ManpowerGroup Inc
For the period ended Jun 30, 2024. Filed Aug 2, 2024.
View on SEC.govAbout this filing
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.
Jun 30, 2024 · Filed Aug 2, 2024
MAN$44.50-3.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-03.
0000950170-24-052961
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-02.
0000950170-24-090022
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 88 previous paragraphs and 133 current paragraphs.
27 unchanged; 48 reworded; 46 added; 13 removed; 0 previous and 12 current paragraphs rearranged.
Tables are not compared: 2 previous and 4 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 (46)
Current report
a revenue decrease in Northern Europe of -12.1% (-12.0% in constant currency) primarily driven by a $92.5 million decrease in demand for our Manpower and Experis staffing/interim services, a $20.9 million decrease in demand for our Experis solutions services and a $7.8 million decrease in our permanent recruitment services. Within our Northern Europe segment, we experienced revenue decreases in the United Kingdom of $37.7 million, the Nordics of $42.6 million, Germany of $24.8 million, the Netherlands of $2.4 million and Belgium of $4.0 million, which represented revenue decreases of -11.5%, -20.2%, -17.6%, -2.5% and -4.9%, respectively (-12.2%, -19.4%, -16.6%, -1.3% and -3.8%, respectively, in constant currency); and
Current report
a revenue decrease in APME of -9.7% (-2.0% in constant currency and 0.7% in organic constant currency) primarily driven by the $46.3 million unfavorable impact of currency exchange rates and a $20.4 million decrease in demand for our permanent recruitment services, partially offset by a $17.4 million increase in demand for our Manpower staffing services.
Current report
a 10 basis point favorable impact from increased career transition activity in Right Management as outplacement activity increased; and
Current report
a 10 basis point favorable impact due to the effects of currency exchange rates.
Current report
The -9.3% decrease in selling and administrative expenses in the second quarter of 2024 (-6.5% in constant currency and -6.4% in organic constant currency) was primarily attributed to:
Current report
a $20.4 million, or -2.8% decrease due to the impact of changes in currency exchange rates;
Current report
a $13.3 million, or -8.7% decrease (-5.8% in constant currency) in non-personnel costs, primarily due to a $6.4 million decrease in office lease and other office costs, a $5.5 million decrease in consulting and outside services costs associated with our technology and back-office transformation initiatives and a $1.4 million decrease in advertising and promotional expenses.
Current report
Selling and administrative expenses as a percent of revenues decreased 40 basis points in the second quarter of 2024 compared to the second quarter of 2023 due primarily to:
Current report
a 30 basis point favorable impact as a result of the restructuring costs incurred in the second quarter of 2023;
Current report
a 10 basis point favorable impact as personnel costs decreased as a percent of revenues, primarily due to percent of revenue decreases in salaries, bonuses and sales commissions as we saw the effects of restructuring actions taken in 2023; and
Current report
a 10 basis point favorable impact as non-personnel costs decreased as a percent of revenues, primarily due to percent of revenue decreases in office leases and consulting and outside services; partially offset by
Current report
Operating Results - Six Months Ended June 30, 2024 and 2023
Current report
a revenue decrease in the Americas of -5.7% (increase of 1.9% in constant currency) primarily driven by the $170.1 million unfavorable impact of currency exchange rates and a $9.9 million decrease in demand for our permanent recruitment services, partially offset by increased demand of $34.8 million for our Manpower and Experis staffing/interim services and a $9.6 million increase in demand for our Manpower solutions services. The United States, our largest market in the Americas, experienced a revenue decrease of -5.1% primarily driven by a $58.3 million decrease in demand for our Manpower and
Current report
Experis staffing/interim services and a $12.5 million decrease in demand for our permanent recruitment services, partially offset by a $4.6 million increase in demand for our Talent Solutions outplacement services;
Current report
a revenue decrease in Southern Europe of -5.0% (-4.6% in constant currency) primarily driven by a $185.0 million decrease in demand for our Manpower and Experis staffing/interim services, the $17.1 million unfavorable impact of currency exchange rates, a $12.0 million decrease in demand for our permanent recruitment services and a $9.7 million decrease in demand for our Manpower and Experis solutions services, partially offset by a $7.1 million increase in demand for our Talent Solutions outplacement services. France, the largest market in Southern Europe, experienced a revenue decrease of -5.9% (-5.8% in constant currency) primarily driven by a $140.4 million decrease in demand for our Manpower staffing services and a $4.2 million decrease in demand for our permanent recruitment services, partially offset by a $6.5 million increase in demand for our Talent Solutions outplacement services. Italy, our second-largest market in Southern Europe, experienced a revenue decrease of -4.6% (-4.6% in constant currency) primarily driven by a $40.6 million decrease in our Manpower staffing services and a $3.6 million decrease in demand for our permanent recruitment services, partially offset by a $2.6 million increase in demand for our Manpower solutions services;
Current report
a revenue decrease in Northern Europe of -11.1% (-12.1% in constant currency) primarily driven by a $182.5 million decrease in demand for our Manpower and Experis staffing/interim services, a $39.2 million decrease in demand for our Experis solutions services and an $18.4 million decrease in our permanent recruitment services, partially offset by the $19.6 million favorable impact of currency exchange rates and a $7.7 million increase in demand for our Talent Solutions outplacement and MSP services. Within our Northern Europe segment, we experienced revenue decreases in the United Kingdom of $72.9 million, the Nordics of $101.8 million, Germany of $33.3 million, the Netherlands of $5.7 million and Belgium of $0.6 million, which represented revenue decreases of -10.9%, -23.2%, -11.8%, -2.9 and -0.4%, respectively (-13.2%, -22.5%, -11.8%, -2.9% and -0.4%, respectively, in constant currency); and
Current report
a revenue decrease in APME of -10.7% (-3.4% in constant currency and -2.2% in organic constant currency) primarily driven by the $87.9 million unfavorable impact of currency exchange rates, a $45.8 million decrease in demand for our permanent recruitment services and a $10.4 million decrease in demand for our Experis solutions services, partially offset by a $19.3 million increase in demand for our Manpower and Experis staffing/interim services.
