Stacey Burke - Vice President of Corporate Communications Steven C. Cooper - President and Chief Executive Officer Derrek Gafford - Executive Vice President and Chief Financial Officer

Paul Ginocchio - Deutsche Bank Michelle Morin - Merrill Lynch James Janesky - Stifel Nicolaus & Company, Inc. T.C.

Robillard - Banc of America Securities Mark Marcon - Robert W. Baird & Co., Inc.

Ty Govatos - CL King Jeffrey Silber - BMO Capital Markets

Thank you. Here with me today is TrueBlue’s CEO and President, Steve Cooper, and CFO Derrek Gafford.

They will be discussing TrueBlue’s 2008 fourth quarter earnings results which were announced after market closed today. Please note that our press release and the accompanying income statement, balance sheet, cash flow statement, and financial assumptions are now available on our website at www.TrueBlueInc.com.

Before I hand you over to Steve I ask for your attention as I read the following Safe Harbor. Please note that on this conference call management will reiterate forward looking statements contained in today’s press release.

And may make or refer to additional forward looking statements relating to the company’s financial results and operations in the future. Although we believe the expectations reflected in these statements are reasonable, actual results may be materially different.

Additional information concerning factors which could cause results to differ materially is contained in the press release and in the company’s filings with the Securities and Exchange Commission including our most recent forms 10-Q and 10-K. I will now hand this call over to Steve Cooper.

Thank you, Stacey. And thank you for joining us today to discuss our fourth quarter results for 2008 and what our outlook is as we move in to 2009.

Earlier today, we reported a net loss of $46 million compared to net income of $ 14 million a year earlier. Included in our results this quarter was a goodwill and intangible asset impairment charge of $49 million net of tax.

This impairment is related to a decline in the estimated cash flows from the acquisitions that we have completed over the past five years as we developed our niched approach to serving the blue collar labor markets. Although the current cash flows have declined in this difficult economy, we remain positive about the side brands we are operating and our approach to serving our customers in these markets.

Excluding this impairment charge, net income would have been $3 million or $0.08 per share. We have previously expected net income per share to be in the range of $0.10 to $0.14.

Excluding this impairment charge, our results in net income were close to our expectations given a very challenging operating environment during the fourth quarter. Our results during the quarter were impacted significantly by organic revenue declines of 28% which were about ten points worse than we had anticipated at the beginning of the quarter.

Although we had seen our revenue trends declining throughout 2008, our trends worsened as we approached the holidays as many clients shut down their facilities for extended periods of time, and many shut down before thanksgiving and did not start back up until after the first of the year. We also saw consumer confidence erode, which had a large impact on our retail clients along with our distribution, transportation and manufacturing clients.

In addition, residential housing worsened slightly even from the declines we had already experienced. As we moved through January in 2009, we saw things stabilize a bit.

However, this still leaves us with steep organic revenue declines compared to prior year. This decline we are experiencing is broad based across most industries served and all geographies that we operate in.

The decline in organic revenue has resulted in significant deleveraging as the fourth quarter net income without impairment charge declined 72 %. The deleveraging was only about a 3:1 meaning, we experienced 3 points of net income decline for each point of decline in organic revenue.

Although we are not pleased with the top line results, we are pleased with the ability to hold the deleveraging to these levels. We produced these results by responding quickly with several cost cutting actions, to help offset the declines in organic revenue.

And most importantly, to ensure we are prepared to experience the positive leverage that comes quickly as these trends do turn around. The most significant actions taken during the quarter included closing seventy additional branches, bringing our total closures for the year to 102 branches.

Included in the 70 closed branches in the fourth quarter, is the disposition of all 29 of our United Kingdom branches. After struggling for several years in the United Kingdom to bring our operations there to profitability, we were able to transfer the UK business to a new owner which will eliminate further operating loss in the UK.

Acquisitions completed during the last 12 months contributed to a 13% increase in our revenue during the quarter. During the fourth quarter, we also completed merging our new PMI branches acquired in April 2008 into our Spartan brand.

The merger will enable these branches to operate more efficiently during 2009 and provide a significant growth opportunity for us when economic conditions improve as we believe expanding this brand from our current branch count of 64 in seven states will be one of our greatest opportunities for a nationwide expansion. As we begin 2009, we are continuing to approach controlling our cost structure much like we have done during 2008.

