Daily News

View All News

Kelly Services revenue rises 1%, gross margin improves

May 07, 2014

Kelly Services Inc. (NASD: KELYA), one of the world’s largest staffing firms, reported revenue rose 1.2 percent in the first quarter to $1.33 billion. Americas commercial revenue, Kelly’s largest single segment, fell 3.9 percent to $613.2 million.

However, first-quarter revenue in Kelly’s Outsourcing and Consulting Group (OCG)* rose 25.1 percent to $134.4 million.

Gross margin improved to 16.7 percent in the first quarter from 16.5 percent in the year-ago quarter.

Net earnings fell 80.5 percent to $2.5 million.

*OCG includes contingent workforce outsourcing, business process outsourcing, recruitment process outsourcing, independent contractor solutions, payroll process outsourcing, career transition and executive coaching and development, and executive search.

Quote

Although confidence is returning among many U.S. companies, that isn't necessarily translating into strong job growth, Kelly President and CEO Carl Camden noted. “Rather than waiting for the job market to change significantly in 2014, Kelly is taking the necessary steps to secure our position in the specialty staffing and outsourcing and consulting markets. In particular, we continue to see strong demand and revenue growth in the talent supply chain management approach delivered through our OCG segment.”

Revenue

  Q1 2014 ($millions) Q1 2013 ($millions) % growth
Revenue $1,330.8 $1,314.8 1.2%

Revenue by segment

  Q1 2014 ($millions) Q1 2013 ($millions) % growth % constant currency
Americas Commercial $613.2 $638.3 -3.9% -2.7%
Americas Professional & Technical $236.4 $242.6 -2.6% -2.4%
EMEA Commerical $221.9 $201.0 10.4% 9.6%
EMEA Professional & Technical $47.7 $43.5 9.6% 6.9%
APAC Commerical $83.0 $81.5 1.8% 9.3%
APAC Professional & Technical $8.6 $10.2 -15.3% -7.2%
OCG* $134.4 $107.4 25.1% 25.9%
         
*Services in Kelly's Outsourcing and Consulting Group (OCG) include contingent workforce outsourcing, business process outsourcing, recruitment process outsourcing, independent contractor solutions, payroll process outsourcing, career transition and executive coaching and development, and executive search.

Revenue by geography

  Q1 2014 ($millions) Q1 2013 ($millions) % growth % constant currency
Americas        
United States $839.9 $839.5 0.0% 0.0%
Canada $46.7 $56.0 -16.6% -8.9%
Mexico $30.7 $30.4 0.8% 5.6%
Puerto Rico $25.1 $23.1 8.5% 8.5%
Brazil $15.9 $18.5 -13.9% 0.0%
         
Europe, Middle East and Africa        
France $62.8 $57.3 9.7% 5.6%
Switzerland $62.3 $53.4 16.6% 11.8%
Russia $34.9 $34.5 1.2% 16.6%
United Kingdom $27.8 $25.8 7.7% 1.0%
Portugal $26.6 $17.8 49.8% 43.6%
Germany $16.7 $16.0 4.2% 0.3%
Italy  $14.9 $15.1 -1.3% -5.0%
Norway $14.4 $14.8 -3.1% 4.7%
Other Europe, Middle East and Africa $17.1 $17.4 -1.6% -4.6%
         
Asia Pacific        
Singapore $30.3 $26.1 16.1% 19.0%
Australia $26.5 $32.7 -19.0% -6.3%
Malaysia $16.5 $16.7 -0.7% 6.2%
New Zealand $12.3 $11.5 7.4% 7.2%
Other Asia Pacific $9.4 $8.2 14.7% 31.4%

Gross margin

  Q1 2014  Q1 2013 
Gross margin 16.7% 16.5%

Gross margin by segment

  Q1 2014  Q1 2013 
Americas Commercial 15.0% 14.7%
Americas Professional & Technical 16.8% 15.8%
EMEA Commerical 14.8% 15.5%
EMEA Professional & Technical 23.3% 24.6%
APAC Commerical 14.8% 14.2%
APAC Professional & Technical 32.0% 32.5%
OCG* 24.3% 27.2%
     
*Services in Kelly's Outsourcing and Consulting Group (OCG) include contingent workforce outsourcing, business process outsourcing, recruitment process outsourcing, independent contractor solutions, payroll process outsourcing, career transition and executive coaching and development, and executive search.

Net earnings

  Q1 2014 ($millions) Q1 2013 ($millions) % growth
Net earnings $2.5 $12.9 -80.5%

Share price and market cap

Kelly Services shares fell 6.24 percent to $19.55 in early afternoon trading. The Troy, Mich.-based staffing firm had a market cap of $731.51 million, according to Yahoo!