UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 001-35636 ASGN Incorporated (Exact name of registrant as specified in its charter) Delaware 95-4023433 (State of Incorporation) (I.R.S. Employer Identification No.) ...

ASGN Incorporated (NYSE:ASGN) Q1 2025 Earnings Conference Call April 23, 2025 4:30 PM ET Company Participants Kimberly Esterkin - Vice President of Investor Relations Ted Hanson - Chief Executive Officer Shiv Iyer - President Marie Perry - Chief Financial Officer Rand Blazer - Executive Vice Chairman Conference Call Participants Tobey Sommer - Truist Securities Mark Marcon - Robert W. Baird Kevin McVeigh - UBS Trevor Romeo - William Blair Jeff Silber - BMO Capital Markets Surinder Thind - Jefferies Joseph V ...

分组1 - ASGN Inc reported quarterly earnings of $0.92 per share, missing the Zacks Consensus Estimate of $0.95 per share, and down from $1.16 per share a year ago, representing an earnings surprise of -3.16% [1] - The company posted revenues of $968.3 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 0.24%, but down from $1.05 billion year-over-year [2] - ASGN Inc shares have declined approximately 30.3% since the beginning of the year, compared to a decline of -10.1% for the S&P 500 [3] 分组2 - The current consensus EPS estimate for the coming quarter is $1.25 on revenues of $1.01 billion, and for the current fiscal year, it is $4.88 on revenues of $4.01 billion [7] - The Zacks Industry Rank for Computers - IT Services is currently in the bottom 42% of over 250 Zacks industries, indicating potential underperformance compared to the top 50% of ranked industries [8]

Q1 2025 Earnings Supplemental Materials Safe Harbor Certain statements made in this news release are "forward-looking statements" within the meaning of Section 27A of the Securities Exchange Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking information includes estimates of the company's future financial and operating performance. Certain data and statements in this presentation, other than those setting forth strictly historical information, are fo ...

Financial Performance - Total revenues for Q1 2025 were $968.3 million, a decrease from $1.05 billion in Q1 2024[5] - Net income for Q1 2025 was $20.9 million, down from $38.1 million in the same period last year[9] - Adjusted EBITDA for Q1 2025 was $93.6 million, representing 9.7% of revenues, compared to $108.3 million or 10.3% in Q1 2024[10] - SG&A expenses increased to $214.5 million from $210.2 million in Q1 2024, including a $4.4 million write-off related to software enhancements[8] - Cash provided by operating activities for Q1 2025 was $16.8 million, a decrease of 77% from $73.3 million in Q4 2024[24] - Free Cash Flow for Q1 2025 was $6.6 million, down 89% from $62.5 million in Q4 2024[24] - Net income for Q1 2025 was $20.9 million, a decline of 45% compared to $38.1 million in Q4 2024[26] - Adjusted EBITDA for Q1 2025 was $93.6 million, down 13.5% from $108.3 million in Q4 2024[26] - The company expects net income for Q2 2025 to be between $29.3 million and $34.3 million[28] - Adjusted Net Income for Q2 2025 is projected to range from $45.5 million to $50.5 million[28] Revenue Segments - IT consulting revenues accounted for approximately 61% of total revenues, up from 56.7% in Q1 2024[6] - The Commercial Segment generated revenues of $672.2 million, down from $731.5 million in Q1 2024, while the Federal Government Segment revenues were $296.1 million, down from $317.5 million[5] - New bookings in the Commercial Segment for the trailing twelve months were $1.3 billion, with a book-to-bill ratio of 1.1[3] - New contract awards in the Federal Government Segment for the trailing twelve months were $1.5 billion, with a book-to-bill ratio of 1.2[3] - The company reported a book-to-bill ratio for the Commercial consulting business, indicating strong demand for new contracts[33] - The company anticipates continued growth in the Federal Government Segment with new contract awards expected to contribute to future revenues[34] Acquisitions and Investments - The company completed the acquisition of TopBloc for $340 million, financed with 90% cash and 10% equity[11] Future Outlook - The company expects Q2 2025 revenues to range between $985 million and $1.015 billion, reflecting current market conditions[12] - Total assets increased to $3,698.4 million in Q1 2025, up from $3,429.0 million in Q4 2024[24] - Long-term debt rose to $1,282.6 million in Q1 2025, an increase of 24% from $1,033.5 million in Q4 2024[24]

Core Viewpoint - ASGN Inc is positioned well to potentially beat earnings estimates in its upcoming quarterly report, supported by a strong history of surpassing expectations in previous quarters [1][6]. Earnings Performance - ASGN Inc has consistently exceeded earnings estimates, averaging a 5% beat over the last two quarters [2]. - In the last reported quarter, ASGN Inc achieved earnings of $1.28 per share, surpassing the Zacks Consensus Estimate of $1.23 per share by 4.07% [3]. - In the previous quarter, the company reported earnings of $1.43 per share against an expected $1.35 per share, resulting in a surprise of 5.93% [3]. Earnings Estimates and Predictions - There has been a favorable shift in earnings estimates for ASGN Inc, with a positive Earnings ESP (Expected Surprise Prediction) indicating a strong likelihood of an earnings beat [6]. - The combination of a positive Earnings ESP and a Zacks Rank of 3 (Hold) suggests that ASGN Inc has a nearly 70% chance of delivering a positive surprise [7]. - Currently, ASGN Inc has an Earnings ESP of +0.35%, reflecting increased analyst optimism regarding its near-term earnings potential [9].

