TACOMA, Wash.--(BUSINESS WIRE)--
TrueBlue, Inc. (NYSE:TBI) announced today its fiscal first quarter 2018
results.
Revenue was $554 million, a decrease of 2 percent, compared to revenue
of $568 million in the fiscal first quarter of 2017. Net income per
diluted share was $0.22, an increase of 100 percent, compared to $0.11
in the fiscal first quarter of 2017. Adjusted net income per diluted
share1 was $0.31, an increase of 48 percent, compared to
$0.21 in the fiscal first quarter of 2017.
“We are off to a strong start this year with earnings per share growth
of 100 percent,” TrueBlue CEO Steve Cooper said. “While revenue was down
modestly, growth in our PeopleScout business accelerated to over 20
percent, and we are taking the right actions to return the PeopleReady
business to growth. Programs to reduce the cost of services are working,
resulting in our ninth consecutive quarter of gross margin expansion and
a three percent increase in gross profit for the quarter.”
“We are making good progress with our digital strategy. Prospective
PeopleScout clients are excited about our new talent acquisition
technology, AffinixTM, and adoption of our PeopleReady mobile
staffing technology, JobStackTM, is increasing. We have the
right strategy to differentiate our services and position the business
for profitable long-term growth.”
TrueBlue also announced today the divestiture of PlaneTechs, a provider
of skilled mechanics and technicians to the aviation sector, which was
completed in March. PlaneTechs made up less than 2 percent of total
company revenue and the divestiture is not expected to have a meaningful
impact on operating income. The action will further enable the company
to focus on larger market, higher growth, and higher profit margin
opportunities.
2018 Outlook
The company estimates revenue for the fiscal second quarter of 2018 to
range from $585 million to $600 million. It also expects net income per
diluted share to range from $0.32 to $0.38. Adjusted net income per
diluted share is expected to range from $0.47 to $0.53.
Management will discuss fiscal first quarter 2018 results on a
webcast at 2 p.m. PT (5 p.m. ET), today, Monday, Apr. 30. The webcast
can be accessed on TrueBlue’s website: www.trueblue.com.
About TrueBlue:
TrueBlue (NYSE: TBI) is a leading provider of specialized workforce
solutions that help clients achieve business growth and improve
productivity, while connecting approximately 740,000 people with work in
2017. TrueBlue's PeopleReady segment offers industrial staffing
services, PeopleManagement offers contingent and productivity-based
on-site industrial staffing services, and PeopleScout offers Recruitment
Process Outsourcing (RPO) and Managed Service Provider (MSP) solutions
to a wide variety of industries. Learn more at www.trueblue.com.
1 See the financial statements accompanying the release and
the company’s website for more information on non-GAAP terms.
Forward-looking Statements
This document contains forward-looking statements relating to our plans
and expectations, all of which are subject to risks and uncertainties.
Such statements are based on management’s expectations and assumptions
as of the date of this release and involve many risks and uncertainties
that could cause actual results to differ materially from those
expressed or implied in our forward-looking statements including: (1)
national and global economic conditions, (2) our ability to attract and
retain customers, (3) our ability to maintain profit margins, (4) new
laws and regulations that could have a material effect on our operations
or financial results, (5) our ability to successfully complete and
integrate acquisitions (6) our ability to attract sufficient qualified
candidates and employees to meet the needs of our customers, (7) our
ability to successfully execute on new business strategies and
initiatives such as the consolidation of our service lines and
leveraging of mobile technology, and (8) uncertainty surrounding the
interpretation and application of the recent 2017 Tax Cuts and Jobs Act
and any reduction or change in tax credits we utilize, including the
Work Opportunity Tax Credit. Other information regarding factors that
could affect our results is included in our Securities Exchange
Commission (SEC) filings, including the company's most recent reports on
Forms 10-K and 10-Q, copies of which may be obtained by visiting our
website at www.trueblue.com
under the Investor Relations section or the SEC's website at www.sec.gov.
We assume no obligation to update or revise any forward-looking
statement, whether as a result of new information, future events, or
otherwise, except as required by law. Any other reference to future
financial estimates are included for informational purposes only and
subject to risk factors discussed in our most recent filings with the
SEC.
