KELLY SERVICES INC
For the period ended Sep 29, 2024. Filed Nov 7, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 29, 2024 · Filed Nov 7, 2024
KELYB$25.55-4.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-08.
0000055135-24-000031
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-29; filed 2024-11-07.
0000055135-24-000036
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 109 previous paragraphs and 107 current paragraphs.
41 unchanged; 61 reworded; 5 added; 4 removed; 3 previous and 0 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (5)
Current report
Income tax benefit was $2.6 million for the third quarter of 2024 compared to $4.9 million for the third quarter of 2023. The change primarily relates to the benefit of a deferred tax valuation allowance release in 2023 partially offset by the impact of non-taxable income related to company-owned life insurance assets in 2024.
Current report
Total SG&A expenses excluding depreciation and amortization in Outsourcing & Consulting decreased 14.8% from the prior year, primarily due to lower employee-related expenses as compared to the prior year including lower employee compensation costs and cost management in response to lower revenue volume in the MSP and RPO solutions.
Current report
Education reported a loss of $3.3 million for the quarter, compared to a loss of $2.5 million a year ago. The change was primarily driven by flat gross profit despite revenue growth and an increase in SG&A expenses.
Current report
Corporate expenses remained consistent with the prior year.
Current report
Outsourcing & Consulting reported profit of $3.5 million for the first nine months of 2024, compared to $1.6 million a year ago. The change was primarily due to lower SG&A expenses and an increase in revenue, partially offset by a decline in gross profit.
Removed paragraphs (4)
Previous report
Income tax expense was $1.1 million for the second quarter of 2024 compared to a tax benefit of $1.9 million for the second quarter of 2023. The change primarily relates to non-deductible transaction costs and a valuation allowance on the tax benefit from the reduction in the EMEA staffing operations sale proceeds in 2024.
Previous report
Total SG&A expenses excluding depreciation and amortization in Outsourcing & Consulting decreased 11.7% from the prior year, primarily due to lower performance-based incentive compensation expenses.
Previous report
Corporate expenses decreased $1.8 million year-over-year primarily due to lower transformation-related costs partially offset by EMEA staffing operations transition-related costs.
Previous report
Outsourcing & Consulting reported profit of $1.2 million for the first six months of 2024, compared to $0.1 million a year ago. The change was primarily due to the impact of the asset impairment charge in the second quarter of 2023.
Reworded paragraphs (61)
Previous wording
As the year progresses, challenging staffing market dynamics continued as employers in most sectors maintained a guarded approach to hiring and focused on retaining their current workforce amid ongoing economic uncertainty. In more resilient pockets of the economy where employers are in need of talent, the supply of candidates to fill open roles remains constrained. These dynamics put pressure on our business, but we remain focused on capturing growth where it exists and positioning our resources to take advantage of even greater opportunities when conditions improve.
Current wording
As the year progresses, challenging staffing market dynamics continued as employers in most sectors maintained a cautious approach to managing their workforces, deferring hiring decisions, managing existing headcount through attrition, and in some cases choosing not to backfill open roles amid ongoing economic uncertainty. These dynamics put pressure on our business, but we remain focused on capturing growth where it exists and positioning our resources to take advantage of opportunities when conditions improve.
Previous wording
We completed the sale of our European staffing operations on January 2, 2024 and on June 12, 2024 announced the sale of the Ayers Group, a division of our OCG segment. We move forward with a streamlined operating model focused on North American staffing and global MSP and RPO solutions.
Current wording
We completed the sale of our European staffing operations on January 2, 2024 and on June 12, 2024 announced the sale of the Ayers Group, a division of our OCG segment. We move forward with a streamlined operating model focused on North American staffing and solutions and global MSP and RPO solutions.
Previous wording
To further sharpen our focus on higher-margin, higher-growth specialties, we completed the acquisition of Motion Recruitment Partners, LLC (“MRP”) on May 31, 2024. The acquisition of MRP will strengthen the scale and capabilities of Kelly’s staffing and consulting solutions across technology, telecommunications, and government specialties in North America, and RPO solutions globally.
