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View All NewsKelly’s Q3 revenue rises 5.3% in constant currency; EMEA revenue up 10.7%
Kelly Services Inc.’s (NASD: KELYA) third-quarter revenue rose 5.3% on a constant currency basis. Growth was fastest in the Europe, Middle East and Africa region, where revenue rose 10.7% in constant currency.
| (US$ millions) | Q3 2017 | Q3 2016 | % change | % constant currency |
| Revenue | $1,328.8 | $1,247.8 | 6.5% | 5.3% |
| Gross profit | $230.7 | $215.1 | 7.3% | 6.2% |
| Gross margin | 17.4% | 17.2% | ||
| Net earnings | $23.0 | $80.9 | -71.5% |
EMEA countries with the fastest growth included the UK, “other” EMEA countries and France. On the flip side, revenue edged up only 2.5% in Norway, 2.6% Ireland and 3.0% in Germany — all on a constant currency basis.
Net earnings fell 71.5%. During the third quarter of 2016, Kelly transferred its APAC staffing operations to the TS Kelly Asia Pacific joint venture and recorded a pre-tax gain of $87.2 million. Kelly retains a 49% ownership interest in the joint venture.
Quote
“Our third quarter performance confirmed that we are continuing to drive top-line growth and shareholder value, even as we invest in talent, technology, and solutions to accelerate our progress,” President and CEO George Corona said. “Our acquisition of Teachers On Call and our decision to implement a digital talent platform confirm that we are not content to stop at short-term growth, and we are strategically positioning Kelly for long-term success as the world of work evolves."
Revenue by segment
| (US$ millions) | Q3 2017 | Q3 2016 | % change | % constant currency |
| Americas staffing | $554.8 | $518.2 | 7.1% | 6.6% |
| Global talent solutions | $503.0 | $495.0 | 1.6% | 1.3% |
| International staffing | $275.6 | $239.3 | 15.2% | 10.4% |
Gross margin by segment
| Q3 2017 | Q3 2016 | |
| Americas staffing | 17.8% | 18.3% |
| Global talent solutions | 18.5% | 17.4% |
| International staffing | 14.3% | 14.7% |
Revenue by geography
| (US$ millions) | Q3 2017 | Q3 2016 | % change | % constant currency |
| Americas | ||||
| United States | $941.1 | $900.3 | 4.5% | 4.5% |
| Canada | $37.1 | $34.9 | 6.2% | 1.9% |
| Mexico | $32.9 | $27.6 | 19.4% | 13.3% |
| Puerto Rico | $15.9 | $20.9 | -23.8% | -23.8% |
| Brazil | $12.3 | $13.3 | -7.4% | -9.4% |
| Europe, Middle East and Africa | ||||
| France | $73.0 | $60.8 | 20.1% | 14.1% |
| Switzerland | $59.1 | $55.0 | 7.4% | 6.0% |
| Portugal | $46.0 | $39.2 | 17.5% | 11.6% |
| United Kingdom | $23.3 | $19.5 | 19.1% | 19.5% |
| Russia | $22.5 | $18.4 | 22.4% | 11.6% |
| Italy | $15.9 | $13.6 | 17.1% | 11.1% |
| Germany | $15.5 | $14.2 | 8.5% | 3.0% |
| Norway | $8.9 | $8.4 | 7.2% | 2.5% |
| Ireland | $8.3 | $7.7 | 8.1% | 2.6% |
| Other EMEA | $12.1 | $9.7 | 25.0% | 18.4% |
| Asia Pacific | ||||
| Total APAC | $4.9 | $4.3 | 12.6% | 8.8% |
Guidance
Kelly Services forecasts revenue to rise between 8% and 9% year over year in the fourth quarter.
Share price and market cap
Shares in Kelly Services rose 5.37% to $27.65 as of 2:01 p.m. Eastern time. The company had a market cap of $1.047 billion.