EXPO - Earnings call transcript Q2 2019

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Operator

Good day, and welcome to the Exponent’s Second Quarter of Fiscal 2019 Earnings Call. Today's conference is being recorded.

At this time, I would like to turn the conference over to Ms. Whitney Kukulka, Investor Relations. Please go ahead ma’am.

Whitney Kukulka

operator. you, Thank and ladies Good gentlemen. afternoon, Thank you XXXX Exponent's quarter us results joining conference on financial call. second for Please note corporate that on this call will be Relations of www.exponent.com/investors. the simultaneously section the at Company's website Investor be webcast

conference other is or is any written without reproduction property Exponent expressly of This and call taping prior prohibited consent. the

Officer; Financial the Executive Vice Schlenker, call on Catherine Officer. me Rich are Dr. Corrigan, and and Chief President Joining today and Chief Executive President

contains forward-looking you future Before discussion differ we here. risks discussed that like to may limited to remind I financial that from actual cause involve and including start, the statements, Exponent's would to that and opportunities not uncertainties those materially results but following market results

found in periodic including could under caption factors filings, that the Exponent's discussed actual those information XX-Q. Factor recent differ Form cause most be in from Exponent's Risk to SEC Additional can results forward-looking statements

obligation as them, new current otherwise. statements and Exponent forward-looking based are developments The on no update risks call and of result of today conference as a this to or expectations or in assumes whether revise

Catherine And Dr. call turn Chief Executive the over to Catherine? now Officer. I'll Corrigan,

Catherine Corrigan

performance. Thank more will XXXX, you, good I quarter everyone. start then today we will and then Whitney, and for by our second our provide call afternoon, off a financial of questions. detailed discussing for review will results and Rich expectations the open

trends. with will a with from in growth we the margin and expectation quarter to revenue expansion. result our quarter second out-performance pleased full-year market double-digit our are increasing that combined that a to outlook am of positive we benefit strong report Exponent for delivered I the continue our as

year-over-year last and user and quarter growth Exponent the despite a delivered concluded the large income net to facing due year. net XX% EBITDA third comparison in year-over-year growth study, which XX% revenue challenging

well we industries, success are and long we growth growth the profitability believe record results our revenue sustainable Exponent of track to to executing and we deliver has positioned geographies. on and are that are across over strategies practices evidence Our a long-term. drive

increase an and demand utilities and consulting as assessments During safety in engineering for as in large projects. management integrity for construction the saw quarter electrical international capital we well

part evaluate our risks infrastructure of and been integrity help mitigate Pacific has Electric, to Gas and As Exponent for to the of wildfires. retained with customers related and communities work safety

approximately the anticipate In Similar continue We these aggregate, to challenges work world. to but over revenues management States. this exist limited not will or down quarter. and additional western step of the United contributed projects in utility will second Infrastructure companies concerns around in they the integrity are wildfire time. X%

Exponent is from increasingly These engaged This engineering an in to designed municipalities to companies modernize infrastructure. mitigating range and over for market opportunity long-term. the which exciting construction transportation Exponent projects, systems complex utility presents risks aging large reviving mass international consulting system. involve projects

We and as new of continue existing factors between relationships Exponent expand the humans and the the and to our data both clients breadth human and to describing understand products. product to collect help studies look

in experiences sophistication to dramatically seek of are product volume to more the as on inform the we systems Clients humans Systems rely the to can is technology today and on home at becoming while create complex and workplace our data data through power and exceptional data clients they access move, the seek and unprecedented. these for of unlock development.

technologies. across user use our opportunities practice large us last reach of of involving set The humans our study interactivity human broad expand a on capitalizing and year, to led new factors by our success the cases. enabled between are We

portion portfolio of year's revenue existing both While we studies new project we a have scale not do scale, a smaller last and individual with an have replaced study for currently clients. of of that from significant

products more source battery of continues More in today are also expertise a be to for powered. technologies battery Our and strength Exponent.

