false000076889900007688992024-08-052024-08-05
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): August 5, 2024
TrueBlue, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Washington
(State or Other Jurisdiction
of Incorporation)
| | | | | | | | |
001-14543 | | 91-1287341 |
(Commission File Number) | | (IRS Employer Identification No.) |
1015 A Street, Tacoma, Washington 98402
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (253) 383-9101
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
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Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common stock, no par value | TBI | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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Item 2.02. | Results of Operations and Financial Condition. |
On August 5, 2024, TrueBlue, Inc. (the “company”) issued a press release (the “Press Release”) reporting its financial results for the second quarter ended June 30, 2024, and certain outlook information for the third quarter and fiscal year 2024, a copy of which is attached hereto as Exhibit 99.1 and the contents of which are incorporated herein by this reference. Also attached to this report as Exhibit 99.2 is a slide presentation relating to the financial results for the second quarter ended June 30, 2024 (the “Earnings Results Presentation”), which will be discussed by management of the company on a live conference call at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time) on Monday, August 5, 2024. The Earnings Results Presentation is also available on the company’s website at www.trueblue.com.
In accordance with General Instruction B.2. of Form 8-K, the information contained above in this report (including the Press Release and the Earnings Results Presentation) shall not be deemed “Filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall the Press Release or the Earnings Results Presentation be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing. This report will not be deemed a determination or an admission as to the materiality of any information in the report that is required to be disclosed solely by Regulation FD.
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Item 7.01. | Regulation FD Disclosure. |
We are also attaching our Investor Roadshow Presentation to this report as Exhibit 99.3, which we will reference in our Q2 2024 earnings results discussion and which may be used in future investor conferences. The Investor Roadshow Presentation is also available on the company’s website at www.trueblue.com.
In accordance with General Instruction B.2. of Form 8-K, the information contained above in this report (including the Investor Roadshow Presentation) shall not be deemed “Filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall the Investor Roadshow Presentation be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing. This report will not be deemed a determination or an admission as to the materiality of any information in the report that is required to be disclosed solely by Regulation FD.
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Item 9.01. | Financial Statements and Exhibits. |
(d)Exhibits
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Exhibit Number | Exhibit Description | Filed Herewith |
99.1 | | X |
99.2 | | X |
99.3 | | X |
104 | Cover page interactive data file - The cover page from this Current Report on Form 8-K is formatted as Inline XBRL | X |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| | TRUEBLUE, INC. |
| | (Registrant) |
| | |
Date: | August 5, 2024 | By: | | /s/ Carl R. Schweihs |
| | | | Carl R. Schweihs |
| | | | Chief Financial Officer and Executive Vice President |
TRUEBLUE REPORTS SECOND QUARTER 2024 RESULTS
TACOMA, WASH. - Aug. 5, 2024 -- TrueBlue (NYSE:TBI) today announced its second quarter results for 2024.
Second Quarter 2024 Financial Highlights
•Revenue of $396 million compared to $476 million in the prior year period
•Net loss of $105 million compared to net loss of $7 million in the prior year period
◦Includes non-cash goodwill and intangible asset impairment charge of $45 million after tax and a related valuation allowance charge of $55 million on deferred tax assets
◦SG&A expense reduced by 20 percent to $97 million compared to $121 million in the prior year period
◦Adjusted EBITDA1 of $1 million and adjusted net loss of $11 million
• Zero debt, cash of $26 million and $132 million of borrowing availability
•$7 million in share repurchases with $38 million remaining under authorization
Commentary
“We are managing through the current market cycle with discipline and agility as economic uncertainty and client caution continue to weigh on the temporary staffing industry,” said Taryn Owen, President and CEO of TrueBlue. “Our teams are staying highly engaged with clients to address their immediate and evolving needs. While current market dynamics are challenging, evolving workforce needs and structural staffing shortages will create compelling opportunities for our business that align with our competitive strengths.”
“We have made significant progress advancing our strategic priorities which will enable us to capture market share, deliver more sustainable growth and enhance our long-term profitability,” continued Ms. Owen. “Our commitment to digital transformation with the continued rollout of our new, proprietary JobStack app, along with expansion in attractive end markets such as skilled trades and healthcare will fuel our growth as demand rebounds. Additionally, simplifying our organizational structure and taking decisive cost actions not only aligns TrueBlue with the current environment, but ensures we are even better positioned to capitalize on growth opportunities and expand our profitability as conditions improve.”
Results
Second quarter revenue was $396 million, a decrease of 17 percent compared to revenue of $476 million in the second quarter of 2023. Net loss per diluted share was $3.45 compared to net loss per diluted share of $0.24 in the prior year period. Adjusted net loss1 per diluted share was $0.35 compared to adjusted net income per diluted share of $0.11 in the prior year period.
2024 Outlook
TrueBlue is providing certain forward-looking information to help investors form their own estimates, which can be found in the quarterly earnings presentation filed today.
Management will discuss second quarter 2024 results on a webcast at 2:00 p.m. PT (5:00 p.m. ET), today, Monday, Aug. 5, 2024. The webcast can be accessed on the Investor Relations section of the TrueBlue website: investor.trueblue.com.
About TrueBlue
TrueBlue (NYSE: TBI) is a leading provider of specialized workforce solutions that help clients achieve business growth and improve productivity. In 2023, TrueBlue served approximately 67,000 clients and connected approximately 464,000 people with work. Its PeopleReady segment offers on-demand, industrial staffing, PeopleScout offers recruitment process outsourcing (RPO) and managed service provider (MSP) solutions, and PeopleManagement offers contingent, on-site industrial staffing and commercial driver services. Learn more at www.trueblue.com.
