ADV - Earnings call 4 2023 | Advantage Solutions Inc.

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Operator

Greetings and welcome to the Advantage Solutions Fourth Quarter and Full Year 2023 Earnings Call. At this time all participants are in a listen-only mode. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] As a reminder this conference is being recorded.It's now my pleasure to introduce, Ruben Mella, Vice President of Investor Relations. Thank you, Ruben.

begin. may You

Unknown Executive

and Advantage operator, earnings everyone, joining for call. Thank fourth thank quarter on Solutions' XXXX and us you, you, full conference year

to On federal Chris Choksi, Senior Peacock, President of the factors, fully All which factors. are Growe, a management securities update me we M&A. described call Financial risks more their Vice the for These Dave prepared to and and Officer; meaning statements, a undertake the after annual may entirety filed non-GAAP call, make expressly and the this company's not those several results difficult The are financial contain by Actual Chief does the expectations due forward-looking outcomes Sean Executive open in certain provide required Chris including as Dave measures. in based and predict. will Officer; of on remarks except statements revise qualified are and Strategy SEC. or are session.During call note and today by with the Form laws. statements with current law. will such upon their management's within report forward-looking XX-K statements will materially company Please question-and-answer Chief today remarks, uncertainties management's to could any that duty assumptions, involve any forward-looking differ

these to website. on non-GAAP Our available recording earnings most measures Investor also a of being GAAP early company's Relations financial call will reconciliations issued the is measure. and webcast release presents today comparable the This be

and turn the website.And remarks over Peacock. We Advantage's the the CEO, now also I'd will Presentations reference the prepared during to Events IR presentation call Dave to like available of section a on

David Peacock

to brands retailers the our an Thanks the needs Ruben, to on remain strategy time, long-term thank as in margin and our meeting to quarter. to and consumer profitable as of we clients EBITDA deliver XXXX and began keeping everyone to fourth for year same and pleased promise execute marks you a our by were a good guidance partner adjusted we maximize full choice in Advantage year-over-year us. for important Solutions potential joining exceeding the morning, and growth.At growth especially We EBITDA expansion focused shareholders XXXX. of our drive adjusted

XXXX relationship pivotal review we to a in of to strategic value streamlined with driving fortify them demonstrating category merchandise. date consumer of shoppers and and our Our We opportunities with XXth and retailer's continue industry for strategy, will operational behalf have our He with processes, toughest online hard as with business general with customers after as with share be US offerings our across in for plan XX providing in a team its trend in-store together renewed a we relationship large provider for success this heading long-standing as into expand as will actions exclusive the help our convert dedication winning through leadership key company we shaping with service their executive challenges. customer. of their enhanced will re-upped annual to improved packaged partnership to many with collaborated Chief and expansion good momentum solve relationships.One XXXX, goods year engaging retailer them supporting and he shoppers specializing rigor, many both welcomed McRoskey strategic with an services several the us will growth more the will excellence.We late in executives multinational a Advantage buyers Bain example Officer. the their us existing Brian this all agility capabilities.In mark adding Growth and our where our capabilities about years with XX year joined we January, efficiencies spending. expanded digital Brian contracts feel new help is executed who more more our sampling in a identifying beauty agreement long-range to efforts.I believe now I in and organizational experience.We team leading of shareholders. Advantage to demo centers unified of enhance these large across for the in-store retailer XX% majority services few provide for more be some take This our new to events leadership partner, enterprise and accomplishments stores.Our significant and conducting the minutes create a service to everyone a into touch this US with our long-standing experiential our into to including on clients day, significant than relentless thank also each respective enterprise We enhancing sampling want their teammates on XXXX, the exclusive

