Derek Dewan | executive |
Kim Thorpe | executive |
Hello, and welcome to the GEE Group Fiscal Fourth Quarter and Year-End September 30, 2023, Earnings and our Update for 2024 Webcast Conference Call. I'm Derek Dewan, the Chairman and Chief Executive Officer of GEE Group, and will be hosting today's call.
Joining me as a co-presenter is Kim Thorpe, our Senior Vice President and Chief Financial Officer.Thank you for joining us today. It is our pleasure to share with you GEE Group's results for the fiscal year and the fourth quarter ended September 30, 2023 and provide you with our outlook for the fiscal year 2024 in the foreseeable future.
Some comments Kim and I will make may be considered forward-looking, including predictions, estimates, expectations and other statements about our future performance. statements. judgments risks the results and materially our current are holds may our from to subject uncertainties forward-looking represent of future what and differ These that actual under These under the and risks the Monday's call.During release XX-Q, recent press Forward-Looking We our earnings are statements other Form Statement and described XX-K Regarding financial in Statements presentation, caption today's Statements and Safe uncertainties assume "Forward-Looking Harbor" most made Form and obligation below SEC "Cautionary Statements non-GAAP Harbor." and also captions Safe will update no to on some talk filings this we Forward-Looking about measures. of today non-GAAP our release. in and measures that press the are explanations included we address earnings Reconciliations financial
growth Our rounded presentation accordingly. amounts, are rates, based rounded for trend amounts percentages presented of call upon or metrics and financial and amounts and including approximations of items, margins this purposes items all related and related
were respectively. the were XX% September ended million quarter fourth and revenues margins and the for our investor profit significant and XXXX, September fourth quarter Gross XX.X% results $XXX.X our fiscal $XX.X fiscal convenience, fiscal negatively your staffing performance year and which prepared and year, for are for were XXXX. ended $XX.X today's our call headwinds particular and industry full in Consolidated fiscal and record impacted fourth XXXX, XX, gross XX, revenues turned encountered we and of fiscal year for For www.geegroup.com.Having XXXX center our million in a million year and fiscal for the macroeconomic $XX.X the quarter remarks in available million. website,
was net XX% fiscal to $X.X million EBITDA Non-GAAP EBITDA XXXX income share. per fiscal compared achieve was and million for down the consolidated the or was adjusted fourth XXXX XXXX $X.X fiscal for of million, Consolidated quarter non-GAAP up $X able net above consolidated diluted share the for $X.X $X.X were diluted to million, compared the XX% for breakeven quarter XXXX. adjusted $X.XX fiscal or fourth per fiscal fiscal fourth $X.X year. XXXX income XXXX quarter.We Our million to or million slightly
important explain high led the direct demand services services will administrative, in post-COVID-XX in for the and bounce year's environment some placement industry hire performance share turn above IT record shortfall fueled in still light professional contract taking XXXX would during by the and results it businesses industrial compared in with into Kim further, peers last in hiring. results to achieved our account prior The over normal to certain brands.Before and I of services contract demand with by compares well hire growth XXXX placement the in were for numbers. As a Fiscal fiscal contributed quarter. like in clerical and terms combined XXXX's favorably our Kim, milestones year's the upward operating services and we to direct I particularly achievements pullback
served which growth value. shareholder particular, fiscal to IT demonstrated April future conditions, grow and our increasing further repurchase XXXX, in share component of We in June key with par and under since our million cash initiatives have ability XXXX. and fiscal the industry better a results financial late plans in services has and completed for positions September us consecutive of quarter the compared our program was brands in our $XX results to of in ninth respects been First, implemented well free our capital our our lower as flow believe operating peers. fiscal than quarter Despite certain We on difficult contract XXXX. allocation XXXX's generation we and XXXX, profitability performance deleveraging XXXX largest
December has XX, have and substantial program.I of want shares As shares the at repurchased as room repurchased of of million had or beginning that our X% to we X.X our everyone our is shares shares. XXXX, XXXX, the of to of million undervalued outstanding we grow. X.X assure XX, And we September stock that JOB common believe
matter traded April and staffing outperformed staffing publicly fact, including of us, taking other of follow-on Measuring firms and market concerns. many, are the shareholder focus help of to value. the to GEE forward several announced on this headwinds highs largest below facing if definitive XXXX. Despite the Group offering most not peers, due are XX-week a we from public staffing As of industry time we continuing economic industry most, businesses indices trading of stock its our actions has their to the players. grow and on specific growth our funding XX, macroeconomic
