TrueBlue, Inc.

Gentlemen, thank you for standing by and welcome to the True Blue first quarter 2022 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, please press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again press star one. Thank you. Derek Gaffert, Executive Vice President and CFO, you may begin your conference.

Good afternoon, everyone, and thank you for joining today's call. I'm joined by our Chief Executive Officer, Patrick Burrell. Before we begin, I want to remind everyone that today's call and slide presentation contain 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 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 welcome everyone to today's call. I am pleased to report our strong performance trends from 2021 continued into the first quarter, with all three segments capitalizing on widespread demand for our services. led by People Scout, which delivered a fourth consecutive quarter of revenue growth. Overall, revenue was $552 million, an increase of 20% compared to Q1 2021, marking the fourth consecutive quarter of double-digit growth. People Ready revenue trends benefited from historically high bill rates and worker supply improvements, while contributions from new and existing client demand drove People Scout results. We are also pleased with the revenue growth in our people management business, despite global supply chain challenges. These factors, along with our continued focus on improving operational efficiencies, produced net income of $11 million, an increase of $4 million compared to Q1 2021. Let's take a closer look at the performance of each of our three segments, starting with People Ready. People Ready is our largest segment, representing 58% of total trailing 12-month revenue, and 61% of total segment profit. PeopleReady is a leading provider of on-demand labor and skilled trades in the North American industrial staffing market. We service our clients via a national footprint of physical branch locations, as well as our Jobstack mobile app. PeopleReady revenue was up 17% compared to Q1 2021. Bill rates are at historic highs and outpacing pay rates. while worker supply continued to improve and performance within retail and hospitality was solid. People management is our second largest segment, representing 29% of total trailing 12-month revenue and 9% of total segment profit. People management provides onsite industrial staffing and commercial driver services in the North American industrial staffing market. The essence of a typical people management engagement is supplying an outsourced workforce that involves a multi-year, multi-million dollar onsite or driver relationships. We are very pleased with people management growth this quarter, with revenue up 8% compared to Q1 2021. Thanks to sales and our onsite business produced year-over-year growth despite global supply chain challenges, and demand for our commercial trucking services remained robust. Praying to our third segment, PeopleScout represents 13% of total trailing 12-month revenue and 30% of total segment profit. PeopleScout is a global leader in filling permanent positions through our recruitment process outsourcing services, as well as offering managed service provider solutions. PeopleScout delivered a fourth consecutive quarter of growth, with revenue up 76% compared to Q1 2021. Results this quarter benefited from a combination of the restaffing surge of existing clients that started to ramp in Q2 2021, higher employee attrition rates in our existing clients, and new client wins. Before turning to our strategies, I want to provide a bit of context for recent business trends. During the back half of March, we typically see a seasonal increase in People Ready revenue. This year, the ramp was less, due to seasonal and project work in the retail industry that will not carry into Q2, as well as some clients taking a more measured approach to on-demand temp labor as a result of broader economic uncertainty. On the plus side, sequential growth for People Ready in April has been in line with historical norms. Revenue trends for People Management and People Scout continue to perform as expected. Now I'd like to shift gears and update you on our key strategies by segment, starting with People Ready. At PeopleReady, our most important strategy is to further digitalize our business model to gain market share and improve the efficiency of our service delivery cost structure. The U.S. temporary day labor market is highly fragmented, and there are very few large players in the industrial staffing segment where PeopleReady competes, with the bulk of the market made up of smaller companies. These smaller regional companies are typically not able to spend the type of investment required to deploy something like our Jobstack mobile app. So this, along with our nationwide footprint, is what makes us a leading provider within industrial staffing. At the center of our digital strategy is Jobstack. The application has created a unique user experience for our associates and clients, allowing both groups to connect at any time. Since deploying the application nearly five years ago, associate adoption has grown to over 90%. Turning to clients, total users of the application are 29,900. a 13% increase versus Q1 2021. We continue to focus on converting clients to heavy users. As a reminder, a heavy client user has 50 or more touches on Jobstack per month, whether it's entering an order, rating a worker, or approving time. Overall, heavy client users account for 57% of People Ready US on-demand revenue compared to 44% in Q1 2021. We've also seen continued growth in our digital fill rates, which have increased to nearly 60%, with 792,000 shifts filled via the app during the quarter. Not only does Jobstack provide a differentiated experience, but also is a key enabler for our service center strategy, which aims to better serve existing clients and reach new ones more effectively. The enhanced go-to-market approach increases operating hours by 25 hours per week, compared to a typical branch and includes repurposed job roles. This includes the addition of territory-based account managers responsible for expanding and building relationships with new and existing clients and the reduction of non-client facing positions resulting in a net cost reduction. We expect the new structure will deliver a greater sales focus and provide elevated customer service. Last year, we successfully launched and later expanded the territorial coverage of two service center pilots. In addition, earlier this year, we opened a service center dedicated to skilled trades and added a fully virtual model to test. Results for all pilot locations continue to improve as we advance the operating model and apply learnings. For example, we are learning the virtual model tends to have materially lower employee attrition, thus creating more continuity potentially leading to better financial metrics relative to the other models. As we move forward, we will be closely assessing the progress of both physical and virtual models to develop the most ideal structure for the business. Turning to people management, our strategy is focused on execution and growing our client base. We continue to invest in our sales teams to enhance business development activities, and we remain focused on expanding our geographic footprint by targeting more local and underserved markets. Coming off a record level of new wins last year, people management has secured annualized new business wins of $21 million this year, up more than 40% versus the three-year comparable average prior to 2021. The continued strength in new wins, as well as improving trends in existing client sales, are helping to offset recent global supply chain challenges. Additionally, we are investing in customer and associate care programs in an effort to better serve our clients' needs and improve retention. Turning to PeopleScout, our strategy leverages our strong brand reputation to capture opportunities in an industry poised for growth. Many companies reduced or eliminated their in-house recruiting teams during the pandemic, and now we are seeing companies return to hybrid and fully outsourced models. Our ability to hire large volumes of workers has allowed us to meet the demand of our existing client base as they are restaffing to pre-pandemic levels. specifically within travel and leisure. To capitalize further, we made investments in our sales teams to expand wallet share at existing clients and obtain new clients. Our efforts continue to deliver strong results with annualized new wins of $12 million this year, up 27% versus prior year. Our ongoing commitment to our digital strategies, combined with our focus on improving operational efficiencies, are driving operating margin expansion and creating a competitive advantage for us in the market. I'll now pass the call over to Derek, who will share greater detail around our financial results.