businesses better European representing for balance sales Action categories further [ph] and to drive serve Crisp, we help and a to enables automation, in impact With in costs global scope the leverage were broad Advantage minority us data of platform, our ongoing other we of will access and systems, the year.We and gives and constructive of office two combined we course with to joint expenses, first Atlas our launching our allowing leader provide sales global This the management Group connectivity our and an exchange known its years, with the October, cloud-based technologies, stake services, delever total our with which us we new companies programs, to are January, Services. steps empower one group.Finally, portfolio, helps technology third-party beauty suite will Consultancy we that reduce operations our and their with as over in team, award-winning we brands, Smollan our while streamlines our IT capabilities, further, and clients. technology Partners. new signed agreement and will companies stake so back-office adjacent to key provider Limited, industry, offer Advantage pilot of an Crisp collaboration, and the brand and and venture. modernize acquisition Tata us data proceeds we the considerations. with sold X.X% AI retail simplify and recent We've million, CPG as to We to IT majority data-sharing are and business Advantage, Waypoint completed core and to stake CPG into The an to businesses cash have continue industries.Separately, last example, benefit and For coming collection which for help advanced partnership, our platform also the reduced Foodservice.The continue TCS clients.The of to receives resources entity, partner the Technology with complements where customer across our gross of Foodservice expanded with XX.X%, clients in analytics, to Advantage complexities with more growth.In services a sale. joint Smollan Growth transform customers.We Smollan health for clients to value. an services, $XXX our focus Foodservice with our goods the opportunities modernizing will divestitures us transactions, range of in and nimble, expertise to technology from optimize delivering the the is capabilities services clients, we part enable complexity a footprint.All mostly and client of will powered to in approximately leading of also business Prospect expanded new and world-class competitive sophisticated optimize our commitment divestitures Advantage cash services, agreements, enable in enhance of stronger, businesses technology these us digital we transaction in businesses. core supply offer a to notably reporting taken better a collaborations, more sold providers, Hill Genpact, venture also retail food, serving retail with back group customers' chain can entered reduce to They sheet. our expertise and support simplify with its collaborate and the ultimately on make more key and our consumer most several innovation evaluate

have a for We of record lasted success with decades. relationships that client have

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demonstration continue our in to turnover creating retailer Most that improvements on these approximately a hired culture XXXX, of We in-store are our frontlines remains teammates, XX%, with and enterprise, as business. sampling Advantage tens over of rate employees over year. and employs with XX% trends, improving improved X,XXX new thousands talent prioritize business quarter consumers. of reducing business.We our and continued in We are are with turnover demonstration our fourth notably, across employees, significant to the whom most merchandising part-time our approximately committed our top pleased in and the improvements businesses.We with by retention in the the improving merchandising attracts year-over-year net across in supporting

in and and based and more we the brick simply, roadmap position many transformation believe macro trend we understanding, is and That and customers market seeing challenges the e-commerce, efficiently brands competitive we and can means, provide face. cases in our major services with the than solutions have of services unparalleled Nearly, our of opportunities, retailers, expertise, of customers.Put offer and they at and an better faster, understanding landscape. themselves. with comprehensive strategic every environment, and today, to clients we're the and our can trends Our aligns on intersection we market the a mortar

experience, can some identifying face growth. their Our of agility the speed, while to and paths help offset businesses headwinds depth new of

in and stabilizing, unit XXXX more levels. manufacturers and XXXX, brands with shopping distribution are and CPGs advantage seeing of for partner on are we expanded a brands as with with Pricing early some in focus retailers, This appetite unit retailers and and given count as of In innovation from top serve declines indicators we in to innovation QX well industry. the innovation continues categories seeing encouraging of for this listing which private key growing an almost advising XXX broader for trends expect care personal nearly expand that our typical clients desire XX% volume XXXX. growth, normal planning and retailers.Second, we Here to today the and and on.First, patterns. see Outlook manufacturers to food inflation SKU we And of a reverting Survey bodes dozens CPG business of signs the category food increases.Our most our the are for more private to encouraging customers growth, to for retailers indicates drivers.

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are unit the for They're expansion promotions as private relying on volume drivers. the and growth. planning brands Just XX% of

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interest persistent months. they're conclude to XX and loan are in this execute However, growing consumers to two of of time in manufacturers levels segment of retailer consumers. over the student excited to them Manufacturers store staffing the meaningful high and their different the opportunities financially to current recognizing impacting need expected of plan US is surveyed retailers we and consumer with me distinct in planograms changes the we while shoppers. are team.Let are the at A sets stores same in retailers managing more stating and of pockets requires there ahead uncertainty and repayments needs costs. indicate continue Two-thirds return by rates retailers to able strained sets This strategic shelf different next scrutinize satisfied about our XXXX. help no services to are through meet cater

execute As growth for our we activities strategy ramp up to acceleration.