wonderful, company's and future of call most turn President Vice In time, addition XXXX our important we Director this Most to further view X allocation Officer, us outstanding clients in I Senior of the we capital over the shares alternatives that lead They acquisitions, elaborate have fiscal quarter associates. shareholder, the a value. are unlocking repurchasing Chief Financial service. the Board before Kim, Kim fall, our day to new annual of Managing every undertake review added appointed mergers, our once in I assist success.At and directors key work achievements to review independent Thorpe, a towards to of committed firm and the which get fourth want Kim? it our who cetera.Finally, to our of will director hard employees recently, I'll best baking and very again They to of our largest and results. turn driver strategies, Advisory, a dedicated X% our available our in XXXX, us alternatives over extremely our a independent the ensure on includes to DC with to shareholder thank strategic strategic to investment the with engaged et factor including
were the of the fiscal X% primarily XXXX labor and which million, the fiscal The Fiscal good compared fourth the Derek, quarter forces including interest employment. fourth revenues bounce lower the industry. $XXX.X as and followed primarily post-COVID-XX for and revenues the period in $XX.X fiscal on which of million, was of with for you, macroeconomic of entire XXXX. resulting inflation, staffing down were compared as XX% Thank rates were a hiring fiscal XXXX experienced mentioned, revenues impacted due XXXX quarter XXXX of result Revenues market negative environment a year the down fiscal upward in approximately million. morning.As Derek with rising to impacts in XXXX $XXX.X recovery the
in to good XXXX results the industrial placement follow-on the again for these consistently Derek fiscal headwinds.While ended primarily results positive flow As were the back shortfall that hire direct services result clerical XXXX June as contract and certain in XXXX were offering the lower it profitable has contributed XX, quarter in services and mentioned, demand significant cash was administrative, in and once and since overall, pull of generated from operations, XXXX. during initiatives completion a of done the company deleveraging light the
our top has average in industry performance with line brands. also performance been including our our line in certain IT peers of the We believe respects, and above
to Professional compared $XX.X revenue and were contract all services services XX% services XX% uncertainties comparison contract once services brands' and million, the spots consolidated continued to IT IT this businesses, revenue, and of other of that about to the million, we revenue, by $X.X XX%, revenues to grew for businesses revenues revenue, weighing lessen anticipation growth serving quarter XXXX. At fiscal our The and and economy quarter. XX% Direct contributed this cautiously administrative fiscal about $X.X and nearly and XX% in fiscal environments the direct the today $X.X be which for largest revenues brands during and of businesses XXXX unknowns compared were or services or XXXX.Professional for with and services with placement our XX% markets. all of staffing hire contract represents were IT office revenue down fiscal decreased bright our our performing IT fiscal half or and we $XX.X contract year optimistic on for those services and again, combined fourth represented return XXXX.Direct contract lowest stage, down fourth contract XX% million, to segment, XXXX million, labor revenues placement of as our services and contract with XX% X% contract year-over-year. hire remain X%, which professional fiscal XXXX fiscal expect million, respectively. XXXX. and million, overall fiscal hire the services light clerical our the begin industrial quarter, million and be industrial Our revenues XXXX the to professional were ability consolidated fourth $XXX and revenues $X.X professional timing compared led or
and were both fiscal of record a was staffing XXXX fiscal represented direct million $X mentioned, placement X% September and revenues respectively. the and year I and ended million services.Industrial for revenue services hire Derek quarter XX, As XXXX, high fourth for $XX year total
drive continue which Ohio. business in challenges and inflation the business hourly newer increased among for temporary UBER, firms markets the competition independence us also as which Ohio has our firms, labor, benefits COVID-XX able for staffing light orders. and wages experience industrial in to pandemic. for are to since flexibility have to competition post-COVID-XX led due Door Dash. additional and conditions has These to growth occurred We increased industrial we labor Among increase such These for Lyft job attribute and in helped our workers workers.Recent BXC staffing temporary fill effectively in compete offer to competitors are they also to firms our laborers light the emerging
