UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

	
 	
FORM 8-K

	
 	
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): April 30, 2018

	

TRUEBLUE, INC.
(Exact Name of Registrant as Specified in Its Charter)

	
 	
Washington
(State or Other Jurisdiction
of Incorporation)

			
001-14543	 	91-1287341	
(Commission
File Number)	 	(IRS Employer
Identification No.)	

	
			
1015 A Street, Tacoma, Washington	 	98402	
(Address of Principal Executive Offices)	 	(Zip Code)	
(253) 383-9101
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

	
 	
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2. below):

		
¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	

		
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	

		
¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))	

		
¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))	

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

					

	
		
Item 2.02.	Results of Operations and Financial Condition.	

On April 30, 2018 , TrueBlue, Inc. (the “company”) issued a press release (the “Press Release”) reporting its financial results for the first quarter ended April 1, 2018 , and revenue and earnings guidance for the second quarter of 2018 , a copy of which is attached hereto as Exhibit 99.1 and the contents of which are incorporated herein by this reference. Also attached to this report as Exhibit 99.2 is a slide presentation relating to the financial results for the first quarter ended April 1, 2018 (the “Earnings Results Presentation”), which will be discussed by management of the company on a live conference call at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time) on Monday, April 30, 2018 . The Earnings Results Presentation is also available on the company's website at www.trueblue.com.

In accordance with General Instruction B.2. of Form 8-K, the information contained above in this report (including the Press Release and the Earnings Results Presentation) shall not be deemed “Filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall the Press Release or the Earnings Results Presentation be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing. This report will not be deemed a determination or an admission as to the materiality of any information in the report that is required to be disclosed solely by Regulation FD.

	
		
Item 7.01.	Regulation FD Disclosure.	
We are also attaching our Investor Presentation (the "Investor Presentation") to this report as Exhibit 99.3, which we will reference in our Q1 2018 earnings results discussion and which may be used in future investor conferences. The Investor Presentation is also available on the company's website at www.trueblue.com.
In accordance with General Instruction B.2. of Form 8-K, the information contained above in this report (including the Investor Presentation) shall not be deemed “Filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall the Investor Presentation be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing. This report will not be deemed a determination or an admission as to the materiality of any information in the report that is required to be disclosed solely by Regulation FD.

		
Item 9.01.	Financial Statements and Exhibits.	
		
(d)	Exhibits	
		
99.1	Press Release dated April 30, 2018	
		
99.2	Earnings Results Presentation for April 30, 2018 conference call	
		
99.3	Investor Presentation	

SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	

 	 	TRUEBLUE, INC.	
 	 	(Registrant)	
 	 	 	
Date:	4/30/2018	By:	 	/s/ Derrek L. Gafford	
 	 	 	 	Derrek L. Gafford	
 	 	 	 	Chief Financial Officer and Executive Vice President	

EXHIBIT INDEX

			
Exhibit
Number	Exhibit Description	Filed Herewith	
99.1	Press Release dated April 30, 2018	X	
99.2	Earnings Results Presentation for April 30, 2018 conference call	X	
99.3	Investor Presentation	X	

TRUEBLUE REPORTS FISCAL FIRST QUARTER 2018 RESULTS

TACOMA, WA-April 30, 2018 -- TrueBlue, Inc. (NYSE:TBI) announced today its fiscal first quarter 2018 results.

Revenue was $554 million , a decrease of 2 percent , compared to revenue of $568 million in the fiscal first quarter of 2017 . Net income per diluted share was $0.22 , an increase of 100 percent , compared to $0.11 in the fiscal first quarter of 2017 . Adjusted net income per diluted share 1 was $0.31 , an increase of 48 percent , compared to $0.21 in the fiscal first quarter of 2017 .

“We are off to a strong start this year with earnings per share growth of 100 percent,” TrueBlue CEO Steve Cooper said. “While revenue was down modestly, growth in our PeopleScout business accelerated to over 20 percent, and we are taking the right actions to return the PeopleReady business to growth. Programs to reduce the cost of services are working, resulting in our ninth consecutive quarter of gross margin expansion and a three percent increase in gross profit for the quarter.”

“We are making good progress with our digital strategy. Prospective PeopleScout clients are excited about our new talent acquisition technology, Affinix TM , and adoption of our PeopleReady mobile staffing technology, JobStack TM , is increasing. We have the right strategy to differentiate our services and position the business for profitable long-term growth.”

TrueBlue also announced today the divestiture of PlaneTechs, a provider of skilled mechanics and technicians to the aviation sector, which was completed in March. PlaneTechs made up less than 2 percent of total company revenue and the divestiture is not expected to have a meaningful impact on operating income. The action will further enable the company to focus on larger market, higher growth, and higher profit margin opportunities.

2018 Outlook

The company estimates revenue for the fiscal second quarter of 2018 to range from $585 million to $600 million . It also expects net income per diluted share to range from $0.32 to $0.38 . Adjusted net income per diluted share is expected to range from $0.47 to $0.53 .
Management will discuss fiscal first quarter 2018 results on a webcast at 2 p.m. PT (5 p.m. ET), today, Monday, Apr. 30. The webcast can be accessed on TrueBlue’s website:  www.trueblue.com .

About TrueBlue:

TrueBlue (NYSE: TBI) is a leading provider of specialized workforce solutions that help clients achieve business growth and improve productivity, while connecting approximately 740,000 people with work in 2017. TrueBlue's PeopleReady segment offers industrial staffing services, PeopleManagement offers contingent and productivity-based on-site industrial staffing services, and PeopleScout offers Recruitment Process Outsourcing (RPO) and Managed Service Provider (MSP) solutions to a wide variety of industries. Learn more at www.trueblue.com .

