TBI - Earnings call transcript Q4 2019

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the TrueBlue Fourth Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions]

I would now like to hand the conference over to your speaker today Derrek Gafford.

begin. may You

Derrek Gafford

and here everyone, for today’s joining Good our thank Chief I’m with Beharelle. Executive call. afternoon, you Officer, Patrick

begin, subject obligation to to differ remind to and in revise materially uncertainties, slide actual forward-looking I or assume today’s risks all we no in today’s described we statements, any which are and several presentation everyone of are which of update cause and call our contain Before that in statements. forward-looking those could release from These our and forward-looking some results filings, risks to and uncertainties, SEC press statements. want

Relations measures non-GAAP for of understanding terms in use same you earnings on a to and financial the these Any the comparisons the stated. to their when based We period Investor results. year, are today’s We in trueblue.com encourage made prior section presenting our otherwise comparisons at today release complete reconciliations non-GAAP or purpose. review the unless under

will be conclusion of Lastly, the our and full the and a soon be on call, audio after at providing transcript remarks available of we call. will website today’s also our a copy replay prepared

turn I’ll that, Patrick. call over With to the

Patrick Beharelle

today’s welcome and you, Thank Derrek, call. everyone to

wanted I X% net of income reflect year take had revenue and a Before challenges X% decline into quarterly its evidenced XXXX. decline. This I dive results, a to share on moment to back past by a

number of businesses. that Some of clients smaller the revenue and large a decline was experienced from their issues expected simply within own came

in lower in staffing as to industrial year unfolded, providers to revenue broader we volumes. back trends pulled the saw similar softening As a clients other response

makes X% sparingly businesses contingent States, experienced the data the of uncertainty. of job was more the the overall positive pullback contingent portion, light services economic United which up rising While as in use workforce, for

cost we environment, macro the includes smart balancing what control, focus control on continue will with cannot we strategic management we can to which While investments.

selling, satisfaction we’ve general in actions by management prior to we expected in to down At came to clients savings targeted usage. the and are critical team net time, making million, long-term $X the to in same curve client by team. our year. early is client In the and move This of One investments of their approximately of administrative $XX our cost proactively million during compared more is understand marketing PeopleReady’s in quarter, out been XXXX. example with of help the drive total, terms pleased am X% on reaching the cost sales and days and of that professionals than expenses set experience up In success efforts annualized retention dedicated I the care roughly XXXX. a focused or growth. result JobStack a announced new the to third in

branch is new, program the positive. While our from the colleagues still feedback and have based our clients relatively overwhelmingly been

also program. is to team strategic activity drive proactively more our helping The through cross-selling

confidence that our we’ll Our X%. me the generated cross-selling path into the the of for we’re boosting nearly approximately XXXX for $XX industry on combined company by strategic XXXX our team and focus with in sales leadership These and maintain million growth beyond. investments efforts gives right

services are for differentiate we increased and digitally Our believe transformation and leading edge is on the share. that digital industry we market our ripe capture

our they connections. that human stronger Dip] help to people-first technology digital businesses realization accelerated come actually adoption businesses and can [Audio have the always recruiting in with of has been strategies build

a the a call book anytime, to to morning its shifts they app or can digitally is JobStack mobile since branch Our early go having onboard has in for inception than a anywhere PeopleReady text. nine app every that workers, After more segment through X jobs has we an job currently million a filling proactively called and seconds. wait or filled versus our

