TrueBlue Reports First Quarter 2008 Results


TrueBlue, Inc. (NYSE:TBI), today reported revenue for the first quarter ended March 28, 2008, of $324 million, an increase of 12 percent from $290 million for the first quarter of 2007. For the first quarter of 2008, the company generated net income of $8.8 million, or $0.20 per diluted share, a decrease in net income of 15 percent from $10.3 million, or $0.21 per diluted share, for the first quarter of 2007.

The 12 percent increase in revenue this quarter was comprised of 15 percentage points of revenue growth from acquisitions made within the last 12 months offset by a decline of three percentage points in revenue from comparable operations.

"Same branch revenue declined two percent during the first quarter," said TrueBlue CEO Steve Cooper. "The rate of decline increased during the final weeks of the quarter and into the first two weeks of the second quarter. Our customers continue to face difficult economic conditions, and growth in the industrial staffing sector will be a challenge in the short term."

Cooper added, "Revenue from recently acquired PlaneTechs exceeded our expectations for the quarter. Demand for aviation mechanics has continued to increase, and our PlaneTechs employees have done an excellent job filling that demand."

TrueBlue opened three branches, closed six branches, and acquired 10 branches with the acquisition of TLC, a truck-driver staffing company, resulting in 901 branches in operation at the end of the quarter.

For the second quarter of 2008, TrueBlue estimates revenue in the range of $350 to $355 million with net income per diluted share for the quarter in the range of $0.28 to $0.30.

The second quarter estimates do not include the potential impact of the PMI acquisition which TrueBlue announced earlier today. If the PMI transaction closes at the end of April as anticipated, TrueBlue would expect it to add approximately $20 million in revenue to the second quarter of 2008. Net income per diluted share for the second quarter is expected to remain unchanged due to the amortization of intangible assets and integration costs associated with the PMI transaction.

Management will discuss first quarter 2008 results on a conference call at 2 p.m. (PT), today, Wednesday April 16, 2008. The conference call can be accessed on TrueBlue's web site:

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.

About TrueBlue

TrueBlue (NYSE:TBI) is the leading provider of blue-collar staffing, with sales of nearly $1.4 billion in 2007. Each year, TrueBlue connects approximately 600,000 people to work through the following brands: Labor Ready (general labor), Spartan Staffing (light industrial), and CLP Resources, PlaneTechs and TLC Drivers (skilled trades). 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

                            TrueBlue, Inc.
                 In Thousands, except per share data

                                                Thirteen Weeks Ended
                                               March 28,   March 30,
                                                 2008        2007

Revenue from services                           $324,016    $ 290,237
Cost of services                                 225,661      197,446
                                              ----------- ------------
Gross profit                                      98,355       92,791
Selling, general and
  administrative expenses                         82,484       77,376
Depreciation and amortization                      3,908        2,401
                                              ----------- ------------
Income from operations                            11,963       13,014
Interest and other income, net                     1,896        3,282
                                              ----------- ------------
Income before tax expense                         13,859       16,296
Income tax expense                                 5,058        5,948
                                              ----------- ------------
Net income                                      $  8,801    $  10,348
                                              =========== ============

Net income per common share:
  Basic                                         $   0.20    $    0.21
  Diluted                                       $   0.20    $    0.21

Weighted average shares outstanding:
  Basic                                           43,362       49,076
  Diluted                                         43,494       49,342

                            TrueBlue, Inc.
                             In Thousands

                                               March 28,  December 28,
                                                 2008        2007

  Current assets
    Cash and cash equivalents                   $ 75,025    $  57,008
    Marketable securities                          1,025       10,954
    Accounts receivable, net                     138,342      140,027
    Other current assets                          19,995       21,519
                                              ----------- ------------
  Total current assets                           234,387      229,508
  Property and equipment, net                     48,368       44,909
  Restricted cash                                126,298      132,497
  Other assets                                   142,278      138,335
                                              ----------- ------------
      Total assets                              $551,331    $ 545,249
                                              =========== ============

Liabilities and shareholders' equity
  Current liabilities                           $105,469    $ 114,538
  Long-term liabilities                          149,636      146,884
                                              ----------- ------------
      Total liabilities                          255,105      261,422
  Shareholders' equity                           296,226      283,827
                                              ----------- ------------
      Total liabilities and shareholders'
       equity                                   $551,331    $ 545,249
                                              =========== ============

                            TrueBlue, Inc.
                             In Thousands

                                                Thirteen Weeks Ended
                                               March 28,   March 30,
                                                 2008        2007

Cash flows from operating activities:
   Net income                                   $  8,801    $  10,348
Adjustments to reconcile net income to
 net cash provided by operating activities:
   Depreciation and amortization                   3,908        2,401
   Provision for doubtful accounts                 2,252        1,631
   Stock-based compensation                        2,768        2,356
   Excess tax benefits from stock-based
    compensation                                       -         (418)
   Deferred income taxes                             421          229
   Other operating activities                        132            -
Changes in operating assets and liabilities,
  exclusive of business acquired:
   Accounts receivable                              (796)       3,793
   Income taxes                                   (6,036)       4,792
   Other assets                                    1,916        3,889
   Accounts payable and other accrued expenses      (510)       5,478
   Accrued wages and benefits                        463       (5,179)
   Workers' compensation claims reserve              602       (1,588)
   Other liabilities                                (486)           -
                                              ----------- ------------
Net cash provided by operating activities         13,435       27,732
                                              ----------- ------------

Cash flows from investing activities:
   Capital expenditures                           (5,829)      (6,189)
   Purchases of marketable securities            (27,144)    (102,813)
   Maturities of marketable securities            37,055      110,496
   Acquisition of business                        (5,319)           -
   Change in restricted cash                       6,199       (1,891)
   Other                                              45            -
                                              ----------- ------------
Net cash provided by (used in) investing
 activities                                        5,007         (397)
                                              ----------- ------------

Cash flows from financing activities:
   Purchases and retirement of common stock            -      (76,749)
   Net proceeds from sale of stock through
    options and employee benefit plans               544        1,489
   Shares withheld for taxes upon vesting of
    restricted stock                                (617)        (652)
   Excess tax benefits from stock-based
    compensation                                       -          418
   Payments on debt                                  (64)        (188)
                                              ----------- ------------
Net cash used in financing activities               (137)     (75,682)
                                              ----------- ------------

   Effect of exchange rates on cash                 (288)         199
                                              ----------- ------------

   Net change in cash and cash equivalents        18,017      (48,148)

CASH AND CASH EQUIVALENTS, beginning of period    57,008      107,944
                                              ----------- ------------
CASH AND CASH EQUIVALENTS, end of period        $ 75,025    $  59,796
                                              =========== ============

Source: TrueBlue, Inc.