Hudson Global Inc (HSON) 2014 Q4 法說會逐字稿

Good morning and welcome to the fourth-quarter 2014 earnings conference call. (Operator Instructions)

Thank you. I will now turn the call over to David Kirby to begin. Please go ahead, sir.

Thank you, operator, and good morning, everyone. Welcome to the Hudson Global conference call for the fourth quarter of 2014. Our call this morning will be led by Chairman and Chief Executive Officer Manolo Marquez and Executive Vice President and Chief Financial Officer Stephen Nolan.

Please be advised that except for historical information, the statements made during the presentation constitute forward-looking statements under applicable securities laws. Such forward-looking statements involve certain risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements.

These risks are discussed in our Form 8-K filed today and our other filings made with the SEC. The Company disclaims any obligation to update any forward-looking statements.

During the course of this conference call, references will be made to non-GAAP terms such as EBITDA, and EBITDA reconciliation is included in our earnings release and quarterly slides, both posted on our website, Hudson.com. I encourage you to access these materials at this time. They are featured on the website under featured documents and will serve as helpful reference guides during our speakers' remarks.

With that, I will turn the call over to Manolo.

Thank you, David. Thank you all for joining us on our 2014 full-year and fourth-quarter earnings call.

Our fourth-quarter 2014 results showed increased traction in Hudson's turnaround. Revenue on gross margins were $137 million and $53 million, respectively, up 3% and 6% in constant currency. This was our fourth consecutive quarter of revenue and gross margin growth on a constant currency basis.

Our adjusted EBITDA for the quarter was a loss of $2.4 million, near the mid range of our guidance, which compares to a loss of $2 million in the fourth quarter of 2013. In the last quarter of 2014 we carried $0.5 million of stranded costs in North America tied to the divestiture of our eDiscovery business, as well as performance-based bonus accruals for the managers who met their annual targets.

Our full-year gross margin from continuing operations grew 7% in constant currencies. Our adjusted EBITDA for the year was a loss of $7.5 million, an improvement of $7 million for 2013, or $8.4 million excluding our AlixPartners engagement and proxy contest costs.

In 2014 we partially benefited from the savings associated with a restructuring program designed with AlixPartners, which we have estimated at an annualized minimum of $12 million. Our fourth-quarter cash flow from operations was a positive $2.9 million and we finished 2014 with $34 million in net cash, or about $1 per share.

During 2014 we continued the strategic review of our operations, concentrating our efforts in the areas where our potential to win profitable market share is greatest. We successfully divested our eDiscovery business for $23 million in cash and ceased directs operations in our loss-making market in Sweden.

In parallel, we deployed a focused investment program in our front office in the areas where we have a specialized capability and clear opportunities to scale our business. Our sales and delivery staff grew by a net full-year equivalent of 14% with an investment in related compensation of $10.5 million. The productivity of our new staff has increased gradually throughout the year and will continue to improve during 2015.

Our work to rationalize our operating platform allowed us to reduce our support and administrative costs by an additional $2.7 million, our occupancy costs by $2 million, and our technology costs by $1 million for the year. In 2014, our Board of Directors approved a plan to enhance corporate governance and strengthen stockholder rights, as well as amending our rights agreement to protect our approximately $300 million of US net operating losses. These proposed covenant changes will be presented for approval at our 2015 annual meeting of stockholders.

Our efforts have started to translate into meaningful growth in many of our core businesses during 2014. Our global RPO margin grew by 14%, fueled by 19% growth in Asia-Pacific, where we continue to demonstrate a market leadership position, and 47% growth in the Americas.

Our talent management gross margin grew by 12%, driven by 28% growth in Australia and 14% in Belgium, two markets where we enjoy a clear leadership position in this space. RPO and talent management combined now represent slightly more than one-third of our gross margin.

Our permanent recruitment business, which represents 40% of our gross margins grew by 14%, with strong performances in Australia, China, and Europe, growing by 24%, 30%, and 12%, respectively. Our temporary recruitment business, which represents approximately one-fourth of our gross margin, is proving harder to scale and fell by 8% in 2014. While our work is not yet done, we are certain that Hudson's transformation has passed the inflection point.

We have hired outstanding talent to join our company from industry-leading peers. We have changed the culture of the Company, bringing the processes, operating discipline, and homogeneous businesses practices required by a truly global business. We have reviewed our portfolio and implemented a clearly-focused investment strategy in our core business.

