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Manpower Inc. Reports 3rd Quarter 2009 Results

PRNewswire-FirstCall
MILWAUKEE
Oct 21, 2009

Manpower Inc. (NYSE: MAN) today reported that earnings per diluted share for the three months ended September 30, 2009 were a loss of 64 cents compared to a loss of 55 cents in the prior year period. Revenues for the third quarter were $4.2 billion, a decrease of 26 percent from the year earlier period, or a decrease of 22 percent in constant currency.

(Logo: http://www.newscom.com/cgi-bin/prnh/20060221/CGTU012LOGO)

Third quarter 2009 results include a loss on the sale of an equity investment and a goodwill impairment charge totaling $71.3 million ($66.3 million after tax) or 84 cents per diluted share. Also included in third quarter results is a $7.5 million ($4.6 million after tax) or 6 cents per diluted share charge related to the repayment of our revolver borrowings and the extinguishment of an interest rate swap agreement in October. Excluding these charges, third quarter net earnings would have been $20.5 million, or 26 cents per diluted share.

Third quarter results were unfavorably impacted by 2 cents per diluted share as foreign currencies were relatively weaker compared to the third quarter of 2008.

Third quarter 2008 results include a goodwill and intangible asset impairment charge of $163.1 million ($154.6 million after tax) or $1.97 per diluted share.

Jeffrey A. Joerres, Manpower Inc. Chairman and Chief Executive Officer, said, "We continued to experience sluggish demand for our services as the labor markets throughout the world were hampered by lack of demand for companies' products and services. All of our major operations contributed to our better than expected profitability as revenue across the board was marginally stronger, however, the uptick in revenue is muted at this time compared to previous recoveries.

"The increases that we have seen in our revenue over the last quarter indicate that our decisions to preserve our office network at its current level are appropriate. We will continue to monitor the environment and make modifications if we experience deterioration in the existing trends.

"While the current economic environment makes forecasting demand for our services difficult, we anticipate the fourth quarter of 2009 diluted earnings per share to be in the range of $.17 to $.27, which includes an estimated positive currency impact of 3 cents," Joerres stated.

Earnings per diluted share for the nine months ended September 30, 2009 were a loss of 37 cents compared to earnings of $1.75 per diluted share in 2008. Net earnings were a loss of $28.8 million compared to net earnings of $139.7 million in the prior year. Revenues for the nine-month period were $11.6 billion, a decrease of 31 percent from the prior year or 23 percent in constant currency. Foreign currency exchange rates had an unfavorable impact of 5 cents for the nine-month period.

Earnings per diluted share for the nine month period in 2009 include the loss on the sale of the equity investment and goodwill impairment charge totaling 84 cents, the charge of 6 cents related to the repayment of our revolver borrowings and extinguishment of an interest rate swap, and the first and second quarter reorganization charges totaling 17 cents. Earnings per diluted share for the nine month period in 2008 include the goodwill and intangible asset impairment charge of $1.93 (based on the weighted average shares for the nine-month period) and a net charge of 18 cents recorded in the second quarter related to an increase in our legal reserve and recoverable 2005 payroll taxes in France.

In conjunction with its third quarter earnings release, Manpower will broadcast its conference call live over the Internet on October 21, 2009 at 7:30 a.m. CDT (8:30 a.m. EDT). Interested parties are invited to listen to the webcast and view the presentation 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; creating and delivering services that enable its clients to win in the changing world of work. 60 years old in 2009, the company offers employers a range of services for the entire employment and business cycle including permanent, temporary and contract recruitment; employee assessment and selection; training; outplacement; outsourcing and consulting. Manpower's worldwide network of 4,000 offices in 82 countries and territories enables the company to meet the needs of its 400,000 clients 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 across their total workforce, enabling clients to concentrate on their core business activities. Manpower Inc. operates under five brands: Manpower, Manpower Professional, Elan, Jefferson Wells and Right Management. More information on Manpower Inc. is available at www.manpower.com.

Forward-Looking Statements

This news release contains statements, including earnings 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 'Risk Factors' in its Annual Report on Form 10-K for the year ended December 31, 2008, which information is incorporated herein by reference.