Each month as we continue to analyze our trends and results, we will stay diligent in making the appropriate changes to our cost structure by closing under performing branches and scaling management and support cost to match the demand for our services. We do this to ensure we stay financially strong and to help us be prepared to grow our brands when the economic conditions turn.

Our sales and service teams are extremely focused on serving our current customers to help them balance their own cost structures and we have proven to be great business partners for them during this time. We have assembled a team that is tracking the projects that will be included in the economic stimulus plan being developed under President Obama’s leadership.

We will be ready to provide labor quickly for each project at the general contractor or subcontractor level. We believe this plan will provide several opportunities for our customers to ramp up their businesses quickly.

And as in the past, we will be there to support each of our customers as they ramp up these projects. As part of our strategy to grow revenue and income, we have broadened our niched approach to serving the blue collar labor markets.

We are now operating 5 brands as follows: Labor Ready serving the general needs across most industries with staffing on demand out of 697 offices; Spartan Staffing serving a longer term staffing need and onsite management of labor in the light manufacturing and distribution markets with 64 offices; CLP Resources serving the skills construction trade with 77 offices; TLC serving the transportation market with experienced truck drivers through 10 offices; Plane Techs serving the aviation maintenance and manufacturing markets with experienced aviation mechanics on a nationwide basis through one central office. We believe our niched approach to branding and going to market has set us aside as the leading provider for blue collar staffing.

While the conditions are difficult in most of the niches we currently serve, we remain extremely positive about the long term opportunities available to us and our ability to better serve the markets and customers we have identified. We also have several new brands that I have mentioned here.

And each have the ability to be expanded nationwide once we work through the downside of this economic cycle. We believe our competitors and each of these niches are struggling to keep their financial position strong.

We have a strong financial position and that will enable us to grow each of these businesses once the economy settles and we look forward to the opportunity to participate in industry consolidation as smaller competitors struggle through this economic cycle. At this time, I am going to turn this call over to CFO Derrek Gafford for further details on our operating and financial trends and then we will open up the call for any questions you may have.

Derrek Gafford Thanks Steven, Good Afternoon. Let me start off by giving some background on the impairment charge.

As a part of our annual review of goodwill and intangible assets, we booked an impairment charge of $61 million which has an associated tax benefit of $11.7 million. This charge is related to our acquisition, investments and CLP resources which includes the SSC acquisition, Spartan Staffing which includes the PMI acquisition, and to a lesser extent TLC.

The primary factor impacting these valuations is the expectation of lower future cash flows resulting from rapid contractions to our current and expected revenues from the current recession. Now let us turn to the revenue trends for the quarter where I will add some follow up commentary to Steve’s overview.

The most significant trend this quarter was the deceleration we experienced in our monthly year over year same brand revenue trends. The negative same store revenue trend dropped from 20% in October to nearly 30% in December.

This decline was not isolated to a particular brand, market or geographic area. Our same brands revenue trend in January this year was consistent with December which we have incorporated into our Q1 2009 revenue expectation.

For the first quarter 0f 2009, we expect revenue in the range of $220 to $230 million. This represents growth from acquisitions completed within the last twelve months at 5% and a decline in organic revenue of about 35% resulting in a decrease in total revenue for Q1 this year of about 30% compared to the same quarter last year.

We expect net loss per diluted share for Q1 2009 to be $0.15 - $0.20. Keep in mind that seasonally, the first quarter is our slowest revenue quarter producing a little over 20% of our total annual revenue for the year, whereas our third quarter produces nearly 30% of our annual revenue.

Now let us discuss the trends and gross margin. Our gross margin for the quarter was 29.3%, about 30 basis points higher than our expectation due to workers compensation expense being slightly lower than expected.

I want to take a moment now to discuss our overall expectations for gross margin for 2009. Today in our 8-K, we provided a variety of assumptions which included our gross margin estimate for 2009 of 28.5% – 29%.

This is a reduction of about a hundred basis points compared to 2008. Half of this reduction is related to the blending impact of acquisitions made in 2008 that have not hit their one year anniversary.

The other half is related to our expectation of continued pricing pressure as the staffing market continues to contract. Our estimate for gross margin for Q1 of 2009 is about 28% - 28.5%.

Sales, general and administrative expense as a percentage of revenue was 26.1% to this quarter, which was above our expectation of 25% primarily due to a lower organic revenue base spread our fixed cost across. I like to give these two points now that should be helpful in understanding our SG&A trends in 2008.