We have rationalized our cost base and deployed a more efficient organizational model. And we have made substantial progress in all of that dealing with the transformation of a highly complex business in an adverse international economic environment.

Looking forward, we are on track, executing the plan outlined to you in our May 2014 investor presentation, which you can find in our website. In 2015, we expect to continue growing our gross margin in our core markets, deliver full-year profitability at the adjusted EBITDA level, and demonstrate a clear path to achieve a return on gross margin within our peer range in 2016.

We have confidence we can achieve these objectives for three main reasons. First, the accelerating growth that many of our core businesses evidenced in 2014, particularly in the areas where we have made most of our investments. Second, the savings that our restructuring efforts have warranted in our support costs and real estate platforms. And, third, our firm decision to bring a sharp focus on our investments in the areas that can demonstrate profitable growth and divest our active non-core assets.

Even as our business fundamentals continue to improve, the international economic scenario remains uncertain, and as we cross our breakeven point, our profitability is sensitive to top-line variations. Notwithstanding this, as said our efforts will remain centered on delivering full-year profitability at the adjusted EBITDA level, and we will give you a regular account on our progress every quarter as well as an update on our 2015 trends.

Today we feel that Europe will be our primary challenge. In addition to temporary improvement, an important priority in 2016 is to restore growth in the UK, where a new management team is deeply committed to ensure Hudson profits from the opportunities offered by these large recruitment markets.

This past year was important for Hudson in many ways. In 2014 we have delivered four consecutive quarters of revenue and gross margin growth in constant currency; reduced our support, occupancy, and technology costs by an additional $5.7 million for the year; successfully divested eDiscovery to bring more focus on our most profitable growth opportunities; invested in consultant headcount to continue driving further growth in 2015; improved adjusted EBITDA by $7 million from the prior years; delivered positive cash flow from operations in the fourth quarter; ended the year with $34 million in cash; and set the base to continue growing our gross margin in our core markets and achieve full-year profitability at the adjusted EBITDA level in 2015.

We are encouraged by these improvements and we will continue working hard in 2015 to realize the full value of the Company. Stephen will now provide more detail on our fourth-quarter performance and outlook.

Thanks, Manolo, and good morning, everyone. For the fourth quarter, group revenue came in at $137 million, up 3% year-over-year in constant currency led by 13% growth in Asia-Pac. RPO revenue grew 28%. Permanent recruitment was up 20%, while talent management was flat and our temp contracting business fell 5%.

Gross margin was $53 million, up 6% year-over-year in constant currency, led by 21% growth in Asia-Pacific. RPO gross margin grew 10% as we saw a higher mix of contracting in that business. Perm recruitment through 20%, while temp contracting fell 6%; mainly weakness in the UK and US.

SG&A costs were $56 million, 7% higher than last year, driven by a 14% increase in fee earner headcount, again mainly Asia-Pacific. The related compensation costs were up $3 million in constant currency. Savings in real estate and other G&A costs were offset by stronger costs in the US related to the sale of eDiscovery as we supported our buyer through our transitional services agreement.

Q4 adjusted EBITDA was a $2.4 million loss compared to a $2 million loss last year.

Turning to regional and country performance, in fourth quarter Americas Q4 gross margin grew 8% compared to last year. RPO delivered another strong performance with a 46% year-over-year increase in gross margin. Our US IT business had a tough quarter with gross margin down 19%, due mainly to the implementation of tenure rules at one of our largest clients.

Adjusted EBITDA was $1.4 million lower than last year, due to the weaker IT results and higher costs. Asia-Pacific had a strong fourth quarter with year-over-year growth in revenue and gross margin, up 13% and 21%, respectively, in constant currency. Gross margin improvement was driven by growth in permanent recruitment and RPO, primarily in Australia and China.

Adjusted EBITDA in Q4 was $1.5 million better than last year, due to better gross margin mix and cost savings. In the fourth quarter, Australia gross margin grew 16%, led by strong perm results. China gross margin grew 52%, led by perm and RPO. Recent public data from our competitors in this market show we are continuing to regain market share in this important region.

In Europe, Q4 results were mixed with gross margin dropping 5%. Adjusted EBITDA was $1 million better in constant currency due to cost savings in real estate and other G&A costs.

UK revenue was 7% below last year, while gross margin fell 11% due to weaker results in RPO and recruitment. RPO gross margin fell 31% year-over-year as we saw lower volume at one client compared to a very strong finish last year. Year-over-year recruitment gross margin fell 5% in a growing market.