1 See the financial statements accompanying the release and the company’s website for more information on non-GAAP terms.

Forward-looking Statements

This document contains forward-looking statements relating to our plans and expectations, all of which are subject to risks and uncertainties. Such statements are based on management’s expectations and assumptions as of the date of this release and involve many risks and uncertainties that could cause actual results to differ materially from those expressed or implied in our forward-looking statements including: (1) national and global economic conditions, (2) our ability to attract and retain customers, (3) our ability to maintain profit margins, (4) new laws and regulations that could have a material effect on our operations or financial results, (5) our ability to successfully complete and integrate acquisitions (6) our ability to attract sufficient qualified candidates and employees to meet the needs of our customers, (7) our ability to successfully execute on new business strategies and initiatives such as the consolidation of our service lines and leveraging of mobile technology, and (8) uncertainty surrounding the interpretation and application of the recent 2017 Tax Cuts and Jobs Act and any reduction or change in tax credits we utilize, including the Work Opportunity Tax Credit. Other information regarding factors that could affect our results is included in our Securities Exchange Commission (SEC) filings, including the company's most recent reports on Forms 10-K and 10-Q, copies of which may be obtained by visiting our website at www.trueblue.com under the Investor Relations section or the SEC's website at www.sec.gov. 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. Any other reference to future financial estimates are included for informational purposes only and subject to risk factors discussed in our most recent filings with the SEC.

In addition, we use several non-GAAP financial measures when presenting our financial results in this document. Please refer to the reconciliations between our GAAP and non-GAAP financial measures in the appendix to this document and on our website at www.trueblue.com under the Investor Relations section for a complete perspective on both current and historical periods. The presentation of these non-GAAP financial

measures is used to enhance the understanding of certain aspects of our financial performance. It is not meant to be considered in isolation, superior to, or as a substitute for the directly comparable financial measures prepared in accordance with U.S. GAAP, and may not be comparable to similarly titled measures of other companies.

Contact:
Derrek Gafford, EVP & CFO
253-680-8214

TRUEBLUE, INC.
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

	
							
 	13 Weeks Ended	
(in thousands, except per share data)	Apr 1, 2018	Apr 2, 2017	
Revenue from services	$	554,388		$	568,244		
Cost of services	411,120		428,815		
Gross profit	143,268		139,429		
Selling, general and administrative expense	125,763		121,844		
Depreciation and amortization	10,090		11,174		
Income from operations	7,415		6,411		
Interest and other income (expense), net	2,204		74		
Income before tax expense	9,619		6,485		
Income tax expense	864		1,811		
Net income	$	8,755		$	4,674		
 	 	 	
Net income per common share:	 	 	
Basic	$	0.22		$	0.11		
Diluted	$	0.22		$	0.11		
 	 	 	
Weighted average shares outstanding:	 	 	
Basic	40,443		41,637		
Diluted	40,694		41,937		

TRUEBLUE, INC.
SUMMARY CONSOLIDATED BALANCE SHEETS
(Unaudited)

	
							
(in thousands)	Apr 1, 2018	Dec 31, 2017	
ASSETS	 	 	
Cash and cash equivalents	$	26,636		$	28,780		
Accounts receivable, net	322,388		374,273		
Other current assets	29,806		25,226		
Total current assets	378,830		428,279		
Property and equipment, net	57,142		60,163		
Restricted cash and investments	242,766		239,231		
Goodwill and intangible assets, net	323,468		331,309		
Other assets, net	51,745		50,049		
Total assets	$	1,053,951		$	1,109,031		
 	 	 	
LIABILITIES AND SHAREHOLDERS’ EQUITY	 	 	
Current liabilities	$	197,753		$	212,419		
Long-term debt, less current portion	69,621		116,489		
Other long-term liabilities	222,641		225,276		
Total liabilities	490,015		554,184		
Shareholders’ equity	563,936		554,847		
Total liabilities and shareholders’ equity	$	1,053,951		$	1,109,031		

TRUEBLUE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
( Unaudited)

							
 	13 Weeks Ended	
(in thousands)	Apr 1, 2018	Apr 2, 2017	
Cash flows from operating activities:	 	 	
Net income	$	8,755		$	4,674		
Adjustments to reconcile net income   to net cash provided by operating activities:	 	 	
Depreciation and amortization	10,090		11,174		
Provision for doubtful accounts	2,209		1,446		
Stock-based compensation	3,409		3,304		
Deferred income taxes	1,370		726		
Other operating activities	(572	)	1,080		
Changes in operating assets and liabilities:	 	 	
Accounts receivable	42,679		49,077		
Income tax receivable	(2,842	)	9,565		
Other assets	(1,964	)	3,627		
Accounts payable and other accrued expenses	(4,878	)	(15,015	)	
Accrued wages and benefits	(9,991	)	(16,071	)	
Workers’ compensation claims reserve	(4,579	)	(1,957	)	
Other liabilities	1,149		2,488		
Net cash provided by operating activities	44,835		54,118		
Cash flows from investing activities:	 	 	
Capital expenditures	(1,911	)	(6,167	)	
Divestiture of business	8,500		—		
Purchases of restricted investments	(3,299	)	(14,975	)	
Maturities of restricted investments	6,417		4,423		
Net cash provided by (used in) investing activities	9,707		(16,719	)	
Cash flows from financing activities:	 	 	
Net proceeds from stock option exercises and employee stock purchase plans	395		491		
Common stock repurchases for taxes upon vesting of restricted stock	(2,086	)	(2,400	)	
Net change in revolving credit facility	(46,301	)	(57,367	)	
Payments on debt	(567	)	(567	)	
Net cash used in financing activities	(48,559	)	(59,843	)	
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(760	)	(339	)	
Net change in cash, cash equivalents, and restricted cash	5,223		(22,783	)	
Cash, cash equivalents and restricted cash, beginning of period	73,831		103,222		
Cash, cash equivalents and restricted cash, end of period	$	79,054		$	80,439		

