TrueBlue, Inc. (NYSE:TBI) Q4 2024 Earnings Call Transcript

TrueBlue, Inc. (NYSE:TBI) Q4 2024 Earnings Call Transcript February 19, 2025

TrueBlue, Inc. beats earnings expectations. Reported EPS is $-0.02, expectations were $-0.16.

Operator: Greetings, and welcome to the TrueBlue Fourth Quarter 2024 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. At this time, I would like to remind everyone that today’s call and slide presentation contain forward-looking statements, all of which are subject to risks and uncertainties, and management assumes 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 SEC filings, could cause actual results to differ materially from those in the forward-looking statements. Management uses non-GAAP measures when presenting financial results. You are encouraged to review the non-GAAP reconciliations in today’s earnings release or at trueblue.com under the Investor Relations section for a 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, a copy of the company’s prepared remarks will be provided on TrueBlue’s investor website at the conclusion of today’s call, and a full transcript of the audio replay will be available soon after the call. It is now my pleasure to turn the call over to Taryn Owen, President and Chief Executive Officer. Please go ahead.

Taryn Owen: Thank you, operator, and welcome everyone to today’s call. I am joined by our Chief Financial Officer, Carl Schweihs. We appreciate you being here with us. 2024 was a challenging year and I am incredibly proud of how the team navigated with agility and discipline. Our teams are doing tremendous work as customers seek improved market confidence before making significant adjustments to their workforce strategies. Uncertainty and caution continue to weigh on the staffing industry with reduced business spend and curbed hiring trends but we remain focused on the areas we can control. Our teams are staying highly engaged with clients to address their immediate needs with short-duration and flexible solutions, while also ensuring we are well-positioned to support demand as needs expand.

For example, our onsite business stepped in to serve as a supplemental staffing provider for an international transportation and logistics company and driven by the team’s exceptional service, we have expanded to serve as their primary staffing provider in 4 locations and their sole provider in 2 additional facilities. Another example comes from our commercial driving business where a long-standing customer requested our exclusive partnership to service their new account with a Fortune 50 technology company, resulting in our expansion to 10 additional sites across the Midwest. These examples demonstrate the strength of our client relationships and the agility of our teams in meeting today’s needs while also creating opportunities for growth.

2024 was also a transformative year for TrueBlue as we made significant progress executing on our strategic priorities and positioning the company for strong growth and expanded profitability when customer demand volumes return. We achieved a critical milestone in the digital transformation of our business with the launch of our new, proprietary JobStack app, allowing us to control our roadmap and continuously expand the value we bring to our customers and associates. We also delivered strong performance in attractive skilled markets, including commercial driving and energy work, and we made notable progress diversifying our RPO business in attractive verticals such as health care and higher skilled, professional placements. Our actions to simplify our organizational structure, including the sale of our on-demand labor business in Canada and consolidation of our onsite and global leadership structures, strategically position us to better leverage our inherent strengths as we look to capture growth opportunities ahead.

As we turn to 2025, we remain committed to capturing market share and enhancing our long-term profitability through clear strategic priorities focused on top-line growth and margin expansion, and as you may have seen, we are off to a fast start. We will continue to advance our digital transformation with a focus on enhancing the user experience and creating efficiencies. Our proprietary technologies, including JobStack and Affinix, allow us to accelerate innovation and implement enhancements quickly to address evolving user needs. For example, we recently introduced AI assisted, on-demand digital interviewing and self-scheduling using our Affinix technology which has shown to reduce processing times up to 7 days while JobStack’s latest ReadyMatch technology instantly matches job requirements with a pool of reliable, qualified individuals, making it easy for customers to invite the best-fit workers to the job and optimizing success rates.

The digital transformation of our business positions us to drive growth and expand our reach by combining our expansive market presence and expertise, with our proprietary technology to deliver a more customized, differentiated experience. We are also focused on expanding our presence in high-growth and under-penetrated end markets as well as high-value roles, to capitalize on secular growth opportunities. We continue to improve our strong position in skilled trades with our skilled staffing businesses outpacing the broader market in recent years, as well as our WorkUp and apprenticeship programs providing skill development opportunities for workers to build careers in skilled trades while bolstering our talent pool to fill critical market gaps.