and a batteries Exponent products, including present in assessments. electronics, become As our a lives failure management events, is vehicles, are in ubiquitous retained thermal practices, runaway battery manufacturing and consumer variety of lithium devices. result battery reviews, system analyses, medical design best ion have daily for

company's segments Exponent’s in scientific approximately engineering, Net represented grew to approximately XX% the and XX% other of net quarter second as compared in the quarter segment this year. revenues. revenues last

human and solutions grow construction performances more For complex had our quarter thermal products noteworthy consulting liquified safer wearable clients systems, and as provide These systems. went electronics engineering for gas from and from from are engineering, practices. more to to range segment range sciences, interdisciplinary The automated vehicles, mechanical electric devices sciences, how the The technology this facilities. structural what we to reliable. continues wrong to its in natural from to utility factors, biomedical make cardiovascular to engineering, demand deploying scooters and electric material Exponent’s answers

the quarter the health net X% and Exponent’s and regulation chemical environmental segment segment, as as impact Within on this human and practices scientists clients last continue health grow environmental safety, to to represented of revenues food Exponent's revenues. sciences this sciences quarter second the company's environmental segment the and grew approximately XX% chemicals approximately compared and advised products. of in health year. industry-leading in new Net

evolving client of and to team unmatched quickly scientists Our needs. allows engineers adapt us to

today address to and from challenging that our our are positioned universities continuously students most tomorrow. ensure are developing the to recruiting We existing staff the and issues clients' best top doctoral we

We and continue expert our and to advice, products to unparalleled systems. provide environmentally deliver healthier, sustainable enabling clients safer, them with

financial provide will review our a and business detailed now Rich of outlook. more performance

Rich Schlenker

Thanks Catherine.

specified. off me all unless a saying on Let be by start comparisons that otherwise will basis year-over-year

March Total revenues were before will refer For or on, I million. quarter. revenues as This the revenues, time revenues first here to delivered million in were them were a $XXX.X the from second has revenues million. XXXX up of net reimbursements, $XXX.X And single net XX%. Exponent quarter of $XXX

from the large discussed, our based. a X% was headwind the factors As in were offset We to X% develop XXXX. human portfolio has broad which able Catherine strength of study projects of

revenues size studies work The of third quarter. the related in of was for quarter. at net portfolio the to infrastructure in our of the their PG&E management and expect integrity We approximately to wildfires same approximately be X% electric

for work expect We and time. the over slightly gradually in lower the at third quarter down same or then PG&E continue step level, this to

Net last compared to was million or million, EBITDA per $XX share. year. Net second in and ago. $XX.X diluted $X.XX as year was income $XX.X compared XX% million to diluted income increased as the up or $XX million, one quarter from per share, $X.XX EBITDA

XXXX of half were $XX.X revenues XX% to million as share XXXX also earnings $X.XX, diluted per diluted X% to to And $XXX.X income net $X.XX of to For first the million compared and X% increased the increased first million. in Net increased revenues million. total $XX.X share. $XXX.X per and half

awards half In as share last year. was associated million of per tax diluted accounting share for $X.X with benefit the to first share-based or per compared $X.X million $X.XX XXXX, or diluted the $X.XX

million, XXXX, first EBITDA to $XX.X as X% increased compared the million. half $XX.X For of to

For billable to XXX,XXX. the to XXX,XXX. increased X.X% second hours quarter, hours increased Year-to-date, billable X.X%

XX.X% second XX.X%, is the utilization year. from up The last same in was quarter’s quarter which

the from half down year-to-date year, utilization For in first user study in the XXXX. last result points of project a large XX.X%, is decline the of XX.X% the conclusion of utilization two The year. was percentage

second due and a to managers four a the vacations expect five the year-over-year holidays and from summer, our additional percentage difficult comparison. in to meeting we quarter, third during the quarter point utilization decline For biannual

down step an quarter, sequentially five additional fourth the points. utilization For will

The net utilization which XX% increase fourth we impact to additional year. basis XX%, basis the quarter the will and full and utilization full points for week, the This week week a approximately for For and XXX week one by expect the XXXX, and include be fourth the Year's which which year be an fourth the to quarter holiday large the quarter X% and of quarter. year revenues the New vacations, extra the project additional will reduce percent includes XXXX associated XXrd will by in XX points. by will a for

long-term our equivalent increase XXX, grow as we year-over-year. to in full quarter in our the employees time X% expect to build continue critical mass practices and offices more up services. Technical We and were proactive utilization

the of growth X% year. We expect approximately quarter the for remainder be headcount sequential per to

rate X% quarter. The for increase was realized approximately the

X% the XXXX, expect of realized to the For X%. remainder be to increase rate we year-over-year

points revenue. For XX of XX.X% the second basis quarter, EBITDA net margin to increased

