ManpowerGroup Reports 2nd Quarter 2022 Results
ManpowerGroup reported Q2 2022 revenues of $5.1 billion, a 4% decline year-over-year, though up 6% in constant currency. Net earnings rose to $122.2 million, or $2.29 per diluted share. Integration costs from the U.S. Experis acquisition impacted earnings by $0.04. Despite challenges in European markets due to supply chain disruptions, higher-margin brands like Experis and Talent Solutions showed strong growth. The company repurchased $100 million in common stock and refinanced a €400 million Euro Note, extending its maturity to June 2027.
- Net earnings increased to $122.2 million, or $2.29 per diluted share, up from $111.6 million or $2.02 per diluted share year-over-year.
- Higher-margin brands, particularly Experis and Talent Solutions, exhibited significant revenue growth.
- On a constant currency basis, revenues increased 6%, indicating strong demand.
- The company repurchased $100 million in common stock during the quarter.
- Improved EBITA and operating profit margins reflect enhanced profitability.
- Revenues decreased by 4% year-over-year, raising concerns about overall growth.
- Integration costs from the Experis acquisition negatively impacted earnings per share by $0.04.
- A stronger U.S. dollar led to a negative impact of 25 cents on earnings per share compared to the prior year.
- Ongoing supply chain disruptions in Europe, particularly in the automotive sector, could hinder performance.
- Revenues of
$5.1 billion (-4% as reported, +6% constant currency (CC)) - Gross profit margin of
18.2% , aided by high levels of permanent recruitment activity - Continued strong performance of higher margin brands with significant revenue growth in Experis and Talent Solutions. Manpower performance was more modest due to supply chain disruptions in certain European markets
- Improved profitability with expanded EBITA and operating profit margins
$100 million of common stock repurchased during the quarter- Refinanced existing
€400 million Euro Note, extending maturity from September 2022 to June 2027
MILWAUKEE, July 19, 2022 /PRNewswire/ -- ManpowerGroup (NYSE: MAN) today reported net earnings of
The current year quarter included integration costs from the U.S. Experis acquisition. These costs reduced earnings per share by
Financial results in the quarter were also impacted by the stronger U.S. dollar relative to foreign currencies compared to the prior year period, resulting in a 25 cent negative impact to earnings per share in the quarter compared to the prior year. This represented an additional 6 cent negative impact to earnings per share from foreign currency than anticipated in our second quarter guidance. On a constant currency basis, revenues increased
Jonas Prising, ManpowerGroup Chairman & CEO, said, "Our second quarter results demonstrate the disciplined execution of our strategic initiatives and the continued strength of demand for our higher margin businesses. Overall, we made solid progress during the second quarter and believe that the continued execution of our Diversification, Digitization and Innovation strategy positions us well for ongoing success. Notably, our ability to create talent at scale through our innovative MyPath and Experis Academy programs are clear differentiators in the market.
As we start the third quarter, labor markets remain very solid and demand for talent is strong. We continue to monitor those sectors in Europe where present-day supply-chain disruptions are impacting our business, particularly in the automotive industry. At the same time, we also believe the persistent level of talent shortage represents a significant opportunity for our business. We see this evidenced by the strong ongoing demand in our permanent recruitment services, in our RPO and MSP Talent Solution offerings, in our Experis IT resourcing and solutions, and across our Manpower Specializations.
We anticipate diluted earnings per share in the third quarter will be between
Net earnings for the six months ended June 30, 2022 were
In conjunction with its second quarter earnings release, ManpowerGroup will broadcast its conference call live over the Internet on July 19, 2022 at 7:30 a.m. central time (8:30 a.m. eastern time). Prepared remarks for the conference call are included within the Investor Relations section of our website at manpowergroup.com. Interested parties are invited to listen to the webcast and view the presentation by logging on to http://investor.manpowergroup.com/ in the section titled "Investor Relations."
Supplemental financial information referenced in the conference call can be found at http://investor.manpowergroup.com/.
ManpowerGroup® (NYSE: MAN), the leading global workforce solutions company, helps organizations transform in a fast-changing world of work by sourcing, assessing, developing and managing the talent that enables them to win. We develop innovative solutions for hundreds of thousands of organizations every year, providing them with skilled talent while finding meaningful, sustainable employment for millions of people across a wide range of industries and skills. Our expert family of brands – Manpower, Experis and Talent Solutions – creates substantially more value for candidates and clients across more than 75 countries and territories and has done so for over 70 years. We are recognized consistently for our diversity - as a best place to work for Women, Inclusion, Equality and Disability and in 2022 ManpowerGroup was named one of the World's Most Ethical Companies for the 13th year - all confirming our position as the brand of choice for in-demand talent.
