Volt Information Sciences (VOLT) 10 Jan 192018 Q4 Earnings call transcript

Greetings, and welcome to the Volt Information Sciences, Inc. Fourth Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. to conference like host, to now Glassen. Lasse would turn over the your I you. Thank

begin. may You

Good you and and Sciences call. afternoon, thank fiscal Volt today XXXX Information for fourth quarter full-year conference for earnings joining us

after the to Officer; Paul Financial the which Executive Officer. news On and now, everyone and issued Vice and today release, Perneau, Tomkins, are President the call should today. Chief President By Senior market Chief closed Linda have was access

on Form received in not the available SEC of release, have with you and X-K it's the Volt's If the website section Investors at www.volt.com.

it's release call measures issued to pleasure financial those non-GAAP Linda? information future included differ due let remind Litigation made Securities President call, are call, today’s Perneau. the reference earnings to in beginning SEC risks With the will a impact forward-looking of materially under variety and to that the that, to Volt's of or made GAAP that the Reform a could the you refer we discussion statements those of Act now Before speakers will our and over reconciliation results for this certain with today's be me Information on We is may you of Private condition. measures, A press of some investors. projected will operating provide Also, Sciences' filings for my believe which XXXX. useful the financial afternoon. company's turn Volt implied to more detailed CEO, the today results recent and Linda Actual factors. from

of additional progress along with discuss highlights our Officer, quarter Chief with operational Financial the have better from earnings with I are fairly on call. fiscal will the just to that heard call then about for financial weeks you some of results, four keep performance, including joining an hosted as my position. fourth from an XXXX quarter I'll thank to begin Lasse. the a a executives our details business. understanding of our you remarks liquidity me you, the fourth experienced changes we today update us you directly now opportunity hear Paul pleased had And investors taking making. provide call Thank place we for the Tomkins, some on afternoon, overview will leading many with financial our industry today's and fourth me brief our conference today, at quarter of Good significant the Volt. of ago

I highly have visit If replay you listen, would the to where link encourage a our to Investor you Relations is not chance website the yet had posted. to

in the our highlighted growth Turning line, by with to engine. North extremely to overall, At designed operations. Staffing net and significant segment's coupled results, same-store beginning which much American sales benefits careful revenue, expense delivery, collectively top to an we margin are our of resulted quarter we structure its continuing fourth service realize the strengthen robust from from more a changes organizational in to productive gross enjoyed expansion, all in improvement fourth management, income quarter adjusted

renewed year-over-year. In improved significantly on FUTA direct focus margins categories, addition, job professional business, a gross hire growth and retail on well California credit the our emphasis our same-store driving favorable as commercial basis in as on

a of strategies efforts and administrative, performance our experts dedicated designed a strides We a that Without ago. of the with executing costs also Volt a to make remain operational reduction best-in-class luster on who efforts just keenly world-class business team employees initiatives. sharp our operating focused the Volt. we same-store have dramatically quarters contributed staffing and cost improved has These attributable compared all from are the and leadership other the of on ago. This basis efficiencies group selling, of of tireless made and operational is achieving the two directly containment to doubt, to in up tremendous year restore industry

take me a the quarter progress are to fourth demonstrate results. Let evidenced we moment financial making by our as

to we last in executing X.X% that year-over-year quarter are revenue just achieved XX% to our on during seeing year-over-year two solid approximately same-store performance, decline team’s Looking consolidated strategic narrowed QX XX.X% first line current the QX QX, business during after at of success a American plan, quarters and our After North top the over And full decline this improvement to X.X% further quarters. in we and in we Volt's the helm, revenue. past gap the leadership improving have same-store generates our the Staffing a our basis. two we at a respectively, Key again, full declines even year-over-year X.X% improved is QX. of

In and in years. November of month last continued The our growth we fiscal has revenue growth are generate in of we momentum first many XXXX. time fact, revenue anticipating the would was Staffing which fourth into quarter during of for December segment the this year-over-year the the first the segment October, year-over-year generated, in month quarter, and American positive North

Here including of where middle strategic the positioned market we restructuring advantage on focus Volt first, have to organizational and are aligned our that to win, has both clearly that benefited we competitive includes, retail an areas for from the roadmap better customers. foundational elements better