In addition, we use several non-GAAP financial measures when presenting
our financial results in this document. Please refer to the
reconciliations between our GAAP and non-GAAP financial measures in the
appendix to this document and on our website at www.trueblue.com
under the Investor Relations section for a complete perspective on both
current and historical periods. The presentation of these non-GAAP
financial measures is used to enhance the understanding of certain
aspects of our financial performance. It is not meant to be considered
in isolation, superior to, or as a substitute for the directly
comparable financial measures prepared in accordance with U.S. GAAP, and
may not be comparable to similarly titled measures of other companies.
|
|
|
TRUEBLUE, INC.
|
|
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
13 Weeks Ended
|
|
(in thousands, except per share data)
|
|
|
|
Apr 1, 2018
|
|
|
Apr 2, 2017
|
|
Revenue from services
|
|
|
|
$
|
554,388
|
|
|
$
|
568,244
|
|
Cost of services
|
|
|
|
|
411,120
|
|
|
|
428,815
|
|
Gross profit
|
|
|
|
|
143,268
|
|
|
|
139,429
|
|
Selling, general and administrative expense
|
|
|
|
|
125,763
|
|
|
|
121,844
|
|
Depreciation and amortization
|
|
|
|
|
10,090
|
|
|
|
11,174
|
|
Income from operations
|
|
|
|
|
7,415
|
|
|
|
6,411
|
|
Interest and other income (expense), net
|
|
|
|
|
2,204
|
|
|
|
74
|
|
Income before tax expense
|
|
|
|
|
9,619
|
|
|
|
6,485
|
|
Income tax expense
|
|
|
|
|
864
|
|
|
|
1,811
|
|
Net income
|
|
|
|
$
|
8,755
|
|
|
$
|
4,674
|
|
|
|
|
|
|
|
|
|
Net income per common share:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
$
|
0.22
|
|
|
$
|
0.11
|
|
Diluted
|
|
|
|
$
|
0.22
|
|
|
$
|
0.11
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
40,443
|
|
|
|
41,637
|
|
Diluted
|
|
|
|
|
40,694
|
|
|
|
41,937
|
|
|
|
|
|
|
|
|
|
|
|
TRUEBLUE, INC.
|
|
SUMMARY CONSOLIDATED BALANCE SHEETS
|
|
(Unaudited)
|
|
|
|
(in thousands)
|
|
|
|
Apr 1, 2018
|
|
|
Dec 31, 2017
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
26,636
|
|
|
$
|
28,780
|
|
Accounts receivable, net
|
|
|
|
|
322,388
|
|
|
|
374,273
|
|
Other current assets
|
|
|
|
|
29,806
|
|
|
|
25,226
|
|
Total current assets
|
|
|
|
|
378,830
|
|
|
|
428,279
|
|
Property and equipment, net
|
|
|
|
|
57,142
|
|
|
|
60,163
|
|
Restricted cash and investments
|
|
|
|
|
242,766
|
|
|
|
239,231
|
|
Goodwill and intangible assets, net
|
|
|
|
|
323,468
|
|
|
|
331,309
|
|
Other assets, net
|
|
|
|
|
51,745
|
|
|
|
50,049
|
|
Total assets
|
|
|
|
$
|
1,053,951
|
|
|
$
|
1,109,031
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
$
|
197,753
|
|
|
$
|
212,419
|
|
Long-term debt, less current portion
|
|
|
|
|
69,621
|
|
|
|
116,489
|
|
Other long-term liabilities
|
|
|
|
|
222,641
|
|
|
|
225,276
|
|
Total liabilities
|
|
|
|
|
490,015
|
|
|
|
554,184
|
|
Shareholders’ equity
|
|
|
|
|
563,936
|
|
|
|
554,847
|
|
Total liabilities and shareholders’ equity
|
|
|
|
$
|
1,053,951
|
|
|
$
|
1,109,031
|
|
|
|
|
|
|
|
|
|
|
|
TRUEBLUE, INC.