TRUEBLUE, INC.
NON-GAAP FINANCIAL MEASURES AND NON-GAAP RECONCILIATIONS

In addition to financial measures presented in accordance with U.S. GAAP, we monitor certain non-GAAP key financial measures. The presentation of these non-GAAP financial measures is used to enhance the understanding of certain aspects of our financial performance. It is not meant to be considered in isolation, superior to, or as a substitute for the directly comparable financial measures prepared in accordance with U.S. GAAP, and may not be comparable to similarly titled measures of other companies.

				
Non-GAAP Measure	Definition	 	Purpose of Adjusted Measures	
EBITDA and Adjusted EBITDA	EBITDA excludes from net income:
- interest and other income (expense), net,
- income taxes, and
- depreciation and amortization.

Adjusted EBITDA, further excludes:
- Work Opportunity Tax Credit third-party processing fees, and
- cloud-based software implementation costs.

	 	- Enhances comparability on a consistent basis and provides investors with useful insight into the underlying trends of the business.

- Used by management to assess performance and effectiveness of our business strategies.

- Provides a measure, among others, used in the determination of incentive compensation for management.	
Adjusted net income and Adjusted net income, per diluted share	Net income and net income per diluted share, excluding:
- gain on divestiture,
- amortization of intangibles of acquired businesses, as well as accretion expense related to acquisition earn-out,
- cloud-based software implementation costs,
- tax effect of each adjustment to U.S. GAAP net income, and
- adjusted income taxes to the expected effective tax rate.	 	- Enhances comparability on a consistent basis and provides investors with useful insight into the underlying trends of the business.

- Used by management to assess performance and effectiveness of our business strategies.

		
1.	RECONCILIATION OF U.S. GAAP NET INCOME TO ADJUSTED NET INCOME AND ADJUSTED NET INCOME, PER DILUTED SHARE	
( Unaudited )

	
										
 	Q1 2018	 	Q1 2017	 	Q2 2018 Outlook*	
 	13 Weeks Ended	 	13 Weeks Ended	 	13 Weeks Ended	
(in thousands, except for per share data)	Apr 1, 2018	 	Apr 2, 2017	 	Jul 1, 2018	
Net income	$	8,755		 	$	4,674		 	$ 12,900 — $ 15,400	
Gain on divestiture (1)	(1,393	)	 	—		 	—	
Amortization of intangible assets of acquired businesses (2)	5,221		 	5,864		 	5,100	
Cloud-based software implementation costs (3)	1,715		 	—		 	2,200	
Tax effect of adjustments to net income (4)	(887	)	 	(1,642	)	 	(1,200)	
Adjustment of income taxes to normalized effective rate (5)	(675	)	 	(5	)	 	—	
Adjusted net income	$	12,736		 	$	8,891		 	$ 19,000 — $ 21,500	
 	 	 	 	 	 	
Adjusted net income, per diluted share	$	0.31		 	$	0.21		 	$ 0.47 — $ 0.53	
 	 	 	 	 	 	
Diluted weighted average shares outstanding	40,694		 	41,937		 	40,700	

2.	RECONCILIATION OF U.S. GAAP NET INCOME TO EBITDA AND ADJUSTED EBITDA	
( Unaudited )

										
 	Q1 2018	 	Q1 2017	 	Q2 2018 Outlook*	
 	13 Weeks Ended	 	13 Weeks Ended	 	13 Weeks Ended	
(in thousands)	Apr 1, 2018	 	Apr 2, 2017	 	Jul 1, 2018	
Net income	$	8,755		 	$	4,674		 	$ 12,900 — $ 15,400	
Income tax expense	864		 	1,811		 	2,500 — 2,900	
Interest and other income (expense), net	(2,204	)	 	(74	)	 	(400)	
Depreciation and amortization	10,090		 	11,174		 	10,200	
EBITDA	17,505		 	17,585		 	25,100 — 28,100	
Work Opportunity Tax Credit processing fees (6)	195		 	272		 	200	
Cloud-based software implementation costs (3)	1,715		 	—		 	2,200	
Adjusted EBITDA	$	19,415		 	$	17,857		 	$ 27,500 — $ 30,500	
* Totals may not sum due to rounding	 	 	 	 	 	

(1)	In mid-March 2018, we entered into an asset purchase agreement with a private, strategic buyer for the sale of our PlaneTechs service line, which resulted in a pre-tax gain of $1.4 million.	

(2)	Amortization of intangible assets of acquired businesses as well as accretion expense related to the SIMOS acquisition earn-out.	

(3)	Implementation costs for cloud-based systems.	

(4)	Total tax effect of each of the adjustments to U.S. GAAP net income using the expected ongoing rate of 16 percent for 2018, due to the enacted U.S. Tax Cuts and Jobs Act, and 28 percent for 2017.	

(5)	Adjustment of the effective income tax rate to the expected ongoing rate of 16 percent for 2018, due to the enacted U.S. Tax Cuts and Jobs Act, and 28 percent for 2017.	

