Earnings call transcript Q1 2023

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Operator

Good afternoon, everyone. Welcome to the Cross Country Healthcare’s Earnings Conference Call for the First Quarter 2023. Please be advised that this call is being recorded and a replay of this webcast will be available on the company’s website. Details for accessing the audio replay can be found in the company’s earnings release issued this afternoon. [Operator Instructions] I would now like to turn the call over to Josh Vogel, Cross Country Healthcare’s Vice President of Investor Relations. go please and you ahead, sir. Thank

Josh Vogel

earnings Officer; and by our you as Krug, as Chief Group good and Delivery. Commercial Officer, afternoon, today joined well Financial our Burns, am President I Bill White, President Marc Martins Chief Officer; everyone. John Thank Dan and of Executive Chief XXXX available discussion quarter. our as outlook our the second Today’s a financial crosscountry.com. for well of call will is the as results copy press of website at our A our on include first release quarter of for

statements note that company’s on Please currently constitute may forward-looking upon based These certain available the made reflect this it. call statements to information statements. beliefs

and known including report on As the release, XX-K the materially as statements noted annual as actual the prior to guidance vary with in those release. company’s on filings our uncertainties update forward-looking to XXXX statements can or forward-looking press other company intend XX-Q, and quarterly next other reports earnings not unknown contained and risks, its subject in factors, of results any in to The well Form from SEC. and Form are does

U.S. or release. when recent excluded call, included Also presented. related to financial non-GAAP More additional normalized this press most considered per the as adjusted such financial to share. or these GAAP. reference superior pro non-GAAP pertain provided our for information substitutes in periods are though adjusted or with Such the information acquisitions results calculated EBITDA we Additionally, and accordance during our is measures financial may should in numbers be non-GAAP measures as earnings not refer those measures to from we as contained were to forma

now turn our call that, Chief Executive I to Officer, John Martins. With over will the

John Martins

joining for and this everyone afternoon. Josh thank you to us Thanks,

for our once and the the of first again guidance revenue end results EBITDA quarter exceeded top have adjusted ranges. Our

service and delivering and our more to strong organization businesses of reflection be it into transformation more a our best-in-class the efficient by to the average many is but will highest details digital of execution dedication us investments an fueled our clinicians is Bill productive our on deliver well numbers, to performance testament allowed by in across bill a and performance employees care. better-than-expected Our as has that while was a travel our clinical quality the in as rate business. higher-than-expected get of as

and last over is the When performing expectations, ahead sequentially fourth XX% integrations up acquisitions for an X% include business now backdrop an the Mint example, days physician Physician XX% and the of on was history Education, volume higher supported an run-rate specialties. of increase $XXX quarter its XX% building we revenue saw of mix with most year-over-year our year. year-over-year we robust of over by annual with revenue staffing quarter. reported increase specialties bill over rate the our fourth performance in number in improved to Organically, Lotus, and contributed also million. demand the and revenue in and strongest of across of successful quarter well which are a grew staffing filled position

Lastly, expectations care our as of well. acquisition and were space in ahead home the interim our leadership staffing recent

due anticipated, single-digit XX% been of a of sequential for travel. for anticipate to Average reported settle the X% year we as in existing specialties, stores than Let renewals new of were decline in single-digit levels we range, few end to largest timing we rates are results. for projecting starts the between recent travel quarter, deliveries XX% low rates a on continue we moments for me such where on assignments. spend third line decline fourth and has of we to locks, second on and X% our new to in to decline second we the and were Based Though to mix in placing factors but a little business, the when expected with bill the sequentially rates flat both the pre-COVID be low roughly track rates quarter slower a XXXX. quarters, to sequential expect above mid decline and as entered the

not reduce while Turning this noting have an first into Cross for It’s that stress Country. candidate second critical specific labor, orders quarter. renewal remain clinicians. orders levels also struggle and is to that these assignments, will demand an just there the continued although soften to for contingent remains industry-wide slowed, to our that have a I the need travel throughout worth clients that new rates shortage and historic trend indicating travel quarter is near to ongoing

to XXXX While through year. we does continue and level and should very their of Demand we at rightsizing move understand support relative believe has as we systems the number our we certainly it approximately costs, performance. health of be if it has the the half back to high the on assignment feel overcorrected. Regardless, to lost operate almost X.Xx a the which with nearing rebound point start market travelers to as

Forum the At ahead. staffing example, the National NCSBN the workforce a nursing Workforce health of study high level, severe systems worsen by it State Centers. that shortages Take that projected appears in April are years Nursing the to and face conducted for