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(Unaudited)
|
|
|
|
|
|
|
13 Weeks Ended
|
|
(in thousands)
|
|
|
|
Apr 1, 2018
|
|
|
Apr 2, 2017
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
$
|
8,755
|
|
|
|
$
|
4,674
|
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
10,090
|
|
|
|
|
11,174
|
|
|
Provision for doubtful accounts
|
|
|
|
|
2,209
|
|
|
|
|
1,446
|
|
|
Stock-based compensation
|
|
|
|
|
3,409
|
|
|
|
|
3,304
|
|
|
Deferred income taxes
|
|
|
|
|
1,370
|
|
|
|
|
726
|
|
|
Other operating activities
|
|
|
|
|
(572
|
)
|
|
|
|
1,080
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
|
|
42,679
|
|
|
|
|
49,077
|
|
|
Income tax receivable
|
|
|
|
|
(2,842
|
)
|
|
|
|
9,565
|
|
|
Other assets
|
|
|
|
|
(1,964
|
)
|
|
|
|
3,627
|
|
|
Accounts payable and other accrued expenses
|
|
|
|
|
(4,878
|
)
|
|
|
|
(15,015
|
)
|
|
Accrued wages and benefits
|
|
|
|
|
(9,991
|
)
|
|
|
|
(16,071
|
)
|
|
Workers’ compensation claims reserve
|
|
|
|
|
(4,579
|
)
|
|
|
|
(1,957
|
)
|
|
Other liabilities
|
|
|
|
|
1,149
|
|
|
|
|
2,488
|
|
|
Net cash provided by operating activities
|
|
|
|
|
44,835
|
|
|
|
|
54,118
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
|
|
|
(1,911
|
)
|
|
|
|
(6,167
|
)
|
|
Divestiture of business
|
|
|
|
|
8,500
|
|
|
|
|
—
|
|
|
Purchases of restricted investments
|
|
|
|
|
(3,299
|
)
|
|
|
|
(14,975
|
)
|
|
Maturities of restricted investments
|
|
|
|
|
6,417
|
|
|
|
|
4,423
|
|
|
Net cash provided by (used in) investing activities
|
|
|
|
|
9,707
|
|
|
|
|
(16,719
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
Net proceeds from stock option exercises and employee stock purchase
plans
|
|
|
|
|
395
|
|
|
|
|
491
|
|
|
Common stock repurchases for taxes upon vesting of restricted stock
|
|
|
|
|
(2,086
|
)
|
|
|
|
(2,400
|
)
|
|
Net change in revolving credit facility
|
|
|
|
|
(46,301
|
)
|
|
|
|
(57,367
|
)
|
|
Payments on debt
|
|
|
|
|
(567
|
)
|
|
|
|
(567
|
)
|
|
Net cash used in financing activities
|
|
|
|
|
(48,559
|
)
|
|
|
|
(59,843
|
)
|
|
Effect of exchange rate changes on cash, cash equivalents and
restricted cash
|
|
|
|
|
(760
|
)
|
|
|
|
(339
|
)
|
|
Net change in cash, cash equivalents, and restricted cash
|
|
|
|
|
5,223
|
|
|
|
|
(22,783
|
)
|
|
Cash, cash equivalents and restricted cash, beginning of period
|
|
|
|
|
73,831
|
|
|
|
|
103,222
|
|
|
Cash, cash equivalents and restricted cash, end of period
|
|
|
|
$
|
79,054
|
|
|
|
$
|
80,439
|
|
|
|
|
|
|
|
|
|
TRUEBLUE, INC.
NON-GAAP FINANCIAL MEASURES AND NON-GAAP
RECONCILIATIONS
In addition to financial measures presented in accordance with U.S.
GAAP, we monitor certain non-GAAP key financial measures. The
presentation of these non-GAAP financial measures is used to enhance the
understanding of certain aspects of our financial performance. It is not
meant to be considered in isolation, superior to, or as a substitute for
the directly comparable financial measures prepared in accordance with
U.S. GAAP, and may not be comparable to similarly titled measures of
other companies.
|
Non-GAAP Measure
|
|
|
|
Definition
|
|
|
|
Purpose of Adjusted Measures
|
|
EBITDA and Adjusted EBITDA
|
|
|
|
EBITDA excludes from net income:
- interest and other income
(expense), net,
- income taxes, and
- depreciation and
amortization.
Adjusted EBITDA, further excludes:
- Work Opportunity Tax
Credit third-party processing fees, and
- cloud-based
software implementation costs.
|
|
|
|
- Enhances comparability on a consistent basis and provides
investors with useful insight into the underlying trends of the
business.
- Used by management to assess performance
and effectiveness of our business strategies.
-
Provides a measure, among others, used in the determination of
incentive compensation for management.
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income and Adjusted net income, per diluted
share
|
|
|
|
Net income and net income per diluted share, excluding:
-
gain on divestiture,
- amortization of intangibles of
acquired businesses, as well as accretion expense related to
acquisition earn-out,
- cloud-based software implementation
costs,
- tax effect of each adjustment to U.S. GAAP net
income, and
- adjusted income taxes to the expected effective
tax rate.
|
|
|
|
- Enhances comparability on a consistent basis and provides
investors with useful insight into the underlying trends of the
business.