Current report
a 20 basis point favorable impact from increased career transition activity in Right Management as outplacement activity increased.
Current report
The -7.8% decrease in selling and administrative expenses in the first half of 2024 (-5.8% in constant currency and -5.7% in organic constant currency) was primarily attributed to:
Current report
a $50.8 million, or -6.9% decrease (-5.0% in constant currency) in personnel costs primarily due to a $37.7 million decrease in salary costs as we saw the effects of restructuring actions taken in 2023;
Current report
a $29.8 million, or -2.0% decrease due to the impact of changes in currency exchange rates;
Current report
the non-recurrence of restructuring costs in the first half of 2024 compared to $21.1 million incurred in the first half of 2023; and
Current report
a $16.4 million, or -6.0% decrease (-3.7% in constant currency) in non-personnel costs, primarily due to a $9.4 million decrease in office lease and other office costs and an $8.0 million decrease in consulting and outside services costs associated with our technology and back-office transformation initiatives.
Current report
a 10 basis point favorable impact as personnel costs as a percent of revenue decreased, primarily due to a percent of revenue decrease in salaries as we saw the effects of restructuring actions taken in 2023; partially offset by
Current report
Weighted average shares - diluted decreased to 48.7 million in the first half of 2024 from 51.0 million in the first half of 2023. This decrease was due to the impact of share repurchases completed since the first half of 2023, partially offset by grants of share-based awards.
Current report
In the Americas, revenues from services decreased -5.7% (increase of 1.9% in constant currency) in the first half of 2024 compared to the first half of 2023. In the United States, revenues from services decreased -5.1% in the first half of 2024 compared to the first half of 2023, primarily driven by a $58.3 million decrease in demand for our Manpower and Experis staffing/interim services and a $12.5 million decrease in demand for our permanent recruitment services, partially offset by a $4.6 million increase in demand for our Talent Solutions outplacement services. In Other Americas, revenues from services decreased -7.0% (increase of 14.8% in constant currency) in the first half of 2024 compared to the first half of 2023, primarily driven by the $170.1 million unfavorable impact of foreign currency exchange rates, partially offset by a $98.8 million increase in demand for our Manpower and Experis staffing/interim services. The constant currency increase in Other Americas was primarily due to inflation in Argentina. Within our Other Americas segment, we experienced decreases in Argentina and Canada of $38.4 million, or -39.9%, and $29.1 million, or -15.6%, respectively (+144.4% and -14.9%, respectively, in constant currency), partially offset by a revenue increase in Mexico of $17.6 million, or 15.5% (8.9% in constant currency).
Current report
Selling and administrative expenses decreased -7.6% (-2.3% in constant currency) in the second quarter of 2024 compared to the second quarter of 2023, primarily driven by the $11.5 million favorable impact of currency exchange rates and a $2.8 million decrease in consulting and outside services costs associated with our technology and back-office transformation initiatives.
Current report
Selling and administrative expenses decreased -5.4% (-0.5% in constant currency) in the first half of 2024 compared to the first half of 2023, primarily driven by the $21.2 million favorable impact of currency exchange rates and a $1.7 million decrease in salaries from a reduction in headcount.
Current report
OUP decreased -22.5% (-17.6% in constant currency), in the first half of 2024, which represents a 3.4% OUP margin, a decrease from 4.1% in the first half of 2023. This decrease was primarily due to decreased profitability in our United States business of $13.8 million, which experienced decreased activity in our higher-margin permanent recruitment business, as noted above, partially offset by decreases to selling and administrative expenses. In the United States, OUP margin decreased to 2.9% in the first half of 2024 from 3.7% in the first half of 2023 primarily due to decreased activity in our higher-margin permanent recruitment and Manpower staffing businesses, as noted above, partially offset by a decrease in our selling and administrative expenses as a percent of revenue. Other Americas OUP margin decreased to 4.4% in the first half of 2024 from 5.0% in the first half of 2023 primarily due to an increase in our selling and administrative expenses as a percent of revenue.
