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View All NewsWorld – ManpowerGroup reports improving European labour markets in Q2, revenue up 5% in constant currency
ManpowerGroup Inc. (NYSE: MAN) reported improving market conditions across several geographies during the second quarter with France, Italy, Mexico and Poland leading the way. The strength in Europe is helping to offset revenue declines in both UK and the US.
Total second-quarter revenue at the company, one of the world’s largest staffing providers, rose 5.6% in constant currency.
ManpowerGroup announced results were impacted by a stronger US dollar during the second quarter, and the company reported restructuring charges.
| (USD millions) | Q2 2017 | Q2 2016 | % growth | % constant currency | Q2 2017 (€ millions) |
| Revenue | 5,174.8 | 5,022.1 | 3.0% | 5.6% | 4,535.1 |
| Gross profit | 861.7 | 860.7 | 0.1% | 2.5% | 755.2 |
| Gross margin | 16.7% | 17.1% | |||
| Net earnings | 117.0 | 115.4 | 1.4% | 3.4% | 102.5 |
French revenue rose 11.0% in constant currency; the country is ManpowerGroup’s largest single market. Meanwhile, Italian revenue increased 25.2% in constant currency, and Mexican revenue jumped 14%. Meanwhile, Northern European revenue rose, although UK revenue fell 10% in constant currency.
Revenue by geography was broken down as follows:
| (USD millions) | Q2 2017 | Q2 2016 | % growth | % constant currency | Q1 2017 (in euros) |
| Americas | |||||
| United States | 671.3 | 725.3 | -7.4% | -7.4% | 588.3 |
| Other Americas | 385.6 | 355.7 | 8.3% | 10.6% | 337.9 |
| Total Americas | 1,056.9 | 1,081.0 | -2.2% | -1.5% | 926.2 |
| Southern Europe | |||||
| France | 1,356.3 | 1,252.2 | 8.3% | 11.0% | 1,188.6 |
| Italy | 366.5 | 299.8 | 22.2% | 25.2% | 321.2 |
| Other Southern Europe | 412.9 | 379.4 | 8.8% | 9.7% | 361.9 |
| Total Southern Europe | 2,135.7 | 1,931.4 | 10.6% | 12.9% | 1,871.7 |
| Northern Europe | 1,281.7 | 1,322.3 | -3.1% | 2.3% | 1,123.3 |
| Asia Pacific Middle East | 643.4 | 614.6 | 4.7% | 5.2% | 563.9 |
| Right Management | 57.1 | 72.8 | -21.6% | -19.8% | 50.0 |
Revenue in the United Kingdom was down 10% in constant currency when compared to the previous year. Meanwhile, revenue was up in constant currency for Germany (10%), the Nordics (7%), Netherlands (18%), Belgium (3%) and Other (7%).
Gross margin narrowed to 16.7% from 17.1%.
The company’s Right Management segment, which provides outplacement, reported gross profit fell 22% in constant currency.
ManpowerGroup Solutions, which includes the company’s recruitment process outsourcing offering and its TAPFIN managed service provider offering among other things reported gross profit rose 6% in constant currency.
“We are pleased with our strong second quarter results,” Chairman and CEO Jonas Prising said. “The labour markets continue to improve in Europe and across the globe, which is a good foundation for continued profitable growth as we head into the second part of 2017. The improving market conditions were spread across the geographies where we operate, and revenue growth was strong in a number of our countries.”
ManpowerGroup forecast third-quarter revenue to range from up 5% to 7% on a year-over-year basis. In constant currency, the company expects revenue to increase between 4% and 6%.
Third-quarter revenue guidance by region:
Americas, down 2% to 4% (down 2% to 4% in constant currency)
Southern Europe, up 12% to 14% (up 10% to 12% in constant currency)
Northern Europe, up 2% to 4% (up 1% to 3% in constant currency)
Asia Pacific Middle East, up 2% to 4% (up 5% to 7% in constant currency)
Right Management, down 16% to 18% (down 16% to 18% in constant currency)
In trading yesterday ManpowerGroup Inc shares closed at USD 108.18, down 8.96% on the day and 9.54% below its 52-week high of USD 119.59, set on 20 July 2017. Based on its current share price the company has a market value of USD 7.26 billion.