TrueBlue Reports 2008 Second Quarter Results
TACOMA, Wash.--(BUSINESS WIRE)--
TrueBlue, Inc. (NYSE:TBI):
Second Quarter Summary
-- Revenue of $371 million, an increase of 6% compared to the
second quarter of 2007.
-- Net income of $16.7 million, a decrease of 11% compared to the
second quarter of 2007.
-- Diluted net income per common share of $0.39 compared to $0.41
for the second quarter of 2007.
The six percent revenue growth for the quarter consisted of 18 percent growth from acquisitions completed within the last 12 months offset by a 12 percent decrease in organic revenue growth, which consists of total revenue growth less growth from acquisitions.
Included in net income for the second quarter is $0.04 per diluted share of income tax benefit from the resolution of certain income tax matters.
"Economic pressures have created a broad-based reduction in demand across the geographies and industries we serve," said TrueBlue CEO Steve Cooper. "We responded this quarter by further reducing our cost structure through closing branches and reducing other expenses. We will continue our disciplined approach to controlling the costs of our operations as we manage through these difficult conditions."
Branch and Acquisition Activity
TrueBlue acquired 44 branches with the acquisition of PMI, a light industrial staffing company, and closed 18 branches across multiple brands, resulting in 927 total branches in operation at the end of the quarter. Year-to-date branch closures for 2008 total 24.
Since May 2007, TrueBlue has completed four acquisitions: Skilled Services in May 2007 to grow the CLP skilled construction trades brand; PlaneTechs in December 2007 to enter the aviation mechanic staffing market; TLC in February 2008 to enter the truck driver staffing market; and PMI in May 2008 to expand TrueBlue's geographic presence in the light industrial staffing market.
"Our acquisitions position us well for growth," said Cooper. "However, our top priority is to maximize the performance of our existing operations."
Share Repurchase and Q3 Outlook
TrueBlue repurchased 0.88 million shares during the quarter at a cost of $11.5 million and 0.35 million shares at a cost of $4.5 million following the end of the quarter. Under the current share repurchase authorization, $21.5 million remains available for repurchase.
For the third quarter of 2008, TrueBlue estimates revenue in the range of $390 to $400 million with net income per diluted share for the quarter in the range of $0.38 to $0.42.
Management will discuss second quarter 2008 results on a conference call at 2 p.m. (PT), today, Wednesday July 16, 2008. The conference call can be accessed on TrueBlue's web site: www.TrueBlueInc.com.
About TrueBlue
TrueBlue (NYSE:TBI) is the leading provider of blue-collar staffing with revenue of approximately $1.4 billion. Each year, TrueBlue connects approximately 600,000 people to work through the following brands: Labor Ready, PMI, Spartan Staffing, CLP Resources, PlaneTechs, and TLC Drivers. Headquartered in Tacoma, Wash., TrueBlue serves more than 300,000 small to mid-sized businesses in the construction, warehousing, hospitality, landscaping, transportation, light manufacturing, retail, wholesale, facilities, sanitation, and aviation industries. For more information, visit TrueBlue's website at www.TrueBlueInc.com.
Forward-Looking Statements
This news release contains forward-looking statements, such as statements about the ranges of revenues, gross margins and net income anticipated for future periods, improvements in safety and workers' compensation claims and costs, strategies for increasing revenue and net income, and other factors that may affect TrueBlue's financial results and operations in the future. TrueBlue's actual results are, however, subject to a number of risks, including without limitation the following: 1) national and global economic conditions, including the impact of changes in national and global credit markets and other changes on TrueBlue customers; 2) TrueBlue's ability to continue to attract and retain customers and maintain profit margins in the face of new and existing competition; 3) potential new laws and regulations that could have a materially adverse effect on TrueBlue's operations and financial results; 4) significant labor disturbances which could disrupt industries TrueBlue serves; 5) increased costs and collateral requirements in connection with TrueBlue's insurance obligations, including workers' compensation insurance; 6) the adequacy of TrueBlue's financial reserves; 7) TrueBlue's continuing ability to comply with financial covenants in its lines of credit and other financing agreements; 8) TrueBlue's ability to attract and retain competent employees in key positions or to find temporary employees or skilled trade workers to fulfill the needs of our customers; 9) TrueBlue's ability to successfully complete and integrate acquisitions that it may make from time to time; 10) TrueBlue's ability to timely execute strategies for acquired companies; and 11) other risks described in TrueBlue's filings with the Securities and Exchange Commission, including its most recent Form 10-K and Form 10-Q filings.
TrueBlue, Inc.
