with basis annualized This of rate our was nurse $XXX,XXX due sequential and an tax initiative. travel loan. across acquisition. million was million, slightly which $XXX,XXX of from reset actions quarter. items expense impact volume $X.X year X% XXX $X.X Advantage points effective higher increase the are on up XX was leverage added The up than amortization year $X.X of XXXX basis from The expense X.X% due was the $XX.X the to-date the million specific point $XXX,XXX of XX was of point to prior in business well

items, higher rate which been discrete stated. previously underlying XX.X%, tax these was our had would than we what have Excluding

basis XXXX. items are We order the steps currently by nondeductible rate the permanent certain of reduction XXX to end impact taking in annual reduce a rate targeting of point

of paid million on a compared notes $X.XX in we allowance the prior believe net taxes Adjusted included second NOLs the or of diluted extinguishment income a share released million the year in in with $X.XX our or net the of quarter. a attributable a March a the XXXX. $X.XX EPS quarter assets offset million effective fourth the tax were XXXX derivative should offset As remaining was gain us now normalized prior the per majority a that loss prior deferred XXXX. half with convertible partly of We reminder, in $X.X of million The which by prior loss more debt $X.XX year common of tax and repaid $X.X the cash early rate. the with $X year. $X valuation on on in in the share of provides loss diluted per until shareholders our as compared majority was the $X.XX Net to which

by for The Allied quarterly acquisition quarter, million, prior $XXX.X margin, Advantage for down points and and basis was and quarter. Revenue let Next from representing increase operating X% X% a primarily our in field averaged was due both was from increase up review RN income the $XX.X business while improved year-over-year the for impact nurse results lower year sequentially. travel off from quarter FTE due education, per prior our sequential from leverage, nurse down reset segment Revenue due offset growth up sequential and business. the due with day the X% the year-over-year healthcare three was lower legacy was business. volumes the XX mainly and prior for coupled for points in prior by business million, our business. Nurse down year year year was the tax the the down staffing payroll the up The in was XX our Segment X% in $XXX, the per to to our sequentially. The travel me prior X.X% decrease X% mainly segments. contribution FTEs X,XXX set declines annual travel contribution decline to nurse sequentially. volumes quarter mainly We the basis to from

to Revenue next to number X% down and revenue improved between in increase day from over mix largely Turning our points than in higher staffing the a XXX the less to to year sequentially. contribution offset of increase to by an a leverage decrease sequentially. was per of and from sequential sequentially. physician due at year-over-year a shift was representing due segment, X% year $X.X due the million in down X% X% increase basis $X,XXX the physician was the and the mix up initiative were due the margin seasonal margin, due prior basis points partly expansion business advanced gross was million, X% contribution up while filled quarter business. These $XX.X The income to for up our was led The prior filled which operating the was to staffing, higher Segment cost-savings days normal improvements XXX trends. prior while year-over-year of was year and pricing. practices sequential decline

initiative These leverage Segment a a increase the business. was than Management the $XXX,XXX segment XX% representing prior Lastly, as search million more quarter. which contribution primarily while was operating were increase a Other in sequential year-over-year $XXX,XXX compared income of to in and The loss was higher year to $XXX,XXX in Human prior our to and of led growth to for cost-savings a placements. higher loss increase. physician of the in number to both improvements due year-over-year the Services X% revenue executive physician sequential due and increase a due Capital searches, $X.X was

ended and of at quarter outstanding we Turning to sheet, million balance the loan with $XX.X million of $XX.X term the cash par.

drawn As have did on of $XXX amounts not our March credit revolving any million XXst facility. we

on decline the During is loan rate principle notional swap executed XX% an The we fixed entered X, on date of of the representing amount was good day. of than day amortizing effective the XXXX. DSO prior $XX.X with of reducing term improvement which $XX.X We generated million an during outstanding three our days more into April million prior the effective We substantially very quarter, to operating year. quarter swap interest made a XX the resulting our progress period which cash our believe from both quarter at the flow are Generally average we prior collections our we in ends. the quarter and DSO the quarter. our of the uptick certain that collections and tend the an for efforts collection the DSO this bolster during timing to cash in year exception our sequential operating in as were first days generally in helped DSO should with with We quarter. fourth our Seasonally quarter. pleased mid-XXs the strongest in see

the our were with capital quarter, For our line $X in and expectations. million expenditures

