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Manpower Reports 4th Quarter and Full-Year 2002 Results

PRNewswire-FirstCall
MILWAUKEE
Jan 29, 2003

Manpower Inc. (NYSE: MAN) today reported that net income for the three months ended December 31, 2002 increased 54.9 percent to $40.1 million, or 52 cents per diluted share, from $26.0 million, or 34 cents per diluted share, a year earlier. Included in 2001 net income is $4.3 million (net of income taxes) or 5 cents per diluted share of amortization of intangible assets which are no longer amortized, as required by the new accounting rules effective January 1, 2002.

Revenues for the fourth quarter totaled $2.8 billion, an increase of 11.9 percent from the year-earlier period. Systemwide sales were $3.1 billion. Results for the fourth quarter were positively affected by relatively stronger foreign currencies compared to the prior year period. On a constant currency basis, earnings per diluted share for the quarter were 44 cents on a 4.5 percent revenue increase.

Jeffrey A. Joerres, Manpower Chairman and Chief Executive Officer said, "We performed well in the fourth quarter. We continued to gain traction throughout all of our major operations. France, our largest operation, performed extraordinarily well, given the economic conditions and, once again, our geographical diversification benefited our earnings.

"In the difficult economic environment of 2002, we improved our cash flow and strengthened our balance sheet. Equally important, we strengthened our position in the marketplace through expansion of offices in the specialty service areas, launching new services and better execution of our strategies.

"This is an exciting time for Manpower, as we are well positioned to capitalize when the economies improve. Our accomplishments in 2002 are a credit to the diligent work of the Manpower team worldwide.

"Despite our optimism regarding 2003, we are still confronted with uncertainty in the majority of the markets where we operate. The acceleration that we experienced at the end of the third quarter and the beginning of the fourth quarter has slowed somewhat, which necessitates that we approach the first quarter of 2003, and potentially more of the year, with caution. We anticipate earnings per share for the first quarter of 2003 in the range of 16 to 20 cents. This includes an estimated favorable currency impact of 5 cents," Joerres said.

Net income for the year ended December 31, 2002 totaled $113.2 million or $1.46 per diluted share, down 9.1 percent from $124.5 million, or $1.62 per diluted share in 2001. Included in 2001 net income is $14.8 million (net of income taxes) or 19 cents per diluted share of amortization of intangible assets. Revenues for the year were $10.6 billion, an increase of 1.2% from the prior year. Systemwide sales were $11.8 billion. On a constant currency basis, earnings per diluted share for the year were $1.29 on a revenue decline of 2.0%.

In conjunction with its fourth quarter earnings release, Manpower will broadcast its conference call live over the Internet on January 29 at 8:00 a.m. CDT (9:00 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 3,900 offices in 63 countries. The firm annually provides employment to 2 million people worldwide and is an industry leader in employee assessment and training. Manpower also provides a range of staffing solutions, and engagement and consulting services worldwide under the subsidiary brands of Brook Street, Elan, The Empower Group and Jefferson Wells. More information on Manpower Inc. can be found at the Company's Web site, www.manpower.com , which includes a comprehensive Investor Relations section.

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, 2001, which information is incorporated herein by reference.

                              Manpower Inc.
                          Results of Operations
                   (In millions, except per share data)

                                                  Three Months Ended
                                                      December 31
                                             2002         2001      Variance


  Systemwide sales (unaudited) (a)         $3,149.3     $2,823.7     11.5%

  Revenue from services                     2,838.1      2,536.4     11.9%
  Cost of services                          2,322.4      2,057.5     12.9%

    Gross profit                              515.7        478.9      7.7%

  Selling and administrative expenses         428.6        424.6      1.0%

    Operating profit                           87.1         54.3     59.8%

  Interest and other expenses                  17.9         10.4     68.0%

    Earnings before income taxes               69.2         43.9     57.8%

  Provision for income taxes                   29.1         17.9     62.1%

    Net earnings                              $40.1        $26.0     54.9%

  Net earnings per share - basic              $0.52        $0.34     52.9%

  Net earnings per share - diluted            $0.52        $0.34     52.9%


  Weighted average shares - basic              76.9         76.0      1.2%

  Weighted average shares - diluted            77.6         77.0      0.8%


  (a)  Systemwide sales includes sales of the Company-owned branch offices
       as well as its franchise offices.


