Slide 1: Q2 2014 Investor Presentation
Q2 2014 INVESTOR PRESENTATION
Slide 2: Forward-looking statements
Certain statements made by us in this presentation that are not historical facts or that relate to future plans, events or performances are forward-looking statements that reflect management’s current outlook for future periods, including statements regarding future financial performance. These forw
Slide 3: Investment highlights
• Specialized approach in growing staffing market • Significant upside as construction market rebounds • Compelling growth and technology strategies • Strong operating leverage • Strong capital position supports growth
Slide 4: Company Overview
COMPANY OVERVIEW TRUEBLUE TABORREADY SPARTAN =EICLP a TRUEBLUE company General labor, on demand Manufacturing & logistics Skilled trades for energy, industrial, construction projects Planeletis S7-CENTERLINE a TRUEBLUE company a TRUEBLUE company Aviation mechanics & technicians Truck drivers (2201 f
Slide 5: 2013 Total Revenue by Industry
CONSTRUCTION 23% ENERGY & INDUSTRIAL 7% MANUFACTURING 21% TRANSPORTATION 13% WHOLESALE TRADE 8% RETAIL 7% SERVICES & OTHER 14% AVIATION 7% 2013 Total Revenue by Industry
Slide 6: Key company facts
25+ $1.7B Years in Business 2013 Revenue 375,000 Connect More Than People to Work Each Year 130,000 Serve More Than Businesses Annually Rounded
Slide 7: What We Do
WHAT WE Recruit and screen workers WORKERS Workers paid based on hours worked and hourly pay rate TRUEBLUE Employer of Record for workers Customer pays for hours worked at agreed-upon bill rate Assign workers tojob assignments CUSTOMERS 2204 rr Pron >
Slide 8: A Leading Provider in Industrial Staffing Industry
A LEADING PROVIDER IN INDUSTRIAL STAFFING INDUSTRY $100 Billion Overall Industry $29B OFFICE IT FINANCE HEALTHCARE OTHER INDUSTRIAL STAFFING Source: Staffing Industry Analysts, TrueBlue estimates
Slide 9: Industrial staffing market forecast
INDUSTRIAL Source: Staffing Industry Analysts, Moody’s economic forecasts, TrueBlue estimates. 2013 2017 $36 BILLION $29 BILLION Market Market Forecast
Slide 10: BLS employment projections
Source: U.S. Bureau of Labor Statistics, BLS employment projections 2012-2022. Job openings are due to growth; replacement needs are a result of retirements due to aging workforce.
Slide 11: Why Businesses are Using More Temporary Staffing
Why Businesses are Using More Temporary Staffing: Source: Bureau of Labor Statistics. Measures number of jobs added from help supply services as a percentage of total non-farm payroll. Timeframe measured is 52 months from the start of the recoveries: August 1991, May 2003, and September 2009. Temp J
Slide 12: Construction situation and opportunity
SITUATION • Construction spending on the rebound • Positive momentum for housing starts; construction employment on the rise OPPORTUNITY • Significant construction revenue increase • Multiplier effect on manufacturing, warehousing, logistics, retail, and services
Slide 13: Construction revenue 2006 vs 2013
$450 MILLION $330 MILLION 2013 Construction Revenue* 2006 Construction Revenue * For comparison purposes only; excludes revenue from MDT.
