Manpower Inc. (NYSE: MAN) today reported that earnings per diluted share for the three months ended June 30, 2005 increased 25% to 70 cents from 56 cents in the prior year period. Net income in the quarter increased to $62.5 million from $53.1 million a year earlier. Revenues for the second quarter totaled $4.1 billion, an increase of 12 percent from the year-earlier period. 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 68 cents on an 8 percent improvement in revenues.
Jeffrey A. Joerres, Manpower Chairman and Chief Executive Officer, said, "Manpower's team across the world aggressively executed our initiatives yielding strong results. Our focus on growth in specialty areas is enabling us to expand our offering and enhance profitability. Jefferson Wells, our finance and accounting group, continues to show solid growth in both Sarbanes-Oxley and non-Sarbanes work, which is a balance that we have been striving toward.
"We are experiencing steady trends in the commercial staffing area throughout most of the world. These trends, and the ability of our team to continue to operate more efficiently, add to our confidence for the balance of the year.
"We are anticipating the third quarter of 2005 diluted earnings per share to be in the range of 81 to 85 cents. Based upon current exchange rates, any currency impact is not expected to be significant," Joerres stated.
Earnings per diluted share for the six months ended June 30, 2005 were $1.03, an increase of 4% from 99 cents per diluted share in 2004. Net income was $94.7 million compared to $92.7 million the prior year. Revenues for the six-month period were $7.8 billion, an increase of 12 percent from the prior year. On a constant currency basis, earnings per diluted share for the six- month period were $1.00 on a 9 percent improvement in revenues.
Included in the prior year six-month period was a first quarter non- operating gain of $14.2 million ($10.2 million net of income taxes), or 11 cents per diluted share.
In conjunction with its second quarter earnings release, Manpower will broadcast its conference call live over the Internet on July 19, 2005 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/ .
Supplemental financial information referenced in the conference call can be found at http://investor.manpower.com/ .
About Manpower Inc.
Manpower Inc. (NYSE: MAN) is a world leader in the employment services industry, offering customers a continuum of services to meet their needs throughout the employment and business cycle. The company specializes in permanent, temporary and contract recruitment; employee assessment; training; career transition; organizational consulting; and professional financial services. Manpower's worldwide network of 4,300 offices in 68 countries and territories enables the company to meet the needs of its 400,000 customers per year, including small and medium size enterprises in all industry sectors, as well as the world's largest multinational corporations. The focus of Manpower's work is on raising productivity through improved quality, efficiency and cost-reduction, enabling customers to concentrate on their core business activities. In addition to the Manpower brand, the company operates under the brand names of Right Management Consultants, Jefferson Wells, Elan and Brook Street. More information on Manpower Inc. is available at http://www.manpower.com/ .
Forward-Looking Statements
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 the information under the heading 'Forward-Looking Statements' in its Annual Report on Form 10-K for the year ended December 31, 2004, which information is incorporated herein by reference.
Manpower Inc.
Results of Operations
(In millions, except per share data)
Three Months Ended June 30
% Variance
Amount Constant
2005 2004 Reported Currency
(Unaudited)
Revenues from services (a) $4,053.7 $3,622.4 11.9% 8.2%
Cost of services 3,314.5 2,943.1 12.6%
Gross profit 739.2 679.3 8.8% 5.4%
Selling and administrative expenses 629.5 584.1 7.8% 4.4%
Operating profit 109.7 95.2 15.2% 11.2%
Interest and other expense 11.3 12.3 -8.1%
Earnings before income taxes 98.4 82.9 18.7%
Provision for income taxes 35.9 29.8 20.3%
Net earnings $62.5 $53.1 17.7% 14.2%
Net earnings per share - basic $0.71 $0.59 20.3%
Net earnings per share - diluted (b) $0.70 $0.56 25.0% 21.4%
Weighted average shares - basic 88.6 89.6 -1.1%
Weighted average shares - diluted (b) 89.5 97.4 -8.1%
(a) Revenues from services include fees received from our franchise
offices of $8.8 million and $7.9 million for the three months ended
June 30, 2005 and 2004, respectively. These fees are primarily based
on revenues generated by the franchise offices, which were $375.7
million and $350.4 million for the three months ended June 30, 2005
and 2004, respectively.
(b) Prior year figures have been restated to reflect the impact of
applying the "if-converted" method to our convertible debentures.
Manpower Inc.