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

                                         Three Months Ended September 30
                                         -------------------------------
                                                            % Variance
                                                         -------------------
                                                          Amount   Constant
                                        2009      2008   Reported  Currency
                                        ----      ----   --------  --------
                                                   (Unaudited)
  Revenues from services (a)         $4,192.1  $5,668.4     -26.0%    -21.5%

  Cost of services                    3,485.5   4,640.8     -24.9%    -20.2%
                                      -------   -------

    Gross profit                        706.6   1,027.6     -31.2%    -27.5%

  Selling and administrative
   expenses, excluding impairment
   charges                              664.6     843.5     -21.2%    -16.9%
  Goodwill and intangible asset
   impairment (b)                        61.0     163.1     -62.6%    -62.6%
                                         ----     -----
    Selling and administrative
     expenses                           725.6   1,006.6     -27.9%    -24.3%

    Operating (loss) profit             (19.0)     21.0       N/A       N/A

  Interest and other expenses            29.3      13.4     118.0%
                                         ----      ----

    (Loss) earnings before income
     taxes                              (48.3)      7.6       N/A       N/A

  Provision for income taxes              2.1      50.8     -96.0%
                                          ---      ----

    Net loss                           $(50.4)   $(43.2)      N/A       N/A
                                       ======    ======

  Net loss per share - basic           $(0.64)   $(0.55)      N/A
                                       ======    ======

  Net loss per share - diluted         $(0.64)   $(0.55)      N/A       N/A
                                       ======    ======

  Weighted average shares - basic        78.4      78.6      -0.3%
                                         ====      ====

  Weighted average shares - diluted      78.4      78.6      -0.3%
                                         ====      ====

  (a)  Revenues from services include fees received from our franchise
       offices of $5.7 million and $8.0 million for the three months ended
       September 30, 2009 and 2008, respectively. These fees are primarily
       based on revenues generated by the franchise offices, which were
       $200.3 million and $282.2 million for the three months ended
       September 30, 2009 and 2008,
       respectively.

  (b)  The goodwill impairment charge for the three months ended September
       30, 2009 relates to our investment in Jefferson Wells.  The goodwill
       and intangible asset impairment charge for the three months ended
       September 30, 2008 relates to our investment in Right Management.
       The impact on net earnings is $61.0 million and $154.6 million, or
       $0.78 and $1.97 per diluted share, for the three months ended
       September 30, 2009 and 2008, respectively.



                              Manpower Inc.
                         Operating Unit Results
                              (In millions)

                                   Three Months Ended September 30
                                   -------------------------------
                                                      % Variance
                                                   -------------------
                                                    Amount   Constant
                                  2009      2008   Reported  Currency
                                  ----      ----   --------  --------
                                             (Unaudited)
  Revenues from Services: (a)
    Americas:
        United States (b)        $409.8    $519.8     -21.2%    -21.2%
        Other Americas            243.5     293.0     -16.9%     -2.3%
                                  -----     -----
                                  653.3     812.8     -19.6%    -14.4%
                                  -----     -----

    France                      1,314.1   1,892.1     -30.5%    -26.8%
    EMEA:
        Italy                     231.0     375.7     -38.5%    -35.3%
        Other EMEA              1,381.8   1,951.7     -29.2%    -21.6%
                                -------   -------
                                1,612.8   2,327.4     -30.7%    -23.8%
                                -------   -------
    Asia Pacific                  427.9     453.6      -5.6%    -10.5%
    Right Management              135.7     108.3      25.4%     29.2%
    Jefferson Wells                48.3      74.2     -34.9%    -34.9%
                                   ----      ----
                               $4,192.1  $5,668.4     -26.0%    -21.5%
                               ========  ========

  Operating Unit Profit:
    Americas:
        United States (b)         $(0.9)    $12.1       N/A       N/A
        Other Americas              5.5       6.5     -16.2%      2.9%
                                    ---       ---
                                    4.6      18.6     -75.7%    -69.0%
                                    ---      ----

    France                         10.6      66.1     -83.9%    -82.7%
    EMEA:
        Italy                       8.6      29.3     -70.4%    -68.3%
        Other EMEA                 17.1      76.3     -77.7%    -76.1%
                                   ----      ----
                                   25.7     105.6     -75.7%    -74.0%
                                   ----     -----
    Asia Pacific                    4.0       8.0     -50.5%    -61.3%
    Right Management               21.2       7.5     181.0%    176.4%
    Jefferson Wells                (0.6)     (1.6)      N/A       N/A
                                   ----      ----
                                   65.5     204.2
  Corporate expenses               23.5      20.1
  Goodwill and intangible
   asset impairment                61.0     163.1
                                   ----     -----
      Operating (loss) profit     (19.0)     21.0       N/A       N/A
  Interest and other expenses (c)  29.3      13.4
                                   ----      ----
      (Loss) earnings before
       income taxes              $(48.3)     $7.6
                                 ======      ====

