Resources Connection, Inc.

Q2 2022 Earnings Conference Call


spk_0: that afternoon ladies and gentlemen and welcome to the resources connection a conference call at this time all participants are analysts and only mode later we will conduct the question answer session and instructions will follow it that time if anyone should require system during the conference call please press the star key followed by the zero button on your touchstone phone and you will be connected to an operator who assisted as a reminder this conference call is being recorded at this time i would like to remind everyone that management will be commenting on results for the second quarter ended nov twenty seventh two thousand and twenty one a loss or for discern nine get financial measures an explanation and reconciliation of these measures to the most comparable get financial measures is included in the press release is
spk_1: you today
spk_0: today's press release can be viewed in the investor relations section of our gps website and also filed today with the fcc also during this call management they make forward looking statements regarding plans initiatives and strategy than he anticipated financial performance of the company such statements or predictions and actual events or results may differ materially please see the risk factors section in rtp the court on for ten k for the year and it may twenty eight two thousand and twenty one for a discussion of risk uncertainty than other factors that may cause the company's business results of operations and financial condition to differ materially from what is expressed or implied by forward looking statements made during this call announced in the call over to our gps feel take the shit
spk_2: thank you operator and welcome everyone to our second quarter earnings call thank you for joining the though i'll cover for topic starting with a quick review of our outstanding second quarter results have been discussed market trends supporting our sustained performance what we've done the capitalize on the trends and are favorable outlook for the balance of the fiscal year i'll also provide an update on our hugo initiative and close with the introduction of our newly established advisory board during a q one call we guided toward twenty four percent growth year over year and i'm very pleased to say that are result three them stronger revenue with again the highest achieved in over ten years with thirty one percent growth year over year the growth was delivered in both professional stabbing and project consulting and was delivered across nearly all geography is our health care business grew by twenty one percent year over year and the strategic client account program grew twenty seven percent over prior year quarter and both have strong deal flow in the pipeline or adjusted ebitda doubled versus the prior year quarter to nearly twenty five million and are adjusted ebitda margin improved the twelve point five percent this accomplishment as the result of driving sustained revenue growth creating an improved fixed cost structure and expanding our growth ma arjun we've worked hard to increase the profitability of the business by driving greater sales productivity and operating efficiency our focus on shareholder return includes delivering load amid teen adjusted ebitda margin while also making the appropriate investments in the business to drive topline growth over the long term i'm we remain optimistic about the balance of the fiscal year at present to tell when they're providing more business opportunity than we have experienced in over a decade first the great resignation or talent reassessment has caused many of our clients to experience skills gap or temporary openings in critical operational roles that we can help fill to allow them to bridge the gap to permanent hires gps model is increasingly attractive to professional talent the want more choice transparency and flexibility in their work this business model is absolutely built for today's knowledge worker the second tail when is the growth of project and initiative in our client base emerging from covered lockdowns many companies has accelerated transformation projects which provide growing opportunity for agile hamlet model we are staffing and co executing change projects related to finance technology and digital supply chain and compliance transformation often these projects also require program project management expertise and change management support which are core competencies of our consultant base our client base largely the fortune one thousand rely on earth for agile talent support to run the place and change the place neither business challenge show signs of slowing down and because we are a trusted partner with a reputation for quality talent an outstanding caught by and service or pipeline is stronger than ever we're not however simply relying on a balding and favorable trends we've recently executed the following initiative to be ready for these papal bull market conditions we've really engineered our sales process organization and account strategy we've revolutionized are delivery strategy to be borderless to ensure clients have access to the best talent and our talent have access to the best projects regardless of geography we've redesigned incentive compensation with a book with an employee recon aligned with shareholder value we've developed technology and digital consulting capabilities to address her clients most pressing need an we built a new digital pathway for stakeholder engagement the secular tail when coupled with the operational improvements we have made create a total operating environment for our gp next than happy to provide an update on hugo the digital winkle gauge meant platform we launched in october in the tri state market to allow finance and accounting professionals to find good work in a digital world we've launched with a pilot approach for a designated said of clients and finance and accounting rules the functionality of the platform is working of plan or engagement with both callen and clients is growing as plan and the