XXX,XXX the younger old. care pandemic, workforce are nationally setting than and as plans the RNs burnout one-fifth exit XXXX, roughly to an group retire. intent is XXX,XXX the our of to the to in study health lead years projected XXX,XXX by well RNs another in that addition this to as the that coming left the years. stress workforce Included estimated Altogether, surprising a XX nurses during indicated have In RNs workforce

nurses gap the the Mackenzie will bed are States Another and in projects in staggering, XXX,XXX XXX,XXX only space XXXX. getting the intensify clinicians years. to enough these challenges coming study by of results side imply United by to a The of studies that hospital in

a spend initiatives. moment technology Now our let on me

then, of been landscape our last have in migrated plans which service analytics platform we entire have our provides technology XX% system. is our parties. migrate clients Intellify, highlighted, save We us the center the time. since majority of our will insights to months ecosystem at previously annually managed onto a successfully to redesigning Investor event And successfully this vendor the September. XX Intellify our Day model using At paid data-centric we program of that dollars introduced As fees with current management over real third proprietary millions in tech next and

retention, reskilling. these Intellify that contingent go When aiding challenges we clients helps upskilling as excited highly just beyond expansion We labor it believe a the talent industry include Intellify the on focus are redeployment, while within our very to meet tech-enabled up and address opens sourcing, be the today, in opportunity conversations neutral comprehensive multibillion-dollar and by our and management prospective strategies vendor space. workforce platform. solution differentiated

which, of of our thrilled our that interested am technology. Speaking we in in I we a contract robust first announce signed pipeline vendor-neutral and clients to have March,

share in we for offerings. level believe under last though management and looking spend earnings result clients are evaluating it And higher through churn, discussed Cross our service save on may this that and unique presents As call, we vendor-neutral for managed its can of understandably opportunity our money. alternatives a to a them expand of Country their needs programs

struggle and the they to I’d even you for investing in are Modules and In client true quarter, interest believe to diem certainly Intellify. contingent labor that per pool we greater technology, fuel never done as first Intellify that launched internal or is say, we like resource cost. IRP. As the within will lower

will the includes to improve system, well go-to-market ERP our which strategy believe we this our of addition technology-related In other that technology our as now initiatives as investing $XX replacement year we nearly projects, anticipate core on efficiency. million further our

our profitability the continuously to headcount. capacity investments long-term By leveraging to to resources quickly and medium models, have our growth. while Turning drive near-term ensuring in balance seek we we

year. Given of down continue investments, evaluating market are the the highest we also the the we the while quarter, maintain is softness of for since is headcount hires travel the we we current of of relative through start appropriate X% year, highest level the areas into our ensure and Coming and down total performance from primarily our to productivity demand attrition profitability made proactively and the about infrastructure deliver ensuring increasing we this to point, moderately of in second have believe scaled management. the At spend service. level other the conditions, level last

That brings outlook. me to our

The For wind revenue an reassignments. quarter, second sequential decline $XXX to be expect discussed, down single-digit volume the driven rates well to as due higher million. we in $XXX primarily travel travel is in part decline anticipated by between the high as million the of to we

margin a adjusted $XX be between Our at is north midpoint. X% and reflecting to the $XX million, of million expected EBITDA

today. full second and year EBITDA expectations X%. Looking year implies are above to we a – have $X.X adjusting we the deliver in least at our the based margin the million, full revenue on quarter, of of business excess billion now Accordingly, which adjusted we expect $XXX XXXX beyond the for on

program Overall, shares achieve plan. $XXX plan well of share growth remain by exhausting we announced new under as we prior are confident deployment million repurchased of and approximately on through the shareholder X.X a long-term we have repurchase increasing the Since in million we that capital. can million we organic focused year, $XX last for August value our authorized as

to continue to our With plan authorization balance remain the our with pleased believe repurchase am share that undervalued, and in to opportunistic be stock. we under shares are intention $XXX given million, announce the the strength to we more repurchasing I restoring the of sheet back

employees about in employees the build evidenced success of is And Company our prospects measures that the truly Intellify, company. their believe a momentum In game we about are as our comparable, Best excited of XXXX a our closing, from the by for and excitement, to how Country. recognition Winner from are Cross changer we outlook which an confident early remain sharing is this which as ability award recent upon future

is growth Country to inclusion, and of Our the stresses the of Cross and our value. catalyst workplace it a key equity diversity, heartbeat importance and culture and fueling

board, decade. our you you XXXX, just been call the on shareholders tireless all who service like And within Dircks, nearly the we public to and Chairman of before company. employer the believing handing of Cross in in Board Country. their company Tom for to Thank the as and more to as would of management our of to to well thank for the the Country behalf a your going since Bill, has years employees over Cross work dedication, of as for Tom before our thank than serving rest and XX the involved make of myself, professionals all has choice of

call turn let the me to With over that, Bill.

Bill Burns

exceeded year-over-year the afternoon guidance prior less down execution, good X% end on XX% we the and few John into the profitability. by pleased Thanks, over of revenue and minutes. and than normalization of have trend just again sequentially year, the decline our details high revenue travel bill the in driven rates. our solid both Consolidated primarily I’ll million, more of segments $XXX everyone. once down for were was to a ranges for quarter the Continuing get with

travel. Gross of payroll were for basis the XX profit approximately in improved at the gross both in represented for start spreads of over $XXX been margin sequential and XX the margin a which million, pay gross improvement even improvement was higher from prior bill tax primarily to especially the sequentially the quarter have basis year annual reset would impact margin within year. an point not due it points, the XX.X%. The the Gross

sequential XXXX was acquisitions as as increase and with completed attributable increase impact income from prior the for the over X% well expense primarily administrative ramp the salary in the a year. SG&A over and basis, was On the by annual benefit-related to associated costs payroll prior in made investments well year. was a The up million, XX% total the resources general down as driven throughout spending majority Moving reset XXXX. sequentially last and the of selling, tax higher the and statement, year $XX as technology

XX.X%, was and up XXXX. As XX.X% X.X% last a quarter percent from SG&A of revenue, in

we investment As to of managed conditions level called current the quarter, resources by the leveraging match capacity last market our models. out we in

and overall up continue Our to goal ensure we flexing protecting grow while can in is in our order always to be profitability. proactive to down

compensation that by we And we annual result, new roughly and areas. certain for broader travelers reduce management demand across potential though performance travel likely were further such areas. the and cost also actions other little identified parts cost softness Education, has on as of and investments are will attrition. Based double assignments, well to revenue, softened, continue quarter. overinvested digits will care sequential for lower continuum the we’ve business in to to a that low in as primarily demand decline The of calling date growth well we staffing payroll those out imbalance anticipate home in decline and that remains, our as supply worth we to delivering through associated for in the positioned care. as single managed continued our a see the taxes the second X%, the in and SG&A with salary With support we It’s the clinicians high

make technology our as Gateway, a tech products investments substantial which From advancing is to roadmap now like known we Intellify perspective, are in continuing experience. for and

of million GAAP. line XX% with or John million, with U.S. the gross fourth the high was range. $XX representing margin nearly top to better-than-expected not goal a another double in and to since The was expensed an it track our margins the ago. of strong the $XX with in spend and single moment on higher million, EBITDA maintain margin adjusted for For did first deferral double-digit spend Approximately qualify capitalization of low the performance mentioned quarter technology quarter of quarter quarter, under X.X%, consistent $X the adjusted fueled EBITDA earnings project-related

over $X.X sequentially increase quarter. average Interest was and year. the interest lower expense which by during up The and entirely was million, X% offset quarter partly borrowings by higher was for the was the rates driven prior

for the Our effective was rate X.X%. interest quarter

tax costs. XX.X%. a million the related principally restructuring nonrecurring statement, settlement income severance finally, $X.X charges Additionally, income was matter an legal incurred million, $XX and of to effective to in $X on rate million expense And reported tax the related of we representing

we full a year items, rate discrete Excluding of and effective tax XX%. XX% anticipate between

range. per end sequentially $X.XX, resulted upper down of above an the adjusted earnings guidance $X.XX performance share in Our of and our

segments, million, year. prior nursing revenue X% of reported to Turning sequentially and $XXX the the from down XX%

decline was down and assignment to to Travel Mobile down normalize average systems from entirely business, a XX% was XX% largest usage. Allied the of decline the number bill the in Nurse almost The their decline prior as due on Our to prior a contingent year. seek labor and decline X% year travelers in from to sequentially rates. continue sequential due was

bill both the Looking to quarter, and the hours we rates single-digit sequential in in second billable anticipate high further a range. average decline

rightsize continue further for And a the though ago, second clients recent demand to a into rates to contingent off quarter. decline we few labor as leveled fourth moments remains the and and in quarter beyond visibility as While in bill pickup is a seasonal usage, limited, we it’s the continue anticipate mid-single-digit quarters third progress we soft in expect the mentioned range. as John third their weeks,

to XX% of high in continued from segment, diem per over prior with business felt year, predominantly Also a history. year, its Our reporting quarter trend in the the local prior demand Nurse softness impact double-digit the business due its both down or sequentially revenue approximately also our and in Allied strongest hours. a the revenue the from billable Education and within decline growth,

the also placing services businesses approximately care We saw an annual home the staffing on prior mid-single-digit range both of year, in million. growth these run with rate $XXX of in

over delivered of Staffing the growth X% strong XX% sequentially an revenue and organic million, increase with Physician reported Finally, of $XX of another year. quarter prior