  (a)  Our segment reporting was realigned during the first quarter of
       2009 due to a change in management structure.  Other Americas and
       Asia Pacific, previously reported in Other Operations, are now
       separate reportable segments.  The United States and Other Americas
       reportable segments are reported as Americas.  The Italy and Other
       EMEA reportable segments are reported as EMEA.  Historical amounts
       have been restated to conform to the current year presentation.

  (b)  In the United States, revenues from services include fees received
       from our franchise offices of $3.0 million and $4.5 million for the
       three months ended September 30, 2009 and 2008, respectively.  These
       fees are primarily based on revenues generated by the franchise
       offices, which were $121.6 million and $175.4 million for the three
       months ended September 30, 2009 and 2008, respectively.

  (c)  The components of interest and other expenses were:


                                  2009      2008
                                  ----      ----
          Interest expense        $21.5     $16.2
          Interest income          (1.7)     (5.4)
          Foreign exchange
           gains                   (0.6)     (0.6)
          Miscellaneous (income)
           expense, net            (0.2)      3.2
          Loss from sale of an
           equity investment       10.3         -
                                   ----       ---
                                  $29.3     $13.4
                                  =====     =====



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

                                   Nine Months Ended September 30
                                   ------------------------------
                                                       % Variance
                                                    -------------------
                                                     Amount   Constant
                                  2009       2008   Reported  Currency
                                  ----       ----   --------  --------
                                            (Unaudited)
  Revenues from services (a)  $11,635.8  $16,959.9    -31.4%    -23.4%

  Cost of services              9,564.0   13,811.0    -30.8%    -22.5%
                                -------   --------

    Gross profit                2,071.8    3,148.9    -34.2%    -27.0%

  Selling and administrative
   expenses, excluding
   impairment charges           2,002.2    2,625.5    -23.7%    -15.5%
  Goodwill and intangible
   asset impairment (b)            61.0      163.1    -62.6%    -62.6%
                                   ----      -----
    Selling and administrative
     expenses                   2,063.2    2,788.6    -26.0%    -18.3%

    Operating profit                8.6      360.3    -97.6%    -94.7%

  Interest and other expenses      52.0       38.6     34.7%
                                   ----       ----

    (Loss) earnings before
     income taxes                 (43.4)     321.7      N/A       N/A

  Provision for income taxes      (14.6)     182.0      N/A
                                  -----      -----

    Net (loss) earnings          $(28.8)    $139.7      N/A       N/A
                                 ======     ======

  Net (loss) earnings per
   share - basic                 $(0.37)     $1.77      N/A
                                 ======      =====

  Net (loss) earnings per
   share - diluted               $(0.37)     $1.75      N/A       N/A
                                 ======      =====

  Weighted average shares -
   basic                           78.3       79.1     -1.0%
                                   ====       ====

  Weighted average shares -
   diluted                         78.3       80.0     -2.1%
                                   ====       ====

  (a)  Revenues from services include fees received from our franchise
       offices of $16.6 million and $23.6 million for the nine months ended
       September 30, 2009 and 2008, respectively.  These fees are primarily
       based on revenues generated by the franchise offices, which were
       $533.3 million and $911.6 million for the nine months ended
       September 30, 2009 and 2008, respectively.

  (b)  The goodwill impairment charge for the nine months ended
       September 30, 2009 relates to our investment in Jefferson
       Wells.  The goodwill and intangible asset impairment charge for the
       nine months ended September 30, 2008 relates to our investment in
       Right Management.  The impact on net earnings is $61.0 million and
       $154.6 million, or $0.78 and $1.93 per diluted share, for the nine
       months ended September 30, 2009 and 2008, respectively.