I will speak more about the UK later, but we know we need to improve our response to shifting client behavior, particularly in the financial services sector.

Our second-largest market in Europe, which is Belgium, grew gross margin 10% in constant currency on strong growth in permanent recruitment and talent management. In Continental Europe overall gross margin was up 1% in constant currency; a softer demand in France and Netherlands offset Belgium's growth.

Turning to the full-year results. 2014 full-year revenue was $581 million, up 4% from 2013 in constant currency. RPO grew 59%. Permanent recruitment and talent management were both up 14%, while our temp contracting business fell 8%.

Gross margin was $223 million, up 7% from last year. RPO and permanent recruitment both grew 14%. Talent management is up 12%, while temp contracting fell 8%.

SG&A costs were $230 million, 4% higher than last year, driven by the higher fee earner compensation costs plus the proxy Alix costs, offset by lower support, real estate, and other G&A. Adjusted EBITDA was a loss of $7.5 million, an improvement of $7 million from 2013.

In the regions, Americas revenue fell 3% as a 51% growth in RPO was offset by 14% lower temp contracting. Gross margin grew 11% with RPO growth of 47%, more than offsetting weaker recruitment results. Full-year adjusted EBITDA was $1.4 million positive compared to $2.3 million last year, with improving profitability in RPO offset by weaker IT results and higher relative costs, what is now a smaller business.

Asia-Pac revenue and gross margin grew 11% full year, while strong growth in RPO, talent management, and perm recruitment was somewhat offset by lower temp contracting. Full-year adjusted EBITDA was $1.9 million, a $3.4 million improvement from last year.

In Europe, full-year UK revenue fell 4% with growth in perm being offset by lower temp contracting. Full-year gross margin was up 1% and the perm growth of 19% was offset by weak results in RPO and temp contracting. Continental Europe's revenue grew 6% in constant currency with growth in perm and talent management. Gross margin was up 5%. Europe's adjusted EBITDA grew by $5 million year-over-year, driven by Belgium and France.

Here are some additional data points on the fourth quarter. We incurred $1.8 million in restructuring charges in continuing operations, mostly severance costs in Europe and our corporate center. Q4 results included $400,000 of stock compensation compared to $100,000 a year ago. For the year, stock-based comp was $1.3 million versus $2.1 million in 2013.

Our Q4 tax revision was a net $200,000 credit when you add the continuing and discontinued operations pieces, which compares to a $3.8 million expense a year ago that is related to a valuation reserve in Australia. We ended the quarter with $34 million in cash and $24 million in available borrowings, totaling $58 million in liquidity. We have no credit facility borrowing at quarter end, paying down $8 million in the quarter.

DSO at quarter end was 43 days, down from 45 days in September and down from 44 days a year ago. Capital expenditure for the year was $5.3 million, which included $2.1 million relating to landlord-funded leasehold improvements. Looking to 2015, we expect approximately $3 million to $4 million of capital expenditures this year.

Looking to Q1, we expect our international business will be impacted by weaker currency trends. At prevailing exchange rates, we expect a revenue range of between $115 million and $125 million. Our guidance assumes an average exchange rate of $152 to sterling, $113 to the euro and $0.78 to the Australian dollar.

Reported Q1 2014 revenue was $144 million, which translates to $129 million at our estimated rate for Q1 2015. So our revenue outlook is down 3% to 11% from prior year in constant currency, mainly impacted by the softer temp contracting in the UK. Our outlook for gross margin is approximately flat to slightly down compared to prior year on a constant currency basis.

Recently we expect Asia-Pacific revenue and adjusted EBITDA will grow year-over-year in constant currency. Americas revenue will be lower than last year due to lower trading in our IT business, somewhat offset by continued growth in RPO. Gross margins should be ahead of last year due to the mix of higher-margin RPO business. Adjusted EBITDA will be below 2014 due to lower client activity in the IT business.

In revenue -- in Europe, revenue and adjusted EBITDA will lag the prior year. UK had a very strong first half in 2014, but has weakened in recent months. After a disappointing finish in the fourth quarter, our recruitment business has started slowly in 2015.

Manolo and I are actively engaged with Alexis de Bretteville and the UK management team on implementing the investments and disciplined execution needed to get our UK business back on track to profitable growth. I am happy to report that we recently won two new RPO deals in the UK.