Staffing the increase was number in the up last bill days XX% filled as impact from improved acquisitions rates as of year, the an Excluding completed well Physician on

facility. in cash million under in and $XX term our million quarter to our debt, outstanding balance ABL ended million loan the the We subordinated and in under with borrowings $XX Turning sheet. $XXX,XXX $XXX including

performance maintain continued able approximately and we to our a leverage cash strong X.Xx. total positive flow, of were ratio Given

sheet, further with operations last well $X With quarter, during health make $XX we as we technology investments quarter. of the in shares. or well our just the flow repurchasing continue a From compared cash million from balance to in remain positioned generated cash acquisitions as to perspective, million as through

impact year. but for XX higher days quarter as DSO is quarter well reduced operations from come quarter of payoff very cash an due annual that from compensation by taxes, and the the our as overall payroll improvements our first since for generally we expect improvement incentive DSO a lightest from into to collections than the days X positive The The collection, normal. remains saw for we the see continued roughly We’ve second end on DSO. higher of trajectory to the in

an quarters ramp increase more From over an cost million, cumulative additional an aggregate time. Since a million shares was the the X.X in to aggregate we repurchases we repurchased of the at second to continue of investing million $X.X the than an we our trading during $XX financing or cost XXX,XXX X.X the XX% bringing start Cash outstanding nearly representing last of million, plan. the X% activities investments. additional to shares XXbX-X year the pursuant activity used million shares that prior at during three technology quarter, $X of an of as shares perspective, quarter in repurchased

in for well the authorized intend as of or release, to available we XXbX-X the refresh trading the we share excess the repurchase and as to both earnings reported as $XXX factors opportunistic share cash, the Board the cash, million, acquisitions. which on price such under depending debt purchases such As utilize as our uses payments alternative program

our this second And outlook for quarter. me to the brings

by in as XX% $XXX rates XX%, decline sequential We are million, of number in well to to driven bill of revenue a million on the as guiding of representing the modest decline assignment. predominantly travel a sequential between decline and $XXX travelers anticipated

adjusted $XX on profit of the in representing the adjusted is approximately between and margin be to margin of an X%. due gross lower decline $XX EBITDA The the We decline impact sequential are primarily in revenue. to expecting million adjusted EBITDA sequential EBITDA million,

Adjusted Also guidance XX.X per in stock-based between a of based tax between shares. is and this $X.XX compensation an $X.X XX%. effective million, margin be of rate on share amortization of million, assumed average XX.X% expected is XX%, expense earnings count an and depreciation interest $X.X of to million $X and $X.XX million of share gross of and

and concludes for like questions. the prepared to now open remarks, that Operator? And we’d our lines

Operator

Fischbeck [Operator you. question from Our Bank first Thank America. Kevin of comes Instructions] with

is open. line Your

Kevin Fischbeck

QX, a QX. numbers in I couple had guidance. you’re When Thanks. at guiding about in the what look questions, to Great. guess, reported don’t I the you guess of we I

number less into back that like guess that a normalizes? rate of to to think year? it half a that as the going bit year, about figure off might this million Just you trying And the where revenue a drop, I it’s rates you little bill is kind be way think Or to still that perspective. of? it right ending the the out that somewhere less the be $XXX rate cadence a than where to as from Is or from is number of that. run TBD the exit looks it’s in would growing be year

Bill Burns

Kevin, second you’d the question. did of put I the the in think math the just to. Yes, if guess it’s quarter get min what year we quarter, guidance Burns. up quite that’s way. first that Bill I don’t is kind of a Hi, But straight-line the for seasonalized to the midpoint you thanks This and full math of

from the off. since of pointing main And side released Interesting what for went that time min as is now. The quarter weeks we is based last it thing to we X $X.X we what’s that at in being the the on about the the billion. third or in And continued where has is travel is softness look see trough at really from look, fact, guidance leveled last changed that talked the on you up think I to earnings. demand kind the we X% really X%. point continued just I

to a a believe, starts our more the So the demand we said, out. its third to way quarter impact we than it seems that, impact bit make to is anticipated. But to be starting softer turn. going wind That of

exit I $XXX say million So trough. the is EBITDA the Though to holding would third of high guidance, that our on single-digit quarter expectation and year we north in is not look expected margin. to to be revenue

John Martins

Kevin, restate bit just as Bill expand this would lens and $XXX that have really and just now. a billion we’re when that these seeing. we minimum what revenue EBITDA. is that that just John. are million $X.X of we the And And on about little said the of to talk demand add that’s I

orders the travel up weeks, we’ve our Over allied X% up orders several last seen travel nursing and XX%. nearly our

we’re So see the those we’re this pick we orders overcorrection that could in think happened seeing world, we optimistic sooner has starting travel up to that later. than cautiously

Kevin Fischbeck

pick help that this see And orders seeing the usually you the to guess can and at me would just kind that to I kind I time think normally about to what the up. start does seasonality XX% you of think be of X% year? of because point, compared that some maybe I you X% expect to business mean, how to of the would

John Martins

of to into the high see orders time. down We’d orders then go we number start – June to April our be would late period go to starting the which as the would period, continue as flu which we January season, the through is And July, see come traditionally. experience up coming start the we get orders, the June flow seeing through in orders then because we of down