early feedback from engagement with you though with very positive with all stakeholders from clients to tell him to rgb gp users describing the ease them fluidity of the designs and interaction thousands go far this early feedback is a good indication that our investment in patients in building an enterprise grade architecture built that scale is the right strategy in this rapid the rapidly evolving competitive landscape currently we're building more inventory in terms of register tell on on the platform and will be driving additional klein engagement during the second half of the fiscal year with targeted go to market and marketing activities this is a new pathway for engagement with our clients that will deliver results and returns for the business for years to come as technology disruption in the human capital industry marches forward we believe we are first to market with a fully self service platform for professional knowledge workers who want the benefits of gig as well as the safety net and community of an employee employer relationship our team continues to plan for investor day at the nasdaq market site on april twelfth during which will share and demonstrate the powerful functionality and client and consultant experience of hugo while we eagerly look forward to in person engagement with the investment community that day will leave open up possibility of a virtual event depending on the covert restrictions in place at the time in clothing i'm pleased to introduce our gp his inaugural advisory board this board was created with the purpose of gathering valuable strategic insights from senior level executives within the business and professional services industry these influential executives will provide our tp with independent guidance and advice on market strategies and trends that are defining today's changing workplace and workforce the advisory board will also support our highest level global business development efforts with broader access to new planes and prospects by leveraging the deep professional networks of the five well connected executive who have joined us we welcome just guilty and john now the tone deaf p three and craig shave for to the rgb family along with group hughes who will continue to support us in his new role in europe
spk_3: they are impressive and diverse bio as can be accessed be our website we believe this group will help us expand our brand awareness of the sea level and will attract new players who are increasingly looking for an alternative high value partner while now turn the call overdid him for an update on operations thank you kate and good afternoon everyone during the second quarter we talking to you from revenue and margin room as well as fortitude and operating that we saw larger deal by the continued penetration into your child as well as hype that suffered new logo among noted that the and a few on relative to revenue and pipeline continue enterprise revenue increased by three month with that google prior quarter and nine percent punctually while popular been elected he demonstrated continued strength is by the thanksgiving holiday leading to significant increases involve qualified opportunity and ultimately to the highest quote deal in several years
spk_0: barber one it was consistent across our core business in asia pacific europe north america rhapsody in chelsea while riding economy a macro trends germane to our business have provided some economic tell when are operational bogus and tenacity have led to increased opportunity bigger when and growing foundational francs
spk_3: growth we are theme reflects the speed of those companies are taking on change but also broader and more permanent shift in the way workforce plans are built for delivery of the use of an agile workforce are here to stay as much for the fact that copies recognize the benefit of accept the talent that can be rapidly deployed but it's be purpose as the real they janelle labour transit changed and a broader swath of people are choosing work differently the desire for flexibility a symbiotic and is a powerful economic force that continues to accelerate we see more candidates seeking flexible employment with more control and a theme declines in attrition rates and increase than hiring in our variable employee base over the last fourth one a stigma of nontraditional planet which is probably when rgb was founded have now dissipated the building opportunity variety of choice remote delivery optionality and of the control of a ones portfolio of experience is a desirable value proposition to increasingly larger segment of the workforce that simply we want to work differently we will continue or tirelessly to provide brought opportunity and depth of choice for to consult them and those considering joining our platform we're confident that are demonstrated ability to give people career control access professional community and are strong roster of glance will continue to be an attractive home for the water motor despite a tightening labor market which have more immediately impact the traditional employment as an example a new consult them and our taxes practice was considering to traditional employment opportunities one of the consulting and one the financial services industry he turned down both opportunities to work brought on the long term project that premier quiet and offered him the ability to make him be an impact without being restricted to singular industry another reason higher join for the opportunity to work on a large scale finance have permission and a well known technology quiet she loved her job and industry for the opportunity to learn new things work with varied college and to gain experience and normal environments these example demonstrate a rising desire for armed one a model and durability and and virtual environment to sustain them over time we expect to continue to compete with traditional employers for talent and to win an increasing rates we're focused on the happy overall consult an experience in remaining closely a to the workforce desires leading to more employment big enough to our gp