1 Refer to the financial statements accompanying this release for more information regarding non-GAAP terms.
Forward-looking statements and non-GAAP financial measures
This document contains forward-looking statements relating to our plans and expectations including, without limitation, statements regarding the future performance and operations of our business, expectations regarding stabilization in demand, and expected growth from our digital investments, 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, which can be negatively impacted by factors such as rising interest rates, inflation, political instability, epidemics and global trade uncertainty, (2) our ability to maintain profit margins, (3) our ability to successfully execute on business strategies and further digitalize our business model, (4) our ability to attract sufficient qualified candidates and employees to meet the needs of our clients, (5) our ability to attract and retain clients, (6) our ability to access sufficient capital to finance our operations, including our ability to comply with covenants contained in our revolving credit facility, (7) new laws, regulations, and government incentives that could affect our operations or financial results, (8) any reduction or change in tax credits we utilize, including the Work Opportunity Tax Credit, and (9) the timing and amount of common stock repurchases, if any, which will be determined at management’s discretion and depend upon several factors, including market and business conditions, the trading price of our common stock and the nature of other investment opportunities. Other information regarding factors that could affect our results is included in our Securities and 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 references 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 U.S. 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 additional information 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.
Contact
Investor Relations
InvestorRelations@trueblue.com
TRUEBLUE, INC.
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | |
| 13 weeks ended | | 26 weeks ended |
(in thousands, except per share data) | Jun 30, 2024 | | Jun 25, 2023 | | Jun 30, 2024 | | Jun 25, 2023 |
Revenue from services | $ | 396,230 | | | $ | 475,588 | | | $ | 799,083 | | | $ | 940,876 | |
Cost of services | 291,807 | | | 345,097 | | | 595,274 | | | 687,272 | |
Gross profit | 104,423 | | | 130,491 | | | 203,809 | | | 253,604 | |
Selling, general and administrative expense | 97,018 | | | 121,282 | | | 203,955 | | | 243,927 | |
Depreciation and amortization | 7,691 | | | 6,280 | | | 15,649 | | | 12,691 | |
Goodwill and intangible asset impairment charge | 59,674 | | | 9,485 | | | 59,674 | | | 9,485 | |
Loss from operations | (59,960) | | | (6,556) | | | (75,469) | | | (12,499) | |
Interest and other income (expense), net | 1,741 | | | 578 | | | 3,340 | | | 1,592 | |
Loss before tax expense | (58,219) | | | (5,978) | | | (72,129) | | | (10,907) | |
Income tax expense | 46,491 | | | 1,345 | | | 34,279 | | | 705 | |
Net loss | $ | (104,710) | | | $ | (7,323) | | | $ | (106,408) | | | $ | (11,612) | |
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Net loss per common share: | | | | | | | |
Basic | $ | (3.45) | | | $ | (0.24) | | | $ | (3.46) | | | $ | (0.37) | |
Diluted | $ | (3.45) | | | $ | (0.24) | | | $ | (3.46) | | | $ | (0.37) | |
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Weighted average shares outstanding: | | | | | | | |
Basic | 30,349 | | | 30,966 | | | 30,725 | | | 31,629 | |
Diluted | 30,349 | | | 30,966 | | | 30,725 | | | 31,629 | |
TRUEBLUE, INC.
SUMMARY CONSOLIDATED BALANCE SHEETS
(Unaudited)
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(in thousands) | Jun 30, 2024 | | Dec 31, 2023 |
ASSETS | | | |
Cash and cash equivalents | $ | 26,400 | | | $ | 61,885 | |
Accounts receivable, net | 231,064 | | | 252,538 | |
Other current assets | 43,180 | | | 40,570 | |
Total current assets | 300,644 | | | 354,993 | |
Property and equipment, net | 92,100 | | | 104,906 | |
Restricted cash, cash equivalents and investments | 183,352 | | | 192,985 | |
Goodwill and intangible assets, net | 31,941 | | | 94,639 | |
Other assets, net | 115,656 | | | 151,860 | |
Total assets | $ | 723,693 | | | $ | 899,383 | |
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LIABILITIES AND SHAREHOLDERS’ EQUITY | | | |
Accounts payable and other accrued expenses | $ | 36,107 | | | $ | 56,401 | |
Accrued wages and benefits | 65,774 | | | 80,120 | |
Current portion of workers’ compensation claims reserve | 38,728 | | | 44,866 | |
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Other current liabilities | 17,380 | | | 22,712 | |
Total current liabilities | 157,989 | | | 204,099 | |
Workers’ compensation claims reserve, less current portion | 139,251 | | | 151,649 | |
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Other long-term liabilities | 88,689 | | | 85,762 | |
Total liabilities | 385,929 | | | 441,510 | |
Shareholders’ equity | 337,764 | | | 457,873 | |
Total liabilities and shareholders’ equity | $ | 723,693 | | | $ | 899,383 | |
TRUEBLUE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| | | | | | | | | | | |
| 26 weeks ended |
(in thousands) | Jun 30, 2024 | | Jun 25, 2023 |
Cash flows from operating activities: | | | |
Net loss | $ | (106,408) | | | $ | (11,612) | |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | | | |
Depreciation and amortization | 15,649 | | | 12,691 | |
Goodwill and intangible asset impairment charge | 59,674 | | | 9,485 | |
Provision for credit losses | 630 | | | 2,408 | |
Stock-based compensation | 4,844 | | | 5,294 | |