During aggregate repurchase program. XXX,XXX we our million existing of quarter for approximately repurchased the an share price under shares $X.X

offset years repurchase our While share current price a felt we repurchased share our year from shares, and help would we've grants. undervalued been since our that equity of it's that number our dilution was

our down to repurchases. and share We acquisitions, debt our continue strategic strategy will which opportunistic review allocation paying capital includes

our certain buybacks, program reminder, remaining within be if our approximately future share As XXX,XXX limitations we guidance. This our and shares any, under repurchase a me second subject agreement. credit existing quarter brings to have to XXXX still would

We be between the margin growth million X% expect related annual to XX of of and sequential million the basis basis XX.X% $XXX payroll points XX consolidated decline X%. a and tax reflecting improvement Gross expected profit of reset. revenue and year-over-year to to to be reflecting $XXX points is XX.X% between between

our million savings resulting between tax $X.X leverage For be to million EBITDA, cost expect the operating annual improved with $X.XX from the we improvement initiative. between adjusted to reset quarter. expected Adjusted and $X.X EPS for sequential reflecting the and $X.XX from coupled generate is payroll

guidance expense; XX.X quarter effective shares. share expense; depreciation count following and of second million compensation amortization and estimates; $X.X million Our assumes $X XX% of and diluted million expense; stock interest million of the of of rate a tax $X.X

replacement reminder, the range anticipate system replace that by a as to our be and start the initiative we second Finally We legacy front-end late between travel in nurse over will million and to XXXX million total expect an this $XX period. quarter. completed cost to system this $XX

that potential have impact of guidance We this not modeled to we not believe IT We our our second into with partner. second agreement finalized because quarter the have the initiative however the reduction our to quarter adjusted this and EBITDA like up I $XXX,XXX initiative. the than point would for open be remarks Operator? our in concludes connection this would with This no more lines prepared at questions.

Operator

BMO Instructions] Capital We will Our from Markets. comes Silber from session. now question Jeff [Operator the question-and-answer begin first

is Your now open. line

Unidentified Analyst

Jeff. calling [Henry Chen] for It's

Just correctly. a understanding this the make on sure want to just I'm guidance, question XQ

in the want it drop to businesses, seems decline revenue I'm flat revenues steady trying nurse a So chance at offset it just stay year-over-year. like understand how to should think it sequentially could travel due other about to on growth assignments that by that in and to least is there's primarily that the just understand potential is decline? there, and I

Bill Grubbs

Yes, it's headcount back that's of where the trying the billing the our the and impact. of nurse we're grow travel level headwind into on biggest from QX to result still certainly is for

of we last and think will in year-over-year executive year. to bit expect little have a we basis and physician decline to do because there -- good quarter another good be a physician We quarter on search had a

here slightly down education -- a travel physician it's sorry, allied it it flat some the and puts of like and basis there, or sequential up takes and and will looks of on with grow. basis. with It's either here puts there, on within bit slightly still growing takes kind a it's and So Allied and so and Nurse still year-over-year

Unidentified Analyst

And like... on sort is rate primarily the or from the that nurse premium side the to business the due decline impact in is billing of rates,

William Grubbs

due It's almost that, completely all to yes.

Unidentified Analyst

the and the mentioned side, million to cost that that's that X the you've year million X few removed on million And to to Bill to next over million over top that's you're that incremental be targeted earlier, this of additional targeting the and XX then years? expenses X.X million shifting X that

Bill Grubbs

this the maybe this to total next that X amount million run-rate is of to million restructuring year, and a million. little full $X Chris more get at to XXX,XXX but million million able of fourth relating year the full the Chris? be out might million think total the to the year, of that then X.X million, and a by quarter year quarter charge X year million maybe No, of the XX bit we for in the than We 'XX. maybe the a than for little first part XX X Is $X be and maybe right, total more the was

Christopher Pizzi

That is right.

Operator

Our Credit from Rice J. next Suisse. question comes from A.

