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View All NewsWorld – ManpowerGroup revenue growth slows in Q2
Second-quarter revenue at ManpowerGroup rose 3.3% compared to the same time last year. In constant currency, revenue was up 4.5%. Revenue was flat on an organic constant currency basis compared with 2% growth in the prior period.
In France, the company’s largest market, revenue rose by 4.1%, or 2.2% in constant currency. Revenue rose in most of Europe, but Italy was an exception. Second-quarter revenue there fell 6.1%, or 7.8% in constant currency.
In Asia Pacific and the Middle East, second-quarter revenue rose 10.4%, or 9.6% in constant currency.
Second-quarter gross margin was flat at 17.1% though the temporary gross margin declined by three basis points.
| USD (millions) | Q2 2016 | Q2 2015 | % change | % constant currency |
| Revenue | USD 5,022.1 | USD 4,861.3 | 3.3% | 4.5% |
| Gross profit | USD 860.7 | USD 830.6 | 3.6% | 4.5% |
| Gross margin | 17.1% | 17.1% | ||
| Net earnings | USD 115.4 | USD 105.7 | 9.1% | 10.2% |
Despite the softness in revenue growth, financial analysts were pleased with the company’s improvement in profitability, supported by share repurchases.
Financial results in the quarter were impacted by the stronger US dollar relative to several foreign currencies compared to the prior year period.
“We are pleased with our second-quarter results, contributing to a good first half of 2016,” ManpowerGroup Chairman and CEO Jonas Prising said. “We were able to deliver solid results despite a softening and more uncertain global economic growth environment.”
Revenue by Geography
| (USD millions) | Q2 2016 | Q2 2015 | % change | % constant currency |
| Americas | ||||
| United States | USD 725.3 | USD 762.6 | (-4.9%) | -4.9% |
| Other Americas | USD 355.7 | USD 368.1 | (3.3%) | (14.2%) |
| Total Americas | USD 1,081.0 | USD 1,130.7 | -4.4% | 1.3% |
| Southern Europe | ||||
| France | USD 1,252.2 | USD 1,202.6 | 4.1% | 2.2% |
| Italy | USD 299.8 | USD 319.3 | -6.1% | -7.8% |
| Other Southern Europe | USD 379.4 | USD 348.1 | 9.0% | 7.4% |
| Total Southern Europe | USD 1,931.4 | USD 1,870.0 | 3.3% | 1.4% |
| Northern Europe | USD 1,322.3 | USD 1,231.8 | 7.3% | 10.0% |
| Asia Pacific Middle East (APME) | USD 614.6 | USD 556.6 | 10.4% | 9.6% |
| Right Management | USD 72.8 | USD 72.2 | 0.9% | 2.6% |
Results were mixed in Northern Europe. The UK saw a revenue decline of 1% in constant currency while the Netherlands increased by 20%. Germany and Belgium benefited from acquisitive growth during the period but, on an organic constant currency basis, still grew by 8% and 15% respectively.
Looking to the future, ManpowerGroup forecast third-quarter revenue growth to fall within a range of 1% and 3% in constant currency. Most regions are expected to perform at a similar pace to Q2 with the exception of Northern Europe and APME where growth is expected to ease further.
Gross margin in Q3 is forecast to be between 16.9% and 17.1%.
In trading yesterday, shares in ManpowerGroup rose 2.38% to USD 70.51. Based on its share price, the company had a market cap value of USD 5.05 billion.