Current report
In Southern Europe, revenues from services decreased -5.8% ( -4.4% in constant currency) in the second quarter of 2024 compared to the second quarter of 2023. In France (which represents 56% of Southern Europe’s revenues), revenues from services decreased -7.3% (-6.2% in constant currency) in the second quarter of 2024 compared to the second quarter of 2023, primarily driven by an $80.5 million decrease in demand for our Manpower staffing services and the $13.9 million unfavorable impact of currency exchange rates, partially offset by a $4.6 million increase in demand for our Talent Solutions outplacement services. In Italy (which represents 21% of Southern Europe’s revenues), revenues from services decreased -5.0% (-3.9% in constant currency) in the second quarter of 2024 compared to the second quarter of 2023, primarily driven by an $18.6 million decrease in our Manpower staffing services and the $4.9 million unfavorable impact of currency exchange rates, partially offset by a $3.0 million increase in demand for our Manpower solutions services. In Other Southern Europe, revenues from services decreased -2.6% (0.0% in constant currency) in the second quarter of 2024 compared to the second quarter of 2023, primarily due to the $13.0 million unfavorable impact of currency exchange rates, partially offset by a $4.4 million increase in demand for our Manpower and Experis staffing/interim services. Within our Other Southern Europe segment, we experienced a revenue decrease in Switzerland of $14.8 million, or -11.8% (-11.3% in constant currency), partially offset by a revenue increase in Spain of $1.6 million, or 1.3% (2.5% in constant currency).
Current report
In Southern Europe, revenues from services decreased -5.0% (-4.6% in constant currency) in the first half of 2024 compared to the first half of 2023. In France, revenues from services decreased -5.9% (-5.8% in constant currency) in the first half of 2024 compared to the first half of 2023, primarily driven by a $140.4 million decrease in demand for our Manpower staffing services and a $4.2 million decrease in demand for our permanent recruitment services, partially offset by a $6.5 million increase in demand for our Talent Solutions outplacement services. In Italy, revenues from services decreased -4.6% (-4.6% in constant currency) in the first half of 2024 compared to the first half of 2023, primarily driven by a $40.6 million decrease in our Manpower staffing services and a $3.6 million decrease in demand for our permanent recruitment services, partially offset by a $2.6 million increase in demand for our Manpower solutions services. In Other Southern Europe, revenues from services decreased -3.3% (-1.6% in constant currency) during the first half of 2024 compared to the first half of 2023, primarily driven by the $15.8 million unfavorable impact of currency exchange rates and a $11.4 million decrease in demand for our Experis solutions services. Within our Other Southern Europe segment, we experienced revenue decreases in Spain and Switzerland of $6.6 million, or -2.8% and $23.6 million, or -9.8%, respectively (-2.7% and -11.9%, respectively, in constant currency).
Current report
Gross profit margin decreased 30 basis points in the second quarter of 2024 compared to the second quarter of 2023. The decrease was primarily due to decreased activity in our higher margin Manpower staffing services, which contributed 20 basis points to the decrease and decreased activity in our permanent recruitment services, which contributed 20 basis points to the decrease. These contributions were partially offset by increased demand in our higher-margin Right Management outplacement business which had a 10 basis point offsetting impact.
Current report
Selling and administrative expenses decreased -6.6% (-5.2% in constant currency) during the second quarter of 2024 compared to the second quarter of 2023, primarily due to the non-recurrence of $6.0 million in restructuring costs, the $3.3 million favorable impact of currency exchange rates, and a $2.4 million decrease in salary-related costs.
Current report
OUP decreased -16.1% (-15.7% in constant currency) in the first half of 2024, which represents a 3.8% OUP margin, a decrease from 4.2% in the first half of 2023. This OUP decrease was primarily due to decreased profitability in the France reporting unit of $21.0 million. In France, the OUP margin decreased to 3.2% for the first half of 2024 compared to 3.9% for the first half of 2023 primarily driven by an increase in selling and administrative expenses as a percent of revenue and a decrease in overall gross profit margin as we saw decreases in our higher-margin permanent recruitment business. In Italy, the OUP margin decreased to 7.3% for the first half of 2024 from 7.6% for the first half of 2023 primarily driven by an increase selling and administrative expenses as a percent of revenue, partially offset by an increase in gross profit margin. In Other Southern Europe, the OUP margin decreased to 2.0% for the first half of 2024 from 2.2% for the first half of 2023 primarily due to a decrease in gross profit margin as we saw decreased activity in higher-margin business solutions services, as noted above, partially offset by a decrease in selling and administrative expenses as a percent of revenue.
