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This presentation contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties. Factors that could.

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Presentation on theme: "This presentation contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties. Factors that could."— Presentation transcript:

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2 This presentation contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties. Factors that could cause future results to differ from current expectations include risks associated with the company’s, competition, changing market and economic conditions, acquisitions/divestitures, corporate strategy, currency fluctuations and additional factors discussed in this presentation and in Spherion’s filings with the Securities and Exchange Commission. The company’s actual results may differ materially from any projections contained in this presentation. Additionally, this presentation includes certain Non-GAAP financial measures. Management believes the Non-GAAP financial measures are useful in evaluating its operations but should not be considered in isolation or as an alternative to financial measures of performance as determined by generally accepted accounting principles. See May 3, 2006 Earnings Release for a reconciliation of Non-GAAP financial measures to our GAAP financial results. Spherion Corporation June 13, 2006 “Safe Harbor Statement” 2

3 3 About Spherion Our foundation for growth  Diversified staffing company —60 + years experience —650 company owned, license & franchise locations —7 th largest in U.S.  North American Focused —$80+ billion market —Top 5 competitors = 15% —50% of market is professional  Leverageable model —Breadth of skills and services —National office network —Modern technology $2.7 $2.2 $1.8 $1.7 $2.0 REVENUES (in billions) $2.0

4 4 About Spherion Strategic Evolution Create Value Deliver integrated solutions in staffing and recruiting 2005 Refine Strategic Focus 2006 Grow & Leverage 2007+ Lead & Consolidate CREATE VALUE Customer Candidates Shareholders  Targeted growth  Gross profit margin expansion  Operational effectiveness  Financial discipline

5 5 About Spherion Competitive Positioning Providing Integrated Solutions Leading the Industry Meeting Evolving Needs of Customers & Candidates Delivering Service Excellence Meeting Evolving Needs of Customers & Candidates Delivering Service Excellence Integrated Company Integrated Expertise & Knowledge Integrated with clients Integrated Services

6 6 Strategic Initiatives Targeted Growth & Margin Expansion 55% 40% 45% 60% 20042007 LargeSmall/Medium New Business Focus:  Increase mid-marketpenetration  Expand relationshipbusiness  Maintain large accountbase

7 7 Strategic Initiatives Operational Effectiveness  Branch Network —Fill unused capacity and increase productivity – More recruiters, more calls, more assignments —Optimize service mix – Perm placement and client mix —Increase candidate flow  Centralized Recruiting —Lower cost delivery —Project/recruitment outsourcing Improve Operating Leverage:

8 8 Strategic Initiatives Priorities 2006 Grow & Leverage  Targeted growth  Gross profit margin expansion  Operational effectiveness  Financial discipline

9 Financial Update Teri Miller

10 10 TARGETED GROWTH MARGIN EXPANSION OPERATIONAL EFFECTIVENESS FINANCIAL DISCIPLINE  Grow REVENUE at or better than market  Expand GP MARGIN +50 BP per year  Reduce SG&A to 80% of gross profit  Lower DSO by 1 day per quarter +110 BP 93.1% - 6 days FY 2005 FY 2005 - 2% Financial Update Progress against our goals +170 BP 96.8% - 1 day Q1‘06 - 8.6%

11 11 Financial Update Balance Sheet & Cash Flow (in millions) 20042005Q1 ‘06 Cash$5.2$30.2$31.7 Debt($49.3)($6.9)($5.9) Net Debt($44.1)$23.3$25.8 Net Debt to Capital 9.1%(5.6%)(6.4%) Operating CF$6.1$71.8$18.0 Cap Ex$12.1$9.7$6.9 Share Repurchase-$24.0$14.1 DSO605453 Goal: reduce DSO by 1 day per qtr. In 2006 1 Day of DSO = $5.1M cash

12 12 Financial Update Quarterly Trend & Guidance Q2Q1 Q2Q3Q4 Revenue $465 to $485$464$506$477$492$497 y/y Growth(3.0%) to 1.2%(8.6%)8.2%(1.9%)(3.0%)(9.0%)* Seq. Growth0.0% to 4.4%(7.1%) (7.4%)*(5.7%)3.3% 0.9% Gross Profit $105 $110$114 Temp GP%18.2%17.6%18.3%18.4%19.0% Total GP%22.5%20.8%22.0%22.4%23.0% EBIT $3.4 $1.5$3.8$9.3$13.6 EPS** $0.04 to $0.08$0.04$0.02$0.04$0.11$0.15 2006 2005 *Excludes impact of 53 rd week **EPS from continuing operations

13 13 Positioned for Growth Formula for Success  Strategy aligns most attractive part of market and our capabilities  Sales team aligned with targeted customer segments  Specialized delivery teams aligned with customer values and candidate trends  Rewards aligned with delivering shareholder value


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