ManpowerGroup Q1 revenue falls, outplacement activity increases
ManpowerGroup Inc. (NYSE: MAN) has released their Q1 earnings report, revealing a 2.2% decline in revenue in constant currency or 7.6% on a reported basis, totaling $4.75 billion. The decline in revenue was attributed to a challenging operating environment in the US and Europe, despite labor markets remaining strong. Chairman and CEO Jonas Prising noted that employers are being more selective with new hires and focused on retaining their existing staff. ManpowerGroup will continue to adjust their cost base in areas where demand has decreased.
The company’s gross margin improved due to strong pricing discipline and increased outplacement activity in their Right Management business line. In terms of revenue by region, US revenue fell 13.4%, while revenue across Europe fell on a constant currency basis with the exception of France where it rose 2.5%. Revenue in the Asia Pacific Middle East operations increased by 7.3% in constant currency.
Looking at earnings by business line, the Talent Solutions segment, which includes ManpowerGroup’s Right Management and outplacement operations, fell 1% year over year on an organic, constant currency basis but was up 1% on a reported basis. The Manpower and Experis operations saw declines in revenue of 1% and 5%, respectively.
For Q2, ManpowerGroup forecasts a total revenue decline between 2% and 6%, with a decline of 8% to 12% in Americas revenue and declines ranging from 3% to 8% in Europe. Asia Pacific Middle East revenue is expected to be flat to up 4%. The company expects a gross profit margin between 17.9% and 18.1%.
ManpowerGroup’s shares were down 5.92% to $74.80 and the company’s market cap was $4.04 billion, according to FT.com.