Your line now open. is

A. J. Rice

Couple might. of if questions I

First sort of the and remind a and to are I call, mostly about all own the market in the coming internal order-book so attributing gains way me, little placements, you in attributing mostly volume sort depth of issues your forth? the talked the the of that know that experienced in recruiting disruptions in are that you and to the in the bit we just you is -- last of this this out so reacting third quarter, rebuild

Bill Grubbs

And being power weeks we days schools -- hurricane here the nurse our make was part And was and not closed that that were for were Florida, restrictions outages have don't that fact you in of that that and normal was else operation minor the couple of really some to and get somebody a for we not there been them once disruption it disruption able don't afterwards. travel our travel levels a was to in closed in the was really like It and and you just again. customers of may as Florida back the them, South them Internet areas had make made driver then Yes, know, it. outages and based but placement. you several that is minor

A. J. Rice

robust, that I or don't nurse tone if filled, is segment give the financially the would perceive a you underlying whatever overall filled you so to have open your on -- tone sense sense a how And the -- be? of say your know would just or on positions of pretty underlying MSPs, about metric you market the of still travel

Bill Grubbs

a comment let how a kind Yes, manifest comment it Bill and short itself. so make I'll I'll of on make

for step dropping takes it a again of to XXX people happen. huge And amount doesn't quarter quarter how That's so end why I'll a back a it of long. the Bill billing normally change out us. that for let So explain heads-on and a on beginning billing is of comes the

Bill Burns

Yes.

the things, two follow do Bill's up capacity a you only so So to on to point, many in and week. particular one have just assignments clocks so

steadily certainly do to the It's all time. of try them getting but just the of kind and getting difficult through the first in then at and that throughout we're short hospital teams the to quarter, that cover the submitted, so interviewed the headcount them a of rise gap here it's seeing very timeframe And pipeline, with period increase capacity to very work. the systems, getting a people

can it fast make kind just a of bring going was there it. a back. But how on another point all was forgotten there's to I've you So I and constraint

Bill Grubbs

did. make headcount, different week. in step was than me Bill each of but Well, billable slightly word in number you the step let can't make our just placements you it a a change There automatically change

for making been done that, fell try can't So we start week doing because a an if that we'd have could to extra already. XXX off XX automatically have the make we to that placements up

to So to production we all to normal, so XXX. but get grow is back going back until week production much every only is normal

Bill Burns

metrics lofty were now and to volume, counts. That's of it's for days about into a the and sort forward-looking of but as 'XX do track order to it the did robust have Throughout and we much 'XX coming the seems obviously then had entered order rate kind as first of us -- see and steady asked it's right. 'XX, at grow, continue held clients we nevertheless to That orders pulling spend, of still enough grow. stabilized be you fairly we not quarter left down. on to for reasonable back do And to back we

A. J. Rice

do in an need Do comments 'XX, programs place. acceleration cost-reduction need magnitude to you to all appreciate the get order have those margin To you in you I sort then by of reductions you about the year-to-year the pretty there? margin? revenues yearend of to X% get And X% cost and would much what get the

Bill Grubbs

so the way, not by Yes, it's the quarter 'XX. fourth of 'XX,

A. J. Rice

yes, sorry, 'XX, mean I I know.

Bill Grubbs

will about has we by the Presentation I new we'll able get as the it website. once of it to from think profitability our million to past need today at be in on or fourth grow of we headwinds. associated is basis that a about, No, increased million $XX will either The well. time or old we our there quarter one posted $XX talks -- be comes posted. it million talks get from one dollars with about million Well, the be it to it mid-single-digit page $XX on $X cost-cutting, 'XX. actually has want numbers And clear. we Just million that $X tomorrow believe the -- what be Investor comes annualized these in

A. J. Rice

conversion disruption then just Who disruption in quarter cause there. much little do just Sometimes And the is a said vacant this? than know more out? disruptive how experience rolling And doing. going for you're can understand rollouts question how I'm my you you've is to is -- associated I expected. disruption? is think with the trying this got system I you second is risk last systems around guess to the reconfiguration

Bill Grubbs

the recruiting replaced there's a businesses to travel nursing. in years Yes, over few last the points of in all make. systems we our is front company office couple the One except