Current report
In the Northern Europe region, revenues from services decreased -11.1% (-12.1% in constant currency) in the first half of 2024 compared to the first half of 2023. Within our Northern Europe segment, we experienced revenue decreases in the United Kingdom of
Current report
$72.9 million, the Nordics of $101.8 million, Germany of $33.3 million, the Netherlands of $5.7 million and Belgium of $0.6 million, which represented revenue decreases of -10.9%, -23.2%, -11.8%, -2.9 and -0.4%, respectively (-13.2%, -22.5%, -11.8%, -2.9% and -0.4%, respectively, in constant currency). The revenue decrease in Northern Europe was primarily driven by a $182.5 million decrease in demand for our Manpower and Experis staffing/interim services, a $39.2 million decrease in demand for our Experis solutions services and a $18.4 million decrease in our permanent recruitment services, partially offset by the $19.6 million favorable impact of currency exchange rates and a $7.7 million increase in demand for our Talent Solutions outplacement and MSP services.
Current report
Gross profit margin increased by 30 basis points in the second quarter of 2024 compared to the second quarter of 2023 primarily due to a shift in business mix towards our higher-margin Talent Solutions outplacement and MSP services, which contributed 60 basis points to the increase, partially offset by a decreased activity in our higher-margin permanent recruitment business, which had a 30 basis point offsetting impact.
Current report
Selling and administrative expenses decreased -14.3% (-14.1% in constant currency) in the second quarter of 2024 compared to the second quarter of 2023. The decrease is primarily driven by a $14.9 million decrease in total personnel costs as we experience the impacts of significant restructuring action taken in 2023 and no restructuring costs incurred in the second quarter of 2024 compared to $7.7 million in second quarter of 2023.
Current report
Selling and administrative expenses decreased -12.9% (-13.7% in constant currency) in the first half of 2024 compared to the first half of 2023. The decrease is primarily driven by a $30.4 million decrease in total personnel costs as we experience the impacts of significant restructuring actions taken in 2023 and no restructuring costs incurred in the first half of 2024 compared to $10.3 million in the first half of 2023.
Current report
OUP in Northern Europe increased 75.6% (73.1% in constant currency) in the second quarter of 2024, which represents a -0.3% OUP margin, an increase from -1.0% in the second quarter of 2023. This OUP increase was primarily driven by an increase in profitability of our bench model countries, notably the Nordics, Germany and the Netherlands which experienced increases of $4.2 million, $5.0 million and $1.4 million, respectively. The OUP increase was also driven by a decrease in selling and administrative expenses as we saw the effects of restructuring actions taken in the prior year period, as noted above.
Showing the first 40 of 46 passages. Open the source sections for the rest.
Removed paragraphs (13)
Previous report
a revenue decrease in Northern Europe of -10.1% (-12.1% in constant currency), primarily due to decreased demand of $89.9 million for our Manpower and Experis staffing/interim services, decreased demand of $18.3 million for our Experis Solutions services and decreased demand of $10.6 million in our permanent recruitment business, partially offset by the $20.1 million favorable impact of foreign currency exchange rates. Within Northern Europe, we experienced revenue decreases in the United Kingdom of $35.1 million, the Nordics of $59.2 million, Germany of $8.4 million and the Netherlands of $3.3 million, which represented revenue decreases of -10.4%, -26.1%, -6.0% and -3.3%, respectively (-14.1%, -25.3%, -7.0% and -4.4%, respectively, in constant currency). These decreases were partially offset by a revenue increase in Belgium of $3.3 million, which represented a revenue increase of 4.7% (3.5% in constant currency); and
Previous report
a revenue decrease in APME of -11.7% (-4.8% in constant currency and -3.6% in organic constant currency) primarily due to the $41.6 million unfavorable impact of foreign currency exchange rates and decreased activity of $25.6 million in our RPO permanent recruitment business driven by the non-recurrence of a government contract from the prior year period, partially offset by increased demand of $4.1 million for our Manpower and Experis staffing/interim services.
Previous report
a 20 basis point unfavorable impact due to operational losses from our Proservia business in Germany that we are exiting; partially offset by
Previous report
a 20 basis point favorable impact from increases in our higher-margin Right Management outplacement business as we continued to experience increased activity; and
Previous report
a 10 basis point favorable impact from foreign currency exchange rates.
Previous report
The -6.4% decrease in selling and administrative expenses in the first quarter of 2024 (-5.1% in constant currency and -5.0% in organic constant currency) was primarily attributed to:
Previous report
a $9.4 million, or -1.3% decrease due to the impact of changes in currency exchange rates;
Previous report
a $2.6 million, or -2.9% decrease (-1.2% in constant currency) in non-personnel costs, primarily due to a $3.1 million decrease in office lease costs and $2.5 million decrease in consulting and outside services costs associated with our technology and back-office transformation initiatives, partially offset by a $2.6 million increase in bad debt.
