[February 08, 2017] |
|
TrueBlue Reports Fourth Quarter 2016 Results
TrueBlue, Inc. (NYSE:TBI) announced today fourth quarter 2016 results.
Revenue for the fiscal 14-week1 fourth quarter of 2016 was
$735 million, a decrease of 9% compared to the fiscal 13-week fourth
quarter of 2015. Net income per diluted share for the fiscal 14-week
fourth quarter of 2016 was $0.43 compared to $0.67 per diluted share for
the fiscal 13-week fourth quarter of 2015.
On a comparable2 13-week basis, revenue for the fourth
quarter of 2016 was $701 million, a decrease of 14%, or an increase of
5% excluding the company's largest customer. On a comparable 13-week
basis, adjusted net income per diluted share3 was $0.58, or
$0.57 excluding the company's largest customer, compared to $0.67 per
diluted share for the fiscal fourth quarter of 2015, or $0.48 excluding
the company's largest customer.
"Revenue on a comparable 13-week basis was up five percent excluding our
largest customer," TrueBlue CEO Steve Cooper said. "We remain highly
focused on profit margins through disciplined pricing, ongoing cost
containment, and capturing synergies with our acquired businesses.
"Our recent acquisitions have accelerated our growth strategy. The
recruitment process outsourcing business acquired from Aon Hewitt makes
PeopleScout the RPO leader in the U.S., as well as a global leader,
positioning us for continued long-term success in this fast-growing,
high-margin business. The SIMOS acquisition enhances our
PeopleManagement business with productivity-based pricing that is highly
appealing to customers."
Cooper continued, "Along with our recent branding changes, these
acquisitions position us better than ever to respond to a broad
assortment of customer needs, whether it's on-demand staffing from
PeopleReady, strategic workforce management solutions from
PeopleManagement, RPO from PeopleScout, or a total talent solution."
2017 Outlook
The company estimates revenue for the fiscal first quarter of 2017 will
range from $560 million to $575 million. It also expects net income
(loss) per diluted share will range from ($0.01) to $0.04 or $0.09 to
$0.14 on an adjusted net income per diluted share basis.
Management will discuss fourth quarter and full-year 2016 results on a
webcast at 2 p.m. PT (5 p.m. ET), today, Wednesday, Feb. 8. The webcast
can be accessed on TrueBlue's web site: www.trueblue.com.
About TrueBlue:
TrueBlue (NYSE:TBI) is a leading provider of specialized workforce
solutions that help clients create growth, improve efficiency and
increase reliability. TrueBlue connected over 815,000 people with work
during 2016 to clients in a wide variety of industries through its
staffing, on-site workforce management and recruitment process
outsourcing services. Learn more at www.trueblue.com.
1 As previously communicated, the company's fiscal fourth
quarter includes a 14th week and the fiscal year includes a 53rd week,
and the week-ending date has been moved from Friday to the following
Sunday, Jan. 1, 2017, to better align with the work week of our
customers. To facilitate comparison, the company is providing 14-week
GAAP and 13-week comparable revenue results.
2 Due to a previously announced reduction in the scope of
services with its largest customer, the company is providing results on
a comparable 13-week and 52-week basis excluding the results of this
customer to help investors assess the company's underlying results. See
the financial statements accompanying the release and the company's
website for more information on non-GAAP terms.
3 See the financial statements accompanying the release and
the company's website for more information on non-GAAP terms.
Forward-looking Statements
This release contains forward-looking statements relating to our plans
and expectations, 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. We presently
consider the following to be among important factors that could cause
actual results to differ materially from the company's expectations: (1)
national and global economic conditions, (2) our ability to attract and
retain customers, (3) our ability to maintain profit margins, (4) new
laws and regulations that could have a material effect on our operations
or financial results, (5) our ability to successfully complete and
integrate acquisitions. Other information regarding factors that could
materially affect our results is included in our 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 on our website at www.trueblue.com
under the Investor Relations section or the SEC's website at www.sec.gov.
We assume no duty to update or revise any forward-looking statements
contained in this release.
In addition, we use several non-GAAP financial measures when presenting
our financial results in this release. Please refer to the
reconciliations between our GAAP and non-GAAP financial measures
included below and on our website at www.trueblue.com
under the Investor Relations section for a complete perspective on both
current and historical periods. Any comparisons made to other periods
today are based on a comparison to the same period in the prior year
unless otherwise stated.