                               Manpower Inc.
                           Operating Unit Results
                               (In millions)

                                     Nine Months Ended September 30
                                     ------------------------------
                                                           % Variance
                                                       ------------------
                                                        Amount   Constant
                                    2009       2008    Reported  Currency
                                    ----       ----    --------  --------
                                               (Unaudited)
  Revenues from Services: (a)
    Americas:
        United States (b)        $1,157.9   $1,482.9     -21.9%    -21.9%
        Other Americas              683.4      869.9     -21.4%     -5.8%
                                    -----      -----
                                  1,841.3    2,352.8     -21.7%    -16.0%
                                  -------    -------

    France                        3,371.1    5,584.2     -39.6%    -32.9%
    EMEA:
        Italy                       681.5    1,218.3     -44.1%    -37.6%
        Other EMEA                3,903.7    5,856.1     -33.3%    -20.5%
                                  -------    -------
                                  4,585.2    7,074.4     -35.2%    -23.4%
                                  -------    -------
    Asia Pacific                  1,259.3    1,392.5      -9.6%    -10.1%
    Right Management                429.8      328.6      30.8%     39.8%
    Jefferson Wells                 149.1      227.4     -34.4%    -34.4%
                                    -----      -----
                                $11,635.8  $16,959.9     -31.4%    -23.4%
                                =========  =========

  Operating Unit Profit:
    Americas:
        United States (b)          $(21.2)     $34.1       N/A       N/A
        Other Americas               14.2       21.9     -35.3%    -21.8%
                                     ----       ----
                                     (7.0)      56.0       N/A       N/A
                                     ----       ----

    France                           15.8      189.9     -91.7%    -90.8%
    EMEA:
        Italy                        16.8       96.0     -82.5%    -80.8%
        Other EMEA                   14.0      209.1     -93.3%    -91.7%
                                     ----      -----
                                     30.8      305.1     -89.9%    -88.3%
                                     ----      -----
    Asia Pacific                     19.6       30.6     -36.0%    -44.4%
    Right Management                 92.6       27.7     234.1%    246.4%
    Jefferson Wells                 (18.3)      (5.8)      N/A       N/A
                                    -----       ----
                                    133.5      603.5
  Corporate expenses                 63.9       80.1
  Goodwill and intangible
   asset impairment                  61.0      163.1
                                     ----      -----
      Operating profit                8.6      360.3     -97.6%    -94.7%
  Interest and other expenses (c)    52.0       38.6
                                     ----       ----
      (Loss) earnings before
       income taxes                $(43.4)    $321.7
                                   ======     ======


  (a)  Our segment reporting was realigned during the first quarter of 2009
       due to a change in management structure.  Other Americas and Asia
       Pacific, previously reported in Other Operations, are now separate
       reportable segments.  The United States and Other Americas reportable
       segments are reported as Americas.  The Italy and Other EMEA
       reportable segments are reported as EMEA.  Historical amounts have
       been restated to conform to the current year presentation.

  (b)  In the United States, revenues from services include fees received
       from our franchise offices of $7.4 million and $13.8 million for the
       nine months ended September 30, 2009 and 2008, respectively.
       These fees are primarily based on revenues generated by the franchise
       offices, which were $323.7 million and $602.7 million for the nine
       months ended September 30, 2009 and 2008, respectively.

  (c)  The components of interest and other expenses were:


                                     2009       2008
                                     ----       ----
          Interest expense          $48.5      $48.9
          Interest income            (9.3)     (16.5)
          Foreign exchange loss
           (gain)                     0.9       (2.1)
          Miscellaneous expenses,
           net                        1.6        8.3
          Loss from sale of an equity
           investment                10.3          -
                                     ----        ---
                                    $52.0      $38.6
                                    =====      =====



                              Manpower Inc.
                       Consolidated Balance Sheets
                              (In millions)

                                                    Sep. 30   Dec. 31
                                                      2009      2008
                                                      ----      ----
                                                       (Unaudited)
  ASSETS
  Current assets:
    Cash and cash equivalents                      $1,200.6    $874.0
    Accounts receivable, net                        3,158.8   3,629.7
    Prepaid expenses and other assets                 191.5     119.9
    Future income tax benefits                         59.1      66.5
                                                       ----      ----
        Total current assets                        4,610.0   4,690.1

  Other assets:
    Goodwill and other intangible assets, net       1,362.6   1,388.1
    Other assets                                      343.6     326.6
                                                      -----     -----
        Total other assets                          1,706.2   1,714.7