And is culture throughout level that multiple enhanced distinct the organization. we operating greater third, at and a far organization with sales channels. every Second, initiated sales a have accountability significantly high-performance in

which to with performance, that the stronger profitability. be to retail flexibility. pricing higher to degree initiatives a multiple to executing revenue have In improve This addition of to clients, margin and dedicated operational are includes business teams tends we we higher sales delivery

clients During XX% revenues increased by the associated year-over-year. new quarter, fourth with retail

clients direct retail we margins. gross other fees, which The have is opportunity impact with positively hire

Act off Tax credit same-store Unemployment XX.X%, we business from increase year-over-year Our quarter, while increase during also fees efforts margins we fourth year-over-year. gross helped nearly XXX-basis the the here efforts in quarter. more expand a continue to point XX% drive or direct did a to pay experienced profitable in as our FUTA hire a And California benefit Federal to

corporate We best-in-class management on and focused align SG&A also industry to costs overall our standards. designed remain to highly expense initiatives

months, Over elimination the processes, roles costs non-standard processes, removing of efficiencies, we in past improved and through and departments. reduce been have various to able redundancies automating six manual

in quarter, the reducing administrative other and million were we fourth on by XX.X% During $XX.X successful selling, to basis. or operating million a costs year-over-year $X.X

exited, XX.X% or sold decreased and for businesses period. costs the quarter Excluding selling, the other operating administrative from prior-year fourth

in improving actions net we announced million cost total, of aligning XXXX. are and these restructuring annualized year lease This will other In in overarching resources approximately During result These overall and an we efforts anticipate efficiencies. financial our operational $X.X intended with and commitment fiscal priorities to terminations growth to optimize savings combination initiatives redundancy the related beginning with primarily of performance. the activities quarter, of business. structure both fourth included consistent changes, a business our and both additional restructuring roles to in

ultimately sustainably Although actions enterprise. are our difficult, these an become of to a essential profitable part transition

reinvest a these our recruiting and of our portion expect marketing savings launching sales expanding into tools recruiting initiatives. new We to and engine, enhancing

operational cost opportunities identify to also continue enhance and structure our to going-forward. efficiencies We additional improve will

quarter reported of income of the the quarter in year. adjusted from in On last fourth the continuing we $X loss bottom fourth adjusted to $X.X million an line, million, compared operations

up from year. In significantly approximately $XXX,XXX addition, last fourth $X.X quarter was million, adjusted EBITDA

by clear would it quarter where of that, With like to to results. is needs Paul? longer-term, these be Paul am profitability the our financial I far signs While to review progress. call now Tomkins fourth who from turn will over encouraged I Volt's

status provide improving of compared will We details as Today, I additional our structure quarter year-over-year continued in afternoon. declines Thanks, pleased the the liquidity Linda. in our quarter, which and Good cost position. revenue results, financial our provide fourth progress our as quarters. were demonstrate last a with several as with on to results well

Let's now fourth the to results. quarter turn

the the in our This American Staffing and other Revenue the which the from contingent revenue a million, $XXX.X exchange, million. provides foreign $XXX.X company of and American in as of the of XXXX, driven was $X.X company the basis, quarter, by basis. staffing, North basis. total a X.X% $X.X quarter a which quarter, American segment year-over-year X.X% at businesses a of a game segment, $XX Our impact the in declined quarter $XX.X basis. of represents compared declined was year-over-year On on same-store sale basis. segment improvement Staffing Staffing significant the down million year-over-year revenues million When the business X% in Staffing end testing fourth decline in million. direct representing year-over-year well North prior-year revenue services on the decreases the employment XXXX sold third International North as on on reported The in fourth a the fourth of excluding $X.X total revenue fiscal and of or primarily with quarter million revenue X.X% million declined spectrum placement, a was broad or

sold. a lower favorable company higher points of business. for claims, gross driven As XXX within better of Staffing adjustment, on margin talent, Linda seeing North indicated, direct definitive a Improvement adjusted improvement realigning improvement of strong by businesses and year-over-year, in a bringing customers the as a in mix basis California we both was the top focusing in and result existing The retail compensation XXXX fourth quarter hire, business. team, are organization XX.X%, the of and margin worker an was margin the and revenue industry margin Total American FUTA