                              Manpower Inc.
                          Results of Operations
                   (In millions, except per share data)



                                                    Year Ended
                                                    December 31
                                             2002         2001     Variance

  Systemwide sales (unaudited) (a)        $11,764.9    $11,779.1    -0.1%

  Revenue from services                    10,610.9     10,483.8     1.2%
  Cost of services                          8,700.5      8,527.3     2.0%

    Gross profit                            1,910.4      1,956.5    -2.4%

  Selling and administrative expenses       1,675.6      1,718.9    -2.5%

    Operating profit                          234.8        237.6    -1.2%

  Interest and other expenses                  46.8         39.7    17.6%

    Earnings before income taxes              188.0        197.9    -5.0%

  Provision for income taxes                   74.8         73.4     1.9%

    Net earnings                             $113.2       $124.5    -9.1%

  Net earnings per share - basic              $1.48        $1.64    -9.8%

  Net earnings per share - diluted            $1.46        $1.62    -9.9%


  Weighted average shares - basic              76.4         75.9     0.6%

  Weighted average shares - diluted            77.7         77.0     0.9%


  (a)  Systemwide sales includes sales of the Company-owned branch offices
       as well as its franchise offices.


                              Manpower Inc.
                          Operating Unit Results
                              (In millions)

                                        Three Months Ended December 31

                                                             % Variance
                                                         Amount    Constant
                                     2002        2001   Reported   Currency
                                                                 (Unaudited)
  Revenues from services:
    United States (a)               $495.0      $451.2      9.7%       9.7%
    France                         1,034.5       887.1     16.6%       4.3%
    United Kingdom                   373.3       361.0      3.4%      -5.3%
    Other Europe                     560.7       483.3     16.0%       3.3%
    Other Operations                 374.6       353.8      6.0%       9.9%
                                  $2,838.1    $2,536.4     11.9%       4.5%

  Operating Unit Profit:
    United States                    $13.4        $0.5   2611.3%    2611.3%
    France                            48.1        36.8     30.8%      16.5%
    United Kingdom                     5.7        10.8    -47.1%     -50.3%
    Other Europe                      25.7        18.3     40.6%      25.3%
    Other Operations                   4.1         2.8     35.7%      46.1%
                                      97.0        69.2
  Corporate expenses                   9.9        10.1
  Amortization of intangibles            -         4.8
      Operating profit                87.1        54.3     59.8%      44.9%
  Interest and other expense (b)      17.9        10.4
      Earnings before taxes          $69.2       $43.9


  (a) Systemwide sales (unaudited) in the United States, which includes
      sales of the Company-owned branch offices as well as its franchise
      offices were $743.4 and $694.6 for the three months ended December 31,
      2002 and 2001, respectively.

  (b) The components of interest and other expense (income) were:

        Interest expense                     $10.5     $10.9
        Interest income                       (2.4)     (2.8)
        Foreign exchange (gains) losses       (1.0)      0.7
        Loss on sale of accounts receivable    0.1       0.2
        Miscellaneous, net                    10.7       1.4
                                             $17.9     $10.4


                              Manpower Inc.
                          Operating Unit Results
                              (In millions)

                                              Year Ended December 31

                                                            % Variance
                                                          Amount   Constant
                                     2002        2001   Reported   Currency
                                                                 (Unaudited)
  Revenues from services:
    United States (a)              $1,911.4    $2,003.4   -4.6%     -4.6%
    France                          3,848.2     3,766.4    2.2%     -3.8%
    United Kingdom                  1,394.0     1,489.3   -6.4%    -10.5%
    Other Europe                    2,040.9     1,939.4    5.2%     -0.6%
    Other Operations                1,416.4     1,285.3   10.2%     14.9%
                                  $10,610.9   $10,483.8    1.2%     -2.0%