(6)	These third-party processing fees are associated with generating the Work Opportunity Tax Credits, which are designed to encourage employers to hire workers from certain targeted groups with higher than average unemployment rates and reduce our income taxes.	

TRUEBLUE, INC.
SEGMENT INFORMATION

3. SEGMENT DATA
(Unaudited)

							
 	13 Weeks Ended	
(in thousands)	Apr 1, 2018	Apr 2, 2017	
Revenue from services:	 	 	
PeopleReady	$	316,835		$	332,624		
PeopleManagement	183,892		191,686		
PeopleScout	53,661		43,934		
Total company	554,388		568,244		
 	 	 	
Segment profit  (1):	 	 	
PeopleReady	$	9,525		$	9,994		
PeopleManagement	5,649		5,533		
PeopleScout	11,905		8,665		
Total segment profit	27,079		24,192		
Corporate unallocated expense	(7,664	)	(6,335	)	
Total company Adjusted EBITDA	19,415		17,857		
Work Opportunity Tax Credit processing fees (2)	(195	)	(272	)	
Cloud-based software implementation costs (3)	(1,715	)	—		
EBITDA	17,505		17,585		
Depreciation and amortization	(10,090	)	(11,174	)	
Interest and other income (expense), net	2,204		74		
Income before tax expense	9,619		6,485		
Income tax expense	(864	)	(1,811	)	
Net income	$	8,755		$	4,674		
		
(1)	We evaluate performance based on segment revenue and segment profit. Segment profit includes revenue, related cost of services, and ongoing operating expenses directly attributable to the reportable segment. Segment profit excludes goodwill and intangible impairment charges, depreciation and amortization expense, unallocated corporate general and administrative expense, interest, other income and expense, income taxes, and costs not considered to be ongoing costs of the segment. Segment profit is comparable to segment adjusted EBITDA amounts reported in prior periods.	

(2)	These third-party processing fees are associated with generating the Work Opportunity Tax Credits, which are designed to encourage employers to hire workers from certain targeted groups with higher than average unemployment rates and reduce our income taxes.	

(3)	Implementation costs for cloud-based systems.	

www.TrueBlue.com April 30, 2018 

 

Forward-Looking Statements 

 

Q1 2018 summary Strong earnings per share growth  EPS +100%, adjusted EPS1 +48% o Favorable income tax, gross margin, and depreciation results o Gain on sale of PlaneTechs (excluded from adjusted EPS) Modest revenue decline but gross profit up 3%  Total revenue -2%  PeopleReady -5%, solar industry challenges and soft trends in Southeast  PeopleManagement -4%, -2% excluding PlaneTechs2 and in-line with expectation  PeopleScout +22%, accelerating revenue growth  Programs to lower cost of services are working – gross margin +130 bps Divestiture of PlaneTechs business  Small, non-strategic asset, less than 2% of total revenue  Concentrates our focus on larger market and higher growth and margin opportunities Continuing to execute on our strategy  PeopleReady – Continued progress on mobile technology  PeopleManagement – Attractive on-premise solution for larger, strategic clients  PeopleScout – #1 in RPO market, new proprietary technology, attractive margin 1 See the appendix to this presentation and “Financial Information” in the investors section of our website at www.trueblue.com for a definition and full reconciliation of non-GAAP financial measures to GAAP financial results. 2 In mid-March 2018, we entered into an asset purchase agreement with a private, strategic buyer for the sale of our PlaneTechs service line. Growth presented excluding both current and prior year PlaneTechs results. 

 

Financial summary Amounts in millions, except per share data Q1 2018 Y/Y Change Revenue $554 -2% Net Income $8.8 +87% Net Income Per Diluted Share $0.22 +100% Adjusted Net Income1 $12.7 +43% Adj. Net Income Per Diluted Share1 $0.31 +48% Adjusted EBITDA1 $19.4 +9% Adjusted EBITDA Margin 3.5% 40 bps 1 See the appendix to this presentation and “Financial Information” in the investors section of our website at www.trueblue.com for a definition and full reconciliation of non-GAAP financial measures to GAAP financial results.  PlaneTechs divested 3 weeks before quarter end = $3 million of lost revenue  Net income benefited from a $1.4 million pre-tax gain on the sale of PlaneTechs  Lower income tax rate from U.S. Tax Cuts and Jobs Act  Lower depreciation from certain technology investments becoming fully depreciated  Success with programs to reduce the cost of services boosted adj. EBITDA margin 

 

24.5% 25.8% 0.6% 0.7% Q1 2017 PeopleScout PeopleReady & PeopleManagement Q1 2018 Gross margin and SG&A bridges SG&A Amounts in millions $122 $126 $2 $2 Q1 2017 EBITDA add-backs* Core business Q1 2018 Gross Margin * Implementation costs for cloud-based systems. 

 

Results by segment Amounts in millions PeopleReady PeopleManagement PeopleScout Revenue $317 $184 $54 % Growth -5% -4% (-2% ex-PlaneTechs) +22% Segment Profit1 $9.5 $5.6 $11.9 % Growth -5% +2% +37% % Margin Y/Y Change 3.0% Flat 3.1% +20 bps 22.2% +250 bps Notes: 1 We evaluate performance based on segment revenue and segment profit. Segment profit includes revenue, related cost of services, and ongoing operating expenses directly attributable to the reportable segment. Segment profit excludes goodwill and intangible impairment charges, depreciation and amortization expense, unallocated corporate general and administrative expense, interest, other income and expense, income taxes, and costs not considered to be ongoing costs of the segment. Segment profit is comparable to segment adjusted EBITDA amounts reported in prior periods.  Tariffs on solar panels and soft trends in Southeast impacting revenue  Solid segment profit margin performance in spite of revenue headwinds  Lower workers’ compensation aiding segment profit margin  Revenue decline of 2% excluding the divested PlaneTechs business  Healthy new business pipeline  SG&A management produced higher segment profit margin  Third consecutive quarter of double-digit revenue growth  New talent acquisition technology garnering strong interest from prospective customers  Recruiting process efficiencies continue to drive higher segment profit margin 

