TrueBlue, Inc.

Good afternoon. My name is David, and I will be your conference operator today. At this time, I would like to welcome everyone to the True Blue first quarter 2019 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. Thank you. Derrick Gafford, CFO, you may begin your conference.

Good afternoon, everyone, and thank you for joining today's call. I'm here with our Chief Executive Officer, Patrick Burrell. Before we begin, I want to remind everyone that today's call and slide presentation contains several forward-looking statements, all of which are subject to risks and uncertainties, and we assume no obligation to update or revise any forward-looking statements. These risks and uncertainties, some of which are described in today's press release and in our SEC filings, could cause actual results to differ materially from those in our forward-looking statements. We use non-GAAP measures when presenting our financial results. We encourage you to review the non-GAAP reconciliations in today's earnings release or at TrueBlue.com under the Investor Relations section for a complete understanding of these terms and their purpose. Any comparisons made today are based on a comparison to the same period in the prior year, unless otherwise stated. Lastly, we will be providing a copy of our prepared remarks on our website at the conclusion of today's call, and a full transcript and audio replay will also be available soon after the call. With that, I'll turn the call over to Patrick.

Thank you, Derek, and I'd like to welcome everyone to our call today. During the first quarter of 2019, Our focus remained consistent with the initiatives I described at the start of the year, which included putting our three businesses on a path towards sustainable growth, managing costs to enhance profitability, and leveraging our excess free cash flow to return cash to shareholders through share repurchases. Our team delivered a solid quarter with flat revenue growth, a step up from the prior quarter's negative 3% growth. Our gross margin was up 100 basis points year over year, marking our 13th consecutive quarter of gross margin expansion. This figure does include approximately 70 basis points of benefit associated with legacy workers' compensation insurance policies, which is excluded from adjusted EBITDA and adjusted earnings per share. With regards to SG&A, we continue to maintain a disciplined focus on managing our costs. On the bottom line, We produced adjusted earnings per share of 27 cents, which was at the high end of our 22 to 27 cent guidance range. In addition, we repurchased another $5 million worth of shares during the quarter and have $53 million remaining under the current buyback authorization. From a big picture perspective, as I discussed in February, our aim is to remain at the forefront of the changing world of work. Changes in the market are being driven by demographics, Widespread skill shortages and employers increasingly seeking just-in-time solutions to more thoughtfully navigate their workforce needs. True Blue is not only adapting to these changes, but also leading the way with the strength of our service offerings and our strategic use of technology. Let's discuss how this strategy is being deployed across our three businesses, starting with People Ready, the leading provider of on-demand labor and skilled trades and the North American industrial staffing market. PeopleReady represents 61% of trailing 12 months total company revenue and 58% of combined segment profit. PeopleReady's growth of 3% marked an uptick from the prior quarter's 2% and was our fourth consecutive quarter of revenue growth. Our Jobstack mobile app is transforming the way we do business. and helping to competitively differentiate our offering in the eyes of contingent employees and our clients. We recognize that transformation takes time. It's hard work, and we're learning as we go, and progress has been steady. During the first quarter, we dispatched more than 800,000 shifts via job stack and achieved a digital fill rate of more than 40%, up from roughly 30% in Q4. Considering that Q1 is our lowest volume season, we are well on our way to achieving our goal to dispatch 4.5 million shifts in 2019, or one worker dispatch every seven seconds. Associate adoption is now north of 80%, and we have more than 15,000 clients using the app. Achieving critical mass has made the functionality and appeal of Jobstack even more apparent, and our app store ratings have risen accordingly. Our IOS rating currently stand at 4.6 out of 5 stars for the worker app and 4.7 for the client app. Shopstack is also helping us attract new associates and clients. In Q1, we launched our associate referral and rewards program and further enhanced our digital client acquisition marketing efforts. We are encouraged by the early results we are seeing from both of these. Our branches are already seeing hundreds of new workers ready to work as a result of the program. From a client acquisition standpoint, we have deployed a number of digital campaigns aimed at new and former clients, and we're seeing a solid increase in qualified leads coming through these marketing efforts. People management provides attractive on-site workforce solutions in the North American industrial staffing market and represents 28% of trailing 12 months total company revenue and 12% of combined segment profit. Revenues were down 14%. with growth constrained by previously discussed headwinds, including the loss of Amazon's Canadian business, last year's divestiture of plane tax, and volume and price reductions at another retail client. People management offers a compelling onsite value proposition that's a perfect fit for larger clients with longer durations, strategic needs, or contingent workers. Despite some same store sales headwinds, people management will continue to focus on adding new onsite client engagements. Our annualized new client wins were significantly higher in the first quarter of 2019 compared to the same period last year. As these wins begin to ramp, we now see a pathway back to growth in the back half of 2019. PeopleScout is the global leader in filling permanent positions through our recruitment process outsourcing and managed service provider offerings and represents 11% of trailing 12 months total company revenue and 30% of combined segment profit. Revenue was up 26% overall, but declined 1% on an organic basis, which was in line with expectations, but lower than our typical organic growth rate due to previously disclosed headwinds. Our global strategy for PeopleScout is aimed at capitalizing on our leadership position in the North American RPO market, as well as our expanding global capabilities. We believe the introduction of Affinix Our proprietary next-generation HR tool is improving our ability to compete and improving our win rates for new client engagements. It's still early days for Affinix, but during the first quarter, PeopleScout saw a sizable uptick in our annualized win rate compared to the same period last year. Affinix is helping us compete and win because our clients see the difference in the candidate hiring process. For example, and many of our clients, we are now seeing significant increases in candidate flow from our enhanced use of artificial intelligence. Additionally, candidate conversion rates are increasing through Phenix's easier to use mobile enabled process that mimics best in class consumer mobile experiences. As a result, time to fill for clients fully implemented on a Phenix have improved dramatically, which is especially impressive given the tight candidate market. In summary, We're off to a solid start in 2019, and we see many opportunities ahead to build upon the enhancements to our solid foundation over the past year. In particular, we plan to leverage Jobstack to drive our long-term competitive advantage at PeopleReady, and we see opportunities at people management with new and existing clients. In addition, PeopleScout will continue to leverage Affinix in our global strategy to drive long-term growth. We continue to stay focused on organic growth, Managing costs to drive strong cash flows and returning capital to shareholders. With that, I'll hand the call to Derek to take us through our financial results in greater detail.