Slide 1: TrueBlue Investor Presentation Q1 2012
[ 2012 Q1 RUE BLUE Investor Presentation
Slide 2: Cautionary Note About Forward-Looking Statements
This document contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “will,” “should,” “expects,” “intends,” “projects,” “plans,” “believes,” “estimates,” “targets,” “anticipates,” and similar expressions are used to ide
Slide 3: TrueBlue Investment Highlights
TrueBlue Investment Highlights 3 Successful vertical industry approach Compelling growth potential for staffing industry Unique industry-related growth drivers for TrueBlue Multiple strategies to drive growth and efficiency Strong operating leverage Solid balance sheet
Slide 4: A Leading Provider of Blue-Collar Staffing
Every day, we use our specialized approach to the market to find new opportunities to better serve customers and workers at all skill levels. A Leading Provider of Blue-Collar Staffing 4
Slide 5: Blue-Collar Specialties
General labor, on demand Specialized skills for manufacturing & logistics Skilled trades for energy, industrial, & construction projects Aviation mechanics & technicians Truck drivers Blue-Collar Specialties 5
Slide 6: The Leading Provider of Blue-Collar Staffing
The Leading Provider of Blue-Collar Staffing 2011 Revenues = $1.3 Billion* *Brand revenue amounts rounded to the nearest $5 million. 6
Slide 7: Sales by Industry
7 Sales by Industry 2011 2006 Construction 25% 37% Manufacturing 20% 17% Transportation 12% 9% Wholesale Trade 9% 10% Retail 7% 8% Services & Other 15% 19% Aviation 12% 0%
Slide 8: TrueBlue Recognized as a Credible Industry Leader
“Best practices by DHS/ICE Partner” “Forbes Most Trustworthy Companies” “VIP program to promote employee fairness and safety” “Platinum 400” “Award of Excellence” “Hot Growth Company” “National Universal Agreement to Mediate” 8 TrueBlue Recognized as a Credible Industry Leader
Slide 9: Staffing Industry: A $90 Billion Industry
Other Finance Healthcare Office IT 9 Staffing Industry: A $90 Billion Industry Staffing Industry Analysts 2011 forecast, rounded $25 Billion Industrial/ Blue-Collar $65 Billion
Slide 10: Staffing Industry and TrueBlue-Specific Growth Drivers
Attractive Drivers for Staffing Industry Economic volatility & uncertainty Greater need for flexibility & agility Increased government regulation Unique Industry Drivers Construction rebound Growing need & shortage of truck drivers Manufacturing growth expected to continue Staffing Industry and True
Slide 11: Blue-Collar Staffing – Strong Future Growth
$25B 2014 Market Forecast $30B Source: Staffing Industry Analysts, Moody’s economic forecasts, TrueBlue estimates 2011 Market Blue-Collar Staffing – Strong Future Growth 11
Slide 12: Staffing Industry Still Beneath Peak of Last Cycle
1.0% 1.5% 2.0% 2.5% '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 Staffing Industry Still Beneath Peak of Last Cycle Temporary Penetration Rates Source: Bureau of Labor Statistics. Temporary penetration rate defined as temporary help employment as a percentage of total U.S. non-farm em
Slide 13: Construction Poised to Rebound
Construction Poised to Rebound Construction Employment As a percentage of total non-farm employment 13 5.1% Historical Average (1950 – 2010) “Construction is projected to be the fastest growing goods-producing industry over the next decade, representing 1.8 million new jobs by 2020.” Bureau of Labor
Slide 14: Transportation Employment Poised for Growth
Bureau of Labor Statistics, 2020 Employment Projections Rosalyn Wilson, Council of Supply Chain Management Professionals Transportation Employment Poised for Growth U.S. Transportation Employment 000s Source: Bureau of Labor Statistics. Seasonally adjusted. 14 2,500 3,000 3,500 4,000 '9 1 '9 2 '9 3
Slide 15: New Boom Ahead for U.S. Manufacturing
Boston Consulting Group, May 5, 2011 New Boom Ahead for U.S. Manufacturing Purchasing Managers Index PMI Source: Federal Reserve Bank of St. Louis. A PMI reading above 50 percent indicates that the manufacturing economy is general ly expanding; below 50 percent that it is generally declining. 15 30
Slide 16: More Opportunities to Serve the Market
$1.35B Revenue Labor Ready (89%) CLP (11%) $5 Billion Market 2006 $1.3B Revenue Labor Ready (62%) CLP (13%) Spartan (10%) PlaneTechs (11%) Centerline (4%) 2011 $15 Billion Market 16 More Opportunities to Serve the Market Percentages in parentheses represent the mix of total company revenue by brand
