MANPOWERGROUP INC. 
By MILWAUKEE, Jan. 30, 2013 /PRNewswire/ -- ManpowerGroup (NYSE: MAN) today reported net earnings of 68 cents per diluted share for the three months ended December 31, 2012 compared to 78 cents per share in the prior period. The net earnings in the quarter were $53.3 million compared to $63.6 million a year earlier. Revenues for the fourth quarter totaled $5.2 billion, a decrease of 5 percent from the year earlier period, or a decrease of 4 percent in constant currency.
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Included in the current year fourth quarter results is a reorganization charge, primarily related to office consolidations and severance costs of $26.6 million ($18.3 million after tax or 23 cents per diluted share). Included in the prior year fourth quarter is a reorganization charge of $20.5 million ($16.3 million after tax or 20 cents per diluted share). Excluding these charges, net earnings per diluted share for the three months ended December 31, 2012 declined 7 percent to 91 cents per share compared to 98 cents per share in the year earlier period. Fourth quarter results were unfavorably impacted by 1 cent per diluted share as foreign currencies were relatively weaker compared to the prior year.
"We finished 2012 with a solid fourth quarter performance. Our team was able to achieve a modest revenue increase compared to the third quarter while pursuing strong price discipline and intense expense management. Our free cash flow was strong, aided by good collection activity. All offerings performed well, with ManpowerGroup Solutions and Right Management leading the way with revenue growing 7 percent in constant currency.
"We remain appropriately optimistic as we look into 2013. We are on guard for potential disruption in all markets, particularly Europe, but at this time we do not anticipate any dramatic negatives. Our first quarter is traditionally a seasonally challenging period and given the tepid demand environment, we are anticipating the first quarter of 2013 diluted earnings per share to be in the range of 40 cents to 48 cents before reorganization charges."
Net earnings per diluted share for the year ended December 31, 2012 was $2.47 compared to $3.04 per diluted share in 2011. Net earnings were $197.6 million compared to $251.6 million in the prior year. Revenues for the year were $20.7 billion, a decrease of 6 percent from the prior year, or 1 percent in constant currency.
Earnings for the full year 2012 include reorganization costs and legal settlement costs of 48 cents per diluted share. Earnings in the prior year include reorganization costs of 20 cents per diluted share. Excluding these charges, net earnings per diluted share for 2012 declined 9 percent to $2.95 per share compared to $3.24 the prior year. Additionally, 2012 results were unfavorably impacted by 15 cents per diluted share due to changes in foreign currencies compared to the prior year.
In conjunction with its fourth quarter and full year earnings release, ManpowerGroup will broadcast its conference call live over the Internet on January 30, 2013 at 7:30 a.m. CT (8:30 a.m. ET). Interested parties are invited to listen to the webcast and view the presentation by logging on to http://www.manpowergroup.com/investors.
Supplemental financial information referenced in the conference call can be found at http://www.manpowergroup.com/investors.
About ManpowerGroup(TM)
ManpowerGroup(TM) (NYSE: MAN), the world leader in innovative workforce solutions, creates and delivers high-impact solutions that enable our clients to achieve their business goals and enhance their competitiveness. With over 60 years of experience, our $21 billion company creates unique time to value through a comprehensive suite of innovative solutions that help clients win in the Human Age. These solutions cover an entire range of talent-driven needs from recruitment and assessment, training and development, and career management, to outsourcing and workforce consulting. ManpowerGroup maintains the world's largest and industry-leading network of 3,500 offices in 80 countries and territories, generating a dynamic mix of an unmatched global footprint with valuable insight and local expertise to meet the needs of its 400,000 clients per year, across all industry sectors, small and medium-sized enterprises, local, multinational and global companies. By connecting our deep understanding of human potential to the ambitions of clients, ManpowerGroup helps the organizations and individuals we serve achieve more than they imagined -- because their success leads to our success. And by creating these powerful connections, we create power that drives organizations forward, accelerates personal success and builds more sustainable communities. We help power the world of work. The ManpowerGroup suite of solutions is offered through ManpowerGroup(TM) Solutions, Manpower®, Experis(TM) and Right Management®. Learn more about how ManpowerGroup can help you win in the Human Age at www.manpowergroup.com.
ManpowerGroup is the most trusted brand in the industry, and was once again the only company in our industry to be named to the Ethisphere Institute's 2012 World's Most Ethical Companies list for our proven commitment to ethical business practices, including an outstanding commitment to ethical leadership, compliance practices and corporate social responsibility.