Included in our SG&A during 2008 was $20 million of expense from acquisitions that had not yet annualized. Excluding this expense, 2008 SG&A declined by nearly $25 million compared to 2007.

Included in our SG&A for Q4, was $6 million of expense from acquisitions. Excluding acquisitions, Q4 SG&A declined by $14.5 million.

These cost reductions were largely driven by branch closures, reductions in field management cost and reductions to a variety of program and support cost. To provide some perspective on these cost reductions, let me recount a couple of statistics that are key drivers of our cost structure.

During 2008, we reduced our branch count by about one hundred locations which represents a little over 10% for 2007 ending branch count. Excluding the impact of acquisitions, total employee count was reduced by 20% in 2008 compared to our employee count at the end of 2007.

We often get asked the question, “When do you stop cutting expenses?” The bottom-line is the economy is getting smaller, our customers are getting smaller, and we too must continue to adapt and get smaller before we can grow.

Until we see sustained improvement in organic revenue trends, we will stay in an aggressive cost management state. In regards to our expectation for the first quarter of 2009, we expect SG&A to be about 31% - 32% of revenue based on the revenue estimate provided today.

Net interest income was about $1.8 million lower than the same quarter last year due to lower yields on invested cash. Depreciation and amortization was $1.3 million higher compared to Q4 last year due to the amortization of acquisition, related and tangible assets and additional depreciation related to new information systems.

Our income tax rate for the quarter was a benefit of 16.8% which is abnormally low from a historical perspective due to the proportionately low amount of tax benefit related to the impairment charge recorded this quarter. Excluding the impairment charge, our income tax rate for the quarter would have been about 41.2% which is higher than our expectation of 38% due to certain true up adjustments for prior year tax returns made this quarter.

We expect our Q1 2009 tax rate to be about 38%. Let me touch on cash flows for a moment.

Cash flow from operations for 2008 was $92 million which help bring our total cash balance to $108 million. Cash flow from operations was heavily driven by the deleveraging of our accounts receivable associated with the organic revenue decline.

In light of the overall uncertainty in the economy and credit markets, I would like to provide some clarity regarding our liquidity. We have $26 million of borrowing availability on our $80 million credit facility.

The existing borrowing is solely comprised of letters of credit. The main covenant on our facility is the debt to EBITA ratio of 2.5.

Our actual ratio on this covenant is .6. I think it is also important to point out our approach in collateralizing our workers’ compensation program.

While many companies collateralize their work comp liabilities exclusively with letters of credit, we have set aside nearly two thirds of our deductible work comp liability in restricted cash. Thus the majority of our work comp payments are made from this restricted cash versus cash from operations.

In addition to helping preserve cash flow from operations, this approach helps maintain borrowing availability by minimizing outstanding letters of credit. In regards to capital expenditures, we expect CapEx of about $5 - $6 million for Q1 and about $14 million for all of 2009.

That is it for prepared remarks. We will now open the call for questions.

Hi Derrek and Steve. A couple of questions first, expectations for the first quarter Derrek, you would expect a 38% income tax benefit in the first quarter?

That is right.

Okay. And then, the June and September quarters obviously progressively get better historically.

Would you expect that you could return to positive cash flow and positive earnings per share in the June and September quarters?

Well, let me make a couple of comments on that. One, the comps do get easier as we get into the back half of the year and that was actually the case during the back half of 08 as well compared to 07.

So assuming there is no additional contractions in the economy, but there certainly has been a pattern of that over the last four quarters, what would drive us to positive cash flow and some positive earnings is the seasonality perspective particularly that I mentioned related to third quarter where nearly 30% of our revenue for the year comes out of the third quarter. So it is important to note when looking at the loss that we are forecasting for Q1 that it is our lowest revenue base for the year.

There is less revenue to spread the fixed cost across.

Okay. And when you gave the assumptions for 2009 in the 8-K, you have the reduction in SG&A from branch closures and incremental SG&A from 2008 acquisitions, that nets out to be about $15 million.

I would imagine there are other costs, the cost cuts that you put in place means that SG&A in an absolute dollar basis will be down much more than that from 08 to 09. Is that a correct way to look at things here?

