KELYA - Earnings call transcript Q1 2024

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Operator

Good morning, and welcome to Kelly Services First Quarter Earnings Conference Call. [Operator Instructions] Today's call is being recorded at the request of Kelly Services. If anyone has any objections, you may disconnect at this time. A webcast presentation is also available on Kelly's website for this morning's call.

to meeting like host, to now Mr. would turn over the your I and Quigley, CEO. Peter President ahead. go Please

Peter W. Quigley

Thank you, everyone, call. Greg. Hello, quarter Kelly's conference first and welcome to

we safe through Before walk language. our I'll begin, harbor you

comments a forward-looking include our made As about any during call, Q&A, statements performance. including future for this expectations may the reminder,

SEC no description call. differ the statements update the materially could by Please results that the to to those suggested could a our company's performance. on obligation this filings comments, risk factors Actual actual from and of refer our we for have influence made future

In data basis. insight trends in a Discussion on the measures, basis addition, adjusted on into reported certain items financial during give adjusted an call, will be to operations. of an our are certain and on non-GAAP discussed designed

Finally, information with is on our in Kelly's results available financial a presentation website. the quarter about

have We so get started. to today, a lot let's cover

turn announcement to quarter to journey. results, Before transformational first our growth like on a forward regarding I'd Kelly's specialty we recent our address step

million paid Kelly a additional to Kelly a Under cash potential definitive Partners, acquire Recruitment solutions Motion talent million for specialty $XX be with on of leading terms into week, MRP $XXX acquire criteria. based of to the the entered will at agreement agreement, performance close, to Last up in earnout company. certain

strengthen significantly RPO across capabilities and and scale MRP of staffing the North of and telecommunications technology, solutions both government and globally. already-substantial acquisition consulting will specialties The solutions America Kelly's in

significantly of market with a key capabilities, expanding its MRP share deliver areas. through brands across operating of increasing enhancing solutions existing several companies Kelly's transaction, close and of the and will the MRP's breadth Following goal services

provider delivery business tech will staffing of as technology, talent top platform a and SET Recruitment's Motion in solutions U.S. the established business the and Kelly's expand consulting

globally. a client create MSP subcontracting telecom new Federal segment Motion strong to among platform the highly bring to both in will Kelly's elevate government industry-leading X bring SET's technology base partnerships a and to and And top to a client delivery Kelly TG market-leading add attractive will government complementary space. offering. Sevenstep RPO with KellyOCG's the to its portfolio in Telco brand telecom existing will RPO dedicated and build upon success specialty in capabilities

complementary highly of and the its OCG our forms businesses with continued portfolio partner basis customers value fuel and of growth. brands leading The invested for creation. MRP long-term resources substantial nature transaction, to SET this segments and a and Through will highly breadth the MRP's provide its and Kelly of

enhance XXXX. Kelly's expansion Likewise, upon January the margin Kelly's significant It of acquisition implemented actions staffing operations EBITDA we've in XXXX and build expansion. through EBITDA accelerate the MRP and of sale will delivered the in European revenue potential will growth margin

subject redeploying in second This team look deal sharing demonstrates I and the other closing conditions. regulatory expect in we and customary rapidly occur Kelly our responsibly which the more the of year, pursuit commitment to approvals forward inorganic higher-margin, of to to capital formally investments in to MRP quarter to closes, specialties. this welcoming transaction when details higher-growth and

EBITDA our what In Through industry, persistent margin results. of control we remained tandem on transformative acquisition, we pursuit and to uncertainty with continued journey headwinds drive impacting we focused expansion. and on focused macroeconomic our progress making this delivering our on can significant

quarter, the sale EBITDA EBITDA staffing with basis increase following an margin Kelly's margin of raising to the delivered of in and operations, first XXXX of began points X.X%. adjusted our adjusted an X% We XX European we

across a line businesses positioning to our of continued Kelly bottom we Our the growth. efficiency and convert working, progress to growth top growth actions demonstrates share implementing greater that line are are

