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Europe — Manpower suggest cyclical and secular recovery is underway

22 April 2010

Manpower Inc. (MAN:NYQ), the world's third largest staffing firm, has reported first quarter results for the three months ended 31 March 2010. Global revenues were up by +12.5% from $3.64 billion in Q1 2009 to $4.09 billion in Q1 2010. In constant currency revenues were up by +5.1%.

Operating profits were up from $1.4 million in Q1 2009 to $32.6 million in Q1 2010. Net earnings were up from a loss of $1.8 million in Q1 2009 to a profit of $2.8 million in Q1 2010.


In France (27% of revenues) revenues were up by +15.7% from $956.9 million in Q1 2009 to $1.1 billion in Q1 2010. In constant currency revenues were up by +9.3%. Operating profits were down by -83.9% from $1 million in Q1 2009 to $0.2 million in Q1 2010. In constant currency operating profits were down by -69.7%. Q1 2009 results in France included non-recurring items such as organisational charges giving a net benefit of $3.2 billion while Q1 2010 was affected by a reclassification of French business tax to provision for income taxes.

In other EMEA countries (39% of revenues) revenues were up by +9.1% from $1.48 billion in Q1 2009 to $1.61 billion in Q1 2010. In constant currency revenues were up by +0.4%. Operating profits were up from a loss of $2 million in Q1 2009 to a profit of $23.6 million in Q1 2010.

In Italy (15% of EMEA) revenues were up by +6.3% from $220.4 million in Q1 2009 to $234.2 billion in Q1 2010. In constant currency revenues were up by +0.4%. Operating profits were up by +386.1% from $1.4 million in Q1 2009 to $6.8 million in Q1 2010. In constant currency operating profits were up by +362.9%.

In the Nordic countries (14% of EMEA), revenues were up by +4%. In constant currency revenues were down by -10%.

In the UK (11% of EMEA) Manpower returned to revenue growth with an improvement of +9%. In constant currency revenues were up by +1%.

In Germany (10% of EMEA), revenues were up by +12%. In constant currency revenues were up by +6%.

The Dutch market remains weak. In The Netherlands (9% of EMEA), revenues were down by -4%. In constant currency revenues were down by -10%.

In Belgium (5% of EMEA), revenues were up by +5%. In constant currency revenues were down by -1%.

Revenues at Elan (13% of EMEA), the IT&T recruitment consultancy which operates in 17 EMEA countries, revenues were down by -5%. In constant currency revenues were down by -13%.

Jeffrey A. Joerres, Manpower Inc. Chairman and Chief Executive Officer, said, " We were able to exceed our anticipated revenue plans while we effectively managed our expenses. In all major geographies we are experiencing strong cyclical trends and even stronger secular trends as companies need to respond to the increased demand but want to remain agile." Interestingly, Mr Joerres suggests that, “the number of jobs growing in the temporary help industry is extremely disproportionate.....compared to previous cyclesâ€Â?.

He goes on to say that, "Our major geographies, the U.S., France, Germany, U.K. and others, all have stronger revenue trajectories exiting the first quarter." Revenue growth is forecast to accelerate by 14%-16% in France and 10%-12% in EMEA (both in constant currency).

The announcement concludes "We anticipate that favourable economic trends will continue into the second quarter, resulting in earnings per share of 14% to 22%. This includes a negative impact of 10% per share related to the COMSYS acquisition."

After publication Manpower's shares were up by +3.59% to US$61.61.

 

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