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|
|
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TRUEBLUE, INC.
|
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
|
(Unaudited, in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Q4 2016
|
|
Fiscal 2016
|
|
Q4 2015
|
|
Fiscal 2015
|
|
|
14 Weeks Ended (1)
|
|
13 Weeks Ended
|
|
53 Weeks Ended (1)
|
|
52 Weeks Ended
|
|
|
Jan 1, 2017
|
|
Dec 25, 2015
|
|
Jan 1, 2017
|
|
Dec 25, 2015
|
Revenue from services
|
|
$
|
734,951
|
|
|
$
|
810,733
|
|
|
$
|
2,750,640
|
|
|
$
|
2,695,680
|
|
Cost of services
|
|
554,064
|
|
|
625,729
|
|
|
2,070,922
|
|
|
2,060,007
|
|
Gross profit
|
|
180,887
|
|
|
185,004
|
|
|
679,718
|
|
|
635,673
|
|
Selling, general and administrative expense
|
|
145,387
|
|
|
141,419
|
|
|
546,477
|
|
|
495,988
|
|
Depreciation and amortization
|
|
12,019
|
|
|
10,428
|
|
|
46,692
|
|
|
41,843
|
|
Goodwill and intangible asset impairment charge (2)
|
|
-
|
|
|
-
|
|
|
103,544
|
|
|
-
|
|
Income (loss) from operations
|
|
23,481
|
|
|
33,157
|
|
|
(16,995
|
)
|
|
97,842
|
|
Interest and other expense, net
|
|
(572
|
)
|
|
(293
|
)
|
|
(3,345
|
)
|
|
(1,395
|
)
|
Income (loss) before tax expense
|
|
22,909
|
|
|
32,864
|
|
|
(20,340
|
)
|
|
96,447
|
|
Income tax expense (benefit)
|
|
4,822
|
|
|
4,696
|
|
|
(5,089
|
)
|
|
25,200
|
|
Net income (loss)
|
|
$
|
18,087
|
|
|
$
|
28,168
|
|
|
$
|
(15,251
|
)
|
|
$
|
71,247
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.43
|
|
|
$
|
0.68
|
|
|
$
|
(0.37
|
)
|
|
$
|
1.73
|
|
Diluted
|
|
$
|
0.43
|
|
|
$
|
0.67
|
|
|
$
|
(0.37
|
)
|
|
$
|
1.71
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
41,638
|
|
|
41,337
|
|
|
41,648
|
|
|
41,226
|
|
Diluted
|
|
41,980
|
|
|
41,748
|
|
|
41,648
|
|
|
41,622
|
|
(1)
|
|
The company changed its fiscal period end day from the last Friday
in December to the Sunday closest to the last day of December. Our
fiscal quarters also end on Sunday. This change was effective with
our fourth quarter ended January 1, 2017. In fiscal years consisting
of 53 weeks, the final quarter will consist of 14 weeks while in
52-week years all quarters will consist of 13 weeks.
|
(2)
|
|
The Goodwill and intangible asset impairment charge for the 53-weeks
ended January 1, 2017, included the write-off of the CLP and Spartan
reporting unit trade names/trademarks of $4.3 million due to the
re-branding to PeopleReady during the third quarter of 2016, and
$99.3 million of impairment charges recorded in the second quarter
of 2016 relating to our Staff Management | SMX, hrX, and PlaneTechs
reporting units.
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TRUEBLUE, INC.
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SUMMARY CONSOLIDATED BALANCE SHEETS
|
(Unaudited, in thousands)
|
|
|
|
|
|
|
|
Fiscal 2016
|
|
Fiscal 2015
|
|
|
Jan 1, 2017
|
|
Dec 25, 2015
|
Assets
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
34,970
|
|
|
$
|
29,781
|
Accounts receivable, net
|
|
352,606
|
|
|
461,476
|
Other current assets
|
|
40,227
|
|
|
51,708
|
Total current assets
|
|
427,803
|
|
|
542,965
|
Property and equipment, net
|
|
63,998
|
|
|
57,530
|
Restricted cash and investments
|
|
231,193
|
|
|
188,412
|
Goodwill and intangible assets, net
|
|
349,894
|
|
|
422,354
|
Other assets, net
|
|
57,557
|
|
|
48,181
|
Total assets
|
|
$
|
1,130,445
|
|
|
$
|
1,259,442
|
|
|
|
|
|
Liabilities and shareholders' equity
|
|
|
|
|
Current liabilities
|
|
$
|
251,135
|
|
|
$
|
227,976
|
Long-term debt, less current portion
|
|
135,362
|
|
|
243,397
|
Other long-term liabilities
|
|
218,769
|
|
|
252,496
|
Total liabilities
|
|
605,266
|
|
|
723,869
|
Shareholders' equity
|
|
525,179
|
|
|
535,573
|
Total liabilities and shareholders' equity
|
|
$
|
1,130,445
|
|
|
$
|
1,259,442
|
|
|
|
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TRUEBLUE, INC.
