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View All NewsManpowerGroup global Q3 revenue up 2%; US revenue falls
ManpowerGroup Inc. (NYSE: MAN) reported global revenue rose 2.3% in the third quarter — an increase of 3.8% in constant currency — exceeding its forecast despite declines in the US, Italy and the Right Management division.
| (US$ millions) | Q3 2016 | Q3 2015 | % growth | % constant currency |
| Revenue | $5,088.2 | $4,972.5 | 2.3% | 3.8% |
| Gross profit | $858.3 | $852.1 | 0.7% | 1.9% |
| Gross margin | 16.9% | 17.1% | ||
| Net earnings | $129.2 | $123.9 | 4.3% | 6.0% |
Revenue rose 2.5% in constant currency in France, ManpowerGroup’s largest market. And the Brexit vote did not yet have a significant impact on the company’s UK business in the third quarter, Chairman and CEO Jonas Prising said in a conference call with analysts.
However, US revenue fell 6.0%
Revenue by geography
| (US$ millions) | Q3 2016 | Q3 2015 | % growth | % constant currency |
| Americas | ||||
| United States | $723.7 | $769.6 | -6.0% | -6.0% |
| Other Americas | $383.7 | $367.0 | 4.5% | 15.7% |
| Total Americas | $1,107.4 | $1,136.6 | -2.6% | 1.0% |
| Southern Europe | ||||
| France | $1,277.8 | $1,242.5 | 2.8% | 2.5% |
| Italy | $299.0 | $324.4 | -7.8% | -8.1% |
| Other Southern Europe | $389.5 | $364.4 | 6.9% | 6.6% |
| Total Southern Europe | $1,966.3 | $1,931.3 | 1.8% | 1.5% |
| Northern Europe | $1,300.1 | $1,267.5 | 2.6% | 8.8% |
| Asia Pacific Middle East | $650.9 | $570.2 | 14.1% | 6.5% |
| Right Management | $63.5 | $66.9 | -5.0% | -3.7% |
Currency negatively impacted revenue by 2%, and acquisitions contributed about 2% to the company growth rate in the quarter, CFO Jack McGinnis said in a conference call with analysts. As a result, organic growth on a constant currency basis was 2% in the third quarter.
Revenue’s exceeding of guidance was largely driven by better-than-expected revenue growth in Northern and Southern Europe, McGinnis said.
Quote
“While the market conditions remain mixed, I'm encouraged to see slightly better revenue performance than what we expected across a number of markets around the world,” Chairman and CEO Jonas Prising said in a conference call with analysts. “We remain in a slow-growth environment, one in which we are very well-positioned to take advantage of the many opportunities our clients are presenting to us.”
Guidance
ManpowerGroup forecast fourth-quarter revenue to range from flat to rising 2%. In constant currency, the company expects revenue to increase from 1% to 3%. Fourth-quarter revenue guidance by region:
- Americas, down 4% to 6% (down 1% to up 1% in constant currency)
- Southern Europe, up 3% to 5% (up 1% to 3% in constant currency)
- Northern Europe, down 3% to 5% (up 2% to 4% in constant currency)
- Asia Pacific Middle East, up 13% to 15% (up 4% to 6% in constant currency)
- Right Management, down 5% to 7% (down 4% to 6% in constant currency)
Fourth-quarter gross margin is forecast to be between 16.8% and 17.0%.
Share price and market cap
Shares in ManpowerGroup rose 9.16% in early afternoon trading to $79.59; the company had a market cap of $5.45 billion, according to Yahoo.