Earnings call transcript Q2 2023

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Operator

Good afternoon, everyone. Welcome to Cross Country Healthcare’s Earnings Conference Call for the Second 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. At the conclusion of the prepared remarks, I will open the lines for questions.

to Healthcare’s call Relations. Vice like Vogel, to now Country Cross President would turn over the Josh I of Investor you ahead, go and Thank sir. please

Josh Vogel

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

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

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

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

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

John Martins

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

quarter, $XX high second revenue for an EBITDA million, ranges. of at the the of For end adjusted guidance above were year consolidated million our $XXX of the

an reflected are Our and me gains, This results clients services. efficiency environment ongoing technology dedicated enabling in and is best-in-class on controlling where labor our strong productivity healthcare professionals execution remained costs. evident investments to driving in that our our focused deliver employees

will of get Bill billable moments, detail few numbers, in hours. quarter driven to discussing performance. was and a XX% approximately the quarter, into I’ll Revenue our lower second more our rates with I but the on start business, first a mix spend travel. down by largest wanted

sequentially third line bill expected, rates to fourth XX% approximately pre-COVID single-digits on As track in high by declined mid and prior both X% in enter we with as levels average decline XXXX, in place would the our travel above rates This and the to expectations. settle quarters. are roughly expected to

As last rebounding. in we been saw has April and we delivery labor pediatrics, allied, we reported quarter, specialties. notable imaging slowly and saw in lab In demand EOR, pickups in in and strength and MedSurg, and dropped particular,

number the of in has slower anticipated. So been travelers than the in rebounded, third has growth the demand corresponding quarter

appears be still to quarter envisioned. we there expect Accordingly, revenue previously to the As we are nurses order softer rates seeking. in third the compensation little gap than to relative Though that be for a a open withdrawn.

to volume coming For needs, in see we months. outlook growth likely part, continue business. improving as a the for in orders, we fourth sequential expect the ramping as due the quarter, In seasonal to well to expect

number an second per and filled in filled. revenue quarter, I’d driven increase businesses, highlight other specialties physician in the our of up was which staffing to and like XX% sequentially to revenue XX% across organically day by days Heading year-over-year most the

of expectations, Mint a was our rate up also and of XX% our now rate include second performed $XXX Education million. now recent year-over-year. in run up quarter, year-over-year we very is on operate This XXX% of run an the well $XXX annual closed above acquisitions million. physician an to revenue which business more revenue annual to When most than Lotus, and division is continue

let on technology Now, initiatives. moment me spend a our

with technology you management As successfully our ecosystem. proprietary and redesigning our been in have we know, model real vendor using analytics center insights the of at that system entire a data-centric landscape provides our time, Intellify,

successfully of platform to have months. Since plans program introducing coming our event service Investor over year, Intellify our half with managed last onto the at Day convert migrated this we nearly balance the

paid of us dollars millions As fees a will this tech third-parties. in annually to reminder, save

margin for vendor neutral the the Intellify driver is states. However, opportunity within opinion, my multibillion wheel expansion long-term and opens revenue the in dollar growth

We’re level go technology-enabled just beyond labor as comprehensive, meeting conversations by data clients, offering with efficiency transparency. as labor of with contingent empowers the that and platform user perspective well a and intuitive analytics

we feedback clients, Intellify far partners been be believe from positive. differentiated We subcontract the our and received industry extremely in to prospects and has thus the highly

within For data of example, track which our staffing recently useful noted their one agencies marketplace is the introduces the efficiency helps very that partners Intellify tool.

actively call, vendor at neutral new As in customer. I Intellify that to thrilled find which our Today, mentioned talent announce I’m Xst. contract solutions we March on on May first we implementing the went another are last live

And on you numerous clients in live opportunities the have very so we’ve interested business forward pipeline our look this future on the far. calls. within done with new to technology we We evident demos robust updating

transparency. a we to it’s latest the technology self-service And for downloads allied pay our active job equally trends. of showing KPIs travel underway, applying app, of the released on version exciting mid-May In user, retention and the thousands and view candidate-facing Xperience professionals allows with side. been functionality model, have positive and and launch, convenient there which daily searching initiative Since jobs easily with utilize nurse

piece Cross transformation. of crucial a is ongoing Country’s app This digital

full an related our nearly initiatives delivery million we we a to mobile-first candidate of streamlining go-to-market platform, The further year efficiency. on rationalizing pivot improve well to will and ecosystem believe in technology models. optimizing target experiences that and we our operations $XX assist as As tech-enabled will client our continue business our strategy investment as

outlook. our to me brings This

of backdrop revenue seasonality the million. our like be in that parts we anticipate and market third education, $XXX will and the Given million between quarter $XXX the business

Beyond well demand homecare, in X%. adjusted a to quarter, year an that as potential for our third of above revenue businesses travel margin be the point and in of as approximately education, growth improvement staffing expectations billion our many $X.XX EBITDA continued and like physician full will

our growth I we in sustainable, to capital. long-term increasing our of focused drive deployment on remain and confident through are shareholder value ability profitable

in repay remaining $XX release, generation us on allowing fully the June. see in you cash our our to quarter, today’s As press second loan million in very term was strong

