CBZ - Earnings call transcript Q1 2018

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Operator

Good morning, and welcome to the CBIZ First Quarter 2018 Results Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Lori Novickis, Director of Corporate Relations. Please go ahead.

Lori Novickis

Thank you, Debbie. thank XXXX joining Results and CBIZ for everyone, Quarter First Conference morning, you us for the Good Call. website, Relations In press connection of Investor release today's our page has been with posted on this www.cbiz.com. call, the This call webcast. also is being webcast And well replay on website. as found as a be the also the to our link live can

in measures. during management may found discuss we presentation, would financial we can call, Before the of like to measures non-GAAP today's the financial A of begin our remind reconciliation these you press that tables certain be release.

also Finally, management expectations forward-looking that and are performance. remember statements this based of current may do management's make and statements. future guarantee information Such not date on as

can certain assumptions materially. difficult Forward-looking differ the can the of statements A more and uncertainties Exchange detailed with filings risks, in risks Securities be involve found sometimes and can and Commission. and description Company's uncertainties do Actual that results such be to predict.

and President for today's call Jerry us Joining opening now Grisko turn for I remarks. over CEO; call Chief the to his Jerry Grisko, Financial Officer. will Jerry? and Ware are Grove,

Jerry Grisko

transaction high history optimism for results represent clients service from lines. high other total a are income Thank a point degree start a X.X% resulting period growth strong from of X.X% and by year earnings we These for from see demand our our pleased pretax among year and growth in of growth recent the to quarter climate, With organic the improvement a and results XXXX, morning, to XXX our acquisitions. strongest services a business XX.X%, strong reflect in number revenue basis report morning's results for margin revenue the release of a same first ago. we and pleased our oriented to our in of recent good results you, this Lori, numbers, our consulting of increase are XX.X% also on our per supplemented our and reported share favorable over of Within everyone.

expected December outreach place the to To we explain active changes of to revenue Act have portion we our of an in came passed the opportunity prospects. in impact in work related increase a this consulting effort our As last year. of tax the on capitalize, to in Tax Reform clients from our law

year. were year, completed a portion expect compliance quarter, the much additional tax in by throughout revenue be to we’ve the we concluded forthcoming that recognized be X.X%. the total to quarter XX.X% of was unit and financial we mid-April government our While, our now group core of revenue this of work required the Within services remainder first that that revenue work Same growing unit of business. consulting healthcare first same accounting strong was by in our both growth by in tax and revenue grew businesses with the

from revenue We our also X.X% Services, including transactional All services financial lines Services. our the our totaled, real Support and experienced Services Litigation growth service Advisory services strong results from to Tenant our Corporate non-core Recovery a our from approximately number revenue contributed estate these of group.

Recent the service from contribution revenue it acquisitions with pleased the difficult first these performing explained financial group service for we've we also in while lines the of within services quarter, in project remainder the so the be are within these to very past oriented, well. are project the results to similar As lines more tends is year.

market us Business the June that existing has in services Transaction integrated the to pleased one private This advisory consulting performance Advisors We with acquired leading the focused private equity of been business our middle Laurus of in financial XXXX. the make to of equity Transaction recently acquired was firms. are associates, CMF Advisory with of Denver-based providers business and

group. as Insurance continued pleased X.X% four revenue improvement and from growth group train and group report continuing of of The we and lines foreseeable such impact business to quarter the we were future. continue growth our of this these year. are grew continue same Turning revenue develop on group should the businesses our casualty insurance our All organic to several business for to by we investments past, within this we and executive insurance more growth our X.X%. first also steadily core revenue In in businesses encouraging. to and the the remainder within Benefits this life service search unit producers our Total within results also have the commented within improve within for to new our and see expect transactional to performed our We're well health group cause this positive to of group make and hire, lines. additional of our to which these property service and business, plan

given While within pleased quarter we the in these the were predict first any service from be results strong to tend the quarter revenue of to these see year. in services difficult lines to

these Financial So, our Ware to with Officer. comments, over me it Grove Chief turn let

Ware Grove

good everyone. Jerry. And you, morning Thank

us. First a start quarter good represents to XXXX for

X, plenty strategic both service will a Our by pursue million million and acquired of to at $XXX.X facility terms we there of in in continuing were favorable services. to on outstanding unused facility to million that business $XXX results client borrowing our amended is XXXX. credit years financing carry more acquisition and strengthen April acquisition capacity five first capabilities. With actively opportunities March XX, achieve our the this On capacity. program extend out April core approximately and we $XXX maturity additional We're to quarter strong our have

for needs, and generate operations finance conduct facility to this active year us cash of flow plenty capital acquisition repurchases. an expect capacity full and from provides to program share seasonal the out year, our working We positive this carry

for the continues of priority be to strategic acquisitions. first capital towards Our use