The rest of Europe is expected to be flat to slightly down compared to Q1 2014 in constant currency, as weaker conditions in France should be offset by continued good performances in Belgium and Spain. Overall for Q1 we expect an adjusted EBITDA loss of between $2 million and $4 million, which compares to a $2 million loss in Q1 2014.

Despite our Q1 outlook, we are committed to achieving positive adjusted EBITDA in 2015 and believe the traction we have shown in 2014 across our business and in our core markets provides a roadmap to achieve this important goal.

Maria, please open the line for Q&A.

(Operator Instructions) Bill Nasgovitz, Heartland Funds.

Yes, good morning. So did I hear correctly that for the year you expect slightly down revenue and perhaps just barely positive adjusted EBITDA for the year?

We didn't give any guidance on revenue but, yes, you hear correctly. We expect positive adjusted EBITDA for the year.

And what is your expectation in terms of revenue?

We've not made any remark about revenue at this moment. As you know, we do quarterly guidance and we have -- we are not at this moment going to give any guidance on the annual revenue.

Can you repeat the NOL? What was that amount?

$300 million in the US.

Phenomenal number.

Yes.

Thank you.

(Operator Instructions) I'm showing no further questions at this time. I will now turn the floor back -- I'm sorry, we do have a question from David Sachs, Hocky Capital.

Good morning. Could you address the benefit in Q4 and perhaps in Q1 of any of the savings from the AlixPartners cost savings measures? Have we started to see the benefits of that at this point or in Q1?

David, it's Stephen. We are seeing some benefits, especially in Asia-Pac I would say, where some of the actions we took occurred probably more Q3 and early Q4. Some of the actions in Europe dragged a bit; part of it is just the way the market has worked there.

So we saw probably $1 million to $2 million in Q4 I would say, and as we have now taken some actions as you know at the end of the year, we expect that number to increase in Q1, particularly as some of the corporate savings come through.

You mentioned in the script that you had added, in terms of consulting overhead, was it $10.4 million?

Yes.

So can you explain; is that incremental salaries from the addition of new hires? And then what the timeline is for productivity from those people and how should we determine whether that has been a successful investment or not?

Most of the investment has been in Asia-Pacific and started probably really ramping up in Q2 last year. That is the kind of change year-over-year of that line that we capture our fee earner -- our compensation costs. Part of it would be just higher base costs and also higher -- and variable comps tied to growing the gross margin.

When you look at the Asia-Pacific growth I think in the fourth quarter you start to see now some of that is obviously attributed to having more feet on the street, more scale, more focus. So I think it is probably six-ish months, six to nine months maybe before we start to see goodness. It depends on what the hiring profile is, but I think we are comfortable.

I think we now have some work to do in the UK, and it probably won't be to the same extent as in Asia-Pac, but we do need to do some work there along similar lines.

Okay. Manolo in his comments mentioned that the Company's path -- we had a clear path to reach our peers in 2016 in terms of adjusted EBITDA margin. Who are our peers, if there are such a thing, and what are we talking about in terms of a range of margins?

The companies that we look at Robert Walters, Hayes, and Michael Page, of those companies the one that has more similar scale that we do is Robert Walters. And when we say the range of our peers rather than give a number is because we don't know what the year might be. If it's a great year and the economy recovers in Europe, we will have an upward cycle. We would looking forward to benefit from that as well as they would and if it's not we will stay more on their current trading. I think the last time we saw a Robert Walters [stipend] was approximately 6% to 8%.

Mid single digit.

Yes, I'm sorry; mid-single digits.

Okay. So we would be going from essentially a breakeven run rate as we exit 2015 to a goal of achieving something between 6% and 8% in -- that would be a 2016 exit rate, if the world holds together as you see it today?

As we see it today, yes.

And to get there we need revenue growth or is this coming from additional expense savings identified?

It's coming from those three things that I said before in my script is additional growth is the --. And it's also the fact that we will be continuing to bring sharp focus to our portfolio. It's those three actions.

I guess we are going to benefit as well from the mix change. You've got RPO and talent management, which is higher gross margin businesses growing.

Can you give us some sense of the size today of the RPO business in revenue, gross margin; what you (technical difficulty) breakout? And what kind of contribution margin that business had in 2014. A sense of the backlog in the business and some reasons why we should be optimistic that that has some further growth potential.

So in 2014 the revenue of our RPO business was $[90] million. The gross margin was $40 million and that is 16% of our global revenue and 18% of our global gross margin. We --.