We million the will restoration of in plan also recall, our $XXX that May. repurchase we announced share

gone, we believe Share remain and are an now the With repurchases term our use of attractive undervalued. give shares capital. loan

sheet We will leadership care, did following acquisition like our continual robust also and across platform. the of well further hire as of patient look the to balance By markets with to as to interim new leverage diversify XXXX. entering technology we our late investments the like in

are we and which from ability about Intellify, closing, momentum the changer is build Cross the game believe upon industry. early Country to In and we prospects for a confident our

without of for achievable All our of each not hard them be their and want to success work would thank and dedicated our I contributions. employees

We incredible an have such team.

most recent Award to magazine’s Energage, workplace highlight recently and from I’m happiest which of and also We award won humbled Healthcare Workplace our employees satisfied. of where Industry organizations XXXX certification, Newsweek loved are Winner Top the most recognizes

workplace Our opinion. in to none culture is second my

collaboration, employees respect, various and support this award of the elements sense such as as the surveys And is on that belonging inside reflective of a company.

professionals make well our Lastly, all Cross as shareholders who in choice I company. want employer the thank of Country who their of to believe our as

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

Bill Burns

afternoon, Thanks, John everyone. and good

education. respectively, second the year both get the and normalization revenue Compared quarter, segments was of prior a to high the As bill million of for in quarter consolidated lesser performance and end in guidance above extent, staffing I’ll by few the on over minutes. $XXX range, to just XX% expected physician the prior revenue John across rates large assignment. fueled in of and into XX% travel more down highlighted, decline in our professionals a number details by was on driven part the and

was due at the reset a XX.X%. XX was margin Gross up points the gross And margin payroll of quarter of primarily $XXX represented to sequentially the profit tax million, annual which the start impact basis gross for year. the in

income to following lower we selling, as the down Moving pandemic majority down million, benefit well was sequentially performance the throughout the and salary the statement, of relates The prior the general administrative compensation over mentioned reductions $XX and quarter. expense the in costs decrease variable last X% as and historic year. X%

our third since quarter, the for to capacity market conditions invest highest profitability, the to and taken start initiatives. as of growth have second we’ve remains business of in our potential internal with our goal sufficient of actions future reduced we year, the balance proactively XX% Our while the to by start growth. with quarter well into than current as throughout ensuring headcount maintain Including the in while investments more technology areas continuing

well anticipate in Based will the to-date with third digits for as SG&A revenue, on our taken the cost lower actions as decline the the to decline we mid in quarter. sequential single high compensation associated

in of up quarter the decline was in last percent revenue, SG&A. XX.X%, a have the reductions As from XX.X% revenue, outpaced SG&A

with tight cost goal management digit of performance another range. The in $XX X.X% representing of our EBITDA better than single low high margin earnings to margins adjusted to an line expected adjusted maintain EBITDA with drove with consistent top strong the of coupled double quarter million,

from higher million, during lower partly driven $X.X offset was expense quarter, The rates. the interest average decline Interest was year. down entirely XX% by sequentially XX% the prior and which was borrowings by

under the was effective rate reduction for our the XX%, in ABL. Our interest borrowing quarter reflecting

third issuance as the of result term on see loan the lower of materially loan, subordinated $X.X on incurred prepayment the of And we our the the expect term of remaining extinguishment the debt therefore At end for for we balance quarter. and write-off interest the million costs. to prepaid the expense quarter, a

of effective guidance, XX% we and XX%. the reduction in associated moment finally, adjusted on was high statement, expense. Outperformance of ago. income both expectations to the driven million, income primarily interest of $X a overall income by above year severance between And in lowered I headcount tax strong statement, rate representing tax the restructuring $X.XX, end of in $XXX,XXX an costs, recorded fully resulted performance in the share mentioned per related the expense rate earnings the and XX.X% on tax with effective Also an line with

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

in business, XX% with line orders in through almost year. expectations down XX% down experienced for XX%, the Travel Nurse down year. largest the Our half rates billable from X% first Allied while and the Bill were sequentially, of the down prior softness travel sequentially and was following were we hours

The between the evenly year prior rates billable hours. fairly decline to and relative was fewer split lower bill

Looking continue mid bill the in to high decline we rates the expect third to to to single-digits. quarter,

expected are hours to billable decline low in While double-digits. the

Let me spend on a moment that.

considerably while total the troughing we softened gap out, soften, the pay As coming to orders are rates is average called start to and expectations the bill year, by creating continue demand before quarter which improving, a of second into gradually clinicians.