EBITDA half, XX.X%. points to XX first increased the For basis margin

full to related XX anticipated down be XX the basis EBITDA last to to XXXX, year to points expected year. the compared margin is variants For and utilization

of after for and is $X a compared a expense the adjusting as deferred XX%, losses included compensation gains to compensation million quarter, grew compensation gain the total in second of XXXX. million in of deferred $X.X compensation gain For expense in quarter in

deferred miscellaneous offset reminder, are on have line. and and compensation a bottom As no losses income gains impact in the in

last million million compensation compared expense the was $X.X Stock-based $X as in year. quarter to

in expenses million depreciation based For to quarter in XXXX, to expect increased the remaining expenses each the Other million stock is million of $X operating quarters. compensation X% in included $X.X of be other million. operating $X.X $X.X to second expense we

For other activities to and is remainder million the increase $X.X quarter. of we the the of quarter. quarter. $X.X to primarily million the be related to This higher XXXX, million in XX% recruiting $X.X to expenses of expenses operating level G&A in during range increased in marketing expect per an second spending

as rate XXXX, to of per consolidated meeting to XX.X% compared $X.X of the for period of to end in in our same G&A which related the million managers expenses to remainder XX.X% includes biannual was the Exponent’s million last quarter expected range expenses the are For tax $X quarter, the at be year. September.

year half tax For XX.X% as for a rate Exponent’s benefit was share-based ago. compared of the awards the the inclusive XX.X% first tax of year, to consolidated

XX.X% We tax full expect approximately be of for XXXX rate to tax to remainder our XX%. approximately our be the rate consolidated and year

cash quarter. expenditures was flows. were Capital flow million million $XX $X quarter. for for Moving our the to cash the Operating

We investments. the $XXX.X dividend in expect in to million million new equivalents to Year-to-date, $X the we with building as approximately million we complete in CapEx distributed million CapEx approximately payments million $XX short-term shareholders close return in and through should $XX.X be cash in Boston. period XXXX. $X cash, to to XXXX,

PG&E to the And dividends. the million quarterly of we to to accounts remaining receivable have been $X.XX be the announced of Approximately pay paid. $X believe substantially that and will quarterly paid. our continue continues end at dividend of receivables accounts intent all bankruptcy Today, reiterated half of payment our Exponent

and increasing our expectations EBITDA revenue second year results Due and momentum are strong margin. to the across for quarter full business, we our positive

We and in reimbursements expect a from as before to high-single challenging be continue digits project to compared points comparison We points XXXX. year-over-year the the of XX XX the the grow of basis conclusion margin third basis in XXXX. to to quarter to EBITDA face revenues now large down

now back for will call remarks. Catherine to turn I closing the

Catherine Corrigan

issues. reliability set by complex solutions range for a engaged teams is Exponent safety, interdisciplinary our health, on environmental who of Rich. and broad to call a diverse across to clients Thanks, increasingly continue challenges of

We our strengthen continue intelligence, thought leadership. development through market industry and to teams capability

unique business model and Our position. shape adaptable Exponent’s market capabilities

an Our valuable are reputation firm. to our and as industry solutions our opportunities new clients confident in create model to deliver leader for we and ability validates our

We call will questions. now open the Operator? to

Operator

Thank first our with [Operator question we’ll SunTrust. Tobey Instructions] you. Sommer And today take from

Joseph Thompson

you is My And China any Joseph on with this impacting you the evening. your great. is Thompson question on color around would be have uncertainty Tobey Sommer for what clients from line Thank how Hi, you’re business? trade my first taking you. this question. Thank seen hearing for proactive

Catherine Corrigan

Yes.