hybrid return to work with companies embracing distribute employer bases and utilizing a blend of on silent virtual appeal is the dominant operating model that allowed for flexibility and resilient in the wake of time and future variants impact on the way we all live and work ability to tap into a wider array of talent and added by geography allowed up to improve operational efficiency emerald success rate in match imagine a supply and demand a good example of this is a climate of se that is a pre ipo technology and for our client service team persistently nurtured as through the pandemic and when the opportunity arose was with able to rapidly the play team to effectively data for finance option and helpless of them implementation day that team of course the debris them geographically dispersed and will get across the enterprise supporting day to day operations with professional staffing and be a project involving a larger initiatives our by do a project services group of how large book footprint with the client since day one and of currently leading a professional program offers couple the change management this demonstrates how operational tenacity coupled with strong delivery intersects with today's macro trying to provide for commercial opportunity for rgb now let me turn back to our second quarter operation during the quarter with like continued strength in the pipeline and top of the final activity average weekly revenue grew by approximately eleven percent from the first which required to the last in fact average day we revenue rates and of the quarter of the highest they've been in over a decade and pipeline and but revenue of a strong they've been several years i think it's need to be a big opportunity to crop up factor and we will continue to be very focused on pricing as we know there an upside and lovers to be named new generation an opportunity identification to to be strong into two three and the early to the quarter have shown strong positive trend in revenue pipeline and close bill
spk_2: in fact the early quarter with the rather trump the built some lapse with them to to which were very strong with a holiday season volume a quarter of we will be impacted but expects return strong in early january finally let me touch on operating lovers as in prior quarter inch you to we both have been making strides in control of the cops and focusing on efficiency adjusted either a margin improve both sequentially and from prior quarter we will continue to sell the will run operate in a more hybrid fashion look for opportunities reduce or fixed real estate for print and you like technology to improve the way we operate and provide a better experience for stakeholders i will now through the call of the jam for more detailed review of our second quarter rebel thanks to him and good afternoon everyone during a second fiscal quarter same faith in the man coupled with successful bull market execution enabled us to attain the strongest helpline revenue and a lot ten years we improved enterprise price fill rate that achieve better pay bill a shell additionally higher leverage it into a caught the service further to above guidance gross margin but persistence target of reducing six car and improving operating efficiency as she lay leverage continue to be favorable we deliver twenty four point nine million of adjusted ebitda or a twelve point five percent adjusted ebitda margin which is the highest marginal any quarter in the last decade melanie provide more color on our operating results starting with revenue with quarterly revenue a few hundred point two million well exceeded the high end of our revenue i don't a hundred and ninety million after adjusting for business day and heard the impact security represents quote a thirty one percent year over year and let for that and six percent over the pre pandemic second quarter period of six or twenty and liking respectively in addition or revenue with a let him for says the clay sully on a thursday costing currency bases
spk_4: revenue growth in the second quarter which brought the a crap most of a poor market t client account solution area as well as industry
spk_2: mapper site including a shift toward a more as a workforce model increase in the use of contingent labour to fill what got a company even bracing and execute a more transformational initiative all continue to be meaningful secular chill wind in driving or top like well professional zapping revenue increased forty one percent year over year loud project consulting revenue in feet twenty six percent that he declined account for twenty seven percent year over year and seven percent the playfully our solution operate in business information with thirty seven percent year over year and digital transformation service revenue he continued expand with her as city leading the way of growth rate of thirty six percent year over year in north america revenue to thirty six percent year over year and twelve percent the question we are the same day compton crazy that most quo market in north america experience double digit growth the over year with tri state and california leading the world as fifty one percent and thirty six percent a europe excluding revenue from markets we exited as part of our recent restructuring initiative same day coffin current the revenue grew ten percent year over year and eight percent the place silly or focus on large tier one clients particularly in the united kingdom think he needs to pay dividends revenue in the uk almost doubled the prior your porter allow a german market experience demise decline due to the impact of a coded related lost out on middle market clients and reason asia pacific awful experience broad based expansion a revenue across most market led by japan and india second quarter revenue through eighteen percent year over year and eleven percent the closely or the same day constant currency david both margin in the second quarter with up one hundred and thirty paces place over the prior year to thirty nine point three percent we raised our added still a by one point seven percent and improve ppl