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Manpower takes loss despite revenue increase

October 21 2008

Manpower Inc. (NYSE: MAN) reported a 7.0% increase in third-quarter revenue, including a 3.5% increase in U.S. revenue. However, a goodwill and intangible asset impairment charge related to a 2004 acquisition in its Right Management outplacement division, cut into the bottom line. The company posted a net loss of $43.2 million.

Excluding the charge, Manpower's third-quarter net income would have totaled $111.4 million, down 15.4% year over year.

"The slowdown that we have been experiencing in the U.S. has now moved to Europe," said Chairman and CEO Jeffrey Joerres. "While we are still seeing year-over-year growth in some of our European operations, we expect the full impact of the economic slowdown has yet to be felt by the labor market."

Milwaukee-based Manpower, one of the world's largest staffing firms, reported third-quarter revenue of $5.67 billion, up 7.0% year over year or 1.0% on a constant currency basis.

Third-quarter U.S. revenue was $519.8 million, up 3.5%. Revenue in France, its largest single market, rose 1.1% to $1.89 billion, but was down 7.9% on a constant currency basis.

Third-quarter gross margin slipped to 18.1% from 18.4% in the same period last year.

Manpower posted a third-quarter net loss of $43.2 million compared with net income of $131.7 million in the third quarter of last year. In addition to the Right Management charge of $163.1 million in the latest quarter, the company also said the third quarter of 2007 included a $27.0 million boost from a non-recurring French payroll tax change.

Manpower Inc. (NYSE: MAN)
For the third quarter ended Sept. 30, 2008, compared with the same period in 2007.
Revenue: $5.67 billion, +7.0%
Net loss: $43.2 million vs. net income of $131.7 million

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