Financial Chief I'll on turn in to results Officer, Olivier our details quarter, first the call more Thirot. For our the over

Olivier Thirot

Thank and good everybody. you, Peter, morning,

reminder, visibility the on greater changes our sold to excludes To of trends January results a also basis. XXXX. on of operating provide in X XXXX business reported European As information and organic XXXX. we in year-over-year also the and into on discuss that References an our include business the results, organic staffing staffing Kelly's results I will Europe

a the staffing of for revenue staffing primarily headwinds. XXXX, our $X.XX Revenue organic market basis, XX.X%, On quarter, the $X.XX quarter down first European declined billion in XXXX compared the resulting business. to totaled billion an in continuation of reflecting of from X.X% sale

headwinds, continues be from customers. SET both strong, down demand new low wins reflects revenue segment's continued existing segment, fill up growth customer rate year-over-year. our and the was Nonwithstanding X%. to growth net double-digit from Education XX% revenue The In

challenging quarter, X%. down due by to lower RPO Year-over-year first certain demand in continuation of revenue continued slower Permanent declined declines down our segment, the X% with sectors. our fees X% market outcome-based continued impacted staffing to we saw declined specialties market business. year-over-year OCG the in conditions, In hiring be placement our revenue and in XX%. in During and

center our in Revenue revenues market Revenue year-over-year segment Deceleration in continued, And year-over-year staffing product our continued from Professional the specialty on revenues declined XX%, improved quarter. in also MSP conditions. declined XX% reflecting while the [ declined Industrial in & segment's a outcome-based challenging PPO quarter. the basis. ] revenue contact year-over-year

which X% XX%. Overall, is our basis. improved. reported in or also on Mexico, And organic in profit in ] as fees gross now XX% Revenue Overall [ improved perm was P&I, P&I included other in an revenue outcome-based specialty. declined

compared profit gross the year. XX% prior quarter was Our rate to of the in XX.X% first

of our operations. from Our staffing GP rate reflects the basis improvement a European XX sale point

So points perm due XXX XX due points points business unfavorable basis basis in rate to on fees. ] to [ mix basis basis, XX lower and declined an QX, GP organic

rates, rates Education, in respectively. The with due business and specialties customer SET mix to product GP in reflects impact growth lower GP and lower and OCG including mix,

to [ including quarter transaction transition ongoing were efforts transformation of as XXXX $X.X expenses basis. first to basis include and the million of operations, sale staffing on organic the related XX% an for and XX% of our of down SG&A also well $X.X as year-over-year reported expenses related charges ] million European our expenses. a on Expenses restructuring

SG&A million $X.X of restructuring expenses in charges. include XXXX

expense on the basis Like-for-like impact declined incentive performance and expenses, the by XX% QX to efforts adjusted in line an reflecting on top XXXX adjusted an due as were basis. our trends. structural expenses organic lower or of So positive well XX% lower as transformation compensation challenging

of the segments, first we reminder, measures. now reportable reporting operating our As revised quarter, the business utilizing results unit a profit beginning in are

as greater units. our to We a share are corporate of cost allocating costs we business reported have previously the

in are measure. greater contribute profit each longer to we addition, and our and overall We performance. they how this the provides unit believe no In including Kelly's business performance visibility of financial amortization unit to deposition business

reported our in $XX.X compared operations quarter to On earnings from million a the million in $XX.X were consolidated first XXXX. QX basis, of

on $XX.X operations. sale gain European Our QX include our XXXX of the results staffing million

XXXX and sale our million million of I of staffing transition related include our and charges European noted, As also $X.X related to operations restructuring results $X.X activities. the of expenses

quarter of XXXX included the million first Our $X.X restructuring charge.

operations XX staffing basis, improvement points the prior over transformation from So improvement adjusted the on improvement to and from our also adjusted efforts. European from ] XXX an margin of And sale XXXX points about X.X%, XX% basis of $XX.X million, a [ year. reflecting our ongoing were points operations improved EBITDA basis XX QX of earnings basis

first $X.X the in compared for expense tax XXXX. million was quarter $X to million Income

effective XXXX, was the Our with rate consistent prior XX.X% income tax in QX year.

