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ManpowerGroup Reports 1st Quarter 2012 Results

ManpowerGroup Reports 1st Quarter 2012 Results

ManpowerGroup has reported that net earnings for the three months ended March 31, 2012 were $40.2 million, or 50 cents per diluted share, compared to net earnings of $35.7 million, or 43 cents per diluted share, a year earlier. Revenues for the first quarter were $5.1 billion, similar to the prior year, up 3% in constant currency.

Net earnings in the first quarter were negatively impacted by 2 cents per diluted share, as foreign currencies were relatively weaker compared to the prior year period.

Jeffrey A. Joerres, ManpowerGroup Chairman and CEO, said, "We were able to achieve very solid profitability despite the continued headwinds of slow economic growth. Our geographic foot print, wide range of offerings and very good expense management contributed to the strong quarter. Our workforce solutions business continued to grow by solid double digits while our permanent recruitment business continues to outpace last year.

"We anticipate second quarter earnings per share will range between 68 cents to 76 cents. This includes an unfavorable impact of 4 cents per share related to currency changes in the quarter."

 

ManpowerGroup

Results of Operations

(In millions, except per share data)

Three Months Ended March 31

% Variance

Amount

Constant

2012

2011

Reported

Currency

(Unaudited)

Revenues from services (a)

$5,096.4

$5,072.4

0.5%

3.0%

Cost of services

4,249.0

4,214.8

0.8%

3.4%

Gross profit

847.4

857.6

-1.2%

1.1%

Selling and administrative expenses

753.6

772.0

-2.4%

-0.3%

Operating profit

93.8

85.6

9.5%

13.9%

Interest and other expenses

11.8

11.1

5.3%

Earnings before income taxes

82.0

74.5

10.1%

14.7%

Provision for income taxes

41.8

38.8

7.6%

Net earnings

$ 40.2

$ 35.7

12.8%

17.5%

Net earnings per share - basic

$ 0.50

$ 0.44

13.6%

Net earnings per share - diluted

$ 0.50

$ 0.43

16.3%

20.9%

Weighted average shares - basic

80.2

81.9

-2.0%

Weighted average shares - diluted

80.9

83.6

-3.3%

 

(a)

Revenues from services include fees received from our franchise offices of $5.4 million and $5.9 million for the three months ended March 31, 2012 and 2011, respectively. These fees are primarily based on revenues generated by the franchise offices, which were $253.9 million and $274.5 million for the three months ended March 31, 2012 and 2011, respectively.

ManpowerGroup

Operating Unit Results

(In millions)

Three Months Ended March 31

% Variance

Amount

Constant

2012

2011

Reported

Currency

(Unaudited)

Revenues from Services:

Americas:

United States(a)

$ 735.8

$ 750.9

-2.0%

-2.0%

Other Americas

402.5

361.8

11.3%

16.1%

1,138.3

1,112.7

2.3%

3.9%

Southern Europe:

France

1,291.8

1,353.8

-4.6%

-0.4%

Italy

267.5

284.6

-6.0%

-1.9%

Other Southern Europe

195.2

180.0

8.5%

13.7%

1,754.5

1,818.4

-3.5%

0.7%

Northern Europe

1,444.0

1,456.6

-0.9%

2.6%

APME

680.0

602.9

12.8%

9.8%

Right Management

79.6

81.8

-2.6%

-2.0%

$ 5,096.4

$ 5,072.4

0.5%

3.0%

Operating Unit Profit:

Americas:

United States

$ 6.9

$ 8.7

-20.8%

-20.8%

Other Americas

15.3

12.8

19.7%

26.2%

22.2

21.5

3.4%

7.2%

Southern Europe:

France

5.5

12.0

-54.3%

-51.4%

Italy

14.5

12.9

12.7%

18.0%

Other Southern Europe

3.5

2.2

56.0%

64.9%

23.5

27.1

-13.4%

-8.8%

Northern Europe

43.9

41.9

4.8%

8.3%

APME

19.6

16.5

18.5%

16.1%

Right Management

2.5

3.3

-24.6%

-24.5%

111.7

110.3

Corporate expenses

(26.3)

(32.0)

Intangible asset amortization expense

(9.0)

(9.6)

Reclassification of French business tax

17.4

16.9

Operating profit

93.8

85.6

9.5%

13.9%

Interest and other expenses (b)

(11.8)

(11.1)

Earnings before income taxes

$ 82.0

$ 74.5

 

 

 

 

(a)

In the United States, revenues from services include fees received from our franchise offices of $3.2 million and $2.7 million for the three months ended March 31, 2012 and 2011, respectively. These fees are primarily based on revenues generated by the franchise offices, which were $164.4 million and $148.5 million for the three months ended March 31, 2012 and 2011, respectively.