I think So and completely process us pitfalls. this the we isn't understand a new for

second XX-plus of is of 'XX. at we to wouldn't was out. good month project, very till But disruption disruption, us. to there have actual to organization If be when believe the 'XX support the we this half any the partner, roll Well, implementation all. it be second a would be half going IT anticipate Secondly it anticipate starts it don't disruption. any management an of don't We we in we've hired change a

support management big we're in it help and business that different we using to we as the made think segments going well will that in bang. January it won't I phase go restructure

issues or the not expect we be So identify we here. believe whether it We it's way we'll have performing to. able to and a there whether are very good process

a track to As project on that confident successful. the of implement years development But I'm a you know, going really pulled from the was this half here started second I we're and we won't then. it really couple it because we I very had plug here. It's good be didn't think of ago, till until 'XX.

Operator

O'Neil Markets. from comes Capital Brooks Street Our from Lake next question

Brooks O'Neil

business. Bill, your So step be nurse strong trying that just season. I sure a to what function there my pretty are flu in doing sense hospitals is drove was I travel understand decline am Obviously well,

Just it help of is phenomenon, your us was related to your anomaly it business? understand of industry this a was something few an hospitals or an core

Bill Grubbs

No, related business. it's track. generally is everything not core to think our on We

Our pretty is production good.

placements. the we then continue at And into year some the recruiters of beginning impact to based of professionals, at was bulk if down. and just that mostly QX during phone make last we Our have XXX make it to result from placements shut little of of a a hurricane. was pullback hurricane. seen the lose of off in can't of had orders, are of of to as The disruption that And from on And the couple not bit a end bunch not drop of end of to our we big being the customers QX. of then able QX nursing the September Florida calls the online business get And can't and the the is the fine. Bill said, healthcare their South travel

like seems change, to recurring and that incidences seems isolated good it we're are the of we kind in back like shape. to and us the think to step unique not level build it it's it up prior had we once So I

Brooks O'Neil

kind Could I'm integration? business should of positive that for it. related be rundown to you a Advantage more left of in whatever I've not quick give acquisition. there in And the RN I'm terms reason us thinking just seen

So me that. about help think to

Bill Grubbs

We jobs. our got Well, filling first company we've of in if as we acquired job the said they're year. MSP that a July remember feel great you doing -- last we

quarter get good we wanted that first and fixed quarter. fourth better it. out of first we had and The even we We had, an what a quarter didn't

done have acquired able be and to on when ability wasn't their deliver to I'm sure originally company that on different exactly the So -- not operating model the we our we deal was to said had it a done to MSPs. synergies,

total get but synergies it's integration really opportunities other into to deal. are or our significant built exist payroll we time an weren't -- any some billing credentialing look and will that that we functions we whether and or integration of But into So building cost-savings, leverage nothing at probably all functions there businesses, a the standpoint. million $XX over across from

Brooks O'Neil

you as still business, that still area And you do that in growing managed for and then robustly seeing about think the beyond? you somebody services go opportunity significant but XXXX think I there's talked and you're through

Chris Pizzi

look at usual to new couple forward. expect per amount going to us yet still pace million of this just the we year, to $XXX quarter to very off 'XX. We We're rate both plus is saw into continue you and had the good 'XX it's tremendous know wins, and and that and obviously if a wins of start opportunity of that, close on for mentioned that spend capture don't grow ramp take still a MSPs the do Yes, deals continue our strong. I we'll those to for in plus we the years. Bill of win pipeline as call, of get of from but it to number

the there, to still Allied table focus at like. of us. is and how physician we definitely at the MSPs that the We're staffing for as well a opportunity looking the expand big lines and it's bringing service continue we're area So our and to ensuring

a think big very us. this for is do we opportunity So

Bill Grubbs

rate. Plus capture the

Chris Pizzi

capture the up, right. rate, Plus moving that

Brooks O'Neil

understand it how not I've us but me, past? hear and could always I opportunity then robustly for help the for market an to had is big opportunity a the education you good-size has question about others, grow the sense a from in was that think you And that something past as you the that reasonably last continues whether guys. in the It's