 

Segment strategy highlights  Worker component of JobStackTM mobile app fully deployed  4,300 unique clients on JobStack as of Q1-18  Expect 10,000 clients to be actively using JobStack by the end of 2018  Attractive on-premise solution o Perfect fit for larger clients with longer- duration / strategic need for contingent workers o Strength in the e- commerce vertical o Internal focus on new client wins and margin expansion  Global RPO market experiencing strong growth  Industry leading proprietary technology – recently launched AffinixTM, a next- generation HR tool  Attractive margin business with compelling value proposition Cross-Selling: Leverage significant opportunities with key strategic accounts 

 

Successful divestiture of PlaneTechs business Formerly part of PeopleManagment, PlaneTechs specializes in providing temporary skilled mechanics and technicians to aircraft maintenance, repair, overhaul and manufacturing companies in the commercial, government services and business aviation sectors. Transaction Highlights  Sold to private, strategic buyer in mid-March  $11 million purchase price  7.7x 2017 segment profit Strategic Rationale Financial Impact  Annual revenue of approximately $40 million with a 3% segment profit margin  Divestiture creates revenue headwind of ~2% in 2018 Yo Y R ev en u e G ro w th H ea d w in d PlaneTechs Historical Results Amounts in millions Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Revenue 12$ 11$ 10$ 10$ 8$ Segment Profit 0.4$ 0.4$ 0.3$ 0.4$ (0.2)$ Concentrates our focus on larger market and higher growth and margin opportunities Small revenue base and growth potential -1% -2% -2% -2% -1% -2% -6% -5% -5% -4% Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Total TBI PeopleManagement 

 

31% 21% 18% 11% 2015 2016 2017 Q1-18 $216 $103 $90 $45 $30 $35 $29 $27 $246 $138 $119 $72 2015 2016 2017 Q1-18 Net Debt Cash $77 $136 $117 $132 $30 $35 $29 $27 $107 $171 $146 $159 2015 2016 2017 Q1-18 Borrowing Availability Cash Lower debt and ample liquidity Total Debt Liquidity Debt to Total Capital1 Amounts in millions Amounts in millions Note: Balances as of fiscal period end. 1 Calculated as total debt divided by the sum of total debt plus shareholders’ equity. 

 

 

Q2 2018 Outlook Revenue Outlook % Growth % Growth Excluding PlaneTechs Total $585 to $600 -4% to -2% -2% to Flat PeopleReady $349 to $356 -6% to -4% -6% to -4% PeopleManagement $181 to $185 -6% to -4% Flat to 2% PeopleScout $55 to $58 17% to 25% 17% to 25% Profitability & Capital Expenditures Outlook Notes Net income per diluted share $0.32 to $0.38 • Assumes an effective income tax rate of 16% • $2.2 million of add-backs related to implementation costs for cloud-based systems • Assumes diluted weighted average shares outstanding of 40.7 million Adjusted net income per diluted share $0.47 to $0.53 Capital Expenditures $3 Amounts in millions, except per share data Note: Figures may not sum to consolidated totals due to rounding. 

 

 

NON-GAAP FINANCIAL MEASURES AND NON-GAAP RECONCILIATIONS 13 Non-GAAP Measure Definition Purpose of Adjusted Measures EBITDA and Adjusted EBITDA EBITDA excludes from net income: - interest and other income (expense), net, - income taxes, and - depreciation and amortization. Adjusted EBITDA, further excludes: - Work Opportunity Tax Credit third-party processing fees, and - cloud-based software implementation costs. - Enhances comparability on a consistent basis and provides investors with useful insight into the underlying trends of the business. - Used by management to assess performance and effectiveness of our business strategies. - Provides a measure, among others, used in the determination of incentive compensation for management. Adjusted net income and Adjusted net income, per diluted share Net income and net income per diluted share, excluding: - gain on divestiture, - amortization of intangibles of acquired businesses, as well as accretion expense related to acquisition earn-out, - cloud-based software implementation costs, - tax effect of each adjustment to U.S. GAAP net income, and - adjusted income taxes to the expected effective tax rate. - Enhances comparability on a consistent basis and provides investors with useful insight into the underlying trends of the business. - Used by management to assess performance and effectiveness of our business strategies. In addition to financial measures presented in accordance with U.S. GAAP, we monitor certain non-GAAP key financial measures. The presentation of these non- GAAP financial measures is used to enhance the understanding of certain aspects of our financial performance. It is not meant to be considered in isolation, superior to, or as a substitute for the directly comparable financial measures prepared in accordance with U.S. GAAP, and may not be comparable to similarly titled measures of other companies. 