Kevin Fischbeck

Okay.

is normally rebound this So you than seasonally to? expected would happening

John Martins

happening, had rebound unexpected. also the this was but the normally, Yes, fallen with demand also which is level of

strategically can reported last to the adding one to revenue. to seeing believe overcorrected, because that of week us at who increase and get even that level immense earlier happening come have they now the that And pressures is the overcorrection a rebound normalize. labor what we the start are contingency hospitals look price So believe that hospitals we’re under if they rates we now

there start pick these we will to think where orders that a is start we we think So place up. seeing

Kevin Fischbeck

the why you’re how trough Okay. if kind dropping bill rates QX? And into then maybe it, that’s QX, just of are thinking why If of in we still about kind last question.

Bill Burns

it a they portfolio. the it’s it’s It’s assignment, Bill fully lot haven’t Burns lot is our through XX-week the So – assignments it’s of – A so way right? their just again. of tail, Kevin, – wound

So a sequential we’re leave QX QX seeing mostly in in, be locked that QX. and on is will enter bill we as the rates we decline QX. what QX

There is of that always necessarily there there. bill bit degree little some tail renewals is the don’t So a attract of a new rate.

just that’s continued bill why be reason drag So the on into rates there’ll and we suspect QX QX. some

John Martins

update And one just Also out Kevin. because this of have John is school you to start Bill schools more all time are a for and more little schools add point our traditionally question, their to QX lowest of is where we at until the are September. don’t

So to on anticipate a softer revenue we QX. see

Kevin Fischbeck

you. Thank Okay.

Operator

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

line Your is open.

A.J. Rice

A everybody. I making of sure. all, first just of Hello, Good. guess, questions. couple

your So as before floor for anything nursing. there XXX% to expectations Is I an like that $XXX versus just less the at want basically, is million else about $XXX million that’s correct? adjustment around million you’re a from travel for? $XX confirm, that XXXX we’re EBITDA. coming that talking the Or to sounds adjusting

Bill Burns

the on by is year entirely Hi. are travel for No, this A.J., full guidance correct. is you in min change driven The side. the the Bill. softness

A.J. Rice

have are just QX. And flow this just order QX yet is thing at is with visibility have what the you that on going, you for how are much are discussions you’re Do you’re your but on giving much how orders you flavor and us – around expectations feel the that. as just QX know of seeing hospitals, how about a I and you obviously you as don’t how Can QX, actually for you’re Or for you where having firm us firm with you’ve a really QX point? And got Okay. well discussions what QX? the talking remind do a orders? for assume going, have of sort visibility – still give with I

Bill Burns

next A.J., in Maybe to we or anytime X then can is Yes, I’ll But starts weeks, the first are up. generally Marc it John Bill X have this again. help clean me the and today start speaking. orders

you orders is and not call third obviously, So orders following as I week. orders. the week always quarter they that what always refresh – are there orders the in of would filling this some But in the come kind will you’re necessarily fill

So single and the looking virtually we are, this trends week. track at where every

of kind were what that’s So we is. saying

You’ve seen the rebound.

kind We’re how the on we locks booked seeing to we flavor rolling few quarter. mean as we given call at envision give that. the our metric kind you tick I of weeks the or what’s weeks, little third last Marc, a us our more up into what want comfort on of on weekly net that’s look it But basis and a

Marc Krug

that for continues the levels Sure. over Allied well X trend the the our where And week pre trending seen and we surgeries, and therapy a over good to indicator look imaging path which January, trends we the early as and the We’ve up as week of are, specifically bounce strong following demand as physical post, up. is in area. to we the area. in are last weeks, There of demand back same is

in demand, increased seeing some excuse care Telly. to demand our such are in are business business local And we nursing, as and MedSurg seeing Telly. increased For certain and acute we travel specialties me, similar in – the our business local MedSurg with for settings, and

John Martins

– X starts. A.J., in is of the we’re happen that next this Bill of weeks that our I’m we as now well. John. orders going as book at are color to orders today just add look said, will a – XX% When the on really seeing we bit starts of to orders little

our said at historic it’s seeing seeing we’re clinicians we’re they is levels. as clinicians, that a that, of term these more think lead the in so they need a we’re in – important hospitals, quarter where orders in seeing volume. out but rates, is overcorrected remarks, our again, large I for. closer prepared Indicating not renewal the But I think of again, And third as we the as note other

we third and fourth out July, go portion even actually get but seasonality once little come. go that’s see nursing, see orders Now into quarter. the see orders late those we’re flow a the or not where And of coming. to we June one seeing travel is There orders you that’s X further maybe part until orders then X from months, fall out flu will when