We have additional opportunity to drive revenue expansion with our growing momentum in health care and professional services. Our recent acquisition of Health care Staffing Professionals marks a key milestone in advancing our strategic expansion in the health care space. We are excited to welcome HSP to the TrueBlue team as we look to realize untapped growth potential and enhanced value by combining their expertise and fastgrowing roster of long-term clients with our significant footprint, technology and recruiting agility. Our PeopleScout team also recently announced a landmark talent advisory win having been selected as a delivery partner to provide employer brand and candidate attraction services for the U.K.’s Armed Forces, further expanding our presence in the government sector.

With the traditional end markets we serve poised for growth and our continued expansion in underpenetrated markets, we are well-positioned for a strong rebound and accelerated growth. Another key priority is to optimize our business model to drive enhanced sales focus, ultimately accelerating our growth and improved profitability. We have simplified our organizational structure to eliminate silos and create efficiencies that brought our teams closer to each other and to our customers, resulting in increased synergies and cross-selling. For example, our PeopleReady and PeopleManagement teams recently won a joint pursuit serving a global, environmental services company to staff temporary warehouse positions as well as long-term supervisor, skilled and administrative roles which speaks to the strength of our teams as they work closer in collaboration.

Looking forward, we are focused on new and differentiating ways to enhance growth and capture demand. For example, in PeopleReady, we are aligning our on demand organization into territories that include one or more branches working in collaboration to grow our customer base. Sales representatives will be added across the country to implement targeted sales strategies in each territory and by the end of the summer, we will have increased the number of field sales representatives by 50%. The addition of dedicated sales representatives combined with focused responsibilities for both operations and sales, and complemented by the digital capabilities of our JobStack app, is expected to improve results across our on-demand field network. We will make this investment in a cost-neutral way thanks to our disciplined cost actions to create a more simplified structure.

Optimizing our business model allows us to better leverage our strengths and assets to deliver long-term, profitable growth. While current labor market dynamics are challenging, evolving workforce needs and structural staffing shortages create compelling opportunities for our business. The long-term staffing outlook remains positive and we are managing through the cycle with the discipline and agility needed to ensure we are strategically positioned for strong growth and profitability as conditions improve. We are excited about the opportunities ahead and are confident that our strategic priorities, in combination with our many strengths and assets, will enable us to advance our mission to connect people and work while delivering long-term shareholder value.

I will now pass the call over to Carl, who will share further details around our financial results and outlook.

Carl Schweihs: Thank you, Taryn. Total revenue for the quarter was $386 million, a decline of 22% with 6 percentage points driven by the extra 14th week in the prior year, resulting in a 16% decline on a comparable 13-week basis. As expected, temporary labor and permanent hiring volumes continued to be suppressed as clients remain uncertain of their workforce needs and cautious around business spend. While these factors led to overall softness in market demand, our teams continue to capitalize on growing verticals. For example, our commercial driving services delivered double-digit growth for the second consecutive quarter, and our PeopleScout team continues to outperform prior year in new business wins, especially in professional roles.

Gross margin was 26.6% for the quarter, up 50 basis points. Lower workers’ compensation costs driven by favorable development of prior year reserves contributed 170 basis points of expansion. This was partially offset by changes in revenue mix with more favorable trends in our lower margin, PeopleManagement segment as well as a decline in our highest margin business, PeopleScout, which drove a decline of 80 basis points. Pricing pressures consistent with the current market environment contributed another 20 basis points of decline and software depreciation now reported in cost of services drove another 20 basis points of decline. Keep in mind, software depreciation is non-cash and excluded from our EBITDA and adjusted EBITDA calculations. We reduced SG&A by 18% as we remain disciplined and committed to enhancing our profitability.

With the transition to our proprietary JobStack app, we accelerated the recognition of third-party software licensing fees associated with the previous version, resulting in $6 million of additional non-cash expense in the fourth quarter. This accelerated expense as well as other costs associated with upgrading our legacy PeopleReady technology are excluded from our adjusted net income and adjusted EBITDA calculations. On an adjusted basis, we reduced SG&A by 24%, outpacing our revenue decline as we continue to focus on the areas we can control. While our profitability traditionally expands quickly as revenue grows, our lean cost structure and improved efficiencies mean that we are even better positioned to deliver enhanced profitability as the demand environment rebounds.