ratio by eighty point i are leverage on in direct benefit cause to the remaining improvement as fifty basis point and gross margin compared to the first quarter was margin with up thirty basis points which was primarily a result of lower pay more taxes toward the end of the calendar year a tight labor market and wage inflation have not had brought impact on our thoughts and pay rate as the inherent nature of our adult talent platform involve continue with evaluation of market pay rate and appropriate adjustment i continue thought that of value based pricing have yielded higher enterprise wide adage fill rate which have more than covered the nominal increase in average pay rates average bill rate for the second quarter with one twenty seven compared to one twenty four in of higher your quarter and one twenty six and he won looking ahead with the other teenagers keep hi a bill rate across our solution offering building on a structural improvement in our es una run rate as he added expenses for the quarter were fifty four point one million after excluding downcast thought compensation countries in consideration expense restructuring charges and technology transformation caught representing twenty seven percent of revenue a three hundred and twenty basic point improvement compared to the same period a year ago the increase in action eight dollars from the prior your quarter with primarily driven by higher variable compensation as a direct result of are strong business performance in the current fiscal year fixed costs them a modest and similar to prior year at the result of our streamlined real estate footprint continued adoption of a hybrid what model ill disciplined approach to managing and alex in our internal resources now turning to the other components or a fame and effective tax rate with twenty eight percent for the quarter that more normalized effective tax rate with a result them better operating with all the euro enabling us to utilize the benefits and historical and alone with the same profitability in a foreign entity we expect to begin releasing certain valuation allowances as early as the second half of this both ways to which could result and material favorable impact on our effective tax rate in the current fiscal year adjusted deluded each yes but she had she wrote significantly to forty seven cents per share compare twenty one that includes you of fiscal point one we continue to generate positive cash flow them operations in the first half of the full twenty two would finish the porter with seventy one million of cash and cash equivalent after paying that emily and dollars and contingent consideration and the second quarter leading to the acquisition of veracity in november we completed the financing of a new more high credit facility we increase the boring capacity from one twenty million one hundred and seventy five million and improve the overall pricing as well as the flexibility of the financial covenant would increase liquidity and financial flexibility we are now even better position to execute our future growth strategy while continuing to return capital to our shareholders
spk_4: he maintained or fourteen cents per share of quarterly dividend into to reflecting approximately three percent dividend yield with back to continue to engage in theory purchases opportunistically under our existing share buyback program which has sixty five million as available as of today
spk_2: now let me provide an update on our technology upgrade project drink you to we continue to refine the cost in scope of investing in a set of new york he and talent management system as discussed last quarter these will enable us to optimize efficient the scale operation and enhance the sticky that of a platform by
spk_4: providing our stakeholders a seamless and digital marion
spk_2: total investment in this initiative expected to be in a range of twenty to twenty five million over the next eighteen to twenty four months a significant portion of investment is expected to be capitalized beginning in early calendar twenty twenty two as we family took off implementation non capitalized will cost associated with this project will be included in a cia and reported as technology transformation cause which will be an adjustment in deriving adjusted ebitda until the implementation of complete now are close with our third quarter outlook
spk_0: while we continue to monitor the impact of over cron and evolving dynamic in the labor market we're very pleased with the overall and momentum in the business we expect to see the typical seasonality in the third quarter in our revenue growth margin and as he lay including the impact of holiday across the globe and a certain cases extent good holiday shut down a some of our large i am as well as the reset of payroll taxes at the beginning of the calendar year taking into account the factors we expect revenue eighty three to be in the range of one hundred ninety two hundred ninety seven million gross margin to be the range of thirty seven to thirty seven point eight percent and run rate at cla to be in the rate of fifty three fifty six million now we're happy to take question like you or your mom your doctor question you'll need to cross star one hundred soulful
spk_5: withdrawing question was the bounty
spk_6: i'll go bomb tudor roster
spk_5: harper's question concerning just google would suddenly got me and we proceed with caution
spk_3: thank you are a good afternoon everyone happy new year
spk_5: i'm happy new year
spk_2: of your daughter and you like value on or i guess or first question i have a perky you talked about our or the spot early successes and positive feedback are armed with you though in the tri state area and i guess it's couple questions run as you know when do you anticipate rb did have some commentary round the back up with fiscal year but when you have to speed this goes from pilot to full real loud and odd to build off that you know where the next markets you plan to introduce you go on and would it be a deliberate move needed some regions or at that point would be national arm and also would you do it under a pilot method or would be a full rollout i know as a lot rolled into one was curious how we should anticipate argue the really going to marketing coming quarters right so right now in our pilot stage and this early stage where focused on feedback and engagement more than revenue i am we're really focused as i said in my prepared remarks on m filling the vending machine so to speak so it's a lot about inventory right now