Operating Unit Results
(In millions)
Three Months Ended June 30
% Variance
Amount Constant
2005 2004 Reported Currency
(Unaudited)
Revenues from Services:
United States (a) $506.7 $517.3 -2.1% -2.1%
France 1,408.3 1,278.3 10.2% 5.6%
EMEA 1,419.1 1,202.2 18.0% 13.6%
Jefferson Wells 93.5 76.6 22.0% 22.0%
Right 108.5 119.9 -9.6% -12.0%
Other Operations 517.6 428.1 20.9% 15.9%
$4,053.7 $3,622.4 11.9% 8.2%
Operating Unit Profit:
United States $18.0 $14.1 27.3% 27.3%
France 41.5 39.4 5.1% 1.1%
EMEA 38.4 26.2 46.8% 41.6%
Jefferson Wells 9.3 11.1 -16.0% -16.0%
Right 9.3 12.6 -25.8% -27.9%
Other Operations 13.2 9.6 36.4% 30.5%
129.7 113.0
Corporate expenses 16.7 14.4
Amortization of intangible assets 3.3 3.4
Operating profit 109.7 95.2 15.2% 11.2%
Interest and other expense (b) 11.3 12.3
Earnings before income taxes $98.4 $82.9
(a) In the United States, revenues from services include fees received
from the related franchise offices of $6.3 million and $5.8 million
for the three months ended June 30, 2005 and 2004, respectively.
These fees are primarily based on revenues generated by the franchise
offices, which were $296.8 million and $289.7 million for the three
months ended June 30, 2005 and 2004, respectively.
(b) The components of interest and other expense (income) were:
Interest expense $10.7 $12.0
Interest income (2.1) (1.6)
Foreign exchange (gains)
losses (0.6) 0.2
Miscellaneous expenses, net 3.3 1.7
$11.3 $12.3
Manpower Inc.
Results of Operations
(In millions, except per share data)
Six Months Ended June 30
% Variance
Amount Constant
2005 2004 Reported Currency
(Unaudited)
Revenues from services (a) $7,812.4 $6,956.5 12.3% 8.5%
Cost of services 6,391.2 5,660.7 12.9%
Gross profit 1,421.2 1,295.8 9.7% 6.1%
Selling and administrative expenses 1,249.0 1,144.4 9.1% 5.7%
Operating profit 172.2 151.4 13.7% 9.5%
Interest and other expenses 23.0 8.3 177.4%
Earnings before income taxes 149.2 143.1 4.2%
Provision for income taxes 54.5 50.4 7.9%
Net earnings $94.7 $92.7 2.2% -1.2%
Net earnings per share - basic $1.06 $1.06 -
Net earnings per share - diluted (b) $1.03 $0.99 4.0% 1.0%
Weighted average shares - basic 89.2 87.7 1.7%
Weighted average shares - diluted (b) 93.2 96.0 -2.9%
(a) Revenues from services include fees received from our franchise
offices of $17.1 million and $16.1 million for the six months ended
June 30, 2005 and 2004, respectively. These fees are primarily based
on revenues generated by the franchise offices, which were $725.5
million and $671.9 million for the six months ended June 30, 2005 and
2004, respectively.
(b) Prior year figures have been restated to reflect the impact of
applying the "if-converted" method to our convertible debentures.
Manpower Inc.
Operating Unit Results
(In millions)
Six Months Ended June 30
% Variance
Amount Constant
2005 2004 Reported Currency
(Unaudited)
Revenues from Services:
United States (a) $982.6 $991.9 -0.9% -0.9%
France 2,655.8 2,414.8 10.0% 5.2%
EMEA 2,752.2 2,343.1 17.5% 12.7%
Jefferson Wells 186.2 127.1 46.5% 46.5%
Right 212.5 221.7 -4.2% -6.6%
Other Operations 1,023.1 857.9 19.3% 15.4%
$7,812.4 $6,956.5 12.3% 8.5%
Operating Unit Profit:
United States $22.9 $16.9 35.2% 35.2%
France 69.0 68.2 1.2% -3.3%
EMEA 53.4 39.9 34.0% 28.8%
Jefferson Wells 17.4 13.1 32.7% 32.7%
Right 19.1 21.7 -11.7% -14.0%
Other Operations 25.7 24.9 2.8% -0.7%
207.5 184.7
Corporate expenses 28.8 27.6
Amortization of intangible assets 6.5 5.7
Operating profit 172.2 151.4 13.7% 9.5%
Interest and other expenses (b) 23.0 8.3
Earnings before income taxes $149.2 $143.1
(a) In the United States, revenues from services include fees received
from the related franchise offices of $11.7 million and $12.0 million
for the six months ended June 30, 2005 and 2004, respectively. These
fees are primarily based on revenues generated by the franchise
offices, which were $574.4 million and $552.7 million for the six
months ended June 30, 2005 and 2004, respectively.