clients historically, movement manufacturing are in is manufacturing, that have supply example, opportunity say found do things work uncertainty And clients. consumer industry that we where the like felt assessments China those that. part that. Particularly business no tariff was from we attribute where There’s reliability let’s something represents of the to of tariffs manufacturing, we to really certainly, they’re their electronics of our that. bring any that, movement any lot whom a would for or and thanks say, to us our about we far, a I and for have the generally not of have issues. chain. standpoint like doubt particular in that because quality, our for supplier that a the So impact that important sourcing Thus their we would business supply – of – chains for around

seen haven’t with are looking conversation particular we our and opportunities find clients, but can present be So themselves this. to a in that as a result impact, certainly we’ll of

Joseph Thompson

color. additional that for you Thank

Looking you. teams’ Thank on industry of the on side at share? the – market client terms work business, the you have in proactive of keeping seen impact the topic proactive what

Catherine Corrigan

Yes.

are trying So great focused client. is side. focused working question. on framework teams multiple where to really are an on That proactive on we we we’re that are opportunities up a capabilities industry where These within – sell individual setting

where different where this, in a industries stages we’re are across I’m new good a work – one very into examples time able different we particular is type we’re in some effort. at So we’ve area. that of terms what client seeing the of seeing I’m when working to for of I And the client on been different in look expand pleased doing industries. It’s some a a

about the that’s when human to one of kind transportation focus, we’re being do. work talk which I I’m being I’m example, initiative. industry a utility – being And this I trying for clients client battery brought really a by side. work factors driven that’s is at that’s seeing to driven into think what time really seeing our

to we side, we are what really really need I is to the I’m what that we’re proactive that growth client think And so value. do support our as in development, helping of on our order the to client-centered I to seeing, be the well on believe doing capability And both – focus what in we as management curve based our offering staying are a ahead clients that, of terms that have in services. of approach

think mature went where area an down, industries, since an really electronics hasn’t work, our doing in gas the maybe more of the transportation. that and I really price Oil and of seen is oil uptick. take much it’s proactive more

successes out So we’re think of a there. different to variation absolutely I client industries. capabilities of across within seeing there those examples is But those get relationships sort those

Joseph Thompson

Thank you.

Catherine Corrigan

welcome. You’re

Operator

from hear with we’ll Foresi Next Fitzgerald. Cantor Joseph

Drew Kootman

on Joe. is wanted for Drew just the on This utilization. to Hi. Kootman I touch

uptick, about especially last to is pretty talked guys quarter. compared which you a for think strong quarter, the I XX.X%

just what quarter. quarters? guys decline such over curious And the why a next there So saw the for then two you

Rich Schlenker

we user utilization was the was improvement second second through as utilization and that our Yes. to at Yes, quarter. our a work of the in end the the saw in were We – to additional first of that I not really growing Electric the XX.X% quarter work in definitely had Pacific wildfire few overall in good in discussed is only and activity our here benefit responding but seen both system The study piece proactive we rising to quarter an It the areas. portfolio beginning moving One improvement. as improving quarter staff a continued focus incident, her think helped utilization. pickup. Gas nice quarter. into a in of on showed in as and the reactive. that X% Catherine management activities some of the the for and in integrity to clearly we first revenues was We in that gradual up as well, indicated But saw it fill and

stronger on quarter, range a let’s portfolio international the of the into our little in a tend activity had of product million just But again $X.X several bit of of ones matters level activity fits cases, projects. that of matters arbitration large to million quarters. in than was are those seen we those we So, $X.X had cases liability – good activity to between, number maybe and say,

$X.X step strong, into robust activities. of level not cliff, as those at planned number were those Nothing sort we on maybe falling we still So larger going that know quarter. we move third ones down $X.X off as that activity is to million to but on are to but We were lower of million, quite those some we’ll think a in be be of projects. a the as a definitely

looked the utilization X of meeting, we into our will of forecasts quarter, practices, percentage do this strong third definitely in each which activity We the point have summertime. by quarter. got as level So is probably the the impact for vacation from managers

you when look holidays we that number off probably the about days that you XX%. would to and of typical expect XX.X% if at are did That’s be So taken. vacations, just

be that sort meeting that a it, we’ll managers puts We’re in this, activity that of of into little little and that would into level percentage XX%, X.X areas anticipating below a bit a call X quarter. be to points that. approximately few lower activity The lower us

it quarter So the the year’s third last guidance that at and little only strong of people provided really quarter, and remember, strong. way but Even bit our the were factors if around project August, that we though trend human that the from we momentum every continued that’s through year, large last that – was that’s who project, what a not came off why off looking very third second that quarter all we’re September. in down there

so And at were the activities strong very that time.

very So encouraged we’re still business. the about

we vacations, managers And of in. just such, that We’re of and bringing recruiting a holidays, such. in the be set see it’ll as primarily meeting bit coming strong a still lower and little because headcount

Drew Kootman

cadence you for sequential you. for – same assuming Thank the – I at could apply margins then on revenue probably does extra we touch is as if I’m then QX Got both decline forward? a that week the then on And know it. revenues? like and strongest that And and given and thing margins?

