Fourth-quarter revenue at TrueBlue Inc. (NYSE: TBI), a provider of industrial staffing and RPO, fell 10.3% year over year. Gross margin also contracted by 30 basis points due to lower, high-margin volumes offset by favorable bill/pay spread inflation and lower workers’ compensation costs.

The Tacoma, Washington-based company reported revenue fell 13.3% in its PeopleReady segment, which provides on-demand contingent general and skilled labor. Demand declined year over year but was steady within the quarter as it followed historical sequential trends.

Revenue also fell 16.2% at TrueBlue’s PeopleScout division, which provides RPO and MSP solutions; TrueBlue attributed the decline to lower volumes as certain clients revert to pre-Covid levels and others reduce hiring given economic uncertainty.

In the PeopleManagement segment, revenue edged down 1.9% due to lower demand. PeopleManagement offers contingent, on-site industrial staffing and commercial driver services.

“We executed well during the quarter despite macroeconomic conditions,” said CEO Steve Cooper. “Disciplined pricing, improved worker supply and effective cost management helped offset a decline in revenue.

“Our services provide appealing solutions for companies in need of operational and strategic flexibility,” Cooper said. “Our workforce services are well-positioned to assist companies in overcoming secular shortages of blue-collar labor, while our recruitment process outsourcing services address talent challenges across all types of work.”

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Guidance

TrueBlue expects first-quarter 2023 revenue to decline between 13% and 18%, as during the first half of 2022, PeopleReady benefited from a high volume of retail projects and above-average base business results, which are not expected to fully repeat. It expects gross margin to expand between 70 and 110 basis points due to lower workers’ compensation costs and favorable spreads between bill- and pay-rate inflation.

For full-year 2023, TrueBlue expects gross margin to hold relatively steady, ranging from up 30 basis points to down 30 basis points compared to full-year 2022.

Share price and market cap

Shares in TrueBlue were down 11.04% to $17.87 as of 11:43 a.m. Eastern time; they were 13.33% above their 52-week low, according to FT.com. The company had a market cap of $657.32million.