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View All NewsKelly Services revenue rises 4%
Kelly Services Inc. (NASD: KELYA), the fifth-largest US staffing firm and seventh-largest global staffing firm, reported revenue rose 3.8 percent in the third quarter to almost $1.40 billion.
Revenue in Kelly’s Outsourcing and Consulting Group rose 10.7 percent, or 10.9 percent in constant currency, to $149.8 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.
Gross margin edged down to 16.1 percent in the third quarter from 16.4 percent in the year-ago quarter.
Net earnings fell to $1.4 million from $18.8 million. The third quarter included restructuring charges of $4.0 million. The third quarter of last year included restructuring charges of $500,000.
Kelly last week announced a management simplification restructuring plan to close approximately 50 US branches and cut global headcount by 100 permanent positions, including several leadership positions. Subsequently, Senior VP and Chief Innovation Officer Rolf Kleiner resigned from the company and Michael Webster, executive VP and general manager, Americas and global solutions, will retire at the end of the year.
Quote
“We’re pleased with our third quarter performance,” said President and CEO Carl Camden. “2014 has been a year of aggressive strategic investments at Kelly, and we’re seeing early signs that those investments are gaining traction. We are now a leaner, more efficient company that is focused on growth and well-aligned with market demands for high-margin specialty staffing and holistic talent supply chain solutions.”
Revenue
| Q3 2014 ($millions) | Q3 2013 ($millions) | % growth | |
| Revenue | $1,396.4 | $1,345.6 | 3.8% |
Revenue by segment
| Q3 2014 ($millions) | Q3 2013 ($millions) | % growth | % constant currency | |
| Americas Commercial | $640.8 | $617.0 | 3.9% | 4.3% |
| Americas Professional & Technical | $242.5 | $239.9 | 1.1% | 1.2% |
| EMEA Commerical | $231.3 | $224.5 | 3.0% | 3.2% |
| EMEA Professional & Technical | $48.1 | $45.1 | 6.5% | 6.0% |
| APAC Commerical | $91.0 | $87.6 | 3.9% | 2.2% |
| APAC Professional & Technical | $10.6 | $9.1 | 15.8% | 14.4% |
| OCG* | $149.8 | $135.3 | 10.7% | 10.9% |
*Services in Kelly's Outsourcing and Consulting Group (OCG) include contingent workforce outsourcing, business process outsourcing, recruitment process outsourcing, independent contractor solutions, payroll process outsourcing, career transition and executive coaching and development, and executive search.
Revenue by geography
| Q3 2014 ($millions) | Q3 2013 ($millions) | % growth | % constant currency | |
| Americas | ||||
| United States | $873.7 | $843.5 | 3.6% | 3.6% |
| Canada | $51.9 | $52.9 | -1.9% | 2.6% |
| Mexico | $37.0 | $33.1 | 11.8% | 13.6% |
| Puerto Rico | $25.7 | $24.4 | 5.1% | 5.1% |
| Brazil | $13.6 | $13.1 | 3.7% | 3.2% |
| Europe, Middle East and Africa | ||||
| France | $70.1 | $62.4 | 12.4% | 12.0% |
| Switzerland | $66.7 | $68.6 | -2.7% | -4.7% |
| Portugal | $33.3 | $24.1 | 38.0% | 37.8% |
| Russia | $28.7 | $32.9 | -13.0% | -3.9% |
| United Kingdom | $26.2 | $26.5 | -1.1% | -8.4% |
| Germany | $17.5 | $17.4 | 0.6% | 0.6% |
| Norway | $14.8 | $16.1 | -7.7% | -3.8% |
| Italy | $14.8 | $13.8 | 6.7% | 6.7% |
| Other EMEA | $15.8 | $16.0 | -1.0% | -0.3% |
| Asia Pacific | ||||
| Singapore | $33.4 | $29.4 | 13.7% | 12.2% |
| Australia | $32.3 | $32.4 | -0.2% | -1.3% |
| Malaysia | $16.7 | $17.2 | -3.0% | -4.5% |
| New Zealand | $12.7 | $12.6 | 0.4% | -5.1% |
| Other Asia Pacific | $11.5 | $9.2 | 25.1% | 26.2% |
Gross margin
| Q3 2014 | Q3 2013 | |
| Gross margin | 16.1% | 16.4% |
Gross margin by segment
| Q3 2014 | Q3 2013 | |
| Americas Commercial | 14.3% | 14.1% |
| Americas Professional & Technical | 16.3% | 16.2% |
| EMEA Commerical | 14.5% | 15.1% |
| EMEA Professional & Technical | 22.6% | 23.9% |
| APAC Commerical | 12.8% | 14.5% |
| APAC Professional & Technical | 31.5% | 37.5% |
| OCG* | 23.9% | 25.7% |
*Services in Kelly's Outsourcing and Consulting Group (OCG) include contingent workforce outsourcing, business process outsourcing, recruitment process outsourcing, independent contractor solutions, payroll process outsourcing, career transition and executive coaching and development, and executive search.
Net earnings
| Q3 2014 ($millions) | Q3 2013 ($millions) | % growth | |
| Net earnings | $1.4 | $18.8 | -93.0% |
Share price and market cap
Kelly Services shares fell 11.10 percent to $15.37 in early afternoon trading. The Troy, Mich.-based staffing firm had a market cap of $577.62 million, according to Yahoo!