Current wording
To further sharpen our focus on higher-margin, higher-growth specialties, we completed the acquisition of Motion Recruitment Partners, LLC (“MRP”) on May 31, 2024. The acquisition of MRP is expected to strengthen the scale and capabilities of Kelly’s staffing and consulting solutions across technology, telecommunications, and government specialties in North America, and RPO solutions globally.
Previous wording
Days sales outstanding (“DSO”) represents the number of days that sales remain unpaid for the period being reported. DSO is calculated by dividing average net sales per day (based on a rolling three-month period) into trade accounts receivable, net of allowances at the period end. Although secondary supplier revenues are recorded on a net basis (net of secondary supplier expense), secondary supplier revenue is included in the daily sales calculation in order to properly reflect the gross revenue amounts billed to the customer. The DSO calculation excludes results from the MRP acquisition as our consolidated results do not reflect a full quarter of revenue for MRP whereas our consolidated balance sheet as of the second quarter-end 2024 includes the full amount of the related accounts receivable.
Current wording
Days sales outstanding (“DSO”) represents the number of days that sales remain unpaid for the period being reported. DSO is calculated by dividing average net sales per day (based on a rolling three-month period) into trade accounts receivable, net of allowances at the period end. Although secondary supplier revenues are recorded on a net basis (net of secondary supplier expense), secondary supplier revenue is included in the daily sales calculation in order to properly reflect the gross revenue amounts billed to the customer.
Previous wording
Revenue from services in the second quarter decreased 13.1%, which primarily reflects the January 2, 2024 sale of our EMEA staffing operations, partially offset from an increase related to the acquisition of MRP in June 2024. Excluding the impact from the sale and the acquisition, revenue from services increased 0.6%. This increase reflects revenue increases in the Education and Outsourcing & Consulting segments which were mostly offset by declines in the Professional & Industrial and Science, Engineering & Technology segments. Compared to the second quarter of 2023 and excluding the impact from the sale and acquisition, revenue from staffing services increased 2.3% and revenue from outcome-based services decreased 4.8%. In addition, revenue from talent solutions increased 2.9% and permanent placement revenue decreased 19.9% from the prior year, excluding the impact from the sale and the acquisition.
Current wording
Revenue from services in the third quarter decreased 7.1%, which primarily reflects the January 2, 2024 sale of our EMEA staffing operations, partially offset by an increase related to the acquisition of MRP in May 2024. Excluding the impact from the sale and the acquisition, revenue from services was flat year-over-year with decreases in the Science, Engineering & Technology and Professional & Industrial segments offset by increases in the Education and Outsourcing & Consulting segments. Compared to the third quarter of 2023 and excluding the impact from the sale and acquisition, revenue from staffing services was flat to the prior year and revenue from outcome-based services decreased 2.2%. In addition, revenue from talent solutions increased 6.0% and permanent placement revenue decreased 30.8% from the prior year, excluding the impact from the sale and the acquisition.
Previous wording
Gross profit decreased 11.2% largely driven by the sale of our EMEA staffing operations, partially offset from an increase related to the acquisition of MRP. Excluding the impact from the sale and the acquisition, gross profit decreased 4.3%. The gross profit rate increased 40 basis points to 20.2% and was favorably impacted by the sale of our EMEA staffing operations and the acquisition of MRP. Excluding the impact from the sale and acquisition, the gross profit rate declined 100 basis points. These decreases are due primarily to unfavorable business mix and a decrease in permanent placement revenue, partially offset by a decrease in employee-related costs. Permanent placement revenue has very low direct costs of services and has a disproportionate impact on gross profit rates. The gross profit rate decreased in all segments on an organic basis, excluding the MRP acquisition.
Current wording
Gross profit decreased 3.0% largely driven by the sale of our EMEA staffing operations, partially offset by an increase related to the acquisition of MRP. Excluding the impact from the sale and the acquisition, gross profit decreased 6.4%. The gross profit rate increased 100 basis points to 21.4% and was favorably impacted by the sale of our EMEA staffing operations and the acquisition of MRP. Excluding the impact from the sale and acquisition, the gross profit rate declined 140 basis points. These decreases are due primarily to business mix and a decrease in permanent placement revenue, partially offset by a decrease in employee-related costs. Permanent placement revenue has very low direct costs of services and has a disproportionate impact on gross profit rates. The gross profit rate decreased in all segments excluding the sale and the acquisition.
