Manpower Inc. (NYSE: MAN) today reported that net income for the three months ended June 30, 2003 was $29.1 million, or 37 cents per diluted share, an increase of 14 percent, from $25.7 million, or 33 cents per diluted share, a year earlier. Revenues for the second quarter totaled $3.0 billion, an increase of 16 percent from the year-earlier period. Systemwide sales were $3.3 billion. Results for the second 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 30 cents on a 1 percent improvement in revenues.
"Our second quarter performance was successful from a management perspective, however, we continue to be operating in a difficult economic environment in most of our markets around the world," said Jeffrey A. Joerres, Manpower Chairman and CEO. "Our operation in France made a sizable contribution to the quarter's profit, despite these challenges, and we also benefited from strong performances in Japan, Italy and Germany.
"In the second quarter we saw marginal increases in revenue on a global basis. However, in the U.S. we have yet to experience an increase in activity to indicate that we are in the midst of a meaningful upward economic turn," Joerres stated. "Based on our current trends, we anticipate third quarter earnings per share will be between 42 and 46 cents, including a 4 cent favorable impact from currency."
Net income for the six months ended June 30, 2003 totaled $44.0 million or 56 cents per diluted share, an increase of 35 percent from $32.6 million, or 42 cents per diluted share in 2002. Revenues for the six-month period were $5.7 billion, an increase of 16 percent from the prior year. Systemwide sales were $6.2 billion. On a constant currency basis, earnings per diluted share for the six-month period were 43 cents on a 2 percent improvement in revenues.
In conjunction with its second quarter earnings release, Manpower will broadcast its conference call live over the Internet on July 17, 2003 at 8:00 a.m. CDT (9:00 a.m. EDT). Interested parties are invited to listen to the webcast by logging on to http://investor.manpower.com/ .
The systemwide sales and constant currency amounts included in this press release are further explained on the attached Results of Operations. Supplemental financial information referenced in the conference call can be found at http://investor.manpower.com/ .
Manpower Inc. is a world leader in the staffing industry, providing workforce management services and solutions to customers through 4,000 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.
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 statements 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, 2002, which information is incorporated herein by reference, and such other factors as may be described from time to time in the Company's SEC filings.
Manpower Inc.
Results of Operations
(In millions, except per share data)
Three Months Ended June 30
% Variance
Amount Constant
2003 2002 Reported Currency
(Unaudited)
Systemwide sales (a) $3,301.6 $2,892.1 14.2%
Revenue from services 3,013.4 2,602.9 15.8% 1.0%
Cost of services 2,491.9 2,135.3 16.7%
Gross profit 521.5 467.6 11.6% -2.4%
Selling and administrative expenses 464.5 415.8 11.7% -1.6%
Operating profit 57.0 51.8 10.1% -8.5%
Interest and other expenses 9.2 9.6 -4.1%
Earnings before income taxes 47.8 42.2 13.4%
Provision for income taxes 18.7 16.5 13.0%
Net earnings $29.1 $25.7 13.6% -8.1%
Net earnings per share - basic $0.38 $0.34 11.8%
Net earnings per share - diluted $0.37 $0.33 12.1% -9.1%
Weighted average shares - basic 77.5 75.9 2.1%
Weighted average shares - diluted 78.3 77.5 1.0%
(a) Systemwide sales represents revenue from our branch offices plus
the sales activity of locations operating under a franchise agreement
with us. Systemwide sales is calculated as follows:
Revenue from services $3,013.4 $2,602.9
Less: Franchise fees 5.9 6.0
Add: Franchise sales 294.1 295.2
Systemwide sales $3,301.6 $2,892.1
Manpower Inc.
