July 24, 2018 – ManpowerGroup / (NYSE:MAN) posted second quarter revenues of $5.7 billion, an increase of nine percent from the prior year. The results fell short of Wall Street expectations. Five analysts surveyed by Zacks Investment Research expected $5.8 billion. Results were significantly impacted by stronger foreign currencies relative to the U.S. dollar compared to the prior year period.
The Milwaukee-based recruiting company also reported that U.S. revenue fell 4.6 percent during the quarter. The only other segment for which revenue fell was the outplacement provider division Right Management, which recorded a 10.5 percent decline in revenue on a constant currency basis.
Revenue growth was boosted by ManpowerGroup’s foreign operations, including in Italy where revenue rose 11.8 percent in constant currency and “other Americas,” where revenue rose 13.1 percent in constant currency. Among its other Americas operations are Mexico, where revenue rose nine percent in constant currency, and Argentina, where revenue rose 19 percent in constant currency despite falling 19 percent on a reported basis.
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During the second quarter, ManpowerGroup recorded net earnings of $1.43 million for the year, or $2.17 per diluted share, compared to earnings of $117.0 million, or $1.72 per diluted share, during the same period a year ago. The results met Wall Street expectations. The average estimate of five analysts surveyed by Zacks was also for earnings of $2.35 per share.
ManpowerGroup also reported restructuring costs of $15.3 million during the quarter, compared with $10.5 million last year. In this year’s quarter, restructuring costs were concentrated in Northern Europe where the company reported $13.2 million in such costs, according to a filing with U.S. Securities and Exchange Commission. It also reported $2.3 million in restructuring costs in Southern Europe.
“Our solid second quarter results contributed to a good first half of 2018,” said Jonas Prising, chairman and chief executive officer. “Demand for our innovative workforce solutions remains strong and with our market leading global footprint this environment should provide us with opportunities for profitable growth,” he said. “We anticipate the third quarter diluted earnings per share to be in the range of $2.37 to $2.45, which includes an estimated unfavorable currency impact of five cents.”
Manpower shares have fallen 32 percent since the beginning of the year. The stock has dropped 27 percent in the last 12 months.
Recently, ManpowerGroup named Stefano Scabbio as president of Northern Europe, Mediterranean and Eastern Europe. “Stefano has been instrumental in accelerating growth and driving next generation innovation across our European business,” said Darryl Green, COO. “Under his leadership, Stefano is enhancing and modernizing the experience for our candidates and clients, with speed, in a rapidly evolving digital market.”
Also, José Brenninkmeijer was recently appointed managing director for ManpowerGroup Netherlands. She will lead all of ManpowerGroup’s brands – Manpower, Experis, ManpowerGroup Solutions and Right Management. Jilko Andringa, current managing director for the Netherlands and president of ManpowerGroup Northern Europe, will focus wholly on his regional role following the handover with Ms. Brenninkmeijer. She had been responsible for commercial and operations for ManpowerGroup in the Netherlands for the past year.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; Stephen Sawicki, Managing Editor; and Andrew W. Mitchell, Managing Editor – Hunt Scanlon Media