Linda year-over-year all directly costs operating focused administrative we and attributable SG&A Much from reduction efforts productivity business, in XXXX. including improvement other efforts business continue indicated, and to of improving selling, excluding and As XX.X% in additional cost to costs costs ongoing our the reduce identifying the businesses remain labor benefit We sold. gains. with additional opportunities cost our to areas is throughout of on our reduction lower consulting year-over-year,

thus basis XX% $XX annual fiscal on will costs of in least a year XXXX, the at fiscal fiscal and excluding far, of million impact sold SG&A year result taken or with XXrd XXXX. have a comparable XXXX, these As businesses the week actions eliminated in we of

from improvement continuing reflects we $X.X reductions. improvement plan, adjusted million we revenue total year-ago Loss EBITDA restructuring excludes including our compared period. $XX.X the of fourth impact strategic operations we million million XXXX. year. our on decrease the was On positive to the was assurance impairment American special quarter the and gain compared a margin $XX to company due business our the in to during the last the Adjusted was basis, the for quarter, quarter adjusted quality primarily across million fourth The in of from in an sale year-over-year of items, the North up year-over-year quarter expense during positive as was charges. the $X seeing from EBITDA the during the the in income an profitability The and Turning of success quarter execute continuing net the million in from $X.X early the quarter progress fourth loss $X.X adjusted Staffing fourth operations including in XXXX. significant of million $X.X of segment, prior-year demonstrated board quarter, reporting continuing significant to growth period. operations million fourth are This

in reductions. gross to as income expense year income ago. was of fourth margins operating Staffing of nearly million Now, $X.X by Operating segment let's a On a compared income improved up when our results. move sequential operating our North $X.X continued quarter, our quarter a with American the on and million operating improved in segment both XX% result basis, $X.X million

continues improving in our these strong line, was top While including income done, strength $X international contributor be business there quarter, much we to million, and about to be on feel work compared in during business. as Belgium year-ago to continue to slightly its our the very Staffing the period. is the segment still the International look we both results. our up hire bottom Operating progress to direct good a

outsourcing. on our efforts also as in to Operating to and disclosures, workers, $XX solutions fourth as and at in the up at we the in fourth was North will contingent previously part gross business, income improved included X.X% $X.X recruitment of North the margins. the of going quarter transparent procurement which our the XXXX, service American of liquidity compared of and respect more and liquidity, our reporting fiscal American forward, position, global with onboarding MSP the other. managing corporate a to our As of MSP end With this payroll consists in a increase, million the we well in process financial be be total quarter, end quarter to business had million quarter. from prior $XX.X MSP million, was primarily quarter our due of

availability. in Our at fourth liquidity in in end global of $XX.X comprised borrowing cash million million the the $XX.X banks quarter of and was

of to securitization work we to Although XXXX, Subsequent levels. revise Linda? additional effective Bank with and believe, company. financial certain the our January will and With operate remain provide liquidity to optimize our DZ our increase covenants, XXXX, to our the to let extend back amended to continue the to quarter, with flexibility our current we base the hard that, program liquidity sufficient which our term available lender Linda. to me the turn business, overall to to facility, XX, X, levels call of we January continue borrowing

quarter our revenue turned Thank What the the making and North in the in revenue positive enterprise-wide is quarter growth month curve progress business you, last is we financial in in clear metrics. in from many the of fourth segment. American Paul. we largest have achieved results we fourth realized Staffing that We the are

engine results been organizational the new level see of improvement in to plan far the and at our believe sales our the that every and realizing are organization. in instilled of continue QX the structure, sustainability greater ongoing of robust accountability XXXX. our We We has early

positive enterprise, also margins gross grew mentioned in important, expanded As year-over-year. as year-over-year. we this achieve our year-over-year expect margin earlier, growth Across gross segment QX. revenue dollars, for the Equally to

positive We proud quarter. what at the team adjusted expenses period continued carefully am achieved continues to Momentum for company-wide I to accomplished manage of short extremely continuing from and build income Volt. of we in positive and operations very a time. has EBITDA our

of I dedication, and near we're strong and our persistence of driving time the Thank shareholder as financial in execution right and look move forward on results work. hard your past you Our attention are I team's the performance, this our long-term that and awe am continued to operational we for quarter strategy, track evidence forward. enhancing the value and today. in and

open up like call I would questions. to for Operator? Now, the

from Whitman you. Please Benchmark [Operator Instructions] ahead. from thank question is Great, Our Capital. go Richard first

a net-net Yes, current share? share, company minus liabilities Paul, is my current $X.XX is of current equals debt arithmetic the assets a long-term minus that the – correct that's liabilities $X.XX

a take will that, so. I I Yes. at closer Yes, believe look Richard, but

thank you. Okay,

Sure.