This news release contains statements, including statements regarding economic and geopolitical uncertainty, labor and financial outlook, and the Company's strategic initiatives and brands 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 due to numerous factors. These factors include those 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, 2021, as well as the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2022, which information is incorporated herein by reference.
ManpowerGroup | ||||
Results of Operations | ||||
(In millions, except per share data) | ||||
Three Months Ended June 30 | ||||
% Variance | ||||
Amount | Constant | |||
2022 | 2021 | Reported | Currency | |
(Unaudited) | ||||
Revenues from services (a) | $ 5,074.1 | $ 5,277.1 | -3.8 % | 5.7 % |
Cost of services | 4,152.9 | 4,417.0 | -6.0 % | 3.6 % |
Gross profit | 921.2 | 860.1 | 7.1 % | 16.4 % |
Selling and administrative expenses | 740.5 | 690.2 | 7.3 % | 16.0 % |
Operating profit | 180.7 | 169.9 | 6.3 % | 18.1 % |
Interest and other expenses, net | 6.7 | 2.8 | 135.3 % | |
Earnings before income taxes | 174.0 | 167.1 | 4.1 % | 15.5 % |
Provision for income taxes | 51.8 | 55.5 | -6.7 % | |
Net earnings | $ 122.2 | $ 111.6 | 9.5 % | 21.5 % |
Net earnings per share - basic | $ 2.32 | $ 2.05 | 13.2 % | |
Net earnings per share - diluted | $ 2.29 | $ 2.02 | 13.4 % | 25.7 % |
Weighted average shares - basic | 52.7 | 54.5 | -3.3 % | |
Weighted average shares - diluted | 53.4 | 55.4 | -3.6 % | |
(a) Revenues from services include fees received from our franchise offices of | ||||
ManpowerGroup | ||||
Operating Unit Results | ||||
(In millions) | ||||
Three Months Ended June 30 | ||||
% Variance | ||||
Amount | Constant | |||
2022 | 2021 | Reported | Currency | |
(Unaudited) | ||||
Revenues from Services: | ||||
Americas: | ||||
United States (a) | $ 903.9 | $ 628.8 | 43.7 % | 43.7 % |
Other Americas | 358.8 | 415.5 | -13.6 % | -9.0 % |
1,262.7 | 1,044.3 | 20.9 % | 22.7 % | |
Southern Europe: | ||||
France | 1,238.2 | 1,346.8 | -8.1 % | 4.1 % |
Italy | 454.3 | 469.1 | -3.2 % | 9.7 % |
Other Southern Europe | 508.9 | 606.5 | -16.1 % | -7.8 % |
2,201.4 | 2,422.4 | -9.1 % | 2.2 % | |
Northern Europe | 1,027.1 | 1,190.5 | -13.7 % | -2.4 % |
APME | 603.7 | 619.9 | -2.6 % | 9.7 % |
5,094.9 | 5,277.1 | |||
Intercompany Eliminations | (20.8) | - | ||
$ 5,074.1 | $ 5,277.1 | -3.8 % | 5.7 % | |
Operating Unit Profit: | ||||
Americas: | ||||
United States | $ 64.7 | $ 38.0 | 70.3 % | 70.3 % |
Other Americas | 16.2 | 18.0 | -10.4 % | -4.1 % |
80.9 | 56.0 | 44.4 % | 46.4 % | |
Southern Europe: | ||||
France | 62.3 | 65.7 | -5.2 % | 7.5 % |
Italy | 35.5 | 31.7 | 12.0 % | 27.1 % |
Other Southern Europe | 13.9 | 17.9 | -22.6 % | -16.6 % |
111.7 | 115.3 | -3.2 % | 9.1 % | |
Northern Europe | 10.8 | 17.9 | -39.1 % | -29.9 % |
APME | 22.5 | 22.3 | 0.8 % | 15.8 % |
225.9 | 211.5 | |||
Corporate expenses | (35.8) | (37.3) | ||
Intangible asset amortization expense | (9.4) | (4.3) | ||
Operating profit | 180.7 | 169.9 | 6.3 % | 18.1 % |
Interest and other expenses, net (b) | (6.7) | (2.8) | ||
Earnings before income taxes | $ 174.0 | $ 167.1 | ||
(a) In the United States, revenues from services include fees received from our franchise offices of | ||||
(b) The components of interest and other expenses, net were: | ||||
2022 | 2021 | |||
Interest expense | $ 10.6 | $ 9.7 | ||
Interest income | (2.8) | (3.1) | ||
Foreign exchange loss | 3.3 | 0.6 | ||
Miscellaneous income | (4.4) | (4.4) | ||
$ 6.7 | $ 2.8 | |||
ManpowerGroup | ||||
Results of Operations | ||||
(In millions, except per share data) | ||||