 

1. RECONCILIATION OF U.S. GAAP NET INCOME TO ADJUSTED NET INCOME AND ADJUSTED NET INCOME, PER DILUTED SHARE (Unaudited) 14 See the last slide of the appendix for footnotes. 2. RECONCILIATION OF U.S. GAAP NET INCOME TO EBITDA AND ADJUSTED EBITDA (Unaudited) Q1 2018 Q1 2017 Q2 2018 Outlook* 13 Weeks Ended 13 Weeks Ended 13 Weeks Ended (in thousands, except for per share data) Apr 1, 2018 Apr 2, 2017 Jul 1, 2018 Net income $ 8,755 $ 4,674 $ 12,900 — $ 15,400 Gain on divestiture (1) (1,393 ) — — Amortization of intangible assets of acquired businesses (2) 5,221 5,864 5,100 Cloud-based software implementation costs (3) 1,715 — 2,200 Tax effect of adjustments to net income (4) (887 ) (1,642 ) (1,200) Adjustment of income taxes to normalized effective rate (5) (675 ) (5 ) — Adjusted net income $ 12,736 $ 8,891 $ 19,000 — $ 21,500 Adjusted net income, per diluted share $ 0.31 $ 0.21 $ 0.47 — $ 0.53 Diluted weighted average shares outstanding 40,694 41,937 40,700 Q1 2018 Q1 2017 Q2 2018 Outlook* 13 Weeks Ended 13 Weeks Ended 13 Weeks Ended (in thousands) Apr 1, 2018 Apr 2, 2017 Jul 1, 2018 Net income $ 8,755 $ 4,674 $ 12,900 — $ 15,400 Income tax expense 864 1,811 2,500 — 2,900 Interest and other income (expense), net (2,204 ) (74 ) (400) Depreciation and amortization 10,090 11,174 10,200 EBITDA 17,505 17,585 25,100 — 28,100 Work Opportunity Tax Credit processing fees (6) 195 272 200 Cloud-based software implementation costs (3) 1,715 — 2,200 Adjusted EBITDA $ 19,415 $ 17,857 $ 27,500 — $ 30,500 * Totals may not sum due to rounding 

 

15 Footnotes: 1. In mid-March 2018, we entered into an asset purchase agreement with a private, strategic buyer for the sale of our PlaneTechs service line, which resulted in a pre-tax gain of $1.4 million. 2. Amortization of intangible assets of acquired businesses as well as accretion expense related to the SIMOS acquisition earn-out. 3. Implementation costs for cloud-based systems. 4. Total tax effect of each of the adjustments to U.S. GAAP net income using the expected ongoing rate of 16 percent for 2018, due to the enacted U.S. Tax Cuts and Jobs Act, and 28 percent for 2017. 5. Adjustment of the effective income tax rate to the expected ongoing rate of 16 percent for 2018, due to the enacted U.S. Tax Cuts and Jobs Act, and 28 percent for 2017. 6. These third-party processing fees are associated with generating the Work Opportunity Tax Credits, which are designed to encourage employers to hire workers from certain targeted groups with higher than average unemployment rates and reduce our income taxes. 

 

April 2018 

 

Forward-Looking Statements April 2018 

 

Investment Highlights April 2018 3 Track record of favorable growth and investor returns Strong free cash flow and balance sheet 

 

TrueBlue at a Glance April 2018 4 108,000 Customers served annually with strong diversity1 740,000 People connected to work during 2017 One of the largest U.S. industrial staffing providers #1 Global RPO provider2 2013-2017 Average Return on Equity3 2013-2017 Revenue CAGR $2.5B 2017 Revenue 11% Growth 16% Return PeopleScout named a Leader and Star Performer by Everest Group for service delivery, technology and buyer satisfaction HRO Today magazine repeatedly recognizes PeopleScout as a global market leader Thousands of veterans hired per year via internal programs as well as Hiring Our Heroes and Wounded Warriors Recognized as a Corporate Champion by the Women’s Forum of New York for board diversity 1 No single customer accounted for more than 3% of total revenue for FY 2017. 2 Source: Everest Group. Overall recruitment process outsourcing rankings by annual number of hires (2017). 3 Calculated as adjusted net income divided by average shareholders’ equity over the prior four quarters. 

 

Three Specialized Segments Meet Diverse Customer Needs April 2018 On-site contingent workforce management solutions1 1 We use the following distinct brands to market our PeopleManagement contingent workforce solutions: Staff Management | SMX, SIMOS Insourcing Solutions and Centerline. 2 Also includes managed service provider business, which provides customers with improved quality and spend management of their contingent labor vendors. 3 Revenue and segment profit calculations based on FY 2017. Starting in FY 2018, we are evaluating performance based on segment revenue and segment profit. Segment profit is comparable to segment adjusted EBITDA amounts reported in prior periods, and this change did not impact the mix of profit by segment. Segment profit includes revenue, related cost of services, and ongoing operating expenses directly attributable to the reportable segment. Segment profit excludes goodwill and intangible impairment charges, depreciation and amortization expense, unallocated corporate general and administrative expense, interest, other income and expense, income taxes, and costs not considered to be ongoing costs of the segment. Revenue mix3 60% 32% 8% Segment profit3 54% 19% 27% Margin 5% 3% 21% 

 

Solving Workforce Challenges Globally April 2018 6 complex global diverse age 65 will be almost double worker shortage growth 1 Bureau of Labor Statistics Employment Projections: Occupations with the most job growth, 2016-2026. Industrial staffing and RPO jobs: #2: food prep/serving workers, #8: labor, freight, stock, and material movers, #12: construction laborers and #16: customer service representatives. 2 U.S. Census Bureau, An Aging Nation: The Older Population in the United States (2014). robust workforce solutions 

 