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(Unaudited, in thousands)
|
|
|
|
|
|
|
|
Fiscal 2016
|
|
Fiscal 2015
|
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
Jan 1, 2017
|
|
Dec 25, 2015
|
Cash flows from operating activities:
|
|
|
|
|
Net income (loss)
|
|
$
|
(15,251
|
)
|
|
$
|
71,247
|
|
Adjustments to reconcile net income (loss) to net cash from
operating activities:
|
|
|
|
|
Depreciation and amortization
|
|
46,692
|
|
|
41,843
|
|
Goodwill and intangible asset impairment charges
|
|
103,544
|
|
|
-
|
|
Provision for doubtful accounts
|
|
8,308
|
|
|
7,132
|
|
Stock-based compensation
|
|
9,363
|
|
|
11,103
|
|
Deferred income taxes
|
|
(25,355
|
)
|
|
5,176
|
|
Other operating activities
|
|
7,910
|
|
|
446
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
Accounts receivable
|
|
112,785
|
|
|
(89,474
|
)
|
Income tax receivable
|
|
9,450
|
|
|
(16,678
|
)
|
Other assets
|
|
470
|
|
|
(6,398
|
)
|
Accounts payable and other accrued expenses
|
|
(4,101
|
)
|
|
23,261
|
|
Accrued wages and benefits
|
|
(7,313
|
)
|
|
12,203
|
|
Workers' compensation claims reserve
|
|
11,070
|
|
|
14,736
|
|
Other liabilities
|
|
4,182
|
|
|
(2,525
|
)
|
Net cash provided by operating activities
|
|
261,754
|
|
|
72,072
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
Capital expenditures
|
|
(29,042
|
)
|
|
(18,394
|
)
|
Acquisitions of businesses
|
|
(72,476
|
)
|
|
(67,500
|
)
|
Sales and maturities of marketable securities
|
|
-
|
|
|
1,500
|
|
Change in restricted cash and cash equivalents
|
|
(19,773
|
)
|
|
18,374
|
|
Purchases of restricted investments
|
|
(37,173
|
)
|
|
(51,516
|
)
|
Maturities of restricted investments
|
|
15,248
|
|
|
12,510
|
|
Net cash used in investing activities
|
|
(143,216
|
)
|
|
(105,026
|
)
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
Purchases and retirement of common stock
|
|
(5,748
|
)
|
|
-
|
|
Net proceeds from stock option exercises and employee stock purchase
plans
|
|
1,542
|
|
|
1,563
|
|
Common stock repurchases for taxes upon vesting of restricted stock
|
|
(2,851
|
)
|
|
(3,869
|
)
|
Net change in revolving credit facility
|
|
(105,579
|
)
|
|
46,091
|
|
Payments on debt
|
|
(2,456
|
)
|
|
(2,078
|
)
|
Other
|
|
(29
|
)
|
|
1,079
|
|
Net cash provided by (used in) financing activities
|
|
(115,121
|
)
|
|
42,786
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
1,772
|
|
|
283
|
|
Net change in cash and cash equivalents
|
|
5,189
|
|
|
10,115
|
|
CASH AND CASH EQUIVALENTS, beginning of period
|
|
29,781
|
|
|
19,666
|
|
CASH AND CASH EQUIVALENTS, end of period
|
|
$
|
34,970
|
|
|
$
|
29,781
|
|
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TRUEBLUE, INC.
|
NON-GAAP RECONCILIATIONS
|
(Unaudited, in thousands, except for per share data)
|
1. COMPARABLE 13 AND 52 WEEK PERIODS
As previously communicated, the company's fiscal fourth quarter includes
a 14th week and the fiscal year includes a 53rd week, and the
week-ending date has been moved from Friday to the following Sunday,
Jan. 1, 2017, to better align with the work week of our customers. To
facilitate comparison to the prior year, the company is providing
13-week and 52-week comparable operating results. The impact of the
added work days is an operating loss of approximately $1 million, as the
final week of December is one of the lowest volume weeks of the year and
the associated gross profit is more than offset by operating expenses.
|
|
Q4 2016
|
|
2016
|
|
|
13 Weeks Ended
|
|
52 Weeks Ended
|
|
|
Dec 23, 2016
|
|
Dec 23, 2016
|
Revenue from services
|
|
$
|
700,819
|
|
|
$
|
2,716,508
|
|
Cost of services
|
|
526,858
|
|
|
2,043,716
|
|
Gross profit
|
|
173,961
|
|
|
672,792
|
|
Selling, general and administrative expense
|
|
137,682
|
|
|
538,772
|
|
Depreciation and amortization
|
|
11,160
|
|
|
45,833
|
|
Goodwill and intangible asset impairment charge (5)
|
|
-
|
|
|
103,544
|
|
Income (loss) from operations
|
|
25,119
|
|
|
(15,357
|
)
|
Interest and other expense, net
|
|
(531
|
)
|
|
(3,304
|
)
|
Income (loss) before tax expense
|
|
24,588
|
|
|
(18,661
|
)
|
Income tax expense (benefit)
|
|
5,242
|
|
|
(4,669
|
)
|
Net income (loss)
|
|
$
|
19,346
|
|
|
$
|
(13,992
|
)
|
|
|
|
|
|
Net income (loss) per common share:
|
|
|
|
|
Basic
|
|
$
|
0.46
|
|
|
$
|
(0.34
|
)
|
Diluted
|
|
$
|
0.46
|
|
|
$
|
(0.34
|
)
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
Basic
|
|
41,638
|
|
|
41,648
|
|
Diluted
|
|
41,980
|
|
|
41,648
|
|
2. RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED NET INCOME
AND ADJUSTED NET INCOME PER DILUTED SHARE ON A COMPARABLE BASIS
Adjusted net income and Adjusted net income per diluted share are key
measures used by management to assess performance and, in our opinion,
enhance comparability and provide investors with useful insight into the
underlying trends of the business. Accordingly, the schedule below
reconciles the 13-week and 52-week net income (loss) to adjusted net
income and adjusted net income per diluted share on a basis comparable
to prior year periods.
