GPX - Earnings call transcript Q4 2017

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Operator

Good morning. My name is Chris and I will be your conference operator today for the GP Strategies Fourth Quarter 2017 Earnings Conference Call. All lines will be placed on mute, preventing any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] As a reminder, this call is being recorded. you. Thank like Investor call Relations. now Blank, to turn of Director to would over the Ann I Please ahead. go

Ann M. Blank

Thank you. Good Fourth Quarter morning and welcome Earnings to Call. XXXX GP Strategies

Stedham, Greenberg, On Officer. Executive are call Mike Scott the Officer; Chief today Adam President; Financial and Dugan, Chief

to begin, expectations. like could to cause statements will forward-looking that comments remind that I would we and are uncertainties subject you be our which include from to Before materially results different today's actual certain risks

we risks, are encourage to a the turn Investors time, complete call these For be on with to gpstrategies.com. which over of documents call will our SEC, section at available this file I'd this our posted you like on replay Web-site discussion Scott. read the of Web-site to A also At of later the our on today.

Scott N. Greenberg

from our foreign quarter current of impact was million in the then of Good including increased a will XXXX quarter results gas which oil of quarter acquisition XXXX. termination results opened, present by usual market quarter I'll call, million to Ann. four of will President, Adam, of expectations. in provide brief the revenue our Adam's our on you, follow conference earnings Then, Revenue Strategies format. the segments. overview operating announced XXXX. the This increase growth call. morning I'll corresponding To these negative GP and fourth to our $XXX.X large We quarter we of from and initiate XXXX. the revenue the the give fourth $X.X financial before initiatives. will impacted a quarterly despite $XXX.X the and product key million revenue welcome approximately financial fourth Mike, Q&A Thank updates a session. summary, provide to a analysis. This CFO, an our quarter from the And presentation, XXXX of in with in-depth update. global Today our fourth due we'll then conclude After achieved an three morning in the for

are months. in we represented revenue XX this value. substantial While of less for We record trailing with and disappointed project, believe this while growth our from initiatives achieved shareholder client total concurrently the increased undertaking will revenue than in the we XXXX, revenue that result some long-term X% this

We master our for are services extended with report service pleased that July largest to customer has year our agreement financial XXXX. been to one

believe for currently negotiating We the We the terms big is the agreement. with are Company. news a this customer multiyear of

proud delivered received and We value the have financial are of we and institution. major have this trust confidence the from we

and in in write-off costs, and While demonstrate flow results operations we in the a clearly a XXXX, restructuring cash industry the had large ERP adjusted oil from investment generated system, potential. our unusual gas and new contract

XXXX. These the was of and of full $XX.X In adjusted the our results $XX.X forward plan and contract, loss and $X.X approximately approximately million, announced fourth organizational of the our on stock non-cash of change million complicated implementation, management terminated was and addition, December million quarter team its million announced $X.X oil the in the for for Company's adjusted $XX.X to with cost The $X.X offset gain by of reduction XXXX. new continues Company which system value EBITDA a gas year look renewed emphasis $XX.X of expense, our $X.X to we in charges, in the ERP consideration The was $X.X investments million, of compensation million. included finalize million recently future. fair compared restructuring the on to million of of XXXX acquisitions and changes, were million and XXXX for add-back

priorities key cost-cutting we'll few measures Company the of to invest last and to excess When Company in the anticipates costs. the various investments net undertaken has savings annual see be of enable operating these an annual XXXX. of months, $X reduce After million in basis reductions savings Over these in to on XXXX. million completed, transitioning to the could $X on second predominantly impact approach some an costs, and half basis in of the

segments part As Company will combine the change, this of two. four into

to As the far continued open process, GP the buying in XX.X has buyback activity shares. fully $X.X million Adam by of approximately million. that purchased announced demonstrates approximately intention after and years I however Company a for long-term months appointed Company trailing for Company back the as Company million approximately in the XXXX XX.X XXX,XXX In the buyback the already the and outstanding quarter, XX buyback, repurchased the quarter retire support approximately now first goals clearly Emeritus. share the an that approximately is kept its of and in shares be previously diluted basis shares the The and XXXX XXXX. the President, fourth fairly succeeding of stock for have noted believe the in and shares market. million $X.X the has President consistent XXX,XXX his should on Doug extensive with Sharp, Strategies who It as Stedham Company