more seeing ago of seasonal not by improvement than prior As a to number remain noting when softer production, our travel with once needs said, the start worth pick again. optimistic on quarter months that anticipated we have yet few It’s up, the we we assignment see the get to That an pandemic. of a start grow as continue third we weekly slightly double this a travelers rebounding. than result, we the we in to we’re will

continued of demand X% business the with to hours. per Our and feel quarter, segment, more softness robust growing in billable the growth, diem year. Nurse prior within revenue to Allied trend approximately predominantly Education from continues our over business prior in from due impact down decline XX% local or the Also than the a a its

annual client. run to our remain needs expectations, to these services Home $XXX prior track Both down X% businesses a from care staffing rate though single each. achieve of year, performed million lower approximately due on of within predominantly an over the

impact their in Finally, acquisition was million expectations, year. of more $XX Staffing our sequentially XX% exceeded last which than delivering double the up prior late again and the year, completed to once Physician revenue, thanks

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

strong continued our total than flow, performance positive X.X less our cash to felt Given times. leverage and

plan. balance our leverage, under make in continue remain of sheet, we repurchase the positioned as With well incredibly $XXX and low to technology investments health our further as share an acquisitions repurchasing well million to shares

operations, $XX from $XXX from $XX with XXX% second record EBITDA. generates basis cash million in generated last our The year a $XX the compared a on year-to-date perspective, last year-to-date flow in operations $XXX quarter. and million million in From on that’s million cash highest we a cash quarter on conversion adjusted represented million

Fueling at this DSO, which drove XX collections now was further days. reduction strong performance in that stands

more the goal and towards Our year. to which second days half XX with continue we we make believe in remains that performance bring line that in is our DSO progress historical can the of below

in and anticipate a third portion trading subordinated plans being almost investing to during technology reflecting windows. investments. the continued in share $X when in in activity paid million, a Having additional XXbX-X in under possible the shares quarter. paying activities down debt opportunistic was used a making perspective, our retired blackout XXX,XXX our debt, Cash And our from $XXX we we ramp and repurchased financing ABL, expense down the million considerable of repurchases

our This brings quarter. me third the to outlook for

of guiding predominantly to rates are the as summer in representing decline $XXX softness on business. well of and the education bill revenue driven between travel $XXX our XX%, a vacation impact million, million to for sequential and as We by XX% volumes

to adjusted X% approximately adjusted million between million, X%. to margin EBITDA and We representing $XX be of are an $XX EBITDA expecting

the John longer-term mentioned we’re As to managing previously, has single a and to business not this quarter. success

between to business is margins, high believe is expected low on XX.X continue an of XX.X% stock-based and million million, rate XX%. and amortization this single $X.X XX%, interest assumed an per to compensation $X.XX of the margin $X.X $X.XX guidance million our count be digit Also tax based depreciation of between in can EBITDA maintain adjusted and and share expense and adjusted to achieve gross average We earnings share million, $X.X of shares. of of effective down

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

Operator

Thank you.

Tanquilut from Instructions] We Brian will now [Operator first the session. Jefferies. with comes Our question-and-answer begin question

Your line is open.

Unidentified Participant

take [ph] and forward? I front. that on just back guess [Knorr] get will be is some want Thanks. to MSPs Brian. a on Congrats moving this Hi, relationship opinion your get your on think for clarity love you to in I quarter. the step where with Would

John Martins

towards But last Sure. strategy. where the that where are part neutral to the a of towards to changes VMS. Cross in day now which excited to neutral and Hey, about right is in able space. very space. year neutral – flavor Country’s this what vital still probably that that than we has changed seen from the of that our marketplace, going back hospitals MSPs very now compete we’re in the Country, a Knorr And of in been sentiment right And it’s predominantly summer, to space we’ve market neutral we’re neutral throughout moving vendor in is vendor the moving predominantly prospects it be vendor MSP John. cyclical has since are Cross itself, been where and that feel and

showing – had the September, the our Intellify, to was Intellify to VMSs was But of for from vendor saw be able that it sentiment were we we a it a as the third-party we in invested in market into vendor pivot quickly we platform. When VMS Intellify was we the changed neutral to replacement at Day space, launched [inaudible]. neutral Investor originally

won vendor implemented our remarks, and neutral first deal in been come has then quarter, and deal vendor we’re the though mentioned Christenson, we vendor Intellify onboard neutral that business space, deal first we implementing we our by Talent vendor neutral business, second neutral. January, a as had who hired May, Eric And within the Solutions in in prepared a we in launched officially to my pioneer in we our and

there our prospects on an clients neutral out of about the it our hearing business are in is, other than differentiated excited Intellify from what management vendor market, to vendor model very with our brings market. the that totally and programs the we’re a – partners on we’re that because the So, from prospects, vendor is the it,

we excited selling really are Cross the client really effective it’s the what and at full delivered model most be about for Country, MSPs, team also them. sure but still working have that that want is we’re aspect, and but to they making we So sales the that

Dan White

bit this add said. little just Knorr, a going is to as Dan. I’m John

You probably about MSP just our the say, know, remains maybe there’s neutral would mix desired and XX% the and close of category. sort I to vendor are thinking strong in that between XX-ish, really pipeline MSP, the XX% neutral and XX%, this in more stay

Unidentified Participant

Right, thank you.