We reported a net loss of $12 million this quarter, which included $2 million of income tax expense primarily associated with our foreign operations and essentially 0 income tax benefit on U.S. operations due to the valuation allowance in effect on our U.S. deferred tax assets. As a reminder, the valuation allowance has no impact on our operations, liquidity or debt covenants. Adjusted net loss was $1 million, while adjusted EBITDA was positive $9 million. Now, let’s turn to the specifics of our segments. PeopleReady revenue decreased 21% on a comparable 13-week basis, which includes 2 points of decline from the sale of our on-demand business in Canada. The extra 14th week in the prior year contributed 6 points of additional year-over-year decline, resulting in reported revenue decline of 27%.

Lower client volumes continued across most verticals and geographies. We have yet to see a meaningful shift in our overall sequential trends but we are encouraged to see momentum building in skilled trades with an improvement to underlying trends as we exited the quarter. PeopleReady segment profit margin was up 80 basis points, largely driven by favorable workers’ compensation reserve adjustments, which were partially offset by lower operating leverage as revenue declined. PeopleScout revenue decreased 30% on a comparable 13-week basis, which includes 8 points of decline from the client loss we discussed last quarter. The extra 14th week in the prior year contributed 1 point of additional year-over-year decline, resulting in reported revenue decline of 31%.

We saw reduced client volumes as businesses continued to navigate challenging market dynamics. Customers are hesitant to make significant adjustments in their workforce strategies as they face cost pressures and uncertainty around their workforce needs. While these factors led to subdued client volumes, our teams continue to outperform in new business wins, and we expect these relationships to drive further revenue expansion as customers’ hiring volumes return. PeopleScout segment profit margin was down 220 basis points due to the lower operating leverage as revenue declined. PeopleManagement revenue decreased 2% on a comparable 13-week basis with the extra 14th week in the prior year contributing 7 points of additional year-over-year decline, resulting in a reported decline of 9%.

The decline in demand was driven by lower onsite client volumes, consistent with the macro conditions in the verticals we serve. This was partially offset by continued strength in our commercial driving services which delivered its second consecutive quarter of double-digit growth. PeopleManagement’s segment profit margin was up 220 basis points, primarily due to disciplined cost management actions to drive improved efficiencies. Now, let’s turn to the balance sheet. We finished the quarter with $23 million in cash, $8 million of debt and $119 million of borrowing availability. We have diligently balanced strategic investments and returning excess capital to shareholders with maintaining a strong liquidity position to pursue growth opportunities.

This focused capital strategy enabled our recent acquisition of Health care Staffing Professionals, where we leveraged our strong balance sheet to take on a modest amount of debt at attractive terms to capitalize on the strategic opportunity. Health care Staffing Professionals, or HSP, was purchased on January 31 for $42 million with the possibility of an additional $14 million of consideration if favorable results are achieved over the next 2 years. We expect the HSP business to produce segment profit of $5 to $7 million over the next 12 months, which corresponds with a forward-looking multiple of 6 to 8x. We are excited to bring HSP into the TrueBlue portfolio as we work together to accelerate growth and enhance shareholder value. Turning to our outlook for the first quarter, we expect a revenue decline of 13% to 7%.

This includes 1 percentage point of headwind from the sale of our on-demand business in Canada, offset by 3 percentage points of inorganic growth from the acquisition of HSP. Our outlook reflects a continuation of current market trends because while there are encouraging signs for the new year, we have yet to see a definitive indication as to when overall demand trends will turn. We expect SG&A of $93 to $97 million, which represents an improvement of roughly $12 million compared to the prior year period as we manage through this market cycle with a commitment to enhance our profitability and to ensure that we are well positioned as conditions improve. Additional information on our outlook can be found in our earnings presentation shared on our website today.

Before we open the call up for questions, I want to turn it back over to Taryn for some closing remarks.

Taryn Owen: Thank you, Carl. As you have heard from us today, we remain committed to advancing our strategic priorities and managing through this challenging market cycle with the agility and discipline needed to ensure we are positioned to capitalize on the growth opportunities ahead. We are confident that we have the right people, technology, and resources to drive our strategic priorities forward, enhancing shareholder value and advancing our mission to connect people and work. This concludes our prepared remarks. Operator, please open the call now for questions.

Q&A Session

Operator: [Operator Instructions] Our first question is from Will Brunemann with Northcoast Research.