(b) The components of interest and other expense (income) were:
Interest expense $22.3 $23.1
Interest income (4.4) (4.0)
Foreign exchange losses 0.2 0.3
Miscellaneous expense
(income), net 4.9 (11.1)
$23.0 $8.3
Manpower Inc.
Consolidated Balance Sheets
(In millions)
Jun. 30 Dec. 31
2005 2004
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $363.3 $531.8
Accounts receivable, net 3,084.7 3,227.8
Prepaid expenses and other assets 92.7 161.4
Future income tax benefits 107.7 96.5
Total current assets 3,648.4 4,017.5
Other assets:
Goodwill and other intangible
assets, net 1,268.2 1,297.0
Other assets 307.0 305.5
Total other assets 1,575.2 1,602.5
Property and equipment:
Land, buildings, leasehold
improvements and equipment 641.5 669.8
Less: accumulated depreciation and
amortization 441.3 446.7
Net property and equipment 200.2 223.1
Total assets $5,423.8 $5,843.1
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $710.8 $687.1
Employee compensation payable 135.0 156.0
Accrued liabilities 470.3 505.7
Accrued payroll taxes and insurance 519.2 569.6
Value added taxes payable 413.6 457.8
Short-term borrowings and current
maturities of long-term debt 27.0 225.7
Total current liabilities 2,275.9 2,601.9
Other liabilities:
Long-term debt 727.1 676.1
Other long-term liabilities 381.4 391.1
Total other liabilities 1,108.5 1,067.2
Shareholders' equity:
Common stock 1.0 1.0
Capital in excess of par value 2,324.9 2,296.4
Retained earnings 128.0 51.0
Accumulated other comprehensive
income 31.4 109.4
Treasury stock, at cost (445.9) (283.8)
Total shareholders' equity 2,039.4 2,174.0
Total liabilities and
shareholders' equity $5,423.8 $5,843.1
Manpower Inc.
Consolidated Statements of Cash Flows
(In millions)
Six Months Ended
June 30
2005 2004
(Unaudited)
Cash Flows from Operating Activities:
Net earnings $94.7 $92.7
Adjustments to reconcile net
earnings to net
cash provided by operating
activities:
Depreciation and amortization 45.5 41.4
Amortization of discount on
convertible debentures 1.9 3.9
Deferred income taxes (6.8) (8.9)
Provision for doubtful accounts 8.2 12.2
Other non-operating gains - (14.2)
Changes in operating assets and
liabilities excluding
the impact of acquisitions:
Accounts receivable (140.9) (245.1)
Other assets (23.9) 13.3
Other liabilities 119.7 172.3
Cash provided by
operating activities 98.4 67.6
Cash Flows from Investing Activities:
Capital expenditures (36.1) (27.0)
Acquisitions of businesses, net of
cash acquired (3.1) (103.6)
Proceeds from sale of an equity
interest - 29.8
Proceeds from the sale of property
and equipment 3.1 3.8
Cash used by investing activities (36.1) (97.0)
Cash Flows from Financing Activities:
Net borrowings of short-term
facilities and long-term debt 174.2 8.7
Cash paid to settle convertible
debentures (206.6) -
Proceeds from settlement of swap
agreements 50.7 -
Proceeds from stock option and
purchase plans 9.2 52.8
Repurchases of common stock (203.5) -
Dividends paid (17.6) (9.1)
Cash (used) provided by
financing activities (193.6) 52.4
Effect of exchange rate changes on
cash (37.2) (8.8)
Change in cash and cash equivalents (168.5) 14.2
Cash and cash equivalents, beginning
of period 531.8 426.2
Cash and cash equivalents, end of
period $363.3 $440.4
SOURCE: Manpower Inc.
CONTACT: Mike Van Handel, Chief Financial Officer of Manpower Inc.,
+1-414-906-6305
Web site: http://www.manpower.com/