- Used by management to assess performance
and effectiveness of our business strategies.
|
|
|
|
|
|
|
|
|
|
|
|
|
1. RECONCILIATION OF U.S. GAAP NET INCOME TO ADJUSTED NET INCOME
AND ADJUSTED NET INCOME, PER DILUTED SHARE
|
|
(Unaudited)
|
|
|
|
|
|
|
Q1 2018
|
|
|
Q1 2017
|
|
|
Q2 2018 Outlook*
|
|
|
|
|
13 Weeks Ended
|
|
|
13 Weeks Ended
|
|
|
13 Weeks Ended
|
|
(in thousands, except for per share data)
|
|
|
|
Apr 1, 2018
|
|
|
Apr 2, 2017
|
|
|
Jul 1, 2018
|
|
Net income
|
|
|
|
$
|
8,755
|
|
|
|
$
|
4,674
|
|
|
|
$ 12,900 — $ 15,400
|
|
Gain on divestiture (1)
|
|
|
|
|
(1,393
|
)
|
|
|
|
—
|
|
|
|
—
|
|
Amortization of intangible assets of acquired businesses (2)
|
|
|
|
|
5,221
|
|
|
|
|
5,864
|
|
|
|
5,100
|
|
Cloud-based software implementation costs (3)
|
|
|
|
|
1,715
|
|
|
|
|
—
|
|
|
|
2,200
|
|
Tax effect of adjustments to net income (4)
|
|
|
|
|
(887
|
)
|
|
|
|
(1,642
|
)
|
|
|
(1,200)
|
|
Adjustment of income taxes to normalized effective rate (5)
|
|
|
|
|
(675
|
)
|
|
|
|
(5
|
)
|
|
|
—
|
|
Adjusted net income
|
|
|
|
$
|
12,736
|
|
|
|
$
|
8,891
|
|
|
|
$ 19,000 — $ 21,500
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income, per diluted share
|
|
|
|
$
|
0.31
|
|
|
|
$
|
0.21
|
|
|
|
$ 0.47 — $ 0.53
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted average shares outstanding
|
|
|
|
|
40,694
|
|
|
|
|
41,937
|
|
|
|
40,700
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2. RECONCILIATION OF U.S. GAAP NET INCOME TO EBITDA AND ADJUSTED
EBITDA
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Q1 2018
|
|
|
Q1 2017
|
|
|
Q2 2018 Outlook*
|
|
|
|
|
13 Weeks Ended
|
|
|
13 Weeks Ended
|
|
|
13 Weeks Ended
|
|
(in thousands)
|
|
|
|
Apr 1, 2018
|
|
|
Apr 2, 2017
|
|
|
Jul 1, 2018
|
|
Net income
|
|
|
|
$
|
8,755
|
|
|
|
$
|
4,674
|
|
|
|
$ 12,900 — $ 15,400
|
|
Income tax expense
|
|
|
|
|
864
|
|
|
|
|
1,811
|
|
|
|
2,500 — 2,900
|
|
Interest and other income (expense), net
|
|
|
|
|
(2,204
|
)
|
|
|
|
(74
|
)
|
|
|
(400)
|
|
Depreciation and amortization
|
|
|
|
|
10,090
|
|
|
|
|
11,174
|
|
|
|
10,200
|
|
EBITDA
|
|
|
|
|
17,505
|
|
|
|
|
17,585
|
|
|
|
25,100 — 28,100
|
|
Work Opportunity Tax Credit processing fees (6)
|
|
|
|
|
195
|
|
|
|
|
272
|
|
|
|
200
|
|
Cloud-based software implementation costs (3)
|
|
|
|
|
1,715
|
|
|
|
|
—
|
|
|
|
2,200
|
|
Adjusted EBITDA
|
|
|
|
$
|
19,415
|
|
|
|
$
|
17,857
|
|
|
|
$ 27,500 — $ 30,500
|
|
* Totals may not sum due to rounding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
|
|
In mid-March 2018, we entered into an asset purchase agreement with
a private, strategic buyer for the sale of our PlaneTechs service
line, which resulted in a pre-tax gain of $1.4 million.
|
|
|
|
|
|
|
(2)
|
|
|
|
Amortization of intangible assets of acquired businesses as well as
accretion expense related to the SIMOS acquisition earn-out.
|
|
|
|
|
|
|
(3)
|
|
|
|
Implementation costs for cloud-based systems.