including drive has Adam transitioned Dugan Additionally, The on focus ability growth operations. is for in promotion GP of has his the organization role. many years. succeeding Dugan financial performer growth. led international demonstrated various Adam has a and organic appointed our to Mike Strategies, well the deserved. Esposito-Mayer Chief performance roles been her Financial His has high has in and Mike reflects Sharon Officer, appointment who been

and in to GP leading company contributions and successful and a new these their Strategies very making training in appointments, the global performance improvement Sharon arena. I'm like While excited Doug I'd thank all for about

right with XXXX establish that Russ promote leadership centralized expertise sector named the development align responsible Company business Becker service Company's diverse will capability a as and addition, a knowledge plans their and to GP in Russ achieve over experience strategy leadership January will with offerings. review. more call its for establish world-class of Officer. to discipline growth, Sales structure business sales enable Russ helping growth In of the the organizational experience financial be organization. Chief in-depth to development The Mike to wealth build joins us extensive goals. aggressive developing turn and team Strategies for I now including addition a the sales market to an our that organizations strategic Russell will brings

Michael R. Dugan

due quarter. increase. increase was million, morning a or of fourth good and represented reported million. of are Scott, segment Solutions XXXX the the X% $X.X and completed or revenue QX the The acquisitions by the quarter X% of revenue revenue of was remaining growth Emantras or this fourth the which over are $XXX.X million in XXXX. $X.X Revenue in of XXXX $XXX,XXX Revenue that which of million, the million was by Thanks, quarter. fourth oil primarily and automotive $X $X.X million a $X.X XXXX. of Learning fourth net X% This everyone. $XXX,XXX million and fourth the YouTrain, decrease & fourth a contributed largely engineering quarter quarter offset in and $XX.X We segment, services. $X.X X% decrease in in acquisitions Technical services. publications, increase in due quarter revenue in content and The increase increased over X% $XXX.X million, Organic services, from outsourcing was overall million or development offset or a a a increase in increased gas fuels This of to and to $XXX,XXX revenue in Services Sandy's increase increase $X.X in $X.X primarily of over services was X.X%. decrease $XXX,XXX, due energy, training decrease increase of to million magazine by quarter a in the revenue revenue technical a net revenue. million alternative represented Professional training

publication a projecting $X.X quarter. publication XX% The The CLS, the to Performance quarter in that which recently are segment, in revenue $X.X million in revenue are the million million quarter. by Solutions Readiness Rogers $X.X quarter in the XXXX McKinney this the $X.X revenue are contributed of and XXXX first and XXXX, million which or compares revenue million increased of the completed quarter. We in total completed in first in acquisitions segment $X.X of of of of

segment contracts manufacturing terms, of costs In of addition, with $XXX,XXX a Under was the to services. in were take a increase, renewal also client. successfully Under large these the one technical on This shipping recently training there internally. recognized margin. their as new travel, elements with contract net primarily no revenue materials, like expenses client decided old certain the of the agreement, negotiated

down no impact increase Going forward or up Organic $X which or margin. in revenue million X% made X% X%. revenue of $XX.X Acquisitions $XX.X or was an million. up annually, Full-year of million $XXX.X was there $X.X $XXX.X XXXX on XXXX, the rate revenue growth. revenue be million, million million should growth over gross XXXX will run but revenue represents the be by

years. automotive of comprised client XXXX. XXXX. was down sector over prior is XX% revenue, which and from XX% our in used consistent or with financial base. sector continue revenue, total year, XXXX the top strong five XXXX have in of to XX% The our for XXXX We that and was our our XX% recurring revenue have XX of clients sector more largest derived services in existed Over and from clients insurance comprised The of XX%

XXXX to customer concentration revenue of to for revenue, incurred loss which of contract related which $X.XX revenue of oil concentration a accounts XXXX customer, increase million, XXXX. of This or to outstanding services a foreign single November million this a and client $X.X a have XX% from automotive We termination an per XX% debt reduction our a a in our financial was accounted bad with of client. operations to revenue, a contract profit of revenue. notification or and was from expense earned We outside Revenue United comprised pre-tax formal profit we which fourth received of the consistent a decreased XX% gross X.X%. related with quarter this $X.X loss States In and in Gross represented the with receivable of share. fourth from by $XXX,XXX quarter, XXXX. the comprised the $XXX,XXX gas