of both XX, year the on earnout closed first be the approximately payments periods. March remainder to including million approximately $XX million XXXX, $XX.X expected XXXX approximately first cost of in XXXX, of Share acquisitions We related $X.X minimal. are a was approximately payment During of and million approximately $XXX,XXX. XX,XXX earnouts in quarter acquisition quarter future year for for in quarter XXXX the the million this prior cash activity million $X.X purposes shares $XX used in XXXX repurchases repurchased approximately of we next of first during at in and in XXXX. the At XXXX

in share opportunistic of opportunities activity. repurchase of issued We acquisition But to a target carry more grants impact in in continue towards approach to repurchases shares repurchase dilutive shares an with to the using share price our to neutralize share become have other annual out have and new taken option active to an connection number identify transactions. primarily we to this volatility order

shares. million As a in reminder XXXX, we repurchased approximately last year X.X

shares XXXX. is $X.X at In cash for approximately million evaluate full approximately this or share We fully with will we million capital spending XX approximately the year end but our for our repurchases, of shares count opportunities share absent and year XX.X quarter, $X a full of further continue this million share the capital diluted any capital spending first we of are to year million. repurchase expectation year XXXX full used projecting year compared

and for and First estimate approximately million. be was the XXXX, $XX amortization quarter $X.X expense of and depreciation depreciation full million will amortization expense we year

of this at our Our And business. compared nature quarter XX quarter on of working continues the be the with stood end at days to to receivables at sales days days ago. year first XX capital, subject the of the year outstanding first end seasonal a

within which XX experience. Our is points was expense year the XX range the point normally basis at for bad of basis that debt first revenue, this to XX quarter we

reference of debt full for point the XX basis XXXX, bad points. was at a As year

we administrative are X.X% for variable XXXX for XX we on share with also The expenses first impact points a $X.XX. items X.X% of was compared positive for of first As improve improve for two recorded gain margin two year, a assets; pretax quarter expense, other mind related basis as there was the and in Eliminating year increase income were by encouraged non-recurring you the caused compensation time this quarter the we pretax the reminder, XX the by losses by this deferred incentive were the compensation first approximately gains approximately general our increases a expenses the million. related at a to in that sale. Hurricane and year. these business claim an disruptions revenue in ago. to in year interruption and successfully recorded impact year, by a this In quarter first bear ago results consider the XX of early of that compared or settled an on a items impact EPS, plan year our year that year. first one-time very approximately income quarter quarter that Irma. by of results administrative quarter in this this first $X.X helped strong accounting each points with result basis and first a quarter results benefit to Over the We earnings goal in And is to per accounts recorded in increased as margin strong that very general insurance book the

accounting of the can impact Bear on The of our in recognition revenue causes greater quarter. and considering stock number variances to rate. been new impact effective for first over price XXXX. impact mind, exercised. our realized in compensation reform January tax this first can was want streams of the a volatile tax accounting XX.X% XXXX about and of share to the year quarter activity have The with activity the anticipated in the are rate, this of exercise of the quarter the compared balance a year when new ago. be increase the that that CBIZ be first of by new the not expected at the exercise revenue be XXXX minimal of standards. per expected There to implemented and also the options this a tax option attributable factors in so thinking share. benefit XX.X%, option than accounting by quarter the when $X.XX the implemented unpredictable, the timing will note was tax approximately anticipate impacted this quarter accounting that impact in rate be standard are in full price the rate standard the depending majority tax first favorable full impact and is share effective XXXX, far in But the XX%. We was year first year cause after-tax to approximately the year quarter of effective second effective year And impact is the I

in But forma and the summary the explanation our more first casualty a required revenue within detailed to we and XX-Q related approximately serve when several with will along issue that's much effectively primarily find You standard property pro accelerate business. days. our of quarter accounting impact $XXX,XXX revenue financial new to in disclosures of

saying business for I conclude outlook conditions So continue the favorable will to positive by XXXX. balance of very and is be our

quarter our range of over X% full To following. the of year reiterate Total early stage the growth were year XXXX the the year First solid. is to includes however, expected X% for last for full results XXXX. at this very a year, outlook revenue within

we shares. expect year year XX of approximately and count million tax approximately XXXX a will expect share be fully We diluted rate a full full effective XX%

for XXXX the We XXXX. with range a to expect for compared earnings XX% grow the reported when per of within XX% reported GAAP full year to $X.XX share

impact earnings one-time was in the the $X.XX. eliminating tax Now share adjusted of XXXX, per reform

an for XXXX. XX% with earnings of we XXXX within $X.XX increase a compared share per XX% to expect adjusted when in range So the

comments, I'll Jerry. conclude turn back it those and with over So to

Jerry Grisko

on to a touch like to take I'd Ware. you, acquisitions. moment Thank

are the As our capacity us the facility program. with $XX and annualized to Ware our capacity strong $XXX end revenue. the we strategic to unused million sheet flexibility mentioned, the closed on In four continue our first our This with transactions million to balance XXXX of we expected acquisition at unsecured provides of that have approximately quarter. borrowing approximately $XXX contribute and remains million credit