On side, can assignments XX/X. the post flip clients job

disproportionally we XX% XX,XXX we’ve year is hours orders it business. XX% from our transforming to ago. just way the up JobStack, seen staffing potential variety are friction. digital businesses. removing from of Throughout JobStack one are we capture leverage clients and Approximately use we is than do technology, of branch a pop heavy wide of fragmented wallet of growth of and industry traditional and As regional more begin revenue now power more the even placed outside XXXX, high believe JobStack. we focus there clients on And users as is that across highly process to mom share The

services opportunity PeopleReady I to believe to capture the our with share. us differentiate market clearly strategy more our JobStack provides

future PeopleScout’s On convenient. our job more friction on Moreover, industry. implemented the applying recruiters experiencing is of fully to improved are clients time by flow view the reduced for This are for making candidates candidates of and Affinix recruiting full-time the candidate and for and fill that our simpler business, side in for candidate Affinix outcomes clients approves satisfaction. a and

connected whether people is jobs and in temporary it, remaining the their half another who via to pick company. segments, or truck our having in to proud a staffing on rent with to comes PeopleManagement XXX,XXX either of connect industrial half and at time jobs with up workers time or mission to PeopleScout jobs their a lay has work through college these who a happy segment. paycheck first Each Our TrueBlue is were XXX to own between Approximately the full Fortune connected is pay our driver, we’re story, position to were work worker people of it who full is connected XXXX. recent to PeopleReady used TrueBlue unique grad,

we’re connecting good and for TrueBlue, more years work people been at at with very XX it. than we’ve Here

continues and a strategic evolve, this. of exciting continue find great ways expertise leverage is we of and work new As to our the example Uber to to world relationship new Works our

area not have Work managing Uber platform, experience one great paying a is and do Well, has they employees. W-X in

a service for and booking workers created help we’ve the new on Works app. jobs Uber business called as Uber employer turned serve So to and venture provider payroll for Works PeopleWorks the an TrueBlue

it’s PeopleWorks venture, we While for days early its excited about potential. the are

fourth Total associated were Now, let’s was own economic discuss X%. conservative during our our quarter and quarter down the of with in in uncertainty, the business their particularly in in physical goods. QX Clients volumes industries use for softness services the continued revenue of light results.

While this I’m created a demand challenging environment, results by in improvements and with encouraged the services. I’m pleased strong management cost recent for PeopleReady our

the during the profit and revenue X% is to lower December though in was and business in of total was of in improved PeopleReady’s minus the business X% base. let’s closer quarter And for than leading shift. Thanksgiving the did market. down see decline client worse PeopleReady of take due our across represented businesses. North labor a after activity XX% adjusting three we at skilled Now to trend expectation, this performance XXXX. industrial of a slightly provider on-demand holiday our staffing our American look each segment company revenue fiscal This the trades

to runoff down total Revenue was XX% of company represented workforce duration Turning workers. to our XXXX. due American the contingent perfect previously that segment, market segment and PeopleManagement X% versus in the of strategic revenue staffing solutions onsite improvement This fiscal clients a value is offer in next needs fit provides XX% compelling QX industrial with longer for disclosed down in in XX% revenue QX. business headwinds. The profit larger North and for of

in permanent volume and disclosed our less through represented process recruitment headwinds, and global to last managed from segment, offerings the to total previously Revenue XX% PeopleScout and another the XX% quarter, during service XXXX. namely Turning filling positions of being our of leader was down and profit revenue that due client primarily fiscal is XX% provider outsourcing large in and after company was less client. lost acquired one margins segment

some as economic political in client on volumes. business UK our We PeopleScout and uncertainty softness also weighed order saw

path made As pleased on about we books ahead. strategic excited we’ve progress closed XXXX, the the and with the I’m

share we marking Our shareholders that is strategy very pleased position, and shape share excess free we by return that via balance to When TrueBlue’s in third pleased competitive in sheet capital consecutive I the approximately I’m and of million to leverage at to digital have excellent year cash exceeded able $XX repurchases $XX XXXX, look million. flow annual accomplished. repurchases we’re are what

and using We have workers more ever our before. than technology clients

a growth. new strategies and capture provide year opportunity I services, decade, industry our differentiate deliver into digital to believe move leading our and further we additional As market share

over call the pass share greater our financial Derrek, now who around detail to I’ll will results.

