Release Date: November 04, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- TrueBlue Inc (TBI, Financial) successfully rolled out its new proprietary JobStack app ahead of schedule, enhancing user experience and operational efficiency.
- The company reported double-digit growth in its commercial driving services for the third consecutive quarter.
- TrueBlue Inc (TBI) has expanded its presence in high-growth markets such as healthcare and skilled trades, securing new wins in these sectors.
- The company has made significant progress in simplifying its organizational structure, leading to improved synergies and cross-selling opportunities.
- TrueBlue Inc (TBI) reduced its SG&A expenses by 17% for the quarter, demonstrating effective cost management.
Negative Points
- TrueBlue Inc (TBI) experienced a 19% decline in revenue compared to the prior year, reflecting challenging market conditions.
- The company reported a net loss of $8 million for the quarter, impacted by income tax expenses and valuation allowances.
- PeopleScout segment revenue decreased by 31%, with a significant impact from the loss of a large hospitality client.
- The renewable energy segment did not grow in the quarter due to weather-related delays and fluctuations in project volumes.
- TrueBlue Inc (TBI) anticipates a continued revenue decline in the fourth quarter, with guidance reflecting a 24% to 18% decrease.
Q & A Highlights
Q: Can you provide insights on customer account trends and whether the current revenue weakness is volume-driven or due to customer attrition?
A: Despite market challenges, TrueBlue has retained and expanded existing customer relationships while winning new ones. PeopleReady's customer count grew sequentially into Q3, and PeopleScout nearly doubled new annualized wins compared to last year. PeopleManagement also saw double-digit growth in new wins year-to-date. The current revenue weakness is more volume-driven than due to customer attrition. - Taryn R. Owen, President & CEO
Q: What are the revenue growth rates by segment and the bill pay spread for the quarter?
A: For Q4, TrueBlue's revenue is expected to decline by 21% on a GAAP basis, with PeopleReady down 24%, PeopleManagement down 13%, and PeopleScout down 30%. On a comparable basis, these figures are down 14%, 15%, 7%, and 28%, respectively. Pay rates increased by 1.5%, while bill rates rose by 0.2%, leading to a 60 basis point decline in margin. - Carl Schweihs, EVP & CFO
Q: How have hurricanes impacted your business, and what is the financial impact?
A: Hurricanes typically have an immediate negative impact but tend to be net neutral or slightly positive over time due to cleanup efforts. In Q3, Hurricane Helene had a negative impact of about $700,000, and Hurricane Milton is expected to impact Q4 by approximately $900,000. These impacts are included in our guidance. - Carl Schweihs, EVP & CFO
Q: Can you discuss the slowdown in the renewables business and its future outlook?
A: The slowdown was primarily due to weather impacts. However, the pipeline remains strong with new wins in large-scale utility solar projects expected to bring revenue in 2025. We are also seeing opportunities in solar panel manufacturing and engineering roles, indicating a positive mid- to long-term outlook. - Taryn R. Owen, President & CEO
Q: How is the rollout of the JobStack app progressing, and what feedback have you received?
A: The JobStack app rollout is ahead of schedule, allowing us to quickly address user needs. We've implemented features like a text-by feature for candidates and an intuitive order extension feature for customers. Initial feedback is positive, with improved adoption rates and user experience. - Taryn R. Owen, President & CEO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