spk_5: we're working toward a six man time frame who are moving beyond pilot and i think it's too early to tell josh whether that would be to the next select markets that we're going to focus on which is texas and northern california i'm but given the way the world it's working now that may well bleed quickly and to more of a national pursuit we just have to learn if we go a little bit but i'd say within the next six months we're going to move beyond pilot
spk_2: that's helpful thank you i'm switching gears a little bit in our i'm i'm kind of surprises environment with the war for talent and general shortages out there that ah
spk_4: they are showing such success and traction and in the pay the bill ratios curie and know sounds like this is sustainable so i just wonder maybe maybe more progenitor get to talk about ah you know the wage and environment in and wage inflation to bury him and why you're so why it appears so easy that your passions along to clients and a
spk_2: talk about the baby's pricey and the attention to stay ahead of the pending rise and pay rates ah but you anticipate any potential pushback from clients or prospects when this comes up her you think the sewer still remain relatively easy conversation given ah you know the secular talents here i just yeah sure on let me talk about hey wait ah first and just a of talk about a few factors that are the impact our overall average pay rate
spk_4: you know it really hasn't moved out much this quarter's hey they compared to last year thing quarter as well as she won a really only moved by about me of roughly ten said a didn't move up a little bit but not not a whole lot of one of the things that snail impacting our overall average carry it next try not only mix by geography but off of next five or solution
spk_2: and though we are seeing on you know more impact and certain solution area such as pack and digital we are seeing arm
spk_4: a rape or of a bit more but in a fine ethnic county area as we have not really a or that much of a significant increase and given up as an a is still ah you know of motherboard extent of our business and that's why you're seeing the mix impact their from up on the average theory and point in the other factor in that i commented in my remarks wishes he given our agile talent model and he'll begin the fluidity of our of our talents of by i would i would argue that you know are paid way it already reflected are very close to the know what market is
spk_2: is how the market is moving because the fluidity of our talent the by and were constantly and continuously evaluating your market parade and ah and making of adjustment i'm so he knows what i think while you don't we are we we are impacted by overall wage inflation but we're going as the is more of a grad
spk_4: more
spk_3: the movement adipose the any sharp rise in our in our future in terms of finance occasion for a feature of pay rates and in terms of bill late you know in your we've been we've been focused on working on reading bill rates for you know for a number of quarters now right of anticipate a movement in ah in the in the pay rate so yeah this is it the perfect time to have these conversations with our with our class and because you're wage inflation and and this is really happening to to anybody broad base so i think at a time like this and because of the labor shortage you know i think our clients are really starting to appreciate more of the value that we bring to them because we can supply the talent to them at a time when they you know when when and when they really needed to be able to fill their gas though at making those conversations regarding bill wraith much easier on and as him if you anything that actually feel free in here on and on the bill rate by god i wouldn't say that that them because i the confessional the labor market and probably what makes your conversation because the paper team haven't slowed down all as though as god quiet for losing employees the nontraditional limited other opportunity
spk_5: they understand from the map with situation room for little bit your environment to have been the a discussion and i would just tell you about that on the lot calmer i think we're quite wonder mark in any way to the of those still an opportunity brought to get live and armor on the weight by the one comment on that which is good who would you feel from a map what their one of the more people once you migrate to the form of employment and not all that is related to lead the period of a lot of and have to do with their ability to help control
spk_7: and be able to have a broader put boy of experience in the are highlighted a couple of those example
spk_2: it not be like a good remarks and i can say that at least one of those situation they were i'm i'm they turned out an opportunity to make significantly more money to be able to have control and work our project that they wanted
spk_4: the does her i really helpful and say thank you did discover quick housekeeping type questions i'm obviously and really shrunk from and impressive performance all around you consistently been a stronger generator cash and ah you know saw that announcement early december i'm just curious are there other and
spk_2: is is opportunities were on you could buy back saw the stock from a shareholder connected to any pyre acquisition and ah
spk_4: a series of about that person and building off that after
spk_5: yeah sure does we did buy that are about twenty million dollars worth of with have shared in early december in a in a private universities and national with that you know where they