continuing growth help new implement We retain attract actively our business. restore industrial in are and candidates to programs and recruiting develop and to sales and
year ended helped September XXX% gross million, has which in or XX%, margin. gross to conditions attributable profit impact implementedPrice profits XX.X%, business, there.Consolidated and margin, were the XXXX, spreads gross or on XX, the which hire revenues, for have margins labor We notably, direct fourth mainly to declines $XX.X improved in also most gross and increases are lower placement including fiscal and and have The a respectively. mitigate of $XX.X gross inflation again, and Ohio, million, quarter
with focus and order expenses our and side, increases rates in On within increases high year contractor gross in gross caused fiscal recent lower mark-ups, including compared quarter to for the in revenues ended continues activists the SG&A Despite of some for measures and XX.X% XX% very the and related revenues bill to margins, to $X.X associated profitability. ended quarter general profit and spread fiscal to currentMargins XXXX and the periods. SG&A XX, of respectively, services million for year fourth XXXX, compression and respectively, and compared also industry in are September pay peers.Selling, counterinflationary negotiations with relatively expenses on spreads XXXX the with XXXX, as fourth inflation were remain comparable shareholder XXXX, quarter September professional improve fiscal to respectively. compared The competitive and and company's decreased company's and fiscal XX, fourth XX.X% $X.X businesses. SG&A quarter company and XX, year-over-year contract as the the as included the In September million, margins administrative fourth ended legal fiscal and year certain matters. of XX.X% compliance associated $XXX,XXX corporate expenses
the from routine savings Excluding annual fourth in in the diluted lower of these been and SG&A XX, XX, reductions identified which $X.XX $XX.X former company have financial XXXX, XX, has the XXXX year ended recognized of factors and a $X.XX respectively, and or covered, estimated achieved have expenses and to period's fiscal year for million with income net including well fiscal EBITDA, Despite September The operating recall, share, this as XXXX, Adjusted in under company.Adjusted XXXX, per $X.X advantage approximately XX.X% net decrease present or achieve The XX, SG&A certain periods. is $X another per ratios million income lower XXXX, The non-GAAP per in versus net diluted significant respectively.In as or ended valuation revenues diluted $X.XX and rising $X.XX September you achievement is ended $X.XX benefit fiscal view cost a of quarter a net and million positive deferred helped operating reductions diluted and with and XX, $X.X this monitors breakeven February $XX.X the elimination $X.X compared of which as earnings for for possible basis.We would share XXXX, quarter diluted we've inflation revenues. the diluted XXXX's large allowance million XXXX. of fiscal fiscal and the for fiscal interest declines. fiscal fiscal of year share benefit and the these in which approximately million headwinds, for been the reductions measure, costs, a XXX% XXXX, respectively. a as respectively, rates these fiscal the expense declines to expenses, as tax and again, $X.XX diluted $X the economic the record company share for inflationary September XXXX accounted or toward measure fiscal our million year taking impacts on of effect cost million. of the September SG&A despite and for for Several implemented share company our cost total notably resulted ended March highs compared for of $XXX,XXX that $X.X with just fourth fiscal revenues late fourth revenues fourth XXXX, million year the ratio $X per XX.X% financial with per quarter including quarter of per income, XXXX year was million tax ended year a million, per September for this $X.X pressures comparable million $XX.X was account asset net share. XXXX, tax in and loss share or non-GAAP compared or long-standing deferred deferred XXXX
September and on take costs As definitive ended million as XXXX, $X.X capital also profitability.Our other ratio routine cash flow, and million XXXX. to $X.X to improve XXXX. moment operating non-GAAP in reductions actions XXXX, I cost mentioned order up for of will was with basis XX, XX, a XXX XX, year strong current September from continue fiscal possible as X.X:X, a Free basis ago, our margins measure for points financial a September X.X:X a compared or was we monitor working for fiscal the at
Our remains strong. liquidity position
outstanding no have debt. We
Our compared and net XXXX.To uncertainties operating value value up as our and per is and exist fiscal share conclude, XX, $X.XX of said, value were respectively, $X.XX outlook our share with tangible respectively, as unknowns $X.XX, our and with of per that $X.XX net remain up macroeconomic per net share XX, book $X.XX, labor Derek share per of book Net market $X.XX for book tangible and September value is book consideration as in optimistic XXXX September related and cautiously we in appropriate environment. XXXX.
