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View All NewsManpowerGroup Q4 revenue up 7% in constant currency; names new CFO
ManpowerGroup Inc. (NYSE: MAN) revenue rose 7.3% in constant currency despite falling 3.3% on a reported basis. In France, the company’s largest single market, revenue was up 5.7% in constant currency. US revenue fell 5.2%. The world’s third-largest staffing firm also appointed a new CFO, naming John “Jack” McGinnis to the post.
McGinnis comes to ManpowerGroup from Morgan Stanley, where he served as global controller. Prior to Morgan Stanley, McGinnis was CFO at HSBC North America Holdings Inc.
The new CFO takes on the role effective Feb. 15. Former CFO Michael Van Handel will become senior executive VP. Van Handel had served as CFO since 1998 and will remain with the firm at least through 2016.
Looking at earnings, the strong US dollar impacted revenue relative to several countries. ManpowerGroup also reported a favorable impact from a lower income tax rate thanks to approval of the US Workers Opportunity Tax Credit in December.
| (US$ millions) | Q4 2015 | Q4 2014 | % change | % constant currency |
| Americas | ||||
| United States | $748.5 | $789.5 | -5.2% | -5.2% |
| Other Americas | $391.8 | $383.0 | 2.3% | 23.5% |
| Total Americas | $1,140.3 | $1,172.5 | -2.7% | 4.2% |
Revenue in Germany got a boost from ManpowerGroup’s acquisition of 7S Group. ManpowerGroup also acquired the Greythorn operations in Australia and Singapore this past year.
The company recorded restructuring charges of $16.4 million before taxes in the fourth quarter related to integration and severance costs. The lion’s share of the charges, $9 million, were in Northern Europe.
“As you can tell from our near-term outlook, we do see some softening in some markets, but at this time we don’t see this as the beginning of a broad-based global downturn,” Chairman and CEO Jonas Prising said in a conference call with analysts. “Europe should have a good chance of seeing better economic growth in 2016 than in 2015, according to most economists I speak with. And for the US, there may be some slowing, but not significantly different from where we were last year.”
Revenue by geography
| (US$ millions) | Q4 2015 | Q4 2014 | % change | % constant currency |
| Americas | ||||
| United States | $748.5 | $789.5 | -5.2% | -5.2% |
| Other Americas | $391.8 | $383.0 | 2.3% | 23.5% |
| Total Americas | $1,140.3 | $1,172.5 | -2.7% | 4.2% |
| Southern Europe | ||||
| France | $1,175.4 | $1,267.9 | -7.3% | 5.7% |
| Italy | $312.3 | $296.1 | 5.5% | 20.3% |
| Other Southern Europe | $255.5 | $246.4 | 3.8% | 14.8% |
| Total Southern Europe | $1,743.2 | $1,810.4 | -3.7% | 9.3% |
| Northern Europe | $1,421.0 | $1,501.8 | -5.4% | 5.6% |
| Asia Pacific Middle East | $579.2 | $566.9 | 2.2% | 11.9% |
| Right Management | $70.2 | $69.5 | 1.0% | 7.8% |
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Americas
- US revenue represents the majority of Americas revenue, 66%, and revenue was down 5% in the fourth quarter as reported and in constant currency. Mexico revenue was up 18% in constant currency, and Argentina revenue was up 46% in constant currency.
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Southern Europe
- French revenue rose 6% in constant currency. Italian revenue was up 20% in constant currency. Spanish revenue was up 24% in constant currency.
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Northern Europe
- In the fourth quarter, UK revenue fell 5% in constant currency; Nordics fell 1%. However, Dutch and Belgian revenue both rose 1% in constant currency. German revenue rose 69% in constant currency, but the increase was only 12% on an organic basis.
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Asia Pacific Middle East
- Japanese revenue rose 1% in constant currency in the fourth quarter. Australia/New Zealand revenue rose 30% in constant currency, but was up only 4% on an organic basis.
Full-year revenue
| (US$ millions) | FY 2015 | FY 2014 | % change | % constant currency |
| Revenue | $19,329.9 | $20,762.8 | -6.9% | 6.6% |
| Gross profit | $3,295.8 | $3,488.2 | -5.5% | 7.1% |
| Gross margin | 17.1% | 16.8% | ||
| Net earnings | $419.2 | $427.6 | -2.0% | 12.8% |
Guidance
ManpowerGroup forecasts total revenue to rise 1% to 3% year over year in the first quarter. The increase in constant currency would be 5% to 7%.
It expects a gross margin of 16.7% to 16.9%.
Share price and market cap
Shares in ManpowerGroup fell 0.52% in early afternoon trading to $72.10, according to Yahoo! The company had a market cap of $5.31 billion.