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View All NewsManpowerGroup revenue up 1% in constant currency calls out softening market environment in Q3
ManpowerGroup (NYSE: MAN) cited a softening market environment, especially in Europe, in its third-quarter results released today. Total revenue at the Milwaukee-based staffing giant rose 1.3% on a constant currency basis despite being down 0.8% on a reported basis. Gross margin narrowed, but net earnings rose.
Revenue in France, the company’s single largest market, was down 0.6% in constant currency.
In the US, revenue fell 4.0%; however, the year-over-year decline was down from 4.6% in the second quarter and 6.8% in the first.
| (US$ millions) | Q3 2018 | Q3 2017 | % change | % constant currency |
| Revenue | $5,418.7 | $5,464.8 | -0.8% | 1.3% |
| Gross profit | $890.6 | $900.6 | -1.1% | 1.0% |
| Gross margin | 16.4% | 16.5% | ||
| Net earnings | $158.0 | $137.7 | 14.7% | 16.6% |
Third-quarter revenue also fell 3.9% on a constant-currency basis in the company’s Northern Europe segment, which includes the UK, Germany, the Netherlands and elsewhere.
ManpowerGroup noted that it expects a challenging environment in Europe for the fourth quarter.
Revenue by geography
| (US$ millions) | Q3 2018 | Q3 2017 | % change | % constant currency |
| Americas | ||||
| United States | $633.2 | $659.9 | -4.0% | -4.0% |
| Other Americas | $406.8 | $401.6 | 1.3% | 11.7% |
| Total Americas | $1,040.0 | $1,061.5 | -2.0% | 1.9% |
| Southern Europe | ||||
| France | $1,460.6 | $1,481.7 | -1.4% | -0.6% |
| Italy | $410.2 | $386.1 | 6.3% | 7.2% |
| Other Southern Europe | $460.8 | $450.6 | 2.2% | 4.3% |
| Total Southern Europe | $2,331.6 | $2,318.4 | 0.6% | 1.7% |
| Northern Europe | $1,287.1 | $1,367.9 | -5.9% | -3.9% |
| Asia Pacific Middle East | $713.0 | $665.4 | 7.2% | 10.3% |
| Right Management | $47.0 | $51.6 | -8.9% | -7.5% |
At ManpowerGroup Solutions, which provides RPO and MSP, gross profit was up 8% in constant currency. Gross profit fell 8% in constant currency at Right Management.
Quote
“Our third quarter results reflect a more challenging economic environment than we had anticipated, in particular for some countries in Europe,” said Chairman and CEO Jonas Prising. “While we are cautious on our outlook, we are confident in our ability to manage in a more uncertain environment.”
Guidance
ManpowerGroup expects fourth-quarter revenue to range from down 1% to up 1% in constant currency.
Guidance by geography (in constant currency):
- Americas: up 1% to 3%
- Southern Europe: flat to up 2%
- Northern Europe: down 3% to 5%
- Asia Pacific Middle East: up 3% to 5%
- Right Management: down 6% to 8%
Share price and market cap
Shares in ManpowerGroup were down 4.56% at 1:09 p.m. Eastern time to $74.78. The company had a market cap of $4.85 billion.