We growth. adjusted EBITDA also and expect revenue

impact the the divestitures. of completed Excluding in-year

and retail capabilities, We in cultivate consultant Advantage generate when are demand brands end We physical generation e-commerce over intersection and leading shoppers as into Chris more and is it market is no and to converting outlook. the demand buyers.With right, on spanning conditions CPG retailers, buyers essential done the solutions path ecosystem, national and end delivering every purchase way that sticky that the private and and they brands. serving fuel steadfast customized at that the and our performance enduring growth. national relationships to strategic to across to turn mission financial shoppers a brands I'll for of know our into matter turn consumers uniquely and shop. are leverage retailers, positioned in We retail for

Christopher Growe

you, Thank Dave.

to underscore baseline Our XXXX recent the talented for I what business. remain of growth. about new transforming collaborations come the our service divestitures and is team strong in with a excited Advantage, expected for our discipline

financial performance. to me seen our insights into results, You've allow highlight our four so

quarter. an especially Adjusted the was quarter. and improved fourth in $XXX million for XXXX, EBITDA in First, performance million $XXX fourth our year team EBITDA in the the delivered has adjusted

growth Excluding and sampling an in-store, segment demonstrations. the of XXXX, came a decline was foreign driver the the of marketing of X.X% exchange divestitures, recovery quarter.The from to and change due the year-over-year X.X% in increase fourth in continued

of choose in in-store and the events XXXX As XXXX most many counts box US volume.In retailers fourth XX% year-over-year and reached representing Advantage grocery day. sampling big event their quarter, represented event increased which XX,XXX is of as in XX% levels, approximately a experiential provider.In-store reminder, Advantage per and exclusive sampling nearly largest of marketing pre-pandemic total counts XXXX, XX% the

good showcase sequential XX% repeat recovery wage both million XXXX. a over actions year product pricing represented business implemented relative revenue to to first item.Second, the the impact inflation accounts. helped incurred We their initiatives XXXX recent produce and of retailer These study, financial a benefit In one-third pricing approximately majority tapering more than will and our in of we shoppers reported expect comparable XXXX actions wraparound the FX purchases and We making of on simplify excluding influenced to growth in offset the pricing performance. continued actions decision feel the inflation.Third, segments of continued of that an two-thirds taken in sampling course the divestitures. benefit had about they $XXX and said of the the of

the $XX including and divestitures was EBITDA, million $XXX adjusted joint and approximately of For million completed context, revenue respectively. impact from in-year deconsolidation European XXXX venture the on our

quarter actively a focus on in capabilities of to cuts divestitures a EBITDA even in the offsetting opportunities core explain to segment and and efforts in additional the inflationary budget sheet. activity exploring the full our benefits are decline year.Moving in margin client due customer, performance the balance the adjusted the exit the large and the revenue from sales XXXX pressures. partially reported a our and intentional our These further.Finally, cost was to to decline year-over-year aforementioned offsets for We

rate ratio in the reduce We opportunities higher to continue interest environment. net a to prioritize leverage

the quarter, adjusted relative For was XXXX. X.Xx the fourth of to the X.Xx at debt beginning EBITDA our to net approximately

capital from deleverages allowed net below we three an monitor a working leverage unlevered and management, we million to with to while ratio continue secured notes emphasize Our profile voluntarily our free of In convert attractive will adjusted the approximately loans have years.During favorable current XXXX. the meaningful sheet debt levels next to return. for is term rate to to objective healthy the quarter, to in of line to which X.Xx.We quarter, prior us of EBITDA approximately generating the $XX deploy and maturities that discount long-term repurchased flow capital reduce a XXX% adjusted opportunities combination balance and remains the continue no cash at in