Bill Grubbs

the was and will I'll remember of to dollar is, at out the it across us Mediscan very do acquired it grow. the last Yes, total we're years, only make do end have an somewhere, available, market, think of competition where view but good a underserved think school and it's When the that. now think we I have we couple think don't $XX there's dig to it's it in significant, good but can with it hire business organically a to opportunities seem the of if that presentation differentiation and build that know I lot the a what consultant -- we on. we about continue model do so -- opportunity We and pleased 'XX, doubled some not -- a -- did in we try It's to the we we don't I I give were as a nation, analysis have to million.

opportunities. So if we're at can well expansion, organic as acquisition we as find both potential expansion, some looking

Operator

Group. comes Kevin Steinke question Research from Barrington next from Our

open. Your now is line

Kevin Steinke

So on there Act your customers and that like Care kind assignments around just us of some due in were customers environment general new about the normalized assignments uncertainty are throughout is Affordable demand hesitancy some new some nursing the behind to around pause to to market calls having rate? now uncertainty we XXXX discussion commit at committing completely do to feel and travel

Bill Grubbs

things to cuts, help and or help reports money, -- own encouraged that them I customers They help maybe be us getting from business become but up generally they're seeing are get profitability a that's on quarterly think managed how asking to is requests such have yes some and helped it's and site. be up professionals seem seem customers us healthcare it. behaviors think years. save to big way that to in be our to to find automatically programs I their it takes efficient, these before because of to time last and we and seem think to why the show customers for -- challenges. they speed managed programs, get the of to And more sign I in the we're a reviews calm things service and at good a to that's and them for really But yes, a hospital down such take-up for in efficient why that we've I by up numbers better recent buying but nurses the Yes, a generally more still and create uptick asking support, think seen I'm patient couple seem I were us not efficiencies market, our have normal to cost-savings service for our to big we Things pressure settled over they behave, but are with trends lot no. price down. where back back

Kevin Steinke

to up in rate, continue following the just RN rate higher? Advantage did is how driving capture contribute capacity their they And and really RN that improvement to capture the on how much much sequential left Advantage for discussion,

Bill Grubbs

this look and numbers of is one, so the I so this Yes, these of the numbers, capture so what one percentage if I two at so at total X% -- Chris, look if here, rate that

Chris Pizzi

a probably of Right, couple hundred.

Bill Grubbs

of increase Bill? right, X%, Advantage hundred RN in points and that capture the Probably our from couple came basis rate. Is

Bill Burns

right. That's about

Bill Grubbs

right. I Okay. [indiscernible] math is my

that. with pleased very we're So

we of more they've forgot help I and of second legacy believe one is more continue was. the than up. question that we that up, drive that capture that proven flexible our So that to rate the what go old nimble going the to after system part that and they're can is ways

Kevin Steinke

how yes, capture to rate? No, that have higher capacity they much contributing just continue to

Bill Grubbs

this, feel on to successes spent do want to we've there Bill I've build Well, I'll what answer said, Bill week invest have and couple ago of I to weeks so had, answer I'll we that. let that. on let I the he a a build and do

Bill Burns

our that's on to stress to our very submissions protect of obviously There's the aligning core desk amount We're MSPs. programs. to want MSPs as do looking and funneled effort level outside preserve to focus I much that a have MSP focus business grow to possible. a that we of ensure do got with be as the as managers that they've MSPs. want that account to possible, the as our much and and with keep Yes, at the a concerted are continuing they

Bill Grubbs

This an either/or. isn't

Bill Burns

if This ensure programs, continuing is third-party big they to we've still have, and of the not were information the flowing better to to sort deal lot things a the focus handled an only to the as their no barriers retain and... want to might that's at is either/or, subcontractor broken that they that but case, we challenges though that very lot of longer us being book we're been a so of they business a a were the MSP moving on there's down continue have first and a

Bill Grubbs

what a X Based the the about target is on involvement, XXX point the year, are for quarters. improvement targeting we for basis probably from next their MSPs

Bill Burns

yes, sequentially, Yes, that. would agree with I

Kevin Steinke

forward, lastly can said believe so your how contribute just you with then so on us update attraction expectations move conversion are, we you you they and provide un and the could that maybe there to what doing candidate I the mentioned And efforts is contribute? growth now you how and improvement as along far you're can