Derrek Gafford

was which million $XXX point was the of off Thank $XXX was near step you, of revenue in the the and did than resulting softening Approximately that project of down Total than larger revenue continue to decline our percentage revenue was share than earnings was work expected low Patrick. with one but Total Lower results roll of expectation. deliver QX, due SG&A to by in impacted that expected X%. our not lower demand $XXX positively per X%, QX, line million of due efforts down end to trends. remainder in outlook. offset were in QX the to expense

credits. was rate $X.XX was was comparison XX% was income a $X.XX. to diluted the diluted contributed and share as well per to of down XX% with XX which EPS primarily $X.XX XX%, tax EPS line our effective Net net additional EPS adjusted to income per about in adjusted for of headwinds, as to share income disclosed rate down $X.XX outlook decline. X% points previously $X.XX a outlook as tax The primarily $X.XX of in due our percentage that to of result expected quarter, below our

staffing was margin year margin business disclosed in in holiday tax gross our PeopleScout additional our and and remainder staffing from the season. the of at down our business. and PeopleScout with was associated due a gross prior benefit costs margin peak shorter XX.X% a associated business Half of to points previously Gross with consolidated payroll lower headwinds drop XXX basis

to of the the was Our million, adjusted our expense in lower $XX costs EBITDA and $X down exclusions this from SG&A lower core million in to managing business. cost disciplined due was remainder approach quarter. results showed which

SG&A being these and large headwinds of some our XX was any impacting isolated margin businesses. client impacting The on QX volume lost revenue PeopleScout without QX lower Throughout down PeopleManagement X% a within as segment and discussed another points. of we after percentage PeopleManagement were the was up headwinds associated and our within headwinds revenue our XXXX, and acquired business. profit first was and basis only business SG&A one account. with client quarter PeopleScout

will XXXX. client first a headwind being see The QX after us

XXXX. client a see headwind The second us after being will QX

company million. release suppressed For $X these QX XXXX, headwinds. revenue more information these and regarding adjusted EBITDA million earnings by total by Please our for see $X items deck

$XX drop and XX% gross down EBITDA due margin, of a Adjusted also adjusted basis which million was lower in points. contributed XXX margin EBITDA to to revenue of

This flow. million total leaves $XXX repurchased to bringing which full common of we XX% $X free quarter, million, stock, our repurchases $XX the cash of represents authorization. million During repurchase of year

Turning of the decline from step mid-point down of QX. segments, of revenue X%, to step did was down in benefit from and PeopleReady one business in than industries. project our core the lower which was due X% in declining in expected in Contributing demand with QX and manufacturing X% to remaining was decline our QX our down trends not the was trend the the two work points continue of the concentrated softening construction that and clients to a

However, into for December see continuing holiday to improve decline improvement Thanksgiving with the revenue of weren’t a X% shift, trend to after we encouraged adjusting the January. in

year, matter QX that and see the X%, whole. PeopleManagement lapping the as revenue trend be to XX% yet our of due to revenue QX. improve had the a have we benefited decline with XX% from in Segment the tax the decline impact last year revenue growth, previously PeopleManagement was to prior was Well, timing profit are a we neutral QX consistent of for year down disclosed payroll expectation. but to and our headwinds pleased in down a return for

growth prospect wins the revenue with in new business about encouraged up XX% also are XXXX. We future for

in in to XX% was profit Segment with revenue is costs occurred uncertainties results profit and XX%, decline due primarily the was was previously our in recruiting PeopleScout expected XX% headwinds UK. business the was down which surrounding than than of the lower minus the incremental a down our lower minus season UK and additional revenue discussed Segment Brexit with to down XXXX. associated vote. due decline weakness expected The XX% X%. shorter revenue associated the primarily to holiday which peak

flow earlier. of X% $XX from operations Turning total to from a and at cash netting and flow to million. adjusted On down X.XX. expenditures ratio totaled a basis, million the of The our debt cash the balance million is multiple debt-to-capital stands compared year-to-date cash for capital $XX million XX% EBITDA sheet is $XX improve. free to million $XX flow continues year Total strength our of were to month company, trailing XXXX at debt $XX the end to XX of overall

quarter a is Turning of incremental and The expect consistent with to XXXX, minus first current X%. QX we minus of of our outlook to for an the revenue the X% improvement midpoint range range trends. from

