Insperity, Inc. (NYSE:NSP) Q1 2022 Earnings Conference Call April 26, 2022 8:30 AM ET

Company Participants

Paul Sarvadi - Management Director, Chairman and Chief Executive Officer

Douglas Sharp - Senior Vice President, Finance, Chief Financial Officer and Treasurer

Conference Call Participants

Andrew Nicholas - William Blair

Tobey Sommer - Truist

Jeff Martin - ROTH Capital Partners

Mark Marcon - Baird

Operator

Good morning. My name is Jane and I will be your conference operator today. I would like to welcome everyone to the Insperity First Quarter 2022 Earnings Conference Call.

At this time, I would like to introduce today’s speakers. Joining us are Paul Sarvadi, Chairman of the Board and Chief Executive Officer; and Douglas Sharp, Senior Vice President of Finance, Chief Financial Officer and Treasurer.

At this time, I would like to turn the call over to Douglas Sharp. Mr. Sharp, please go ahead.

Douglas Sharp

Thank you. We appreciate you joining us. Let me begin by outlining our plan for this evening's call. First, I'm going to discuss the details behind our first quarter 2022 financial results. Paul will then comment on the key drivers behind our Q1 results and our plan over the remainder of the year. I will return to provide our financial guidance for the second quarter and an update to the full year guidance. We will then end the call with a question and answer session. Now before we begin I would like to remind you that Mr. Sarvadi or I may make forward looking statements during today's call, which are subject to risks, uncertainties and assumptions. In addition, some of our discussion may include non GAAP financial measures years. For a more detailed discussion of the risks and uncertainties that could cause actual results to differ materially from any forward-looking statements, and reconciliations of non-GAAP financial measures, please see the company's public filings, including the form 8-K file today, which are available on our website.

Now, let's discuss our strong first quarter results in which we exceeded both our worksite employee growth and earnings expectations. We achieved adjusted EBITDA of $119 million, up 14% increase over Q1 of 2021 and adjusted earnings per share of $1.99. These results reflect growth in the average number of paid worksite employees above the high end of our forecasted range, pricing above target levels, effective management of our direct calls programs, and operating leverage. As for our growth metrics, the average number of paid worksite employees increased by 19.5% over Q1 of 2021. As most of you are aware of the year in transition from 2021 to 2022, in which we enroll new clients from our fall sales campaign, and renew approximately 45% of our existing clients was important to our 2022 starting point, and therefore our full year growth expectations.