A.J. Rice

I for doing say just one the systems give And hospitals my got the you it. last just or I’m same Intellify the tech on vendor question rollout. as MSP the providing naturally health with Are you any make reflected do any And or to in a if them have so, Or way? reflected that incentives? is provide financial other in – transition is incentive guidance solution? that that to

John Martins

provider, taking it’s in incumbent out help No. and built bringing technology, technology look or an save Really, the the when MSP ways. money several in VMS whether to is at different you clients Intellify Intellify

it put client not understaffed in of And can overstaffed then resources they staff to that or and resource can where utilize one certain they to not travels IRP rightsize within are the understand So clients pool. sure own make and then other to costs. into fill internal internal we their units in flow may overstaffed, as units units. and many be unit that the a and a lowering needs, helps they they need client, our is their Intellify When also

their that? more for them move be to is into – have to have there you and anything on do not insights efficiency, how yes, certain add So will into operational a even then savings them show incentive to greater data really out, we Dan, really Intellify create them. spend

Dan White

I do. A.J., Dan. it’s Hey,

they is sign Intellify, we’re a migrate the have. originally positive existing things service early capabilities didn’t to that of additional add clients them seeing as is that lines and we our over One very that

to but only not that all will. whole and about, the their insights great capability John you just spend, of they trying is of if house So it capture are talked

we same online all at had getting Locums, where recently, first are our Nursing, Allied, it’s full just service of So client full very the same – which visibility. nonclinical the time,

both So I feel now. the is about Intellify the talking expansion John to new attracting customers and are capabilities

A.J. Rice

Okay. Great. much. Thanks so

Dan White

Sure.

Operator

comes with Securities. question next Our Sommer from Truist Tobey

Your line is open.

Tobey Sommer

you being verse. up look rates are to private new we’re from renewed compare kind Travel rates orders today? average at in if framework because wondering rate prior down? What was does orders could gap the companies I converge And the rates renewals the how rate in understand bill to the that discuss and Thanks. does pricing trying how for hearing like that wondering renewal of for or you’re within bill that the pricing spot reporting? the new I’m

Bill Burns

be always gap great to always mix there open will the a bill a rate, Hey, is I’m is in component. always Bill. order that. right? It Yes, we doesn’t And you understand because at there Tobey, sure it’s new lock question. what honest, mirror

So may rate specialties. bill higher we lock

that talk about rate we’re rate. it’s blended rates we when and seeing, average a So a

all open But So certainly down. orders I consistently get there that don’t not at. definitely locking filled, I down. those it’s mix – is that say with spot no, is down would on say it’s of always directionally rate a I will the we’re necessarily component. but will orders rates

open words, rates delta other moving locking order in we’re between the and So what in tandem. at is

expectations. in lock So yes, moving is our The on is moving point it’s will line our rate, down. other only we with assignments what down that I make locking are

a saw through on demand change seen that we coming expected around biggest we front. thought haven’t really real quarter. We – the we The from the is up of that what into fall first the rest to deviation significant what

Tobey Sommer

could pretty sort you sufficient as And the – level, generate of for what so supply from rebuild Thanks. more volume take growth which this is to to of of healthy that sufficiently rate market lock the how it higher an industry much pricing would current kind and improvement talk about sort the the in or to lower and of supply? the of in in sort out company already

John Martins

– makes. take always the is What bill I to the travel I premium is, Tobey. are on that, I a there – will staff we over would Bill. and with say or pass where rate is John, to right core now, will I This will Marc Well, start it

So, there a little And always less is supply. offerings. job had that tighter fallen, incentive there attract because to orders is supply is happens is what as

or supply to didn’t number see is, a Now, we the had months triple, ago that when ago, as not we see more are we the up pick we quadrupled we up, when well. demand double, And year quadruple, number have job serve – starting a pick will of six as supply.

pick still as more up, to demand picks Bill is opportunity up. out really to grow, is us anything to continue and plenty but that? there do of have for Marc, supply we to the that demand add supply it want see will there to an So, you

Bill Burns

noticed softened the I part we what improved, as a number pay QX improvement that again, for seen, one the relative we the orders volume I there. Tobey, the saw actually decline still spreads was driver in are say we that has QX. rate out even and would at of have margin locking just of guess, And Yes. coming bill to demand that was pipeline. the that’s to fairly have are and our you the conversions still we And high

drove – point pay spread and So, we XX we actually there company. for the – the pay payroll decline, was was the that’s The spread, were about bill an were tax improvement the tax. not for a basis but sequentially bps sorry, payroll bill it XX housing in up

candidates a rebound spread. fair pay we margins on start the So, bill and the we amount locking were of successful in to are there seeing