We share assume to of of cents income expect share basic million. range $X.XX a a count figures per diluted share basic share an or net range per XX.X These count and $X.XX. diluted to of net loss $X.XX adjusted XX.X a of million $X.XX

measures smaller to in translates is QX The that a diluted profitability It’s base pronounced our decline revenue lowest more of into per year-over-year adjusted provided has to important income an all decline relative revenue adjusted QX outlook quarters. other the year. due roughly of net trends on volume impact in EBITDA the of Consequently, XX%. know profitability share QX we to quarter and dollar the

the the pleased extended Also headwind for mentioned to In clients is the million I Credit year. Work contributing our at Tax rate, profitability EBITDA $X regard Opportunity another tax earlier. to in adjusted drop of we effective were was two income from

rate We about fiscal for rate previous expect and XX% QX of tax XXXX, which than lower effective in income is XX%. of an our

more and not economic While customer moving we acquire oriented plan to to industry believe to but to the economic leading climate out acquire staying and We only initiatives are digital and differentiate in digitally business our share. come the invest we’re ensure our when business we strong to more services uncertainty market model a exists, We improves. to acquisition strategies. retention committed

shareholders This now managing concludes stock are We Please call diligent in stay questions. prepared to also through open lastly, committed for plan our And costs. to our operating the returning repurchases. remarks. we to capital

Operator

your [BMO And from first Markets]. Instructions] Silber. Jeff comes [Operator question Capital

Jeff Silber

bit a January. intra much. prepared little us remarks, you in In color your of Thank trend so you on quarter gave into going trend

I’m was you two just other it just about that segments PeopleReady. be could for think would mainly the I wondering as well talk great. if

Derrek Gafford

to do We’ll a the segments. PeopleReady for more maybe I’m other a Thanks asked bit going and question, little the color the Yes. just with start segments. Jeff. other since same on Sure. give the you’ve bit, little I’ll off

down and We’re expecting continued fourth to into third quarter the the put perspective, see PeopleManagement down trends. this in To improvement was is XX% quarter X%.

is down kind is trend we mid we’ve And how be of of of the line assuming will point we’ll guidance, Our it what think with that seen about which January X.X%, right. in itself out.

optimistic that into XXXX take were the had, what of some PeopleScout, of decline So about you for and wins the five we’ve worse anticipating QX. get that like will rest we for points going we’re looks the about PeopleManagement,

UK We our expect to still Brexit see business around in some the vote. pressure

some for into expect to related up, business, legal be some but back rest year. RPO communications UK we notices so slow having and going that QX of addition Our continue in in the forth business QX and to government. business, And to the has pick doing the

encouraged but the we QX the the for down about the our be at in up them where some recent still trends, where X% down In we business that there finished outlook finished been seeing X.X%. the trends negative, down nice and The adjusted we’ve trends still were December, for PeopleReady. for Thanksgiving quarter, are – be, to holiday, X% turn the by demand not most is to PeopleReady about for ones want is

only comparison a a for had growth that’s X%. decent relative and in At that’s So, us PeopleReady us. we – at QX quarter of positive year last top on least was quarter the in pretty

some do over but We here, by seen encouraged PeopleReady, with we’ve trend. to last weeks. more pleased we’re what into to do see easier few we’re work comps So the get the

Jeff Silber

you, you helpful. That’s in represent. PeopleReady what When percentage manufacturing. appreciate Okay. about us you verticals demand the were discussing specifically actually front any and of noted remind have I within color. grew? verticals I’m really I of the construction just there that synergy or that of a softening the whatever were company, wondering those two segment you talked and you just Can you PeopleReady, as think

Derrek Gafford

Sure. here. One second

just going I’m So to

Jeff Silber

numbers. Rough

Derrek Gafford

I’m manufacturing. going construction related which what to is work of give energy our mix for business business, then excludes any the you core and

for are, the trends in a company PeopleReady this total over then be I’ll to these can and So go moment.