spk_2: i felt the seller in really to a acquisition and for not share buyback suspected yeah i think that of i say did they pay for the rest of the fiscal year i don't foresee as being back in the market and buying have begun think you know significant amount more ah a shared by that that you're going forward and fiscal twenty three will continue to know they said engaging in the know the year by that
spk_5: possibly she offset some of our ah dilution try and and but the more opportunistically when we feel that the the value is or the usually right okay and then just given the event which is pretty early in the quarter ah what a good share town to we should be thinking about perfectly three
spk_2: i think thirty three million ah
spk_5: with the mill a with yeah we bought back about million one the i would i would say probably somewhere in the mid thirty two million range
spk_8: okay great and and just lastly eight and you had the comments on this
spk_0: you're given the opportunity you benefits from the historical in an operating losses and not far in regions on is twenty eight percent is that a good tax rates use going forward
spk_3: that's my and as we we are if we are to reverse some of the valuation allowances in a second half of the second half of the fiscal obviously that's going to get us a huge benefit in ah into three of heat that people are fickle twenty he the going forward i think twenty eight is that is a good way you look at our at think about it the touch me
spk_9: or a great well thank you for taking all my questions and very impressive results and gun happy new year everyone
spk_3: thank you picked up
spk_10: take your next question goes or mark markedly their you may proceed with your question
spk_2: a good afternoon and happy new year and congratulations i'm really nice quarter wondering take can you talk a little bit more about hugo just in terms of what the experience was and try states on just in terms of the roles were being filled on you know how quickly were you able to get people into the system on how you envision that you know impacting the economics within the tri state our region as it as it matures because i'm i'm assuming that as that unfolds than that would rule out across the country yeah so early game and positions we've been focused on have been accounting accountant position staff accountant kind of position find accountant position and pay roll as addition especially if it's related to some other recent news around around pay roll am
spk_0: the payroll from that way he hit by a cyber security an incident but right now as i said before mark we are very focused on feedback and engagement with the platform so it's more about that than revenue at this moment while we do have revenue
spk_10: goals for the platform this year we want to make sure the experiences right before we roll out the functionality and access to the platform more broadly and but so far yeah everything's going according to plan we're excited about that early feedback
spk_3: back and the interest from existing clients who wanna get their hands into the platform in and start using it so it's really we have been constricting more of the flow of to ensure that em all the functionality of performing the way we wanted
spk_2: before we go live because you only get you know one time at a first impression and we wanna make sure that that is an excellent experience for both client and consultant like right and what's what's the process for for for basically getting some of the a consultants
spk_3: set up in the system how how difficult is that on what would it would have the barriers or hurdles to that
spk_10: yeah it's really am not hard am but we do have an element of quality control so we had uploaded you know a lot of data from our core or gps system so all of our talent is really loaded into hugo and acceptable they are if we
spk_2: have the right client opportunities that remember we started and an hour early focus his go is a level or two down so i wouldn't expect a ton of overlap yet in our poor or gp consultant bait am but then we do have a level of quality control that it's still
spk_9: a human and touch element to ensure that those you want to be published on the hugo platform will represent the brand and the biology of our gp the way we want them to
spk_3: it great and then can you talk a little bit more about on some of the changes that you're seeing distant terms of with types of people on that are that are coming onto the platform you mentioned a couple of on examples but i'm i'm wondering on or are these people who are a very senior levels what what what qualifications are they are they you know former big for with southern to twelve years of experience or are they at m d levels what what are you seeing as from up from out from the demographic groups yeah and you're talking marco and make sure i'm answering your question you're talking about he go in particular no no not now shifting over to will him was talking about which would rather than i'm going to give him this question if you up my mark i think is perfect for this one ah a are happy new year and you know if god which i would i would say to you you know for for others have been a long time like what what i would say the demographic that we usually fall was around fifteen years of experience and we still feel bad demographic but we're seeing for the broader spectrum so you're seeing you know doubly folks who earlier in their career who are dividing that they wanted a different career path and journey and we're all the up a more senior people who are trying to figure out of they wanted you know to do one or two project for year and to be really really accreted to up regular clive experience or problem so when i would say the big thing is thought you were what was the who have sort of a broader array around that fifteen year of experience and particularly and they are in the earlier career so the five to ten you was doing more of those in need of in the store ugly but that know how they would would just see more and and and part of that comes down to just as broad trend toward line work in a different way so the volume itself are and worldly the will up the volume itself around willing to them for those they're curious is significantly higher about as that been a trend has been up and coming but that is already by what we wanted to the last couple years kim can you qualify that a little bit just in terms of like number of applicants or on number of of resumes that you're getting more people that you've loaded on to the database and he any way to quantify on how much more interests are getting this in terms of people that our our interest didn't miss more flexible on career