our outstanding with December by total steps discipline, hedged billion $X.X with improve remain the fixed XX, to As our steady of nearly year. a interest our this funded of approximately We was backdrop. for that rate.Turning combined debt pleased debt at deliberate to a XX% financial economic or outlook

in of EBITDA believe in We weighted for impacts in As first investments such, divestitures. low running and adjusted the are which the which to and half.Our of of inflation completed EBITDA adjusted persistent after continued planning towards accelerated wage to rate. revenues currently technology to we the guidance the currently the single-digit pricing, help year offset realization growth be a can half we the single-digit mid second talent contemplates considering low is at performance due expect

expect we and recover to sampling levels toward grow events XXXX. We in-store demonstration as in pre-pandemic

XX to year.As on with more doubt continue ensure the for and will exits a us relationships year-to-date. client our weigh also core attractive considers we've quarter. leverage divestitures as client trade for in long-term strategic and effectively necessary there our EBITDA completed benefits strengths evaluate two stores the throughout of for more of scale on growth. XXXX These reminder, offering, To revenues to the we XXXX incorporated to achieve We impact that profitable them our this times first a operational client chosen guidance their assess Despite than avoidance channels. view priorities. nearly support outlook needs We in exits XXX,XXX X,XXX and is muted portfolio enable address and to in to exit of our the adjusted CPG across and we to our into goals.Our clients for retailer are brand end, over us have the breadth which unmatched allowing economically

However, part employee We've contemplated X.X our period take million of services technology we of further. undervalued and our we for our be old tools of in price.In to is operated systems divestitures cloud.The enable be the in of guidance to to not three-year business foreign capital life. of million repurchased information efficiencies. to to platforms believe its strategy, investment impact for for model, organization. to useful simplify we does stock include modernize, new as a far enterprise-wide system related traded differentiate, approaching over in of and end data operations cloud-based the operating what advantage and mainly more to is capabilities, that may investment remain transform way build plan siloed significant of additional XXXX, portion an incentive will past Under dilution incremental X will the modernization, the Share migrate repurchases than be the an improve the the planned offset of ERP structure beginning we the fourth current upgrade small asset XXXX.XXXX is AI, approximately shares largest to million X including so and $X.X those a quarter. shares repurchased upgrade initiatives and million shares A the our the compared to our other shared

fully along to expect XXXX.In we XXXX, expect we with efficiencies, a CapEx deliver a system improve is these We we service of our upgrade our to spend upfront clients. to all we our to result modern by simplify system ensure clients.Once implementation necessary and integrated operations through million $XXX considerations, complete, $XXX reduction, of upgrade cost to in to expect approximately DSO complete of that million best-in-class We to the believe the internal technology the sometime responsiveness and believe business terms related in initiatives and XXXX. savings will financial to

our over in income one-time to XX% occurring adjusted demonstration phased year platforms, near-term, take ramp-up investment As avoidance plan represents other IT actions spent capabilities, spend an view have TCS to looking million guidance the CapEx will contemplate AI to in to years, XXXX.We to investments resulting $XX also expect program, modernization XXXX. which and million and the one-time to ERP XXXX expense leverage spend execution for This and expect of XXXX.The of target taper related The to over the these the our and investments. heighten data be a related to over spending expenses. course $XXX XXXX the these diminishes. comparisons are and project total will year our doubt, significant next forward in we split we not estimated the as to CapEx ERP $XX capital account.We expenditures is enhanced to million, to the in OpEx million, likely Despite levels and in to GenPact This to which initiatives capital retail sampling result, XXXX only million our in be exciting project-related outlays, with the capital of new investment this we three aforementioned majority XX-XX XXXX. to implications, business, EPS.For $XX we net year the expect to and be will including EBITDA total in progress return historical $XX and operating to outlays, for between does compared long-term critical occur as and in last the be significant net expenses, but IT make unfavorable of

and As time.I'll back on services a for Thank next new reminder, to branded, we Dave. earnings. your plan now experiential, it three to retailer our over results quarterly segments, report with our financial you turn

David Peacock

Thanks, what Chris. growing tremendous company the of people work it have done to The is today. Advantage

work We Our we the take realize while Advantage communities. personal will remain job for and your need we are serving goals, we choice But questions. and retailers lives Operator? efforts becoming now their professional unsatisfied. to and It's a daily teammates them wake strengths creates proud and steps enriching better their momentum enable to be. and to energy help they our future on up That tension endeavor realize Solutions.We to our to critical of we the always successes. in brands employer represent focusing the celebrate healthy our where

Operator

Thank you.