Previous wording
Total SG&A expenses decreased 17.4%, primarily due to the sale of our EMEA staffing operations, partially offset by the acquisition of MRP. Excluding these impacts, SG&A expenses decreased 10.1%. Included in SG&A expenses in the second quarter of 2024 and 2023 were $4.3 million and $5.6 million of transformation and restructuring charges, respectively. Actions taken in the second quarter of 2024 and 2023 were a continuation of the actions that were announced in the second quarter of 2023 as part of the comprehensive transformation initiative. In addition, SG&A expenses in 2024 include $1.5 million of transaction-related costs arising from the sale of our EMEA staffing operations. Excluding the impact from the sale and acquisition, as well as transaction, transformation and restructuring charges, SG&A expenses decreased 10.4% primarily due to structural workforce reductions as part of our transformation initiatives, as well as lower performance-based incentive compensation expenses in response to lower revenue volume.
Current wording
Total SG&A expenses decreased 4.1%, primarily due to the sale of our EMEA staffing operations, partially offset by the acquisition of MRP. Excluding these impacts, SG&A expenses decreased 7.0%. SG&A expenses in the third quarter of 2024 include $6.1 million of integration costs related to initiatives to integrate MRP and aligning Company processes and $3.1 million of transaction-related costs arising from the sale of our EMEA staffing operations and acquisition of MRP. Included in SG&A expenses in the third quarter of 2023 were $15.4 million of transformation and restructuring charges. Actions taken in the third quarter of 2023 were a continuation of the actions that were announced in the second quarter of 2023 as part of the comprehensive transformation initiative. In addition, excluding the impact from the sale and acquisition, as well as transaction, integration, transformation, and restructuring charges, SG&A expenses decreased 4.2% primarily due to proactive resource management and lower variable, performance-based incentive compensation expenses in response to lower revenue volume.
Previous wording
Earnings from operations for the second quarter of 2024 totaled $12.2 million, compared to $6.2 million in the second quarter of 2023. The increase is primarily related to the impact of lower SG&A compared to the prior year and the sale of the Ayers Group, partially offset by the adjustment to the gain on the sale of our EMEA staffing operations, the asset impairment charge and the impact of lower revenue compared to the prior year.
Current wording
Earnings from operations for the third quarter of 2024 totaled $2.6 million, compared to $0.1 million in the third quarter of 2023. The increase is primarily related to the impact of lower SG&A and partially offset by lower revenue compared to the prior year.
Previous wording
The net earnings for the period were $4.6 million, compared to $7.5 million for the second quarter of 2023.
Current wording
The net earnings for the period were $0.8 million, compared to $6.6 million for the third quarter of 2023.
Previous wording
Revenue from services in the first six months of 2024 decreased 15.4%, which primarily reflects the January 2, 2024 sale of our EMEA staffing operations, partially offset from an increase related to the acquisition of MRP in June 2024. Excluding the impact from the sale and the acquisition, revenue from services decreased 1.0%. This decline reflects revenue declines in the Professional & Industrial, Science, Engineering & Technology and Outsourcing & Consulting segments, partially offset by increases in the Education segment. Compared to the first six months of 2023 and excluding the impact from the sale and acquisition, revenue from staffing services increased 2.7% and revenue from outcome-based services decreased 5.4%. In addition, revenue from talent solutions decreased 1.4% and permanent placement revenue decreased 27.6% from the prior year, excluding the impact from the sale and the acquisition.