|
|
Q4 2016
|
|
2016
|
|
Q1 2017 Outlook*
|
|
|
13 Weeks Ended
|
|
52 Weeks Ended
|
|
13 Weeks Ended
|
|
|
Dec 23, 2016
|
|
Dec 23, 2016
|
|
Apr 2, 2017
|
Net income (loss)
|
|
$
|
19,346
|
|
|
$
|
(13,992
|
)
|
|
$
|
(400
|
)
|
-
|
$
|
1,800
|
Acquisition/integration and other costs (1)
|
|
4,002
|
|
|
12,223
|
|
|
|
-
|
|
Goodwill and intangible asset impairment charge (5)
|
|
-
|
|
|
103,544
|
|
|
|
-
|
|
Amortization of intangible assets of acquired businesses (2)
|
|
5,934
|
|
|
26,612
|
|
|
|
5,500
|
|
Tax effective of adjustments to net income (loss) (3)
|
|
(2,782
|
)
|
|
(39,866
|
)
|
|
|
(1,500)
|
|
Adjust income taxes to normalized effective rate (4)
|
|
(1,643
|
)
|
|
556
|
|
|
|
-
|
|
Adjusted net income (7)
|
|
$
|
24,857
|
|
|
$
|
89,077
|
|
|
$
|
3,600
|
|
-
|
$
|
5,800
|
|
|
|
|
|
|
|
|
|
Adjusted net income, per diluted share (7)
|
|
$
|
0.58
|
|
|
$
|
2.12
|
|
|
$
|
0.09
|
|
-
|
$
|
0.14
|
|
|
|
|
|
|
|
|
|
Diluted weighted average shares outstanding
|
|
41,980
|
|
|
41,968
|
|
|
|
42,400
|
|
* Totals may not sum due to rounding
|
|
|
|
|
|
|
|
|
|
|
3. RECONCILIATION OF NET INCOME (LOSS) TO EBITDA AND ADJUSTED
EBITDA
EBITDA and Adjusted EBITDA are key measures used by management to assess
performance and, in our opinion, enhance comparability and provide
investors with useful insight into the underlying trends of the
business. Accordingly, the schedule below reconciles the 13-week and
52-week net income (loss) to EBITDA and Adjusted EBITDA on a basis
comparable to prior year periods.
|
|
Q4 2016
|
|
2016
|
|
Q1 2017 Outlook*
|
|
|
13 Weeks Ended
|
|
52 Weeks Ended
|
|
13 Weeks Ended
|
|
|
Dec 23, 2016
|
|
Dec 23, 2016
|
|
Apr 2, 2017
|
Net income (loss)
|
|
$
|
19,346
|
|
|
$
|
(13,992
|
)
|
|
$
|
(400
|
)
|
-
|
$
|
1,800
|
Income tax expense (benefit)
|
|
5,242
|
|
|
(4,669
|
)
|
|
(100
|
)
|
-
|
500
|
Interest expense, net
|
|
531
|
|
|
3,304
|
|
|
100
|
|
|
100
|
Depreciation and amortization
|
|
11,160
|
|
|
45,833
|
|
|
|
|
12,000
|
|
EBITDA (8)
|
|
36,279
|
|
|
30,476
|
|
|
11,600
|
|
-
|
14,400
|
Acquisition/integration and other costs (1)
|
|
4,002
|
|
|
|
12,223
|
|
|
|
|
-
|
|
Goodwill and intangible asset impairment charge (5)
|
|
-
|
|
|
103,544
|
|
|
|
|
-
|
|
Work Opportunity Tax Credit processing fees (6)
|
|
276
|
|
|
1,858
|
|
|
|
|
500
|
|
Adjusted EBITDA (8)
|
|
$
|
40,557
|
|
|
$
|
148,101
|
|
|
$
|
12,000
|
|
-
|
$
|
15,000
|
* Totals may not sum due to rounding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4. RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED NET INCOME
AND ADJUSTED NET INCOME PER DILUTED SHARE EXCLUDING THE COMPANY'S
LARGEST CUSTOMER
Due to a previously announced reduction in the scope of services with
its largest customer, the company is providing results on a comparable
13-week and 52-week basis excluding the results of this customer to help
investors assess the company's underlying results with prior periods.
