Name: VOLT INFORMATION SCIENCES, INC. Q4 2020 Earnings Call
Start: 2021-03-16T16:10:25.000Z

Executive Summary

Q4 2020 revenue was $211.1M with gross margin of 16.2%; GAAP EPS was $(0.58), while Adjusted EPS was $0.11 driven by $15.0M of impairment and restructuring charges excluded in non‑GAAP results .
Adjusted EBITDA reached $5.9M, the highest quarterly level in four years, reflecting cost controls and mix shift; management expects continued improvement in profitability in FY2021 .
Sequential recovery continued into Q4 from Q3 ($185.9M revenue; 16.1% GM), with North American Staffing stabilizing and MSP payroll mix weighing on gross margin rate .
Formal revenue guidance remained withdrawn in Q4 (carried from Q3); qualitative outlook turned constructive for FY2021, citing streamlined operations and disciplined pricing .
Third-party coverage (Zacks) indicated a beat vs consensus (Adj. EPS $0.11 vs $0.01; revenue +2.7% vs consensus), though S&P Global consensus was unavailable via our tool . S&P Global estimates unavailable via GetEstimates tool.

What Went Well and What Went Wrong

Highest quarterly Adjusted EBITDA in four years ($5.9M), with management highlighting “sequential improvement in Adjusted Revenue” in 2H20 and improved sales/pricing discipline .
SG&A reduced materially: Q4 SG&A of $30.7M was down $6.5M YoY after normalizing for the prior-year 14th week and a business exit, driven by lower salaries and professional fees .
CEO tone constructive: “We are confident we will continue to see improvement in profitability for the full-year of fiscal 2021,” underpinned by sales strategy maturation, disciplined pricing, and streamlined operations .

Reported GAAP operating loss of $(11.5)M in Q4 due to $14.5M of impairment (leased real estate consolidation) and $0.4M restructuring, despite underlying adjusted operating improvement .
Gross margin rate declined 40 bps YoY to 16.2% on mix shift toward lower-margin payroll services in North American MSP, partially offsetting staffing margin progress .
International Staffing remained weak (UK-driven), with segment revenue down to $23.0M in Q4 from $30.6M prior year and adjusted revenue down 22% YoY .

Metric	Q2 2020 (May 3)	Q3 2020 (Aug 2)	Q4 2020 (Nov 1)
Revenue ($M)	$207.275	$185.941	$211.073
Gross Margin ($M)	$32.237	$29.958	$34.229
GAAP Operating Income (Loss) ($M)	$(4.363)	$(4.217)	$(11.462)
GAAP EPS (Basic/Diluted)	$(0.25)	$(0.22)	$(0.58)

Segment ($M)	Q4 2019 (Nov 3)	Q3 2020 (Aug 2)	Q4 2020 (Nov 1)
North American Staffing	$216.587	$154.711	$178.603
International Staffing	$30.574	$21.749	$23.033
North American MSP	$11.659	$9.436	$9.365
Corporate & Other	$0.187	$0.149	$0.135
Eliminations	$(0.599)	$(0.104)	$(0.063)
Total Revenue	$258.408	$185.941	$211.073

KPI	Q2 2020	Q3 2020	Q4 2020
Work Days	65	63	64
SG&A ($M)	$36.189	$31.245	$30.735
Restructuring & Severance ($M)	$0.411	$0.546	$0.438
Impairment ($M)	$—	$2.384	$14.518

Metric/Topic	Period	Previous Guidance	Current Guidance	Change
Adjusted Revenue	Q4 2020	n/a	Company not providing Adjusted Revenue guidance (continued uncertainty)	Withdrawn/Not provided
Profitability Outlook	FY 2021	n/a	“Expect continued improvement in profitability for 2021”	Positive qualitative outlook
Operating Trend (next quarter)	Q2 2021	n/a	Expect sequential and YoY operating improvement despite weather-related disruptions	Positive qualitative outlook

Topic	Q2 2020 (Prev-2)	Q3 2020 (Prev-1)	Q4 2020 (Current)	Trend
COVID-19 impact on demand	Client facility closures, reduced demand; ongoing cost actions	Month-over-month improvement; positive Adj. EBITDA; still pandemic headwinds	Sequential Adjusted Revenue improvement in 2H; highest Adj. EBITDA in 4 years	Gradual recovery
Cost structure/real estate	Began consolidating/exit of leases; impairments	Continued real estate rationalization; impairments	$14.5M impairment tied to lease exits; SG&A reduced YoY	Structural cost down
Pricing and sales strategy	—	Emphasis on sales wins and cost focus	“Improved sales strategy and disciplined pricing” underpin outlook	Improving commercial execution
Mix/MSP impact	—	MSP relatively stable; payroll mix noted	Mix shift toward payroll within MSP pressured GM%	Margin headwind from mix
International/UK	—	Reduced UK work orders	UK-driven weakness persists; Int’l down YoY	Soft

“The disruption caused by COVID-19 forced us to think and work differently… These efforts are reflected in the sequential improvement in Adjusted Revenue… In addition, our fourth quarter Adjusted EBITDA was our best quarter in four years.” — Linda Perneau, President & CEO .
“Through the maturation of our sales strategy coupled with our disciplined pricing approach and streamlined operations, we are confident we will continue to see improvement in profitability for the full-year of fiscal 2021.” — Linda Perneau .
“Throughout the third quarter we posted month-over-month improvements in Adjusted Revenue and gross margin… We believe these trends will continue in the fourth quarter as we remain focused on our growth and profitability initiatives.” — Linda Perneau (Q3) .

Full Q4 2020 earnings call transcript was not available in our document system; the company hosted its call on Jan 13, 2021 at 5:00 p.m. ET and posted a webcast replay for 90 days . As a result, Q&A specifics and analyst follow-ups cannot be verified from primary transcripts here.

S&P Global consensus estimates were unavailable via our GetEstimates tool for VOLT at this time; we would typically anchor to S&P Global for EPS and revenue consensus comparisons (tool mapping missing).
Third‑party coverage (Zacks via Investing.com) reported Q4 Adj. EPS of $0.11 vs $0.01 consensus and revenue of $211.07M beating consensus by 2.71% (indicating an EPS and revenue beat). Treat as indicative only given source; we were unable to verify S&P Global consensus directly .

Sequential recovery intact: revenue rebounded to $211.1M in Q4 from $185.9M in Q3, with the business demonstrating operating leverage as Adjusted EBITDA expanded to $5.9M, the best in four years .
Margin mix watch: gross margin rate dipped 40 bps YoY to 16.2% due to MSP payroll mix; sustainability of mix normalization is a key lever for 2021 margin trajectory .
Cost structure reset: real estate consolidation drove sizable impairments in Q4, but SG&A is structurally lower, positioning for improved flow‑through as volumes rise .
Segment dynamics: North American Staffing is stabilizing with sequential growth; International (UK) remains a drag; MSP revenues are steady but carry lower margin .
Outlook constructive but qualitative: no formal revenue guidance; management expects improved profitability in FY2021; monitor early FY2021 prints (Q1/Q2) for confirmation of run-rate improvements .
Trading lens: absent S&P Global estimate anchors, third‑party indicators point to an EPS and revenue beat in Q4; catalysts include continued Adjusted EBITDA expansion and evidence of sticky cost savings .

Additional references and prior-quarter context: