Trueblue (TBI) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue declined 17% year-over-year to $396 million amid economic uncertainty and reduced client hiring, with softness across most verticals except renewable energy and commercial driving services.

• Net loss was $105 million, including a $45 million non-cash impairment and a $55 million deferred tax asset valuation allowance.

• Adjusted EBITDA was $1 million, reflecting significant cost management and operational streamlining.

• SG&A expense was reduced by 20% to $97 million, reflecting cost actions and organizational simplification.

• Strong liquidity maintained with zero debt, $26 million in cash, and $132 million in borrowing availability.

Financial highlights

• Revenue: $396 million for Q2 2024, down 17% year-over-year.

• Net loss: $105 million, including significant non-cash impairment and tax charges.

• Adjusted net loss was $11 million; adjusted EBITDA was $1 million.

• Gross margin was 26.4%, down 100 basis points year-over-year due to unfavorable revenue mix and pricing pressures.

• SG&A reduced by 20% year-over-year, with $70 million in cost reductions, much of which is expected to be permanent.

Outlook and guidance

• Q3 2024 revenue expected to decline 14%-20% year-over-year, with a 1-point drag from the Canada business sale.

• SG&A for Q3 projected at $99-$103 million, about $20 million lower than prior year, including $2 million in workforce reduction costs.

• Gross margin for Q3 2024 anticipated to decline 20–60 basis points year-over-year due to business mix.

• FY 2024 CapEx and depreciation each expected at $23–$27 million.

• Effective tax rate for FY 2024 expected at -35% to -40% due to valuation allowance.