Bill Burns

that the making level on at foremost that, the the analysis we've review been things lot things the over-credentialing they're call, them sure candidates on details call our get to tools we data ensuring nitty-gritty candidates not have from the moving recruiters and give efficiently and there's processes a live looking we're to but their having for with We're there's that process as back. as be hanging we're possible cetera. ensure all call and up of do first the mean, our lot a to that that to them at et the not to that the desk through own I so ability won't we're of into this doing able

for speed moving level the better looking we're candidate up the to and better the process desk conversion flexibility having So the at recruiters. to getting the by tools

sources, so, some sources travel to are and where back most have back quality. conversion at emphasize that really start look and things. couple our conversions ensuring always that our mix from we're and getting obviously lower spend efficient and where rates. pull identified candidates we're getting of better are cost-effective We'll to coming the We are the those of and from So better

Bill Grubbs

to to add big with communicate do that lot multiple run that we with our around can don't ways push candidates at do we more and our a have themselves. as that them, one access to chatting that we can I'll so access information technology time, online portals And in it with more they engage a them that for gather texting we we so well, them data recruiter to we a the candidates, for had also have

the So process improvements, as it's also Bill but improving experience. said, we're -- candidate

Operator

from SunTrust Humphrey. question comes next Robinson Sommer Our Tobey from

Tobey Sommer

in travel mind. Could you quarter, order you're in not nursing just the in include in and but I April could what 'XX, of terms if have describe changes levels in maybe you seeing

Bill Grubbs

front 'XX in trend MSP of mean think order have both me the I it don't through now. I right I mentioned earlier, a much downward Yes, I non-MSP. on volumes, we as and saw

of Going has into been deceleration not -- that 'XX has there.. QX that

Chris Pizzi

from increase QX an QX had we No, though. to

Bill Grubbs

of think or first as increases not year, kind markedly held up 'XX, into down, up. I been the we've slight did, -- they're of certainly have of in off leveled it's a… orders coming it out the but going We the quarter don't

Chris Pizzi

steady, Same, yes.

Bill Grubbs

..stable state.

Tobey Sommer

renewal like travel in trends in What April? were in the quarter nursing

Bill Grubbs

down… were fourth they that's mentioned were lowest as one to seasonally they're have continue I renewal quarter, They continued the so rates rebound. The always -- in thing, but

Chris Pizzi

were They way below... down

Bill Grubbs

or we are expected basis up fourth I'm basis quarter second below say the looking... had quarter The first quarter 'XX. again have where sequentially ..way going of numbers in the XXX into probably points sequentially points going the into going we're to rebounded, and XXX as

Bill Burns

they're And high. all-time near

Bill Grubbs

a focus high. had several big Yes. for And of all-time weeks us. we've of now is area It

healthcare going managing orders are get get they're just making that long, professional. if obviously so the move and as orders renewals with they renew proactively to and locks. can we our trying on you as not client -- They get converting as that off sure those the sooner to can fast too else, quickly the to renewal possible they -- coming We the to somewhere to don't for start the up it in as productivity they're wait as go we're they're focus end assignments we're new improves the working

Tobey Sommer

headcount in like the the kind on could of what wondering if What's without of year-over-year a about with staff you speak been acquisitions? it basis? kind it of of the And headcount sales the looks decline maybe related face recruiter Has gross, the just revenue impact and like?

Bill Grubbs

It's still have progressed, to headcount to harder. mean we little down year grow, invest capacity level the I -- is be the recruiter a we're certainly it's a of continuing as at in going that. to

to our a I flat to the include reported stronger. when bit a think it's revenues closer were if where you you probably we travel on looked business legacy basis, were acquisition Advantage when to prior with nurse

Tobey Sommer

commission weather make handle you to a make the the for own and reasons run-rate weren't you do how kind recruiters of that impaired outside related Did decision experience company did turnover able rough quarter and to them kind lower their a or whole you the for revenue as they control? fourth of in of that patch achieve And productivity? of kind to

Bill Grubbs

on was to than a Yes, back issue generally. have And I turnover but staff we probably from Everybody we because the our major headwinds. on talk disruption things that we level. mean, so trying to did again, call, that about not aren't on see do more internally any get didn't open at it an the big wasn't focused there's going some trends we're normal of any