I think so. I mean we have given you the broad brush strokes in the 2009 assumptions, that are going to get you most of the way there, meaning that we have said that related to branch closures that we did in 2008, there is $20 million of less SG&A that will be present in 09 for those 08 cost reductions from branch closures.

There is another $5 million from acquisitions so now we are at a net $15 million reduction. You will also see that we have put in on average what are variable SG&A associated with same branch revenue.

So the degree to which same branch revenue is down, multiplying it by 6% that will also give you cost reductions just related to variable expenses in the branch that come down as the same branch revenue comes down. The two other things that there will be cost reductions in place are we closed nearly a hundred branches during 08 and we are not done for 2009.

We will keep closing branches when we are in this type of revenue decline so there will be more cost reductions there and overall, there is probably another $3 - $5 million of program and support cost that we have cut out that will roll through 09. So I think if you take all of those, I mean mainly the ones in the 8-K but some of my color commentary here that should be enough to get you directionally correct on SG&A.

Okay thanks. And then shifting gears just a little bit, Steve you talked about the potential for infrastructure revenue growths from infrastructure investments.

You go into a little bit more detail what types of positions you could fill and any timing component to it?

I think that is the big question out there is how fast is this going to flow and how much of it is really going to be shovel ready and how much of it is going some other direction. I think that is the debate that is taking place this week.

So I would not want to predict the timing and the full out flow of that stimulus package. What I can say is that we are tracking what is in that bill so far and what degree is coming towards general contractors that do business at the state level, the city level, the county level where we will be able to participate.

There is this big question of how much of the little and large infrastructure which might be mainly union driven. It honestly appears that is going to smaller levels than that and that we will have the opportunity to participate quite a bit.

The type of work that we do in skilled positions really can do anything in contracting whether it be carpentry, smith work, steelwork and such. So I think we will be able to participate quite a bit in the smaller projects that are going to take place in the local bases.

Again now the big picture is how much and how fast the stimulus package rolls out, we do not know.

Okay thank you.

Hi Steve and Derrek. I was wondering if you could talk a little bit about gross margin, trends and what is impacting your projection, also if you could give us some color in terms of what the pay bills spread was during the fourth quarter.

How do you see that going and what the impact was from the workers comp, a cold reversal during this past period and how you think that might unfold as we look at 09?

Sure, for 2009 in broad brush strokes we are expecting gross margin to be about a hundred basis points lower than 2008. Half of that just from the blending impact of acquisitions that we have made that have lower gross margins than our core business that have not yet anniversaried in a twelve month run rate.

The other 50 basis points is what I would refer to as more true gross margin slippage. Most of that from pricing pressure, maybe a slight dip from payroll taxes but we are not expecting anything significant this year.

The bottom line is that it continues to be a very competitive billing environment out there as staffing companies, the revenues continue to shrink and the market gets smaller. So that is about our best direction on gross margin.

More specifically to your question on workers’ comp; workers’ comp for the quarter this year, for fourth quarter of 2008 was about 3.8% and there was about a hundred basis points related to work comp reductions in that 3.8%.

And the pay bill spread that you experienced in Q4?

Pay bill, give me one second Mark. Bill rate was an increase of about 2.3% for fourth quarter compared to fourth quarter of 07.

And correspondently the pay rate increased about 3.2%.

Okay. And is there anything that is coming down the pike in terms of minimum wage increases, anything like that we should be aware of or that you have taken into account.

And to what extent can you, obviously it is a tough economy for everybody, can you reduce your pay rates or are you assuming that you are going to reduce your pay rate in order to achieve these gross margins.

Yes, as far as minimum wage increases, there is another slide of minimum wage increases for 2009. However I would say that they are as far as materiality and magnitude and impact on us, they are almost identical to 2008, maybe slightly less as far as impact.

On the pay rate side, two-thirds of our revenue in our business is out of the Labor Ready brand. There is not much opportunity to reduce pay rates there.

That has been something that we have attacked over the last couple of years in managing margins very tightly. So as minimum wage increases have gone up, most of these pay rates are right on the margin meaning they have to go up.

It has been one of the things that has been challenging for us in this competitive pricing environment as we have to pass this bill rate increases along as well. That leaves us another third of our business though, that is not on the margin, where pay rates are above the minimum wage.

That is an area for us of focus in 2009 to see if we can get some more efficiency out of that as the supply of temporary workers increases.

