TrueBlue, Inc. (NYSE:TBI) Q3 2023 Earnings Call Transcript

Now, if we take a look to the middle of September through the third week of October from a sequential perspective, run rate perspective in our staffing businesses. All of those were ramping up as we would expect with historical standards. So you saw in some of our prepared remarks in our press release that we’ve seen potential signs of stabilization. That’s really what we’re referring to. So we’re encouraged by that. We’re not banking on it, but we’re encouraged by it. And that’s kind of the latest from the most recent trend perspective that we can share with you.

Kartik Northcoast: And I know you mentioned some of this already, but curious on demand by end market. I know you already talked about a few where things are warrant progressing, but then you also said you had a couple of where things were going well. So just thoughts on the end market.

Derrek Gafford: Well, yes, the question had come up, I believe Jeff had asked it, kind of asking about guidance and kind of what had happened in the quarter. And so that was the explanation of that. And so I think the main takeaway is, what we’ve seen in the stabilization of our trends from a sequential perspective. Really, all of those are looking good with the exception of retail. We’ve actually got some that are performed a little better than we expected, most kind of at expectation. The one call out if we wanted to go on the negative side would be retail. That one continues to weaken, but we’ve got some others that are strengthening and enhance overall really the sequential trends are right in line with historical averages.

Kartik Mehta: Perfect. And then just one last question. As you look at your segments, and you talked a little bit about the staffing business being down about 14%. Just expectations of the other two business as you look at the segments.

Derrek Gafford: Yeah. Well, if we’re talking about the fourth quarter, I’m just going to go off midpoint. We’ve given ranges but to quote less numbers, I’m just going to give you midpoints. So the midpoint of our outlook for the fourth quarter is for the company to be down about 17%. That’s 15% for our two staffing segments, PeopleManagement, PeopleReady and about 30% for our RPO business at PeopleScout.

Kartik Mehta: Perfect. Thank you so much, Derrek. I really appreciate it.

Operator: Thank you. Our next question comes from the line of Marc Riddick with Sidoti. Please proceed with your question.

Marc Riddick: Hi. Good evening, everyone. Just wanted to first thank you for everything in all of your assistance, Derrek, over the years, and certainly looking forward to moving forward and hope all goes well — that you’re looking for there. And I did want to just sort of touch a little bit on revenue mix that you touched on in the prepared remarks. Maybe you could shed a little more light on the renewables commentary and the sort of the pass-through effect and how that sort of plays into the revenue mix impact? And then I have a quick follow-up on cash flow.

Derrek Gafford: Yeah. Well, when we’re talking about the renewable space, that has been a bright spot for us. And so if we’re talking on a year-over-year basis, renewable energy for us was up about 80%. And so that’s continuing to be a really strong dynamic for us, not just on a year-over-year basis, but each quarter sequentially, we’ve been building some run rate there. So our renewable energy for the third quarter was about $40 million in total.

Marc Riddick: Okay. That’s definitely helpful. It seemed as though there would have to be a nice gain there to have that — have the mix impact there. I was wondering then if we could sort of follow up on cash flow and cash usage prioritization. I know certainly that having a clean balance sheet in challenging demand times is certainly very advantageous. Is there anything that we should be thinking about as far as internal investments that are on the horizon for the digital capabilities or is there anything lumpy that we should be thinking about as far as any potential needs in the coming quarters?