Will Brunemann: So congrats on the HSP acquisition. I was going to ask your press release referred to HSP as high growth. And I was wondering if you could tell us a little bit more specifically about your expectations on revenue growth, what HSP’s growth has looked like in recent years and how the pressures that are in the health care industry as experienced plays into expectations?

Taryn Owen: Thank you for the question, Will. We are thrilled to welcome the HSP team and customer base to TrueBlue. Although the health care staffing market has seen some pressure over the last couple of years, an aging population and secular growth offer long-term potential opportunities, making health care an attractive end market for TrueBlue that we’re excited to participate in. HSP has outperformed the health care industry growth rates over periods of both expansion and contraction, and we feel really good about their ability to continue that trend. They have long-term clients, many of which are in the government and educational sectors, which typically provide more stability through various market cycles. And then finally, HSP’s strong track record and niche service in the health care space opens doors for us at TrueBlue to expand into new markets, while at the same time, our geographical footprint, technology and recruitment sophistication will help accelerate HSP’s potential growth opportunities.

Carl Schweihs: And just to add a little bit on there, too, as you’re talking about revenue, we put this in the investor deck as well. But just over the next 12 months, we’ll have about 11 months of impact in 2025, Will, but we think anywhere between $75 million and $85 million of revenue and about $5 million to $7 million of EBITDA, really in the high single-digit margins higher than our traditional staffing businesses today.

Will Brunemann: Okay. Great. All right. I just have one more for you. If you could provide some more details about the U.K. Armed Forces contract, the revenue potential, the length of the contract and the margins as well.

Taryn Owen: Yes. Thanks, Will. We’re very happy to report that PeopleScout’s talent advisory team secured what is a significant new win to provide employer brand and candidate attraction services for the U.K. Armed forces. We’ll be one of several delivery partners for Serco, which is an international provider of government services, and this is part of a multiyear contract. The scope that we have here includes their recruitment marketing to fill the pipelines for hires across the U.K. Armed Forces. If you think about the British Navy, Royal Navy and the Royal Air Force are included here. 2025 and 2026 will be transition years with implementation work where we will see some revenue, but the full service of the contract will begin in 2027.

It’s a 7-year contract with an option to extend for an additional 3 years after that initial period. In terms of deal size, we expect them to be one of our top clients within PeopleScout. There’s some media revenue within scope, which comes at a bit of a lower margin, but the deal will be certainly a contributor to bringing PeopleScout back to double-digit segment profit margins.

Operator: Our next question is from Mark Marcon with Baird.

Mark Marcon: I’m wondering with regards to the PeopleReady business, can you discuss any sort of regional differences that you’re currently seeing? Any signs of improvement? We’ve certainly seen small business confidence indices improve. Just wondering if you’re seeing any of that translate to revenue at all? That’s the first question.

Carl Schweihs: Thanks for the question, Mark. Yes, let me just talk kind of revenue trends so far, and then I’ll let kind of Taryn add some color in there as well. As you kind of know, our largest geographic opportunity is California, Florida, Texas, right? That’s about 1/3 of PeopleReady’s trailing 12 months revenue. Our trends in California, Texas were pretty closely aligned to what we are seeing in our end markets. But we are seeing some improved trends in Florida during Q4. And we’ve also seen kind of some bright spots in specific markets that have not been impacted by weather throughout the country.

Taryn Owen: If I could add to that, Mark, we are encouraged by some positive trends that we’re seeing within PeopleReady here in the new year, where weekly sequential revenue trends have improved in February after a slow start in January, which was really impacted by the holiday as well as some significant weather that we’ve seen. Also important to note that we’re seeing some increased growth in our southern border states, along with a handful of other pockets around the country. We believe that the focus on migration issues with the new administration has impacted our demand trends positively over the last month. Our teams in those areas are reporting that our clients are experiencing some high absentee rates and turning to us to fill those jobs. So it’s a couple of weeks of data but we are certainly encouraged by those signs.

Will Brunemann: Taryn could you expand on that a little bit just in terms of how widespread that is and how much of a volume benefit you’re getting in some of those particular regions?

Taryn Owen: Let me — maybe I’ll just add on this one first, Mark. Look, I think it’s from a — it’s the first couple of weeks of February, right? They’re back kind of in line with sequential trends, which is a good thing after we talked about kind of that weather and holiday impact in January. From an outlook standpoint, I’d say if we see this continue, there could be some upside to our outlook. But I think it’s still too soon to call this a trend, as you know, with what we’re seeing. It’s hard to — it’s only a couple of weeks into February here.