spk_0: when i when i look at that i don't have the actual outward good i will have the applicant admission by remark like a follow up with you to give you an order of magnitude on that but what i can tell you in terms of number of hired looking back sort of be pandemic
spk_10: you know comparing it to the pandemic is probably not the the appropriate cop but looking back into the early part of a point why they are or levels are up your ten fifteen percent that to give you a sense for kind of value but
spk_3: than to think about them the the level of experience within that i'm i'm at up the look at the flight and i can tell you are from looking at the the david become committed have the data that a big monthly you can really see that that of a level of experience has and our experience i get that is what was for the number of you that for in the worth have gotten markedly lawrence of it was defeated the board it settled that war from that now on average great and then with with the gods to on the tri state and and california some how much of the the the increase that you're seeing bears does do to you know some of the capital markets activity that's been occurring both in terms of
spk_10: venture funding as well as you know ip as
spk_2: any sense for that that definitely a contributing factor but i wouldn't that the driving force of you really what you're saying is i mean you got sort of the a macro forces where companies are recognizing that they need to tap into are like ours to help them up with the regular changes the transformation the they haven't dated a business
spk_3: and then there are two the transaction that are set off an an an and the ipo so that that of the component on i play with with with what probably i think of it or fourth worth driving and just the pace of change the companies have to go through today
spk_11: to make sure to to ensure that they're staying with the heard level on how to get step ahead and then when you couple that with both the workforce of desire to you're not be tethered to traditional employment but also accompanied management desire to have more the platform resource for the intersection of us with once is really was driving a as
spk_3: they and then digital transformation obviously that picking up you give a sense against the that the size of of that practice and and how how much stronger it is now than that it was a six months ago or year ago yeah hi mark and digital a detective digital all as roughly about the death below fifteen percent of i overall rather on and it's as fluctuated emily increase over the last few quarters and but as you know the right near the that the remainder of the business is growing as well though you know at that is it it so that the about fifteen percent right now and the deathly certainly gray at the know at the same pace as not faster than some of our other odds was a family and and then on the on the bill rates and the opportunity for lift and being under market can you talk about how quickly you might be able to do that and kind of what the magnitude is say and f in a relative to attack and digital i'm well they have your first question is not fast enough of it you have agreed with you know there's a certain amount of element of their them have a book of business the under for the the same rate hard to be like that that we know is be extended to renegotiate the card to have that discussion but so it'll be faster on the opportune
spk_10: where we're going into a new client or we're going into new project very that be quiet and we believe
spk_3: will the more confident in in in picky about are private am i think the i mean every day i'm addicted opportunity across the board to raise prices generally i think the opportunity with it up an aids probably an order of magnitude laughed and it isn't tackle digital because their construction of supply and activision off that's probably a higher level than of them that we have another functional areas but also because there's just so much that going on from a digital transformation standpoint absence of copy to try them yet and improve the experience of or stakeholders that they are willing to spend more upfront and more media was great and then what about length of assignments and also being able to keep consultants on assignment through the the length of the contractors sing in our visitors his resignation great reshuffle their is that reading any challenges for you are you seem kind of the same levels of of you know completion percentage
spk_9: i mean where it had been pretty the great question because i'm i would say to the bar average like the phantom eleven very that much i think will a challenge combat is that there is more opportunity for consult them and some of them do get post at what i would they are an inopportune time like on you know prior to that
spk_3: on how you almost never thought somebody commit to a project and then sort of at the eleventh hour
spk_10: leave to go to another project and seen that happen
spk_2: i would this several times must have a combination of our clients or the theme but it is a function of kind of what's happening and well today when i will say i have the while that it's frustrating and haven't it haven't reduced our our opportunity to close the work and you know what i want to or greater strength is resilience when those type of the bathroom and were able to rebel to turn those situations around but i think with if you compare that to sort of the on migration away from jerusalem that some of our clients are see a while or impact and i feel like we're not as it back in the family there great and then i mean obviously are your
