And the main driver is going to continue to be mix pressure.
Operator: Your next question comes from the line of Kartik Mehta from Northcoast Research.
Kartik Mehta: Peter, just on trends in April, I’m assuming from the commentary you gave, the trends in April were very similar to what you saw in the first quarter. But I’m curious to understand if you look at throughout the first quarter, if you saw any change in trends?
Peter Quigley: Not really. I would say that it was a pretty — when we look at the monthly performance, the sequential month-to-month changes, I would say it was relatively consistent throughout the quarter. Probably a little too early to talk about the full month of April, but we didn’t see anything or haven’t seen anything that would cause us to change our outlook for Q2.
Olivier Thirot: I agree. When you look at our March exit rate, we are basically on par with our total Q1 trend. So far, we have not seen any significant changes that would lead us to say there is something changing in the market conditions.
Kartik Mehta: And again, from a similar standpoint, Peter, what are your conversations with customers, are they — just market not changing? Do you think as you talk to other people in the industry or your customers, have they come this area where just the market is kind of what it is and it’s flat and they’re not seeing any changes either? Or are you getting any inclinations that maybe things are starting to improve, they’re kind of accepting where we are and this is kind of the bottom?
Peter Quigley: Yes. I think what we hear from customers is not doom and gloom. It’s not that they’re discouraged by their prospects for business growth, going forward, probably the period of time they’re expecting it to happen, maybe pushed out a little bit from, say, December of last year. But customers are still optimistic and looking for ways to optimize their talent supply chain, optimize the — their expense structure. And all of that, long term, bodes well for Kelly because we’re right in the middle of that and can support their efforts to figure out how to optimize their talent strategies and supply the talent that they need to deliver their products and services. So I would say, no significant change, still positive on the future and maybe a little bit more optimistic or less pessimistic about a possible downturn.
Kartik Mehta: And then just one last question, Peter. As you look to transform Kelly, you’ve made a pretty large acquisition in MRP. And I’m wondering, does that mean for now or until you digest this acquisition that no more acquisitions? Or are you still looking? And are there opportunities that you’d like to pursue?
Peter Quigley: Well, I think we’ve got a large acquisition to manage in the near term. But that doesn’t mean we’re going to stop continuing to develop relationships and look for high-quality assets that could potentially complement the Kelly portfolio of businesses. We understand that the cycle time — the lead time actually, of finding high-quality properties, developing a relationship, avoiding a bidding process takes time. It takes a lot of hard work to do that, and we will not let up on that regardless of the amount of work that we will also put into making sure that the acquisition of Motion Recruitment Partners lives up to its very significant upside.
Operator: Your next question comes from the line of Marc Riddick from Sidoti.
Marc Riddick: I wanted to sort of maybe follow up on the last question to some degree. I was sort of curious as to given the size of the transaction that we’re looking at, is there sort of a general way we should think about how you’re looking at your balance sheet, going forward, comfort as far as leverage levels, financial flexibility and the like?
Olivier Thirot: As we speak, we have $201 million of cash and about $300 million of additional financing capabilities. So $0.5 billion liquidity. If you look at the projections, we have post acquisition, we are going to go to probably 2.3, 2.4 debt-to-EBITDA for a few quarters, but rapidly going below 2 and then below 1.5. We still have a strong balance sheet, and I think we still have opportunities if we deleverage as planned to go back to acquisitions knowing the lag time you have between starting some relationship and when some of them may come into fruition. But balance sheet-wise, I mean the cash we have now — the fact that our DSO now is at 58 days, which I think is great news, good management of working capital, cash flow generation, I think we are comfortable not only to get to this transaction with partly funding it in cash and the rest in borrowing, but we believe that we still have opportunities after that to continue on our inorganic journey, I think, pretty quickly, in fact.
Marc Riddick: That’s very helpful. And then maybe sort of as a tangent to that, outside of this transaction, are there sort of any thoughts or views as to maybe what that overall — sort of what we’re looking at as far as the general pipeline as far as valuations, competition levels from private equity and maybe just the availability of attractive targets? Maybe you can sort of give us an update as to what you’re seeing out there beyond the transaction you’ve already got on your plate now?
Peter Quigley: Yes. Thanks, Marc. I wouldn’t say the landscape has changed significantly. We haven’t reached maybe what I would call a thaw in the prior 12 to 18 months. There’s still fewer properties on the market and those that are, not always carrying the quality. But I would say there is more discussions happening. There’s more companies that are at least beginning to entertain discussions around possible combinations or exits, what have you. Private equity is still not at the level it was 2 or 3 years ago, but is beginning to show some interest in our space because I think people recognize that whatever the duration of this current industry environment is, it’s not going to last forever, and there is likely going to be a fairly significant upturn at some point. And I think companies recognize that now is a great time to consider adding high-quality assets to their portfolio like we just did.
Operator: [Operator Instructions] And at this time, there are no further questions.
Peter Quigley: Greg, thank you very much for your help, and we can end the call.
Olivier Thirot: Thank you.
Operator: Ladies and gentlemen, that does conclude your conference for today. Thank you for your participation and for using AT&T Teleconference. You may now disconnect.