  Operating Unit Profit:
    United States                     $29.2       $29.5   -0.8%     -0.8%
    France                            143.6       135.7    5.8%     -1.6%
    United Kingdom                     20.5        44.5  -53.9%    -55.9%
    Other Europe                       75.8        75.9   -0.1%     -7.5%
    Other Operations                    6.6         8.9  -27.1%    -33.7%
                                      275.7       294.5
  Corporate expenses                   40.8        39.9
  Amortization of intangibles           0.1        17.0
      Operating profit                234.8       237.6   -1.2%     -8.5%
  Interest and other expense (b)       46.8        39.7
      Earnings before taxes          $188.0      $197.9



  (a) Systemwide sales (unaudited) in the United States, which includes
      sales of the Company-owned branch offices as well as its franchise
      offices were $2,905.5 and $3,114.8 for the year ended December 31,
      2002 and 2001, respectively.

  (b) The components of interest and other expense (income) were:

       Interest expense                       $42.4      $39.1
       Interest income                         (9.0)     (10.3)
       Foreign exchange (gains) losses         (1.8)       0.2
       Loss on sale of accounts receivable      0.4        5.3
       Miscellaneous, net                      14.8        5.4
                                              $46.8      $39.7


                              Manpower Inc.
                     Restated Operating Unit Results
                              (In millions)

                                          Three Months Ended December 31

                                                          % Variance
                                                       Amount     Constant
                                     2002      2001   Reported    Currency
                                                                (Unaudited)
  Revenues from services:
    United States                   $495.0    $451.2     9.7%       9.7%
    France                         1,034.5     887.1    16.6%       4.3%
    EMEA (a)                         934.0     844.3    10.6%      -0.4%
    Other Operations                 374.6     353.8     6.0%       9.9%
                                  $2,838.1  $2,536.4    11.9%       4.5%

  Operating Unit Profit:
    United States                    $13.4      $0.5  2611.3%    2611.3%
    France                            48.1      36.8    30.8%      16.5%
    EMEA                              26.8      25.2     7.2%      -5.4%
    Other Operations                   4.1       2.8    35.7%      46.1%
                                      92.4      65.3
  Corporate expenses                   5.3       6.2
  Amortization of intangibles            -       4.8
      Operating profit                87.1      54.3    59.8%      44.9%
  Interest and other expense          17.9      10.4
      Earnings before taxes          $69.2     $43.9


  (a) Represents operations in Europe, Middle East and Africa (excluding
      France), which is a combination of operations historically included in
      segments referred to as United Kingdom and Other Europe.  In addition,
      central costs for EMEA, which historically have been included in
      corporate expense are now included in the determination of operating
      unit profit.



                              Manpower Inc.
                     Restated Operating Unit Results
                              (In millions)

                                              Year Ended December 31

                                                          % Variance
                                                       Amount     Constant
                                     2002      2001   Reported    Currency
                                                                (Unaudited)
 Revenues from services:
    United States                  $1,911.4   $2,003.4   -4.6%     -4.6%
    France                          3,848.2    3,766.4    2.2%     -3.8%
    EMEA (a)                        3,434.9    3,428.7    0.2%     -4.9%
    Other Operations                1,416.4    1,285.3   10.2%     14.9%
                                  $10,610.9  $10,483.8    1.2%     -2.0%

  Operating Unit Profit:
    United States                     $29.2      $29.5   -0.8%     -0.8%
    France                            143.6      135.7    5.8%     -1.6%
    EMEA                               83.0      106.0  -21.6%    -27.8%
    Other Operations                    6.6        8.9  -27.1%    -33.7%
                                      262.4      280.1
  Corporate expenses                   27.5       25.5
  Amortization of intangibles           0.1       17.0
      Operating profit                234.8      237.6   -1.2%     -8.5%
  Interest and other expense           46.8       46.8
      Earnings before taxes          $188.0     $197.9


  (a) Represents operations in Europe, Middle East and Africa (excluding
      France), which is a combination of operations historically included in
      segments referred to as United Kingdom and Other Europe.  In addition,
      central costs for EMEA, which historically have been included in
      corporate expense are now included in the determination of operating
      unit profit.