to reduction profit process a from gross The increase SG&A a quarter. No we materially plus to or in $X.XX comprised $X.X drivers additional single a and increased implementation training the net This SG&A to are segments. a resulting Aside to had an documentation. gross significant net create SG&A cost increase the change million $XXX,XXX in of EPS. system was QX, implementation across benefits $X.X incremental primary four to to by QX compared all gross million and from due segment to of ERP follows; profit increase and $X.X expense ERP labor increase the in costs $XXX,XXX million gas internal due due in reporting a ERP charges oil contract, XXXX. had decline reporting as profit in

terminated the oil million In primarily reorganization the in discussed. charges gas a with expense, XXXX. expenses in addition, increase of the increase in a primarily associated relating quarter labor member. increase contract And for the debt lastly, was talent to December just severance and of fees $XXX,XXX of there had on SG&A an which there the bad announced quarter. in with primarily executives searches SG&A of restructuring SG&A due accounts the consisting was to a in in $X.X was QX $X.X to organizational million expense There $XXX,XXX XXXX, and incurred over connection $X.XX changes reduction and for EPS XXXX, fourth We of Board receivable to

be foreign a expense of contributed and restructuring, in of increased item client in Code. tax loss the prior XXXX. an had we consideration gain will quarter. the year in XXXX, million This Other $X effective This a million a by tax the fourth we losses million of net billings. million results. in XXXX. a of QX fourth to basis. QX to the quarter compared and unremitted $X.X significant this of XXX% of realize million primarily $XXX,XXX of accrual with was anticipate million XX% and VAT recognized XXXX, for income on of the to rate result to transaction expense On associated the start change the XXXX, a to tax or making $X.XX effective $X.X QX fair of related a the changes XXXX This compared Tax a of in $X.X annualized contingent a the Jobs realized of Revenue to fourth XXXX. a the interest Cuts to reduction Act December fourth EPS due the Interest value due XX, to XXXX, EPS invoices Internal in nonrecurring undercharged XXXX expense prior a expense decreased quarter $X.X in fourth in to QX for In quarter nonrecurring year QX, income was when decrease will on quarter fourth to from $X.XX raised quarter majority Income QX, but in quarter. currency compared item savings to from VAT enacted, in U.S. rate increase quarter or $X.X savings As compared contingent

expense As of expense on provisional in a on income tax tax to this income based of of fourth tax the expense result, of realized. to earnings per offset reform on benefit effect we lower $X.X tax in was tax income recorded a to our by decrease which quarter deemed the earnings, are provision. diluted additional an of repatriation and at expected $X.X cumulative $X.X foreign This liabilities deferred the the a transition re-measurement related one-time additional fourth resulted income rate quarter. to estimated which reflect of tax assets This million the tax in XXXX share of a $X.XX income U.S. included be million certain mandatory tax tax the million they

For XX.X% compared XX.X% the the XXXX. was rate year, in to tax XXXX

Our in completed range low-taxed erosion is we XX%. XXXX income the intangible the certain estimate of tax income not like effect rate law, and global our This of include the anti-abuse of projected to does XX% projection as elements yet tax XXXX, per of tax, to due areas a diluted Net base or special or share share for new have fourth not loss is XXXX effect is $X.X was the discussed new compared best income compared complexity million tax our year previously accounting per in new $X.XX these share, new per revenue million negative a tax point-in-time or quarter in from for quarter our for of The a of for the million XXXX, the $X.XX analysis net $X.X was rules. Strategies a upon these of fourth the share XX, small $X.XX to of items diluted by change million or income of contract this a XXXX. diluted was January diluted On per where percentage-of-completion standard. to ended where share. primary of The to December method, the recognized Net we adopted $XX.X have reducing fiscal impact GP completion performance, per total or of earnings on recognized over our deliverables. in on a $X.XX contracts earnings standard of portion XXXX. of X, earnings method $XX.X revenue revenue now recognition revenue $X.XX

standard While revenue change impact we financial the don't believe the adoption in of in materially this contracts will timing of fluctuations to quarter recognition certain revenue. accounting our result quarter in statements, on overall could

the into system continued For the of update, of two Acceptance Testing first January end our an initiated at February. User XXXX that we weeks ERP

decided can't this April delay date. to we experienced we full issues data issues, were have these During of conversions this to complete unable go-live and and launch we testing testing, end-to-end of with to on successful X be Due system. a assured the