and all of represents construction of overall of business represents XX% So overall for the TrueBlue manufacturing XX% about about a business. the

from form vertical down all about the about If of widely pressure the some we pretty We go of PeopleReady XX% decline. industry of grow. this of business of up PeopleReady, the we’re you, had makes taking in the at to and business PeopleReady’s over look segment amount But to roughly that we that serve, verticals range a manufacturing basically we’re energy X%, was the for give of the up, that they related that the And do down and did was verticals range XX%. have least hospitality, whereas some of all of makes that business XX% business. those

Jeff Silber

color. I great. appreciate that Okay,

me one back I’ll in follow-up queue. and just, more Let quick jump then

You called remind in the of that the UK other people you soft business. you weakness segments? what just out percentage Can the of Thanks. the any UK us segment exposure and in have do is

Derrek Gafford

between million of us. runs Yes, $XX for that and revenue million business $XX

we’re to million in million little business. $XX North $XX $XX closer of that million, I think

Patrick Beharelle

UK And exposure. that’s where the only segment have you

Jeff Silber

that’s I’m understood. I what soft, you called right. Yes, much. But Yes. so you I the meant. sorry. Thank that’s people PeopleScout

Patrick Beharelle

in time that in called, over color some And government seen in results We’ve government the came and was UK. pullback a clients November. saw there in. is happened partly actually as those saw little there softness a December until in This January back November. little bit a called was saw and that Jeff. actually What we is, weighted the the we’re October, because real more we Derrek when related, and was election so new pretty on October the versus we Patrick just of are from bounce really a heavily sector mentioned from election and what the

that for those lot do had business work it month talent those a advisory QX. doing on couple and it hold put over they government had just of lot to created us window have there in with with that it where – the And a of for we we’re headwind clients that a

Jeff Silber

Okay, great appreciate color. Thanks. that was really Really the helpful. all

Operator

with North from And Healy your next question comes Coast Research. John

John Healy

to Derrek management. ask Thank wanted the you. question cost about a of,

talked to the investments I of probably slides the as understand of there’s about levels digital revenues the and savings, there’s some guys managing probably think productivity you with in there’s you SG&A some the on. kind transformation But guys have going business well. understand – but

So revenue. year to about to this should how hypothetically about just think think relative trying we levels SG&A

pronounce if hypothetically So on of match level decline is do X%, were that think to an of and basis, your move the revenue. enterprise what you what to sort down kind SG&A sort you revenues would the SG&A of revenue

Derrek Gafford

for Yes. Thanks question John. the

your to bit others. to So to just a that going in you think give I’m question I’m little to moment helpful of be a and going directly answer just may I background but

So We to definitely a sales, XXXX, of referring expenses by administrative and was disciplines. year $XX of million. expenses. and cost I’m lot here costs operating reduced general a

that and was lot good a So tackling. of blocking

we particularly I PeopleReady. related the businesses, that of bit more things restructuring, some a a little where fundamental did some did also of in some, would We reform call

demand cost-wise, is feel what done wider point scale of that we’ve restructuring at million we did will because what quarter. needed we’ve savings larger this actions, done individual third I any That are, And cost in one $X as the XXXX. to the we as was feel where PeopleReady give in business far just like we create do. we about like that the levels as background last in our action

important. get wrong. Don’t are me Costs still

environment kind in don’t got anything managing demand, deep make do to turns. weren’t still want too we disciplined we want we now. to size We’re big respond to that where way, a when we but right feel we ready of sure the We right make but the like go sure, those also not to need businesses to to to

strategic we the look right at we’re about spot in more perspective So a when the take from we think a costs.