Operator

you. Thank

William Romeo Blair. hear from Trevor will we with Next

You may proceed.

Trevor Romeo

afternoon. taking good a Thanks lot Hi, the for questions.

in First, I about visibility. of kind trend to ask just confidence your wanted demand

to guide. the given and the you’re reduction the of kind step-down QX in year revenue minimum to guiding the full Just

So that bit rates the out you bit guide kind order extra And more? given compensation one, the guess a I conservatism comment have we specifically, you seeking? and front. into nurses could the questions just flesh that dive are on you about may any a into gap a built more Could couple of then of the the environment? know in

Bill Burns

Thanks your Bill. we numbers you give for you is conservatism? have this with do mean, most question, darn that Trevor in know, I confidence build I’d exceed. we the we I to I we to think is, question. start Yeah, can the continue try guess just our that which first

billion lightly was it from $X.XX something it took we wasn’t the guide the know not min to – to billion. You reduce $X.XX

the into the fourth and the up so, is trough. quarter we’d just bit quarter that second third net look our in a the softness of anticipate a week the of kind gets where The little as know context you or like still quarter. high has production of part as our at booked the we’re going question, hasn’t how But demand seeing this we bounced weekly into with third – market the rebounded. and production then in We

you of point read the squeeze bounce know the what that. third quarter. quarter, have, think virtually you trend that if quarter the it’s flat that implied the if of midpoint fourth say, third would fact, show upward at the that of this for doesn’t min I the in still would guide numbers Now, took it is out big not into guidance we it quarter, range. you got I fourth off an to a the off you

has headwinds rate in trended rates. silver said, in you deterioration a continued trough some order the have the still little since We’ve there’s demand lining know, still mid-April. the bill marketplace. there’s open up We seen although not That kind and pressures, if of in one bill

So those bill the over last it, months. been stable have three plus rates know pretty remained you call

We’re still gives into entire and QX winding us business the through what our QX. those book going rate and of pressure that’s really

John Martins

And right second months. – pay add your part the what equilibrium hospitals for there’s is the rates in are Martins, we question, this an is it to come Trevor, I will nurse what the now. expectation the – disparity And that believe that bill for a in would John seeing we’re of the between upcoming

volumes up start sides the the adequate part only the rate pay higher. orders that’s the picking will of bill few know you seeing rates. And will potentially to half in when and and in that’s start spiking it coming equal be the rate see start to you We’ll where we’ll and will pay be we rate demand the that both as year. where together seeing appropriate And the back know of really come bill

Trevor Romeo

of are was expecting that of levels helpful hospitals be my sounds in facility last the moderation. Thanks, now Okay. contract you now, with contingent and levels labor guess of a might know have operators I on some kind on further some the public I week, report they kind of follow-up like at comfortable the that color. just the the that right think John as

of how Just your normalization give you kind that your about kind if they broadly have of now of are they could process? you view us clients are contingent level staff where in know and thinking wondering of the

John Martins

Yeah.

to bill appropriate that gotten bill towards the rates rates down where trending that right XX% we’re of levels I that to the they’ve feel levels. up are down, XX% COVID the think majority are above opening trending clients especially more now

that think for And – nurses. still is still we’re need in terms hearing that floor of the on there the volumes, more I

them And so a now volumes. hospitals get to right are I we to strategic in see willing rate, has as to more the help travelers and key grow their bring think to that revenue that bill

Trevor Romeo

Okay, it. thank was you. That helpful. Appreciate

Operator

Tobey Sommer with Our next Truist question will Securities. come from

open. Your line is

Tobey Sommer

play Thanks. that anticipation typically seasonal I the you perhaps wanted do higher over into still rate. that’ll come your winter any ask have or that for is that the about and What’s point you this out at to a in visibility orders slightly forthcoming? of how

John Martins

Tobey. John, is this So

the Year. forthcoming. we’re seeing So on through What through them right part our to seeing and it’s get get that bringing now, them looking still early of the will contracts the clients we’re season XX-week toward New flu

seeing flu we’re little And sentiment so and trickle clients, out the needs. And you we’re and is we’re seeing leading ahead previous winter looking that the are to if of and that more some trying and – get really pre-COVID than but bit needs. of be needs or will we’re there planning a our the of in more seeing of of that we’ve from seen XX-week winter preparing will, as still rather a further just time, getting

Tobey Sommer

to be just And clear.

how number or Is into that and is sustaining we that of XXXX, in As is quarter this annualizing think our especially – that kind about point? fourth influx how head EBITDA an higher margin. is we at it X%

Bill Burns

Bill. going I a Hey, good XXXX. that’s to Tobey into Yeah assume think it’s rate run

potential on bill we’ve some is far. but been for the how of not course expecting out I think we’ve modeled rate there know you pressure, so you close rate know bill continued pretty

way. out that plays So that

ability volumes so offset the local know pretty of that’s like you it think robust and a comes that education lines down business headwind for to and good I have the been other a off or growth If point. then tenants little really forth. there’s jump having to