Rich Schlenker

Yes.

the we’re in to by So revenue third you people, in in follow That you in that quarter a X% when third – really the quarter increase from headcount. the how a step-down to utilization. step puts will but to X% We’ll with X% really the end second X% expect you more a the which few that. as utilization, adjust a step-down offset more move down X% quarter up that, revenues, by in step-down for through in maybe to is you’d offset really

of that of the it, again on the down there. you as let’s play in call move quarter X% would through the thing number utilization you revenues because if weeks, step that that would it – was step-down expected that, again, we you the into fourth to other have as is into X% quarter, that, go The same in – to

week through X% by there. the that extra That plays will getting revenue we’re additional partially from that the be offset

growth provide to instead primarily higher that ought are the So be something and offset that to at you looking is of things be you’re those will able push looking will that that through the a a into in fourth quarter. the third quarter. low on high revenues for that would Obviously, basis a year-over-year growth double-digit single-digit say in you the in put let’s the – year-over-year

far very the utilization in look, third As go, strong quarter. last a as margins we had year

look points range as margins margins, to down impact The here the be such. to fourth the in X X We’re going impact a utilization talking will in about extra and to percentage third an that there to you points there related week That’s that. basis that let’s it, call XXX that’s discussed I quarter, quarter. of at the below year-over-year

would we fourth at expect a again, as be on you looking as a So basis year-over-year But basis step-down might in That year-over-year hopefully be that margins direction. XX quarter look basis a in that the and guidance might to as the to XX down range you forward. be better some on point we year-over-year well basis. on gives

Drew Kootman

you. Perfect. Thank

Operator

McHugh Tim from hear with William Blair. now We’ll

Tim McHugh

Thanks.

years on want of now? Just there’s probably of of is from assessing to much And to they the want initially be work. how is longevity follow extent to versus level an ongoing understand three it. the on the the guess, probably So activity activity infrastructure? is I the type incident from every for of I nature potential suspect activity safety utility up of the kind Can two what now, obviously, more that year where what’s I of of a this – heightened what To it elaborate you, kind the need guess we’re I PG&E of work? potential the response,

Catherine Corrigan

Yes.

is that the of of integrity the really which the a there the having is in system. is is the is there of there you’re the need But Tim, in even management immediate response. area that And certainly and that and if looking – electrical So that, a around is in are that, significant sort of – a is accounts late press at large that assets the proportion something challenges of what’s that incident there. component PG&E

the that I if there a that do sort seeing are mean of expect not we tail amount amount certainly a at we’re I we be will of activity look over only is time. there’s But be that we a acutely think there have level large there. certain will right? It now. – So a of at visibility, – we

we’ve activity portfolio I like things is projects. of what in it’s one often past of a once in amount seen is initially. But the happens what mean there that that large – a and this and

reasonable closes, This level time. those As of continue for it issue one that happens build new period will to to this that expectations step we’re and at going of of is a over questions or becomes own sort so It’s portfolio. sort projects raises not its down. into of us what certainly

next more client Looking But reasonable maybe slightly into and now. increase below of beyond that. difficult quarter, we that our are that activity baseline some do relationship that now, with with we becomes think in with see It be will of where where are them, there the to this because at I it’s level client.