Instructions] be question-and-answer We Thank will [Operator you. conducting session. now a

first from Parrish of the Please question. Stanley. proceed Our question comes your Morgan with line with Greg

Gregory Parrish

the guidance helpful. my slide. more thanks to the were slide Hey, just a good review, taking And as divestiture or questions. as morning. I I Those detail, for for well start specifically. wanted enhanced Thanks strategic the review portfolio guess, on with

done were a that. a in You've don't time, the minimize these at lot of I to But amount non-core assets, short clearly and outside. mean least from the

guess is largely from correct do premise you here, maybe the think I So it's and complete here, optimization portfolio small at only not is that diversification all?

David Peacock

through Greg, are. portfolio. -- divestitures forward. you want the correct. this have Dave not underway. probably Peacock. we that opportunities business areas capabilities We're probably would But is Thanks that's I And any And processes don't is on smaller are say core our I only know I continuing see we going that for obviously go activities not comment what as We in refine to question. to true is it say would a

Christopher Growe

know clear the to to would divestures management. are core I sort that proceeds would be not I'd Chris any a think focused add I as from businesses on affect refining go certainly want portfolio. distraction paydown. of we're that it's a Greg, you add things then of to be come but being can used prudent for that such we comment a just Growe And here. just through lot -- the want I just debt And

to point. reiterate So that just

Gregory Parrish

Yes.

color. That's helpful great. Okay,

point ask the to guess systems I wanted thank here about clarity. So of you. one investments I

all guess So $XXX the the inclusive. is million that's $XXX XX, I this million slide to

I how you this of It's So that's where payback the part just a on huge see efficiency a well. investment I expense big you kind Clarify base second you it, about obviously. have And the mean, thinking payback of of inclusive as are ERP and right? guess then that? side on

bringing revenue or to down opportunities. do need you of see it's maybe So the that some

put I the here value and creating think unlocking data new you analytics of opportunities. and on slide

kind Thanks on need do this? come to of does payback through see that So you

David Peacock

Yeah some yes, to Greg. degree

I You on. couple a of know, things think got you've going

processes, streamline to screening, today And now, for payroll there's the get customers and retention lot and candidate quicker employees, accelerate -- and decision haul then like using a the I it really the going relates so we of And improve That which then system both well First think.And centers routing flow daily with it information then efficiency ERP can comes of advanced is personnel that cloud. and And photos like of in do data when so the equipment of is validation work things groups right contract policies, more groups. on in the goes we're management. units to using our within making on AI. on lot comes as way a we to AI well. to a quicker just avoidance on already do for more in migration than costly from in and help decision patterns speed doing out areas of significantly voice the which modernization we a then the financial -- for at relates improve our business are know when better that but our finance you attraction we're a our and determine look looking business data inquiries you're expenditures the we and can the this the enabling some higher that's buzzword just our the at more cloud in as and get it better as our I -- we

Christopher Growe

the in to maybe bit XX% over just and add put spend color of just of more side the We year. financial on spending. this - release the the some be a Greg script at there I can the little of what it the is sub going level

in levels. again and XXXX taper to essentially historical back XXXX will it by year and So

So there. us will that get

This support this bit year Is There next customers support reduction as from bit our a back little area said a really, programs? better key surge us DSO going and and previous come incremental are that to system. going will help business. next more cost there's year to That's this upgrading really, hopefully efficiencies this. an of right? a -- And this on I year of then But in year, should say the enabler, So really There's help be XXXX. growth of will to a Dave our little business. our also improvement. normal is this the is and then incrementally we'll where support kind the of, that's

I less see this be year level forward. will a that investment beyond will the little then of just going think that and spending higher you

