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Adecco revenue rises 29%

August 11 2010

Adecco SA, the world's largest staffing firm, announced second-quarter revenue rose 29% from the year-ago quarter to euro4.65 billion (US$5.67 billion) as business conditions continued to improve.

Second-quarter revenue was still up 13% on an organic basis -- excluding the effects of currency and acquisitions, including Adecco's acquisition on Jan. 19 of MPS Group Inc. Last year MPS had ranked as the 13th largest U.S. staffing firm.

"We delivered strong growth in our main markets, France and North America," CEO Patrick De Maeseneire said. "Also Germany, Italy, Nordics and the emerging markets posted strong double-digit revenue growth. Demand was particularly strong in the industrial segment, but also our professional staffing business returned to growth in the second quarter."

There's no evidence of a slowdown, De Maeseneire said, adding that revenue rose 16% on an organic basis in June.

Adecco's North America second-quarter revenue rose 60% on a year-over-year basis to euro925.0 million (US$1.13 billion). Revenue rose 15% on an organic basis, which excludes the effects of currency, acquisitions and disposals.

Second-quarter North American engineering and technical revenue rose 43% on an organic basis. North American IT revenue fell 7% organically and finance and legal revenue rose 2% organically. Total North American revenue rose 21% on an organic basis when also excluding Adecco's outplacement business.

Adecco's second-quarter gross margin of 17.8% was unchanged from the same period last year. However, gross margin fell 110 basis points on an organic basis and when also adjusting for a change in the French business tax.

The company posted net income of euro97.0 million (US$118.4 million) compared with a net loss of euro147.0 million in the second quarter of last year.

CFO Dominik de Daniel in a conference call with analysts also updated investors on the integration of MPS, saying it is on track and decisions have been made on brand names.

"Our combined U.S. legal business will operate under the brand name Special Counsel," de Daniel said. "Our combined finance and accounting business will operate under the brand name Accounting Principals and our combined IT business will operate under the brand name Modis."

Adecco SA
For the second quarter ended June 30, 2010, compared with the same period in 2009.
Revenue: euro4.65 billion (US$5.67 billion), +29%
Net income: euro97.0 million (US$118.4 million) vs. a net loss of euro147.0 million

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