Strong Position in Attractive Vertical Markets April 2018 7 Construction Manufacturing Transport & Wholesale Retail & Services In d u s tr y D y n a m ic s            FY-17 Business Mix: 23% FY-17 Business Mix: 26% FY-17 Business Mix: 22% FY-17 Business Mix: 20% Housing Starts Have Not Kept Pace U.S. Manufacturing Renaissance Wholesale Trade At New High E-commerce Growing % of Retail Sales Source: U.S. Census Bureau Source: U.S. Board of Governors of the Federal Reserve System (FRB) Source: Bureau of Labor Statistics Source: U.S. Census Bureau 60 65 70 75 80 85 90 95 100 105 110 19 90 19 93 19 96 19 99 20 02 20 05 20 08 20 11 20 14 20 17 Industrial Production Index 3.0 3.5 4.0 4.5 5.0 5.5 19 90 19 93 19 96 19 99 20 02 20 05 20 08 20 11 20 14 20 17 Transportation and Warehousing Employment Millions - 500 1,000 1,500 2,000 2,500 150 170 190 210 230 250 270 290 310 330 350 19 70 19 75 19 80 19 85 19 90 19 95 20 00 20 05 20 10 20 15 US Population Housing Permits Millions Thousands 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 19 93 19 96 19 99 20 02 20 05 20 08 20 11 20 14 20 17 E-commerce % of Retail Sales 

 

Powerful Secular Forces in Industrial Staffing April 2018 8 6% Growing Market       o o  o o      Positive Demographic Trends Temporary Help Penetration Growth Compelling Technology Rise of E-commerce On-Shoring Comeback 1 Source: Staffing Industry Analysts. 2 Source: TrueBlue estimate based on 6% CAGR from 2018 to 2025. 3 Source: Bureau of Labor Statistics. 

 

Segment Strategy Highlights April 2018 Boost shareholder returns through share repurchase Grow On-Premise Solutions  Differentiated offering  Perfect fit for larger customers with longer-duration / strategic need for contingent workers  Strength in the e- commerce vertical Well Positioned  Recognized global leader  High growth market  Attractive margins Leverage Digital Strategy  Best-in-class proprietary technology (Affinix™)  Mobile-first, AI-enabled, cloud-based platform  Streamlines the candidate sourcing process Leverage Digital Strategy  Compelling technology + established branch network  Value creation: 24/7 order fulfilment, enhanced customer/worker experience  15%+ margins on incremental revenue 

 

JobStackTM Mobile App – A Competitive Differentiator April 2018 JobStackTM is a next generation mobile app that algorithmically matches workers with available jobs.  24/7 order creation  Real-time order fill rates  Associate ratings  Worksite ratings  Work week control Driving Value for TrueBlue Compelling Technology CUSTOMER ASSOCIATE  Round-the-clock revenue generation  Improved associate experience  Lift associate quality  Enhanced communication & safety  Tap into larger and more diverse talent pool 

 

On-premise and E-commerce April 2018 E-commerce Vertical Leadership  Labor intensive pick-and-pack movement v. traditional bulk pallets  Increasing demand for PeopleManagement's ability to deliver a flexible, fully sourced and managed workforce Driving On-premise  Perfect fit for larger customers with longer-duration / strategic need for contingent workers  Staff Management is PeopleManagement's flagship on- premise solution and a recognized industry leader 

 

PeopleScout: Attractive Margin and Rapid Growth April 2018 21% 9% FY-17FY-15 Segment Profit Margin PeopleScout TBI Total  Industry Leadership o #1 global provider of enterprise RPO1 o Emerging healthcare vertical strength  Differentiated Service Proprietary technology drives value-add recruitment capabilities  Growing Market 12% global market growth CAGR2  Global Prospects Opportunity to broaden footprint in Europe and Asia Pacific 1 Source: Everest Group. Overall RPO rankings by annual number of hires (2017). 2 Source: NelsonHall (2018). Represents estimated market CAGR from 2017-2022. 4% 8% 5% 27% FY-15 FY-17 PeopleScout % of Total Company Results Revenue Segment Profit 

 

Well Positioned to Boost Shareholder Returns with Buybacks 1 $100 million stock repurchase authorization announced on 30 October, 2017. $93 million remaining under the authorization as of 31 March, 2017. 2 Calculated as net cash provided by operating activities, minus purchases for property and equipment. 3 See the appendix to this presentation and “Financial Information” in the Investors section of our website at www.trueblue.com for a definition and full reconciliation of non-GAAP financial measures to GAAP financial results. 4 Calculated as adjusted net income divided by average shareholders’ equity at the end of the prior four quarters.    $31 $54 $233 $78 2014 2015 2016 2017 1.7x 1.7x 0.9x 1.0x 2014 2015 2016 2017 17% 17% 17% 13% 2014 2015 2016 2017 millions 

 

 

April 2018 15 NON-GAAP FINANCIAL MEASURES AND NON-GAAP RECONCILIATIONS In addition to financial measures presented in accordance with U.S. GAAP, we monitor certain non-GAAP key financial measures. The presentation of these non-GAAP financial measures is used to enhance the understanding of certain aspects of our financial performance. It is not meant to be considered in isolation, superior to, or as a substitute for the directly comparable financial measures prepared in accordance with U.S. GAAP, and may not be comparable to similarly titled measures of other companies. Non-GAAP Measure Definition Purpose of Adjusted Measures EBITDA and Adjusted EBITDA EBITDA excludes from net income (loss): - interest and other income (expense), net, - income taxes, and - depreciation and amortization. Adjusted EBITDA, further excludes: - acquisition/integration and other costs, - goodwill and intangible asset impairment charge, and - Work Opportunity Tax Credit third-party processing fees. - Enhances comparability on a consistent basis and provides investors with useful insight into the underlying trends of the business. - Used by management to assess performance and effectiveness of our business strategies. - Provides a measure, among others, used in the determination of incentive compensation for management. Adjusted net income and Adjusted net income, per diluted share Net income (loss) and net income (loss) per diluted share, excluding: - acquisition/integration and other costs, - goodwill and intangible asset impairment charge, - amortization of intangibles of acquired businesses, as well as accretion expense related to acquisition earn-out, - tax effect of each adjustment to U.S. GAAP net income (loss), and - adjusted income taxes to the expected effective tax rate. - Enhances comparability on a consistent basis and provides investors with useful insight into the underlying trends of the business. - Used by management to assess performance and effectiveness of our business strategies. Free cash flow Net cash provided by operating activities, minus cash purchases for property and equipment. - Used by management to assess cash flows 