On slide 12, David, you actually have the breakout of our services split. Talent management was about $40 million in revenue last year and $36 million in gross margin, give or take. So I think you're right; the mix will definitely help as we go forward with our -- with the areas that we are focusing on.

And the RPO business for sure we continue to win deals. Sometimes they are a bit slower from the win to when they turn into revenue than we would like, but we are continuing to win new business in Asia Pac. As I said, we just are getting ourselves back on track now in the UK after some customer losses last year. And US we have invested fairly substantially in RPO now to drive the business there, and again you've seen some of the very, very strong growth.

Obviously some of the rates may mitigate as you lag comparable history, but that's where for sure that $90 million we are focused on growing. Again, the issue there can be as well the mix, as you said, where sometimes there is more of a hybrid deal versus the pure program fees, which kind of impact the gross margin percent.

We are rated on the market analysis, so both the NelsonHall report as well as the [Bakers Dobson] report. The [Bakers Dobson] is choosing the 13 companies that they rate higher, so we are -- and that is a global report so we are among the best 13 companies globally. NelsonHall is also betting highly on Hudson with great rates, mainly because of the client satisfaction that they have received from our clients in different interviews, as well as our capabilities for service delivery.

The market research are quoting an average growth of the RPO market of around 15%. It varies region by region, but that might be a good average. It's a very interesting market with growth, per se, to be in and in a leadership position there.

Difficult to say the profitability of the RPO business standalone. We don't disclose that. Obviously, it would depend on our allocation methodology. The only way to really look at that would be to see what is the direct profitability of the business, and we don't disclose that because that is part of our competitive data that we don't want to make it public.

Okay. And then in terms of the business is as lumpy as you mentioned, do we have any perspective on the growth in your RPO business based on contracts? One, your estimation of when those contracts will start generating revenue for you, and the duration of the existing contracts.

How should we think about 2015 or 2016? Is that a business that you think grows clinically in line with the market at 15%, or just based on your wins and lumpiness it's going to be more or less by some degree?

It's hard to say, David. I think for sure we would expect to stay up with the market. As I said, we've had some good wins recently that are not yet showing up in revenue, but will; hopefully in the second quarter. And I think the expectation is with our focus and our, particularly in certain regions our strength there are that we would be probably beating the market.

But overall I think I would say, yes, we should be -- we should absolutely be in line with -- if that 15% is the right number, and who knows, that would be our expectation.

I think on average, and I will qualify the average, because this is a lumpy business. It is -- you get contracts which bring volume and you might get 54% growth in a quarter and then the following quarter you might be flat because of the lumpiness of the business.

So on average, I endorse fully, Stephen, what we will be on the market or above the market, but you might expect some lumpiness quarter over quarter, especially when you have seen high growth in the previous quarters.

And when you talk about wins or a good win, can you quantify what a particular win -- you don't have to mention the client, but just approximately is a win $1 million in revenue a year? Is a win $2 million, $3 million?

Yes, it's somewhere between $0.5 million and $1 million, that's a good win.

And that is per year. What is the typical duration of a contract? So if you just announced one (multiple speakers)?

Three years.

Three-year engagement?

Yes. There are three types of RPO engagements. There is this long-term engagement, whether it's a full outplacement of the recruitment function. There is -- there are project engagements, too, where what you are doing is supplementing the capacity of a client on a peak for a specific project, which then it does -- the length of the project is the length of the contract.

And then sometimes there are specific demands on a functional support, which is less so. But we are more concentrating on the three-year contract and projects; those are the two areas where we are mostly positioned.

And if we win RPO business, does that drive any other silos in the Company? Does that generate revenue incrementally outside of that contract, whether it's within your TM component or in permanent or temp? Is that helping other parts of the Company or is it really a standalone segment?

No, we operate the three business units: recruitment, talent management, and RPO. They have strong bridges that create synergies among the three of them. The recruitment business is the one that present in 18 countries give us lot of [capillarity] in terms of market presence.

So many of the leads that go to RPO are coming from the recruitment business. The flow of business is -- leads generated by recruitment go to RPO in many instances.

Talent management complements RPO by offering some assessment tools that allows our RPO consultants to offer additional added value to our clients. And that creates more of a partnership with our clients where you will just not sourcing candidates for them, but in that partnership with our talent management tools getting more in-depth into that recruitment and assessment process.