getting SG&A QX, that I into that amount guidance you’ll revenue at X%. midpoint said, that would about – mean Now going of past. of that that off from done have unless actions in of other suspect We’ve about things cost we’re I that benefits a taper we our will heavy declining happen is the got some in the decline SG&A decline expense kind because to, still itself

the whatever half same, However, business like and by vary would like revenue by a we the now that about that this is declining while the on feel and particular would SG&A to points, we the general percentage half, amount. decline, manage quarter rule, about be

would down course the down for if X%. revenue as manage in was XXXX. a I of think be look example, But different that’s based timing I to we lumpy, So, to expenses is to quarter. general forward of X%, applicable managing on think try we we’d rule, be operating That that about and

John Healy

you great. the row I you said year third the a in of Okay, And to think shareholders. you is Great. $XX capital returned point, guys over I where sense. million Makes this guys think then, made

that kind the on you past? for of for as As priority cash and do you at of feel going wait think the keep yourselves the today, options to continue you in it’s seen high business in to a state prudent we’ve more that day? do look Or to repurchase are share as rainy like list and that’s the be those the kind in

Derrek Gafford

now John. focused much for is for John really become if three this know more this, Yes. years aware Thanks and the here, appreciate organic of you over we last strategy I our asking everyone two question, the I or you just versus that highest lot has business the the saw digitally part be right can that we the is decision and think plus on that’s we important more our activities years really acquisitions. strategic doing. because a And, most went a return back three transforming

us certainly which there buying transformation more much than while shareholders. going capital is cost means we’re putting that investing the So, with is return less leaves to into companies, what we’re digital that to all capital that

stay plan we sheet. So to up this. balance lazy to a We in don’t active want build

And back on doing a third well. we’re amounts EBITDA want sure got returning it but a turn take on consistently, like to to of planning doing about of to make we’ve as We some make shape, is We debt to capital healthy also shareholders. want continuing So we of sure stay we’re and opportunistically healthy as that we’re of the the buy sheet great in to could balance as balance some debt. we on more opportunistically well. sheet feel

We to wouldn’t capital our of Maybe but get in ahead latest our today’s use too far on ourselves. are John. turn-up those thoughts repurchase environment the and share debt thoughts of on

John Healy

Okay. Thank you guys.

Operator

your from Kevin McVeigh Instructions] Suisse. from Credit [Operator next And question comes

Kevin McVeigh

mentioned Great. think had Thank Derrek, wonder losses you I couple of in client you. the I quarter. a –

any there client into QX loss factored that is Just that any and context around guidance?

Derrek Gafford

that continue large are out, back. losses on, Well, Really we’ve having be I’m a main have clients been we’ve client manufacturer those headwinds a clear the another or aerospace that where headwinds of who’s problems. at called now that going headwinds, main been Kevin, had. ones because we��ve losses they make we client PeopleScout; of lost some acquired couple reporting couple just to reporting want headwinds lot the of a we a two right sure – about are that’s I them or to what and We’ve on lost got and this. we’ve And one,

on in wanted out enough proceeded were them we the trends that the necessarily But the this call to clients that company lost significant because quarter. of ones PeopleScout. and they quarter, the weren’t They impact

make that the client to bit Kevin. were of going look that into provided our referring that losses materials, to how at and investor I of a pause headwind to, XXXX. some And a But continues we’ve those little want were in there sure you provide

Kevin McVeigh

They run would could? were. you not And they think should just impactful Derrek, or those do any start off when sense as kind if ultimately to of when of you

Derrek Gafford

the to large one down this aerospace point. really it’s manufacturer Yes, at

off the And is, that out expecting and client headwind. then $X about million But we’re by so About million QX. QX we’ve of from no drops itself all that to won’t of with headwind in which laid tapers in would through and XXXX, you. be and quarter, in $XX QX about it picture EBITDA happens revenue of headwind roughly all go of big QX that half I over headwind

Kevin McVeigh

it. Got And terms you and in guidance the overall? always January. relative in just December to the environment backup how then in of year of ultimately then end There’s the macro any start thoughts the sense

January macro like a the a from thoughts any perspective, client are how a better, So discussions the bit trends going little just perspective? from but are