Current wording
Revenue from services in the first nine months of 2024 decreased 12.8%, which primarily reflects the January 2, 2024 sale of our EMEA staffing operations, partially offset by an increase related to the acquisition of MRP in May 2024. Excluding the impact from the sale and the acquisition, revenue from services decreased 0.8%. This decline reflects a revenue decline in the Professional & Industrial and Science, Engineering & Technology segments, partially offset by increases in the Education and Outsourcing & Consulting segments excluding the acquisition. Compared to the first nine months of 2023 and excluding the impact from the sale and acquisition, revenue from staffing services was flat to the prior year and revenue from outcome-based services decreased 5.1%. In addition, revenue from talent solutions increased 1.1% and permanent placement revenue decreased 28.5% from the prior year, excluding the impact from the sale and the acquisition.
Previous wording
Gross profit decreased 15.2% largely driven by the sale of our EMEA staffing operations, partially offset from an increase related to the acquisition of MRP. Excluding the impact from the sale and the acquisition, gross profit decreased 6.4%. The gross profit rate was flat to the prior year at 19.9% and was favorably impacted by the sale of our EMEA staffing operations and the acquisition of MRP. Excluding the impact from the sale and the acquisition, the gross profit rate declined 110 basis points. These decreases are due primarily to unfavorable business mix and a decrease in permanent placement revenue. Permanent placement revenue has very low direct costs of services and has a disproportionate impact on gross profit rates. The gross profit rate decreased in all segments on an organic basis, excluding the MRP acquisition.
Current wording
Gross profit decreased 11.4% largely driven by the sale of our EMEA staffing operations, partially offset by an increase related to the acquisition of MRP. Excluding the impact from the sale and the acquisition, gross profit decreased 6.4%. The gross profit rate increased 30 basis points to 20.4% and was favorably impacted by the sale of our EMEA staffing operations and the acquisition of MRP. Excluding the impact from the sale and the acquisition, the gross profit rate declined 120 basis points. These decreases are due primarily to business mix and a decrease in permanent placement revenue. Permanent placement revenue has very low direct costs of services and has a disproportionate impact on gross profit rates. The gross profit rate decreased in all segments excluding the sale and the acquisition.
Previous wording
Total SG&A expenses decreased 19.6%, primarily due to the sale of our EMEA staffing operations, partially offset by the acquisition of MRP. Excluding these impacts, SG&A expenses decreased 10.2%. Included in SG&A expenses in the first six months of 2024 and 2023 were $6.6 million and $12.2 million of transformation and restructuring charges, respectively. Actions taken in the first six months of 2024 and the second quarter of 2023 were a continuation of the actions that were announced in the second quarter of 2023 as part of the comprehensive transformation initiative. Actions taken in the first quarter of 2023 reflected management undertaking actions to further our cost management efforts in response to the demand levels and reflected a repositioning of our P&I staffing business to better capitalize on opportunities in local markets. In addition, SG&A expenses in 2024 include $7.1 million of transaction-related costs arising from the sale of our EMEA staffing operations. Excluding the impact from the sale and acquisition, as well as transaction, transformation and restructuring charges, SG&A expenses decreased 10.9% primarily due to structural workforce reductions as part of our transformation initiatives, as well as lower performance-based incentive compensation expenses in response to lower revenue volume.
Current wording
Total SG&A expenses decreased 14.6%, primarily due to the sale of our EMEA staffing operations, partially offset by the acquisition of MRP. Excluding these impacts, SG&A expenses decreased 9.2%. Included in SG&A expenses in the first nine months of 2024 and 2023 were $6.4 million and $27.6 million of restructuring charges, respectively. Actions taken in both periods were a continuation of the actions that were announced in the second quarter of 2023 as part of the comprehensive transformation initiative. In addition, restructuring actions taken in the first quarter of 2023 reflected management undertaking actions to further our cost management efforts in response to the demand levels and reflected a repositioning of our P&I staffing business to better capitalize on opportunities in local markets. SG&A expenses in 2024 also include $10.3 million of transaction-related costs arising from the sale of our EMEA staffing operations and acquisition of MRP and $6.1 million of integration costs related to initiatives to integrate MRP and aligning Company processes. Excluding the impact from the sale and acquisition, as well as transaction, integration, and restructuring charges, SG&A expenses decreased 8.8% primarily due to structural workforce reductions as part of our transformation initiatives, as well as proactive resource management and lower variable, performance-based incentive compensation expenses in response to lower revenue volume.