Sometimes there is an overflow of requirements in RPO clients that cannot be satisfied, either because they are very specific or just because of capabilities. And those are then outsourced from RPO into our agency recruitment business.

And if I look at your RPO business and then the components of talent management and recruitment that you say are essentially tied to that sale, how big is that cluster as a percentage of all of Hudson? So I've got $70 million of revenue, $40 million in gross margin from RPO. How much would you guesstimate of talent management and recruitment lines up with that cross-selling, that synergistic combination?

It's hard to say, David. It's not -- I wouldn't say it's a hugely material number, I'll be honest. It could be more, but it's not a --. We don't have the data, but my gut tells me it's not a material additional impact.

Okay, and then just humor me for one second. You had mentioned earlier that we had about $1 a share of cash. So we are looking at the stock today trading at $2.65. I think anybody that owns this is now paying $1.65 times 33 million shares for Hudson Global, which is next to no money.

And routinely RPO businesses, when they have traded, have traded for between 2 and 3 times gross margin. So that is at $80 million to $120 million business value for that small part of your company. Suggesting that Wall Streets valuing all of Hudson at a significant negative value.

I recognize you are taking steps here to remove costs and improve the profitability of the underlying business, but what are investors missing in that they are not understanding? Is it the value of the RPO, or they don't see the potential for you to accomplish this restructuring savings and get to this 6% or 8% margin on your own?

We have had some sequential improvement modestly in 2014, so thank you for that, and the cost savings, we seem like we're going to the bulk of those coming in 2015. And you are still tweaking your portfolio. You removed Sweden. You've sold eDiscovery. Would you say we are basically done on the pruning of the portfolio, or is there still loss-making European components of the Company that you think don't fit here going forward and may be pared off?

David, I think we are very transparent on all we have said. And the Company is growing in most of the markets, so we have defined our portfolio. One side is RPO and talent management, high-valued businesses where we are growing 14% 12%, respectively. 40%, which is a big chunk as well in our portfolio, is permanent recruitment, where we have also grown 14% last year. And we are only dealing with the 25% of temporary recruitment, which we are dealing with and it's taking more time to mend. But that was the only one that decreased 8%.

Then you have seen the improvement that we have made on the EBITDA from last year. And as you pointed out before, the AlixPartners engagement with their recommendations has started to be implemented in 2014, but most of the savings are going to fall on 2015. And, furthermore, we are disclosing that we have invested in talent in our front office, which, because of their longer tenure and productivity, will have also better impact in 2015.

We are optimistic about generating value. We are explaining that both in our remarks and in our press releases, and it's up to the market to draw their conclusions. The only thing we can do is continue working very hard creating value in the Company, investing in the areas that show more profitable growth. And we believe that doing that, the market would end up recognizing the real value of the Company.

And a sense of what has happened or what is the current trading, with the available information, the only thing we know is that we have only spotted one large client that has decided to exit Hudson. The moment that that happens, even if the rest of the market is happy, because of the narrow trading of our stock, has a big impact.

I cannot comment on what really happened. That is kind of like my own personal understanding.

And given your liquidity position, $34 million in cash, no debt, and a prospect for becoming EBITDA positive with a lot of conviction, as you said earlier in the call, have you contemplated share repurchase as a means of returning some of that cash to investors and then capitalizing on what seems like a very large discount to the value of your business?

We continue look at and contemplate all possible options that would be in the best interests of our shareholders. And if returns from investing in the Company are not expected to deliver more returns, we will absolutely consider other options like the ones you've just mentioned.

Okay, thank you very much for your time. I had one last question.

Just in terms of -- going back to the concept of your portfolio, do we feel at this point we are strategically complete with the moves you have made by reducing your exposure in Sweden in eliminating eDiscovery? Or are there options in Europe or elsewhere where you can remove a business that's structurally or strategically less important to you?

Well, I think we've been very clear on the strategy and we will not disclose the individual tactics.

Okay, thank you very much. Hopefully 2015 works out a lot better for your investors and for the Company. Good luck.

(Operator Instructions) I'm showing no further questions at this time. I will now turn the floor back over to management for any additional or closing remarks.

Thank you, Maria, and thank you all for joining Hudson Global's fourth-quarter conference call. Our call today has been recorded and will be available on the investors section of our website, Hudson.com, shortly. Thank you. Have a great day.

Thank you. This concludes today's call. You may now disconnect and have a wonderful day.