Six Months Ended June 30 | ||||
% Variance | ||||
Amount | Constant | |||
2022 | 2021 | Reported | Currency | |
(Unaudited) | ||||
Revenues from services (a) | $ 10,217.4 | $ 10,201.5 | 0.2 % | 7.7 % |
Cost of services | 8,399.1 | 8,573.3 | -2.0 % | 5.5 % |
Gross profit | 1,818.3 | 1,628.2 | 11.7 % | 19.2 % |
Selling and administrative expenses | 1,498.9 | 1,359.9 | 10.2 % | 17.1 % |
Operating profit | 319.4 | 268.3 | 19.0 % | 29.6 % |
Interest and other expenses, net | 9.4 | 8.2 | 13.6 % | |
Earnings before income taxes | 310.0 | 260.1 | 19.2 % | 29.5 % |
Provision for income taxes | 96.2 | 86.5 | 11.2 % | |
Net earnings | $ 213.8 | $ 173.6 | 23.2 % | 33.9 % |
Net earnings per share - basic | $ 4.02 | $ 3.17 | 26.8 % | |
Net earnings per share - diluted | $ 3.97 | $ 3.13 | 26.8 % | 38.0 % |
Weighted average shares - basic | 53.2 | 54.8 | -3.1 % | |
Weighted average shares - diluted | 53.8 | 55.5 | -3.0 % | |
(a) Revenues from services include fees received from our franchise offices of | ||||
ManpowerGroup | ||||
Operating Unit Results | ||||
(In millions) | ||||
Six Months Ended June 30 | ||||
% Variance | ||||
Amount | Constant | |||
2022 | 2021 | Reported | Currency | |
(Unaudited) | ||||
Revenues from Services: | ||||
Americas: | ||||
United States (a) | $ 1,793.3 | $ 1,237.6 | 44.9 % | 44.9 % |
Other Americas | 720.6 | 809.6 | -11.0 % | -7.5 % |
2,513.9 | 2,047.2 | 22.8 % | 24.2 % | |
Southern Europe: | ||||
France | 2,430.6 | 2,535.7 | -4.1 % | 5.8 % |
Italy | 899.3 | 871.9 | 3.1 % | 13.8 % |
Other Southern Europe | 1,065.4 | 1,175.1 | -9.3 % | -2.7 % |
4,395.3 | 4,582.7 | -4.1 % | 5.1 % | |
Northern Europe | 2,121.6 | 2,324.3 | -8.7 % | -0.3 % |
APME | 1,221.9 | 1,247.3 | -2.0 % | 7.8 % |
10,252.7 | 10,201.5 | |||
Intercompany Eliminations | (35.3) | - | ||
$ 10,217.4 | $ 10,201.5 | 0.2 % | 7.7 % | |
Operating Unit Profit: | ||||
Americas: | ||||
United States | $ 123.0 | $ 67.2 | 83.0 % | 83.0 % |
Other Americas | 30.7 | 32.9 | -6.7 % | -2.0 % |
153.7 | 100.1 | 53.5 % | 55.1 % | |
Southern Europe: | ||||
France | 111.9 | 108.3 | 3.3 % | 14.4 % |
Italy | 64.5 | 51.1 | 26.3 % | 39.9 % |
Other Southern Europe | 30.5 | 29.3 | 4.0 % | 9.3 % |
206.9 | 188.7 | 9.6 % | 20.5 % | |
Northern Europe | 14.1 | 22.7 | -37.7 % | -31.0 % |
APME | 41.5 | 41.1 | 0.8 % | 13.2 % |
416.2 | 352.6 | |||
Corporate expenses | (77.8) | (74.5) | ||
Intangible asset amortization expense | (19.0) | (9.8) | ||
Operating profit | 319.4 | 268.3 | 19.0 % | 29.6 % |
Interest and other expenses, net (b) | (9.4) | (8.2) | ||
Earnings before income taxes | $ 310.0 | $ 260.1 | ||
(a) In the United States, revenues from services include fees received from our franchise offices of | ||||
(b) The components of interest and other expenses, net were: | ||||
2022 | 2021 | |||
Interest expense | $ 21.0 | $ 19.9 | ||
Interest income | (5.6) | (6.2) | ||
Foreign exchange loss | 5.1 | 3.1 | ||
Miscellaneous income | (11.1) | (8.6) | ||
$ 9.4 | $ 8.2 | |||
ManpowerGroup | |||
Consolidated Balance Sheets | |||
(In millions) | |||
Jun. 30, | Dec. 31, | ||
2022 | 2021 | ||
(Unaudited) | |||
ASSETS | |||
Current assets: | |||
Cash and cash equivalents | $ 886.2 | $ 847.8 | |
Accounts receivable, net | 5,343.9 | 5,448.2 | |
Prepaid expenses and other assets | 171.8 | 126.7 | |
Total current assets | 6,401.9 | 6,422.7 | |
Other assets: | |||
Goodwill | 1,669.9 | 1,722.2 | |
Intangible assets, net | 560.9 | 583.6 | |
Operating lease right-of-use asset | 314.0 | 373.4 | |
Other assets | 561.8 | 610.2 | |
Total other assets | 3,106.6 | 3,289.4 | |
Property and equipment: | |||