Taryn Owen: Yes.

Mark Marcon: And then speaking of things that have been in the news, obviously, there’s been a tragedy in Southern California, parts of Western Carolina are still dealing with all sorts of issues. Did you see any sort of pick up in terms of business in terms of remediation of those disasters? Or are you not participating in that?

Taryn Owen: Yes. Thank you for the question, Mark. We are participating in that. Our PeopleReady business provides on-demand support in disaster recovery efforts. We are working to support those efforts in North Carolina and Florida. And in California, we have started the work now. We’re working with 14 different organizations that are focused on those cleanup efforts. And we would expect in the upcoming months in California as construction plans are approved and permits are awarded that PeopleReady skilled trades will play a role in the restoration and rebuild there in California as we are in Florida and North Carolina.

Mark Marcon: Great. And then any sort of commentary from an industry perspective in terms of areas of particular strength or weakness, particularly as it relates to PeopleReady?

Carl Schweihs: Well, I’d say one thing just is the skilled business for us continues to be a bright spot, right? We talked about this a little bit in prepared remarks as well, but kind of what we’re doing in energy, and then I’d also stated transportation, too, from an end market. So I think transportation and distribution, not just in PeopleReady, but across the portfolio for us has been doing better in Q4. And we’ve got a good foothold in that market and industry and expect for that to continue for us.

Mark Marcon: Great. And then just lastly, on the SG&A, you did a nice job in terms of…

Carl Schweihs: So we did — we overperformed a little bit of what our guidance was here in Q4. I think by probably 1 point. I think our adjusted SG&A was expected to be about down 23%, and we ended up being down 24%. It’s important to note that there was from a GAAP basis, just about $6 million of third-party software licenses that hit in Q4. That will be noncash in Q4 and an adjustment to EBITDA. But as you’re thinking about the longer term, we’ve guided to about a midpoint of $95 million, which is down about 11%. That includes about $1 million of SG&A for our HSP acquisition. I’d say as we kind of look forward to the year, — we’ll make some select investments as we find some opportunities for growth, but nothing material.

So I think that’s a pretty good run rate from a cost standpoint. You also asked just kind of where these have been. Similar to what we’ve talked about. This is about simplifying the organization, not where necessarily our field teams are closest to our customers and our associates, really looking at kind of support structure and others that we’ve mentioned where we’ve taken action.

Taryn Owen: If I could just add to that, one of the opportunities that has come from this is our ability to realign our PeopleReady on-demand organization into sales territories in a cost-neutral manner. So each of our territories will be under single leadership with a dedicated sales representative here moving forward. Those territories are going to be comprised of one branch or multiple branches working together to grow our customer base. So if you think about we have 480 branches today, those will be organized into 360 territories as we move forward, and we will increase our sales headcount out in the field by 50% by mid-summer. And again, some of the cost actions that we took have enabled us to do this.

Operator: Our next question is from Jeff Silber with BMO Capital Markets.

Unidentified Analyst: It’s Ryan on for Jeff. Just to start off with a quick numbers question. I was wondering if you could quantify the revenue guidance by the different segments? And then also if you had the exit rates coming out of the quarter.

Taryn Owen: Yes. Thanks, Ryan, for the question. So I’m going to just give kind of the midpoints here, right? We were minus 13% to minus 7% from a TrueBlue standpoint at the midpoint of minus 10% for TrueBlue. It’s important to note that, that includes a positive 3-point impact due to the acquisition of HSP at the end of January. But the midpoints for each one of our segments, PeopleReady, down about 16%; PeopleManagement, down 3% and PeopleScout, down 27%. Just another — a couple — 2 other reminders in there. Our Canadian divestiture is approximately 1 point of headwind for both TrueBlue and PeopleReady, and we’re going to lapse over those comps as we exit Q1 here. And then also the hospitality client loss that we discussed last quarter creates about a 1 point headwind for TrueBlue and about 8 points for PeopleScout, which we’ll lapse those comps as we exit Q2 as well.

Unidentified Analyst: And then just piggybacking on one of the prior questions. I was curious if you’re seeing a material impact yet from some of the Trump policies regarding deportation. And then if you have any outlook on how that might kind of trend as we progress through the year?

