Kforce Inc. (NASDAQ:KFRC) Q2 2022 Earnings Conference Call August 1, 2022 5:00 PM ET

Company Participants

Joe Liberatore - President and Chief Executive Officer

Kye Mitchell - Executive Vice President and Chief Operations Officer

Dave Kelly - Executive Vice President, Chief Financial and Administrative Officer

Conference Call Participants

Sam Kusswurm - William Blair

Kartik Mehta - Northcoast Research

Marc Riddick - Sidoti

Jasper Bibb - Truist Securities

Operator

Goo day. And welcome to the Kforce Second Quarter 2022 Earnings Conference Call. Today’s call is being recorded. [Operator Instructions]

I would now like to turn the conference over to Joe Liberatore, President and Chief executive Officer. Please go ahead.

Joe Liberatore

Good afternoon. This call may contain certain statements that are forward-looking. These statements are based upon current assumptions and expectations and are subject to risks and uncertainties. Actual results may vary materially from the factors listed in Kforce’s public filings and other reports and filings with the Securities and Exchange Commission. We cannot undertake any duty to update any forward-looking statements. You can find additional information about our results in our earnings release and our SEC filings.

In addition, we have published our prepared remarks within the Investor Relations portion of our website.

I am pleased with our solid overall performance in the second quarter, which was fueled again by significant sequential and year-over-year growth in our Technology business. There is no doubt that the macro environment has become a bit cloudier over the last several months with persistent historically elevated levels of inflation, which has been at least partially fueled by stimulus activities throughout the pandemic and the continued crisis in Ukraine, significantly rising interest rates and ongoing supply-chain challenges. These and other factors have raised concern as to the pace of overall economic growth.

We believe that we are ideally positioned heading into this uncertain macro landscape, however it ultimately plays out. Our confidence is grounded in our strategic position with nearly 90% of our business concentrated in providing high-end technology talent solutions to a diversified set of world-class companies, in attractive end markets, a debt-free balance sheet and improved profitability levels that gives us the flexibility to continue investing in our business. To that end, it is important to remember that flex revenues in our Technology business, which comprised roughly 50% of overall revenue at the time, was only down 7% during the 2008/2009 financial crisis, and in 2020 comprised 75% of overall revenue and was virtually flat when economic growth abruptly contracted. The growing strength in the secular drivers of demand in technology, which the pandemic has only accelerated further, gives us the confidence that we are relatively insulated during adverse economic times. Technology remains core to all business strategies regardless of industry and we don’t see that changing.