Land, buildings, leasehold improvements and equipment | 568.0 | 594.9 | |
Less: accumulated depreciation and amortization | 458.0 | 478.1 | |
Net property and equipment | 110.0 | 116.8 | |
Total assets | $ 9,618.5 | $ 9,828.9 | |
LIABILITIES AND SHAREHOLDERS' EQUITY | |||
Current liabilities: | |||
Accounts payable | $ 3,023.2 | $ 3,039.2 | |
Employee compensation payable | 229.9 | 299.4 | |
Accrued liabilities | 540.8 | 584.7 | |
Accrued payroll taxes and insurance | 704.8 | 789.1 | |
Value added taxes payable | 421.4 | 515.5 | |
Short-term borrowings and current maturities of long-term debt | 481.0 | 552.6 | |
Total current liabilities | 5,401.1 | 5,780.5 | |
Other liabilities: | |||
Long-term debt | 942.2 | 565.7 | |
Long-term operating lease liability | 222.2 | 275.8 | |
Other long-term liabilities | 608.2 | 675.2 | |
Total other liabilities | 1,772.6 | 1,516.7 | |
Shareholders' equity: | |||
ManpowerGroup shareholders' equity | |||
Common stock | 1.2 | 1.2 | |
Capital in excess of par value | 3,465.8 | 3,444.7 | |
Retained earnings | 3,777.2 | 3,634.6 | |
Accumulated other comprehensive loss | (471.5) | (389.4) | |
Treasury stock, at cost | (4,337.5) | (4,169.4) | |
Total ManpowerGroup shareholders' equity | 2,435.2 | 2,521.7 | |
Noncontrolling interests | 9.6 | 10.0 | |
Total shareholders' equity | 2,444.8 | 2,531.7 | |
Total liabilities and shareholders' equity | $ 9,618.5 | $ 9,828.9 | |
ManpowerGroup | |||
Consolidated Statements of Cash Flows | |||
(In millions) | |||
Six Months Ended | |||
June 30, | |||
2022 | 2021 | ||
(Unaudited) | |||
Cash Flows from Operating Activities: | |||
Net earnings | $ 213.8 | $ 173.6 | |
Adjustments to reconcile net earnings to net cash provided by operating activities: | |||
Depreciation and amortization | 42.5 | 34.4 | |
Loss on sale of a subsidiary | 8.0 | - | |
Deferred income taxes | 2.8 | (13.3) | |
Provision for doubtful accounts | 6.1 | 9.2 | |
Share-based compensation | 21.6 | 16.9 | |
Changes in operating assets and liabilities, excluding the impact of dispositions: | |||
Accounts receivable | (218.3) | (381.7) | |
Other assets | (18.0) | (6.3) | |
Other liabilities | (37.2) | 362.6 | |
Cash provided by operating activities | 21.3 | 195.4 | |
Cash Flows from Investing Activities: | |||
Capital expenditures | (41.7) | (24.6) | |
Acquisitions of businesses, net of cash acquired | - | (7.1) | |
Proceeds from the sale of subsidiaries and property and equipment | 1.0 | 0.9 | |
Cash used in investing activities | (40.7) | (30.8) | |
Cash Flows from Financing Activities: | |||
Net change in short-term borrowings | (3.9) | 3.1 | |
Repayments of revolving debt facility | (25.0) | - | |
Proceeds from long-term debt | 416.1 | 0.3 | |
Repayments of long-term debt | (2.5) | (2.2) | |
Payments for debt issuance costs | (1.5) | - | |
Proceeds from derivative settlement | 2.0 | - | |
Payments of contingent consideration for acquisitions | (1.4) | (6.2) | |
Proceeds from share-based awards | 0.3 | 4.2 | |
Payments to noncontrolling interests | (1.0) | - | |
Other share-based award transactions | (8.1) | (4.6) | |
Repurchases of common stock | (160.0) | (150.1) | |
Dividends paid | (71.2) | (68.3) | |
Cash provided by (used in) | 143.8 | (223.8) | |
Effect of exchange rate changes on cash | (86.0) | (46.5) | |
Change in cash and cash equivalents | 38.4 | (105.7) | |
Cash and cash equivalents, beginning of period | 847.8 | 1,567.1 | |
Cash and cash equivalents, end of period | $ 886.2 | $ 1,461.4 | |
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SOURCE ManpowerGroup
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