Previous wording
The gain on sale of EMEA staffing operations relates to the completion of the sale in January 2024 in which we have recognized a gain of $1.6 million in the first six months of 2024. The gain on sale of assets represents the sale of the Company's Ayers Group in which we have recognized a gain of $5.5 million in the second quarter 2024.
Current wording
The gain on sale of EMEA staffing operations relates to the completion of the sale in January 2024 in which we have recognized a gain of $1.6 million in the first nine months of 2024. The gain on sale of assets represents the sale of the Company's Ayers Group in the second quarter of 2024 in which we recognized a gain of $5.4 million in the first nine months of 2024.
Previous wording
Impairment of assets in the second quarter of 2024 represents the impairment of certain right-of-use assets related to our leased headquarters facility. Impairment of assets in the second quarter of 2023 represents the impairment of right-of-use assets related to an unoccupied office space lease exited in the quarter.
Current wording
Impairment of assets in the second quarter of 2024 represents the impairment of certain right-of-use assets related to our leased headquarters facility. Impairment of assets in the third quarter of 2023 represents the impairment of right-of-use assets related to an unoccupied office space lease exited in the quarter.
Previous wording
Earnings from operations for the first six months of 2024 totaled $39.0 million, compared to $16.9 million in the first six months of 2023. The increase is primarily related to the impact of lower SG&A compared to the prior year, a $5.6 million decrease in transformation and restructuring charges, the gain on sale of Ayers Group and the gain on sale of our EMEA staffing operations, partially offset by the asset impairment charge and the impact of lower revenue compared to the prior year.
Current wording
Earnings from operations for the first nine months of 2024 totaled $41.6 million, compared to $17.0 million in the first nine months of 2023. The increase is primarily related to the impact of lower SG&A compared to the prior year, the gain on sale of Ayers Group and the gain on sale of our EMEA staffing operations, partially offset by higher asset impairment charges and the impact of lower revenue compared to the prior year.
Previous wording
Income tax expense was $5.1 million for the first six months of 2024 compared to an income tax benefit of $0.1 million for the first six months of 2023. The change primarily relates to changes in pre-tax income.
Current wording
Income tax expense was $2.5 million for the first nine months of 2024 compared to an income tax benefit of $5.0 million for the first nine months of 2023. The change primarily relates to changes in pre-tax income and the impact of a deferred tax valuation allowance release in 2023.
Previous wording
The net earnings for the period were $30.4 million, compared to $18.4 million for the first six months of 2023.
Current wording
The net earnings for the period were $31.2 million, compared to $25.0 million for the first nine months of 2023.
Previous wording
Professional & Industrial revenue from services decreased 8.5%. The decrease was due primarily to an 8.6% decline in revenue from staffing services resulting from lower hours volume, partially offset by higher bill rates. Revenue from outcome-based services decreased by 7.4% due primarily from lower demand for our call-center solutions. Revenue from permanent placement fees declined 36.9%.
Current wording
Professional & Industrial revenue from services decreased 2.0%. The decrease was due primarily to a 2.7% decline in revenue from staffing services resulting from lower hours volume, partially offset by higher bill rates. Revenue from outcome-based services was flat year-over-year while revenue from permanent placement fees declined 24.1% as a result of continued lower market demand.
Previous wording
Science, Engineering & Technology revenue from services increased 10.2%. The revenue increase was primarily driven by the acquisition of MRP. Excluding the acquisition, revenue from services decreased 3.1%, primarily due to declines in hours volume in our staffing specialties, partially offset by higher bill rates. On an organic basis, revenue in our outcome-based services decreased 1.4% and permanent placement fees decreased 20.3%.
Current wording
Science, Engineering & Technology revenue from services increased 37.1%. The revenue increase was primarily driven by the acquisition of MRP. Excluding the acquisition, revenue from services decreased 5.1%, primarily due to declines in hours volume in our staffing specialties, partially offset by higher bill rates. Excluding the acquisition, revenue in our outcome-based services decreased 4.9% and permanent placement fees decreased 30.5%, reflecting continued lower market demand.