Previous report
In Southern Europe, revenues from services decreased -4.2% (-4.9% in constant currency) in the first quarter of 2024 compared to the first quarter of 2023. In France (which represents 56% of Southern Europe’s revenues), revenues from services decreased -4.3% (-5.4% in constant currency) in the first quarter of 2024 compared to the first quarter of 2023. The decrease in France is primarily due to decreased demand of $60.0 million for our Manpower staffing services, partially offset by the $12.9 million favorable impact of foreign currency exchange rates. In Italy (which represents 20% of Southern Europe’s revenues), revenues from services decreased -4.2% (-5.4% in constant currency) in the first quarter of 2024 compared to the first quarter of 2023. The decrease in Italy was primarily due to decreased demand of $21.2 million for our Manpower and Experis staffing/interim services, partially offset by the $4.7 million favorable impact of foreign currency exchange rates. In Other Southern Europe, revenues from services decreased -3.9% (-3.3% in constant currency) in 2024 compared to 2023, primarily due to decreased demand of $8.1 million for our Manpower and Experis staffing/interim services and $5.3 million for our Experis solutions services. The decrease in Other Southern Europe was driven by revenue decreases in Spain and Switzerland of $8.2 million, or -6.9%, and $8.8 million, or -7.6%, respectively (-8.0% and -12.6%, respectively, in constant currency).
Previous report
Selling and administrative expenses decreased -2.2% (-3.1% in constant currency) during the first quarter of 2024 compared to the first quarter of 2023 primarily due to a $3.6 million decrease in salary-related costs, partially offset by the $1.9 million unfavorable impact of currency exchange rates.
Previous report
Selling and administrative expenses decreased -11.5% (-13.3% in constant currency) in the first quarter of 2024 compared to the first quarter of 2023. The decrease is primarily due to the $10.2 million decrease in salary costs due to headcount reductions, the $3.4 million decrease to consulting and other outside services, the $3.3 million decrease in bonuses and sales commissions as a result of decreased profitability in certain markets and no restructuring costs incurred in 2024 compared to $2.5 million in 2023. These decreases were partially offset by the $3.0 million unfavorable impact of currency exchange rates.
Previous report
OUP in APME decreased -6.1% (increases of 3.3% in constant currency and 4.7% in organic constant currency) which represents a 3.7% OUP margin, an increase from 3.5% in the first quarter of 2023. This OUP decrease was primarily driven by decreased profitability in Japan reporting unit of $0.8 million, partially offset by decreases to selling and administrative expenses, as noted above.
Previous report
Net debt borrowings were $3.5 million in the three months ended March 31, 2024 as compared to net repayments of $10.7 million in the three months ended March 31, 2023.
Reworded paragraphs (48)
Previous wording
Our business is cyclical in nature and is sensitive to macroeconomic conditions generally. Client demand for workforce solutions and services is dependent on the overall strength of the labor market and secular trends toward greater workforce flexibility within each of the segments where we operate. Improving economic growth typically results in increasing demand for labor, resulting in greater demand for our staffing services while demand for our outplacement services typically declines. During periods of decreased demand, as we experienced in the first quarter of 2024, our operating profit is generally impacted unfavorably as we experience a deleveraging of selling and administrative expenses, which may not decline at the same pace as revenues. By contrast, during periods of increased demand we are generally able to improve our profitability and operating leverage as our cost base can support some increase in business without a similar increase in selling and administrative expenses.
Current wording
Our business is cyclical in nature and is sensitive to macroeconomic conditions generally. Client demand for workforce solutions and services is dependent on the overall strength of the labor market and secular trends toward greater workforce flexibility within each of the segments where we operate. Improving economic growth typically results in increasing demand for labor, resulting in greater demand for our staffing services while demand for our outplacement services typically declines. During periods of decreased demand, as we experienced in the second quarter of 2024, our operating profit is generally impacted unfavorably as we experience a deleveraging of selling and administrative expenses, which may not decline at the same pace as revenues. By contrast, during periods of increased demand, we are generally able to improve our profitability and operating leverage as our cost base can support some increase in business without a similar increase in selling and administrative expenses.
Previous wording
In the first quarter of 2024, we continued to observe decreased demand for staffing services and permanent recruitment services due to increased economic uncertainty, and we expect this trend to continue. The economic uncertainty is particularly high in Europe and the United States, driven by elevated inflation and higher interest rates. As a result of these factors, we expect the business environment will continue to be challenging for us in future periods, especially in North America and Europe, with many companies delaying hiring decisions or reducing their demand for contingent labor. The current economic uncertainty is exacerbated by increasing geopolitical tensions, which could further negatively impact our operations in future periods.
Current wording
In the second quarter of 2024, we continued to observe decreased demand for staffing services and permanent recruitment services primarily due to increased economic uncertainty, and we expect this trend to continue. The economic uncertainty is particularly high in Europe and the United States, driven by elevated inflation and higher interest rates. As a result of these factors, we expect the business environment will continue to be challenging for us in future periods, especially in the United States and Europe, with many companies delaying hiring decisions or reducing their demand for contingent labor. The current economic uncertainty is exacerbated by increasing geopolitical tensions, which could further negatively impact our operations in future periods.
Previous wording
During the first quarter of 2024, the United States dollar was generally stable, on average, relative to the currencies in most of our markets, and overall had a slight unfavorable impact on our reported results. The changes in the foreign currency exchange rates had a -1.8% unfavorable impact on revenues from services and an approximately $0.04 per share unfavorable impact on net earnings per share – diluted in the quarter. Substantially all of our subsidiaries derive revenues from services and incur expenses within the same local currency and generally do not have cross-currency transactions, and therefore, changes in foreign currency exchange rates primarily impact reported earnings and not our actual cash flow unless earnings are repatriated. To understand the performance of our underlying business, we utilize constant currency or organic constant currency variances for our consolidated and segment results.