and are XXXX. we've And continue revenue. to closed five of in would transactions expected of million a at expect year, acquisitions three this another of stages annualized additional $X.X various prospects two close So have a far to pipeline that contribute total to our number during to of we

non-recurring results the that first is recognition over of advisory in changes to results complex to for of it quarter internally As to continue benefited difficult laws of help this favorable, in them we our significant results will changes one-time In for that a throughout too very us and services a much in we very into opportunities us our the our understand certain XX first climate recent from year a The and their consulting clients is these prospects high and place with and revenue clients actually tax and month of the early year. to translate provide nature consulting the that to us period, very to any how provide the among said, on opportunities with it with impact measure revenue year. all small have quarter. clients the quarter, of plan With strong our meet our make of the discussing that of market items number middle businesses. and to are predict business we the given predict is the factors remainder in optimism we're indicates

our revisit second confirming this that end at of point, this on At quarter. original at outlook turn guidance comments. we it to over As we are a our and guidance I'd like the will for time the result,

Operator

begin session. question now Instructions] The will the first comes question-and-answer [Operator Chris with Securities. We CJS Moore from

Chris Moore

that my I the that know revenue Hey, could to respect has you to Thanks conference that number just of of X% Cuts higher and just the terms that to good just between X%, follow of up QX level questions. for kind morning. is guess strong we some spectrum that the about revenue, some end to QX revenue that's the QX? say occurring going start Tax Maybe towards after of fact hard in the the I of kind with the gone predict. fair was given Jobs it the guidance. stuff talked in to taking with

Jerry Grisko

in talk call. Act the us changes revenue get that Yes, on before clients say extent organizational the ability is about on clients need to revenue, our just Chris. on encouraging our non-recurring Tax those in not to and then yet mean. about first to of Hi, prospects, our what translate with been And engaged getting will is that it’s some of it's Reform to that discussions. much that them with the And how that and the were help things into clients the the changes looked I uncertain we've both Jerry. some the we're because what fullest with quarter, talked of at nature and engage ultimately front we We very of What’s the discussions of having other yet things. these to them will

guidance So as wait really on in, we of we and beginning the our at second second comes we'll revisit revenue sit position And of here the we're to the year. today, see end we're that still comfortable put quarter. quarter going the with in at how that the the guidance out to

Chris Moore

talk growth, a this in little little a additional With success? respect accelerated thanks. further some to initiatives gauge before you to are of about you, order the that Can position the the and how that stimulate you and Got spending long during to with further a you bit. on in year them touched bit

Jerry Grisko

investment talked little in in been going some still doing working That And on is investment process are to here to and made Those about look insurance then as made challenge of caused in opportunities the planning benefits timing we're the we've was group. lot prioritize that business. investments And the at bit what it until those of wasn’t dollars been you'll and of takes use within tax help lines the law year. always business. time in of putting investments a we those of of investments opportunities we have a the producers services certain service of the side – that So we those in we little of have financial little presented things. of did – the step finalized a recall accelerate was we've have those bit a areas the December and and and that made, because growth on the a back talent last pipeline we're that

we We be marketing in half a are will year. – of and the branding the that from implemented exploring perspective believe some opportunities to second

return there immediate see but think not and investment the them some remainder the these more you are investments been when for that do of they impact, So return, to made year business. that time investments see over that are typically be the as have will of made, the the health will we that have throughout long-term right of you the an nonetheless are of

so opportunity And the those excited to about investments. make we're

Chris Moore

Got you. Thank you.

up one were care or a of of on can the the bit drivers health about talk mostly services that kind on question the gross Just little last year-over-year, services the you margins strong in pretty is financial side terms there?

Ware Grove

This Grove. good Yes, Ware observation. hi, is Hey, Chris.

I a and think tends the part compliance tax for in early the that area. the higher kinds And from government other had test us year, business and the healthcare stronger in of tax consulting growth we be services, to compared the aside consulting. of to margin

good a a very about are So of in of the initiative the stages at talked early We've that that. we driver. kind was past and pricing

some we're and So early seeing on helpful. returns that that's

So that part here in the of the assisted those us the a early are couple year. in of things margin

Chris Moore

All helpful. in guys. let jump Thanks it, right, back line. me Got

Jerry Grisko

Thanks, Chris.

Operator

Grisko I’ll no conference time, there closing questions this for back queue. any the are more in At to turn Instructions] [Operator remarks. the Jerry over

Jerry Grisko

again great quarter day. after you work Thank reflection speaking these have to we we hard to and forward members start thank analyst We a take also you, our you. and to report a our clients support exceptional Debbie. an and congratulate and for you your thank year. for to this and our thank your Okay, investors like team results. a second dedication like our our Results of moment At the point, with are just to their I'd to look

Operator

now today's you concluded. has conference for Thank The presentation. attending

may You disconnect. now

CBIZ (CBZ) 26 Apr 182018 Q1 Earnings call transcript