Tim McHugh

seeing Okay. you That’s helpful. anything demand gave ask Is I the actually been that better execution a as color, internal you the environmental would different for Can we the higher-level that some was there? we’ve highlight about at environmental and there growth health? on side, while or environment know but look I rate a it

Catherine Corrigan

Yes, yes.

health couple that on environmental driving and of the things. is So a what’s side,

to fairly work So work. is proactive continues doing see that on this and the That So where we we work continuing are regulatory is right? chemical-related chemical-related, expand. steady industrial in growth regulatory are agricultural see the side, the to

for globally particular that. That’s us. saw steady significant We’re But look a the in across side, seeing across work I more environmental, look on health. been when we uptick I fairly fairly quarter, reactive around this

in that at litigation we’re activity portfolio and very – in activity, of that for of seeing hundred mentioned things health kind there’s terms that In of was size are earlier number a where sort this strong environmental is Rich quarter. that and there kind few the thousand have that the of been of

around marketplace those those are areas who I in more And traction certain areas think effects who on health. chemicals and folks the chemicals in in it of the human our are reflects of getting

the of – presentations And the – there are we conferences to at out are that position they reputation. our the in our marketplace, to is can improve building continuing giving folks hope these and continue are build so and

So that in sign. for business think terms the reactive positive the – on of a quarter. really change the I the increase it’s the take was the I side But in

Tim McHugh

Thank Okay, that’s you. helpful.

Catherine Corrigan

You’re welcome.

Operator

question. with Berenberg our has England next Sam

Sam England

Hi guys.

Just a for me. couple

The first second next looking million one, I capital into talked still was the position the whether cash to the thinking I cash given quarter. how over wondering that you’re about allocation get the down about where you’ve to, the half heading few to And you’re $XX historically level finished $XX years? think, the million

Rich Schlenker

Yes.

– don’t and have come I term, not Sam, long different So either. conclusion term to think nothing short in a changed, the definitely has we

to period that We on an of faster area than grow we that year-over-year – continue is the that, to would can earnings a increase feel and look time basis. We this some that. for to continue dividend we

basis activity the why in opportunistic, no The activity That’s count down. share essentially of repurchase here. that are that that really in did months more We a quarter. the opportunistic we year-over-year fourth late year, we’ve had We the repurchases. more saw our in six is first on being activities

to along. opportunities We those come they will as continue evaluate

and to need to about balance our those at work years, to long. we’ve million of of There’s a $XX that. let’s we have way term, to continue is $XX on that next that our tried above nice stock the But it prudent minimum say, that process about have, our and down to at, the that over we cash level continue in price, long we that we’ll based intent a been generate, been and repurchases. rise the can the target of have about it the going we the million talking we’ve four is to getting But be look, amount

some an looking But than in will where is organic It forward. can acquisition we that doesn’t identify the into that, we margins, fill mean we XXXX. not integrate that for Other and right of go these we firm opportunity since to again, and we’re areas. a of driving our expansion seed this acquisition firm focus the growth growth haven’t integrated that and of feed done as about need

Sam England

the that the this Right. Thanks. guidance I Do coming margin purely X%, just of to in And was any wage improvement of year. you’re will think year? that you’re it full the then terms the rate think, side? realized seeing Or inflation more for just is utilization the seeing one, from than of offset you second most X%

Rich Schlenker

compensation year little for is Revenues the our of half half X% the here first cost after primarily up The that even for a the time. rate six-month will more demonstrate – been our our offset had. year, with able to period were pricing adjusting We that and the increases for increases utilization is of have utilization coming from lower utilization the of that total we side. salary increases our do We've the expect deferred than compensation first up through X%.

XX%. in We the adjustment we this year cost Xst in grew compensation the at thing revenues implemented of after the the of quarter raises same level XX% that April with second at after saw and growing

their of the marketplace to perspective we're driven from people as that client in hopeful So, we increased as that the into well. also Clearly, a balance. is value value find our can continue employees

long find balance try that. that to to over and continue able do So them keep we term to expect aligned the to be and

Sam England

All guys. right. Thanks

Operator

question comes with Riddick next Marc Our Sidoti. from

Marc Riddick

to about worry be is something there's we down sort anything thinking of anything I have then little or of that? to if sort wanted I that was there. be any One, Thanks. within a a little my far get connecting could slow exclusivity growing as of I – bit as should you things of there's leading And of Hi, to we the the into spectrum, theme of couple or on question that broader sense it? like part second a more I part to human sort maybe of is good assignments. if should thinking there delve you wanted anything about far wanted as on be factors industry bit a about would that, that that's as a particular could growth And wondering the that that touch you verticals evening everyone. and