Mark a little color there, from the customers perspective, there are two things that all tie in to what Derrek has talked about, in the Labor Ready Division where the pay rates are pretty close to as low as they can be anyway. The amount of increase that we were able to work with our customers has been equal in about the size of the minimum wage increase.

So we have been getting the cost faster, we just have not been getting the margin on it the last year. And so that has been difficult but we continue to believe we can get back at least the cost past through in 09.

We have not seen any sign that that is not true. In this other third of our business that Derrek is talking about, we are seeing customers backing off a bit on how much control they are putting on us to control the pay rate.

In tight markets, customers usually are very concerned that our pay rates match their permanent employee base pay rates and therefore they put tight controls on staffing companies on what we are paying and what we are billing also because that is competitive pressure. We have seen a little bit of release there that companies are starting to allow us to control those pay rates a little bit more, that at the third of the business especially in the skilled positions of both aviation and our skilled trades; the contractors, the construction folks.

But even within warehouses and distribution and manufacturing, we are starting to see it a bit. So I think that is a positive sign that we can control these margins this year just on that news there.

And I will jump back in the queue but there is one more question. Are you seeing any signs of light anywhere in terms of January?

I mean I know the headlines are dire and…

Well I think the good news that I took out of January was there are a lot of plant shut downs into the holidays and we were able to jump back to those levels before the holidays. And it felt pretty good and we had two or three solid weeks of those levels.

So when we hit December, I will tell you it was concerting because you could not see the bottom that was going so fast because of those shut downs it was not immaterial what happened in December. And to see it jump back, get people back to work and some of these facilities started back up was very encouraging.

It is still very steep declines but we did see some encouragement that it was not free falling during the month of January like it was in December.

It is good to hear. Thank you.

Thanks so much. I just wanted to follow back up with the discussion regarding the Obama stimulus plan.

And again I know there is really no crystal ball out there, but it sounds like you are expecting the biggest impact to be in your Spartan brand. Is that accurate and I am just wondering if you think there might be any impact on your Labor Ready brand as well.

Thanks.

It is probably not exactly the Spartan brand that is going to fill first. It is most likely it is CLP where they are very focused on being able to mobilize skilled workers that deal with concrete, deal with carpentry, and deal with heavier infrastructure type of work.

And so we believe that brand will be able to be mobilized quicker which is good because they are in the state of California, the state of Texas, the state of Florida, those three large ones that are high on the list for getting money. Spartan would get it down the road a bit, they are heavy in producing, and well they are heavy in the state of Indiana, where heavy manufacturing of autos and machinery are so we would feel a little bit of fall out there.

But I think the Labor Ready brand in general would benefit before Spartan. Maybe not to the same degree but they would benefit faster because we have general labor is ready to go to work in every market across the United States.

So I think the fact that we are broader, we can get impacts quicker there.

I am sorry, I appreciate that clarification. I have to ask this, I do not have the press release in front of me but I have a question about the UK disposition.

Is the impact of that, had that been done in the fourth quarter, should we expect any benefit either in terms of cash inflow or any type of accounting charge again if that has not been done under the aspect.

The disposition of the UK did provide about $1 million of benefits from an expense perspective in the fourth quarter to our P&L, however I will point out that that benefit was largely washed out, we did not increase our total bad debt reserve for really all of our brands by a pretty good chunk and we had a pretty good chunk of closing costs for US locations as well. So that million dollar benefit from the UK was more than offset by additional bad debt accrual and closing costs from US locations.

It is all behind us Jeff. There is no impact in Q1; it is all in Q4 numbers.

Thanks. Just to get back to UK.

Is there a way to size the losses from the UK operations in the fourth quarter or in all of the way in or in the fourth quarter and then second just from the Q4 closures, how much of the cost in fact was in the fourth quarter? If I missed that, I apologize.

What kind of incremental benefit do you expect in the first quarter in the SG&A line from the roll off of the Q4 closures? Thanks.

On the UK losses, we had about $6 million of loss in the year as a whole. In the third quarter, we had reserved closing some branches before we entered into this agreement to sell them so some of the hit for the UK was in the third quarter.

That $6 million definitely was not a run rate. We have been on a run rate of losing about $3 million per year and then things worsened this summer so we picked up pace and we probably lost another million or so, probably $2 million, by the time we got these branches closed.