|
|
Q4 2016
|
|
Q4 2015
|
|
Fiscal 2016
|
|
Fiscal 2015
|
|
|
13 Weeks Ended
|
|
52 Weeks Ended
|
|
|
Dec 23, 2016
|
|
Dec 25, 2015
|
|
Dec 23, 2016
|
|
Dec 25, 2015
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
19,346
|
|
|
$
|
28,168
|
|
|
$
|
(13,992
|
)
|
|
$
|
71,247
|
|
Acquisition/integration and other costs (1)
|
|
4,002
|
|
|
1,348
|
|
|
12,223
|
|
|
5,135
|
|
Goodwill and intangible asset impairment charge (5)
|
|
-
|
|
|
-
|
|
|
103,544
|
|
|
-
|
|
Amortization of intangible assets of acquired businesses (2)
|
|
5,934
|
|
|
5,585
|
|
|
26,612
|
|
|
19,903
|
|
Largest customer income before taxes (9)
|
|
(705
|
)
|
|
(11,393
|
)
|
|
(5,040
|
)
|
|
(24,016
|
)
|
Tax effective of adjustments to net income (3) excluding largest
customer
|
|
(2,585
|
)
|
|
1,249
|
|
|
(38,455
|
)
|
|
(286
|
)
|
Adjust income taxes to normalized effective rate (4)
|
|
(1,643
|
)
|
|
(4,506
|
)
|
|
556
|
|
|
(1,805
|
)
|
Adjusted net income (7) on a 13-week comparable basis, excluding
largest customer
|
|
$
|
24,349
|
|
|
$
|
20,451
|
|
|
$
|
85,448
|
|
|
$
|
70,178
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income, per diluted share (7), excluding largest
customer
|
|
$
|
0.57
|
|
|
$
|
0.48
|
|
|
$
|
2.03
|
|
|
$
|
1.68
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted average shares outstanding
|
|
41,980
|
|
|
41,748
|
|
|
41,968
|
|
|
41,622
|
|
(1)
|
|
Acquisition/integration relate to the acquisition of the
recruitment process outsourcing business of Aon Hewitt, which was
completed on January 4, 2016, and the acquisition of SIMOS, which
was completed on December 1, 2015. In addition, other charges
include an increase in the SIMOS earn-out of $1.3 million, costs
associated with the exit from the Amazon delivery business of $0.8
million in the fourth quarter of 2016 and $1.8 million in the
third quarter of 2016, and branch signage write-offs of $1.6
million due to our re-branding to PeopleReady in the third quarter
of 2016.
|
(2)
|
|
Amortization of intangible assets of acquired businesses as well
as accretion expense related to the SIMOS acquisition earn-out.
|
(3)
|
|
Total tax effect of each of the adjustments to U.S. GAAP Net
income (loss) per diluted share using the ongoing rate of 28%.
|
(4)
|
|
Adjusts the effective income tax rate to the expected ongoing rate
of 28%.
|
(5)
|
|
The Goodwill and intangible asset impairment charge for the 53
weeks ended January 1, 2017, included the write-off of the CLP and
Spartan reporting unit trade names/trademarks of $4.3 million due
to the re-branding to PeopleReady during the third quarter of
2016, and $99.3 million of impairment charges recorded in the
second quarter of 2016 relating to our Staff Management | SMX,
hrX, and PlaneTechs reporting units.
|
(6)
|
|
These third-party processing fees are associated with generating the
Work Opportunity Tax Credits, which are designed to encourage
employers to hire workers from certain targeted groups with higher
than average unemployment rates and reduce our income taxes.
|
(7)
|
|
Adjusted net income and Adjusted net income per diluted share are
non-GAAP financial measures, which exclude from Net income (loss)
and Net income (loss) on a per diluted share basis, costs related to
acquisition/integration and other costs, goodwill and intangible
asset impairment charges, amortization of intangibles of acquired
businesses as well as accretion expense related to acquisition
earn-out, tax effect of each adjustment to U.S. GAAP Net income
(loss), and adjusts income taxes to the expected ongoing effective
tax rate. Adjusted net income and Adjusted net income per diluted
share are key measures used by management to assess performance and,
in our opinion, enhance comparability and provide investors with
useful insight into the underlying trends of the business. Adjusted
net income and Adjusted net income per diluted share should not be
considered measures of financial performance in isolation or as an
alternative to net income or net income per diluted share in the
Consolidated Statements of Operations in accordance with U.S. GAAP,
and may not be comparable to similarly titled measures of other
companies. Adjusted net income and net income per diluted share
previously excluded the third-party processing fees associated with
generating Work Opportunity Tax Credits.
|
(8)
|
|
EBITDA and Adjusted EBITDA are non-GAAP financial measures. EBITDA
excludes interest, taxes, depreciation and amortization. Adjusted
EBITDA further excludes from EBITDA costs related to
acquisition/integration and other costs, goodwill and intangible
asset impairment charges, and Work Opportunity Tax Credit
third-party processing fees. EBITDA and Adjusted EBITDA are key
measures used by management to assess performance and, in our
opinion, enhance comparability and provide investors with useful
insight into the underlying trends of the business. EBITDA and
Adjusted EBITDA should not be considered measures of financial
performance in isolation or as an alternative to Income from
operations in the Consolidated Statements of Operations in
accordance with U.S. GAAP, and may not be comparable to similarly
titled measures of other companies.