Tobey Sommer

more people something of vendor are like many MSPs you we’ve Love could churn or deciding half looking a perspective and neutral is do vendor still about kind and there’s staffing you MSP get lot than kind come? that the even seeming through at post-pandemic to your to of what we’re talk likely in about to way lot stage. And think led heard churn the of this neutral the move industry to a

John Martins

This John, Sure. is Tobey.

halfway the towards probably churn is, over out vendor I has – year turned we’re there towards sentiment through last the the think through vendor platform. the in market. not there neutral the moving going The neutral

we’ve important us space most, And be of us having for a had implementing both for that Intellify come first to as as that that those historically losses share to the and transparent the two in of launch wins well reasons able vendor neutral is to it those year pretty been market higher play the why for to we to we’ve churn have seen is and and players. earlier space. one mentioned the key that And I in to gain our that’s of

that XXXX-XX And, MSPs probably into become well point after came XX:XX VMS. for between VMS saw we actually moving neutral and due it’s year we the tell saw at now I’ll period rose, them difficult. pandemic the once act then very it’s a split to affordable towards of that to you the probably the five as moved play back and MSP day and recession about right vendor in care flavor XXXX-XX great

looking led neutral. are a point, yes, even MSPs now lot And vendor strategically to like your

clients that churn with ourselves, Now and/or have over ethically great we actually most we the years, lose relationships what and first. our we’ve X perform that’s clients to how why cases, I churn acted received client because which a developed still a we even not Tier bad orders the means for you when we’ve and do we’d for of the had some and long-term become in here’s even such we how tell VMS, preferred us our actually vendor of in

when of on we’ve MSP, one the portion that, do other platform, have in whole go there’ll able and many under we’re and the will in to And is we churn consolidate then when a large this times MSP and these systems Tier only another there, clients, thing be system. health vendor seen they that X be be a

last to year now that had one actually assignment. and on have have access now travelers lost we had system. because MSP, more we In We whole we that the to former

answer vendor we So, definitely yeah Intellify to we go with it Cross think the yeah towards seeing very neutral, well more question, Country we’re your to position rollout.

or label market create technology apps Intellify clients’ white neutral Dan, pools with that something? this to all well our resource the pool got to technology and space. technology believe to positions for us own from Intellify as internal support you capture our internal to vendor utilize a shelves churn We travel or well their

Dan White

more or happening are a supply I little where will, churn. this contracts Yeah. because just on back these get sense, to if track Tobey, wanted right, to lot right, of activity. to you is when was of sort chain add it’s And bit that color years. typically to you they’re neutral that this one no it’s just that taken makes remember to really idea doing important of It’s three anything through activity vendor just not, a the that with pandemic, hygiene, consideration

know So, of activities lots lots activity. you and a kinds of see a all RFPs expect to be there lot of from coming We of we sources.

John Martins

add probably has And this just again, Tobey. is, would the ever had that between seen. other the neutral John Cross MSP is thing this and I vendor biggest we’ve is pipeline Country

market. like they’re and they’re forward what in are the is which it lot moving reevaluating do to healthcare seems bottom And with. of churn going there a all systems So

Tobey Sommer

that – all for thanks that And context.

share winning marketplace? – or activity in that follow-up. of losing those amid all Are you the and pipeline all a as Just

John Martins

you but a bit You know, you right lost know now, factors, little I have couple of think we right. share, probably of a

down. coming bill volumes coming down, So rates you have

know spend MSPs you vendor still and our adding We’re neutral. well in of now in their $X over we’re billion onto management

just gain we you long-term I the we’re as as space, quickly bit little us neutral know vendor getting will I a up. into get So think I think for this is to that think we’ll and make

Bill Burns

Bill. And, Tobey it’s

a called say, for obviously think You live. we’ve the early the quarter third neutral the out of by roadmap know – to I one that question process. the spend a got being we convert state on I asked I’d live, think vendor XX% John be implemented. We’ve the in much still north number where Intellify, innings it’s of program got and will I converted MSP got we’re of you mean so that more already end XX% we one

innings early it’s Intellify, it’s strides. but making great for So

Tobey Sommer

Thank you.

Operator

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

Your line is open.