the from related earnings for include to in restructuring share the reported [ first tax. related finally, of $X.XX offset European was ] and transaction-related XXXX with of quarter net per And settlement XXXX. $X.XX compared gain sale forward staffing our in gain partially by the share all the contract, $X.XX Earnings operations, charges, charges of per on

XXXX restructuring of charges included of share $X.XX in per net tax. share per Earnings

QX So year-over-year. was $X.XX on QX $X.XX per XXXX, XX% in compared basis, XXXX to of increase a an share adjusted EPS

At operations payable sheet. had Now and staffing cash reflecting European was $XXX This at proceeds that [ debt sale cash the ] totaled million, closing. no of on we quarter our the end, the includes outstanding. from balance

related At totaled in and billion Global final X of for under We do days, and end, year both expect net not to receivable and of additional proceeds. DSO quarter of quarter expect but capital XX debt down $X.X quarter cash first working cash XXXX earn-out and day proceeds the the terms the adjustment, was third XXXX accounts any transaction the XXXX.

the $XX the in we $XX -- activities quarter, $XX In prior used million in million and million using for operating we comparable to period. for quarter, used expenditures compared the capital

be forward, Recruitment acquisition funded by facilities. of the Looking Partners existing borrowing hand will credit cash on on and QX expected the closing Motion

flexibility and advance commitment as to of to reflects and liquidity. to To ability credit maintain inorganic we our are partners organic balance currently with to maintain manage our ability responsibly uncertain additional facilities banking rapidly inorganic move our capital environment. the financial our sheet and market strength Our our strategy redeploy working amend in to navigate we to our initiatives an our forward, invest to

to second consistent ahead quarters. for market operating have remain believe what Looking that results relatively staffing past with several we will over quarter, experienced conditions the the we

of an up significant quarter $X.XX in with X% expectation expect be on second no a to XXXX, the billion. revenue to For of we basis, organic midpoint X% FX revenue resulting impact,

QX comparable. reflects revenue QX outlook with benefit lower the be of consistent XXXX expectation that trends an Our will with of

and of And await for acquisition other closing do our completion we any conditions. of as from Motion customary yet include impact expectations not Partners clarity, our approval Recruitment regulatory the

mix, expect our GP rate midpoint deliver to On be change to decline business a basis this the range, is reflecting between at we For XX.X%. our the expected business point is to the our quarter, revenue like-for-like our XX a second Education continue XX.X% basis, significant to in growth. because primarily of

in improvement adjusted organic to to XX impact XXX sustained of transformation-related QX XXXX. basis. or expenses a improvements EBITDA to an points actions basis, the last year our expect an of like-for-like basis to QX we points similar On Overall, continue basis we continue. we adjusted expect versus expect margin as about deliver X.X%, Also, of be on of SG&A efficiency

advantage And market improved recovers, take we the be our believe to that positioned further of well we'll when efficiency. staffing

effective in mid- to tax rate our be expect high the teens. We to

back to now Peter. And you,

Peter W. Quigley

we last insights, would initiated am we transformation this benefit implement business would structural, stakeholders. that Through those for achieved delivering year, that improvements commitments. pleased committed sustainable date, say all to Thanks our have we I we're I our to Olivier. on the to When progress our

the average a increasing X%, the profitability, in approximately time. the We have, a company's recent and net Kelly's quarter. improvement we EBITDA said and we in significantly first we X.X% to our short step-change margin delivered from This very would of is improve margin

term. long business we We leadership in in to capital said and to attractive over valuable move which redeploys company's would positioned value-creating opportunities, that seasoned we highly assets a deal a invest bold and largest the well history grow Kelly have, financial the signing and the with unlock new in profile, is

would and environment Kelly said increased growth, new enterprise demand both model in continued localized the when capture deliver macroeconomic to our We to find rebounds. avenues and have, we results, delivery strategy of P&I encouraging as large we positioning account early