Financial Performance - Revenues for 2024 were $4.1 billion, a decrease of 7.9% year-over-year, with the Commercial Segment contributing $2.87 billion (down 9.6%) and the Federal Government Segment contributing $1.23 billion (down 3.5%) [128] - Gross profit declined 7.5% to $1.18 billion, with a gross margin of 28.9%, reflecting a higher mix of Commercial consulting revenues [134] - Net income for 2024 was $175.2 million, down from $219.3 million in 2023 [139] Expenses - Selling, general and administrative expenses were $821.2 million, representing 20.0% of revenues, down from 19.0% in 2023 [135] Bookings and Contracts - Commercial consulting bookings were $1.28 billion, down from $1.35 billion in 2023, with a book-to-bill ratio of 1.1 to 1 [142] - New contract awards in the Federal Government Segment increased to $1.34 billion from $1.02 billion in 2023, with a book-to-bill ratio of 1.1 to 1 [144] - Funded contract backlog was $529.0 million, while the total contract backlog was $3.12 billion, reflecting a coverage ratio of 2.5 to 1 [144] Cash Flow - Cash and cash equivalents at year-end were $205.2 million, with working capital of $550.6 million [145] - Net cash provided by operating activities was $400.0 million, down from $456.9 million in 2023 [146] - Net cash used in investing activities was $35.3 million, primarily related to capital expenditures [147] - Net cash used in financing activities in 2024 was $333.2 million, primarily for stock repurchases of $327.2 million and principal payments of $5.0 million on term loan B [148] - In 2023, net cash used in financing activities was $310.9 million, including $273.1 million for stock repurchases and $31.5 million in net repayments under the revolving credit facility [148] Debt and Obligations - Long-term debt obligations total $1,300.7 million, with $62.0 million due in less than 1 year and $627.7 million due in 3-5 years [150] - Total contractual cash obligations amount to $1,418.3 million, including operating leases and purchase obligations [150] - The company had no off-balance sheet arrangements as of December 31, 2024 [153] Reserves and Liabilities - Workers' compensation loss reserves were $2.8 million in 2024, down from $3.0 million in 2023, net of anticipated recoveries of $10.5 million [151] - Deferred compensation plan liability increased to $17.8 million in 2024 from $16.6 million in 2023 [152] Interest Rate Sensitivity - A hypothetical 100 basis-point change in interest rates on variable-rate debt would result in an interest expense fluctuation of approximately $4.9 million based on $493.8 million of debt outstanding [155] Credit Facilities - The August 2023 amendments to the senior secured credit facility generated net proceeds of $8.0 million, offset by related amendment costs [149] - The company has undrawn stand-by letters of credit outstanding of $3.7 million as of December 31, 2024 [151]

Financial Data and Key Metrics Changes - For Q4 2024, total revenues were $985 million, a decrease of 8.3% year-over-year, but essentially flat compared to Q3 2024 [36] - Gross margin for Q4 2024 was 29%, an increase of 60 basis points from the previous year [39] - Adjusted EBITDA was $109.7 million, with an adjusted EBITDA margin of 11.1% [40] Business Line Data and Key Metrics Changes - Revenue from the Commercial Segment was $692.7 million, a decrease of 7.5% year-over-year, while consulting revenues increased by 6% to $284.7 million [37][38] - Federal Government segment revenues were $292.3 million, a decrease of 10.2% year-over-year, primarily due to lower-than-expected software license revenues [38] Market Data and Key Metrics Changes - The Federal Government segment maintained a robust win rate of approximately 90% for re-competed contracts, with a contract backlog exceeding $3.1 billion [27][28] - The company noted improvements in the Financial Services vertical, particularly among Big Banking clients, which are significant IT spenders [14][55] Company Strategy and Development Direction - The company is focused on advancing towards higher-end, high-value IT consulting solutions, with IT consulting revenues comprising approximately 58% of total revenues [6] - The acquisition of TopBloc is aimed at enhancing organic consulting growth and capitalizing on the growing demand for ERP implementations [24][25] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about improving business confidence, although a turnaround in IT spending has yet to materialize [8] - The company anticipates that new administration spending initiatives could lead to increased demand for its core solutions in AI, cybersecurity, and digital modernization [29] Other Important Information - The company plans to allocate free cash flow towards paying down debt post-acquisition of TopBloc, which is expected to close in late Q1 2025 [45] - Free cash flow for Q4 was $88.9 million, with a conversion rate of approximately 81% of adjusted EBITDA [41] Q&A Session Summary Question: Can you provide more color on Federal Government conversations regarding the new administration? - Management indicated that clients are still trying to understand the impact of the new administration, but there is a strong need for services in AI, cybersecurity, and IT modernization [60][61] Question: Have you seen any slowdown in awarding contracts or payments? - Management noted that while there are mixed signals regarding new awards, they have not seen a slowdown in payments [64][66] Question: What are your thoughts on the TopBloc acquisition and its strategic importance? - The acquisition is seen as accretive to growth and margins, with significant opportunities in the Workday ecosystem [70][78] Question: Are there signs of improving activity in client budgets? - Management observed encouraging signs in certain sectors, particularly financial services, indicating a potential uptick in IT spending [79][83] Question: Can you elaborate on the performance of the Financial Services vertical? - The Financial Services vertical has seen a slight recovery, with current revenue mix in the high teens, compared to 20-25% historically [88][91] Question: How did Creative Circle perform in the quarter? - Creative Circle and CyberCoders, which make up about 9% of revenue, experienced a decline greater than the IT offering, consistent with previous trends [139]