|
(9)
|
|
The impact of our largest customer.
|
|
TRUEBLUE, INC.
|
NON-GAAP RECONCILIATIONS
|
(Unaudited, in thousands, except for per share data)
|
1. RECONCILIATION OF U.S. GAAP NET INCOME (LOSS) TO ADJUSTED
NET INCOME AND ADJUSTED NET INCOME PER DILUTED SHARE
|
|
Q4
|
|
Fiscal Year
|
|
|
14 Weeks Ended
|
|
13 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
Jan 1, 2017
|
|
Dec 25, 2015
|
|
Jan 1, 2017
|
|
Dec 25, 2015
|
Net income (loss)
|
|
$
|
18,087
|
|
|
$
|
28,168
|
|
|
$
|
(15,251
|
)
|
|
$
|
71,247
|
|
Acquisition/integration and other costs (1)
|
|
4,002
|
|
|
1,348
|
|
|
12,223
|
|
|
5,135
|
|
Goodwill and intangible asset impairment charge (5)
|
|
-
|
|
|
-
|
|
|
103,544
|
|
|
-
|
|
Amortization of intangible assets of acquired businesses (2)
|
|
6,391
|
|
|
5,585
|
|
|
27,069
|
|
|
19,903
|
|
Tax effective of adjustments to net income (loss) (3)
|
|
(2,910
|
)
|
|
(1,941
|
)
|
|
(39,994
|
)
|
|
(7,011
|
)
|
Adjust income taxes to normalized effective rate (4)
|
|
(1,593
|
)
|
|
(4,506
|
)
|
|
606
|
|
|
(1,805
|
)
|
Adjusted net income (7)
|
|
$
|
23,977
|
|
|
$
|
28,654
|
|
|
$
|
88,197
|
|
|
$
|
87,469
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income, per diluted share (7)
|
|
$
|
0.56
|
|
|
$
|
0.67
|
|
|
$
|
2.10
|
|
|
$
|
2.10
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted average shares outstanding
|
|
41,980
|
|
|
41,748
|
|
|
41,968
|
|
|
41,622
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2. RECONCILIATION OF U.S. GAAP NET INCOME (LOSS) TO EBITDA AND
ADJUSTED EBITDA
|
Q4
|
|
Fiscal Year
|
|
14 Weeks Ended
|
|
13 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
Jan 1, 2017
|
|
Dec 25, 2015
|
|
Jan 1, 2017
|
|
Dec 25, 2015
|
Net income (loss)
|
$
|
18,087
|
|
|
$
|
28,168
|
|
|
$
|
(15,251
|
)
|
|
$
|
71,247
|
Income tax expense (benefit)
|
4,822
|
|
|
4,696
|
|
|
(5,089
|
)
|
|
25,200
|
Interest expense, net
|
572
|
|
|
293
|
|
|
3,345
|
|
|
1,395
|
Depreciation and amortization
|
12,019
|
|
|
10,428
|
|
|
46,692
|
|
|
41,843
|
EBITDA (8)
|
35,500
|
|
|
43,585
|
|
|
29,697
|
|
|
139,685
|
Acquisition/integration and other costs (1)
|
4,002
|
|
|
|
1,348
|
|
|
12,223
|
|
|
5,135
|
Goodwill and intangible asset impairment charge (5)
|
-
|
|
|
-
|
|
|
103,544
|
|
|
-
|
Work Opportunity Tax Credit processing fees (6)
|
276
|
|
|
1,410
|
|
|
1,858
|
|
|
2,352
|
Adjusted EBITDA (8)
|
$
|
39,778
|
|
|
$
|
46,343
|
|
|
$
|
147,322
|
|
|
$
|
147,172
|
(1)
|
|
Acquisition/integration relate to the acquisition of the recruitment
process outsourcing business of Aon Hewitt, which was completed on
January 4, 2016, and the acquisition of SIMOS, which was completed
on December 1, 2015. In addition, other charges include; an increase
in the SIMOS earn-out of $1.3 million, costs associated with the
exit from the Amazon delivery business of $0.8 million in the fourth
quarter of 2016 and $1.8 million in the third quarter of 2016, and
branch signage write-offs of $1.6 million due to our re-branding to
PeopleReady in the third quarter of 2016.
|
(2)
|
|
Amortization of intangible assets of acquired businesses as well as
accretion expense related to the SIMOS acquisition earn-out.
|
(3)
|
|
Total tax effect of each of the adjustments to U.S. GAAP Net income
(loss) per diluted share using the ongoing rate of 28%.
|
(4)
|
|
Adjusts the effective income tax rate to the expected ongoing rate
of 28%.