It's start on executed grateful on everything our noble been we do growth agility the and an exceptionally as keeping team to Kelly this to guide. clients and us so deliver productive their worked we on have the to journey. point urgency talent with to these with the done our while priorities. who as I'm our specialty of our at purpose strategy year to bring They've center

the received number commitment reflected staffing have XXXX in we honor List this companies, consecutive America's an week ongoing to one being Kelly proud temporary Their of are top for Forbes year. to named excellence second on is

While be our we new Kelly as these will into confident foundation there's a establish era a inflection I'm which solid and an upon work XXXX on form journey to growth. propel point accomplishments of more done,

call the questions. to open now can you Greg,

Operator

question from [Operator first the NOBLE comes of Instructions] from Gomes Your Capital. Joe line

Joseph Gomes

questions of overall acquisition kind I'm Kelly's us adjusted we it first, existing So give revenue Obviously, indication up what with hit should going more can on be than get. contribution, you of higher and since increase see EBITDA Can margins? to margins. you detail Kelly's the should they say any you

Or the on staying here? have in acquisition of of has management concentration, -- the top be been business you business? management appreciated. leaving growth of more some greatly will see do detail with rates planning customer recently seeing Any this on Kind the types

Olivier Thirot

Yes.

question. think your I -- you Joe, thank for

that know are to deal. the close you course, Of still we

$XXX there we provide think in I so say to would I not this going numbers, of What so million. at course of in pure revenue it's terms QX, in of much the can stage. is excess be is

So and key terms think on that's, impact or future impact a of I of -- value Kelly course, in information profile. growth

profile, this Peter was growth clearly As margin will net net value margin. enhance the profile saying, including and of the acquisition

to position comment various more more you and capabilities a can little information probably, new a in areas. complementarity on size give be And will course of this when the acquisitions, bit We in we Peter, close QX. in

Peter W. Quigley

Motion Yes. bring capabilities think very technology, business complementary Thanks, compatible culture. I across really telecom Olivier. and set, financial Recruitment business team, to spaces, strong the and very Partners. The customers like and -- the Kelly very and of to set Joe, MSP processes profile overlap, we government, leadership little RPO they excellent that customer Kelly's a

close excited. that We're will to operate value-creation very we brands. And successful to as management current with businesses work the work going see. we're continue, to on their under operating I said, diligently and their the opportunities So after very we team entities plentiful

Joseph Gomes

from additional thought staffing heard Great. might you Olivier, if did say sale I of -- earnout European the I any missed expect but this, I you business. not just see the to have

Olivier Thirot

correct. That's

business, are where metrics the you certain -- in [ know the have going we we because achieved basically not to no, staffing to If are they financial XXXX. have to ]. now confirmation EMEA condition that our any earnout you be And be referring

Although we QX. early still to stated, transaction we finalize now, the I wait in have until as

expect flow for free $XX cash and That's basically adjustment, of the $XX is what on capital we know come that what moment, debt, cash based moment. would to million at the and working some QX. region estimate at Looking measurable, net the early our base million, in we

of But that It around little additional we the capital about know we million again, bit should net broadly, cash about working QX. it should be -- may change when $XX early receive, a adjustment. more especially

Joseph Gomes

fill us And give Peter, environment, little roles that you're the additional to a I whatever supply of on on talent to just to color ability and maybe wanted get kind trying especially to fill. people

Peter W. Quigley

of Yes. from think in changed not of macro talent. Joe, availability the I past terms of the environment couple significantly quarters has

the a rate, look at quarters. some been the what rates, you labor key quit past participation to factors, they've force all If in flat take they're labor other pretty few

anticipate don't see going we we're in to QX significant that So change. any

I'm where in ways team price. will I cycle take it's of Kelly fill times the the the rates with improve to continue market pleased and of compromising to available find demand to share and face say our shorten ability sluggish without