 

1. RECONCILIATION OF U.S. GAAP NET INCOME (LOSS) TO ADJUSTED NET INCOME AND ADJUSTED NET INCOME, PER DILUTED SHARE (Unaudited) April 2018 16 2017 2016 2015 2014 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended 52 Weeks Ended (in thousands, except for per share data)* Dec 31, 2017 Jan 1, 2017 Dec 25, 2015 Dec 26, 2014 Net income (loss) $ 55,456 $ (15,251 ) $ 71,247 $ 65,675 Acquisition/integration and other costs (1) 162 12,223 5,135 5,220 Goodwill and intangible asset impairment charge (2) — 103,544 — — Amortization of intangible assets of acquired businesses (3) 22,290 27,069 19,903 12,046 Tax effect of adjustments to net income (loss) (4) (6,287 ) (39,994 ) (7,011 ) (4,834 ) Adjustment of income taxes to normalized effective rate (5) 380 606 (1,805 ) (6,747 ) Adjusted net income $ 72,001 $ 88,197 $ 87,469 $ 71,360 Adjusted net income, per diluted share $ 1.74 $ 2.10 $ 2.10 $ 1.73 Diluted weighted average shares outstanding 41,441 41,968 41,622 41,176 2. RECONCILIATION OF U.S. GAAP NET INCOME (LOSS) TO EBITDA AND ADJUSTED EBITDA (Unaudited) 2017 2016 2015 2014 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended 52 Weeks Ended (in thousands) Dec 31, 2017 Jan 1, 2017 Dec 25, 2015 Dec 26, 2014 Net income (loss) $ 55,456 $ (15,251 ) $ 71,247 $ 65,675 Income tax expense (benefit) 22,094 (5,089 ) 25,200 16,169 Interest and other income (expense), net 14 3,345 1,395 (116 ) Depreciation and amortization 46,115 46,692 41,843 29,474 EBITDA 123,679 29,697 139,685 111,202 Acquisition/integration and other costs (1) 162 12,223 5,135 5,220 Goodwill and intangible asset impairment charge (2) — 103,544 — — Work Opportunity Tax Credit processing fees (6) 805 1,858 2,352 3,020 Adjusted EBITDA $ 124,646 $ 147,322 $ 147,172 $ 119,442 See the last slide of the appendix for footnotes. 

 

April 2018 17 3. RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOWS (Unaudited) 2017 2016 2015 2014 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended 52 Weeks Ended (in thousands) Dec 31, 2017 Jan 1, 2017 Dec 25, 2015 Dec 26, 2014 Net cash provided by operating activities $ 99,851 $ 261,754 $ 72,072 $ 47,525 Capital expenditures (21,958 ) (29,042 ) (18,394 ) (16,918 ) Free cash flows $ 77,893 $ 232,712 $ 53,678 $ 30,607 See the last slide of the appendix for footnotes. 

 

April 2018 18 Footnotes: 1. Acquisition/integration and other costs related to the acquisition of the recruitment process outsourcing business of Aon Hewitt, which was completed on January 4, 2016, the acquisition of SIMOS, which was completed on December 1, 2015, the acquisition of Seaton, which was completed on June 30, 2014, the acquisition of MDT, which was completed on February 4, 2013, the acquisition of The Work Connection, which was completed October 1, 2013 and the acquisition of certain assets of Crowley Transportation Services, which was completed June 2013. In addition, other charges for the fiscal year ended December 31, 2017, include a workforce reduction charge of $2.5 million primarily associated with employee reductions in the PeopleReady business, offset by $2.3 million of workers' compensation benefit. The workers' compensation benefit is associated with the favorable settlement of insurance coverage associated with a former insurance company and other items not considered part of our core operations. Other charges for the fiscal year ended January 1, 2017, consist of costs of $2.6 million associated with our exit from the Amazon delivery business, $1.3 million adjustment to increase the earn-out associated with the acquisition of SIMOS, and branch signage write branch signage write- offs of $1.6 million due to our re-branding to PeopleReady. 2. The Goodwill and intangible asset impairment charge for the fiscal year ended January 1, 2017, included $99.3 million of impairment charges relating to our Staff Management | SMX, hrX, and PlaneTechs reporting units, and write-off of the CLP and Spartan reporting unit trade names/trademarks of $4.3 million due to the re- branding to PeopleReady. Note, our PeopleScout and hrX service lines were combined during fiscal 2016 and now represent a single operating unit (PeopleScout). 3. Amortization of intangible assets of acquired businesses as well as accretion expense related to the SIMOS acquisition earn-out. 4. Total tax effect of each of the adjustments to U.S. GAAP net income (loss) using the expected rate of 28 percent. 5. Adjustment of the effective income tax rate to the expected rate of 28 percent. 6. These third-party processing fees are associated with generating the Work Opportunity Tax Credits, which are designed to encourage employers to hire workers from certain targeted groups with higher than average unemployment rates and reduce our income taxes.