John Martins

Tobey. this And is John,

I think of more months demand from were far unique three more will months or some The very actually I has fallen perspective. have that of that off we kind number not we has four this ago we where put won. as even one submissions fact have

the there, job are to actually, fallen want and or not So, X% are probably that numbers the a supply is down probably they unique And to themselves week. these those XX%, still off less cliff than X%. and have submit clinicians down each

is demand so further. down And – order much obviously, and

to used we in where hospital. something slow last a so definitely, the to, it’s still than hours keeping a less clinician what And now XX during And in here, It’s right from hospitals hours get to cases. are year. most honest be used hours to It looking we are Marc, able COVID be XX the offer work. between an go call and XX – clinicians would that for lock

are in hospital But the the unique six side. really days. slowdown on seeing same subs Now, the slightly. are very days off just And seeing it that’s five we to or go terms of we supply,

that up, we as we subs demand same more So, threshold. back and we actually to will unique see get will up come believe picks

Tobey Sommer

a more rate, declining of during And have at your periods Okay. that of shock rate of of for capture your to it business? you in Has Can that high absorber MSP relative demand? it sort capture last flexibility comfortable envision the might book do progressed? about in How has take higher? or me. you question And are sort of you you that terms talk would provided be you

John Martins

higher and be fact, a are we way to is are as the are arm after that a full X Look, right network. are some that to really we out have conduct sure partner consistently we supply. They partners accounts do locked build don’t new percentage matter with to we to partners we of business you said want calls, partner with true we there that close We network. to have, that going the great are we trying go as where of we that, more us, our have don’t going make competitors our we go take and arm think in are that We to as gap and really flexibility, our on a down normally are. not from because points – we true we these know

Dan White

that right need really ourselves. to really deliver a when as new it does are Dan It It we Tobey. them us help capacity they pursuing – client for this is something excess also, prove and to have

the something that it’s Country. at here us helps across board So, Cross

Tobey Sommer

into the you back for of as year revenue it total the of of your the business or back me, in With does or that quarter assume out increasing for with as the if reported? versus Last MSP half first could. year, trending the revenue, just decreasing your is line a the half book is guidance overall I question of proportion you look

Bill Burns

good out a It’s exactly MSP have I think are think don’t Tobey. on make up say question, I smaller will would the mix I it asking portion. a you for. I modeled directionally,

mentioned, I are are so to coming model, not make off to larger more moved have will get move think even model you consistent a there. they very start us, small a as over. those a it’s our a capture easy to of remains number, see John But an if even as up kind accounts neutral in-house then as costs even with fill vendor-neutral that and accounts or of portion to accounts

mean to as MSP will would I I you John, agree with or? half, think back So, that the we more decline likely, move revenue than

John Martins

in for they And we actually hospital we we with system. fourth there we vendor-neutral are decade VMS the to model strong if primary relationships, to hospitals, we the your over a contingency labor. travel the back everyone cases, model been the But had resource And captive provider knows reduce agree model. are when profile self-managed There we longer, own have for in these models a your that model, them that. as what’s with these these the – amount we directly creating gain I these a had relationships access we model, over for service primary of to of or internal hospitals direct pools This three [ph]. remain as And many nursing with past and sales in managed have they lost a a that. healthcare hospitals. are which you to also our addition, part recruit creating you these the had models, MSP, decade, large their is have where managing some vendor had agree to and clients. with look, vendor MSP may a is Tobey. John, I was right. And the staffing. move have for where have self-managed predominant clients travelers this, the help teams model, reemerging And or travel look actually in as recruiting the And to system, clients sometimes just whole

we these would if have on what actually we seen we had have TA thought managed expected ones to as moved have far, model, it so be that seen And be this our we the MSP. where to

margins choose gross MSP, And seeing the that fill side. these this in obligation every away the we so an can and model, managed an have of orders thing at some primary we up are that seeing it are these at and this bed and model, have some that actually we patient sure rates. need we to make other actually pick are that of pick also we care to goes as kinds because have Once better majority moved we of as we that obligation the clients fill

internal released module President January. built the And and to other and cannot one, And division And and Intellify modules. in this on three was officially September the resource about be us Day be this Eric here to point run just think it the months that Intellify’s hired more we emergence talked last month for just launched key of Intellify, side. it four the ago. DM could in in start per honest, the in We we up so IRP nursing from it quarter. DM that – Christianson in I we we it first clients the Investor We pool. month, it We travel is the the put launched January. of I real Intellify or the with – say was And per

X,XXX and you most technology, you the and on their over out the to look are there out tell they users because over our to solution and Intellify of easiest Now, technology are technology. the the Intellify captive Intellify it’s in technology part if And participating say the many use, speak today. going market our clients that XXX of there. be that of at who play we out we Intellify, best believe are of self-managed can the But were on the in will platform, world dozens solution. is comprehensive that that best course, and as Intellify, platform, that we we vendors that And program to hospitals technology help is with