Joseph Gomes

Okay. Great. one one in I'll last And me, queue. get back for

just was a One want some to about that on things just their update. And doing to I had different to other occurred progress that of is give and know the struggles of of And some maybe give -- RocketPower. us trying talked lot acquisitions maybe I try going on, little I you some get improve operations. us update of how progressing. all a

Peter W. Quigley

Yes. I the faced they've improvements RocketPower's operations say, in see, some because business. to in structural shoots foundational in they're space. some many particularly pleased, Joe, would Like with and we're RPO book the RocketPower We're -- beginning would very headwinds. technology to RPO, green the, of space, in But I at refer

think, the capitalize RocketPower, about on position -- have as the rebound of and space. that the we And now, in And -- we that KellyOCG, well optimistic we're taken we RPO them for any the time the forward, we've potential them between acquired part step going practice. larger to

Olivier Thirot

just revenue add would QX When RocketPower look at one I versus improvement of so of an XX%. sequentially, point. you we about data have QX, seen in

good we Peter So pipeline, some see as traction, was mentioning. start better to

Joseph Gomes

Really queue. see looking the for awesome in acquisition Great. how unfolds here. MRP forward It's business. back get news that I'll also to

Peter W. Quigley

Joe. you, Thank

Operator

comes Research. Your from Steinke next from question Kevin Barrington of the line

Kevin Steinke

maybe more don't So you acquisition, you'd of be revenue And various business the government, on RPO, much able give various one was this know scale give telecom, to between did a how just us in if the size. just Motion your kind MSP, following added to of of areas, technology, be up Partners will of the pieces give sense detail there those Recruitment the terms the breakdown I piece transaction? from

Olivier Thirot

Yes.

think we a percentage. you to are going give I high-level

and say the revenue. IT, So if of MSP is RPO, I XX% Federal the would you telco think about IT, about one and business, federal and telco side, Sevenstep, business on

weighted our So SET into it's business. heavily

but brand is the on. name and business, the coverage, the SET in not again, large and basically Although, very industry verticals consulting with terms And this only staffing or IT basically whether IT, Sevenstep, interesting think RPO well-known of within business also it's I equivalent. so is add majority of

Peter W. Quigley

technology I'd particularly Kelly a Yes. the technology the IT the addition add existing substantial And Softworld Kevin, from including in when space, and standpoint, practice, added of qualitative legacy a to business. repositions Kelly, our business technology

-- higher-margin, our remix really that's continuing is potentially least part in we towards the of business what repositioned that to think the fastest-growing substantially higher-growth historically. to the important industry the -- and And We're businesses. at

telecom and to to complementary highly Kelly's as Similarly, the MRP's in are businesses overlapping. businesses, government opposed

in some something that which while Kelly contractor, prime a we're excellent is participates in. has relationships government, currently So very MRP subcontractor, as a not as strong

And overlap of customers stronger telecom technology -- particularly of the little telecom. in engineering telecom to -- be whereas capabilities space but very in in that tends the Kelly the MRP space, is from in in terms excellent addition

portfolio businesses scale, to So very the going really significant we nice adjacencies of some in addition they're capabilities to within MRP our to think bring that portfolio.

Kevin Steinke

was That insight. helpful Okay. very

materially so. you in areas any trend than fourth you Just But lot didn't trend the the perm change quarter, in revenue I of a maybe a more macro quarter. the saw decline you of organic mentioned It point other in bit in was or the placement any of guess environment. you change might not terms terms a in the whole see in first of to? meaningful

Peter W. Quigley

operation seen performance. placements. any don't -- which where myself And pipeline, We -- Kevin, been. again, customers, repeat among Perm change it's in wins, haven't perm very been improved significant the placement on no change has in continued bullish I results new growth, from that continues. we're Education existing is growth

businesses there technology recover point. in some would mentioned, a in technology some signs Olivier months. Softworld next And as few business. but It's Kelly we And shoots going those the foresee RocketPower, any legacy don't that green -- some seeing similar -- space. at our seen in and regarding is still QX, we're say have We I but change early, significant to are Olivier mentioned as in