Deferred income taxes | 33,997 | | | (22) | |
Non-cash lease expense | 6,200 | | | 6,249 | |
Other operating activities | (3,118) | | | (1,099) | |
Changes in operating assets and liabilities: | | | |
Accounts receivable | 21,061 | | | 43,915 | |
Income taxes receivable and payable | 430 | | | (3,039) | |
| | | |
Other assets | 8,246 | | | 15,053 | |
Accounts payable and other accrued expenses | (18,849) | | | (26,968) | |
Accrued wages and benefits | (14,753) | | | (9,277) | |
| | | |
Workers’ compensation claims reserve | (18,537) | | | (19,899) | |
Operating lease liabilities | (6,139) | | | (6,295) | |
Other liabilities | 1,011 | | | 3,980 | |
Net cash (used in) provided by operating activities | (16,062) | | | 20,864 | |
Cash flows from investing activities: | | | |
Capital expenditures | (13,279) | | | (15,738) | |
| | | |
Proceeds from business divestiture, net | 2,928 | | | — | |
Payments for company-owned life insurance | (4,000) | | | (2,347) | |
| | | |
| | | |
| | | |
Purchases of restricted held-to-maturity investments | (10,180) | | | (9,955) | |
Maturities of restricted held-to-maturity investments | 19,220 | | | 15,613 | |
| | | |
Net cash used in investing activities | (5,311) | | | (12,427) | |
Cash flows from financing activities: | | | |
Purchases and retirement of common stock | (16,986) | | | (34,200) | |
Net proceeds from employee stock purchase plans | 417 | | | 509 | |
Common stock repurchases for taxes upon vesting of restricted stock | (2,143) | | | (2,514) | |
| | | |
| | | |
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Other | (1,807) | | | (91) | |
Net cash used in financing activities | (20,519) | | | (36,296) | |
| | | |
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents | (557) | | | (20) | |
Net change in cash, cash equivalents, and restricted cash and cash equivalents | (42,449) | | | (27,879) | |
Cash, cash equivalents and restricted cash and cash equivalents, beginning of period | 99,306 | | | 135,631 | |
Cash, cash equivalents and restricted cash and cash equivalents, end of period | $ | 56,857 | | | $ | 107,752 | |
TRUEBLUE, INC.
SEGMENT DATA
(Unaudited)
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| | | | | | | |
| 13 weeks ended | | |
(in thousands) | Jun 30, 2024 | | Jun 25, 2023 | | | | |
Revenue from services: | | | | | | | |
PeopleReady | $ | 223,409 | | | $ | 275,318 | | | | | |
PeopleScout | 41,070 | | | 59,710 | | | | | |
PeopleManagement | 131,751 | | | 140,560 | | | | | |
Total company | $ | 396,230 | | | $ | 475,588 | | | | | |
| | | | | | | |
Segment profit (1): | | | | | | | |
PeopleReady | $ | 394 | | | $ | 8,158 | | | | | |
PeopleScout | 3,430 | | | 8,817 | | | | | |
PeopleManagement | 3,395 | | | 2,250 | | | | | |
Total segment profit | 7,219 | | | 19,225 | | | | | |
Corporate unallocated expense | (6,150) | | | (8,215) | | | | | |
Total company Adjusted EBITDA (2) | 1,069 | | | 11,010 | | | | | |
Third-party processing fees for hiring tax credits (3) | (90) | | | (110) | | | | | |
Amortization of software as a service assets (4) | (1,452) | | | (952) | | | | | |
| | | | | | | |
Goodwill and intangible asset impairment charge | (59,674) | | | (9,485) | | | | | |
| | | | | | | |
PeopleReady technology upgrade costs (5) | (39) | | | (174) | | | | | |
COVID-19 government subsidies, net (6) | 9,696 | | | — | | | | | |
| | | | | | | |
Other adjustments, net (7) | (1,779) | | | (565) | | | | | |
EBITDA (2) | (52,269) | | | (276) | | | | | |
Depreciation and amortization | (7,691) | | | (6,280) | | | | | |
Interest and other income (expense), net | 1,741 | | | 578 | | | | | |
Loss before tax expense | (58,219) | | | (5,978) | | | | | |
Income tax expense | (46,491) | | | (1,345) | | | | | |
Net loss | $ | (104,710) | | | $ | (7,323) | | | | | |
(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 depreciation and amortization expense, unallocated corporate general and administrative expense, interest expense, other income, income taxes, and other adjustments not considered to be ongoing.
(2)See the Non-GAAP Financial Measures table on the next page for definitions of EBITDA and Adjusted EBITDA.
(3)These third-party processing fees are associated with generating hiring tax credits.
(4)Amortization of software as a service assets is reported in selling, general and administrative expense.
(5)Costs associated with upgrading legacy PeopleReady technology.
(6)COVID-19 government subsidies net of related fees ($2.9 million in cost of services and $6.8 million in selling, general and administrative expense).
(7)Other adjustments for the 13 weeks ended June 30, 2024 and June 25, 2023 primarily include workforce reduction costs of $1.5 million ($0.2 million in cost of services and $1.3 million in selling, general and administrative expense) and $0.6 million ($0.2 million in cost of services and $0.4 million in selling, general and administrative expense), respectively.
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.
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Non-GAAP measure | | Definition | | Purpose of adjusted measures |
| | | | |
Adjusted net income (loss) and Adjusted net income (loss) per diluted share | | Net loss and net loss per diluted share, excluding: –amortization of intangibles, –goodwill and intangible asset impairment charge, –PeopleReady technology upgrade costs, –COVID-19 government subsidies, net, –other adjustments, net, and –tax effect of the adjustments and deferred tax asset valuation allowance.
| | –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.
|
EBITDA and Adjusted EBITDA | | EBITDA excludes from net loss: –income tax expense, –interest and other (income) expense, net, and –depreciation and amortization.