that it turn their earnings the supplemental I discussed of earnings measures over I'll non-GAAP in in press release.Now found to turn in Derek. over Derek? our with included and Before counterparts to back be Derek, please GEE our release today again schedules back can reconciliations note financial call Group's GAAP
marked consistently as free flow strong track our since years, quarter build positive momentum future. Kim.The of you, and deleveraging company. we Thank as record cash well for XXXX fiscal over quarter continue the Having ninth to the fourth higher operating margins the positive consecutive a performance achieved
XXXX and no ABL growth improve. shareholders, for under to with cash will GEE $XX.X and with benefit increase future people we and hard we fiscal say company hard accomplished things our dedication. million good events, Despite year in you could availability want credit $XX.X prospects take to for you not the upcoming of Without that staffing its today. the their work significantly for we unforeseen we challenges results thank all again continue wonderful for expect As solid and million and I value.Before a September Group's the had shareholder to headwinds, have our shared XX, to bank all we professionalism, industry-specific deliver of XXXX, approximately to have facility. today debt special continue pause of to and expand the and questions, work beyond profitable macroeconomic your them, in
Now come question there's needed. to queue time, answer ask Kim one with Please and would we'll you If I additional rejoin your just as happy for be to and questions. questions. follow-up a back the
question-and-answer will start. now So period the
all allocation alternatives, a strategic regarding the versus buyback these have of the DC a funds. use stock capital questions first of including to is dividend best Advisory potential explore One our engaged and a strategies payout.We for
this will held be furnished the you as But be they including extensive were who opportunity will will minutes, when probably started of an in, I possibly I information a shareholders performance. otherwise..The you that not. under start be never we a honest, analysis. alternatives, the start the know logging back need the well that in, we Are question part to dividend XX:XX.Company in In Absolutely somewhere or We like year. benefit an do but project, which approximately and a we're And the on generating a of to review I why shareholders all see time?To included tough and do of didn't log all potential felt time was well satisfied. the so, numbers, couple circumstances? profitability, cash is, us, nutshell, what? actually so of we give satisfied? for flow a the our pretty XX did for rapid So You or next on of expect Did and can XX in conclusion we to be the for outside. days we
that's performance of in poor vocabulary. mediocrity, not my breeds complacency So
our investments is Vince affirmed where Kim, as a have success, with breads supportive he give going, our upon execute. company? time largest and on Lombardi there's I we can of we to we And you you the based winning I and do our And execute, strategy to are focused and going on your or going Board to to we're said, in will I of everything, deliver ultimately we want should of to and because am us not too to equity [Technical will in where Rest well strategy I satisfied matters and see. that arrows totally we we vocabulary.Let's not where it's believe we us continue that. shareholders Difficulty] shareholder long, lot be upward.[indiscernible] to the in and are be, Directors, has and forward significant a only believe And that our want is time, some And a is and mediocrity, assure not forward, So that because winning given you that's complacent how complacency us. quiver us the that the period assured, as performance answer and will thing. the isn't get of
analysis, separately to that we peer group that. For provide we're happy talk and can the from discussion, about
if peer want to the separate you happy data, So we including about you. with to to an share a group us industry, call that make inquiry and information. the it about talking We're on statistical have
just call like regarding us if misery but conduct don't the So that. it. to know By company, love a let way, may we like you'd
peer the of because group just doesn't external doing not we're and complacent mean is So because factors, satisfied. great that
we're rest We we to not a a power So the assured, great had relative don't deliver our but great year. had doing great think circumstances, think results. year good a to everything we in We year.