Kevin Steinke

Okay. or one as the Recruitment give with back curious a it want with together, if other of business that how if it's built I Just Motion relationship came up possible you so Partners. for it's was circle just sale a question. have time? us deal sense over kind I to Maybe about that to if on to a was aspect. just when

Peter W. Quigley

We X the MRP of were the I Yes. of future. upside ago developed up our saw all complementary the as side relationship to in significant that. towards nature well partnering but with reinforce businesses course of a And a the on over think the attracted strongly of period and And time. in by couple Kelly. as weeks to within of signing potential nothing did these both growth to We discussions

and we're result. with pleased process the So the very

Kevin Steinke

Okay.

Just which combine a before. would you traction? more one some gaining the Is growth attribute in said organic projection couple -- second and consistent transformation-related for question. quarter, that of your here, initiatives But you what with into I'll that's your try growth that to

outlook just had give if insight what you secondly, change the gross margin just then the any relative And on in discussed? previously you to can

Peter W. Quigley

Yes.

strategy enterprise on encouraged well on we've that introduced organic space, of by my script, the I to account my large the Professional we've growth, & first notes I the or taken part our the in revenue, steps as as in question particularly omnichannel about we strategy. in are, the focus segment think, Industrial as said Kevin,

macroeconomic in And encouraged very quarter continue industry we're the logos. existing by when well as a I'll expansion two it, margin as turn improves, new acquisition over basically on to Olivier well but We're think success wins, customer for to environment areas. see into those we that it positioned gross our to the the new of question. both

Olivier Thirot

Yes.

balanced. until in the business, anticipate to would Just mix, our mix as said big very growth for something line of continue -- top main is more on say, that QX, the and is margin, I we the QX, that similar the gross as going we something Education rest versus see we

especially all can -- or big it's and in in flat, moving P&I, our SETs,to I was at not see is a some and in is you I What you price. whether don't we sign extent when which declining, sacrifice look pricing spread at spreads, at up, tell in that Education in but pressure, is SET, don't now look basically P&I, our we

is that -- this growth. dynamic top and linked we But suffer evolve a balanced bit a mix about little as continue will we our that top still more soon still get to we line as should to factor line

QX, the the of why of we our business end starting believe me rate XX.X% ask Education of help that BPO one to far gross going summer bit. Education We you seasonality, mid-range type [ and in to us margin to we meaning ] good from If slow of event. of QX, of traction year school in little in is would because a QX usually, move see down are is a in that XX.X% terms at points P&I

And Peter the mentioning, favorable of SET profile more start see that a mix average. we also, margin we the better to was in technology got because than in a usually traction anticipate as

So to year pressure. going mentioned, basis at something points versus ago. there is But are going to I main as continue to an And mix to driver to we should a us a on that XX.X%. be around XX.X%, factors the help versus XX basis XX.X% are few be go organic still

Operator

Kartik question comes Northcoast from Mehta Research. from next of line the Your

Kartik Mehta

you quarter. any trends at very the in in Peter, you saw the first trends? from I'm just what similar to trends understand change you look gave, the curious on April, to first quarter, saw were But assuming you I'm the in throughout if commentary if April in

Peter W. Quigley

would didn't throughout see outlook to cause was sequential change talk little I a month-to-month anything pretty monthly for the April, anything would was QX. consistent us a that too our would but relatively or seen we the early full it Probably at to I about -- month quarter. the that we haven't look of it say when changes, really. say the Not performance,

Olivier Thirot

March with QX rate, our I you at total When look agree. basically we are on our trend. exit par

we there significant any So conditions. seen something in not is market would have us to lead far, say changes the changing that

Kartik Mehta

kind And you a customers, market in people -- think you just they just changing? Peter, conversations the as are standpoint, flat we is what not industry similar inclinations bottom? either? this what and the you they any getting starting of things Or your with talk and improve, your have they're come not that this it's is and to other or customers, the maybe it seeing area again, from are they're any are Do changes are kind of where to kind are where of is accepting market

Peter W. Quigley

Yes.