Adjusted EBITDA further excludes: –third-party processing fees for hiring tax credits, –amortization of software as a service assets, –goodwill and intangible asset impairment charge, –PeopleReady technology upgrade costs, –COVID-19 government subsidies, net and –other adjustments, net.
| | –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 SG&A expense | | Selling, general and administrative expense excluding: –third-party processing fees for hiring tax credits, –amortization of software as a service assets, –PeopleReady technology upgrade costs, –COVID-19 government subsidies, net and –other adjustments, net.
| | –Enhances comparability on a consistent basis and provides investors with useful insight into the underlying trends of the business. |
1.RECONCILIATION OF U.S. GAAP NET LOSS TO ADJUSTED NET INCOME (LOSS) AND ADJUSTED NET INCOME (LOSS) PER DILUTED SHARE
(Unaudited)
| | | | | | | | | | | | | | | |
| | | | | | | |
| 13 weeks ended | | |
(in thousands, except for per share data) | Jun 30, 2024 | | Jun 25, 2023 | | | | |
Net loss | $ | (104,710) | | | $ | (7,323) | | | | | |
| | | | | | | |
Amortization of intangible assets | 1,369 | | | 1,274 | | | | | |
| | | | | | | |
| | | | | | | |
Goodwill and intangible asset impairment charge | 59,674 | | | 9,485 | | | | | |
| | | | | | | |
PeopleReady technology upgrade costs (1) | 39 | | | 174 | | | | | |
COVID-19 government subsidies, net (2) | (9,696) | | | — | | | | | |
| | | | | | | |
Other adjustments, net (3) | 1,779 | | | 565 | | | | | |
Tax effect of adjustments and deferred tax asset valuation allowance (4) | 40,855 | | | (677) | | | | | |
| | | | | | | |
Adjusted net income (loss) | $ | (10,690) | | | $ | 3,498 | | | | | |
| | | | | | | |
Adjusted net income (loss) per diluted share | $ | (0.35) | | | $ | 0.11 | | | | | |
| | | | | | | |
Diluted weighted average shares outstanding | 30,349 | | | 31,185 | | | | | |
| | | | | | | |
Margin / % of revenue: | | | | | | | |
Net loss | (26.4)% | | (1.5)% | | | | |
Adjusted net income (loss) | (2.7)% | | 0.7% | | | | |
2.RECONCILIATION OF U.S. GAAP NET LOSS TO EBITDA AND ADJUSTED EBITDA
(Unaudited)
| | | | | | | | | | | | | | | |
| | | | | | | |
| 13 weeks ended | | |
(in thousands) | Jun 30, 2024 | | Jun 25, 2023 | | | | |
Net loss | $ | (104,710) | | | $ | (7,323) | | | | | |
Income tax expense | 46,491 | | | 1,345 | | | | | |
Interest and other (income) expense, net | (1,741) | | | (578) | | | | | |
Depreciation and amortization | 7,691 | | | 6,280 | | | | | |
EBITDA | (52,269) | | | (276) | | | | | |
Third-party processing fees for hiring tax credits (5) | 90 | | | 110 | | | | | |
Amortization of software as a service assets (6) | 1,452 | | | 952 | | | | | |
| | | | | | | |
Goodwill and intangible asset impairment charge | 59,674 | | | 9,485 | | | | | |
| | | | | | | |
PeopleReady technology upgrade costs (1) | 39 | | | 174 | | | | | |
COVID-19 government subsidies, net (2) | (9,696) | | | — | | | | | |
| | | | | | | |
Other adjustments, net (3) | 1,779 | | | 565 | | | | | |
Adjusted EBITDA | $ | 1,069 | | | $ | 11,010 | | | | | |
| | | | | | | |
Margin / % of revenue: | | | | | | | |
Net loss | (26.4)% | | (1.5)% | | | | |
Adjusted EBITDA | 0.3% | | 2.3% | | | | |
3.RECONCILIATION OF U.S. GAAP SELLING, GENERAL AND ADMINISTRATIVE EXPENSE TO ADJUSTED SG&A EXPENSE
(Unaudited)
| | | | | | | | | | | | | | | |
| | | | | | | |
| 13 weeks ended | | |
(in thousands) | Jun 30, 2024 | | Jun 25, 2023 | | | | |
Selling, general and administrative expense | $ | 97,018 | | | $ | 121,282 | | | | | |
Third-party processing fees for hiring tax credits (5) | (90) | | | (110) | | | | | |
Amortization of software as a service assets (6) | (1,452) | | | (952) | | | | | |
| | | | | | | |
| | | | | | | |
PeopleReady technology upgrade costs (1) | (39) | | | (174) | | | | | |
COVID-19 government subsidies, net (2) | 6,803 | | | — | | | | | |
| | | | | | | |
Other adjustments, net (3) | (1,608) | | | (390) | | | | | |
Adjusted SG&A expense | $ | 100,632 | | | $ | 119,656 | | | | | |
| | | | | | | |
% of revenue: | | | | | | | |
Selling, general and administrative expense | 24.5% | | 25.5% | | | | |
Adjusted SG&A expense | 25.4% | | 25.2% | | | | |
(1)Costs associated with upgrading legacy PeopleReady technology.
(2)COVID-19 government subsidies net of related fees ($2.9 million in cost of services and $6.8 million in selling, general and administrative expense).
(3)Other adjustments for the 13 weeks ended June 30, 2024 and June 25, 2023 primarily include workforce reduction costs of $1.5 million ($0.2 million in cost of services and $1.3 million in selling, general and administrative expense) and $0.6 million ($0.2 million in cost of services and $0.4 million in selling, general and administrative expense), respectively.
(4)The tax effect includes the application of our statutory rate of 26% to all taxable / deductible adjustments. The tax effect for the thirteen weeks ended June 30, 2024 also includes the $55 million valuation allowance recorded against the U.S. federal and state deferred tax assets. Note, prior periods were reported using the effective rate for the respective period and have been recast to conform to the current presentation for comparability. Please refer to the reconciliations on the financial results page under the investor relations section of our website for additional information on comparable historical periods.
