Manpower Inc. (NYSE: MAN) today reported that net income for the three months ended June 30, 2001 declined 9 percent to $34.6 million, or 45 cents per diluted share, from $38.0 million, or 49 cents per diluted share, a year earlier. Revenues for the second quarter totaled $2.6 billion, a decline of 3 percent from the year-earlier period. The gross profit margin improved to 18.7 percent in the quarter from 17.6 percent the prior year as gross margin improvements were realized in several of the company's markets including France, the U.S. and the U.K. Results for the second quarter were once again affected by relatively weaker foreign currencies compared to the prior year period. On a constant currency basis, earnings per share for the quarter were ahead of prior year at 50 cents on a 3 percent revenue gain.
"Our customers across the U.S. are reducing their overall workforce to more accurately reflect the slowing demand for their products and services. In turn, this has reduced our sales significantly. Not surprisingly, we are now witnessing this "flexing" moving into Europe," Manpower President and CEO, Jeffrey A. Joerres stated. "Although the economic environment has deteriorated, we have not reduced our focus on our key strategic initiatives. I continue to be pleased with our improving gross profit margin. This reflects our continuing efforts to re-balance our business mix as well as the strength and value that the Manpower brand brings to our customers."
Commenting on the outlook for the second half of the year, Joerres added, "The global economic slowing will continue to challenge revenue and profit growth for the balance of the year. Given the current economic environment, forecasting with any degree of certainty becomes difficult, however, we now expect earnings for the full year to decline in the range of 13 percent in constant currency, which would be in the range of $1.80 per share. We estimate earnings for the third quarter to be between 48 cents and 52 cents per share."
Net income for the six months ended June 30, 2001 totaled $61.5 million or 80 cents per diluted share, down 3 percent from $63.6 million, or 82 cents per diluted share in 2000. Revenues for the six-month period matched the prior year at $5.3 billion. On a constant currency basis, earnings per share for the six-month period rose 9 percent on a revenue increase of 6 percent.
In conjunction with its second quarter earnings release, Manpower will broadcast its conference call live over the Internet on July 19, 2001 at 9:00 a.m. CDT (10:00 a.m. EDT). Interested parties are invited to listen by logging on to http://investor.manpower.com/ .
Manpower Inc. is a world leader in the staffing industry, providing workforce management services and solutions to customers through 3,800 offices in 59 countries. The firm annually provides employment to more than 2.7 million people worldwide and is an industry leader in employee assessment and training. Manpower also offers organizational performance consulting services worldwide through its independent operating division, The Empower Group. More information on Manpower Inc. can be found at the company's website, http://www.manpower.com/ . More information can also be found about The Empower Group at its website, http://www.empowergrp.com/ .
This news release contains statements, including earning projections, that are forward-looking in nature and, accordingly, are subject to risks and uncertainties regarding the Company's expected future results. The Company's actual results may differ materially from those described or contemplated in the forward-looking statements. Factors that may cause the Company's actual results to differ materially from those contained in the forward-looking statement can be found in the Company's reports filed with the SEC, including its Annual Report on Form 10-K for the year ended December 31, 2000, which information is incorporated herein by reference.
Manpower Inc.
Results of Operations
(In millions, except per share data)
Three Months Ended June 30
2001 2000 Variance
Systemwide sales $2,944.1 $3,121.9 -5.7%
Revenue from services 2,620.1 2,714.1 -3.5%
Cost of services 2,131.0 2,236.3 -4.7%
Gross profit 489.1 477.8 2.4%
Selling and administrative expenses 426.4 408.1 4.5%
Operating profit 62.7 69.7 -10.1%
Interest and other expenses 8.6 10.7 -20.3%
Earnings before income taxes 54.1 59.0 -8.3%
Provision for income taxes 19.5 21.0 -7.1%
Net earnings $34.6 $38.0 -8.9%
Net earnings per share - basic $0.46 $0.50 -8.0%
Net earnings per share - diluted $0.45 $0.49 -8.2%
Weighted average shares - basic 75.8 76.0 -0.2%
Weighted average shares - diluted 76.9 77.1 -0.4%
Manpower Inc.