  Property and equipment:
    Land, buildings, leasehold improvements and
     equipment                                        746.2     744.0
    Less:  accumulated depreciation and
     amortization                                     553.0     530.6
                                                      -----     -----
      Net property and equipment                      193.2     213.4
                                                      -----     -----
          Total assets                             $6,509.4  $6,618.2
                                                   ========  ========

  LIABILITIES AND SHAREHOLDERS' EQUITY
  Current liabilities:
    Accounts payable                               $1,007.9    $903.2
    Employee compensation payable                     200.9     213.2
    Accrued liabilities                               515.7     577.9
    Accrued payroll taxes and insurance               550.7     617.5
    Value added taxes payable                         417.7     479.2
    Short-term borrowings and current
     maturities of long-term debt                     177.3     115.6
                                                      -----     -----
        Total current liabilities                   2,870.2   2,906.6

  Other liabilities:
    Long-term debt                                    731.6     837.3
    Other long-term liabilities                       341.4     390.5
                                                      -----     -----
        Total other liabilities                     1,073.0   1,227.8

  Shareholders' equity:
    Common stock                                        1.0       1.0
    Capital in excess of par value                  2,533.6   2,514.8
    Retained earnings                               1,143.5   1,201.2
    Accumulated other comprehensive income (loss)     113.4      (8.9)
    Treasury stock, at cost                        (1,225.3) (1,224.3)
                                                   --------  --------
        Total shareholders' equity                  2,566.2   2,483.8
                                                    -------   -------
          Total liabilities and shareholders'
           equity                                  $6,509.4  $6,618.2
                                                   ========  ========



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

                                                       Nine Months Ended
                                                            Sep. 30
                                                            -------
                                                          2009    2008
                                                          ----    ----
                                                           (Unaudited)
  Cash Flows from Operating Activities:
    Net (loss) earnings                                  $(28.8) $139.7
    Adjustments to reconcile net (loss) earnings to net
     cash provided by operating activities:
        Depreciation and amortization                      72.8    81.9
        Non-cash goodwill and intangible asset
         impairment                                        61.0   163.1
        Deferred income taxes                             (12.1)  (36.8)
        Provision for doubtful accounts                    20.9    14.2
        Loss from sale of an equity investment             10.3       -
        Share-based compensation                           12.5    15.3
        Excess tax benefit on exercise of stock
         options                                           (0.1)   (0.5)
    Changes in operating assets and liabilities, excluding
      the impact of acquisitions:
        Accounts receivable                               648.6    76.8
        Other assets                                      (69.5)  (35.5)
        Other liabilities                                (303.7)   31.0
                                                         ------    ----
              Cash provided by operating activities       411.9   449.2
                                                          -----   -----

  Cash Flows from Investing Activities:
    Capital expenditures                                  (27.0)  (70.6)
    Acquisitions of businesses, net of cash acquired      (21.3) (224.4)
    Proceeds from the sale of an equity investment         13.3       -
    Proceeds from the sale of property and equipment        3.3     4.1
                                                            ---     ---
              Cash used in investing activities           (31.7) (290.9)
                                                          -----  ------

  Cash Flows from Financing Activities:
    Net (repayments) borrowings of short-term
     facilities and long-term debt                        (88.7)   87.4
    Proceeds from share-based awards                        9.7    12.5
    Excess tax benefit on exercise of stock options         0.1     0.5
    Repurchases of common stock                               -  (125.3)
    Dividends paid                                        (29.0)  (29.2)
                                                          -----   -----
              Cash used in financing activities          (107.9)  (54.1)
                                                         ------   -----

  Effect of exchange rate changes on cash                  54.3    (9.7)
                                                           ----    ----
  Change in cash and cash equivalents                     326.6    94.5

  Cash and cash equivalents, beginning of period          874.0   537.5
                                                          -----   -----
  Cash and cash equivalents, end of period             $1,200.6  $632.0
                                                       ========  ======

First Call Analyst:
FCMN Contact: linda.granrose@na.manpower.com

Photo: http://www.newscom.com/cgi-bin/prnh/20060221/CGTU012LOGO
http://photoarchive.ap.org/
PRN Photo Desk, photodesk@prnewswire.com

SOURCE: Manpower Inc.

CONTACT: Mike Van Handel of Manpower Inc., +1-414-906-6305,
michael.vanhandel@manpower.com

Web Site: http://www.manpower.com/


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