 

(b) The components of interest and other expenses were:

2012

2011

Interest expense

$ 10.6

$ 10.2

Interest income

(1.8)

(1.4)

Foreign exchange (gain) loss

(0.2)

0.5

Miscellaneous expenses, net

3.2

1.8

$ 11.8

$ 11.1

ManpowerGroup

Consolidated Balance Sheets

(In millions)

Mar. 31

Dec. 31

2012

2011

(Unaudited)

ASSETS

Current assets:

Cash and cash equivalents

$ 553.5

$ 580.5

Accounts receivable, net

4,232.7

4,181.3

Prepaid expenses and other assets

189.7

176.3

Future income tax benefits

56.5

52.4

Total current assets

5,032.4

4,990.5

Other assets:

Goodwill and other intangible assets, net

1,342.9

1,339.6

Other assets

417.1

395.1

Total other assets

1,760.0

1,734.7

Property and equipment:

Land, buildings, leasehold improvements and equipment

710.9

685.6

Less: accumulated depreciation and amortization

530.0

511.1

Net property and equipment

180.9

174.5

Total assets

$6,973.3

$6,899.7

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Accounts payable

$1,432.2

$1,370.6

Employee compensation payable

189.7

221.9

Accrued liabilities

513.0

520.8

Accrued payroll taxes and insurance

649.8

712.4

Value added taxes payable

488.0

502.3

Short-term borrowings and current maturities of long-term debt

454.2

434.2

Total current liabilities

3,726.9

3,762.2

Other liabilities:

Long-term debt

267.6

266.0

Other long-term liabilities

410.3

388.1

Total other liabilities

677.9

654.1

Shareholders' equity:

Common stock

1.1

1.1

Capital in excess of par value

2,849.8

2,839.9

Retained earnings

1,011.9

971.7

Accumulated other comprehensive income

74.8

35.3

Treasury stock, at cost

(1,369.1)

(1,364.6)

Total shareholders' equity

2,568.5

2,483.4

Total liabilities and shareholders' equity

$6,973.3

$6,899.7

 

ManpowerGroup

Consolidated Statements of Cash Flows

(In millions)

Three Months Ended

March 31

2012

2011

(Unaudited)

Cash Flows from Operating Activities:

Net earnings

$ 40.2

$ 35.7

Adjustments to reconcile net earnings to net

cash used in operating activities:

Depreciation and amortization

24.3

25.9

Deferred income taxes

(0.8)

(2.9)

Provision for doubtful accounts

5.0

5.9

Share-based compensation

6.9

8.2

Excess tax benefit on exercise of share-based awards

-

(0.5)

Changes in operating assets and liabilities, excluding

the impact of acquisitions:

Accounts receivable

34.4

(212.9)

Other assets

(16.7)

(6.3)

Other liabilities

(114.0)

(12.8)

Cash used in operating activities

(20.7)

(159.7)

Cash Flows from Investing Activities:

Capital expenditures

(19.7)

(11.2)

Acquisitions of businesses, net of cash acquired

(1.5)

-

Proceeds from sales of property and equipment

0.1

1.1

Cash used in investing activities

(21.1)

(10.1)

Cash Flows from Financing Activities:

Net change in short-term borrowings

9.5

9.6

Proceeds from long-term debt

0.1

0.1

Repayments of long-term debt

(8.4)

(0.1)

Proceeds from share-based awards

3.5

5.2

Other share-based award transactions, net

(4.5)

0.5

Cash provided by financing activities

0.2

15.3

Effect of exchange rate changes on cash

14.6

31.4

Change in cash and cash equivalents

(27.0)

(123.1)

Cash and cash equivalents, beginning of period

580.5

772.6

Cash and cash equivalents, end of period

$ 553.5

$ 649.5

SOURCE ManpowerGroup

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