Results of Operations
(In millions, except per share data)
Six Months Ended June 30
2001 2000 Variance
Systemwide sales $5,955.2 $6,097.4 -2.3%
Revenue from services 5,272.0 5,282.4 -0.2%
Cost of services 4,299.0 4,358.6 -1.4%
Gross profit 973.0 923.8 5.3%
Selling and administrative expenses 858.2 803.6 6.8%
Operating profit 114.8 120.2 -4.5%
Interest and other expenses 18.8 21.5 -12.5%
Earnings before income taxes 96.0 98.7 -2.7%
Provision for income taxes 34.5 35.1 -1.4%
Net earnings $61.5 $63.6 -3.4%
Net earnings per share - basic $0.81 $0.84 -3.6%
Net earnings per share - diluted $0.80 $0.82 -2.4%
Weighted average shares - basic 75.8 76.0 -0.3%
Weighted average shares - diluted 76.9 77.2 -0.4%
Manpower Inc.
Operating Unit Results
(In millions)
Three Months Ended Six Months Ended
June 30 June 30
2001 2000 2001 2000
Revenues from services:
United States (a) $523.5 $609.6 $1,069.8 $1,173.5
France 948.6 1,021.0 1,887.8 1,934.6
United Kingdom 369.6 347.2 750.5 712.2
Other Europe 475.3 459.8 974.6 919.3
Other Countries 303.1 276.5 589.3 542.8
$2,620.1 $2,714.1 $5,272.0 $5,282.4
Operating Unit Profit:
United States $12.2 $23.0 $20.4 $38.5
France 35.4 31.5 61.7 52.3
United Kingdom 10.2 9.6 19.9 17.6
Other Europe 17.7 17.8 37.0 32.5
Other Countries 1.1 1.5 3.0 5.1
76.6 83.4 142.0 146.0
Corporate expenses 10.0 10.4 19.6 18.9
Amortization of intangibles 3.9 3.3 7.6 6.9
Operating profit 62.7 69.7 114.8 120.2
Interest and other expense (b) 8.6 10.7 18.8 21.5
Earnings before taxes $54.1 $59.0 $96.0 $98.7
Footnotes:
(a) Total systemwide sales in the United States, which includes sales of
Company-owned branches and franchises were $801.5 and $965.3 for the
three months ended June 30, 2001 and 2000, respectively, and $1,663.0
and $1,887.3 for the six months ended June 30, 2001 and 2000,
respectively.
(b) The components of interest and
other expense (income) were:
Interest expense $8.7 $7.9 $17.4 $15.8
Interest income (2.4) (1.7) (5.0) (3.7)
Translation loss (gain) (0.9) 0.2 (0.2) 1.3
Loss on sale of accounts
receivable 1.7 2.1 4.0 5.2
Miscellaneous 1.5 2.2 2.6 2.9
$8.6 $10.7 $18.8 $21.5
Manpower Inc.
Condensed Balance Sheets
(In millions)
June 30 Dec. 31
2001 2000
(Unaudited)
Current assets:
Cash and cash equivalents $169.7 $181.7
Accounts receivable 1,969.2 2,094.4
Prepaid expenses and other assets 134.3 120.6
Total current assets 2,273.2 2,396.7
Other assets 513.3 453.3
Property and equipment 184.4 191.6
Total assets $2,970.9 $3,041.6
Current liabilities:
Accounts payable $477.3 $453.1
Employee compensation payable 78.4 81.2
Accrued liabilities 214.5 269.2
Accrued payroll taxes and insurance 305.1 341.8
Value added tax payable 276.7 311.0
Short-term borrowings and current
maturities of long-term debt 38.4 65.9
Total current liabilities 1,390.4 1,522.2
Other liabilities:
Long-term debt 545.2 491.6
Other long-term liabilities 291.2 287.4
Total other liabilities 836.4 779.0
Shareholders' equity 744.1 740.4
Total liabilities and shareholders'
equity $2,970.9 $3,041.6
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SOURCE: Manpower Inc.
Contact: Mike Van Handel, Chief Financial Officer of Manpower,
+1-414-906-6305
Website: http://www.manpower.com/
http://investor.manpower.com/
http://www.empowergrp.com/