Current wording
During the second quarter of 2024, the United States dollar was generally stable, on average, relative to the currencies in most of our markets, and overall had a slight unfavorable impact on our reported results. The changes in the foreign currency exchange rates had a -3.4% unfavorable impact on revenues from services and an approximately $0.05 per share unfavorable impact on net earnings per share – diluted in the quarter. Substantially all of our subsidiaries derive revenues from services and incur expenses within the same local currency and generally do not have cross-currency transactions, and therefore, changes in foreign currency exchange rates primarily impact reported earnings and not our actual cash flow unless earnings are repatriated. To understand the performance of our underlying business, we utilize constant currency or organic constant currency variances for our consolidated and segment results.
Previous wording
During the first quarter of 2024 compared to the first quarter of 2023, we experienced an -8.3% revenue decrease in the Americas, primarily driven by decreased demand for our Manpower and Experis staffing/interim services, decreased demand for our permanent recruitment services, a decrease in our TAPFIN - Managed Service Provider (MSP) business as we exited lower margin arrangements and the unfavorable impact of currency exchange rates. During the first quarter of 2024 compared to the first quarter of 2023, we experienced a -4.2% revenue decrease in Southern Europe, primarily due to decreased demand for our Manpower staffing services, partially offset by the favorable impact of currency exchange rates. During the first quarter of 2024 compared to the first quarter of 2023, we experienced a -10.1% revenue decrease in Northern Europe, primarily due to a decreased demand for our Manpower and Experis staffing/interim services, decreased demand in our permanent recruitment business and decreased demand for our Experis outcome-based solutions and consulting services, partially offset by the favorable impact of foreign currency exchange rates. We experienced an -11.7% revenue decrease in APME in the first quarter of 2024 compared to the first quarter of 2023 primarily due to the unfavorable impact of foreign currency exchange rates and decreased activity in our RPO permanent recruitment business driven by the non-recurrence of a government contract from the prior year period, partially offset by increased demand for our Manpower and Experis staffing/interim services.
Current wording
During the second quarter of 2024 compared to the second quarter of 2023, we experienced a -3.1% revenue decrease in the Americas, primarily driven by the unfavorable impact of currency exchange rates and decreased demand for our permanent recruitment services, partially offset by increased demand for our Manpower staffing services. During the second quarter of 2024 compared to the second quarter of 2023, we experienced a -5.8% revenue decrease in Southern Europe, primarily due to decreased demand for our Manpower staffing services, the unfavorable impact of currency exchange rates and decreased demand for our permanent recruitment services. During the second quarter of 2024 compared to the second quarter of 2023, we experienced a -12.1% revenue decrease in Northern Europe, primarily due to a decreased demand for our Manpower and Experis staffing/interim services, decreased demand for our Experis Solutions services, and decreased demand for our permanent recruitment services. We experienced a -9.7% revenue decrease in APME in the second quarter of 2024 compared to the second quarter of 2023 primarily due to the unfavorable impact of currency exchange rates and decreased demand for our permanent recruitment services.
Previous wording
From a brand perspective, we experienced revenue decreases in Manpower, Experis and Talent Solutions in the first quarter of 2024 compared to the first quarter of 2023. In our Manpower brand, the revenue decrease was primarily due to decreased demand for staffing services, our permanent recruitment services and our Manpower Solutions services. The revenue decrease in our Experis brand was primarily due to decreased demand for interim services, our permanent recruitment services and our Experis Solutions services. On an overall basis, the revenue decrease in our Talent Solutions brand, which includes RPO, MSP and our Right Management offerings, was primarily due to decreased demand for our RPO permanent recruitment offerings. This revenue decrease in Talent Solutions was partially offset by an increase in demand for our Right Management outplacement services.
Current wording
From a brand perspective, we experienced revenue decreases in Manpower, Experis and Talent Solutions in the second quarter of 2024 compared to the second quarter of 2023. In our Manpower brand, the revenue decrease was primarily due to decreased demand for staffing services and our permanent recruitment services. The revenue decrease in our Experis brand was primarily due to decreased demand for interim services, our Experis Solutions services and our permanent recruitment services. On an overall basis, the revenue decrease in our Talent Solutions brand, which includes RPO, MSP and our Right Management offerings, was primarily due to decreased demand for our RPO permanent recruitment offerings. This revenue decrease in Talent Solutions was partially offset by an increase in demand for our Right Management outplacement services and our MSP business.
Previous wording
In the first quarter of 2024 our gross profit margin decreased 90 basis points compared to the first quarter of 2023, primarily due to declines in our higher-margin permanent recruitment businesses and our Manpower and Experis staffing/interim services and the unfavorable impact of operational losses from our Proservia business in Germany that we are exiting. The decrease in gross profit margin in the first quarter of 2024 compared to the first quarter of 2023 was partially offset by growth in our higher-margin outplacement offerings within Right Management.