Operating Unit Results
(In millions)
Three Months Ended June 30
% Variance
Amount Constant
2003 2002 Reported Currency
(Unaudited)
Revenues from services:
United States (a) $483.9 $474.9 1.9% 1.9%
France 1,172.0 943.3 24.3% 0.6%
EMEA 951.2 830.1 14.6% -2.7%
Other Operations 406.3 354.6 14.6% 9.5%
$3,013.4 $2,602.9 15.8% 1.0%
Operating Unit Profit:
United States $10.3 $8.3 25.8% 25.8%
France 41.9 32.7 27.9% 3.6%
EMEA 7.6 16.7 -54.3% -61.0%
Other Operations 6.5 1.6 308.4% 271.6%
66.3 59.3
Corporate expenses 9.3 7.4
Amortization of other intangible
assets - 0.1
Operating profit 57.0 51.8 10.1% -8.5%
Interest and other expenses (b) 9.2 9.6
Earnings before income taxes $47.8 $42.2
(a) Systemwide sales in the United States represents revenue from our
branch offices plus the sales activity of locations operating under a
franchise agreement with us. Systemwide sales in the United States
is calculated as follows:
Revenue from services $483.9 $474.9
Less: Franchise fees 4.9 5.5
Add: Franchise sales 248.4 254.9
Systemwide sales $727.4 $724.3
(b) The components of interest and other expense (income) were:
Interest expense $10.4 $10.5
Interest income (2.1) (2.1)
Foreign exchange gains (0.3) (0.9)
Miscellaneous, net 1.2 2.1
$9.2 $9.6
Manpower Inc.
Results of Operations
(In millions, except per share data)
Six Months Ended June 30
% Variance
Amount Constant
2003 2002 Reported Currency
(Unaudited)
Systemwide sales (a) $6,241.0 $5,432.1 14.9%
Revenue from services 5,692.1 4,886.9 16.5% 2.1%
Cost of services 4,704.6 4,004.5 17.5%
Gross profit 987.5 882.4 11.9% -1.8%
Selling and administrative expenses 897.5 811.9 10.5% -2.4%
Operating profit 90.0 70.5 27.7% 4.1%
Interest and other expenses 17.8 17.6 1.6%
Earnings before income taxes 72.2 52.9 36.4%
Provision for income taxes 28.2 20.3 38.2%
Net earnings $44.0 $32.6 35.3% 3.8%
Net earnings per share - basic $0.57 $0.43 32.6%
Net earnings per share - diluted $0.56 $0.42 33.3% 2.4%
Weighted average shares - basic 77.4 76.0 1.8%
Weighted average shares - diluted 78.2 77.6 0.7%
(a) Systemwide sales represents revenue from our branch offices plus the
sales activity of locations operating under a franchise agreement
with us. Systemwide sales is calculated as follows:
Revenue from services $5,692.1 $4,886.9
Less: Franchise fees 11.9 12.3
Add: Franchise sales 560.8 557.5
Systemwide sales $6,241.0 $5,432.1
Manpower Inc.
Operating Unit Results
(In millions)
Six Months Ended June 30
% Variance
Amount Constant
2003 2002 Reported Currency
(Unaudited)
Revenues from services:
United States (a) $947.4 $903.6 4.8% 4.8%
France 2,126.6 1,710.4 24.3% 1.1%
EMEA 1,837.6 1,594.3 15.3% -2.1%
Other Operations 780.5 678.6 15.0% 11.1%
$5,692.1 $4,886.9 16.5% 2.1%
Operating Unit Profit:
United States $13.0 $3.4 287.4% 287.4%
France 68.8 54.9 25.3% 1.8%
EMEA 17.4 27.7 -37.1% -46.8%
Other Operations 8.9 (0.2) N/A N/A
108.1 85.8
Corporate expenses 18.1 15.2
Amortization of other intangible
assets - 0.1
Operating profit 90.0 70.5 27.7% 4.1%
Interest and other expenses (b) 17.8 17.6
Earnings before income taxes $72.2 $52.9
(a) Systemwide sales in the United States represents revenue from our
branch offices plus the sales activity of locations operating under a
franchise agreement with us. Systemwide sales in the United States
is calculated as follows:
Revenue from services $947.4 $903.6
Less: Franchise fees 10.1 10.4
Add: Franchise sales 478.0 485.1
Systemwide sales $1,415.3 $1,378.3
(b) The components of interest and other expense (income) were:
Interest expense $20.4 $20.4
Interest income (4.5) (4.7)
Foreign exchange gains (1.5) (0.7)
Miscellaneous, net 3.4 2.6
$17.8 $17.6
Manpower Inc.