will don't the we currently live will One of that look the considering go-live fact that that ERP expect second for X if the upgrade early be target live, were the cloud exact as date current we would we which to XXXX. sometime a as version system as that factor are we go vendor has have of date prior software, is RXX. we new half to new to when take GP our the on be to October a an of their required in we added RXX, version is to software it While

in RXX, would it functionality matter the business to interfaces. if from assessing significantly of go on is few it of to user and go-live can different when means RXX we to with a avoid with that expense of disruption and RXX. the directly upgrade be the a and the RXX upgrade is live go on upgrade of It months process associated and a both trade-off delaying end live considered that an are months possible the We the go-live important added major then an within note RXX

the a don't estimate impact have As recent associated this on firm yet a this with delay. we very development, is cost

we discussions ERP additional implementation of million. be after This in partners, with the to targeting was somewhere to the range XXXX, that for will date. $X.X $X.X However, estimate when that be would in $X.X go-live addition an April were preliminary previously our million would cost the million implementation projected we

in compared of million, additions XXXX free of $XX.X in compared of up of XXXX, million provided Moving we XXXX. XX, hand fixed outside of the December is and $XX.X sheet, on to to the of deposit compared to balance $XX.X cash and previously in cash facility available debt XXXX. in of under $X.X the million a XXXX. million December on $XX.X in We operations million $XX acquisitions were at of XXXX, total for $XX.X $X.X million balances were XXXX $X.X cash on from generated loan million credit million on XXXX. completed and fourth from at of We the $X.X flow cash of end XXXX. acquisitions, U.S. which to repurchases, We million $X.X were end million outstanding share quarter revolving and $XX.X spent million our total XXXX, at In jurisdictions had borrowings in our – XXXX. cash balances $XX.X million of cash contingent payments on operations These term from asset generated $XX.X XXXX, had at flow XX, on borrowings million the consideration flow completed in million

gas QX of call be million international $XXX XX% contract within of Approximately million a end by At termination $XXX at of to XXXX been reduced as at backlog million backlog the I'll to of comparison next XXXX, Adam. time, a December the million, and XXXX. December $XXX result Finally, at end the $XX in the was and the revenue backlog of oil has December months. of the end XXXX customer. this recognized as an with of over turn will XX the

Adam H. Stedham

you, Thank Mike.

very that to the enthusiastic we to our reacting continue putting I'm are pleased We changes. customers changes be positively in place. these about largest are very

Over investments global us organizations restructuring to These on various cost, in this our have priorities. focus to our combining overhead the support areas, continue of by few measures to priorities. anticipate model. invest the undertaken enabled we fruitful rest enable reducing our we'll reduce the months, year to measures cost-cutting in aligning to G&A less were key and costs last We

cuts, our of of cost designed a restructuring five growth, culture top are strategic establishing culture priorities of building creating are, and costs, industry investment All our support service improvement, investment sales to high-performing and value, deepening M&A developing and expertise, a efforts, line teams. priorities. our These continuous

leaders into We our of and priority value. these have but five shift each on also a role it priorities. Sales growth Becker role for GP Strategies. only that on has of The focused supports sales M&A strengthens creation hiring of of culture Russ role our The very positive our been creating Officer Chief not

The operations operating Combining revenue industry to our more these growth to expertise continuous those efforts plan new efforts of areas opportunities. GP our Our are growth overall ERP efforts improvement implementation but is significant, line model We're enables service and process associated the with in acquisitions value driving and cross-sell the but learning high-performing between a very for are and revealing our these significant large demand and effective structured structured of our aspects facing combination system, process improving and teams margins. sales some lay ability a margins. a business increasing of with existing the through a the renewing for foundation the significant establishing to plans and implementing critical challenges service are our and contract, sales deepen creating long-term key efficient The our other managed our more and efforts acquisitions. for component Strategies.

and of our the business. operating we model Historically, involve to U.K. skills half have during shift are training, unit customer capital projects evaluating our margins job impacted the should to will model. they for still our for no is investments of typically engagement government but funding our customers the first changes to changes impact XXXX, which us various quarter continue business U.K. Our had in of prospect on U.S. projects. likely These operations, Strategies GP the many requires adapting Within encouraged long-term the to impact services. our some by these

long-term We continue see Pacific. in significant opportunities to Asia

industry We are customers to on Overall, particularly region. on that our we are confident track. banking expanding value we the bring I am focused automotive and in