(5)These third-party processing fees are associated with generating hiring tax credits.
(6)Amortization of software as a service assets is reported in selling, general and administrative expense.
Q2 2024 EARNINGS
2 Forward-looking statements and non-GAAP financial measures This presentation contains forward-looking statements relating to our plans and expectations including, without limitation, statements regarding the future performance and operations of our business, expectations regarding stabilization in demand, and expected growth from our digital investments, 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 presentation 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, which can be negatively impacted by factors such as rising interest rates, inflation, political instability, epidemics and global trade uncertainty, (2) our ability to maintain profit margins, (3) our ability to successfully execute on business strategies and further digitalize our business model, (4) our ability to attract sufficient qualified candidates and employees to meet the needs of our clients, (5) our ability to attract and retain clients, (6) our ability to access sufficient capital to finance our operations, including our ability to comply with covenants contained in our revolving credit facility, (7) new laws, regulations, and government incentives that could affect our operations or financial results, (8) any reduction or change in tax credits we utilize, including the Work Opportunity Tax Credit, and (9) the timing and amount of common stock repurchases, if any, which will be determined at management’s discretion and depend upon several factors, including market and business conditions, the trading price of our common stock and the nature of other investment opportunities. Other information regarding factors that could affect our results is included in our Securities and 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 references 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 presentation. Please refer to the reconciliations between our GAAP and non-GAAP financial measures in the appendix to this presentation and on our website at www.trueblue.com under the Investor Relations section for additional information 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. Any comparisons made herein to other periods are based on a comparison to the same period in the prior year unless otherwise stated.
3 Q2 2024 Overview Total revenue down 17% ▪ Macroeconomic uncertainty continues to weigh on customers causing softness in revenue trends with the exception of renewable energy projects and commercial driving services Net loss was $105 million ▪ Included a non-cash impairment charge of $45 million after tax and a related valuation allowance charge of $55 million on deferred tax assets ▪ Revenue decline was partially offset by disciplined cost management — SG&A reduced by 20% ▪ Adjusted EBITDA1 was $1 million Strong liquidity position while returning capital to shareholders ▪ Zero debt, cash of $26 million and $132 million of borrowing availability ▪ $7 million in share repurchases during the quarter with $38 million remaining under authorization 1 Refer to the appendix to this presentation for a definition and full reconciliation of non-GAAP financial measures to GAAP financial results for both current and historical periods.
4 Financial summary Amounts in millions, except per share data Q2 2024 Q2 2023 Change Revenue $396 $476 -17 % Net loss -$104.7 -$7.3 NM Net loss per diluted share -$3.45 -$0.24 NM Net loss margin -26.4 % -1.5 % -25 pp Adjusted net income (loss)1,2 -$10.7 $3.5 NM Adj. net income (loss) per diluted share -$0.35 $0.11 NM Adj. net income (loss) margin -2.7 % 0.7 % -3 pp Adjusted EBITDA $1.1 $11.0 -90 % Adjusted EBITDA margin 0.3 % 2.3 % -2 pp Notes: ▪ Net loss for Q2 2024 and Q2 2023 included non-cash impairment charges of $45 million and $9 million, respectively, after tax. Q2 2024 also included a valuation allowance charge of $55 million on deferred tax assets. ▪ The change in adjusted net income (loss) margin was more favorable than that of GAAP net loss margin primarily due to the non- cash impairment and valuation allowance charges, which were excluded from adjusted results. NM - Not meaningful 1 Refer to the appendix to this presentation for a definition and full reconciliation of non-GAAP financial measures to GAAP financial results. 2 Prior period adjusted net loss measures have been recast to conform to the current presentation for comparability. Refer to the reconciliations in the appendix to this presentation and on our website for additional information.
5 Gross margin and SG&A bridges Gr os s m ar gi n 27.4% -1.2% -0.5% 0.7% 26.4% Q2 2023 Mix Bill / Pay spread COVID-19 government subsidies Q2 2024 SG &A $121 -$19 -$5 $97 Q2 2023 Core business Q2 2024 Amounts in millions 1 Represents the year-over-year change in Adjusted EBITDA exclusions impacting SG&A. Refer to the adjusted EBITDA reconciliation in the appendix to this presentation for more information. Adjusted EBITDA exclusions1
6 Q2 2024 Results by segment Amounts in millions PeopleReady PeopleScout PeopleManagement Revenue $223 $41 $132 % Change -19% -31% -6% Segment profit1 $0 $3 $3 % Change -95% -61% +51% % Margin 0.2% 8.4% 2.6% Change -280 bps -640 bps +100 bps Notes: ▪ Revenue: • Softness across most verticals and geographies partially offset by growth in renewable energy work ▪ Segment profit margin: ▪ Contraction due to lower operating leverage as revenue declined ▪ Revenue: • Reduced client hiring volumes due to continued cost pressures ▪ Segment profit margin: ▪ Contraction due to lower operating leverage as revenue declined ▪ Revenue: • Lower on-site client volumes, primarily in the retail end market, partially offset by growth in commercial driving services ▪ Segment profit margin: ▪ Expansion due to disciplined cost management 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.