Taryn Owen: Yes. Thanks, Ryan. In addition to what I talked about earlier related to the PeopleReady business and some of that demand that we’re seeing due to increased absentee rates. We have customers across multiple industries that are increasingly performing internal audits to ensure that their workforce complies with the current regulations. Many customers and prospects are increasingly looking to TrueBlue to ensure that they have a workforce that’s authorized to work in the United States. And this has led to some of the new win momentum that we’re seeing, particularly in our on-site business. Just a note, in our on-site business, we’ve actually closed more deals in 2025 than in all of 2024. And we think that this focus on ensuring that the workforces meet the policy is contributing to that.

Carl Schweihs: And maybe just to add on to that one, too, Ryan. Just from a kind of a tariff perspective. In the short term, look, we don’t know how this is going to play out, but there could be some increases in input costs, other supply chain challenges that might affect some labor needs for our customers. But just as a reminder, TrueBlue has got about 25% exposure across our brands in manufacturing, and this is what we’re geared to support is onshore manufacturing here. And so we feel good about the long-term nature of where we’re positioned and what that ultimately could do for our business.

Operator: Our next question is from Marc Riddick with Sidoti.

Marc Riddick: So I wanted to touch a little bit on the acquisition — and congratulations on HSP. I was wondering if you could touch a little bit more both on the attractiveness of the health care market, which seems encouraging. I think also there’s a regional mix component that’s expected to be beneficial. And then maybe on a broader scope, you can maybe spend a little time on thoughts around the current — maybe what the acquisition pipeline looks like within the space and maybe levels of attractiveness at this point.

Carl Schweihs: Yes. Thanks. So we’re excited about this one. Thanks, Marc. I’d just add this, right? HSP is going to be immediately accretive to our financials, right, from a P&L and a cash flow standpoint. We took on a bit of debt here on a variable term loan that will carry anywhere from 6% to 8% interest. So think about a couple of million, $2 million to $3 million of interest expense a year. And this business should be able to generate anywhere between $5 million and $7 million of EBITDA. Also, just from a kind of a synergy standpoint, this is all — this would all be kind of upside to our kind of initial valuation. We think that there’s a lot of opportunity with our expansive recruiting network within our PeopleScout business to help assist and fill their exclusive open orders.

In the longer term, we think that there’s some opportunities to joint bid on non-health care roles. So think of what we’re really good at in our PeopleReady business, janitorial and cafeteria type works with their current and future prospects. And I’d also say just from a cost synergies perspective, anything that we’d be able to save here, really the intent would be redeploying any of those savings into additional investments in growth resources to help accelerate the growth trajectory that HSP is experiencing.

Marc Riddick: Great. And then I was wondering if you could spend a little time talking about sort of the progress you’re making with the JobStack rollout.

Taryn Owen: Yes. Thanks for the question, Marc. As you know, last year, we successfully rolled out our new proprietary JobStack app, which really positions us well to control our road map and ensure that we are addressing the needs of our users. Our road map for 2025 includes significant enhancements really designed to increase operational efficiency, improve sales effectiveness and drive revenue growth by delivering just a continued enhanced customer experience. Just a couple of things that I’ll call out that have been successes so far. One, we rolled out our ReadyMatch technology within JobStack that instantly matches job requirements with a pool of candidates and makes it really easy for both our customers and our field to invite best fit workers to the job.

We launched our digital onboarding experience that allows our candidates to quickly join our workforce. We’re also able to now onboard customers in a completely digital manner if that is the way in which they choose to engage with us. Our customers are able to enter orders in a digital manner and have immediate access to our associate base. And finally, we’ve also added a customer and associate referral program that allows both our customers and associates to refer to PeopleReady.

Operator: There are no further questions at this time. I would like to hand the floor back over to Taryn Owen for any closing comments.

Taryn Owen: Thank you, Operator, and thank you, everyone, for joining us today. I want to take another moment to welcome our newest colleagues at HSP to the TrueBlue team. We’re excited to have you on board and look forward to working together. I also want to take this opportunity to thank the entire TrueBlue team for their tremendous efforts in providing our customers and associates with exceptional service and their dedication to advancing our mission to connect people and work. We look forward to speaking with you all at upcoming investor events and on our next quarterly call. If you have any questions, please don’t hesitate to reach out. Have a great evening.

Operator: This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.