TRUEBLUE REPORTS FOURTH QUARTER AND FULL-YEAR 2025 RESULTS TACOMA, WASH. - Feb. 18, 2025 -- TrueBlue (NYSE:TBI) today announced its fourth quarter and full-year results for 2025. Fourth Quarter 2025 Financial Highlights Commentary "We delivered our second consecutive quarter of organic revenue growth driven by continued momentum in our skilled businesses and greater stability in broader demand trends," said Taryn Owen, President and CEO of TrueBlue. "As we continue to drive top-line growth, we remain equall ...

Core Insights - Nexalin Technology, Inc. has launched its AI-designed virtual clinic platform, NeuroCare®, in collaboration with UC San Diego, aimed at enhancing patient access and reducing costs in brain health care [1][5] - The NeuroCare platform will facilitate remote treatment for conditions such as Alzheimer's, mood disorders, and military-related conditions, utilizing the Gen-3 HALO™ headset for neurostimulation [2][4] Group 1: Product and Technology - The NeuroCare platform integrates with Nexalin's Gen-3 HALO™ headset, providing a comprehensive ecosystem for remote monitoring and treatment of brain health issues [4] - The Gen-3 HALO™ headset is designed to deliver improved Deep Intracranial Frequency Stimulation (DIFS™) in a home setting, enhancing patient experience and treatment outcomes [4][6] Group 2: Business Model and Market Strategy - Nexalin's business model is subscription-based, promoting sustainable revenue and long-term patient engagement through remote monitoring and care continuity [2][3] - The company aims to scale its operations beyond device sales, focusing on data-driven revenue growth and long-term patient retention in global markets [4][5] Group 3: Clinical Research and Collaboration - The launch of the NeuroCare platform coincides with ongoing clinical trials at UC San Diego, where patient enrollment has begun for evaluating Nexalin's non-invasive treatment methods [1][4] - This collaboration is expected to enhance the clinical infrastructure and support the deployment of Nexalin's digital health ecosystem [1][4]

Core Viewpoint - TrueBlue, Inc. is implementing a disciplined and decisive plan that is leading to improved financial results and is on track to achieve sustainable, profitable growth [1] Group 1: Strategic Plan - The company has strengthened performance in attractive end markets as part of its strategic plan [1]

Core Viewpoint - EHS Investments expresses significant concern over TrueBlue's ongoing operational and financial deterioration, emphasizing the need for meaningful change at the Board level to enhance shareholder value [2][11]. Group 1: Operational and Financial Performance - TrueBlue's operational performance continues to decline, with the share price nearing all-time lows, necessitating a change in the Board [2][10]. - The Q3 earnings report indicates a return to organic revenue growth after twelve consecutive quarters of decline, but the growth is misleading due to cost pass-through accounting from renewable energy projects [6][7]. - TrueBlue's core PeopleReady branch performance is declining, and PeopleSolutions has experienced an -11% organic year-over-year revenue decline [7]. - The company has burned -$17 million in free cash flow for the quarter and -$40 million year-to-date, limiting its ability to repurchase shares [8]. Group 2: Board and Governance Issues - EHS Investments plans to nominate highly qualified director candidates to the Board at the 2026 Annual Meeting, aiming to improve governance and oversight [3][12]. - The Board has shown a lack of substantive engagement and has previously declined acquisition offers, resulting in a significant decline in stock price from approximately $12.30 per share to around $5 per share [10][11]. - Allegations in a recent lawsuit suggest a serious lapse in management and Board oversight, particularly regarding the misallocation of capital in the Jobstack initiative [9]. Group 3: Strategic Focus Areas - EHS nominees will focus on three core pillars: staffing excellence, digital transformation, and disciplined capital allocation, all aimed at maximizing shareholder value [3][14]. - A strategic reassessment of the business is planned, including evaluating potential strategic alternatives and opportunities for simplification [14].