7 Strong balance sheet with zero debt and ample liquidity $344 $365 $148 $158 $294 $293 $86 $132 $50 $72 $62 $26 Borrowing availability Cash 2021 2022 2023 Q2 2024 Amounts in millions Note: Figures may not sum to consolidated totals due to rounding. Balances as of fiscal period end. 1 Borrowing availability is based on maximum borrowing availability under our most restrictive covenant. 2 Buyback ratio calculated as the dollar value of share repurchases during the period divided by our market capitalization at the beginning of the fiscal period. Liquidity Share repurchases 1 $17 $61 $34 $17 2% 6% 5% 4% Share repurchases Buyback ratio 2021 2022 2023 YTD Q2 2024 2
Outlook
9 Select outlook information Item Q3 2024 Commentary Revenue $380M to $405M -20% to -14% v. prior year Assumes current market conditions continue into Q3 and includes -1 percentage point from Canada sale. Gross margin -60 to -20 bps v. prior year Gross margin decline due primarily to changes in business mix. SG&A $99M to $103M SG&A reduction driven by disciplined cost management. Refer to the EBITDA adjustments below for additional information. EBITDA adjustments1 $5M • +$1M in PeopleReady technology upgrade costs • +$2M in SaaS amortization • +$2M in other adjustments Shares 30.0M Reflects approximate basic weighted average shares outstanding and does not include the impact of any potential share repurchases. Item FY 2024 Commentary CapEx2 $23M to $27M Depreciation also expected to be $23M to $27M. Tax Rate -35% to -40% Reflects expected effective income tax rate due to the valuation allowance charge in Q2 and minimal income tax expense / benefit in the second half of the year. 1 Refer to the appendix to this presentation for a definition of non-GAAP financial measures. 2 Includes planned investments in software as a service (SaaS) assets capitalized in other long-term assets with the related amortization recorded in SG&A.
10 Decisive cost actions to deliver efficiencies and enhanced long-term profitability $124 $121$121 $115 SG&A Adjusted SG&A Q3 2022 Q3 2023 Q3 2024 Outlook Amounts in millions Simplified organizational structure Enhanced automation Greater efficiencies Increased scalability $99 - $103 $95 - $99 1 1 Refer to the appendix to this presentation for a definition and full reconciliation of non-GAAP financial measures to GAAP financial results.
Appendix
12 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 Adjusted net income (loss) and Adjusted net income (loss) per diluted share Net loss and net loss per diluted share, excluding: – amortization of intangibles, – goodwill and intangible asset impairment charge, – PeopleReady technology upgrade costs, – COVID-19 government subsidies, net, – other adjustments, net, and – tax effect of the adjustments and deferred tax asset valuation allowance. – 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. EBITDA and Adjusted EBITDA EBITDA excludes from net loss: – income tax expense, – interest and other (income) expense, net, and – depreciation and amortization. Adjusted EBITDA further excludes: – third-party processing fees for hiring tax credits, – amortization of software as a service assets, – goodwill and intangible asset impairment charge, – PeopleReady technology upgrade costs, – COVID-19 government subsidies, net and – other adjustments, net. – 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 SG&A expense Selling, general and administrative expense excluding: – third-party processing fees for hiring tax credits, – amortization of software as a service assets, – PeopleReady technology upgrade costs, – COVID-19 government subsidies, net and – other adjustments, net. – Enhances comparability on a consistent basis and provides investors with useful insight into the underlying trends of the business.
13 1. RECONCILIATION OF U.S. GAAP NET LOSS TO ADJUSTED NET INCOME (LOSS) AND ADJUSTED NET INCOME (LOSS) PER DILUTED SHARE (Unaudited) 13 weeks ended (in thousands, except for per share data) Jun 30, 2024 Jun 25, 2023 Net loss $ (104,710) $ (7,323) Amortization of intangible assets 1,369 1,274 Goodwill and intangible asset impairment charge 59,674 9,485 PeopleReady technology upgrade costs (1) 39 174 COVID-19 government subsidies, net (2) (9,696) — Other adjustments, net (3) 1,779 565 Tax effect of adjustments and deferred tax asset valuation allowance (4) 40,855 (677) Adjusted net income (loss) $ (10,690) $ 3,498 Adjusted net income (loss) per diluted share $ (0.35) $ 0.11 Diluted weighted average shares outstanding 30,349 31,185 Margin / % of revenue: Net loss (26.4) % (1.5) % Adjusted net income (loss) (2.7) % 0.7 % Refer to the last slide of the appendix for footnotes.
14 2. RECONCILIATION OF U.S. GAAP NET LOSS TO EBITDA AND ADJUSTED EBITDA (Unaudited) Refer to the last slide of the appendix for footnotes. 13 weeks ended (in thousands) Jun 30, 2024 Jun 25, 2023 Net loss $ (104,710) $ (7,323) Income tax expense 46,491 1,345 Interest and other (income) expense, net (1,741) (578) Depreciation and amortization 7,691 6,280 EBITDA (52,269) (276) Third-party processing fees for hiring tax credits (5) 90 110 Amortization of software as a service assets (6) 1,452 952 Goodwill and intangible asset impairment charge 59,674 9,485 PeopleReady technology upgrade costs (1) 39 174 COVID-19 government subsidies, net (2) (9,696) — Other adjustments, net (3) 1,779 565 Adjusted EBITDA $ 1,069 $ 11,010 Margin / % of revenue: Net loss (26.4) % (1.5) % Adjusted EBITDA 0.3 % 2.3 %
15 3. RECONCILIATION OF U.S. GAAP SELLING, GENERAL AND ADMINISTRATIVE EXPENSE TO ADJUSTED SG&A EXPENSE (Unaudited) Refer to the last slide of the appendix for footnotes. Q2 2024 Q2 2023 Q3 2024 Outlook 13 weeks ended (in thousands) Jun 30, 2024 Jun 25, 2023 Sep 29, 2024 Selling, general and administrative expense $ 97,018 $ 121,282 $ 99,400 — $ 103,400 Third-party processing fees for hiring tax credits (5) (90) (110) (100) Amortization of software as a service assets (6) (1,452) (952) (1,600) PeopleReady technology upgrade costs (1) (39) (174) (900) COVID-19 government subsidies, net (2) 6,803 — — Other adjustments, net (3) (1,608) (390) (2,100) Adjusted SG&A expense $ 100,632 $ 119,656 $ 94,700 — $ 98,700 % of revenue: Selling, general and administrative expense 24.5 % 25.5 % Adjusted SG&A expense 25.4 % 25.2 %
16 Footnotes: 1. Costs associated with upgrading legacy PeopleReady technology. 2. COVID-19 government subsidies net of related fees ($2.9 million in cost of services and $6.8 million in selling, general and administrative expense). 3. Other adjustments for the 13 weeks ended June 30, 2024 and June 25, 2023 primarily include workforce reduction costs of $1.5 million ($0.2 million in cost of services and $1.3 million in selling, general and administrative expense) and $0.6 million ($0.2 million in cost of services and $0.4 million in selling, general and administrative expense), respectively. Other adjustments for the 13 weeks ending September 29, 2024 are expected to include approximately $2.1 million of workforce reduction costs. 4. The tax effect includes the application of our statutory rate of 26% to all taxable / deductible adjustments. The tax effect for the thirteen weeks ended June 30, 2024 also includes the $55 million valuation allowance recorded against the U.S. federal and state deferred tax assets. Note, prior periods were reported using the effective rate for the respective period and have been recast to conform to the current presentation for comparability. Please refer to the reconciliations on the financial results page under the investor relations section of our website for additional information on comparable historical periods. 5. These third-party processing fees are associated with generating hiring tax credits. 6. Amortization of software as a service assets is reported in selling, general and administrative expense.