their I discouraged they're pushed say, the December of chain, and customers they're their their time looking -- optimize we not it not are optimize maybe business for forward, growth, what the supply expecting gloom. from, last happen, to It's structure. from for little year. out still period customers of a going is But prospects expense bit talent that to think probably doom and by hear ways optimistic

that And all they supply support need term, services. talent can efforts of of their the to we're well to to the optimize how and in bodes that, their talent deliver for middle figure their out products strategies because and Kelly that right and long

little on bit and downturn. So possible significant I change, optimistic would maybe future less a pessimistic say, positive the about a more or still no

Kartik Mehta

And then just question, one last Peter.

acquisition this still opportunities more pretty you large pursue? no or there are a until I'm now digest MRP. As that And mean looking? acquisition that And you've Or wondering, look made like acquisitions? you that are does for in you to transform you'd Kelly, to

Peter W. Quigley

near to continuing look that high-quality Well, I of got that businesses. could and portfolio acquisition complement we're potentially Kelly assets to But mean develop in going to relationships doesn't we've think large stop a the for term. the manage

work the making We bidding understand let hard that of not of significant Motion lead It the relationship, the put of that on will Partners the high-quality that its a cycle time developing lives takes very process also sure a to of do finding to a takes avoiding we acquisition and into lot that upside. Recruitment time. time that, regardless properties, -- actually, work up will we amount of up

Operator

Marc from comes line Riddick of the question Sidoti. next Your from

Marc Riddick

wanted that looking on follow last up sort at forward, there going of you're general question some the of like? levels, leverage your flexibility of looking balance as sort size should transaction we're maybe we the I comfort to of given as sheet, and think I a was far degree. about to curious the at, as way sort is how financial to the

Olivier Thirot

Okay.

we as about million $XXX cash additional financing So have we of speak, $XXX and million capabilities. of

liquidity. billion $X.X So

If a quarters, X.X, X.X you then to projections, going acquisition, probably debt-to-EBITDA to post look at we rapidly we have below are go X.X. for few the below but going X and

cash rest go have we that is into transaction some journey, balance DSO borrowing, good with think that still of to great believe which pretty I -- in have news, and funding have sheet-wise, cash management on is days, you that the the balance a in capital, think strong I deleverage now ] them not mean relationship this to it and we in we think, fruition. But we the acquisitions may we and still sheet, comfortable to fact cash are flow XX come when I I our [ still generation, working We to have get think inorganic I only if planned opportunities some fact. partly the after we as but back opportunities to quickly, starting of continue at knowing lag now our time have between

Marc Riddick

private what to sort a sort of that, general overall looking as of And transaction, or then this tangent the are Maybe that out helpful. of you what you're outside from already levels the any now? we're competition very can of transaction of us That's update valuations, you've on an beyond as your as seeing Okay. at thoughts plate the as far as availability pipeline as of views far there targets? and sort just maybe to -- what as attractive sort maybe give equity to there got maybe

Peter W. Quigley

I the Yes. significantly. landscape say has changed Thanks, wouldn't Marc.

still There's discussions thaw least I that would around prior reached call to have the entertain properties XX months. carrying But there always maybe more would haven't XX possible at are, say market fewer is you. quality. are and more beginning a We discussions There's that those I companies the in what what exits, on or the not to combinations happening.

companies Private level at or space ago, some now significant that it's that the environment industry upturn going is just last like likely we is to current years there show to beginning to at of the going is X assets interest is recognize is, to high-quality a our but fairly was to be some think I portfolio a their not adding did. great duration I equity recognize because consider forever, whatever And not think time it and in still this people point. X

Operator

[Operator at time, further questions. are Instructions] no there this And

Peter W. Quigley

Greg, you can help, much we call. your thank the and end very Okay. for

Olivier Thirot

Thank you.

Operator

gentlemen, that Teleconference. your for you and today. your for does Ladies conference AT&T Thank and using conclude participation for

disconnect. now may You

Kelly Services (KELYA) 9 May 242024 Q1 Earnings call transcript