SUMMARY CONSOLIDATED STATEMENTS OF INCOME
In Thousands, except per share data
(Unaudited)
Thirteen Weeks Ended Twenty-Six Weeks Ended
-------------------- ----------------------
June 27, June 29, June 27, June 29,
2008 2007 2008 2007
---------- --------- ----------- ----------
Revenue from services $ 370,710 $ 351,131 $ 694,726 $ 641,368
Cost of services 260,167 239,244 485,828 436,690
---------- --------- ----------- ----------
Gross profit 110,543 111,887 208,898 204,678
Selling, general and
administrative expenses 84,569 81,902 167,053 159,278
Depreciation and
amortization 3,967 2,858 7,875 5,259
---------- --------- ----------- ----------
Income from operations 22,007 27,127 33,970 40,141
Interest and other income,
net 1,624 2,438 3,520 5,719
---------- --------- ----------- ----------
Income before tax expense 23,631 29,565 37,490 45,860
Income tax expense 6,903 10,791 11,961 16,739
---------- --------- ----------- ----------
Net income $ 16,728 $ 18,774 $ 25,529 $ 29,121
========== ========= =========== ==========
Net income per common
share:
Basic $ 0.39 $ 0.41 $ 0.59 $ 0.61
Diluted $ 0.39 $ 0.41 $ 0.59 $ 0.61
Weighted average shares
outstanding:
Basic 43,194 45,888 43,278 47,482
Diluted 43,338 46,201 43,416 47,771
TrueBlue, Inc.
SUMMARY CONSOLIDATED BALANCE SHEETS
In Thousands
June 27, December 28,
2008 2007
(Unaudited)
----------- ------------
Assets
Current assets
Cash and cash equivalents $ 65,749 $ 57,008
Marketable securities 1,029 10,954
Accounts receivable, net 148,977 140,027
Other current assets 22,439 21,519
----------- ------------
Total current assets 238,194 229,508
Property and equipment, net 52,439 44,909
Restricted cash 121,257 132,497
Other assets 155,463 138,335
----------- ------------
Total assets $ 567,353 $ 545,249
=========== ============
Liabilities and shareholders' equity
Current liabilities $ 108,129 $ 114,538
Long-term liabilities 155,370 146,884
----------- ------------
Total liabilities 263,499 261,422
Shareholders' equity 303,854 283,827
----------- ------------
Total liabilities and shareholders'
equity $ 567,353 $ 545,249
=========== ============
TrueBlue, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
In Thousands
(Unaudited)
Twenty-Six Weeks Ended
----------------------
June 27, June 29,
2008 2007
----------- ----------
Cash flows from operating activities:
Net income $ 25,529 $ 29,121
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 7,875 5,259
Provision for doubtful accounts 4,453 4,184
Stock-based compensation 4,504 3,960
Excess tax benefits from stock-based
compensation - (1,045)
Deferred income taxes (2,087) (3,289)
Other operating activities 146 -
Changes in operating assets and liabilities,
exclusive of businesses acquired:
Accounts receivable (2,475) (14,557)
Income taxes (6,092) 9,588
Other assets 2,512 5,397
Accounts payable and other accrued expenses (2,502) 3,321
Accrued wages and benefits 1,633 (1,792)
Workers' compensation claims reserve 3,141 1,579
Other liabilities (2,717) 319
----------- ----------
Net cash provided by operating activities 33,920 42,045
----------- ----------
Cash flows from investing activities:
Capital expenditures (11,681) (11,077)
Purchases of marketable securities (27,146) (137,864)
Maturities of marketable securities 37,055 178,964
Acquisitions of businesses, net of cash
acquired (22,574) (26,415)
Change in restricted cash 11,240 (3,956)
Other (21) -
----------- ----------
Net cash used in investing activities (13,127) (348)
----------- ----------
Cash flows from financing activities:
Purchases and retirement of common stock (11,501) (94,818)
Net proceeds from sale of stock through
options and employee benefit plans 1,208 3,339
Shares withheld for taxes upon vesting of
restricted stock (850) (892)
Excess tax benefits from stock-based
compensation - 1,045
Payments on debt (128) (745)
Other (229) -
----------- ----------
Net cash used in financing activities (11,500) (92,071)
----------- ----------
Effect of exchange rates on cash (552) 1,115
----------- ----------
Net change in cash and cash equivalents 8,741 (49,259)
CASH AND CASH EQUIVALENTS, beginning of period 57,008 107,944
----------- ----------
CASH AND CASH EQUIVALENTS, end of period $ 65,749 $ 58,685
=========== ==========
Source: TrueBlue, Inc.
Released July 16, 2008