spk_12: really nice turn around how are you thinking about longer term what the margin profile should look like
spk_2: as as we can go through this on know evolution in the business yeah hi mark and yeah we are here this year as year today are largely right now they you know is a roughly around twelve twelve point three percent said i think i think longer term we think the weekend i think he'd prefer to the as inherently marty allergen it seems i of margin and he him and in the near to midterm i think twelve for said he is on a sustainable but i think it over the long term as you know we're working on the technology or affirmation project one of the one of the benefit that the other way that the on this project is that within achieve much better your automation and
spk_10: and lot to make him better efficiency which is really the help us will scale and our and improve our as she lay leverage deal with that was that that positive in l a is a complete and way people live with you expect you to there's more room in the margin i believe that we can get you ah mid mid
spk_2: he margin
spk_0: now submarines does add to that just a little bit mark you know it's a combination of the things that were working on now certainly the technology that can talked about and the that we're moving from really end of life courses them to state of the art systems and we do believe that will matter in the business and will matter to our financial results
spk_13: but also as hugo gains adoption and that self service platform and continuing to build that kind of digital experience and everything we do it or gp and will drive efficiencies back and how bad think of our margin in ways that yeah we wouldn't have ten years ago and and we're all committed to that to delivering shareholder returns and really driving everything was due to to improve that terrific thank you so much you're welcome thank you mark
spk_2: it's question goes from and your spider with with jp morgan you may proceed with your question
spk_4: great happy do y'all are jammed my question is about your comment towards the end of your prepared remarks or what you were talking about the outlook for third quarter you mentioned extended shut down to around the holidays and got your sort of in the same at raf you said you know expecting cup typical treated our
spk_2: is ah and and i got really compare with yeah that kind of at the middle the range for revenues or minus three percent sequentially for a third quarter from a patrick second quarter is typical seasonality for my question is a little more nuanced the question is why you're trying to call out unusual usual neg
spk_4: it it's seasonality around the holidays in december and then made up for kind of in a faster start have january february so just kind of breakdown right when you say a a typical seasonality and you off that extent shutouts was december have a normal ah december are you start counting on kind of january february to make up for our any kind of shortfalls around kind of people taking holidays
spk_13: yeah you know i've beginning of weeks in our into three i think him refer to the theater are for sale here we are are we are still building momentum on the end of kids you still early weekly revenue eighty three and in december and before the holidays are seeing roughly by a one is for sense of easy to convince you that that the end of two
spk_14: q and ah you know the were even though were ahead we know that within a ahead or holidays he did and
spk_4: over the last couple of years your we are seeing them on a larger quiet you know how to extend the shut down for example rdp we've covered to now we also decided to give our people a week break over the holidays so of that is going that is contributing to a little bit more ah seasonal impact or compared to you know compared to
spk_2: previous years and so it's really really accounting for that that that seasonality in the holiday part and and the peripheral they impact of the well and then also taken into account you know overcrowded still out there so we did build and on loosely some some impact from potential impact from oakland as well
spk_3: but we do expect with you expecting january and february we could pick up some acceleration right right right right i just don't laugh off economic on a so it is obviously knife in fact that you bought some impact from a club but should it on a crime sort of be very little impact to your business always a your business just as easily delivered remotely as it is on site and felt like i i i get it know the last sort of ten days around ahmed khan has been nervous for all that but when you just look at the way you deliver would you really expect there to be much of an older kwan impact there you out the was just caught the national workforce is more remote in january and february yeah me any many this made me a common okay he wanted some i mean yes we are more resilient and terms of delivering ah you know remotely but it's also about project start fly them you know it could it could push back on the clock have an impact on our clients business nicholas it could push back project start the that kind of what where where where be going into in terms of because all cron overall impact yeah i think what we're what we're working with his we publish the mandatory policy that were required to publish andrew by a thing of the temper eleventh of this month is what kind of requirements will our clients have which then go to pushing out start the
spk_13: a trick cetera and that's the only thing we worry about right but just to be korea it's it's good that you built that into your assumptions you haven't seen any delay or projects transcript of of a crime right
spk_0: no not yet not not not not not be material but them loose odyssey see a poison from a major markets will start to see some
spk_2: larger incidence the break out as though
spk_0: yeah tube with the is it would be careful about that because of that

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