Previous wording
Education revenue from services increased 21.7%, driven by increased demand for our services as compared to a year ago, reflecting the impact of net new customer wins and improving demand from existing customers and the impact of higher fill rates.
Current wording
Education revenue from services increased 10.9%, driven by increased demand for our services as compared to a year ago, reflecting the impact of net new customer wins and the impact of higher fill rates.
Previous wording
Outsourcing & Consulting revenue from services increased 2.9% as revenue increased in PPO, partially offset by declines in RPO and MSP.
Current wording
Outsourcing & Consulting revenue from services increased 6.0% as revenue increased in PPO, partially offset by declines in MSP and RPO.
Previous wording
Professional & Industrial revenue from services decreased 9.8%. The decrease was due primarily to a 11.3% decline in staffing services resulting from lower hours volume, partially offset by higher bill rates. Revenue from outcome-based services decreased 5.6% due to lower demand for our call-center solutions. Revenue from permanent placement fees declined 39.9%.
Current wording
Professional & Industrial revenue from services decreased 7.3%. The decrease was due primarily to an 8.5% decline in staffing services resulting from lower hours volume, partially offset by higher bill rates. Revenue from outcome-based services decreased 3.8% due to lower demand for our call-center solutions. Revenue from permanent placement fees declined 35.3% as a result of continued lower market demand.
Previous wording
Science, Engineering & Technology revenue from services increased 2.2%. The increase was primarily driven by the acquisition of MRP in June 2024. Excluding the acquisition, revenue from services decreased 4.3%, primarily due to declines in hours volume in our staffing specialties, partially offset by higher bill rates. On an organic basis, permanent placement fees were down 22.1% and revenues from outcome-based services decreased 5.1%.
Current wording
Science, Engineering & Technology revenue from services increased 13.6%. The increase was primarily driven by the acquisition of MRP in May 2024. Excluding the acquisition, revenue from services decreased 4.6%, primarily due to declines in hours volume in our staffing specialties, partially offset by higher bill rates. Excluding the acquisition, permanent placement fees were down 24.6% reflecting continued lower market demand and revenues from outcome-based services decreased 6.7%.
Previous wording
Education revenue from services increased 18.7%, reflecting an increased demand for our services as compared to a year ago. Increased demand for our services reflects new customer wins and an increased fill rate related to demand of existing customers.
Current wording
Education revenue from services increased 17.0%, reflecting an increased demand for our services as compared to a year ago. Increased demand for our services reflects new customer wins and an increased fill rate related to demand of existing customers.
Previous wording
Outsourcing & Consulting revenue from services decreased 1.4% as revenue decreased in RPO and MSP, partially offset by increases in PPO revenue.
Current wording
Outsourcing & Consulting revenue from services increased 1.1% as revenue increased in PPO, partially offset by declines in RPO and MSP.
Previous wording
Gross profit for the Professional & Industrial segment decreased on lower revenue volume. In comparison to the prior year, the gross profit rate decreased 10 basis points. This decrease reflects lower permanent placement revenues and unfavorable business mix, partially offset by lower employee-related costs.
Current wording
Gross profit for the Professional & Industrial segment decreased on lower revenue volume. In comparison to the prior year, the gross profit rate decreased by 40 basis points primarily due to declines in permanent placement revenues and business mix which were partially offset by lower employee-related costs.
Previous wording
The Science, Engineering & Technology gross profit increased primarily as a result of the acquisition of MRP. The gross profit rate also increased 100 basis points due to the acquisition of MRP which generates higher gross profit rates. This impact was partially offset by a 30 basis point decrease in the gross profit rate in other SET specialties reflecting lower permanent placement fees and unfavorable business mix, partially offset by lower employee-related costs.
Current wording
The Science, Engineering & Technology gross profit increased primarily as a result of the acquisition of MRP. The gross profit rate increased 190 basis points due to the acquisition of MRP which generates higher gross profit rates. This impact was partially offset by a 50 basis point decrease in the gross profit rate in other SET specialties reflecting lower permanent placement fees and business mix, partially offset by lower employee-related costs.
