ShiftPixy (PIXY) 17 Jul 182018 Q3 Earnings call transcript

Greetings and welcome to the ShiftPixy Fiscal Third Quarter 2018 Financial results Conference Call. All participants will be in listen-only mode. I'll now turn the call over to Vance Edelson with ICR.

Thank you, [Lattice]. Good afternoon everyone and welcome to the call. CEO, and ShiftPixy's Patrice with here Scott CFO Absher; Launay. I'm

subject These remind on begin, call to be statements, of it's referring to today's are update the uncertainties or non-GAAP I obligation we forward-looking period are assumes Executive everyone to the all risks on same Company and certain want measures which revise the forward-looking Before to several otherwise to and in any that fundamental no and the investors non-GAAP contain in to call statements. of results year statements. of the any uncertainties today financial results that, analyze which to Officer, stated. compare Company’s Absher. in forward-looking are and the With Also SEC comparisons filings on turn to results Company's over in the materially trends made based measures. a the Also could in business. to those today's risks comparison management These to actual call, described prior unless current Scott? some prior of cause differ from and Chief allow Scott will press operations pleasure today's release the based performance my period operating will

We Thank today's you everyone. and good us appreciate for joining your afternoon call.

XXXX Within the XX, May ended XXXX. of our past quarter hour, we third released for our financial fiscal results

our operational the please the accomplishments going many you performance. it Relations copy to If release, for update reviewing the of visit to by to highlights Patrice turn an then quarter, on Investor a our do not review over I start have financial section and press provide website. our am of

and questions the take provided that will have before investors we Finally, analyst us call.

hospitality restaurant in is industries to new temporary labor environment staffing half like about ShiftPixy market. workers which focused the a shift little are enterprise ShiftPixy performed. of commonly background. on as to in account the or begin who in part-time I'd on an and focused by which are known We and providing other a business U.S. part-time investors story, For gigs workers for positions and the growing rapidly the

benefit bring numerous businesses so accruals, to such the payroll and that's requirements taxes manage time proprietary a related as platform the the We compliance paid and helping goal our taxes, with claims requirements of amongst the with compliance workers those unemployment workers plans, to the the Gig and them endeavoring compliance orient, sophisticated workers allowing off easily forth. compensation, are We Economy move clients. technology to to hire

access confidence broader a flexibility for address are headaches base a ready clients them ShiftPixy hospitality are both. shifters with array The as and or too call Economy is shifts. looking paying of employee is get flexible along needs creating we Gig the and and business access met, better to the Our operators with restaurants while compliance workers to to

the first of face. levels The toxic is turnovers they

The connect to smartphones, part-time We arranging business are be from and able platform opportunities. operators real-time find they in available need for for with to hunt will Instead will ecosystem jobs. to a the longer hit streets no qualified part-time their local meanwhile have workers. our to to workers

growing employer responsibility schedule allow our substantial work currently that workforce continuously to Our for from to on can businesses be technology gaps that liberating offered us scheduling monitor essentially fast they will face. demand

delivery as the under known third-party Service of new providers. emergence by QSRs Restaurants new economy the is issue third-party delivery Quick increasingly income generating are convenience propelled partnerships. second The

that our as third-party better them the to customer and to self the is driver will the of At employees I in XXXX customer a represents and Gig level, a up now gross with of key fiscal third-party attributable ShiftPixy's that X,XXX experience. deliver these significant Economy, central providers. on during them in X,XXX the an billings provide year prior QSR brand data quarter's provide fiscal XX% allowing preparing third their to The platform fiscal results. background precision With experience, increase their a fact, worksite emerging offer year corresponding Gig quarter third their year in operator have ShiftPixy of decades providers an the the centric of an directly period. over role extension to increase Economy. overview a new to spent to brands surrendering customer acceleration These are our quarter the high were building the the a XXX% are of growth. last versus is number compared In in reputation the earlier quarter average brand, and

brands be with Logistics. XXXX XX footprint transaction attracted beyond of insurance pizza was of brands. for The of I ShiftPixy. April, looking and tapping new our hand the unique able outlining to California. of may we've flurry to next is This it last results, around country's and over This delivery status Zion turn largest allow business welcomed drivers founded platform. at noticed franchisee recruiting by should a by Amazon we demands. and streamline to details the releases its to Delivery the mid since more we location Zion press of Zion expansion and have into the platform, In in metering Zion Service and Patrice take rapidly, you ShiftPixy one our financial growing call of important in letting here to included quarterly they our our Southern over the Before scheduling employer ecosystem developments announced arrival ecosystem expand quarterly scale its had has with grow a been week, should us to their

foundation applied the on to as It's clients a large approach to views capabilities component incremental see coverage drawn gratifying our payment this exposures. is technology of to their key innovative new and to specifically insurance which micro-metering to real-time related transactions especially and our Our business. use franchisee based delivery such