Group 1 - ASGN Inc reported quarterly earnings of $1.28 per share, exceeding the Zacks Consensus Estimate of $1.23 per share, but down from $1.45 per share a year ago, representing an earnings surprise of 4.07% [1] - The company posted revenues of $985 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 1.61%, and down from $1.07 billion year-over-year [2] - ASGN Inc shares have increased approximately 4.4% since the beginning of the year, outperforming the S&P 500's gain of 2.7% [3] Group 2 - The earnings outlook for ASGN Inc is uncertain, with current consensus EPS estimates at $1.14 on $1.01 billion in revenues for the coming quarter and $5.50 on $4.17 billion in revenues for the current fiscal year [7] - The estimate revisions trend for ASGN Inc is currently unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] - The Computers - IT Services industry, to which ASGN Inc belongs, is currently in the top 18% of over 250 Zacks industries, suggesting a favorable industry outlook [8]

Financial Performance - Revenues for Q4 2024 were $985.0 million, down from $1.07 billion in Q4 2023, with IT consulting revenues at $577.0 million, representing 58.6% of total revenues[6][7] - Net income for Q4 2024 was $42.4 million ($0.95 per diluted share), compared to $50.3 million ($1.06 per diluted share) in Q4 2023[9][10] - Adjusted EBITDA for Q4 2024 was $109.7 million, or 11.1% of revenues, down from $121.0 million (11.3% of revenues) in Q4 2023[10] - Revenues for the three months ended December 31, 2024, were $985.0 million, a decrease of 8.3% from $1,074.1 million in the same period of 2023[21] - Gross profit for the same period was $286.0 million, down 6.2% from $304.9 million year-over-year[21] - Net income for the three months ended December 31, 2024, was $42.4 million, a decline of 15.5% compared to $50.3 million in the prior year[21] - Basic earnings per share decreased to $0.96 from $1.07, reflecting a 10.3% drop year-over-year[21] - Cash provided by operating activities was $100.2 million, down from $116.4 million in the previous quarter[23] - Free cash flow for the three months ended December 31, 2024, was $88.9 million, compared to $109.2 million in the same period of 2023[23] - Total assets decreased to $3,429.0 million from $3,544.6 million year-over-year[23] - Long-term debt remained relatively stable at $1,033.5 million compared to $1,036.6 million in the previous year[23] Future Projections - For Q1 2025, the company estimates revenues between $950.0 million and $970.0 million, with an expected net income of $27.8 million to $30.7 million[12][13] - The company expects net income for the first quarter of 2025 to be between $27.8 million and $30.7 million[27] - Adjusted net income for the first quarter of 2025 is projected to be between $40.2 million and $43.1 million, with diluted earnings per share expected to range from $0.91 to $0.97[27] Shareholder Actions - The company repurchased 0.5 million shares for $43.9 million at an average price of $90.45 per share during Q4 2024[11] Business Growth and Strategy - The commercial consulting revenues grew by 6% year-over-year, with a book-to-bill ratio of 1.1 in both the commercial and federal government segments[3][4] - The company announced a definitive agreement to acquire TopBloc, LLC for $340 million in cash and equity, enhancing its ERP capabilities[4] - The book-to-bill ratio for the Commercial consulting business indicates the ratio of new contract bookings to revenues, reflecting business growth[33] - For the Federal Government Segment, new contract awards represent estimated future revenues from contracts awarded, with a corresponding book-to-bill ratio[34] Financial Metrics and Measures - Cash and cash equivalents at the end of Q4 2024 were $205.2 million, with full availability under a $500.0 million Senior Secured Revolving Credit Facility[14] - The company utilizes non-GAAP financial measures such as EBITDA, Adjusted EBITDA, and Free Cash Flow to evaluate its financial performance, providing a clearer view of core business operations[29][30][32] - Adjusted Net Income is calculated to focus on ongoing core business performance by excluding non-operating and certain non-cash expenses, along with adjustments for amortization of intangible assets[31] - Revenues calculated on a Same Billable Days basis provide a more accurate year-over-year comparison by adjusting for differences in billable days[35] Leadership Changes - The company is enhancing its leadership team with the appointment of a new President, Shiv Iyer, effective March 1, 2025[4] Gross Margin - Gross margin for Q4 2024 was 29.0%, an increase of 60 basis points from Q4 2023, with the commercial segment gross margin at 32.6%[8]