Derrek Gafford

the Well, for good more what And has indicator of far we’re business. not collection of running projects of lasts business macro the is the in trends, us our work on experts our trends experts the a on a history to versus that this, small told it because macro, us, of PeopleReady PeopleReady particularly that sometimes or is much certainly longer few – assignments. as the very some our as macro leading when comes macro more it’s a for in weeks blue-collar industries days industrial space. Largely very,

off. – when see turn and quicker drop So we the to we tend than things also some others positive think

going feeling our – they’ve we’ve been over that we now talk trend our in second, to last very probably first seen, quarters. most is were versus the recent. we our about much three thoughts or were into third thoughts changes the than The This if more quarter fourth, right optimistic we’re

positive here. So sustainability nine slipping seen seeing their us. very least it questions doesn’t to months we’ve what some demand and with – traction over months, there’s It’s versus encouraging XX the last still for at

I’ll across between virtually smaller every that stand it’s the now. And improvements been say the that demand that middle that of industry pickup we been also we’ve PeopleReady very trends where seen, and getting widespread. December I’m decline talking about It’s the

into are will the encouraging small results. see of as it And lifting, widespread, feel of amount probably we what if but think you over our some which we results So carry factors for time, in is our macro well.

Patrick Beharelle

this Kevin, had PeopleScout. going on Derrek the first to question you just around I’m follow-up Patrick. to is

a on in in basis, raw QX, PeopleScout million Derrek look year-over-year was that We million manufacturer $X another you down $X that If or mentioned. of dollars, so terms UK. was it had million of $XX at about aerospace about the

things that those clients, seeing a So is, the those bulk we’re that we’ve trends up of wins historically. seen we’re of In of And XXXX, the lot lot a one XX deals. but smaller the what relative we has nearly two than size in new winning the of make decline. PeopleScout us been had has concerned

what’s is lot of right now So year-over-year with used impact an that a we’re lot we we’re on coupled our QX. and winning our in results something And a headwind. is, rate with aerospace coupled that’s for that’s that QX deals are UK the of winning having to happening And that’s deals growth headwind big. outlook the that small are that find

So of smaller working wins clients turn to into take with and that expansions had we’re larger the scope them we’ve hard those and like.

of a going part with PeopleScout. And that’s big on what’s so

Kevin McVeigh

Thank very That’s helpful. so you much.

Operator

[Operator Josh your question Sidoti Instructions] Vogel from And with comes next & Company.

Josh Vogel

evening, Good hopped late you. Thank here. the I I Patrick call and on Derrek. apologize,

first you’re And commentary this I’m on plan that talked quarter drive of year, first flow. sorry. your of is, something had any I out with to other capabilities are and rolling digital about more last still the strategies that’s help JobStack in at some is business features, curious you or that also if there model? could the redundant, My questions candidate if looking regard I I’m So these believe question or quarter new

Patrick Beharelle

features, flow you’re what some is through then that into Related onboarding. onboarding referring to Today is Thanks, done the to new systems other our Yes. the Josh. JobStack.

hire candidates areas the frictionless assignments. we’re and into so focused much ultimately and them them creating a billable And on of one process, move we more when onboard is that then

for focus that’s area a so big us. And

to that or is the implemented early right have of Our QX end target at QX.

We supply our working help to market we’re that’s bit. a hard a tight think on particularly so that. And And relevant in operating that’s like going in we’re today. quite candidate

account is, in an basis. today, In at that probably And rates Which lost client I heavy prepared of points alluded clients running the PeopleReady. apples about XX terms out of XX year-over-year terms comment users when growth to year-over-year in at XX% apples – been higher on is revenue new biggest to and that take we’re strategies, clients of focus look something have are comparison, points and are a roughly at other you heavy what you clients out on our one seeing those that take XX JobStack. you roughly for of my is to users

of So at the in terms negatives. in running they’re the clients our XXs rest the running are and growth in rate of

a focus so of more clients for convert XXXX more non-users area become users. to to is big that are and beyond us in heavy JobStack And