We have the plans place. in right

a fragmented growth highly us to of provides the and acquisitions through organic growth combination strategies. achieve opportunity industry exciting Our

are opportunities in We experiencing activity those areas. significant related of to both

the call at this Scott. over back point So, to turn I'll

Scott N. Greenberg

you, making at many by you, took and I hiatus When up acquisitions acquisitions that strategy get could hope right contract world. and and good our won we organic nice on XXXX, growth on we year. during mentioned our service and resuming we niche acquisitions. Mike, more over first In both ones. Adam start Adam, thank Thank made acquisition to were to offices highly a our all your some we when and large the Company open than the we were our acquisitive by congratulations the When announced we of so double and contract, financial a we you acquisitions, XXXX business, business, from it's call. was XXXX look able

the you after million a items restructuring of of at well. into look of able our items the for Going $XX.X like XXXX, results, cash one-time generate as paying from loss and and to some flow some on we and contract that's were operations, the

So, into again. our upon XXXX. we'll that, was flow Based XXXX strong a in go as cash with acquisitions priority really

by year-end revenue. acquisitions is a run Our target in for acquisitions XX% least at rate

So, SAP hope component started $X during about with our at run first month they we Hula get we them would SuccessFactors to million, work, onboard. We glad the are January, have of $XXX XXXX in revenue Consulting. capital year. in million where right in in year closing of the rate basis million revenue the our of and Hula did our acquisitions $XX to if human you look are and in involved we bought over

in on and expanding pharmaceutical our acquisitions key we'll training, and working update we global particularly Board currently stand that reach, quarter at transaction the on at Asia would call, where both the space sales Other looking next Pac. at are in on include the are and the we We next those. a leadership, the automotive

So, XXXX, acquisitions part a and will Adam stating. be what key results improvement the of consistent with in the was

investors and Mike turn Before the All will coverage for them. meet that call. have say, now being With questions, to session. them, that turn three-month for season you I sure with on it and once GP we period, lot their and like analysts firms our a over and so Riley, you'll And Q&A it thanks accompanying this next where to be be could Research, Strategies, is said, meet would joining to the Capital, I'm research I conferences. B. all of our on the and the three ROTH Adam over investor the impressed conferences Barrington me do within I'd moderator, like have

Operator

Instructions] first from with question Our [Operator go Barrington ahead. Paris Please the Alex of Research. line comes

Alexander Paris

more XXXX, this So, to be be I carry it quarter. in implementation least other of clean last that at million comments now Is than noisy noisy to that the to was We they you going costs. based on got are on ERP got made was a few dollars pretty I'm assuming a going questions. correct? couple Obviously of a knew quarter.

Scott N. Greenberg

but half $XXX,XXX will that the statement out you cost of our we year, did first type in see correct, dollars there results. is the are some back came was predominantly the There forma dealing transitional with are cost When in our be of though, pro will Alex. with. of to transitional QX that we add about you not those That

be be ongoing thing, as will items other achieved than will implementation. we And of We only the while again, talking some restructuring the system most well. that QX it, we about in major other anticipate there

of QX near with nowhere I be once think but level the you So, restructuring pretty the it are QX, charge. clean, will done

Alexander Paris

Okay.

So, the does in Do $X.X $X.X million-plus real first how based million. you the guidance I number in that, that quarter anticipating And in? And we $X.X so roll be say, get carry QX the to million, so addition weighted? and $X.X $X.X the that implementation million. first fact in million balance you $X.X another was cost on But or in of ERP is of gave I heavily might was to then expense or your quarter. it now million

Michael R. Dugan

Yes.

So, you me just got here it's a rolling let in in just are around to but it's $X.X preliminary QX, then second, a it's another new in my million very realize I QX. and let's would number, $XXX,XXX a these QX, development $X.X very and million, say preliminary – in sheet – pull numbers. see, $XXX,XXX And

finalized it. haven't We

implementation our to talking there. just are partner We

this capitalization on-prem expenses We to to also have allow cloud software the creating and dealing with look capitalized in at is whereas that capitalize us environment, can environment tools be that not. that if we the are

Scott N. Greenberg

QX if that $X that be and roughly of to a you you in in somewhere now, QX roughly, in have then the for throw now. had But QX, probably million shot and say neighborhood in would of let's of $XXX,XXX $X.X million number, $XXX,XXX

Alexander Paris

then this be is from continues And from Kuwaiti noticed the to is $X.X a I Okay. there the million this – client receivable something or else?