Investor Roadshow Presentation AUGUST 2024
Forward-Looking Statements This presentation contains forward-looking statements relating to our plans and expectations including, without limitation, statements regarding the future performance and operations of our business, expectations regarding stabilization in demand, and expected growth from our digital investments, 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 presentation 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, which can be negatively impacted by factors such as rising interest rates, inflation, political instability, epidemics and global trade uncertainty, (2) our ability to maintain profit margins, (3) our ability to successfully execute on business strategies and further digitalize our business model, (4) our ability to attract sufficient qualified candidates and employees to meet the needs of our clients, (5) our ability to attract and retain clients, (6) our ability to access sufficient capital to finance our operations, including our ability to comply with covenants contained in our revolving credit facility, (7) new laws, regulations, and government incentives that could affect our operations or financial results, (8) any reduction or change in tax credits we utilize, including the Work Opportunity Tax Credit, and (9) the timing and amount of common stock repurchases, if any, which will be determined at management’s discretion and depend upon several factors, including market and business conditions, the trading price of our common stock and the nature of other investment opportunities. Other information regarding factors that could affect our results is included in our Securities and 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 references to future financial estimates are included for informational purposes only and subject to risk factors discussed in our most recent filings with the SEC. Any comparisons made herein to other periods are based on a comparison to the same period in the prior year unless otherwise stated.
Investment Highlights Return of Capital Market leader in U.S. industrial staffing and global RPO with increasingly diverse service offerings to meet evolving client needs Highly fragmented industry with strong secular growth drivers Strong balance sheet and cash flow to support future growth opportunities and the return of excess capital to shareholders Advancing technology applications and expanding in high-growth end markets with a simplified structure to deliver long-term, profitable growth Experienced Leadership Team Deep human capital expertise with proven success driving growth and delivering value to stakeholders
Our Mission: Connecting People and Work Returning Value to Shareholders 2023 Revenue (Share repurchases last 5 years) $203M $1.9B 67,000 Clients served annually with strong diversity1 464,000 People connected to work during 2023 One of the largest U.S. industrial staffing providers One of the largest global RPO providers HRO Today magazine repeatedly recognizes PeopleScout as a global market leader Thousands of veterans hired each year via internal programs as well as Hiring Our Heroes and Wounded Warriors Recognized for breakthrough board practices that promote greater diversity and inclusion All segments earned the Top Workplaces USA Award issued by Energage 1 No single client accounted for more than 4% of total revenue for FY 2023
Solving Workforce Challenges Workforce Complexity Many factors, including globalization, the “gig” economy and diversity are changing the world of work requiring a disciplined approach to hiring. Artificial Intelligence Companies are seeking ways to become more nimble and efficient Deploying AI to source human capital will be a competitive differentiator. Digital Engagement The worker supply chain is becoming increasingly decentralized. TrueBlue’s digital strategy connects people anywhere at any time. Companies turn to human capital experts with innovative workforce solutions to solve growing talent challenges A robust value proposition with high-touch, specialized, digital solutions for industrial staffing and recruitment process outsourcing.
PeopleReady PeopleScout PeopleManagement Incremental Segment profit margin2 15 – 20% 27 – 32% 8 – 13% Revenue mix1 Segment profit mix1 1 Revenue and segment profit calculations based on FY 2023. 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 depreciation and amortization expense, unallocated corporate general and administrative expense, interest expense, other income, income taxes, and other adjustments not considered to be ongoing. ² Average, estimated margin associated with additional organic revenue. 58% 44% 12% 45% 30% 11% PeopleReady PeopleScout PeopleManagement Three specialized segments meet diverse client needs On-demand general and skilled labor for industrial jobs Talent solutions for outsourcing the recruiting process for permanent employees Contingent, on-site industrial staffing and commercial driver services
7 US Industrial Staffing: A Large and Attractive Market Why Industrial Staffing? One of the largest segments of the U.S. staffing industry ($34B in 2023) Highly fragmented with no dominant competition Digital adoption by the industry can expand growth opportunity, like rideshare companies did for the taxi industry Unique growth opportunity to fill key skilled trades positions as baby boomers retire The Biden Administration’s infrastructure and clean energy plans are expected to inject billions into the labor market The industry rebounds quickly in the early stages of a recovery Represents ~30% of $640B global staffing market United States Staffing Market ~$200B1 One of the largest U.S. segments (~20%) Industrial temporary staffing ($34B) Skilled Trades On-site Hourly General On Demand Labor On-site Cost Per Unit Trucking 1 Source: Staffing Industry Analysts Note, industrial temporary staffing includes various occupations such as: laborers, packers, construction workers, skilled trades, machinists, janitors, etc.