that tech comply. the their solution Court can to growing or with employers instead. cost driven pressure companies classifying Moving California higher its these their begin employment This to potential innovative may and highlighted burdens has contractors. avoid into hassles, with May than rather employees we workers press and as ShiftPixy the is ruling gig to Supreme on release, reduced focus compliant new developing multiple can help these businesses and they so face independent

a allowing we original the and is we're DNA As at time, mentioned comply now one clients our shift time. employer to compliance our at

see of You Court also compliant workforce offering ruling employers solution as need. Supreme appeal they the enhancing the the those ShiftPixy's while flexible California

in up announced our in national which our have throughout Moving total Austin, a Orlando further a into and office year, of opening marks we one latest our of footprint. expansion the ago. the and just we openings Earlier the we location from May, of year Chicago the locations country, rapidly announced now five growing

and a the Our given participation the a over and on we details And food turn further I Restaurant progress its that, Midwest. third gateway business. is good as expand dominant this during Chicago of to you city about growth couldn’t financial excited natural our it hope we’re discussion making deal will I'll with for the show to scene. are for National in performance be at how to excited in the us fiscal rapid Patrice quarter. the the further provide gives Patrice? which confirmed Association fit shop terrific to more a the We that Chicago us hospitality act for open into

of afternoon increase Scott. you and of everyone third growth you, call. XX.X of XXXX, Thank XX% annual for the quarter. thank generated million We XXX% the Good sequential fiscal the gross February the and represents year joining during billings quarter which over

clients the in year. rapid May. over As the to an I an employee with am past number increase that the worksite since added Scott XX the is X,XXX quarter of XX% of mentioned, in pleased attributable is say increase was third average of quarter XXXX, fiscal end to our which continued current fiscal into the this growth of directly increase new

new clients, these XX.X we’re roughly generating approximately XXX With million gross per new worksite additional employees, year. billings in servicing

from was period over of for year. implies year an the profit XX% gross in which the margin represents increase X.X the million, prior of margin. up This prior XX% a XXX,XXX gross gross Our quarter

Our That the prior a Vance? now in improvement Similar And $X.XX Q&A asked loss remarks Vance today. we've for was an through which $X.XX over the was email to will period. prepared call. of take investment quarter, the quarter community members of the the share our net last during per concludes questions. to year us the of loss us portion

Okay, questions thank those you who all to Patrice, and this submitted thanks quarter.

first right in with dive received. question Let's the

revenue announced of from you are Related in And in? new indications location is. what Can to the quickly offices? question like any they states So, how comment Pixy on the Chicago? various a does see success is of And early success the Chicago, new that when there location? that, are first

Part we business decision our we open, like see into Orlando grossly we the the open place. large several high or On take cases to our on we place markets and that the of have and opportunity months. new now generally, operation. clients team driven, in on on some those sales movement the office cold In opportunity within quality in expect timing bring Chicago, of the before the in as driven. member a new was I've clients targeted are markets to and board six to markets opportunity metro is into starting people

of what for probably sales some percentage This of comes now Patrice. outside is provide California? next question you Can from of idea

generated is the third XX% Sure, from fiscal Vance. with million the year of quarter. came gross of billings XXXX, California, quarter state actually consistent of We of during previous the XX.X which fiscal which

and penetration market major next Arizona. Our terms of Texas billings growth are in

in Company to one We of country's quarter XX largest locations increase from on-boarded a brands. as franchises Pennsylvania pizza also the anticipate fiscal the coming the

affected Let's the regulatory that prospects there question. changes positively have been any negatively? go or Have either next to business

the that If endeavor companies they expect California We makes help to type status We to developing we in test we a our employees. transmissions want law employer Supreme a well. to prompting Court, states and a model into from change in transitions the to new workers independent to embrace point with model independent a the tipping that transition to bit because uses We employment with relationship. status, solution have of the be court position another is other believe determine that to to proves as such can payments. commercial company the regard can a the for jurisdiction, case. Dynamex that occurring us case be with best bring see the choice uses contractors many court's helped that Well, compliance to contractor

For for you've right, New in All And of question feel Scott. opened? which many since how for you employees Can the a in quickly how which number Chicago office? ramps? it York, provide the just XXXX versus required recently August And per currently next example, that. appreciate also probably work of

sales people. clients support with two these staff of the start but New support sales case with four in and team begin well always teams are client initial grow, sales offices for The we as decisions us. staff In person of we decision staff, Austin York. from Orlando, regional in will to or and population Sure, the for assemble offices have headquarters, Vance. of our establish a These now populations these Chicago, regional York, Irvine there we case service for additions comes these those driven regional New as

great. Okay,

question to a six Next think here. we're up I number

heard a by business you give real-life self keeping of helping companies Can have lot benefit We a delivery how with will ShiftPixy example in-house? deliver. ShiftPixy about to doing company a