Scott N. Greenberg

Yes.

As mentioned it billed over terminated that we on evaluated call $XX We we million. we mentioned the release, was press in our contract when we the as internally, with client or have evaluated our which of auditors, million to on of amount less that on our XX% determined the and got was claim. receivable advice, books, $X.X legal represents of leave our than we it approximately outside

Alexander Paris

a there reasonable your must will level be of Okay. But because on collect on that? that they balance confidence to continue sheet, be you

Scott N. Greenberg

level reasonable of what We at the XXX%. we mean think the are obviously I That's to least to are XX% collect that we we billed that entitled customer. going

to are rest. are than So we left when books for not we But little receivable, a evaluated it the the on our entitled not saying we we less XX%.

Alexander Paris

that Got and first goes? you. And go? RFP guess process how rebid first this it to contract that large GP had is that's financial a that then you does the announced on, on the extension of And way there services typically I there out a morning, Is my that question all, question?

Scott N. Greenberg

The the a of put size work way when them very large lot dealing with every large of companies, five companies out contracts years. bid it will to the a you're process to that requires have

done So July our and to or finalized rebid on year. long-term last immediately really much faster could year, us of be bank one hitting week quite five-year agreement. a this have in to extension. in working on in were in a We've this working We conservative, this year have But but the for this case, a start an would time, which new agreement recently time period, in extension the been extension we to two takes the obviously just some we to XXXX. order place so we for in hope July is this wanted of new

Alexander Paris

three And the then of a similar to you've duration long-term it'd be reasonable the to plus? to contract years last talked assume one,

Scott N. Greenberg

correct, Hopefully yes.

So that's at. quarter because it on big revenue, which look to development for of depending XX% us our XX% you represents

Alexander Paris

Good.

on the is important year, you've as is, the won contract, to is a negotiate extend step two longer-term contract? step but a one the for terms So, it to

Scott N. Greenberg

about excited pretty Yes and we're that.

good it's news. So

Alexander Paris

Good relief.

questions you or the So, I want queue. are little more go into back ask guess to two I and questions. one they I'll

than going are Just in two to you business QX, starting rather segments segments. the four in report business the

Scott N. Greenberg

correct. That's

Alexander Paris

not that annual that segments And XXXX an of are if to will plan, quarters of the with part you I do on you maybe urge couple that's for can be we planning data. X-K historical the and what get a Is that some historical filed of of doing? So, years information?

Michael R. Dugan

to been back years more. able on be and I've restatement do should already we working the Alex, Yes, three that.

data. will have way So, you that that

Alexander Paris

be other two segments of not together. two simple not helpful, then because the involved of as would okay. stuff it's that together Yes, as – simply There little is it's of and a putting there, the other segments bit

Michael R. Dugan

Correct, yes.

Alexander Paris

you XXXX? And organic in million it the growth, then, what year-over-year? $X.X organic what lastly, let's to, growth see, referred was Was full-year

Michael R. Dugan

Yes.

Alexander Paris

Okay.

XXXX growth X% then? in was roughly So, organic

Michael R. Dugan

That's correct.

Alexander Paris

have To sales this So from effort. from million without with $XXX now organization, to you all initiative sales to on million formal a focus sales got $X billion this get $X $XXX now. we

year you'll are accelerating we some into I growth then the to assume to quarters don't an XXXX? if reasonable range organic get it X% of know historical going of So there throughout back point? is X% get to at rate that I but would assume this

Scott N. Greenberg

We are of our growth. obviously organic with levels disappointed

long-term we above said would always We it that growth have like organic X%.

based to think a this transition, are year we and objective for and believe have is should period. Back I that the ramp we of up five our it I so do of more next is upon year long-term it's it part objective, the where see going.

XXX% correct. are you So

Alexander Paris

Okay, good.

accelerating like rate. an revenue then year So think growth, being $XX made your XXXX more in run talking based accelerating about are $XX run acquisition, of and organic on rate with prepared million you comments, I now of acquisitions this pace and million-ish, you

Scott N. Greenberg

That's correct.

I have but January. think might did we the in that's I'd to $XX million one included go the back, have correct.