Taylor question JRS. Ross here next go Our from ahead. Please from is

It's company us to say, professional talked going as show to can the Are through operational First what should the – of the to that – what the continued actually for first all, quarter we of is numbers. be revenue years improved margins management. continued revenue great shall going growth, suffered to see less we running drive do at help you you've idea that a about how it kind a who professional you of, or nice growth continues? few is those expect show this level and of benchmarking than margin

Yes. Hi Ross.

with I'll things. of couple a start So, revenue the growth.

positive growth expecting Staffing revenue a in are North our We American segment.

QX quarter in. QX When bit at QX, that that given So, where are confident margin, little we we are our a is of volatile look a reset. taxes includes gross for all January

of UK, is that only Volt, lower which the second coming impact. off in International. a margin is of of business, the level, typically our in our areas may gross margin answer been a terms is that question now be to from you quarter of is past, in this has – see largely in economy International and of aware, due I'll simply of and margin largely QX, instability we of challenged as business. causing Brexit a business which sort to got International, one the all are competitors the majority we The as being So, we've not slow. in the QX, right largely professional but higher

you confidently that that everything that and QX. What to impact plan margins certainly that we So that gross operational can our is for tell we that us will our doing minimize to drive can within and are anticipate is initiatives impact. I we us impacting within and strategic

We laser have direct key are for we focused that is – hire, us. on

help deal on of gone we the regardless laser pricing we we've some pricing on increases every our market that costs. us appropriately get out recruiting and to that are discipline, to single ensuring which laser price for, are increased We focused ensuring our recoup are that will we focused of size on

and have what's real idea drive the with is in talk America might what impact in that at America quarter, forgetting away about been Brexit going forward? the the Brexit roll Can – going margin to has we failure on the going you this first in you see North do as you North Stepping can company Europe, North from on looking with - America. issue

Yes.

So, I positive in as many, growth, expect years. quarter in North will again which we haven't we a mentioned, year-on-year again many that for I America, seen full revenue QX, see

the see taxes will in impact to the the from January. margin of We gross reset our

will occur. that So

we seeing However, contract our both as business. our are underlying business, in retail as growth well

will help didn't that offset. that offset, So have necessarily to in the past we where

one vote. and a I steps I Board know this much number know all, on he that unorganized, then the number to like still I'd clearly shareholders got that anger, substantially see of to no can't resoundingly. to deal I of against I sits will Chairman a love Okay. – no to would disappointment speak in so very uncontested organization, of frustration, I the And yet an to I in election sore fair less Board know than cast that I and comment. when just former is say and a voted the opposition implement make every of point of voiced but the shareholder shareholders an the He votes to holders. with talk them the was great and talk majority take – the There's we

has shareholders But of we you. certainly Board I going to heard you heard the So, thank have are certainly that. accordingly. the and the that respond for believe voice

is from that want distract I and that What team. and We great results have the do heard loud the had to the you have we've just don't certainly clear. results of

under certainly So, that be I sure will Board takes that the consideration.

I really years something process time the last time want a first I have in in the two on. period great, staggering mean And think say, in or actually sense. you going done job. a think it's now days I in stock. to good the staggering, quarter had It's where haven't thing I you you've insiders operational is turnaround can of that a short And excellent the an buy pretty

commit insiders actually seeing look So, to Thank capital to free congratulations, and you. we too. stock to forward the finally

Ross. you, Thank

no the floor like [Operator management to Instructions] If closing back I'd to questions, turn are any further comments. there for

for attention. and your you all Thank to your of all all phone. time of our hard employees much on support you Thank for all work and dedication. Appreciate your of very of the

Let's March. you we in forward to positive the up keep look momentum, again and speaking to

today's concludes This teleconference.

You may time. at this for Thank participation. lines your disconnect you again your