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TrueBlue Reports 2011 Third Quarter Results

Stocks in this article: TBI

TrueBlue, Inc. (NYSE:TBI) today reported revenue for the third quarter of 2011 of $371 million, an increase of 19 percent compared to revenue of $313 million for the third quarter of 2010. Net income for the quarter was $13.9 million, or $0.33 per diluted share, compared to net income of $10.2 million, or $0.23 per diluted share, for the third quarter of 2010.

“We are pleased with our results, particularly the strong revenue growth we delivered this quarter,” said TrueBlue CEO Steve Cooper. “Operating income grew 50 percent compared to the same quarter last year, excluding the impact of non-recurring HIRE Act credits in the third quarter of 2010. This demonstrates the powerful operating leverage that exists in our business.

“TrueBlue’s vertical market strategy, including our dedicated sales leaders equipped with expertise in the industries we serve, drove our better-than-expected revenue. We will continue to build on our strong vertical market capabilities to increase value to all of our customers from the local to national level.”

During the quarter and through Oct. 21, TrueBlue purchased approximately 3.4 million shares of its outstanding common stock for $42 million. This brings the total shares purchased for the year to 4.3 million shares for a total of $55 million. Forty-two million dollars remains available to purchase shares under the current program approved by the Board of Directors on July 25, 2011.

For the 13-week fourth quarter of 2011, TrueBlue estimates revenue in the range of $335 million to $345 million, which is growth of about 9 percent compared to the 14-week fourth quarter of 2010. On a comparable week basis, this revenue growth would be about 18 percent. The company also estimates net income per diluted share of $0.12 to $0.17 for the fourth quarter of 2011.

Management will discuss third quarter 2011 results on a conference call at 2 p.m. (PT), today, Wednesday, Oct. 26, 2011. The conference call and a copy of the slides for the call can be accessed on TrueBlue’s web site:

About TrueBlue

TrueBlue, Inc. is a leading provider of blue-collar staffing. In 2010, TrueBlue connected approximately 300,000 people to work through the following brands: Labor Ready, Spartan Staffing, CLP Resources, PlaneTechs, and Centerline, and served approximately 175,000 businesses in the services, retail, wholesale, manufacturing, transportation, aviation, and construction industries. TrueBlue, Inc. is headquartered in Tacoma, Wash. For more information, visit TrueBlue’s website at

Forward-looking Statements

This document contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “will,” “should,” “expects,” “intends,” “projects,” “plans,” “believes,” “estimates,” “targets,” “anticipates,” and similar expressions are used to identify these forward-looking statements. Examples of forward-looking statements include statements relating to our future financial condition and operating results, as well as any other statement that does not directly relate to any historical or current fact. Forward-looking statements are based on our current expectations and assumptions, which may not prove to be accurate. These statements are not guarantees and are subject to risks, uncertainties, and changes in circumstances that are difficult to predict. Many factors could cause actual results to differ materially and adversely from these forward-looking statements. Examples of such factors can be found in our reports filed with the SEC, including the information under the heading ‘Risk Factors’ in our Annual Report on Form 10-K for the year ended Dec. 31, 2010. Any forward-looking statement speaks only as of the date on which it is made, and we assume no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law.

(Unaudited, in thousands, except per share data)
13 Weeks Ended   13 Weeks Ended 39 Weeks Ended 39 Weeks Ended
September 30, September 24, September 30, September 24,
2011 2010 2011 2010
Revenue from services $ 371,379 $ 312,769 $ 965,857 $ 837,424
Cost of services   271,528   228,181   710,644   615,882
Gross profit 99,851 84,588 255,213 221,542
Selling, general and administrative expenses 73,235 64,442 206,071 186,926
Depreciation and amortization   4,205   3,874   11,989   11,888
Income from operations 22,411 16,272 37,153 22,728
Interest and other income, net   323   144   798   663
Income before tax expense 22,734 16,416 37,951 23,391
Income tax expense   8,821   6,197   14,724   7,511
Net income $ 13,913 $ 10,219 $ 23,227 $ 15,880
Net income per common share:
Basic $ 0.33 $ 0.24 $ 0.54 $ 0.37
Diluted $ 0.33 $ 0.23 $ 0.54 $ 0.37
Weighted average shares outstanding:
Basic 41,612 43,269 42,813 43,196
Diluted 41,958 43,509 43,176 43,456
(Unaudited, in thousands)
September 30, December 31,
2011 2010
Current assets:
Cash and cash equivalents $ 99,050 $ 163,153
Accounts receivable, net 174,384 108,692
Other current assets   12,932   21,655
Total current assets 286,366 293,500
Property and equipment, net 54,733 53,958
Restricted cash and investments 136,538 120,067
Other assets, net   91,004   78,941
Total assets $ 568,641 $ 546,466
Liabilities and shareholders' equity
Current liabilities $ 125,837 $ 85,923
Long-term liabilities   152,215   147,836
Total liabilities 278,052 233,759
Shareholders' equity   290,589   312,707
Total liabilities and shareholders' equity $ 568,641 $ 546,466
(Unaudited, in thousands)
39 Weeks Ended 39 Weeks Ended
September 30, September 24,
2011 2010
Cash flows from operating activities:
Net income $ 23,227 $ 15,880
Adjustments to reconcile net income to net cash:
Depreciation and amortization 11,989 11,888
Provision for doubtful accounts 4,424 5,828
Stock-based compensation 5,583 5,412
Deferred income taxes 899 1,986
Other operating activities (471 ) (141 )
Changes in operating assets and liabilities:
Accounts receivable (70,116 ) (34,357 )
Income taxes 6,950 1,345
Other assets 1,720 253
Accounts payable and other accrued expenses 19,634 1,489
Accrued wages and benefits 12,033 4,560
Workers' compensation claims reserve 735 83
Other liabilities   (144 )   123  
Net cash provided by operating activities   16,463     14,349  
Cash flows from investing activities:
Capital expenditures (6,251 ) (5,256 )
Change in restricted cash and cash equivalents 65,104 6,358

Purchases of restricted investments

(87,768 ) -
Maturities of restricted investments 6,193 -
Other   (6,800 )   (297 )
Net cash (used in) provided by investing activities   (29,522 )   805  
Cash flows from financing activities:
Purchases and retirement of common stock (50,143 ) -
Net proceeds from sale of stock through options and employee benefit plans 874 755
Common stock repurchases for taxes upon vesting of restricted stock (1,692 ) (1,467 )
Payments on debt (302 ) (282 )
Other   674     48  
Net cash used in financing activities   (50,589 )   (946 )
Effect of exchange rates on cash   (455 )   396  
Net change in cash and cash equivalents (64,103 ) 14,604
CASH AND CASH EQUIVALENTS, beginning of period   163,153     124,377  
CASH AND CASH EQUIVALENTS, end of period $ 99,050   $ 138,981  

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