|
(5)
|
|
The Goodwill and intangible asset impairment charge for the 53
weeks ended January 1, 2017, included the write-off of the CLP and
Spartan reporting unit trade names/trademarks of $4.3 million due
to the re-branding to PeopleReady during the third quarter of
2016, and $99.3 million of impairment charges recorded in the
second quarter of 2016 relating to our Staff Management | SMX,
hrX, and PlaneTechs reporting units.
|
(6)
|
|
These third-party processing fees are associated with generating the
Work Opportunity Tax Credits, which are designed to encourage
employers to hire workers from certain targeted groups with higher
than average unemployment rates and reduce our income taxes.
|
(7)
|
|
Adjusted net income and Adjusted net income per diluted share are
non-GAAP financial measures, which exclude from Net income (loss)
and Net income (loss) on a per diluted share basis, costs related
to acquisition/integration and other costs, goodwill and
intangible asset impairment charges, amortization of intangibles
of acquired businesses as well as accretion expense related to
acquisition earn-out, tax effect of each adjustment to U.S. GAAP
Net income (loss), and adjusts income taxes to the expected
ongoing effective tax rate. Adjusted net income and Adjusted net
income per diluted share are key measures used by management to
assess performance and, in our opinion, enhance comparability and
provide investors with useful insight into the underlying trends
of the business. Adjusted net income and Adjusted net income per
diluted share should not be considered measures of financial
performance in isolation or as an alternative to net income or net
income per diluted share in the Consolidated Statements of
Operations in accordance with U.S. GAAP, and may not be comparable
to similarly titled measures of other companies. Adjusted net
income and net income per diluted share previously excluded the
third-party processing fees associated with generating Work
Opportunity Tax Credits.
|
(8)
|
|
EBITDA and Adjusted EBITDA are non-GAAP financial measures. EBITDA
excludes interest, taxes, depreciation and amortization. Adjusted
EBITDA further excludes from EBITDA costs related to
acquisition/integration and other costs, goodwill and intangible
asset impairment charges, and Work Opportunity Tax Credit
third-party processing fees. EBITDA and Adjusted EBITDA are key
measures used by management to assess performance and, in our
opinion, enhance comparability and provide investors with useful
insight into the underlying trends of the business. EBITDA and
Adjusted EBITDA should not be considered measures of financial
performance in isolation or as an alternative to Income from
operations in the Consolidated Statements of Operations in
accordance with U.S. GAAP, and may not be comparable to similarly
titled measures of other companies.
|
|
|
|
|
|
|
|
|
|
TRUEBLUE, INC.
|
SEGMENT DATA
|
(Unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Q4 2016
|
|
Fiscal 2016
|
|
Q4 2015
|
|
Fiscal 2015
|
|
|
14 Weeks Ended
|
|
13 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
Jan 1, 2017
|
|
Dec 25, 2015
|
|
Jan 1, 2017
|
|
Dec 25, 2015
|
Revenue from services
|
|
|
|
|
|
|
|
|
PeopleReady
|
|
$
|
431,388
|
|
|
$
|
436,044
|
|
|
$
|
1,629,455
|
|
|
$
|
1,625,817
|
|
PeopleManagement
|
|
257,848
|
|
|
347,688
|
|
|
940,453
|
|
|
965,331
|
|
PeopleScout
|
|
45,715
|
|
|
27,001
|
|
|
180,732
|
|
|
104,532
|
|
Total Company
|
|
734,951
|
|
|
810,733
|
|
|
2,750,640
|
|
|
2,695,680
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA (1)
|
|
|
|
|
|
|
|
|
PeopleReady
|
|
$
|
26,348
|
|
|
$
|
32,753
|
|
|
$
|
109,063
|
|
|
|
$
|
126,251
|
|
PeopleManagement
|
|
11,903
|
|
|
19,334
|
|
|
27,557
|
|
|
36,512
|
|
PeopleScout
|
|
6,589
|
|
|
279
|
|
|
34,285
|
|
|
9,324
|
|
|
|
44,840
|
|
|
52,366
|
|
|
170,905
|
|
|
172,087
|
|
Corporate unallocated expense (2)
|
|
(5,062
|
)
|
|
(6,023
|
)
|
|
(23,583
|
)
|
|
(24,915
|
)
|
Total company Adjusted EBITDA
|
|
39,778
|
|
|
46,343
|
|
|
147,322
|
|
|
147,172
|
|
Acquisition/integration and other costs (3)
|
|
(4,002
|
)
|
|
(1,348
|
)
|
|
(12,223
|
)
|
|
(5,135
|
)
|
Goodwill and intangible asset impairment charge (4)
|
|
-
|
|
|
-
|
|
|
(103,544
|
)
|
|
-
|
|
Work Opportunity Tax Credit processing fees (5)
|
|
(276
|
)
|
|
(1,410
|
)
|
|
(1,858
|
)
|
|
(2,352
|
)
|
EBITDA (1)
|
|
35,500
|
|
|
43,585
|
|
|
29,697
|
|
|
139,685
|
|
Depreciation and amortization
|
|
(12,019
|
)
|
|
(10,428
|
)
|
|
(46,692
|
)
|
|
(41,843
|
)
|