Current wording
In the second quarter of 2024, our gross profit margin decreased 40 basis points compared to the second quarter of 2023, primarily due to declines in our higher-margin permanent recruitment businesses, partially offset by growth in our higher-margin Talent Solutions outplacement business and our MSP businesses.
Previous wording
Our operating profit decreased -44.1% in the first quarter of 2024 while our operating profit margin decreased 100 basis points compared to the first quarter of 2023. Excluding the loss of $6.2 million in operating profit due to operational losses from our Proservia business in Germany in the first quarter of 2024 that we are exiting and restructuring costs of $6.6 million incurred in the first quarter of 2023, our operating profit decreased -42.1% while operating profit margin decreased 100 basis points compared to the first quarter of 2023. The operating profit margin decreased primarily due to a decrease in gross profit margin, as noted above.
Current wording
Our operating profit decreased -6.1% in the second quarter of 2024 while our operating profit margin remained the same compared to the second quarter of 2023. Excluding the loss of $2.9 million in operating profit due to operational losses from our Proservia business in Germany in the second quarter of 2024 that we are exiting and restructuring costs of $14.5 million incurred in the second quarter of 2023, our operating profit decreased -14.8%. Operating profit margin decreased 20 basis points compared to the second quarter of 2023. The operating profit margin decreased primarily due to a decrease in gross profit margin, as noted above.
Previous wording
The year-over-year decrease in revenues from services of -7.3% (-5.5% in constant currency) was attributed to:
Current wording
The year-over-year decrease in revenues from services of -6.9% (-3.5% in constant currency and -3.3% in organic constant currency) was attributed to:
Previous wording
a revenue decrease in the Americas of -8.3% (-1.1% in constant currency) primarily due to the $81.3 million unfavorable impact of foreign currency exchange rates, decreased demand of $12.8 million for our Manpower and Experis staffing/interim services, decreased activity of $6.3 million in our permanent recruitment business and a decrease of $2.9 million in our MSP business as we exited lower margin arrangements, partially offset by the increase in demand of $5.8 million for our Talent Solutions outplacement services. The United States, our largest market in the Americas, experienced a revenue decrease of -8.3% primarily driven by decreased demand of $55.4 million for our Manpower and Experis staffing/interim services, decreased activity of $7.1 million in our permanent recruitment business and a decrease of $3.0 million in our MSP business as we exited lower margin arrangements, partially offset by an increase in demand of $5.3 million in our Talent Solutions outplacement services;
Current wording
a revenue decrease in the Americas of -3.1% (increase of 5.0% in constant currency) primarily driven by the $88.8 million unfavorable impact of currency exchange rates and a $3.6 million decrease in demand for our permanent recruitment services, partially offset by increased demand of $61.9 million for our Manpower staffing services. The United States, our largest market in the Americas, experienced a revenue decrease of -1.7% primarily driven by a $5.3 million decrease in demand for our permanent recruitment services and a $3.9 million decrease in demand for our Manpower and Experis staffing/interim services;
Previous wording
a revenue decrease in Southern Europe of -4.2% (-4.9% in constant currency) which was primarily due to decreased demand of $85.5 million for our Manpower staffing services, partially offset by the $14.7 million favorable impact of changes in currency exchange rates. France, the largest market in Southern Europe, experienced a revenue decrease of -4.3% (-5.4% in constant currency), which was primarily due to decreased demand of $60.0 million for our Manpower staffing services, partially offset by the $12.9 million favorable impact of foreign currency exchange rates. Italy, our second-largest market in Southern Europe, experienced a revenue decrease of -4.2% (-5.4% in constant currency), which was primarily due to decreased demand of $21.2 million for our Manpower and Experis staffing/interim services, partially offset by the $4.7 million favorable impact of foreign currency exchange rates;
Current wording
a revenue decrease in Southern Europe of -5.8% (decrease of -4.4% in constant currency) primarily driven by a $90.3 million decrease in demand for our Manpower staffing services, the $31.8 million unfavorable impact of currency exchange rates and a $6.8 million decrease in demand for our permanent recruitment services, partially offset by a $4.7 million increase in demand for our Talent Solutions outplacement services. France, the largest market in Southern Europe, experienced a revenue decrease of -7.3% (-6.2% in constant currency) primarily driven by an $80.5 million decrease in demand for our Manpower staffing services and the $13.9 million unfavorable impact of currency exchange rates, partially offset by a $4.6 million increase in demand for our Talent Solutions outplacement services. Italy, our second-largest market in Southern Europe, experienced a revenue decrease of -5.0% (-3.9% in constant currency) primarily driven by an $18.6 million decrease in our Manpower staffing services and the $4.9 million unfavorable impact of currency exchange rates, partially offset by a $3.0 million increase in demand for our Manpower solutions services;
Previous wording
The year-over-year 90 basis point decrease in gross profit margin was primarily attributed to:
Current wording
The year-over-year 40 basis point decrease in gross profit margin was primarily attributed to:
Previous wording
a 50 basis point unfavorable impact from decreases to permanent recruitment, including Talent Solutions RPO, as permanent hiring demand continued to soften and experienced reduced levels;
Current wording
a 50 basis point unfavorable impact from decreases to permanent recruitment, including Talent Solutions RPO, as permanent hiring demand continued to soften and experienced reduced levels; and
Previous wording
a 50 basis point unfavorable impact from the decrease in staffing/interim margins due to mix shifts and lower volumes while pricing remained stable; and
Current wording
a 10 basis point unfavorable impact from the decrease in staffing/interim margins due to mix shifts and lower volumes while pricing remained stable; partially offset by
Previous wording
a $28.4 million, or -6.7% decrease (-5.5% in constant currency) in personnel costs primarily due to a $23.5 million decrease in salary costs as we saw the effects of restructuring actions taken throughout 2023;
Current wording
a $22.4 million, or -7.2% decrease (-4.5% in constant currency) in personnel costs primarily due to a $14.2 million decrease in salary costs as we saw the effects of restructuring actions taken in 2023;
Previous wording
the non-recurrence of restructuring costs in the first quarter of 2024 compared to $6.6 million incurred in the first quarter of 2023; and
Current wording
the non-recurrence of restructuring costs in the second quarter of 2024 compared to $14.5 million incurred in the second quarter of 2023; and
Previous wording
a 10 basis point unfavorable impact from changes in currency exchange rates; partially offset by
Current wording
a 10 basis point unfavorable impact from changes in currency exchange rates.