Definitely the declines had steepened and been getting larger. So we are pleased to get that transaction behind us and as we mentioned on the earlier question, it is all on the results of 08 for UK.

So there is some improvement in 09 going forward because of that. Now the other question of how much is in the closing for those seventy branches, I will let Derrek take that.

Yes, so of the seventy branches that we had closed nearly thirty of those were in the UK. We talked about that there was about a $1 million benefit overall to the P&L for that disposition.

On the flip side, we had a little over $400,000 of closing costs for US locations and then we had about another $800,000 of bad debt accrual so that is the reason I really did not mention any of these in my script because these three items that we just talked about they just pretty much all wash themselves out.

And then on the SG&A line, how much of the forty branch closures were recognized or realized in the fourth quarter and how much more left to go into first?

We are done. All of the branches that we have announced in the fourth quarter, those seventy or so locations; the expense for closing those have all been recognized.

Okay, great. And then on the SG&A savings, how much of the savings did you realize from the fourth quarter from the forty closures?

Fifty percent? Or is it front end loaded in the quarter?

Back end loaded? Thank you.

It was very back end loaded. We disposed of the UK about a week and a half into December.

A significant amount of our US closings were done also in December so I think the best thing you can do here is go to our 8-K that gives you the estimate for SG&A reductions related to 2008 closures and that will help you with your modelling.

Thank you.

If the acquisitions are only supposed to contribute about 1% to revenue growth in 2009, is that all going to be in the first quarter?

For the most part, we have one TLC our truck driver division anniversary is at the end of February so that is all Q1. And then the PMI branches which are about forty branches of our Spartan division, they anniversary at the end of May.

And it sounds like maybe PMI really slowed down a bit with the plant shut downs.

Yes, the fourth quarter was tough on the state of Indiana and then the others; we have two large states that we serve in our Spartan division. One is Indiana, that is primarily the PMI branches and then Florida which is primarily the Spartan branches and I cannot imagine two worst states to be in.

So, yes that division really suffered in the fourth quarter, definitely December in particular.

It does not sound like you are expecting that much out of them in the first quarter either though.

Yes, it is not ramping quickly in those two states. We are being pretty cautious, we hope that it provides a little more upside than we put in our forecast that you have pointed out but it does not appear that the state of Indiana or the state of Florida had anything any bounce fast in them.

As we look out a little bit, it comes to become a little bit easier as we start getting out to the second and third quarter. Are you assuming that maybe we have had a little bit of stability?

I guess it is very difficult to say but as you are planning things at this point and thinking about what you do on the expense side, is that how you are approaching things at this point? In other words, let us take what we have seen over the last few weeks in January and then use our traditional seasonal build from that point.

That is pretty close right there and although we had seen declines starting in August and September in a pretty steep nature, they got really large in the fourth quarter and December. So if we say that January found stability, that is based on pre-holidays, so the holidays even got worst than these trends so we are pleased that it bounced back a bit.

But it did not bounce back very far and so we have to take what we have seen the last four weeks and cautiously forecast from there. And it is one of the reasons that we have not stepped out there with the annual guidance, so most of you would notice even are not given quarterly guidance but we feel comfortable that we are far enough into the quarter and that things stabilized enough we can give you what we see for the quarter.

Where we go back after the year is still a really wide open estimate right now Mark and I think that you are going to be able to pick a back half revenue target as easy as we are so we are just going to give you the cost estimate here and we will go to work and drive that thing up as fast as we can. But the fourth quarter is still a big chunk for us to roll into our seasonal and our annual numbers.

On the bad debt side, you made some comments there, I now you took up your reserve, how stressed are some of your clients at this point?

Well, if you take a look at our Days Sales Outstanding, using traditional methods, it is misrepresented because it will actually look like Days Sales Outstanding improved significantly for the fourth quarter. And it is because of the deceleration and the monthly comps.

Understood.

The bottom line is when you normalize for all of that in acquisitions DSO picked up by about day. So we have not seen an increase in payment defaults, we have seen just a slight aging in the portfolio so we are just being cautious both on the accrual for that and picking up the aggressiveness of our collections activities.

And what do you see in terms of your worker experience just in terms of accidents and things of that nature.

It was a pretty good year for us, overall accident trends dropped by about 5% this year compared to 2007.

Did those trends stay positive as it became apparent that things were getting worse economically?