Consolidated Balance Sheets
(In millions)
June 30 Dec. 31
2003 2002
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $252.1 $284.0
Accounts receivable, net 2,437.8 2,214.2
Prepaid expenses and other assets 84.6 76.0
Future income tax benefits 77.1 79.1
Total current assets 2,851.6 2,653.3
Other assets:
Goodwill and other intangible assets, net 556.6 545.7
Investments in licensees 61.8 60.5
Other assets 305.0 253.4
Total other assets 923.4 859.6
Property and equipment:
Land, buildings, leasehold
improvements and equipment 569.2 533.4
Less: accumulated depreciation and
amortization 385.1 344.6
Net property and equipment 184.1 188.8
Total assets $3,959.1 $3,701.7
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $521.8 $447.0
Employee compensation payable 96.0 96.2
Accrued liabilities 313.9 295.7
Accrued payroll taxes and insurance 395.2 391.6
Value added taxes payable 343.4 309.0
Short-term borrowings and current
maturities of long-term debt 15.4 22.8
Total current liabilities 1,685.7 1,562.3
Other liabilities:
Long-term debt 813.5 799.0
Other long-term liabilities 351.2 340.5
Total other liabilities 1,164.7 1,139.5
Shareholders' equity:
Common stock 0.9 0.9
Capital in excess of par value 1,710.1 1,696.2
Accumulated deficit (253.5) (289.7)
Accumulated other comprehensive income (loss) (65.0) (123.7)
Treasury stock, at cost (283.8) (283.8)
Total shareholders' equity 1,108.7 999.9
Total liabilities and
shareholders' equity $3,959.1 $3,701.7
Manpower Inc.
Consolidated Statements of Cash Flows
(In millions)
Six Months Ended
June 30
2003 2002
(Unaudited)
Cash Flows from Operating Activities:
Net earnings $44.0 $32.6
Adjustments to reconcile net
earnings to net cash provided by operating
activities:
Depreciation and amortization 31.4 32.8
Amortization of discount on
convertible debentures 3.8 3.6
Deferred income taxes 4.7 2.4
Provision for doubtful accounts 8.0 9.1
Changes in operating assets and
liabilities:
Accounts receivable (76.5) (146.4)
Other assets (25.8) (4.8)
Other liabilities 28.1 108.8
Cash provided by operating activities 17.7 38.1
Cash Flows from Investing Activities:
Capital expenditures (23.8) (31.0)
Acquisitions of business, net of
cash acquired (2.5) (29.6)
Proceeds from the sale of property
and equipment 2.5 1.5
Cash used by investing activities (23.8) (59.1)
Cash Flows from Financing Activities:
Net (repayments) borrowings of
short-term facilities and long-term debt (44.5) 17.3
Proceeds from stock option and
purchase plans 13.9 26.1
Repurchase of common stock - (30.7)
Dividends paid (7.8) (7.6)
Cash (used) provided by
financing activities (38.4) 5.1
Effect of exchange rate changes on cash 12.6 19.1
Change in cash and cash equivalents (31.9) 3.2
Cash and cash equivalents, beginning of period 284.0 245.8
Cash and cash equivalents, end of period $252.1 $249.0
SOURCE: Manpower Inc.
CONTACT: Mike Van Handel, Chief Financial Officer of Manpower,
+1-414-906-6305
Web site: http://investor.manpower.com/
http://www.manpower.com/