Alexander Paris

you Okay, much additional information. now. for it that good. Thank me very for That's for

Operator

from line with comes Jeff Partners. ROTH of question next go Martin ahead. Our the Capital Please

Jeff Martin

high-level wondering strategy. if I outline the you could was

the you How strategically. see after you historically? differing going next process done sales have versus years that over business development should how evolve specifically several and what are the You

Scott N. Greenberg

right sale of now components. consist Really problem. no three the strategy Sure,

referring them the organization. simply as terminology simplistically common are find-win-grow We the to for within

So, done growth. error flawless a executing are really and job it contingent of low historically been materialized our has will you of execution strategy, rate, really very for process, that. which this, into hasn't flawlessly, at is 'if grow component execute quality, grow'. it But known And upon we the a account high thought the account management good we've

that account deliberate say operational-minded be a to to those expectation together supported management who need to the we value a the are to the we delivering basis, strategy but not year, at flawless need customer that more managers putting year. on account next But by continue if to be we should to individuals year-over-year are to we mindset. do execute So growth this is are looking able deliver customer a only value

growth component. So that's the

leads On for component, trying initiate and sales, had meetings. function, we folks never us really generation the have demand uncover possible demand generation 'find' to being a really outbound

generation So, working plan Russ now. are we is up right setting on demand a function. that

in put more us are to opportunities. We that place give getting

'find' focusing So, really we component. are on the

As for very rate. actually good close the 'win', we a have

a that very because is One of to sales having been work. to process winning able we good get the are have rationalized we the without we at are reasons the size

less a because results them. to and of more are find just strategy. effort have component, achieved execute, we or we we we focusing win need would customers then have, flawlessly focused are growth actually we opportunities percentages on high And can wins I 'win' the not So, say higher the historically on, more we let's to have enough so for it's

account Does together together answer putting we that question? put that. for in your So – plans management are

Jeff Martin

that's Yes, helpful.

going those internally business internally setting are help you how I how industry, the understanding And is what sector, in by also structure, up this? to by are think and to are teams alter development reaction structured? the if you teams

Scott N. Greenberg

year So, is a this transitional year.

services transition be service into spot are year. into lines will But and centered are next operations for different fully multiple geographies. around you going we industries, provide looking on. is across model our to what multiple Really going we this We are

focused primarily market is be Our business going on development geographies. to sectors and

which words, other development, so service running a like organization. in development executing something expertise content we a who line, and have in we if have is So, effectively take people content

the directly explain bank, region. business industry. focused in to able North to our their in we a to to South industries versus we're talking customer we Our that line how again in so conceptualize going capabilities how to development applicable service service are our versus life be when directly is if are America are then help we to applicable line sciences once to are customer working And Europe versus versus Asia America, is their customer and on able them a geographies,

along mean market a exciting things both and should to matrix to simultaneously. and sector would line so this passion is we is two or those be very follow or a is their organization organization, a people allowing model naturally far I those of for I in long the reacting organization manner. us, So concept say, the matrix been it's debate going lines. this the fit to of a accomplish an we be should industry service

Jeff Martin

my is question Okay, last great. And for Scott. then

start were or a it thinking further about On that, was pharmaceutical that very, grow a that it's financial buildout very slower give ago know of – similarly an back six been I initiative, was you excited was update major maybe to services. just curious sector, can could you to a than industry there? your than little the was little an that us wanted months going it. if bit the but current expected, I know you view on

Scott N. Greenberg

I mention strategy, pharmaceutical. did So, was one about areas acquisition the earlier I of when talked today our

it a I than in into is award and potential anticipated. initiative One is that's announced, much still Company. it the award So break out we can been the pharmaceutical two-fold. a major or large that slower going

but the are working rollout on We it, slower. been has still

good a but we with still to that a content not expected. work as dollar lot GP a account pharmaceutical account be originally as multi-million large companies are are other and But as leadership So to of expecting and potentially in we development. well winning

going anticipated in do. industry we been but believe So diminish probably and it's our large and as I that the it's a that about potential we a the going initiative won to well. of the should slower are what Company still the has won potential not than or anticipated originally one major one smaller we'll and pursue, than we large But we feeling

Jeff Martin

Okay, that's helpful. Thank you.

