Question-and-Answer Session
Operator
(Operator instructions) And first go to the line of T.C. Robillard with Signal Hill Capital Group. Please go ahead.
Carl Camden
Hi, T.C.
T.C. Robillard – Signal Hill Capital Group
Great, thank you. Good morning Carl. Good morning Patricia.
Carl Camden
Are you arranged, by the way, to always be the first caller?
T.C. Robillard – Signal Hill Capital Group
Yes. It's not like that on all calls. So, I just figured you guys might like me more than everybody else.
Carl Camden
Absolutely. What can I do for you T.C.?
T.C. Robillard – Signal Hill Capital Group
I just wanted to make sure I'm understanding correctly, the fact that revenues were up sequentially, but gross margins down even though perm was flat quarter-to-quarter, it sounds – is that purely mix related or was there any type of incremental pricing pressure that you guys might have seen?
Carl Camden
If there was significant incremental pricing pressure, we would have talked about it. We did specifically talk about it as an example in the case of Russia. In general, T.C., if I can be really simplistic, because there's – there were different stories by segment, but in general as the recovery begins, it is the lower GP type of products that recover first. And as an example, Light Industrial, which we talked a lot about in the U.S. has been rebounding nicely and steadily. But, as you have a rebound there and you don't have a rebound in some of the higher priced PT or even office side, it just changes your mix.
T.C. Robillard – Signal Hill Capital Group
Okay. And then how – and I know this is going to be challenging because no two recessions, no two recoveries are alike. But, how should we be thinking about the proportion of Light Industrial as we're going through this? And I guess what I'm trying to get a sense for is, how much more deterioration do we see in that gross profit line even though it looks like revenues should probably start to grow slightly sequentially?
Carl Camden
That's a fine question and it just depends on the model. I don't, I have to tell you, we don't know. We very specifically said that we saw stabilization and the slight beginnings of upturns in office clerical. But obviously, if you are talking now just specifically about Americas Commercial GP, until the growth rate in office staffing is at least as high as the growth rate in Light Industrial, it will be tough to not see some deterioration in GP lines until the placement fees and conversion fees bounce back. That's just a mathematical outcome of the progression of what type of jobs bounce back first. But, I don't have the crystal ball to tell you what the – how fast one recovers versus the other. But right now, LID is bouncing back steadily and we are just beginning to see the stabilization and slight improvements in office clerical.
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