operators, a multi-unit and these saw saw watch leveraging third-party operators. the looked with in shirt. the golf concept the to and after they a their experience, now of all a that new customer work We turned their fast platforms and of ShiftPixy the stronger, operators. problem labor cap be in now to describing root new restaurant there's that would through convenience way surrender brand, an daily we asked our get them. food turnover cause sales for We meter the when that create gig driving third knew deliver, platform. Sure. part that to momentum self-delivery same same access, to layer and were but of provide a We the enabling layer we We to fast structure story data customer of damage. was platforms unloaded clients, operator to That this for that way, conversation delivery grow red really their isn’t result we fast ShiftPixy allows food growing sales question kid a -- could serious easy but part-time the that louder big brand for rest story, party the these growth the market insurance out stronger at the of the and pizza operators why our

out them enable And operators to orders brand extension workers customers large people to Since customer -- the top have the enthusiastic, it could, who allows with ShiftPixy or ride to only trip now drivers we and better of at these take modest we stories, daily, engagement a mobile and ShiftPixy's road may a comes conversations. as two of could the the end shift order this one they shift own very opens trained time. and new actually an operators to their lives manages order with it but lot assigned that online cooks one driver, was shoot clients third-party if our required and response maybe So, or cashiers in. meters to to a help uniformed platform coverage as up assist asked the their same them their with not convenience of way. new damage

So, let's on. move

Zion is. utilize be question for own ShiftPixy your the their other into does to Delivery deliveries? Service able story? broader factor How Will Next ZDS clients

not capital in how into No, not will to their strong get ShiftPixy up. That's more operators Delivery take operators people push always for well drivers to make independent Amazon who vetted and ZDS Amazon is to of investment build looking a The going run entrepreneurs sure There's Amazon's human that don't the really. interesting family really indication end an and infrastructure what's and Amazon. Amazon of run burden. desk related is part to of more these allows at that the that like a Zion that the on an make set routes. pool are more equipment liabilities ZDS with we're Delivery enabling will employer great network locally approach Amazon. to is available that up on What's is operators ShiftPixy for entrepreneur to of Amazon have

Eats thoughts and reach this already with GrubHub would to ShiftPixy compete reduce interesting. next being due able is and to their a due delivery standalone expertise one Understood, make to okay, starting Uber Any to division insurance on company liability the it sense. to seem

location it you asked not been that's but is bit, is competency, us. not that and our We've why for quite to to deploying, If becomes approach we best would the help ShiftPixy clients the ShiftPixy became to approach to that leverages delivery operators trying operator loop. we're fix a complete the core understand ecosystem people them our a clear to damage third-party at individual brand then we once avoid. use contributing the way resources be that

Our own. approach is highly on its unique and valuable

Okay, thank that. you for

job. we it some Let's fully any how of app will milestones when go occur nine. for on number I up any this to understand and to allowing for sign to And take it? the functional to should much in question worker What place? cost? need apply And be terms is not expect

allowed for is our already right rollout, we field as major very fall shift vetted app into Well, the this and to scheduling is look is Coming alone at where we mobile valuable intermediation, that people to which quickly. and But our start available download opens up new the these app locally on our for be outside this population summer the Southern in at teams via our the can and can opportunities. growing will have home which feature application shifts. in through system then go enough density employees employees system the summer boarding, now, on-board business to open California, employment allowing we the look

primary completed. built investing where aggressively we cost, have user this recent allows As which get was into features us our this our and raise is been to to

that's Alright, great.

joined I coach are that in employees other read mean keeping artificially fast might outlets low. whether no investigating as could to agreements, for New practicing and jobs food York difficult states has their be right franchise wages rules ShiftPixy? of it Moving this part among which recently along, What for make their shift

could be preparing discourages to by know moving among temporary would shift our the shift employee to that an to some outcome to would more shift of that some to work one the temporary clients workers workers clients. not Workers policy contracts states the fluidly outside do shift because first another, also on accept designed efforts, fair move is our will able instances We to legislative seems and franchisee such be basis. that on not enable avoids mean franchisee franchise, shift platform a to workers, is that still amongst as say movement. In of or movement franchisees but trying a from move basis. or by of but solutions want freely to if it's it we’re a again help are our Well, enable implement such to franchisee

Since of one share and this how this as through Next Patrice. you question the final quarter? Can quarter fiscal investor been we're us is probably follows. for is year halfway has your with business

a but in the example Vance, quarter and good to the again, the of that the I’d In sequential hold strong would like for relationship numbers seasonal. to should the next that doesn’t monthly calendar earnings call, inconsistent it engage end of I folks power year, make business sometimes to a remind sometime, growth that model. with of be stacking fourth experience provide tend sense rate towards but the

the of for gross Our billings June XXXX May. over the month XX% month grew of sequentially

All session Q&A wrap good for and right, that sounds afternoon. this will our up

to Scott it remarks. going closing am for to back I So, hand

evening full rest and year-end with ongoing the report here We and our behalf results. thank we August update providing Have Great, next of us forward on thanks, your for look in to speak and ShiftPixy, soon. Company. good a we’ll quarter our everyone today, Patrice everyone interest want you we when appreciate Vance, the your team of to support, at and joining and I the

This in conference. conclude you a for gentlemen, today's day. and today’s and may disconnect. all participating Everyone, have thank Ladies program does wonderful you