Insperity, Inc. (NYSE:NSP) Q4 2023 Earnings Conference Call February 8, 2023 8:30 AM ET

Company Participants

Paul Sarvadi - Chairman and Chief Executive Officer

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

Conference Call Participants

Andrew Nicholas - William Blair

Mark Marcon - Baird

Tobey Sommer - Truist

Jeff Martin - Roth MKM

Operator

Good morning. My name is Paul and I will be your conference operator today. I would like to welcome everyone to the Insperity Fourth Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note this conference is being recorded.

At this time, I would like to introduce today's speakers. Joining us are Paul Sarvadi, chair of the board -- chairman of the Board and Chief Executive Officer, and Douglas Sharp, executive Vice President of Finance, chief Financial Officer and treasurer.

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

Douglas Sharp

Thank you. We appreciate you joining us. I'm sure you've seen the exciting news announcing our strategic partnership with Workday released this morning. Our call today will be largely focused on the strategic partnership and how it fits into our long-term plan. However, we will begin by discussing the results of our fourth quarter and full-year 2023 results and end the call with a discussion of our outlook for 2024, which includes the strategic partnership with Workday.

Now, before I 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. for a more detailed discussion of the risks and uncertainties that could cause actual results to differ materially from any forward-looking statements and reconciliation of non-GAAP financial measures, please see the company's public filings including the Form 8-K filed today, which are available on our website.

Now, let's discuss our fourth quarter results, in which we achieved $0.75 in adjusted EPS and $56 million of adjusted EBITDA, both above our expectations. our growth in paid worksite employees continued to be impacted by macroeconomic headwinds, particularly the significant decline in our hiring base over the past year.

In fact, minimal hiring in our clients -- client base experienced over the first half of 2023 turned into a low level of net reductions in the latter half. This contributed to paid worksite employee growth in Q4 of 2.5%, slightly below the low end of our forecasted range. In a few minutes, Paul and I will comment further on the outcome of our recent sales campaign and heavy client renewal period leading into our 2024 growth outlook.