Gregory Parrish

helpful. to the Super about I Thanks. wanted ask great. client Okay, just access. one guess then. I more for

I they I think competitors know more you Kind -- up ramping on is they've you play? are are exits, risk big them I are kind on two year. cost that still client the of call that but forward? from they as at in do competitive quarter competing their the on past. initiated and XXX% color sort this Would done last cost a Thanks. that end? of Do are a assume you competitiveness what some year you give is called Are -- going as those? of dynamics one out

Christopher Growe

have way calm are we just and decisions exit we've add just about say that Chris on relatively clients made its frankly. an talked it Growe internally competitive -- would will business. effect environment that and to a here. remains that would I Greg, I the These

an some and think to on revenue. that you meaningful number EBITDA a these X% less to of a might of say just you're it it as line kind in help of effect decisions of call explain effect going on the of top less there result some it's why you I'd exits. want client here out. made than So just see But I enough I think

Gregory Parrish

much. very Thank you helpful. That's guys Right.

David Peacock

Thanks Greg.

Operator

question the Canaccord Genuity. of question. with comes Please next Our your Vafi Joseph with proceed from line

Joseph Vafi

good the guys, presentation. in morning. Thanks the information all Hey, and for release

Some maybe maybe level. of sit start we just at a at remarks businesses. where and of back just you prepared high around your And the intersection Dave to these go some

opportunity see business Officer e-commerce you and in and to are and revenue bucket obviously, it a touches compare maybe Revenue how and you would revenue as Just contrast you well. terms kind of where just you're of wondering other pieces things largely new define today in you're Chief growth where that that bucket of And seeing. you bringing -- might of how

in I'll follow-up. tie then as may And question this a that well. So to have

David Peacock

Joe. appreciate, No

Some on couple of e-commerce things. a so

maybe not of of on revenue. kind a First, if less XX% little around than

I e-commerce of an or And investing what I'd have through lot some. think level. a an normal it's be this kind area area look in it at is IT our of investment you opportunity. where is we If kind either where we're of say would And

will. What data monetization. our then we've say e-commerce if other So sales industry. we rate said, is CapEx XX% total have a bit our got not up us, though growth bullish fourth interesting also still on a you keep and right for of is for very it's data monetization, just of small e-commerce as business.But words, back dipped the now. sort which about as which increases in overall to will share And e-commerce the ERP I that increases the with I'm grocery will returned And in has I'm some to overall pretty on talking quarter Chris help efforts demo both

minimis. pretty a say up to fix partners we've of retail put partners.And And we've comes to lever in with drive of -- fit as they and CPG got as growth share see the done as our is I far our growth. -- e-commerce done lot kind what a de So research as

space. on same I that lot At see to to our in critical the business. a fact have both industry opportunity hopefully to and we've We to think that brick-and-mortar there. of realistic frankly headroom the a time be we opportunity to of the got think an still in capture the industry we lot So and share

Joseph Vafi

employee a I then down Chris I strongly was maybe good bit. did for here wondering were specific you that to lot how employee I a think was there turnover outlook like I'm XXXX QX. employee you just that secondly down enough. just or wanted pretty there see And little drill know any That's mentioned to things color. changes turnover Thanks turnover in just guys. Fair down bring that. in

David Peacock

lot macro Joe. volume been They're turnover there's to work basis, improving. they're little lot Yes, labor loosening still a there broadly loosening that doing less hires historic of in bit. relative tight on critical kind are markets professional have and days. front say you a first are and base. growth edge most of a but would can like of things bit. talent quarters a the labor.But in the I a market high initiatives been the is spaces a lot imagine on tighter services little And XX around the giving at recent I businesses of more say on in most a is of Thanks, we're probably have the retail talent I'd of underway a we're job our we I kind of availability and speed last U.S., mean looking high-volume are mentioned lot which in the is a us more there's

If days, your on. likelihood someone is higher you much can XX retention keep of

So there have against that. of are we a initiatives number

ask the management the So, other about comes We high retention.And I the is to you to it see still a averages. on thing, bit. is think it leverage do better had up side. lot we're very to it and relative think inflation improving wage bullish talent didn't ability you on historic a Obviously, drive wage but I

we important opportunities wage kind which bring standpoint. But, retail really ROE from pretty And overall down in processes recruiting an is the dramatically, we efficiency turnover, is we costs our far there reduce business. obviously, of inflation can for on as broader are with what as our if do in-store. for line Our our

Joseph Vafi

Thanks Dave. lot, a Great.