Bill Sutherland

work, usually? rebounds the can us. you quarter. education remind on go strongly. through you. just seasonality, guys Nice know Thank the you What I see do Bill, XQ else

Bill Burns

businesses that could that to play But and mean there. fourth quarter, the historical, is historically say there’s seasonality expect usually in not we out, because see I the I tailwinds tenens this locum quarter, such decline going that what fourth quarter not locum probably in would growth low we’ll see single going the fourth sequential a anticipating actually the say into that. small sequential we’re I see would business. in digit some

year. mentioned, Education, of off know point come you a, their you the they of lowest

be could sequential fact, growth quarter the that be the XX% about XX% down In because school XX%, the there’ll sequentially of fourth but, new growth. going into year

think really in usually that, growth bounce even the before quarter good than were we’ll there. they see up higher So they so I

or yearend start more quarter seasonality local and cetera. in it Thanksgiving then actually to tend little you tend Christmas, our see et And slower don’t say, go impact fourth first you holidays, know us a a we the as bit for holidays the New little The business, a through travel Year, a not, believe the the business, lot that’s bit I’d in to of of the quarter. to us,

impacts we’re general the through are those the fourth quarter. that seeing So,

you I education a muted come local a will side tend know have tenens They be of this in think I on bit tailwind. and locum out. case, the mean, so little have headwinds to you you be back,

businesses, change don’t big seasonal numbers. want So in to anticipate I drive a going the the to other that’s revenue

Bill Sutherland

is business or John locums Hey, do Okay. your physician staffing replacements? have still recruiting all you now

John Martins

XX%. It’s

market and and and one high, locums can Bill. is excited I know care, number. that for education It’s a XX.X% locums, we’re that’s probably along think is you a good we’re it little. it, where very you those of with the of it’s home give majority growing that It’s businesses very Bill areas very look

Burns certainly and our when XX% Lotus, as locum make diversification $XXX business XXX% grow become year-over-year it’s a we business And is and player going business that a of on interesting the major And much business, it sort acquisitions as organically. we business we that higher well. grew of certainly be Cross into million Bill more education and A with as at it’ll of we’re of business done that up XXXX mentioned, will so Country. start Mint you the to to locums, is in it’s acquired XX% space, a looking business million a us, but be and year-over-year our for revenue, that $XXX that’s well a

years that Our is ago, little million home we a a that over businesses. required $XXX be business two a care business will over

looking it’s Cross of just four level we’ve So, an years, amazing such and been happened. of how sort Country, in at what’s and really different a really over past executed turnaround the

allied we and nurse these executed market business still and but pandemic or we and had allied as know we’d travel what currently nurse whole the today. - to look during at yes above business market we’ve and believe tailwinds COVID at You

And level we as the to and it’s our have come sorry I’m executing – have high business year. Cross if nursing and volumes look education a execute at in to level. care continues we rates and our anticipate those were home all and at a Country now those towards is the our the and our obviously very locums, come market high down nursing down the take bill travel while right market it’s

So the very about excited Dan? we’re prospects.

Dan White

would asking about a sort add I of will. little if were I color Hey, bit term just you since placement, some Bill you figured

the sales really note new selling success, have. cross addition making, we’ve great that whatever important that to already it’s we’re had to in into think accounts I we

So, you know had added different we’ve into XX our client base. services

that we interim our of those on Six John in got also kind our are are but really in of program mentioned, you at I first Intellify. leadership, locums care as also live know home that all accounts. nicely go And figured business, doing you search know pace out RPO base

really our businesses, pay of now platform. you tech across know are all it’s cetera the on that hitting centers, So, getting, same all locums, et

Bill Sutherland

neutral? back second that that for is your a centers pace Dan, vendor does Intellify –

Dan White

That a and is implemented is new No, that existing pace not an customer. customer.

John Martins

or actually an to this MSO is going That one. MSP John, certainly is Bill. MSP And that it’s be

Bill Sutherland

mentioned, of think insight just of nurse I’m kind with kind allied? don’t kind and that’s I of I curious is, how sights Allied doing Okay. and

Bill Burns

allied on the been steep. size say plays travel been well north volume year I’d our steep, the the know the travel good say to – the of reductions well when out. Yeah track you the But a as haven’t would rate be faring as I it that trajectory side haven’t and a million declines and north $XXX mean quite business is actually at well business. ends relative it’s look that that of travel I how you of to It’s of depends

Marc Krug

This the little see surgery continues X-ray, robust just know to services demand. path also heavy add a continues Marc, of very pre-posed to more. the space. cath MRI, term you the on see to cardiovascular it Imaging demand is very lab, to Anything demand, related allied high we

Bill Sutherland

up this with this then expectation. the just and wrap going just to with their pay here And revisiting situation nurses revisiting

So [RECs] kind you pay progression the the to get you’re [ph] – out they you just figuring actually that REC. you that unfilled, hospitals natural rates give to as put put that’s you’re And fill the of go expecting? the frustrated, the can start know just

John Martins

of I think, it’s more a combination.

increased pay as down. the the Their the coming rates needs I bill think, quite are are building had these going rates crisis needed now pandemic, high. throughout nurses them. rightfully into as as and these with expectations the going we right, down, And burning pay during

– above XX% bill agree happen think we still that in natural will, to demand they the rate. people market And there’s where will XX% continues where will increase. will the on of think hit that, the where understand to as I that’s rates settle So levels. pre-COVID pay we And that, nurses will we think a now will is

know demand, to some that need bring of and at of we have on we our fill. will orders where and need of of their fill the open to probably – below half say about hospitals are I you maybe we would the them market So probably half market half of where are them

rates market, higher of up. So sense? are that nurses But those we the market end of that the the where expectation will will the below market that come come yeah, we also some rates to those anticipate do on more down the anticipate ones makes pay are. If