|
|
|
|
|
|
|
(4)
|
|
|
|
Total tax effect of each of the adjustments to U.S. GAAP net income
using the expected ongoing rate of 16 percent for 2018, due to the
enacted U.S. Tax Cuts and Jobs Act, and 28 percent for 2017.
|
|
|
|
|
|
|
(5)
|
|
|
|
Adjustment of the effective income tax rate to the expected ongoing
rate of 16 percent for 2018, due to the enacted U.S. Tax Cuts and
Jobs Act, and 28 percent for 2017.
|
|
|
|
|
|
|
(6)
|
|
|
|
These third-party processing fees are associated with generating the
Work Opportunity Tax Credits, which are designed to encourage
employers to hire workers from certain targeted groups with higher
than average unemployment rates and reduce our income taxes.
|
|
|
|
|
|
|
|
|
TRUEBLUE, INC.
|
|
SEGMENT INFORMATION
|
|
|
|
3. SEGMENT DATA
|
|
(Unaudited)
|
|
|
|
|
|
|
13 Weeks Ended
|
|
(in thousands)
|
|
|
|
Apr 1, 2018
|
|
|
Apr 2, 2017
|
|
Revenue from services:
|
|
|
|
|
|
|
|
|
PeopleReady
|
|
|
|
$
|
316,835
|
|
|
|
$
|
332,624
|
|
|
PeopleManagement
|
|
|
|
|
183,892
|
|
|
|
|
191,686
|
|
|
PeopleScout
|
|
|
|
|
53,661
|
|
|
|
|
43,934
|
|
|
Total company
|
|
|
|
|
554,388
|
|
|
|
|
568,244
|
|
|
|
|
|
|
|
|
|
|
Segment profit (1):
|
|
|
|
|
|
|
|
|
PeopleReady
|
|
|
|
$
|
9,525
|
|
|
|
$
|
9,994
|
|
|
PeopleManagement
|
|
|
|
|
5,649
|
|
|
|
|
5,533
|
|
|
PeopleScout
|
|
|
|
|
11,905
|
|
|
|
|
8,665
|
|
|
Total segment profit
|
|
|
|
|
27,079
|
|
|
|
|
24,192
|
|
|
Corporate unallocated expense
|
|
|
|
|
(7,664
|
)
|
|
|
|
(6,335
|
)
|
|
Total company Adjusted EBITDA
|
|
|
|
|
19,415
|
|
|
|
|
17,857
|
|
|
Work Opportunity Tax Credit processing fees (2)
|
|
|
|
|
(195
|
)
|
|
|
|
(272
|
)
|
|
Cloud-based software implementation costs (3)
|
|
|
|
|
(1,715
|
)
|
|
|
|
—
|
|
|
EBITDA
|
|
|
|
|
17,505
|
|
|
|
|
17,585
|
|
|
Depreciation and amortization
|
|
|
|
|
(10,090
|
)
|
|
|
|
(11,174
|
)
|
|
Interest and other income (expense), net
|
|
|
|
|
2,204
|
|
|
|
|
74
|
|
|
Income before tax expense
|
|
|
|
|
9,619
|
|
|
|
|
6,485
|
|
|
Income tax expense
|
|
|
|
|
(864
|
)
|
|
|
|
(1,811
|
)
|
|
Net income
|
|
|
|
$
|
8,755
|
|
|
|
$
|
4,674
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
|
|
We evaluate performance based on segment revenue and segment
profit. Segment profit includes revenue, related cost of services,
and ongoing operating expenses directly attributable to the
reportable segment. Segment profit excludes goodwill and
intangible impairment charges, depreciation and amortization
expense, unallocated corporate general and administrative expense,
interest, other income and expense, income taxes, and costs not
considered to be ongoing costs of the segment. Segment profit is
comparable to segment adjusted EBITDA amounts reported in prior
periods.
|
|
|
|
|
|
|
(2)
|
|
|
|
These third-party processing fees are associated with generating the
Work Opportunity Tax Credits, which are designed to encourage
employers to hire workers from certain targeted groups with higher
than average unemployment rates and reduce our income taxes.
|
|
|
|
|
|
|
(3)
|
|
|
|
Implementation costs for cloud-based systems.
|
View source version on businesswire.com:
https://www.businesswire.com/news/home/20180430006179/en/
TrueBlue, Inc.
Derrek Gafford, 253-680-8214
EVP & CFO
Source: TrueBlue, Inc.