In January 2011, at the World Economic Forum Annual Meeting in Davos, Switzerland, ManpowerGroup announced the world has entered the Human Age, where talent has replaced capital as the key competitive differentiator. This concept of talentism as the new capitalism continues to resonate and was echoed as a core theme of the 2012 Annual Meeting of the World Economic Forum in Davos. Learn more about this new age at www.manpowergroup.com/humanage
Gain access to ManpowerGroup's extensive thought leadership papers, annual Talent Shortage surveys and the Manpower Employment Outlook Survey, one of the most trusted indices of employment activity in the world, via the ManpowerGroup World of Work Insight iPad application. This thought leadership app explores the challenges faced by employers navigating the changing world of work and provides in-depth commentary, analysis, insight and advice on strategies for success.
Follow ManpowerGroup Chairman and CEO Jeff Joerres on Twitter: twitter.com/manpowergroupjj. Joerres is one of only 20 Fortune 500 CEOs who leverages a Twitter account to get his message out.
Forward-Looking Statements
This news release contains statements, including earnings projections, that are forward-looking in nature and, accordingly, are subject to risks and uncertainties regarding the Company's expected future results. The Company's actual results may differ materially from those described or contemplated in the forward-looking statements. Factors that may cause the Company's actual results to differ materially from those contained in the forward-looking statements can be found in the Company's reports filed with the SEC, including the information under the heading 'Risk Factors' in its Annual Report on Form 10-K for the year ended December 31, 2011, which information is incorporated herein by reference.
ManpowerGroup
Results of Operations
(In millions, except per share data)
Three Months Ended December 31
------------------------------
% Variance
----------
Amount Constant
2012 2011 Reported Currency
---- ---- -------- --------
(Unaudited)
Revenues from
services (a) $5,202.6 $5,484.0 -5.1% -3.5%
Cost of services 4,325.9 4,548.8 -4.9% -3.2%
------- -------
Gross profit 876.7 935.2 -6.3% -4.9%
Selling and
administrative
expenses 771.8 805.4 -4.2% -2.8%
----- -----
Operating profit 104.9 129.8 -19.1% -17.5%
Interest and other
expenses 10.1 10.4 -2.6%
---- ----
Earnings before
income taxes 94.8 119.4 -20.6% -19.0%
Provision for
income taxes 41.5 55.8 -25.6%
Net earnings $53.3 $63.6 -16.2% -14.5%
===== =====
Net earnings per
share -basic $0.68 $0.79 -13.9%
===== =====
Net earnings per
share -diluted $0.68 $0.78 -12.8% -11.5%
===== =====
Weighted average
shares -basic 78.1 80.8 -3.4%
==== ====
Weighted average
shares -diluted 78.6 81.4 -3.4%
==== ====
(a) Revenues from services include fees received from our franchise offices of $6.0 million and $6.4 million for the
three months ended December 31, 2012 and 2011, respectively. These fees are primarily based on revenues
generated by the franchise offices, which were $257.4 million and $257.2 million for the three months ended
December 31, 2012 and 2011, respectively.
ManpowerGroup
Operating Unit Results
(In millions)
Three Months Ended December 31
------------------------------
% Variance
----------
Amount Constant
2012 2011 Reported Currency
---- ---- -------- --------
(Unaudited)
Revenues from Services:
Americas:
United States (a) $750.7 $765.9 -2.0% -2.0%
Other Americas 405.4 389.8 4.0% 4.1%
1,156.1 1,155.7 0.0% 0.1%
------- -------
Southern Europe:
France 1,314.2 1,511.0 -13.0% -9.5%
Italy 268.5 305.3 -12.0% -8.5%
Other Southern Europe 194.0 196.3 -1.2% 2.2%
1,776.7 2,012.6 -11.7% -8.2%
------- -------
Northern Europe 1,487.2 1,540.9 -3.5% -2.8%
APME 697.7 695.0 0.4% 1.4%
Right Management 84.9 79.8 6.3% 6.5%
$5,202.6 $5,484.0 -5.1% -3.5%
======== ========
Operating Unit Profit (Loss):
Americas:
United States $21.7 $26.1 -16.9% -16.9%
Other Americas 13.9 12.1 13.9% 11.1%
35.6 38.2 -7.1% -7.9%
---- ----
Southern Europe:
France 18.0 20.5 -12.0% -7.7%
Italy 8.9 19.7 -54.9% -52.0%
Other Southern Europe 1.4 2.9 -50.1% -49.1%
28.3 43.1 -34.2% -30.7%
---- ----
Northern Europe 34.2 51.8 -33.9% -33.6%
APME 28.5 21.7 31.2% 33.0%
Right Management 8.2 (5.6) N/A N/A
134.8 149.2
Corporate expenses (38.3) (30.7)
Intangible asset
amortization expense (9.3) (10.0)
Reclassification of
French business tax 17.7 21.3
Operating profit 104.9 129.8 -19.1% -17.5%
Interest and other
expenses (b) (10.1) (10.4)
Earnings before income
taxes $94.8 $119.4
===== ======
(a) In the United States, revenues from services include fees received from our franchise offices of $3.7 million and $3.8 million
for the three months ended December 31, 2012 and 2011, respectively. These fees are primarily based on revenues generated by the
franchise offices, which were $170.9 million and $167.5 million for the three months ended December 31, 2012 and 2011, respectively.