would that weaker even have QX, user couple created of of results for lift actually without a in stack. been our us, heavy points the So

other client users that seeing thing among we’re among is we’re heavy seeing clients. those The retention those significantly higher

year-over-year coupled double growth And a of focus that higher with of pretty retention for higher us. so area an that’s rates obvious on the basis it benefit having rates, becomes

users. engagement client effort onboarding And to part back XXXX, so JobStack new client the team what sales we’ve done organization put usage. field XXXX. And more We we’ve plans engagement a towards heavy that half in changed team of our heavy and those clients. – comp drive marketing of a specifically is for big launched in more in user We’ve

with signed And sure so and we’ve as them been they clients, start a making up. we’ve good do working the JobStack to not get onboarding hard of fully aware they’re capabilities of we’re get off only PeopleReady, been but that to

user suspect and rates pretty healthy continue We’ll future in on goes we’re clients. the year I so, climb. to see year-over-year some as growth the of even And continue among percentage to see that those going revenue years to heavy

in a lot money We’ve area. JobStack. And of a so that’s big invested

that’s deal technology onboarding of some about we with the a earlier. for talked us So coupled big

Josh Vogel

XXXX? it. you. net still achieve missed expecting annualized to in helpful. $X are if you savings cost I a apologize That’s million But Thank I in Again,

Derrek Gafford

Hi, Josh. Yes. for Thanks the question.

will So carry as savings that that from XXXX. were into the some QX, on cost we savings went restructuring of far savings that as $X the are out that we that and the of the generated did PeopleReady of expecting action we million in activities organization through

Josh Vogel

you. point be if how I’m more down And then outside managing – cost $X this Thank of see structure step if at Okay. we you million. pronounced some just dynamic what could curious or the in that unexpected year. a still

Derrek Gafford

into the carved we XXXX, $X talked carrying expense. XXXX. out we that’s million Sure. of In about million operating $XX Well,

here through are. track being go some record the on and we’ve based So I where to think SG&A we got able rightsize and

down selling we’ve more about it careful very every what serving and trying step actions cost that is been It with or employees to clients. harder. some reductions the involving carry directly are really get reduction does this point to And harder gets However, of our any risk. in avoid up being cost efforts to

PeopleReady, is really we’ve we’ve outside I in branch and tried network do to of those very the pressure. had successful been at that we’ve which so where think the most And

Will I’m mean much in take So able When down, same degree, in rate we’ll take the almost out. not to some another were as more as I to down rate to revenue? our costs we the sure. the I to say it be that drop be same revenue. revenue, expenses step

carry make areas but to some know don’t keep a things might we’d able down if be that one-to-one turned if respond We’ll and risk. I more. we could progress go match have So little certainly other to into a that, for additional we’d

Josh Vogel

Thank you.

Just your PeopleReady one Outside at incremental you note looking one, improvements at of PeopleManagement. last of outlook. and PeopleScout,

we should as other no related headwinds or or expect client PeopleReady there’s today can itemiser at you say of So PeopleManagement? that

Patrick Beharelle

it’s provided XXXX. XXXX in company outlook, one the reported got in headwind client in continuing we No. What we’ve was that that we’ve creating our for and on just XXXX

we out. big on we there’s win need out. horizon that’s any the loss that but or we and broken we’ve Certainly to lose that feel client we anything So clients, not call like clients

that we’d at exist were you let there time. like this But all if that, doesn’t know. something So

Josh Vogel

All right. questions my for Thank Thanks you. guys. taking

Patrick Beharelle

Josh. Thanks,

Operator

over call to closing Instructions] [Operator back will Patrick remarks. now Beharelle I for the turn

Patrick Beharelle

listening to everyone. Well, chatting quarter to appreciate call. our earnings I We great thank forward Thanks. a fourth look quarter. you, you everyone. week, have And in next again

Operator

call. gentlemen, participating. for and today’s concludes this Thank you conference Ladies

You disconnect. may now

TrueBlue (TBI) 5 Feb 202019 Q4 Earnings call transcript