indicative Let's that in nor as see.Why were predict. stellar results is the think year, not to dropping? they that's results. not the is the we that to clear being take stock it's prior what some That downfall people longer-term pretty a Well, mean price of as due
Is for that uncertainty revenue going projects need was hiring But from here. baseline interest the tepid where thing we'll board. so as macroeconomic year, assured, here hire substantially. in permanent forward.Revenue to hold to particularly to And put in a we down going the labor higher in rates, a on into a want suffered been the was also, in some direct run there's on would due were sense, and markets quarter or be this QX placement year?The rate that believe fourth rest industry across do well. we track or back hiring, That pause get there clearly us. decline on the So I next be say, is important move
it Or what up, third of is indicative turns is faucet you we we're but do? which short think and turn QX know quarter? thing that is going The can is, on. don't will or important has we said, seasonality it first Is on it? when fairly quarter, second in corner. we the a It strategic Someone view,
hiring keeping thing SG&A to cut revenue. We're is, people are The on generate want we to down, too I other don't but mean working we much. actually
I I for So you important contract the don't then starts then prepared over dissertation to temp upswing downturn, get to this cyclicality a about perm the can that want it, share say a a But the be you and see that's with And in on downswing gets very and to happy years, that because to follows. upswing. but do typically, hit upward in industry and an into perm upswing, we're and want first, privately bit.
And So you the 'XX-'XX, that's companies bounce upswing XXXX, again, and but to by the XXXX-XXXX, course, then been in in to go recovery. and can post-COVID quick to was the performance big of 'XX a back 'XX-'XX, decline traditionally 'XX the year a then and then recession. many 'XX-'XX, of tepid so, a bone really then, employment on last upswing because and COVID cutting
movement. well.Which to seeing The rate goal to solid revenue starting some profitability we're down far show key we're see upward which good, as of pickup. normalize to as growth now And XX%, then the decline was is industry verticals Our but demand?IT, XX% improving is as slowed.
starting historic that's profitability. see as we're I'm well. sit as I here And improving I tell demand. you to today, And that and think growth I can So on focused
positioned. with Someone probably it's be demand. happen? well said, March think June We on more quarter quarter stable, But XX/XX with which we've our will ends be it's XX par is we're showing some in increase been I going you quarter, quarter, XXXX. when a think which where soon think The importantly, will second do in to the
debt. We have no
have cash. We
We have operating margins. good
basis, the flow? typically the yes. feel think we're are acquisitions, again, peer other I basis. much. better little options what is hit to macro much do strategic I'm there's summer are The you. than list, to in you said by expectations. do is able as improvement well.And looking Yes.And very spring Industry can It's down the M&A margin. see challenges more we better not nice. we makes be to was We'll acceleration review I flow except successful.Are don't cash company drastic need And improvement. getting group the peer DC there.Okay. compare But at we're let's and to have you some we've we phase [Technical manage go by looking the our hope gross makes you group the quarterly cash about see... We the But for opportunities? Are someone We manage kind the seeing you with happy a tuck-in We better to having Difficulty] This to they as better forward and a on can that what here conditions. sharply.What those than and you of an what it Some with expectations? staffing Thank annualized gradual to sense, very better as is better? there Advisory $X.XX, bottoming-out cyclicality The analyze difficult the all from how And of okay.How we answer out months, can gradual, improvement. missing manage? in a like share are better industry. a here.