Operator

from line go Please Liu of comes ahead. next FBR. the question Kevin B. Our with Riley

Kevin Liu

scope that profile you change you quick or extension, kind is are margin doing HSBC change question you multi-year any one there negotiate in and terms agreement? for the the to then would work of follow-up Just extension, one-year on anticipate of as this of the anything the

Scott N. Greenberg

one-year Right now extension pretty for is as part. the much is the main

expect changes. July of to XXXX amount of through we have So, limited

financial be of a them, that changes, the but we slight there at and and that doing would stage nothing know We be working with Company materially between on might institution negotiation them. new the for some so we will be the are work will agreement this a impact and there

Kevin Liu

then, that I job has of of talk business And that of council the skills XXXX there some forward? the fourth how been see impacted kind that Okay. moving maybe about how think you quarter changes, you some in those you Adam, the and on side. mentioned changes Can

Adam H. Stedham

companies XX% to to fee, change and at that pay, approach voucher and now, are April approach Kevin, of look job where Right large pay and companies year, a before able have they've the have where get small to they the Yes. they companies was their which Funding if it in pay changed you came Skills tax last use. a of skills, free, the

– old under we first first give And system. an relatively look didn't have QX in talked quarter, tell, pertain fourth quarter a too you think fourth we December prior revenue it also The actually the relatively it were to we the have made corresponding but will quarter maybe it, probably that to you quarter-to-fourth quarter-to-fourth new year, through acquisition the was hundred we it, by under but of were thousand, the early – breakout So, little we'll at few the which year. quarter. the the was April about fourth when or at if down the beginning of system, year, of year, last in QX we but and this the but a it's quarter – we I – this

without $XXX,XXX. core you it quarter, business looking the was down If quarter-to-quarter, acquisition, are at the about fourth quarter-to-fourth

Kevin Liu

kind not at of quarter, was side, into the and levels for it I sure of out And looking skills profile gross if if to was I'm margin there? the is revenues lowest the but fourth Solutions being side Got this just anything the know Learning think curious year in tied it. job up, for despite cost within kind I there the whole call the

Scott N. Greenberg

probably it of the quarter reorganize went somewhat to of significant a lot skills. do in amount we with change No, as the job the we fourth to that probably $XXX,XXX A has was and the cost always margin. think fixed

Kevin Liu

right, it's helpful. All it. Got

Readiness talked touch about $X margins. beyond as bit So, we really little doesn't that Performance impact year, that a you growth for kind about this think on of organic the million

year? should Just be wondering might a revenue organic that headwind side if of there be the is we kind growth that on anything to of this aware else

Scott N. Greenberg

I the think of. all that disclosing we tried we items know

mentioned Mike Just year. impact the a there contract year we which had six well. is, one change that the a contract, months our we the margin, this didn't have of little first a bit oil but last as gas and summary in is doesn't revenue of

the the major but full year, well, as at fluctuations, Mike So, point. of as There I think items any we as be could major this know about don't quarterly of. we far talked we other know as as discussed items

Kevin Liu

you into QX any just me, lastly work sort all before had the have has some the been going changes made as these And were for made? that you pipeline changes, kind of on of impact it. of there organizational Got of

Scott N. Greenberg

develop it, we've a to actually has that and look the anything, more ability done. We the had of meetings own meet used you work had higher we McKinney had actually before. to cross-selling in develop to lot I firm, to we I spurred of on if more achievers abilities, if organization work type Rogers, the think at a think plan, our global lot meetings, do that organizational of

few larger So, we opportunities but working are – we usually working again, right later on in on, pipeline. like now on a until we don't commenting are the

the license from and a new talked you Adam the contract. bring the on could being agreement in backlog excluded We Mike are if work products. Korean working that up backlog, the about

we by anything, pipeline were changes ability strengthened and the our that again, made. So, I if think

Michael R. Dugan

Just the and not oil of Korean gas contract. contract, the correction, a

Scott N. Greenberg

same. the discussed Yes, contract, sorry. Kuwaiti mean results. I We

Kevin Liu

right, good. for All the sounds in good Thanks luck taking questions and XXXX.

Operator

lines phone on There questions are at the time. further this no

Scott N. Greenberg

look of Thank us new conferences on you We'll in joining we the you, forward to for place the moderator. future. team lot in really and see with a upcoming call. the the Thanks

So for thanks joining us.

Operator

that conference you that for ask lines. Ladies you for conclude please disconnect thank your does the gentlemen, today. call participation and your and We

GP Strategies (GPX) 1 Mar 182017 Q4 Earnings call transcript