(b) The components of interest and other expenses were:
2012 2011
---- ----
Interest expense $10.7 $10.3
Interest income (1.9) (2.3)
Foreign exchange losses 0.3 0.8
Miscellaneous expense,
net 1.0 1.6
$10.1 $10.4
===== =====
ManpowerGroup
Results of Operations
(In millions, except per share data)
Year Ended December 31
----------------------
% Variance
----------
Amount Constant
2012 2011 Reported Currency
---- ---- -------- --------
(Unaudited)
Revenues from
services (a) $20,678.0 $22,006.0 -6.0% -1.4%
Cost of services 17,236.0 18,299.7 -5.8% -1.1%
-------- --------
Gross profit 3,442.0 3,706.3 -7.1% -3.0%
Selling and
administrative
expenses 3,030.3 3,182.1 -4.8% -0.8%
------- -------
Operating profit 411.7 524.2 -21.5% -16.5%
Interest and other
expenses 43.3 44.3 -2.3%
---- ----
Earnings before
income taxes 368.4 479.9 -23.2% -18.2%
Provision for
income taxes 170.8 228.3 -25.2%
Net earnings $197.6 $251.6 -21.5% -16.3%
====== ======
Net earnings per
share -basic $2.49 $3.08 -19.2%
===== =====
Net earnings per
share -diluted $2.47 $3.04 -18.8% -14.1%
===== =====
Weighted average
shares -basic 79.5 81.6 -2.7%
==== ====
Weighted average
shares -diluted 80.1 82.8 -3.3%
==== ====
(a) Revenues from services include fees received from our franchise offices of $23.9 million and $25.2 million for
the years ended December 31, 2012 and 2011, respectively. These fees are primarily based on
revenues generated by the franchise offices, which were $1,051.8 million and $1,075.2 million for the years
ended December 31, 2012 and 2011, respectively.
ManpowerGroup
Operating Unit Results
(In millions)
Year Ended December 31
----------------------
% Variance
----------
Amount Constant
2012 2011 Reported Currency
---- ---- -------- --------
(Unaudited)
Revenues from Services:
Americas:
United States (a) $3,010.5 $3,137.3 -4.0% -4.0%
Other Americas 1,585.4 1,512.1 4.8% 9.9%
4,595.9 4,649.4 -1.2% 0.5%
------- -------
Southern Europe:
France 5,425.6 6,179.1 -12.2% -4.6%
Italy 1,056.8 1,255.8 -15.8% -8.9%
Other Southern Europe 768.5 776.9 -1.1% 6.9%
7,250.9 8,211.8 -11.7% -4.2%
------- -------
Northern Europe 5,773.9 6,159.4 -6.3% -1.3%
APME 2,728.8 2,661.7 2.5% 3.1%
Right Management 328.5 323.7 1.5% 3.4%
$20,678.0 $22,006.0 -6.0% -1.4%
========= =========
Operating Unit Profit (Loss):
Americas:
United States $60.8 $94.1 -35.4% -35.4%
Other Americas 50.6 47.8 5.7% 9.1%
111.4 141.9 -21.6% -20.4%
----- -----
Southern Europe:
France 56.7 85.2 -33.4% -26.6%
Italy 45.4 74.1 -38.7% -33.4%
Other Southern Europe 10.1 10.8 -6.8% 1.0%
112.2 170.1 -34.0% -27.8%
----- -----
Northern Europe 159.8 212.6 -24.8% -21.0%
APME 90.7 78.8 15.2% 16.2%
Right Management 13.4 (1.4) N/A N/A
487.5 602.0
Corporate expenses (112.0) (123.1)
Intangible asset
amortization expense (36.7) (38.9)
Reclassification of
French business tax 72.9 84.2
Operating profit 411.7 524.2 -21.5% -16.5%
Interest and other
expenses (b) (43.3) (44.3)
Earnings before income
taxes $368.4 $479.9
====== ======
(a) In the United States, revenues from services include fees received from our franchise offices of $14.6 million and $13.6 million for
the years ended December 31, 2012 and 2011. These fees are primarily based on revenues generated by the franchise offices, which were
$691.7 million and $646.1 million for the years ended December 31, 2012 and 2011, respectively.
