Second-quarter revenue at ManpowerGroup Inc. (NYSE: MAN) fell 3.5% year over year in constant currency to $4.86 billion. US revenue was down 18.5%. A challenging operating environment in the US and Europe helped lead to revenue declines in the company’s Manpower, Experis and Talent Solutions segments.
The Milwaukee-based staffing giant noted a weakening in permanent recruitment and narrowed gross margin. ManpowerGroup also announced it is winding down its Proservia managed services in Germany.
“Our second-quarter results reflect a challenging operating environment for recruitment and resourcing in the US and Europe,” ManpowerGroup Chairman and CEO Jonas Prising said in a press release. “However, we continued to see demand in certain segments within these markets and ongoing strength in Latin America and Asia Pacific Middle East.”
Second-quarter revenue in ManpowerGroup’s Talent Solutions segment fell 9% in constant currency, or 4% on a reported basis. Talent Solutions includes the company’s Right Management and outplacement operations as well as RPO and MSP businesses. The constant currency revenue was driven by RPO, which was partially offset by strong growth in Right Management.
Experis, which provides IT staffing and services, saw revenue fall 11% in constant currency and 12% on a reported basis.
Second-quarter revenue in the Manpower staffing segment fell 1% in constant currency and 2% on a reported basis.
The second quarter also included $14.5 million in restructuring costs, the majority of which, $7.7 million, was in Northern Europe. The company also cited $6.0 million in restructuring costs in Southern Europe and $800,000 in the Americas.
ManpowerGroup also noted the quarter includes noncash currency translation losses in Argentina. The country is required to be treated as a hyperinflationary economy, and the currency translation losses reflect the devaluation of the Argentine peso during the quarter.
Guidance
For the third quarter, ManpowerGroup forecasts:
- Total revenue to range from being up 2% to down 2% (down 3% to down 7% in constant currency)
- Americas revenue, down 9% to down 13% (down 7% to down 11% in constant currency)
- Southern Europe revenue, up 5% to up 9% (flat to down 4% in constant currency)
- Northern Europe revenue, down 1% to up 3% (down 4% to down 8% in constant currency)
- Asia Pacific Middle East revenue, flat to down 4% (down 3% to up 1% in constant currency)
- Gross profit margin, between 17.3% and 17.5%
Share price market cap
Shares in ManpowerGroup were down 6.22% to $83.32 as of 11:41 a.m. Eastern time; they were 9.86% below their 52-week high, according to FT.com. The company had a market cap of $4.48 billion.