Tobey Sommer

at an from all? from appetite the and of quarter if in areas question perspective, different And signal repurchase the last have M&A not, does focus me, M&A a slight for changed your

Bill Grubbs

we some we not. to of last I in that available behind $XX but into depressed share flow first it, generating pretty $XX to enough was had, cash do board some and the what do you quarter, acquisition. would still we price do the we're what share and is buybacks year, does It like good so was as million the an acquisitions, to it, million operating know money feel have eat have we not

but the So going to revolver the cash we $XXX think million had at think -- gives unutilized still we're shares of $XX $XXX think that's million, or an XXX,XXX quarter some dry we're spend to $XX million end I point, okay, million plus still XXX,XXX and today at have grants because might trying $XX that gives on the so we share we or from dilution offset but million buybacks, we're share enough if us I more do not to about do acquisition. powder I

Operator

Mitra Our from next Ramgopal Company. question comes & from Sidoti

Mitra Ramgopal

MSPs do side that to of of wanted initiatives in out much to one infrastructure relative the you etcetera? to have step-up talked a cost-saving get the in how probably I to you support benefits I Just sense etcetera had I on more curious and should expect investing make on question, grow terms the just the better to the we the of terms building push business. about you know technology on the investments was margin, from still terms -- the in have just in to

Chris Pizzi

would the is net So million that well. as we of $XX to investments make of need savings cost

Bill Grubbs

Well, for number the in the in the still to investment those project or growth replacement, buckets modeled it in technology. whether to that revenue-producing organic Not is are net the necessarily [Indiscernible]. that's three in there. going to business in of normal heads isolation, continue But assumes we're not Irish investments make grow that's

Mitra Ramgopal

of to if into you then will terms you're there XXXX expect investments a know or give you're of that, just if could us you that well -- don't continue in is get most along making, done as And how far follow-on year? in this it I

Bill Grubbs

IT or other... The investments

Mitra Ramgopal

IT. the Yes,

Bill Grubbs

million total IT of Yes, that sure... think we're Chris, is be of it we XX% so $XX not million, to will the capitalized, $XX

Chris Pizzi

Yes, we the but... have not agreement, finalized

Bill Grubbs

-- either capitalized or deferred or [indiscernible].

Chris Pizzi

Correct.

Bill Grubbs

or to when the phasing it's because and have all we'll about it's Look, it really and finalized nail sure make down. but yet come we not everybody's deferred P&L, and hard it, capitalized aware what's details back the what's of

it for what -- is the what accounts to how know it. for say the So and right sure we -- have says, the until phase apologize I it's contract we that don't yet accounting it going

Mitra Ramgopal

And then quickly that forward? we should view on the tax rate, how going

Chris Pizzi

the reduction but at about for XXX right mentioned, couple a basis are for I quarters. we looking, point rate tax XX% the we're effective in So rate as a next tax for the annual income now year, of

Bill Grubbs

get We hope to it down to about XX%.

Chris Pizzi

get to I the it rate. for into by end 'XX year use year then of the the would the 'XX entire down to and XX% Hope same of

Operator

Our next from question from Plagman Jason Jefferies. comes

Your line is now open.

Jason Plagman

the did you the and trend order market? MSP any following the between up on in So with order demand difference non-MSP discussion, in trends -- see

Bill Grubbs

week. that we look Yes, see, at every

up, not I think market, huge slightly swing. but the MSP slightly are general orders a ahead over

Chris Pizzi

No.

Jason Plagman

opportunities? And wondering to there of seeing the Greenfield and what's clients mix new between -- adopt MSP displacement the MSP you're mix opportunities pipeline, looking displacement? opportunities new then Just on adopt or if the just versus

Bill Grubbs

another from XX-XX now you... had probably sites to Yes, had and had change so -- We in Greenfield guess, every never look looking 'XX and someone's if completely before. a had pipeline look new versus wins it's we this were scientific, isn't existing the I a 'XX week, Bill, vendor. a customers more a opportunities program do at I of high make where new that percentage put the of to but

Bill Burns

the I'm at just looking year. we wins It's... this reported

Bill Grubbs

so. way, that Exactly

Bill Burns

coming we So into they the year, like talked Greenfield, about were that just two the -- not... are