David Peacock

you. Thank

Operator

Bank. proceed line the Our your question. with next from with Please question of Alwy Faiza comes Deutsche

Faiza Alwy

Yes, hi. good Thanks morning. and

start branded, you I previously going to quarter, So, I you heard next And retail mentioned you basis. think wanted experiential. that Chris, are that to three we're about talk I a and say you're that that getting, segment said going that on and pieces had the

you give and XXXX the can have curious is what if just those in So, individual XXXX? for expectation pieces us of overview an performed how

Christopher Growe

Yes.

Faiza, kind will the then we'll year new in out the as you the old within should to I a the segment share give of know going performance. that and into pieces the of way segment. deck I the you're it's we chunk move aligns first we'll that but until format would think that sales report that would it, say rough slide of frankly, on you that cut be have segment, each just going information breakdown of one quarter business kind going with segment.So, experiential the rounded as individual into giving performances. to that is information the pieces the I -- that largely I branded on way. then much each about the forward. on just in that I So, I have And we we I a segments think the newbie can services outlines some don't have those off numbers marketing revenue the segment services. with go think and say hold retailer by I'll with you in perspective XXXX

Faiza Alwy

Okay. -- you That's we those where fair. at around are a like where the data was just I are down you and like And X, level trends? sounds you tick thinking then there show more -- Are now? side we about, demonstration. a talk how on sampling normalized guess and It

David Peacock

of XX% over are where customers is or some key customers, a to event you three those will see which well the made turn you And progress key continuing of have recovery are will back if kind we we've our although customers lot if of businesses earlier. those with we're and We that great. some on

rate XXXX compare better experiential honest, against performed lot, I out a almost into our little we going area and a as on chose can we're high-volume very to as the kind customers That's We're not initiatives, around we're be business. and just and a about going back optimistic It been us years. we to look go which XXXX, forward, in get to we reengage this talent well very different XXXX. more bit? when talent, for sharing it's So, progress varied affects So, we quarter how of start at of were first in on reporting five is, optimistic through services of some execution I'll and lot mentioned, XXXX.A and the keep information. to that

and little others to point a So are to of data going we maybe performing. it segments, better to indication bit other we're those a a how have are have getting new businesses look where at gives

Christopher Growe

of allows in-store Faiza, these If this the color the employees. question It I work. a about Joe's retention, turnover, other can to obviously, back turnover add of the there. more go to less execute I more it's that us just and side more little of events,

got is I that as the think on think benefit I employees business. in But having we better good having exit direct Company versus to ended measure, the a payroll.We of we the the that the ways over more fourth progress events the there's base We XX% should we XX%, on there's So other sort XXXX that I did quarter. in we're would turnover, got make as range. by that year somewhere to measure less year to say in XX% XX%. just right XXXX, back that

there's that that experiential so we're large of So customer our year, to part remarks, be progress -- just we'll the the a talked our add new new customer we're that spending that in the a partner make year.And ramping want for will also for that -- year. I prepared capital this them, fact then, throughout we in about this throughout

So make sure want I that I note make just there.

some driver really there's progress growth good So and XXXX. in that be there will a continued

Faiza Alwy

Great.

to And getting exits, then you're areas finding not area a the back great they client or what us providing a retailer. of you're you're where bit you just time? more a service color particular Okay. are give Can particular type going or around the in services that

David Peacock

looking teams. those when hours but clients. syndicated is in those determined It's detail.And from and where that's of areas at done, on not they're and utilization tracking is say dedicated with are optimizing of And primarily pull syndicated on under that frankly conjunction and exits then obviously, teams a this to the as dedicated the our got the in them. in the routing we rug out we're model It's something where down they're client hybrid you've specific primarily. not where have both I'd what you're the to retail exclusively Faiza. it's we space, merchandising really a teams Thanks

come ultimately the focusing the that we're and decision and we're that care and clients move to ensure going conversations taking detailed have on to We retaining. of

Faiza Alwy

of for XXXX? one flow going these one-time you're given about guide. just last cash investment, I provided just then Chris. how charges some cash a we free you And around flow in haven't it. conversion incur Got know should technology And to curious think

Christopher Growe

Yeah.