Bill Sutherland

Yeah.

happens with John, what in case? so the And that spread,

John Martins

very a But you the more line with down – we pay with a have see that – pressure gross But margins. the pressure the market, sorry. should not with seen on you have said, nurses to the on us in could little spread amount come I’m of a margins. because with as margin The on will tighter bill, tremendous bit this know little pay point, in to gross the spread, impact up

Bill, if So to know I you want –

Bill Burns

points. I spreads. that would quarter, for as up down second the that of just a to well, because basis the housing over add Yeah. Bill, what pay we was year-over-year is on saw margin that gross It’s part XX important holding bill include was

a the it bill to spread know bill is some that holding an take down, we’re as slowing up rates decision assignment. you So is making the of production folks down for pay coming seeing but are

equilibrium two pieces So into you’ve those settle to John mentioned. need got that

Bill Sutherland

Thanks Okay. again.

Operator

of come Bank will Fischbeck question Kevin with America. next Our from

open. line Your is

Kevin Fischbeck

guess, initial moving I that you visibility like when about I that driver? this another have year. hard the you you shortfall to materialized kind come visibility kind question I maybe to Okay. that’s expectations, you today on down? that an your of have. back feel this the about guidance versus And think has guess that just fully that is want been? that to And cut where Or still has you go where of second target know better influx is do time you

Bill Burns

was that travelers see improvement that the regrow it seeing starting ago Bill. we months bending seen the curve I to the modest the off, quarter. quarter, Kevin, few it’s level on to the some not Look, number assignment we’re wanted. would expectation third we Hey, throughout in earlier on degree We’ve a of think and but

what coming still be that’s third to It’s the be is. So, to back – really saying, seems quarter it the trough.

in – the we improving, bill outlook stabilized demand that market, still improving have improving backdrop. have The in rates the

that it fourth you it’s expect, needs quarter. to So that every we as we’ve seen And you year. get points know something the seasonal

through. side. So to is the a it that bit fourth point of come uplift on That give volume make to the expecting actually turning quarter we’re that will little expected the

Kevin Fischbeck

does it, of are that waiting reason these the maybe on more that point, XX-week Or why mean, that John guess that normally made And would are be and to it? you orders orders, some them earlier just think a in the I expect I expecting? you that risk I increase that that, about waiting is be people would – be see there time. the people won’t increase seasonal on you that

John Martins

we’d would XX-week start volume. entering start it’s historically, clinicians Kevin, in, two coming to winter or flu August, season. more we the Two flu hospitals come these the pre-COVID, is, parts. by now So certainly and higher July in the seeing longer. orders But see a seeing in much come as want But is, parts for now we’re what we’re seeing in in orders lock

That’s their are just They’re start not quarter. the that we will from and is to now, and to little the the clients a first waiting want our clinicians that, how then fourth labor. quarter just the orders, manage and needs now they’re hearing into to see happening these while we’re they receive them going be sentiment because contingent closer waiting where in

hearing infant, group for the when more. improved find will – out X-year many depends RSV, need group also and approved will depend get what contingency or clinicians The approved. will other can we market that thing will they’ll hard on an we’re if there the last a hit on also older, for, need It less that, that for be vaccine come pediatric will how if age for hospitals for old going year, which be there only age approved be, now is is that it’s that what is a out the is approved it’s they because to labor,

couple So factors they’re there’s a waiting. why of

Kevin Fischbeck

thanks. Okay,

Operator

Thank you.

Our A.J. last Rice Credit from will come question with Suisse.

proceed. may You

A.J. Rice

like travelers But like it sorry on the expectation you’re in you people if had and more little today? trying Is phenomenon I’m that orders But down got I beginning at Thanks just I that in Or QX, sounds It’s it the if on mainly pricing. were right. about go-forward duplicate I to out this. to X% assignment fill those bit, right? everybody. that orders, Hi from there. unwilling so a QX sounds you’re that this were higher saying call because they became a missed is

Bill Burns

It’s not to perfect clear. a be correlation

quarter. production that so fell we as going weekly sharply is following last had that orders we’re the had the trends. order signaled rebound there. seeing We TOA the not quickly to as in think ramp just said, happen. orders The I decline But So was in

on enough a issue back orders. travelers than there’s of timing it’s the assignment whether building rather So

There’s a able – to talked the bit expectations orders think, assignment, pay the it’s open are about, John be the put about orders little the relative to but that back there, I of what had on today. are to there travelers

we as as start every we we’re quarter. move So that see the the the of expectation through grow into have TOA the quarter to we fourth going and get

A.J. Rice

people back summer they’re phenomenon fill hear off. they Okay. to so some the and the for come money making in you’ll more orders? maybe this We see are a I any X going mean of travelers Is anecdotal fall, these when your plentiful mind things are I’m then that stuff they ask. these a that to travelers if there’s haven’t summer much in but take of questions, of months, dumb this and supply the couple for engaged and of