Core Viewpoint - The focus is on producing objective, data-driven research primarily about small- to mid-cap companies, which are often overlooked by many investors, while also occasionally analyzing large-cap companies to provide a broader market perspective [1] Group 1 - The research emphasizes the importance of small- to mid-cap companies in investment analysis due to their potential for growth and the lack of attention they receive from larger investors [1] - The analyst aims to provide insights that can help identify investment opportunities and risks within these segments of the market [1]

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Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $431 million, up 13% year-over-year, exceeding expectations, primarily driven by skilled businesses [11][12] - Gross margin decreased to 22.7% from 26.2% in the prior year, attributed to changes in revenue mix and less favorable workers' compensation reserve adjustments [11][12] - The company reported a net loss of $2 million for the quarter, with adjusted net income of $1 million and adjusted EBITDA of $11 million [13][16] Business Line Data and Key Metrics Changes - PeopleReady segment revenue grew 17%, with energy sector revenue more than doubling due to heightened demand [13][14] - PeopleManagement revenue increased by 2%, driven by the commercial driver business, which achieved its fifth consecutive quarter of double-digit growth [15] - PeopleSolutions revenue rose by 28%, with the recently acquired Healthcare Staffing Professionals contributing significantly to growth [16] Market Data and Key Metrics Changes - The on-demand business showed improved trends, particularly in the eastern U.S., which returned to year-over-year growth [15][27] - The energy sector, hospitality, and manufacturing experienced stronger performance, while retail showed some softness [27] - The East region of PeopleReady achieved year-over-year growth in September, marking a significant recovery [27] Company Strategy and Development Direction - The company is focused on enhancing digital transformation and optimizing sales functions to capture demand and accelerate growth [4][19] - A territory-based go-to-market structure has been implemented to improve sales capacity by 50% and drive local sales strategies [6][19] - The company aims to expand in high-growth markets and strengthen its position in the healthcare sector following the acquisition of Healthcare Staffing Professionals [8][19] Management's Comments on Operating Environment and Future Outlook - Management noted early signs of momentum and a cautious customer sentiment due to ongoing uncertainties in the market [36][37] - The company expects revenue growth of 4%-10% year-over-year in Q4, with the HSP business contributing positively [17][18] - Management highlighted the importance of maintaining pricing discipline amid competitive pressures and cost-conscious clients [47] Other Important Information - The company finished the quarter with $20 million in cash, $68 million in debt, and total liquidity of $95 million [16] - A sublease agreement for the Chicago support center is expected to unlock over $30 million in cash flow over the remaining lease term [18] Q&A Session Summary Question: Strength in on-demand business - Management indicated strong performance in sales-enabled territories and noted a 50% increase in sales capacity, complemented by a new head of sales [23][24] Question: Differences in client verticals and geographies - Local business outperformed national accounts, with significant improvements in energy, hospitality, and manufacturing sectors [25][26] Question: Client sentiment and market uncertainty - Clients are showing cautious sentiment, with some early signs of growth, but overall uncertainty remains [36][37] Question: Impact of immigration reform - The company is experiencing both tailwinds and challenges due to immigration reform, with opportunities for compliant staffing solutions [38] Question: Incremental margin expansion before reinvestment - Management expects to achieve over 20% incremental margins, with a focus on growth opportunities while managing costs [44][46] Question: Pricing environment and competition - The company is facing typical pricing pressures but is maintaining pricing discipline and seeking efficiencies [47]

Financial Performance - Total revenue for Q3 2025 was $431 million, a 13% increase compared to $382 million in Q3 2024[5, 8] - Organic revenue grew by 9%[7, 8] - Net loss improved from $7.6 million in Q3 2024 to $1.9 million in Q3 2025[5, 8] - Adjusted EBITDA increased significantly to $10.6 million, a 127% increase from $4.7 million in Q3 2024[7, 8] - Adjusted EBITDA margin improved by 130 basis points to 2.5% compared to 1.2% in the prior year[8] Segment Results - PeopleReady revenue increased by 17% with segment profit up by 166%[12] - PeopleManagement revenue increased by 2% with segment profit up by 39%[12] - PeopleSolutions revenue increased by 28%, but decreased 11% on an organic basis, with segment profit up by 65%[12] Liquidity and Capital Resources - The company has a solid liquidity position with $20 million in cash, $68 million in debt, and $75 million of borrowing availability, resulting in total liquidity of $95 million[7] Outlook - The company expects Q4 2025 revenue to be between $399 million and $424 million, representing a 4% to 10% increase year-over-year, including a 4 percentage point contribution from the acquisition of Healthcare Staffing Professionals (HSP)[18] - SG&A is expected to be between $91 million and $95 million, a 15% to 11% decrease compared to the prior year[18]

