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Spherion Corporation June 7, 2005. “Safe Harbor Statement”.
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Spherion Corporation June 7, 2005 “Safe Harbor Statement” This presentation contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties. Factors that could cause future results to differ from current expectations include risks associated with the company’s, competition, changing market and economic conditions, acquisitions/divestitures, corporate strategy, currency fluctuations and additional factors discussed in this presentation and in Spherion’s filings with the Securities and Exchange Commission. The company’s actual results may differ materially from any projections contained in this presentation. Additionally, this presentation includes certain Non-GAAP financial measures. Management believes the Non-GAAP financial measures are useful in evaluating its operations but should not be considered in isolation or as an alternative to financial measures of performance as determined by generally accepted accounting principles. See April 27, 2005 Earnings Release for a reconciliation of Non-GAAP financial measures to our GAAP financial results. 2
REVENUES (in billions) $2.7 $2.2 $2.0 $1.8 $1.7 About SpherionOur foundation for growth • Diversified staffing company • 58 + years experience • 715 company owned, license & franchise locations • 5th largest in U.S. • North American Focused • $80 billion market • Top 5 competitors = 15% • 50% of market is professional • Leverageable model • Breadth of skills and services • National office network • Modern technology
About SpherionStrategic Evolution Create Value CREATE VALUE Customer Candidates Shareholders • Targeted growth • Gross profit margin expansion • Operational effectiveness • Financial discipline 1990s 2001-2004 2005+ Expand Skills Integrate & Execute Grow Earnings & Cash Flow Deliver premier recruitment- based services
Strategic InitiativesTargeted Growth & Margin Expansion • Expand relationship business • Increase mid-market penetration • Strategically manage large accounts • Expand permanent placement $2.7B $3,000 $2,500 $2.0B 60% $2,000 45% $1,500 $1,000 40% $500 55% $0 2004 2007 Large Small/Medium
Recognize my skills & attributes Fill my requirements Help me manage demand & control costs Place & prepare me for success Respect my time & Keep me informed Give me full visibility into workforce metrics Make it easy for me to work with you Provide me with quality placements Ensure appropriate governance & controls Strategic InitiativesService Offering Leadership Delivering a Competitive Advantage through Technology Investments Candidate Experience Hiring Manager Experience Client Enterprise Experience
Strategic InitiativesOperational Effectiveness • Branch Network • Fill unused capacity • More recruiters, more calls, more assignments • Optimize service mix • Perm placement and client mix • Increase candidate flow • Speed, Speed, Speed • Shared Services • Contract compliance • Customer/Candidate self-service • Best practices/SLAs
Targeted growth • Gross profit margin expansion • Operational effectiveness • Financial discipline 2005+ Grow Earnings & Cash Flow Strategic InitiativesPriorities
Teri Miller Vice President & Treasurer Financial Update
Strategic InitiativesFinancial Discipline — Goals • GrowREVENUE at or better than market • Expand GP MARGIN +50 bp per year • Reduce SG&A to 80% of gross profit • Lower DSOby 1 day per quarter + 8.2 % + 80 bp temp only Flat with prior year - 3 days
Financial UpdateBalance Sheet & Cash Flow(in millions) Goal: Reduce DSO by 1 day per qtr. Result: 1 Day of DSO = $5.6M cash 4 Days of DSO = $22.2M cash
Financial UpdateQuarterly Trend & Guidance 2005 2004 *Excludes impact of 53rd week **Adjusted EPS from cont. Ops. See reconciliation of non-GAAP measures in 4/27/05 press release
Positioned for GrowthFormula for Success • Strategy aligns most attractive part of market and our capabilities • Sales team aligned with customer needs • Delivery team aligned with candidate trends • Rewards aligned with delivering shareholder value