Marc Krug

mean, a I of we see Marc. that. little It’s

not I think taking money seasonal. the think or made notion not It’s and time will it’s three actually off But that’s – time of is travelers two overblown. I the Most that this true. they assignments and off. they’re little all take very do a our just

A.J. Rice

Okay.

the hearing of are hospital their hiring that is side accelerating thing from labor. we they’re Another permanent

a and assignments, are them on? of you of permanent As that been are assignment? what’s part that through go run people percentage finding going you in to choosing that the back to for environment back travel just traditional this Is recruiting their you’ve

Marc Krug

part. That’s not large a

that are back But Nurse always there’s who the back. into we’ve who the gained now we’ve – pandemic who there’s portion of travelers than the came I nurses course, marketplace during a going were more to jobs. say pandemic, nurses the going lost Of Travel would not of pool into permanent because there’s their

gone stay travel And portion market so have flexible still be nurses so and to had small most but workforce gig to in yes, economy. back, and want there’s that that that a part the remain of

Dan White

I RPO would at would A.J, customers though, has also it said. just while – with add client have our an base so this I area, Dan. disagreeing mention our so is and two don’t absolutely I’m are functions necessarily And that to. been anything internal that’s their existing not you better and getting ramping this. that’s you own up the and might TA be mixing

John Martins

this to still down some nurses. these pre-COVID. labor cases, are were shortage in most there But is the Well, be contingency an have this a that’s where still permanent going is spend their – Yeah, clinicians, contingency bringing in said, such of that hospitals issue spend, of John of again, that A.J. and still, in have bringing tremendous on nurses, systemic reducing bringing with job the double particular, not The by hospitals solved they that nurses. in done a is issue of there’s

lot still there’s a for So contingency of need labor.

more And there’s for of back in saying, nurses lot frankly, especially business, as jobs. Dan perm to the need was still the RPO into go a permanently

our and excited very So industry. I very think this is we’re upon why bullish

we’re has the rates in XX% While travel couple the quarters and bill will come in normalized, during next to XX% and pre-COVID of coded, we’ll levels. nursing to where plateau back above leave will seeing now normalization moving

to are aren’t solution issues future. coming bullish the will because demand seeing -- sequential just near growth in we’ll build there’s the the get we’ll going not start data the it’s a start and balance, tick this pay the report, year. solve us for during the throughout or we’re out, is back and surveys and What BLS and excites that see why the up, we’re the those back equilibrium the of that systemic half And problem to away. Whether the

A.J. Rice

Okay.

ask just one me Let other one.

vendor-neutral getting called Because you wonder, up-ed be perfect me, I to On like you the really comment on forth, to about before to and competitive so have did on had the you’re before, MSPs seeing it that. and has to seems Intellify? consider more you bid side. there, your willing game and vendor-neutral hospitals alternatives view in made Intellify

So seeing thinking they vendor-neutral it I’m in ways, to may about want shift already not? wondering, are Or have, people some the way or just a are in more of really try you whether there? indeed what big out is been

John Martins

that now is more because have didn’t having programs This a have wanting that to we visibility offering. before And are to the we hospitals John, Intellify, we prior had all vendor-neutral A.J.

when vendor-neutral we in so, calling teams, multiple with and didn’t have And when client MSP, were were a our MSP didn’t sales essentially we sales we from a if vendor-neutral the a and when we sales MSP, team, perspective, teams the want going perspective in shut an have from down.

that offerings, X VMS, Now that vendor-neutral the able seat different table. that to go a we a having we’re we’re to and are have have and of at visibility focusing on which on clients getting

Dan, to want anything add to do you that?

Dan White

Sure.

with, than are way. to vendor-neutral different “Gosh, had a “I had So about to I whether And that’s services, what saying, support just MSP traditional of services”. I or coming the solution in”. and Many set us A.J., with this a more wanted pandemic some who you more might staffing-led going additional they’re something think it went coming now us also I into wish customers

two, having for there the I’ll alternatives go-to-market; of pandemic, I example this available customers, of them – seeing that technology is some use pool tools to number So that resource and the pretty out a had and an now that do that lot not the have us that built internal a prior have might allow to before. think just to really number they sophisticated of that. wasn’t lot one,

and you and one one MSP”. agency to that, other travel those internal just this capability, traditional more a is and like me tell on just just very is for “Oh, lot anymore. this It’s that a hard not coupling So vendor-neutral, sophistication. purely purely It’s

the a much more and proper-sense have client. in We needy sophisticated

A.J. Rice

that’s Okay. helpful. No, Great.

Operator

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

John Martins

to participating Thank thank everyone closing, and I’d next company look you of forward for our like on to In call, call. Sheila. in we you, the today’s progress the updating on

Operator

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

disconnect. now You may

Cross Country Healthcare (CCRN) 2 Aug 232023 Q2 Earnings call transcript