Slide 14: Manufacturing situation and opportunity
SITUATION • U.S. Manufacturing Renaissance • Increased incentives to “re-shore” including increasing wages in China, offshore product quality concerns, and logistics costs • Decline in energy costs OPPORTUNITY • Provide flexible, skilled labor force • Closer-to-customer improves service
Slide 15: Transportation situation and opportunity
SITUATION • High driver turnover • New safety regulations create need for more drivers • 100,000 new drivers needed per year, over the next 10 years* OPPORTUNITY • Access to hard-to-find talent • Safety and compliance leadership • Flexible recruiting model • Logistics company partnerships * Source:
Slide 16: Energy situation and opportunity
SITUATION • Growing energy independence • Skilled worker shortages • More than 100,000 new jobs in the solar industry by 2016* OPPORTUNITY • Deliver and manage skilled work force in remote areas • Deep technical knowledge in green industries • Partner with trades schools to fill skilled-worker gap •
Slide 17: TrueBlue revenue growth vs staffing industry
Source: Staffing Industry Analysts, Moody’s economic forecasts, TrueBlue estimates 13% CAGR 6% CAGR TrueBlue revenue growth since 2010 Staffing industry growth since 2010
Slide 18: Growth strategies: organic, acquisition, technology
ACQUISITION GROWTH COMPELLING In addition to organic revenue growth, TrueBlue has a proven track record of successfully acquiring and integrating staffing companies. Use of technology continues to improve the experience of our workers and customers and drive efficiency in our business. ORGANIC GROWT
Slide 19: Organic growth strategy
• Expand knowledge of customers’ industries • Increase functional expertise: transition from generalist filed positions to dedicated sales, recruiting and service roles Differentiation Through Specialization Improve Service Delivery Service Line Expansion • Expand geographically through technology o
Slide 20: Acquisition growth strategy
• Increase scale and market share • Proven track record of successful integration • Opportunity for potential operational synergies Strengthen Existing Services Add New Capabilities • Provide new services to existing customers • Add knowledge and expertise • Diversify the business
Slide 21: Acquisition criteria and results
RESULTS CONSIDERATION • ROIC* • Strategic fit • Cultural fit • Limited financial risk • New business capabilities • Talent • ROI >cost of capital • $240M invested between 2004 - 2013 • Aggregated acquired companies ~50% of 2013 revenue • Platforms to seamlessly tuck-in future acquisitions * Return o
Slide 22: Technology: improving quality and efficiency
IMPROVING QUALITY AND • Faster fill rate and better job matching • Greater flexibility and convenience • Increase access to services and jobs Worker and customer experience • Consolidate branches • Automation of routine tasks • Seamless processes Increase Business Efficiency
Slide 23: Technology across the workday
Dispatch MORNING Increasing the speed and success of job matching and order fulfillment through text messaging and mobile applications. Payment Greater use of electronic time capture and payment methods. Recruiting MID-DAY Streamlining the application process, increasing mobile capabilities, and ena
Slide 24: Liquidity and debt
Dollar amounts in millions Q-1 2014 Q-4 2013 Cash & Investments $ 161 $ 137 Borrowing Availability $ 74 $ 74 Total Liquidity Strong liquidity position to fund acquisition strategy $ 235 $ 211 Debt Low financial leverage balances strong operating leverage $ 29 $ 30
Slide 25: Business model example and operating leverage
* This example reflects an approximate conversion rate of organic gross profit to EBITDA assuming mid-single digit revenue growth and current business mix. See Appendix for EBITDA and Adjusted EBITDA reconciliation to GAAP measures. 60% $100 Conversion Rate $60 Organic Gross Profit EBITDA 21.1% 21.9
Slide 26: Revenues and Adjusted EBITDA
Dollar amounts in millions Revenues Adjusted EBITDA* and Margin $45 $64 $72 $87 $1,149 $1,316 $1,390 $1,669 * EBITDA and Adjusted EBITDA are non-GAAP measures. See Appendix for further discussion and a reconciliation to GAAP measures.
Slide 27: Investment highlights
• Specialized approach in growing staffing market • Significant upside as construction market rebounds • Compelling growth and technology strategies • Strong operating leverage • Strong capital position supports growth
Slide 28: Appendix
Appendix (22044 ee Presentation TRUEBLUE
Slide 29: Operating Income to EBITDA & Adjusted EBITDA Reconciliation
OPERATING INCOME TO EBITDA & ADJUSTED EBITDA RECONCILIATION 2010 2011 2012 2013 * EBITDA and Adjusted EBITDA are non-GAAP financial measures. EBITDA excludes interest, taxes, depreciation and amortization from net income. Adjusted EBITDA further excludes from EBITDA non-recurring costs related to th