Slide 17: Market Share Opportunities
$4.5 Billion (20%) $7.5 Billion (2%) $1 Billion (17%) $1 Billion (15%) $1 Billion (5%) Market Share Opportunities 1 Staffing Industry Analysts 2011 forecast, 2 Market share (%) based on TrueBlue estimates Market Size1 & (Market Share)2 17
Slide 18: Multiple Strategies to Drive Growth and Efficiency
18 Multiple Strategies to Drive Growth and Efficiency Focus How Why Organic Growth in Existing Geographies Geographic Expansion Acquisitions +++ + + Operating Leverage & Market Share Market Share Market Share • Vertical Market Specialization • Technology supports growth and efficiency • On-site Mana
Slide 19: Strategy: Vertical Market Specialization
19 Strategy: Vertical Market Specialization Dedicated sales leaders with expertise in the specific industries we serve Specialized national sales and service teams deliver tailored solutions to our national customers Local sales and service staff use industry best practices to serve local cust
Slide 20: Strategy: Technology
20 Strategy: Technology Mobile Technology Point of Sale System Customer and Employee Relationship Management Faster fill rates Recruiting and fulfillment across more geographies Increased process efficiency Higher worker quality More effective use of customer and worker information Improved efficien
Slide 21: Strong Operating Leverage from Organic Revenue
Incremental Revenue $100 Gross Profit Generated $25- 26 Operating Expense Associated with Incremental Revenue $(9) – (10) People Investments $(2) – (3) Incremental EBITDA $12 - 15 21 Strong Operating Leverage from Organic Revenue Organic growth from existing geographies = 12% - 15% incremental EBITD
Slide 22: Geographic Expansion Opportunities
Geographic Expansion Opportunities Existing markets KEY 22
Slide 23: Successful Acquisition Record
Successful Acquisition Record Acquisition Results How We Vet Acquisitions Does it fit our strategy? Does it exceed our return on investment requirements? Does it fit our culture and operational structure? Does it bring unnecessary financial or legal risks? 23
Slide 24: Financial Review
Financial Review RUE BLUE
Slide 25: Financial Summary
25 Financial Summary 2011 2010 Growth % Revenue $ 1,316 $ 1,149 14% Gross profit $ 347 $ 303 14% % of Revenue 26.4% 26.4% SG&A expense $ 283 $ 259 9% % of Revenue 21.5% 22.5% Depreciation/amortization $ 16 $ 16 0% % of Revenue 1.2% 1.4% Income from operations $ 48 $ 28 69% % of Revenue 3.6% 2.5% Net
Slide 26: Solid Balance Sheet
26 Solid Balance Sheet In millions Q-4 2011 Q-4 2010 Cash & investments $109 $163 Accounts receivable $154 $109 Current ratio 2.5 3.4 Restricted cash & investments $130 $120 Workers’ comp reserve $192 $187 Debt $0 $0 Shareholders’ equity $294 $313
Slide 27: Recent Revenue Trends
Recent Revenue Trends 27 * Q4 ’10 was a 14 -week quarter vs. 13 weeks for Q4 ‘11. 22% normal- ized growth*
Slide 28: 2011 Stock Buyback Activity
2011 Stock Buyback Activity Purchases Shares Total Cost Q-2 ’11 0.9 million $13 million Q-3 ’11 3.0 million $37 million Q-4 ‘11 0.6 million $ 7 million 2011 Total 4.5 million $57 million Remaining Authorization* $40 million (*) As of Feb. 8, 2012 28 TrueBlue™ (NYSE:TBI) Q1 2012 Investor Presentation
Slide 29: Financial Summary Q4 2011
29 Financial Summary Q-4 2011 Q-4 2010 Growth % Revenue $ 350 $ 312 12% Gross profit $ 92 $ 82 12% % of Revenue 26.2% 26.3% SG&A expense $ 77 $ 72 7% % of Revenue 21.9% 23.0% Depreciation/amortization $ 4 $ 5 -4% % of Revenue 1.3% 1.5% Income from operations $ 11 $ 6 93% % of Revenue 3.1% 1.8% Net i
Slide 30: Gross Margin Change
30 Gross Margin Change 22% 24% 26% 28% Q4 2010 Actual 2010 HIRE Act Credits / 2011 Sales Mix Pricing Q4 2011 Actual 26.3% 26.2% +0.3%-0.4% TrueBlue™ (NYSE:TBI) Q1 2012 Investor Presentation
Slide 31: SG&A Expense Change
SG&A Expense Change $0 $10 $20 $30 $40 $50 $60 $70 $80 $90 Q4 2010 Actual Extra Week in 2010 Variable People Investments Other Q4 2011 Actual +$4M $72M +$2M +$2M $77M ($3M) TrueBlue™ (NYSE:TBI) Q1 2012 Investor Presentation 31
Slide 32: Appendix
Appendix RUE BLUE
Slide 33: Reconciliation of EBITDA to Net Income
33 Reconciliation of EBITDA to Net Income *EBITDA is non-GAAP financial measure which excludes interest, taxes, depreciation and amortization from net income. EBITDA is a key measure used by management in evaluating performance. EBITDA should not be considered a measure of financial performance in i