Tobey Sommer

you. Thank

Operator

Company. comes [Operator Instructions] Our Sutherland The Benchmark question next with Bill from

open. is Your line

Bill Sutherland

things at of – you then help – time, even of be do even obviously, you more what’s to of use forward one to realized? Intellify going Thanks this main just look to are case? able the number kind I it’s understand And because everybody. kind have and the year, impact looking us a than John, to more

John Martins

Sure, Bill.

ago, our it and creating on use system technologies main it when several first thought bring first the have management competitors So, our vendor doing of find or the rented technologies Intellify in-house. case, it that some rental was own about years replace to we a and

of So, we on migrate XX have the that we use first would that was our we the clients money on rented and next the months. got then… over technology, and save And XX% case scenario check this the rest box, the will

Bill Sutherland

are you looking impact upside for the onboard? all what’s the and year me, nearly Excuse next you clients as get

Bill Burns

Bill I Bill, Burns. is this think,

are asking MSP on wouldn’t what millions like but millions, I – it savings the just the for what’s think like the of call So, the program. dollars. I of the we you in anticipate. in tens spend management predicated it’s It’s under looks

is billion which we converted. still under quarter, on at the operating of the look for that the rented majority vast management, a we in you if have spend $X.X of XX%-odd already north were technology first So, except

that you depending of XXX if is basis points XX from basis cost say technology on to the anywhere points the up platform. So,

dollars millions about. of are what it’s I it’s in annually. So, somewhere is magnitude – like it’s we that importantly, talking said, more about – But

save first $X I For run million think on it quarter, to was rate $X a probably – almost a the million over us annualized. little

and hands term the will and to hand it back we John value. be technology And savings. it of the live, we as – don’t this payback have it great had to that converted yet. immediate immediate knew to what deliver our longer majority something that’s it, we CFO, thing not the was go be means to platform the able an for it cost to would those were it’s to vision that but see So, And able as that see to But Dan. around was XXXX, I going the get a

Bill Sutherland

Sure. Thanks it. Yes. for that. Appreciate

John Martins

aspect, and Sure. little MSPs. vendor one built And a longer when that because was it go – the for the aspect be is first we management that was will system just that bit to I is

that first where new And from the is months, started self-managed second multibillion – first use. really for of is right of emergence we that it that us. is within that we three course, didn’t one of It is a zero. market the market had Secondly, in. play it’s dollar We was client. course, emerging now. vendor-neutral business this our our this case where And one And landed now

We have a pipeline. very robust

of expectations year. our the back actually we And up – we think running in for of we really is up and land – until first out So, in we half the called and is really first March running have today. I the didn’t client, which year, as we think our before, the client

a we internal Cross number pool those helps core some really don’t released going and we their on with does open we schedule. Xperience, robust to it to Xperience prepared bit And on is help their Bill out long-term yet play So, for moving part Country store his is because resource that, an two and the resource I things. internal also staff new we is the that of And called this a manage our this pipeline, have it’s needs. think bit again, a app into with internal X. begins it And put little the and little want Xperience The And hospitals into are a are impact a ahead we that’s called in released year. I which a such technology. fill what technology And remarks, last do very of feel game changer market. a in really this business. nascent is

integrated our app, pick to will our documents. all it are is resource is where mobile this employees self able pool they on core The first shifts internal wherever app also their can internal travel their they And is thing their at fly submit hospitals. allows be up they But within to resource at. can for does also it it within professionals the and jobs from it pool, upload hospital

Bill Sutherland

Got very The little bad jumped helpful. anything I to just there? model up, had question, debt That’s Bill. one it. comment

Bill Burns

mean Not it’s really. formulaic. I No.

a we move, with positive regards have into this agings note quarter collections. prepared on. on your you As have reserve buckets to comment did to I you that higher have got remarks, coming my certain are a In

of the opportunity close I cash collection next quarter, So, but normal year is out a couple DSO first of quarters. conversion in year cash there posit think of from course, The there million the I would as that $XXX million the is for if normalization, excess nothing just robust we of the for remaining opportunity $XX the in the else, of flow. EBITDA in

Bill Sutherland

Appreciate it. Thanks It sounds good. again guys.

Operator

and I John over back for conclude this closing Q&A does Ladies period. now to the Martins gentlemen, turn remarks. it will

John Martins

Thank you, operator.

dedication. Before I for and also Country work Nurses recently Victoria. signing nurses off, and thank and continuously you, long-standing to recognize Cross XXXX, just of want who one work nurse I want Thank to our your recognize for out field a to celebrate National Month, moment take personally hard every since there and retired.

the in progress of for we we we on testament Enjoy company Have to like You our call, look and the evening. on are thank would retirement. a the I affect. lives a provide much August. your to in service closing, great the In you and deserved to everyone forward updating next participating today’s call

Operator

call. Ladies and for conclude conference you this your today’s gentlemen, does Thank participation.

You may disconnect. now

Cross Country Healthcare (CCRN) 3 May 232023 Q1 Earnings call transcript