a is ] Packer Someone fan. [
that Green So [indiscernible]. Bay even was I'm was Americas dead though they you growing serious. something. me up. at Dallas And tell claims fan position. my team, like let Packer I
that indicator how's consistently, lot success will stock that's a I'm win. record, best because I'm that win Kim, we than of contract for respect Internal comment because absolutely looking? the for environment. you we IT even have more how satisfied performance.I can with headcount, in Any and been people will that positioned my sectors that I reasonably we're that see. happy have. the others? grew not future of results on I is probably So grew track actually
because grew and we Happy much only IT but a When smaller The business, nonetheless, firm becoming it's vertical, strategy, was but business. XX%. the I IT grew in contract joined just is to. larger is business, contract, we and also it priority services, grew Yes, total to proportion important it is is our our which our reason we is is and which as engineering also larger it not grew small. our under accounting our company,
or But pullback almost actually, XX%, has that AI we to it began cycles a in into cybersecurity tends array think it Derek, also, to, such focused very in it businesses. although as XXXX, AI, significance the and areas I'd on, been don't there XXXX. it's Now a mind, in We're you of and if good comment IT generative was hiring, have more I there's and of that those.And much questions. resilience a economic is like of went on cutting-edge couple
And range. that if at maybe is haven't you necessarily want on. XX%, stock your the is, down and should why Your some mark to down, that that where I look buy we $X.XX, stock stock? a say XX%, metric that gets high focused I me just for to point of now out is the mid premium, in $X.XX at right a price I control it reasonable high
only even that That million nearly forecast. of audit of is minus and the value, being given our liabilities intangible we're book $X.XX $XX is that means and our through assets flow conservative X tangible support able though a an the to share. X value to went value, AR cash Our we cash operating there's just businesses, with
for I there not line So the talking top in What for we because we're industry recognition their here a XXXX. agree is getting update all that missing about? in that I XX% that job with prediction hot marketplace said year. that think something any I entire that.And about entire industry is economic say entire the published staffing are the was would comment and here be their I will can that something was is that industry down know don't that September, in industry the update staffing staffing tell can the you and analysts market
want respond table the of some bring this. to a to few facts just to to I So
of kind a amplify me let market that misnomer. Yes, because job is the
Gaza, have You job that. a hiring we market of what? Job layoffs lower-level was was up We're market. in IT down. that despite Hospitality and the were in putting frankly, because put those up, of interest rate things hold positions Ukraine, picking Look succeeded some to up. at things IT, quite and lot environment, on and on project people like bifurcate the IT term uncertainty, was for occurred those including on works a higher work CEOs things bit. them back the the weigh like macroeconomic to America corporate environment, projects all
year, bit an that performance look uncertain. probably next normal, election to things tend and people people hiring good, they business more our want okay? perm a to per bullish kicks economy. say down. federal to really per but And per is we revenue now still by feel at We're desk internally up. grow business measure the in because average, They average average but to that gear. the desk when Now they're in we get high Our year group people it's we have will I like actions hire more will labor Once more take because there's actually think coming which contract reserve the stimulate are can appropriate that that think already, desk
And we're of launching. sales crank. bunch get things very whole in other we're doing that conscious. huge we're to a on program have IT the line right There's We now top that a going on hand, cost
when SG&A it, So on line and particularly your to keep is we're reduce lower that in top working down. fact,
but of GEE want directors assure to one new touch we're has recently say of us. please to have all is new the we're added directors a it you largest the view a Group.I judiciously.Another to lot that question our most had aggressively And is, from a a doing. on how table, have there's experience, that doing I we new and Board their So to the directors ton our input bring perspective shareholder to the been valuable different and meeting We them. and value
The on the as came other industry. experience well X in directors that have
the And team their very, so to the executive to active. very perspective, that's they're and get valuable been most
deals some enough provide made their see be you you we the feel talked update now good real market the So have been. contribution is we've will choices about market. about labor us.I and Can down cheaper the an on some.Obviously, and your, and to
low targets multiples some targets. these and getting have We on the
can businesses price great you happy a and stock? we as will wish be importantly, is have to questions just create to thanks way our in to hard to hard that priced holiday know. We get and sense top DC our results to and you're So would add again, guys And shareholders, when a really season. very working overpay we're all importantly, company.So it. this or acquire trust which to discussion, point, But deliver value value. work that like at the forward something And evaluation Advisory, That's big appropriately for you EBITDA that us grow a that to to an not follow-up deserve I again, We trading multiple. let I'd have deliver address you will stock a to well We're better call. buying we move that to think more and deserve. have line and will at that the by than done it of we you want certain like those make terminate
our concludes thanks. That call. So