                              Manpower Inc.
                       Consolidated Balance Sheets
                              (In millions)

                                                 Dec. 31           Dec. 31
                                                   2002              2001
  ASSETS
  Current assets:
    Cash and cash equivalents                     $284.0            $245.8
    Accounts receivable, net                     2,214.2           1,917.8
    Prepaid expenses and other assets               76.0              77.0
    Future income tax benefits                      79.1              73.8
        Total current assets                     2,653.3           2,314.4

  Other assets:
    Intangible assets, net                         545.7             480.8
    Investments in licensees                        60.5              44.7
    Other assets                                   253.4             204.7
        Total other assets                         859.6             730.2

  Property and equipment:
    Land, buildings, leasehold
     improvements and equipment                    533.4             465.4
    Less:  accumulated depreciation and
     amortization                                  344.6             271.4
      Net property and equipment                   188.8             194.0
          Total assets                          $3,701.7          $3,238.6

  LIABILITIES AND SHAREHOLDERS' EQUITY
  Current liabilities:
    Accounts payable                              $447.0            $382.1
    Employee compensation payable                   96.2              93.2
    Accrued liabilities                            295.7             234.9
    Accrued payroll taxes and insurance            391.6             300.8
    Value added taxes payable                      309.0             255.9
    Short-term borrowings and current
      maturities of long-term debt                  22.8              23.7
        Total current liabilities                1,562.3           1,290.6

  Other liabilities:
    Long-term debt                                 799.0             811.1
    Other long-term liabilities                    340.5             322.6
        Total other liabilities                  1,139.5           1,133.7

  Shareholders' equity:
    Common stock                                     0.9               0.9
    Capital in excess of par value               1,696.2           1,644.9
    Accumulated deficit                           (289.7)           (387.6)
    Accumulated other comprehensive
     income (loss)                                (123.7)           (190.8)
    Treasury stock, at cost                       (283.8)           (253.1)
        Total shareholders' equity                 999.9             814.3
          Total liabilities and
           shareholders' equity                 $3,701.7          $3,238.6


                               Manpower Inc.
                    Consolidated Statements of Cash Flows
                                (In millions)

                                                         Year Ended
                                                         December 31
                                                   2002              2001

  Cash Flows from Operating Activities:
    Net earnings                                  $113.2            $124.5
    Adjustments to reconcile net
     earnings to net cash provided by
     operating activities:
        Depreciation and amortization               65.4              80.2
        Amortization of discount on
         convertible debentures                      7.3               2.7
        Deferred income taxes                       (0.2)             (7.3)
        Provision for doubtful accounts             18.2              23.8
        Changes in operating assets and
         liabilities:
          Amounts advanced under the
           Receivables Facility                       -             (145.0)
          Accounts receivable                      (54.4)            217.3
          Other assets                              41.6             (69.1)
          Other liabilities                         36.8             (91.1)
            Cash provided by operating
             activities                            227.9             136.0

  Cash Flows from Investing Activities:
    Capital expenditures                           (58.5)            (87.3)
    Acquisitions of business, net of
     cash acquired                                 (33.5)           (295.9)
    Proceeds from the sale of property
     and equipment                                   5.3              16.1
            Cash used by investing
             activities                            (86.7)           (367.1)

  Cash Flows from Financing Activities:
    Net borrowings from short-term
     facilities and long-term debt                (115.0)            313.0
    Proceeds from stock option and
     purchase plans                                 29.4              13.6
    Repurchase of common stock                     (30.7)             (3.3)
    Dividends paid                                 (15.3)            (15.2)
            Cash (used) provided by
             financing activities                 (131.6)            308.1

  Effect of exchange rate changes on cash           28.6             (12.9)
  Change in cash and cash equivalents               38.2              64.1

  Cash and cash equivalents, beginning
   of period                                       245.8             181.7
  Cash and cash equivalents, end of
   period                                         $284.0            $245.8

SOURCE: Manpower Inc.

CONTACT: Mike Van Handel, Chief Financial Officer of Manpower Inc.,
+1-414-906-6305

Web site: http://investor.manpower.com/
http://www.manpower.com/


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