Interest and other expense, net
|
|
(572
|
)
|
|
(293
|
)
|
|
(3,345
|
)
|
|
(1,395
|
)
|
Income (loss) before tax expense
|
|
22,909
|
|
|
32,864
|
|
|
(20,340
|
)
|
|
96,447
|
|
Income tax (expense) benefit
|
|
(4,822
|
)
|
|
(4,696
|
)
|
|
5,089
|
|
|
(25,200
|
)
|
Net income (loss)
|
|
$
|
18,087
|
|
|
$
|
28,168
|
|
|
$
|
(15,251
|
)
|
|
$
|
71,247
|
|
Due to the extra week of results in the fiscal fourth quarter of 2016,
the company is also providing results on a 13-week and 52-week basis to
enhance comparability with prior year periods, as follows:
|
|
U.S. GAAP
|
|
Non-GAAP
|
|
U.S. GAAP
|
|
Non-GAAP
|
|
|
Q4 2016
|
|
Fiscal 2016
|
|
|
14 Weeks Ended
|
|
13 Weeks Ended
|
|
53 Weeks Ended
|
|
52 Weeks Ended
|
|
|
Jan 1, 2017
|
|
Dec 23, 2016
|
|
Jan 1, 2017
|
|
Dec 23, 2016
|
Revenue from services
|
|
|
|
|
|
|
|
|
PeopleReady
|
|
$
|
431,388
|
|
|
$
|
410,936
|
|
|
$
|
1,629,455
|
|
|
$
|
1,609,003
|
PeopleManagement
|
|
257,848
|
|
|
246,048
|
|
|
940,453
|
|
|
928,653
|
PeopleScout
|
|
45,715
|
|
|
43,835
|
|
|
180,732
|
|
|
178,852
|
Total Company
|
|
734,951
|
|
|
700,819
|
|
|
2,750,640
|
|
|
2,716,508
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA (1)
|
|
|
|
|
|
|
|
|
PeopleReady
|
|
$
|
26,348
|
|
|
$
|
26,013
|
|
|
$
|
109,063
|
|
|
|
$
|
108,728
|
PeopleManagement
|
|
11,903
|
|
|
11,978
|
|
|
27,557
|
|
|
27,632
|
PeopleScout
|
|
6,589
|
|
|
7,128
|
|
|
34,285
|
|
|
34,824
|
|
|
$
|
44,840
|
|
|
$
|
45,119
|
|
|
$
|
170,905
|
|
|
$
|
171,184
|
(1)
|
|
EBITDA and Adjusted EBITDA are non-GAAP financial measures. EBITDA
excludes interest, taxes, depreciation and amortization. Adjusted
EBITDA further excludes from EBITDA costs related to
acquisition/integration and other costs, goodwill and intangible
asset impairment charges, and Work Opportunity Tax Credit
third-party processing fees. EBITDA and Adjusted EBITDA are key
measures used by management to assess performance and, in our
opinion, enhance comparability and provide investors with useful
insight into the underlying trends of the business. EBITDA and
Adjusted EBITDA should not be considered measures of financial
performance in isolation or as an alternative to Income from
operations in the Consolidated Statements of Operations in
accordance with U.S. GAAP, and may not be comparable to similarly
titled measures of other companies.
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(2)
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Beginning in the fourth quarter of 2016, we changed our methodology
for allocating certain corporate costs to our segments, which
decreased our corporate unallocated expenses. We have adjusted the
prior year amounts to reflect this change for consistency purposes.
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(3)
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Acquisition/integration relate to the acquisition of the recruitment
process outsourcing business of Aon Hewitt, which was completed on
January 4, 2016, and the acquisition of SIMOS, which was completed
on December 1, 2015. In addition, other charges include; an increase
in the SIMOS earn-out of $1.3 million, costs associated with the
exit from the Amazon delivery business of $0.8 million in the fourth
quarter of 2016 and $1.8 million in the third quarter of 2016, and
branch signage write-offs of $1.6 million due to our re-branding to
PeopleReady in the third quarter of 2016.
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(4)
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The Goodwill and intangible asset impairment charge for the 53
weeks ended January 1, 2017, included the write-off of the CLP and
Spartan reporting unit trade names/trademarks of $4.3 million due
to the re-branding to PeopleReady during the third quarter of
2016, and $99.3 million of impairment charges recorded in the
second quarter of 2016 relating to our Staff Management | SMX,
hrX, and PlaneTechs reporting units.
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(5)
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These third-party processing fees are associated with generating the
Work Opportunity Tax Credits, which are designed to encourage
employers to hire workers from certain targeted groups with higher
than average unemployment rates and reduce our income taxes.
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View source version on businesswire.com: http://www.businesswire.com/news/home/20170208006095/en/
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