Revenue Growth - Total company revenue grew 12.8% to $431.3 million for the thirteen weeks ended September 28, 2025, driven by strong demand in skilled businesses and the acquisition of HSP contributing 3.7% to growth[116][122] - PeopleReady revenue grew 17.1% to $251.4 million for the thirteen weeks ended September 28, 2025, primarily due to growth in the energy industry[123] - PeopleManagement revenue increased 1.5% to $132.9 million for the thirteen weeks ended September 28, 2025, supported by strong demand in the commercial driving business[125] - PeopleSolutions revenue surged 27.9% to $47.0 million for the thirteen weeks ended September 28, 2025, with the acquisition of HSP contributing 38.6% to this growth[126] - Total company revenue grew 1.4% to $1.2 billion for the thirty-nine weeks ended September 28, 2025[122] Profitability - Gross profit as a percentage of revenue declined to 22.7% for the thirteen weeks ended September 28, 2025, down from 26.2% in the prior year, primarily due to a shift towards lower margin staffing businesses[117] - Gross profit for the thirteen weeks ended September 28, 2025, was $97,892,000, representing 22.7% of revenue, a decline of 350 basis points compared to the prior year[127] - For the thirty-nine weeks ended September 28, 2025, gross profit was $277,798,000, or 23.2% of revenue, down 250 basis points from the same period last year[128] - The PeopleReady segment reported revenue from services of $251,436,000 for the thirteen weeks ended September 28, 2025, with a segment profit of $8,099,000, improving by $5.1 million year-over-year[136] - The PeopleManagement segment achieved revenue from services of $132,863,000 for the thirteen weeks ended September 28, 2025, with a segment profit of $4,552,000, an increase of $1.3 million compared to the prior year[137] - The PeopleSolutions segment reported a profit decline of $2.2 million for the thirty-nine weeks ended September 28, 2025, attributed to revenue loss from a large hospitality client[140] Expenses - Selling, general and administrative (SG&A) expenses improved 8.2% to $91.7 million for the thirteen weeks ended September 28, 2025, due to operational cost management actions[118] - Selling, general and administrative (SG&A) expenses improved by 8.2% to $91,728,000 for the thirteen weeks ended September 28, 2025, and by 9.1% to $276,147,000 for the thirty-nine weeks ended September 28, 2025[129] - SG&A expense for fiscal Q4 2025 is projected to be between $91 million and $95 million, reflecting a decline due to cost management efforts[144] Net Loss and Cash Flow - Net loss was $1.9 million for the thirteen weeks ended September 28, 2025, an improvement from a net loss of $7.6 million in the prior year[120][121] - Net cash used in operating activities for the thirty-nine weeks ended September 28, 2025, was $(53,674) thousand, compared to $(23,189) thousand for the same period last year[151] - Net cash provided by financing activities during the thirty-nine weeks ended September 28, 2025, was $59,589 thousand, primarily due to draws on the Revolving Credit Facility[157] Liquidity and Capital Expenditures - Total liquidity as of September 28, 2025, was $95.0 million, consisting of cash and cash equivalents of $19.9 million and $75.2 million available under the revolving credit facility[120] - As of September 28, 2025, the company had $19.9 million in cash and cash equivalents and $68.2 million in outstanding debt[145] - The company expects capital expenditures and spending for software as a service assets to be between $17 million and $19 million for fiscal 2025[143] Future Outlook - Future growth is anticipated as client hiring volumes return, particularly in higher-skilled roles and attractive end markets such as healthcare and technology[126] - Revenue growth for fiscal Q4 2025 is expected to be between 4% and 10%, including approximately 4% inorganic growth from the acquisition of HSP[144] - Anticipated gross profit as a percentage of revenue is expected to decline between 410 and 370 basis points compared to the same period last year[144] Impairment and Valuation - A non-cash impairment charge of $0.2 million was recorded for the thirty-nine weeks ended September 28, 2025, related to a trademark in the PeopleManagement segment[131] - The goodwill balance for HSP as of September 28, 2025, was $17.3 million, with an estimated fair value exceeding its carrying value by approximately 5%[168] - The weighted average cost of capital for the most recent goodwill impairment test ranged from 14.5% to 16.5%[167] - All reporting units' fair values were substantially in excess of their carrying values, except for HSP, which had a fair value exceeding its carrying value by approximately 5%[168] Digital Transformation and Market Strategy - The company continues to focus on enhancing digital transformation and expanding in high-growth, under-penetrated end markets to capture market share[112] - The company continues to invest in technology platforms to enhance service delivery efficiency and transition to cloud-based solutions[147]