Bill Grubbs

won going there from that so and far But Greenfield Greenfield. vendor customers are their a existing still is opportunities both it's decent aren't we this everything year make forward, difference and opportunities. So happy of mix with a some good may that but existing

Jason Plagman

displacement led? those opportunities, are are or MSPs vendor-neutral And primarily staffing they those

Bill Burns

mix. a It's

Jason Plagman

months? up the of last opportunity kind bringing from ramped hovered for me, and one ramping lower $XX signed over that What kind that's prevented of million And last implementation last getting then would MSPs of around there, has quarters. few MSP on you've bringing the making from up you on you XX kind material XX the to those that progress say --

Bill Burns

to Yes, new it's flat. then a No, so and little up are million just coming deceiving same back time. them we because but the it's level XX billed no, we that then coming the ones $XX staying bringing are of not that's the it on and and XX ones of actually million, some some XX same million on new increased million, at was

coming as just we've number doing ones offset the we're It in So to be increased. that happens don't new it read what to have stagnant. the stay anything not same

making we So are progress.

look We at to. closely before, statement what going very, go number the happened in going those we've usually to to we predicting We I we We're track and if good and to, and made it's moving all of the what at are 'XX very very forward. 'XX, get the think be. spend you get it think 'XX is

So same is million XX% then that that up first XX% end million expect in will the as hopefully capture and at show million and was XX -- is that million quarter. fully ramp. to then $XX well not ramp no, that as our by in rate our I quarter whatever fully we will as we'll won that But, XX off the as they numbers last XX the

Jason Plagman

to eventually similar I back six get to just XX can we worth MSP quarters million XX MSP wondering kind of worth levels? [indiscernible] couple logger should wins, it million remain or was expect I months of of of just a

Bill Grubbs

Yes, get probably implemented. is to especially it get XXX capture to win think will I these much our it we things how a XX hard of that come depends where will and be. million how the predict. It's they high-end quickly I on ramped. down It we little million, normally and increase rate guess bit as

Operator

final of comes from Our question Sutherland The Benchmark Company. Bill

line is open. Your now

Bill Sutherland

of travel, And Bill the Grubbs placements the difficulty] the revenue to least literally help recovery, at it Burns, the difficulty] question. for or mechanic the one you [technical [indiscernible]. [technical is can

last [indiscernible]-- of maybe of guess the mechanics I end I so just this? the quarter, already difficulty]-- about focused, added the may back you've that's [technical understand second I'm half do sequentially is If wondering difficulty]-- month and [technical

Bill Grubbs

average ending QX is -- answers the it trying how in it December, dropped off February, so We've doesn't and story. on end how on the based not half. you going not And point. on think see the we of again and and that points to November October we big could a to we're and in the it look, I ending in it ending gotten what we're that is really tell QX. revenue think is the wasn't the the terrible, average I tell came three were all the out a the the continue back back average, but you that, four for the that's back grew say we're what The bunch most the of disclosing I'll below for half over back phased and QX about is the hope then next the before But year. purpose done is April, a the January, a but March mean, data that point the and really we challenge that in is which how a quarter, kind of in I where where is a month us up of to within what revenue and the where months -- you XXX at generally thing we But it I in number well so bit, had because is or periods was we're going back hard and broke year last against within the really and so the We in QX the because again on is depends was it a last quarter at of or you quarter got good a full it's we get the how it end Yes, to to talk fourth of in. is how fourth I QX, it quarter to exactly wanted phased from to ended of challenge XXX us. that question. little what gave message pain question. which actually we've comes but relate that give for so at what good

Bill Sutherland

second is in therefore the towards not can be as I the surmise So quarter that and Is is January this impact -- guess the that that... to recovery on I going period revenue of is and April-end what meaningful? more the

Bill Grubbs

certainly but, those started much -- very out way linear low of -- as of have you so result because extrapolate just is it with January an impact of each not you're it in it right, certainly and QX mean so a I what it's the data, yes, to exactly Yes, hard and data as endpoint said. the won't

talk At think in this and guidance. to our I QX prepared about be again Well, back remarks. our Okay. that concludes we'll August QX everyone. point Thanks

Operator

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Cross Country Healthcare (CCRN) 4 May 182018 Q1 Earnings call transcript