Previous wording
Gross profit for the Education segment increased on higher revenue volume. The gross profit rate decreased 110 basis points due primarily to unfavorable customer mix.
Current wording
Gross profit for the Education segment was flat year-over-year despite higher revenue volume. The gross profit rate decreased 160 basis points due primarily to lower permanent placement fees, customer mix, and higher employee-related costs.
Previous wording
The Outsourcing & Consulting gross profit decreased with a decrease in the gross profit rate. The gross profit rate decreased 460 basis points primarily due to a change in business mix within this segment and higher employee-related costs in PPO. The unfavorable business mix was primarily driven by declines in revenue in RPO and MSP, which generates higher margins and improving PPO revenue which generates lower margins.
Current wording
The Outsourcing & Consulting gross profit decreased with a decrease in the gross profit rate. The gross profit rate decreased 630 basis points primarily due to a change in business mix within this segment and higher employee-related costs in PPO. The unfavorable business mix was primarily driven by declines in revenue in MSP and RPO, which generates higher margins and improving PPO revenue which generates lower margins.
Previous wording
Gross profit for the Professional & Industrial segment decreased on lower revenue volume. In comparison to the prior year, the gross profit rate decreased 10 basis points. This decrease reflects lower permanent placement revenues, partially offset by improved business mix and lower employee-related costs.
Current wording
Gross profit for the Professional & Industrial segment decreased on lower revenue volume. In comparison to the prior year, the gross profit rate decreased 20 basis points primarily due to declines in permanent placement revenue and business mix which were partially offset by lower employee-related costs.
Previous wording
The Science, Engineering & Technology gross profit increased resulting from the acquisition of MRP, partially offset by the decrease in revenue volume in other specialties. The gross profit rate also decreased 10 basis points as the acquisition of MRP with favorable gross profit rates was more than offset by unfavorable business mix and lower permanent placement revenues in other specialties.
Current wording
The Science, Engineering & Technology gross profit increased resulting from the acquisition of MRP, partially offset by the decrease in revenue volume in other components of the segment. The gross profit rate increased 110 basis points due to the acquisition of MRP which generates higher gross profit rates. This impact was partially offset by a 70 basis point decrease in the gross profit rate in other components of SET reflecting business mix and lower permanent placement fees, partially offset by lower employee-related costs.
Previous wording
Gross profit for the Education segment increased on higher revenue volume. The gross profit rate decreased 120 basis points due primarily to unfavorable customer mix.
Current wording
Gross profit for the Education segment increased on higher revenue volume. The gross profit rate decreased 120 basis points due primarily to lower permanent placement fees, customer mix, and higher employee-related costs.
Previous wording
The Outsourcing & Consulting gross profit decreased on lower revenue volume, combined with a decrease in the gross profit rate. The gross profit rate decreased 410 basis points primarily due to a change in business mix within this segment and higher employee-related costs in PPO. The unfavorable business mix was primarily driven by declines in revenue in RPO and MSP, which generates higher margins and improving PPO revenue which generates lower margins.
Current wording
The Outsourcing & Consulting gross profit decreased with a decrease in the gross profit rate. The gross profit rate decreased 480 basis points primarily due to a change in business mix within this segment and higher employee-related costs in PPO. The unfavorable business mix was primarily driven by declines in revenue in RPO and MSP, which generates higher margins and improving PPO revenue which generates lower margins.
Previous wording
Total SG&A expenses excluding depreciation and amortization in Professional & Industrial decreased 14.8% from the prior year. The decrease is primarily due to lower employee-related costs as a result of cost management in response to lower revenue volume compared to the prior year, as well as the impact of transformation-related actions.
Current wording
Total SG&A expenses excluding depreciation and amortization in Professional & Industrial decreased 11.2% from the prior year. The decrease is primarily due to lower employee-related costs as a result of cost management in response to lower revenue volume compared to the prior year.