Yes they did. It is hard to isolate because we have got a lot of brands and a lot of geographic coverage.

It is hard to tell how much the economy is impacting accident trends and how much it is in our own efforts and turnover in our branches and all those things but we have not seen a significant change in the direction of the trend.

And then what about your competitors in terms of the moms and pops, I mean they must be very stressed at this point. Are you seeing pockets where the competitive natures have eased at all?

Or is it still too early in this downturn to see that?

You know it is interesting. There has been quite a dynamic shift with small and large business.

A lot of small customers have just stopped using us and the balance of our work; let us call it our mix business between small and large customers as leaning large to larger customers. Obviously meaning that they were better capitalized, they were able to deal with this better.

Well, the smaller competitors deal with the smaller customers so they are even getting hurt worse. Then the larger customers are using this next phase of economic conditions; once they are done with lay offs, the next place they go is price and so the larger the customer we have, the more we are starting to fill there are RFPs out there, there is a little pricing pressure and such.

But your question is how are small competitors doing? And the answer is not well.

And we have had many, many inquiries to how we could do a partnership, either take over a customer list or buy them. Things have declined so rapidly, we have been very cautious the last 60 days to not jump into anything that we do not understand fully but I believe the next 6 months is going to wash some of that out.

We are going to get a better understanding of what some of those partnerships or total purchase of customer list or just taking over the business on an earn out would be our best avenue out. I think they are going to increase those opportunities, it was not going to get too much blue sky in that area, but we are excited about some programs that we have, some reach out programs and some activity that is brewing there.

I really need another 3 or 6 months to see some things fully settle so we know what we are stepping into. Directionally, you are right on point that moms and pops are suffering more than the larger staffing companies.

Great. Thanks a lot Steve.

Thanks so much. Just a couple of quick numbers questions.

Derrek I think you mentioned the monthly trends. I think you only gave October and December.

Can we get November?

Yes, I am going to round here Jeff. You can get them in detail, they are listed in the 8-K.

Oh I am sorry. I will just take a look then.

How about the share trend guidance for the current quarter?

Yes, we have not listed it but I am not expecting it to change much from where we ended at least from a diluted perspective. I am not expecting it to change materially from Q4.

Steven C. Cooper Our guidance for the year as a whole in our 8-K at $43 million and we ended the year just right around there so the first quarter will be pretty closely the same.

Okay great. And just one other trend related question.

I am just wondering if you can talk about trends from a state perspective either in terms of pseudo rates or press comp rates, are you seeing any pressure there at all?

No, not any pressure there from a work comp perspective, I am not seeing anything significant from a pseudo perspective. From a pseudo perspective, those rates generally have a pretty good tail to them.

So the economy goes through its contractions and the states have to asses where they are on their funds and then things can change. So we might see some more of that in 2010, but at this point, we are not expecting anything significant for 2009.

Great. Thanks so much.

Thanks. It may be a little bit early to ask this question but where do you find the managers when you start to reopen offices.

Just where are you keeping tabs on the managers who are departing or are you trying to shift those into other brances and just trying to understand when you do want to ramp back up. It is a hopeful question whenever that occurs but where do you get the managers when there is a ramp on.

Thank you.

Well the managers that have been dismissed from their current positions obviously we first try to move them around in the offices that are going to remain in place. So we keep the cream of the crop around.

So that is our first choice. Come re-ramp time, we will just follow the same formula that we had then and we have got great recruiting program in place where we have a data base full of those that are interested and our method is plan and attack there.

It is not heavily on our mind right now, because we have a lot in 09 to work through and by the time we hit expansion let us say at the soonest, we might but see how 09 progresses, we might be looking to get into selective markets in 2010 or by the second half of 2010, something like that. That is so far away to keep in a list of those dismissed is probably not very optimistic so we will be at ground basis.

However, not only do we have a huge supply of temporary workers ready to go to work, the economy has put a lot of good talent out there that we could put in our offices and our field management based on the data we have and the resume as we are receiving, we are not too concerned about that now. And I do not think that is going to change in the next eighteen months.

Okay. Maybe another way to ask this is of the 40 branches you closed in the US, how many of those 40 managers did you keep?

I do not have that data here in front of me.

Thanks very much.

We appreciate you being with us today and continuing interest in not only True Blue but in the staffing industry as a whole. And we will keep you updated as the year proceeds.

Thank you.