October 21, 2019 – ManpowerGroup / (NYSE:MAN) posted third quarter revenues of $5.2 billion, a decrease of three percent from the same period a year ago. This missed the Zacks Consensus Estimate by 1.90 percent. U.S. revenue rose two percent in the quarter; in France, its largest single market, revenue fell one percent on a constant currency basis.
The Milwaukee-based recruiting company recorded net earnings of $146.1 million for the year, or $2.42 per diluted share, compared to earnings of $158 million for the year, or $2.43 per diluted share, during the same period last year.
“The global economic environment continues to be uncertain, leading to uneven market conditions as economic growth slows but labor markets remain tight and skills shortages high,” said Jonas Prising, chairman and CEO of ManpowerGroup. “This was evident in our third quarter results and despite headwinds in Europe, many of our markets achieved good profitable growth, with the U.S., the U.K., Japan, Norway, Spain and Canada leading the way.”
ManpowerGroup recently appointed former Molson Coors Brewing Co. veteran Michelle Nettles as chief people and culture officer. She will lead HR and culture across the organization’s 80 countries and territories and across its family of brands and functions – Manpower, Experis, Right Management and ManpowerGroup Solutions.
“Michelle is an impressive people leader with extensive experience in global HR and a proven track record in driving a diverse and inclusive culture across multiple countries,” said Mr. Prising. “Her vision of employees as consumers together with her passion to broaden and deepen people’s skills and drive strong leadership capability is a great fit for ManpowerGroup as we continue to digitize and transform our business. I’m pleased to welcome Michelle to the ManpowerGroup senior leadership team.”
ManpowerGroup recently purchased the remaining interest in the Switzerland Manpower business with annual revenues of about $500 million during April. During the first quarter, ManpowerGroup also repurchased 1.2 million shares of common stock for $101 million. The effective tax rate for the first quarter equaled 42.8 percent, or 36.4 percent excluding the impact of restructuring costs. The effective tax rate increased in 2019 following the termination of the French tax exempt CICE subsidy in 2018.
Right Management, the global career and talent development expert within ManpowerGroup, recently launched a new executive transition offering in the U.S. The “E•Series Executive Transition Services” draws on the workforce and assessment expertise of ManpowerGroup and the leadership development of Right Management to bring comprehensive transition support to executives, the company said.
“Organizations in all industries are experiencing disruption from digital transformation to public policy changes and shifting demographics,” said Ian Symes, executive vice president of Right Management Europe & North America. “In times of change, leader turnover rises. Since 2017, we’ve seen close to a 10 percent increase in leaders moving on. In the digital age leaders need to lead differently to capture opportunity and stay relevant. Helping those whose skills no longer fit transition smoothly to new positions outside the organization is not only the right thing to do; it’s critical to mitigating risk and protecting your employer brand.”
Recruiting Sector Jumps 13.9 Percent, Driven by Tightening Talent Markets
A constricting labor market with low unemployment means companies are struggling to find qualified talent. When the right people are found, the costs associated with hiring them are rising, making a lengthy onboarding process now the rule, not the exception.
Right Management also announced it will significantly increase its presence in the U.S. and Canada this year and invest in new digital tools. Right Management said it will increase the number of locations where it hosts clients and individuals, including flexible workspaces, offices and pop-up locations. It also intends to enhance its digital offerings to enable on-demand access to its talent management, career development and outplacement tools.
“We know individuals and clients want to meet us in locations and spaces that are most convenient to them,” said Mr. Symes. “With that in mind, we are changing the way we do business in the U.S. and Canada – investing in new high-tech workspaces and expanding our portfolio of digital tools with anywhere access. We know this model works – this is the latest phase in our global transformation, which begun three years ago.”
“We anticipate diluted earnings per share in the fourth quarter will be between $2.00 and $2.08, which includes an estimated unfavorable currency impact of seven cents,” said Mr. Prising.
ManpowerGroup also repurchased 610 thousand shares of common stock for $51 million during the quarter.
Shares in ManpowerGroup were up 2.94 percent to $88.36 upon the release of its third quarter revenues. The company had a market cap of $5.14 billion.
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