Previous wording
Total SG&A expenses excluding depreciation and amortization in Science, Engineering & Technology increased 5.6% primarily as a result of the acquisition of MRP. Excluding the acquisition, expenses decreased 11.5% from the prior year primarily due to lower employee-related costs reflecting the response to lower revenue volume compared to the prior year, as well as the impact of transformation-related actions.
Current wording
Total SG&A expenses excluding depreciation and amortization in Science, Engineering & Technology increased 56.6% primarily as a result of the acquisition of MRP. Excluding the acquisition, expenses decreased 5.9% from the prior year primarily due to lower employee-related costs reflecting the response to lower revenue volume compared to the prior year.
Previous wording
Total SG&A expenses excluding depreciation and amortization in Education increased 4.3% from the prior year primarily related to increased year-over-year revenue levels.
Current wording
Total SG&A expenses excluding depreciation and amortization in Education increased 3.3% from the prior year primarily related to increased year-over-year revenue levels.
Previous wording
Corporate expenses decreased 12.5% compared to the prior year, or 3.8% excluding restructuring and transformation charges of $3.7 million in the second quarter of 2024 and $5.1 million in the second quarter of 2023.
Current wording
Corporate expenses increased 1.5% compared to the prior year, or decreased 6.5% excluding $9.2 million of transaction and integration costs in the third quarter of 2024 and restructuring and transformation charges of $8.3 million in the third quarter of 2023.
Previous wording
Total SG&A expenses excluding depreciation and amortization in Professional & Industrial decreased 18.0% from the prior year, or 16.3% excluding restructuring charges of $0.4 million in the first six months of 2024 and $3.3 million in the first six months of 2023. The decrease excluding restructuring charges is primarily due to lower salary-related costs as a result of cost management in response to lower revenue volume compared to the prior year, as well as the impact of transformation-related actions.
Current wording
Total SG&A expenses excluding depreciation and amortization in Professional & Industrial decreased 15.9% from the prior year, or 12.9% excluding restructuring charges of $0.4 million in the first nine months of 2024 and $7.3 million in the first nine months of 2023. The decrease excluding restructuring charges is primarily due to lower salary-related costs as a result of cost management in response to lower revenue volume compared to the prior year, as well as the impact of transformation-related actions.
Previous wording
Total SG&A expenses excluding depreciation and amortization in Science, Engineering & Technology decreased 3.7%. Excluding the impact from the acquisition of MRP, expenses decreased 11.3% from the prior year primarily due to lower employee-related costs reflecting the response to lower revenue volume compared to the prior year, as well as the impact of transformation-related actions.
Current wording
Total SG&A expenses excluding depreciation and amortization in Science, Engineering & Technology increased 15.3%. Excluding the impact from the acquisition of MRP, expenses decreased 9.6% from the prior year primarily due to lower employee-related costs reflecting the response to lower revenue volume compared to the prior year, as well as the impact of transformation-related actions.
Previous wording
Total SG&A expenses excluding depreciation and amortization in Education increased 2.3% from the prior year. Costs related to increased year-over-year revenue levels were partially offset by the impact of transformation-related actions.
Current wording
Total SG&A expenses excluding depreciation and amortization in Education increased 2.6% from the prior year. Costs related to increased year-over-year revenue levels were partially offset by the impact of transformation-related actions.
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Previous report — wording carried elsewhere
The loss on sale of EMEA staffing operations relates to a second quarter net working capital adjustment of $10.0 million relating to the completion of the January 2024 sale in which we have recognized a gain of $1.6 year to date. The gain on sale of assets represents the sale of the Company's Ayers Group in which we have recognized a gain of $5.5 million in the second quarter 2024.
Previous report — wording carried elsewhere
Impairment of assets in the second quarter of 2024 represents the impairment of certain right-of-use assets related to our leased headquarters facility. Impairment of assets in the second quarter of 2023 represents the impairment of right-of-use assets related to an unoccupied office space lease exited in the quarter.
Previous report — wording carried elsewhere
Education reported profit of $12.7 million for the quarter, compared to $9.3 million a year ago. The change was primarily due to higher revenue and gross profit.