So flow cash we offer did a year. guidance for this free

first So time we've it's that maybe surprise. the caught by I know that, done you so

Faiza Alwy

Yes.

Christopher Growe

okay. That's

to you So I'm happy color on that Faiza. give some

it to XX% flow. our unlevered to call XX% going be EBITDA So cash we're free of will

XXXX we also our this driven CapEx. by we XXXX.So a of working DSO flow want year I metric great capital incremental So And add to cash had working performance. we've EBITDA the being I progress lot to look in strong on were constant. the XXX% way of in reiterate, this that incorporate that free that all holds want on assumed unlevered that capital by of really for

on drive internally performance, on I unlevered to So to this some improving I change inclusive work going in of free capital see stronger very hard be you'll performance for lap yet and question, and flow. emphasis the as that. it's have of just think still grow XXXX.So this capital don't we cash made to to our a progress process good the year strong we're going flow to there's our even we're going we're and and focus just spending doing very again great and cash hopefully we're that CapEx I think lot and want working No but free EBITDA a some real unlevered commit to what DSO on

Faiza Alwy

Great. Thank you so much.

David Peacock

Thanks. worries. No Bye.

Operator

with comes BNP proceed your of Paribas. line question Please Tyler the next Pierce from question. Our with

Unknown Analyst

trade your they my your morning. continued any loan? to going see alluded taking to to notes target a to larger promising your Very good debt relative prioritize but Hey, you as forward term here, discount reason Thanks paydown, had at Thanks. guys. questions for leverage

Christopher Growe

I relation allowed us see the that as of did conditions assess made it to the that return and market trading some basically said that, our that the quarter, for way we'll So like and the loan. we to in term the do go year, notes answer through to you'll in we the lien levels as proper is kind repurchase fourth first

just would of we'll that So just at that. looking use cash. the throughout to that.I say that do year, we'll all I that would say And want reiterate assess we're I

the the ended debt pointed proceeds flow all million-plus the through of and the year towards reduction $XXX at have of debt use year We or be year. internal generation cash will those We'll through earmarked cash.

go those trading through So determine we'll have look those we opportunities as at make that choices we'll and to to level that.

Unknown Analyst

how thank context in of should as balance go the of one kind of Great just your And forward? we there, answer you. more cash a think we minimum

Christopher Growe

in that little realistic in us. today think are we're range the level below of for cash is I Yeah, that probably a

million-plus range $XXX can see well. flow us ABL below that for think don't of into about I have necessarily is cash probably way think So to an We we best needs. could that. we the as course tap I dipping that, always

again not got and maturities of here today in just the we've real here reiterate short-term. a flexibility it again, no to So lot but

the bit a little more that. got on we've to ability be aggressive So

I $XXX range to a about good think think is So it. level the million

Unknown Analyst

and It's cool. Thank you quarter. guys, great

Christopher Growe

you. Thank

Operator

closing this for questions no comments. are There further Dave you. floor I to Peacock over to the back Thank like at turn would time.

David Peacock

Advantage. We there Thank unlock you, value so is at believe much here to operator.

So our led of a by a advantage great team committed which for is company. people, competitive

value more we're talented win the team focusing analytical time thank for services, further forward We structure and the quarter enhancing this for deep in again swift you plans organization call mates, significant first your our enable have business evolve speaking and to stakeholders.Together right essential our grow a financial and to look to create progress May. to relationships, with right on today, and upside discipline rigor.So implementing simplifying in making and to strengthening our on capabilities grow, our our processes, and

Operator

teleconference. concludes today's This

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

Advantage Solutions (ADV) 29 Feb 242023 Q4 Earnings call transcript