(b) The components of interest and other expenses were:
2012 2011
---- ----
Interest expense $41.8 $42.8
Interest income (6.6) (7.3)
Foreign exchange losses 0.9 2.8
Miscellaneous expenses,
net 7.2 6.0
$43.3 $44.3
===== =====
ManpowerGroup
Consolidated Balance Sheets
(In millions)
Dec. 31 Dec. 31
2012 2011
---- ----
(Unaudited)
ASSETS
Current assets:
Cash and cash
equivalents $648.1 $580.5
Accounts
receivable,
net 4,179.0 4,181.3
Prepaid
expenses and
other assets 172.9 176.3
Future income
tax benefits 60.6 52.4
Total current
assets 5,060.6 4,990.5
Other assets:
Goodwill and
other
intangible
assets, net 1,371.9 1,339.6
Other assets 395.3 395.1
Total other
assets 1,767.2 1,734.7
Property and
equipment:
Land,
buildings,
leasehold
improvements
and equipment 704.1 685.6
Less:
accumulated
depreciation
and
amortization 519.3 511.1
Net property
and equipment 184.8 174.5
Total assets $7,012.6 $6,899.7
======== ========
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Current
liabilities:
Accounts
payable $1,466.5 $1,370.6
Employee
compensation
payable 210.7 221.9
Accrued
liabilities 533.8 520.8
Accrued payroll
taxes and
insurance 685.7 712.4
Value added
taxes payable 472.5 502.3
Short-term
borrowings and
current
maturities of
long-term
debt 308.0 434.2
Total current
liabilities 3,677.2 3,762.2
Other
liabilities:
Long-term debt 462.1 266.0
Other long-
term
liabilities 372.5 388.1
Total other
liabilities 834.6 654.1
Shareholders'
equity:
Common stock 1.1 1.1
Capital in
excess of par
value 2,873.2 2,839.9
Retained
earnings 1,101.5 971.7
Accumulated
other
comprehensive
income 34.4 35.3
Treasury stock,
at cost (1,509.4) (1,364.6)
Total
shareholders'
equity 2,500.8 2,483.4
Total
liabilities
and
shareholders'
equity $7,012.6 $6,899.7
======== ========
ManpowerGroup
Consolidated Statements of Cash Flows
(In millions)
Year Ended
December 31
-----------
2012 2011
---- ----
(Unaudited)
Cash Flows from Operating
Activities:
Net earnings $197.6 $251.6
Adjustments to reconcile
net earnings to net
cash provided by operating
activities:
Depreciation and
amortization 100.5 104.4
Deferred income taxes (11.6) 24.8
Provision for doubtful
accounts 29.2 25.9
Share-based compensation 30.0 31.4
Excess tax benefit on
exercise of share-based
awards (0.3) (1.3)
Changes in operating
assets and liabilities,
excluding
the impact of
acquisitions:
Accounts receivable 48.3 (417.1)
Other assets (9.2) (48.2)
Other liabilities (52.9) 97.7
Cash provided by operating
activities 331.6 69.2
----- ----
Cash Flows from Investing
Activities:
Capital expenditures (72.0) (64.9)
Acquisitions of
businesses, net of cash
acquired (49.0) (49.0)
Proceeds from sales of
property and equipment 3.7 4.4
Cash used in investing
activities (117.3) (109.5)
------ ------
Cash Flows from Financing
Activities:
Net change in short-term
borrowings (6.7) 15.6
Proceeds from long-term
debt 751.6 0.8
Repayments of long-term
debt (703.2) (1.1)
Proceeds from share-based
awards 6.0 29.5
Other share-based award
transactions, net (6.3) 1.3
Repurchases of common
stock (138.2) (104.5)
Dividends paid (67.8) (65.1)
Cash used in financing
activities (164.6) (123.5)
------ ------
Effect of exchange rate
changes on cash 17.9 (28.3)
Change in cash and cash
equivalents 67.6 (192.1)
Cash and cash equivalents,
beginning of period 580.5 772.6
Cash and cash equivalents,
end of period $648.1 $580.5
====== ======
SOURCE ManpowerGroup