Recruitment Process Outsourcing: High margin plus double-digit revenue growth Why RPO? Nascent market with no single dominant player Traditionally sticky business model with high client retention and engagement Industry produced double-digit annual revenue growth historically and recovered swiftly from recent recession Industry poised for growth as companies seek new solutions to increasing labor challenges Global RPO Market ~$6B1 1 Source: Everest Group Strong history of growth with a 2017-2023 market CAGR of ~10% North America represents ~50% followed by EMEA (~30%) and APAC (~20%) Further market expansion expected largely driven by first-generation buyers representing ~90% of new deals 8
Strong position to capitalize on growth opportunities PEOPLE 5,000+ talented, dedicated and mission driven people EXPERIENCE > 30 years of industry experience and deep client relationships TECHNOLOGY Sophisticated technology providing a differentiated user experience MARKET PRESENCE Significant scale and expansive local market presence Tremendous strengths and assets to drive our success, capitalizing on growth opportunities, enhancing shareholder value and advancing our mission to connect people and work
Focused strategy, leveraging our strengths to deliver long-term, profitable growth Position our contingent staffing business to compete in a digital-forward future Provide a differentiated experience with proprietary technology Drive efficiencies to optimize our reach and engagement Increase focus on operational excellence, cross-selling and innovation Drive efficiencies and bring our teams closer to clients and associates Leverage strengths and synergies to deliver profitable growth Expand in high-growth, less- cyclical and underpenetrated end markets Capitalize on secular growth opportunities to deliver long- term, sustainable growth Diversify our business to increase market share and revenue potential DIGITAL TRANSFORMATION MARKET EXPANSION SIMPLIFIED STRUCTURE
Digitally transform our business model Position our contingent staffing business to compete in a digital-forward future o We control our roadmap with our new, proprietary JobStack app o Advancement of our digital capabilities through competitive enhancements and quick response to evolving user needs Provide a differentiated experience with proprietary technology o Meeting our clients and associates where they are, with a customized experience combining the power of our technology and local market expertise o Connecting clients and candidates using AI, machine learning, predictive analytics and a superior candidate experience with Affinix Drive efficiencies to optimize our reach and engagement o Digitalization enables operational efficiencies, allowing for more time focused on engaging with clients to drive results
Expand our share in attractive end markets Expand in high-growth, less-cyclical and underpenetrated end markets o Strong position to capture further growth opportunities with a proven track record in renewable energy work o Focused growth in attractive end markets like healthcare Capitalize on secular growth opportunities to deliver long-term, sustainable growth o Well-positioned to fill structural staffing shortages in areas like skilled trades o Powerful secular forces that play to our strengths Diversify our business to increase market share and revenue potential o Targeting RPO expansion in higher skill placements and more attractive product offerings SECULAR GROWTH UNDERPENETRATED DIVERSIFY
Streamline our organizational structure Increase focus on operational excellence, cross-selling and innovation Capitalize on opportunities to leverage strengths and synergies to deliver profitable growth Drive efficiencies and bring our teams closer to clients and associates Eliminate silos to take advantage of synergies and expertise Unlock the full value of our assets Reduce organizational complexity to better serve our clients Maximize our efforts while reducing costs to enhance profitability Enhanced agility to capitalize on evolving market dynamics Create increased opportunities to collaborate across well-established brands with deep expertise
ESG principles help us make sound decisions AAA Rating Risk Ranking: Low Risk Exposure: Low Risk Management: Average Key Statistics: 78% of board members are women or racially diverse 50% of senior management are women 91% of voting shareholders approved executive compensation How ESG guides our decision making: Code of conduct and business ethics framework Board of directors oversight & governance Executive compensation structure Enterprise risk management program External ESG Ratings
Strong balance sheet with zero debt and ample liquidity Note: Figures may not sum to consolidated totals due to rounding. Balances as of fiscal period end. 1 Borrowing availability is based on maximum borrowing availability under our most restrictive covenant. 2 Buyback ratio calculated as the dollar value of share repurchases during the period divided by our market capitalization at the beginning of the fiscal period. $161 $294 $293 $86 $63 $50 $72 $62 $224 $344 $365 $148 2020 2021 2022 2023 Borrowing availability Cash *Amounts in millions 1 $52 $17 $61 $34 6% 2% 6% 5% -20% -15% -10% -5% 0% 5% 10% 0 10 20 30 40 50 60 70 80 90 100 2020 2021 2022 2023 Share Repurchases Buyback ratio2
Focused capital strategy Investing in technology and returning excess capital to shareholders 18% 47% 35% (2019 - 2023) Net debt reductions Share repurchases Capital expenditures Historical use of capitalCapital allocation priorities Strategic technology investments to further digitalize our business model Return excess capital to shareholders through share repurchases Disciplined acquisition strategy to supplement organic revenue growth
TARYN OWEN PRESIDENT AND CEO Leadership with Deep Expertise 20+ years of industry experience 10+ years as business leader TrueBlue President since 2022 CARL SCHWEIHS EVP AND CFO 10+ years of industry experience 10+ years of finance experience TrueBlue CFO since 2023 KRISTY WILLIS EVP AND PRESIDENT, PEOPLEREADY 20+ years of industry experience RICK BETORI EVP AND PRESIDENT. PEOPLESCOUT 20+ years of industry experience JERRY WIMER SVP AND ACTING PRESIDENT. PEOPLEMANAGEMENT 20+ years of industry experience
TrueBlue Highlights Mission Driven Connecting People and Work
THANK YOU
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