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View All NewsWorld – ManpowerGroup Q1 revenue up 5% in constant currency but US revenue down 7%
First-quarter revenue at ManpowerGroup Inc. (NYSE: MAN) rose 16.1% year over year with a boost from foreign currencies relative to the US dollar; revenue was up 5.4% in constant currency.
The staffing giant also reported US revenue fell 6.8% year over year. The only other segment where revenue fell was Right Management; the outplacement provider posted a 15.1% decline in revenue on a constant currency basis.
| (US$ millions) | Q1 2018 | Q1 2017 | % change | % constant currency |
| Revenue | $5,522.4 | $4,757.2 | 16.1% | 5.4% |
| Gross profit | $885.4 | $787.8 | 12.4% | 2.8% |
| Gross margin | 16.0% | 16.6% | ||
| Net earnings | $97.0 | $74.4 | 30.4% | 18.2% |
The company noted restructuring costs of $24 million in the quarter. Restructuring costs in Northern Europe related to delivery model and other front office centralization initiatives as well back office optimization activities in the UK, Germany, the Netherlands, Norway and Belgium.
In addition, first-quarter gross margin narrowed at 16% with a margin decline of 0.5% in the staffing business offset by a number of SG&A efficiencies. Gross profit rose 16%, or 9% on a constant currency basis, in ManpowerGroup’s Solutions business, which includes MSP and RPO operations.
Revenue by Geography was as follows.
| (US$ millions) | Q1 2018 | Q1 2017 | % change | % constant currency | |
| Americas | |||||
| United States | $616.3 | $661.5 | -6.8% | -6.8% | |
| Other Americas | $406.3 | $364.7 | 11.4% | 10.6% | |
| Total Americas | $1,022.6 | $1,026.2 | -0.3% | -0.6% | |
| Southern Europe | |||||
| France | $1,424.0 | $1,137.5 | 25.2% | 8.5% | |
| Italy | $413.6 | $294.4 | 40.5% | 21.8% | |
| Other Southern Europe | $474.4 | $372.0 | 27.5% | 12.3% | |
| Total Southern Europe | $2,312.0 | $1,803.9 | 28.2% | 11.5% | |
| Northern Europe | $1,417.6 | $1,238.7 | 14.4% | 1.2% | |
| Asia Pacific Middle East | $720.2 | $632.4 | 13.9% | 8.2% | |
| Right Management | $50.0 | $56.0 | -10.6% | -15.1% | |
UK revenues were down 1% in constant currency and were flat on a billing days adjusted basis which is an improvement from the 3% decline in the fourth quarter. However, it has been reported elsewhere that Manpower UK is a major casualty of the decision by Jaguar Land Rover last week to shed 1,000 agency workers.
“We are pleased with the solid start to the year, with strong revenue growth, improved productivity and increased earnings,” Chairman and CEO Jonas Prising said. “We are seeing broad-based demand globally for our services and workforce solutions.”
ManpowerGroup forecast that second-quarter revenue will increase 13% to 15% — or 5% to 7% on a constant currency basis. Forecasts for year-over-year change in revenue in other regions included:
- Americas: Flat to up 2% (up 1% to 3% in constant currency)
- Southern Europe: Up 20% to 22% (up 8% to 10% in constant currency)
- Northern Europe: Up 14% to 16% (up 3% to 5% in constant currency)
- Asia Pacific, Middle East: Up 11% to 13% (up 6% to 8% in constant currency)
- Right Management: Down 3% to 5% (down 7% to 9% in constant currency)
On Friday, ManpowerGroup Inc (MAN:NYQ) closed at 101.47 down 14.49% on the day, and 3.67% above its 52-week low of $97.88, set on 21 April 2017. Based on its current share price the company has a market value of $6.71 billion.