Rich Schlenker

Yes.

there maybe, So Catherine in. start can off and I’ll add

this into means entered we that arrangements that we products about our Exponent our of have not per in area. with have able find come is It's It's had of in in competitive to automotive we business. implied market industry. isn't consumer that has that why not we're design. a a It's We business doing the We concept them. in for business, working in works can't all any arrangements the over and a is the where or – We've for we contractual manufacturers a that, almost up consulting critical others company practice work client all been decades. – client for that or been a are believe work one

We helping them try design human studies, – to designs the data things in drive factors the and inform the gather information and to the that to gather clients for can their better into get and there information are processes future. that

understand. that one is to reasons conscious it you. they to it's So, of our been of us But people what has that we they're limit try we because coming of are look can the – make something sure to experiences

home those personal in and when related are that. vehicle move that's in just autonomous to our home react fully watch products semiautonomous do upon seeing that when and virtual itself. as we consumer how already you is What phone – we're are – of to technologies that have even what from now exponentially in devices have far or and in what as individuals into our we're physical absolutely we're how those seen that the the our seeing – our have interconnectivity our we work the in as and move That we have technologies and our the is What workplace. implemented it interacting in interactions? happen we we is vehicle we answering changing. interaction to We with all appliances and how to of I As interacting builds vehicles mean the in that with workplace. reality happens today individual everything being to is we element we questions growing growing both controls that to verbal, in –

So evolutionary. this is

things they humans into of We and are to today they building – upon automation, in go will especially we as address phase into react adaptive and how this that. be how studying the vehicles will different controls those

So, we infancy. is again in its still that this feel

that. upon building are We

We to to range automation from environment. things are questions reality gaming a in seeing that questions virtual in home are world, that the workplace activities the

So, we forward. hope to as look upon of those we build each

Catherine Corrigan

into medical transportation, I human gas. sell would that all client particular Marc relevant this electronics, seeing add to are that going is about lot goes us from the –the succeed the because across in really of of technology and this our that earlier. to The factors approach capability area it’s to in an of we that relevant standpoint allows little we in area really relationships talking back a go areas. mean is in relevant to it’s it changes we the applications that those have oil this to I that and the was of to is it’s I devices, the trust and client utilities that how sort alluding of focused – a bit Yes, to, Rich

recruit it levels people this place where So these really to �� staff industries. continue recruited then the really areas we are have creates us these fabulous really, for junior a in and the senior and that across opportunity also are both the at absolutely top a

look I exciting I when the think so, business, that particularly this across a And opportunity for is out us.

Marc Riddick

see an some that how things attractive like could acquisition for maybe out you’re global for areas you last you. you are to pipeline, update there, the at color. And how Thank looking geographies seeing or me, about evaluations if what maybe that. and Thank wanted get then thing great. you feel the just Okay, we I on

Catherine Corrigan

Yes, sure.

have So weeks the And we there. and over over global of standpoint see growth area of an engineering UK just visiting I from us. Europe in the with opportunities, couple seen of was for continue a interestingly to and as opportunity ago our team in

United is it to very of well over chemical the regulation arena Europe. starting it’s standpoint nearly traction in think the when infancy engineering, happen. We some I but in reputation that compare the recognition, in continue that to brand a our to I there is have brand known. But around its States, terms is not solid very – much And as of there from

that’s think very positive. So I

right Our but focus to absolutely focused firm engineering, the of engineering, kind of right very in at firm. now, we hiring size our the Europe were I around area, over able if would terms talent. in the also senior we think find take core in right on advantage that into integrate to we But are

in bring to that both looking senior to the been have talent in can activity. over that both UK junior try we at – elsewhere feed and in and We

but can book it reputation sort a someone client small you business. strong do also a it known the can is industry, if who by known field, You a of in and got has have their in do you acquisition, of

we those Europe. growing when of really both opportunities, engineering kinds to our we work look look So at in of

Marc Riddick

Great. you Thank very much.

Catherine Corrigan

You welcome. are

Operator

question-and-answer your today’s and participation. conclude Thank That that will for today’s session will call. conclude you

disconnect. You may now

Exponent (EXPO) 18 Jul 192019 Q2 Earnings call transcript