Previous wording
Interest and other expenses, net is comprised of interest, foreign exchange gains and losses and other miscellaneous non-operating income and expenses, including those associated with noncontrolling interests. Interest expense, net was $20.4 million in the first quarter of 2024 compared to $18.7 million in the first quarter of 2023 primarily due to increased revolver and other short term borrowings at a higher interest rate during the period. Foreign exchange loss, net was $2.4 million in the first quarter of 2024 compared to $3.1 million in the first quarter of 2023 primarily due to a reduction in foreign currency exchange losses year over year. Miscellaneous income, net was $8.1 million in both the first quarter of 2024 and 2023.
Current wording
Interest and other expenses, net is comprised of interest, foreign exchange gains and losses and other miscellaneous non-operating income and expenses, including those associated with noncontrolling interests. Interest expense, net was $13.4 million in the second quarter of 2024 compared to $11.6 million in the second quarter of 2023 primarily due to increased revolver and other short term borrowings at a higher interest rate during the period. Foreign exchange loss, net was $1.8 million in the second quarter of 2024 compared to $5.1 million in the second quarter of 2023 primarily due to a reduction in foreign currency exchange losses year over year. Miscellaneous income, net was $6.5 million in the second quarter of 2024 compared to $4.9 million in the second quarter of 2023.
Previous wording
We recorded income tax expense at an effective rate of 31.0% for the three months ended March 31, 2024, as compared to an effective rate of 29.5% for the three months ended March 31, 2023. The 2024 rate was unfavorably impacted by the overall mix of earnings and partially offset by the scheduled reduction in the French business tax rate from 0.38% to 0.28% effective January 1, 2024. The 31.0% effective tax rate for the three months ended March 31, 2024 was higher than the United States Federal statutory rate of 21% primarily due to the French business tax, tax losses in certain countries for which we did not recognize a corresponding tax benefit due to valuation allowances, and the overall mix of earnings.
Current wording
We recorded income tax expense at an effective rate of 34.9% for the three months ended June 30, 2024, as compared to an effective rate of 31.9% for the three months ended June 30, 2023. The 2024 rate was unfavorably impacted by the lower level and overall mix of earnings and partially offset by the scheduled reduction in the French business tax rate from 0.38% to 0.28% effective January 1, 2024. The 34.9% effective tax rate for the second quarter of 2024 was higher than the United States Federal statutory rate of 21% primarily due to the French business tax, tax losses in certain countries for which we did not recognize a corresponding tax benefit due to valuation allowances, and the overall mix of earnings.
Previous wording
Net earnings per share - diluted was $0.81 in the first quarter of 2024 compared to $1.51 in the first quarter of 2023. Losses related to our Proservia Germany wind down in the first quarter of 2024 unfavorably impacted net earnings per share - diluted by approximately $0.13, net of tax, in the first quarter of 2024.
Current wording
Net earnings per share - diluted was $1.24 in the second quarter of 2024 compared to $1.29 in the second quarter of 2023. Losses related to our Proservia Germany wind down in the second quarter of 2024 unfavorably impacted net earnings per share - diluted by approximately $0.06, net of tax, in the second quarter of 2024.
Previous wording
Weighted average shares - diluted decreased to 48.9 million in the first quarter of 2024 from 51.6 million in the first quarter of 2023. This decrease was due to the impact of share repurchases completed since the first quarter of 2023.
Current wording
Weighted average shares - diluted decreased to 48.4 million in the second quarter of 2024 from 50.7 million in the second quarter of 2023. This decrease was due to the impact of share repurchases completed since the second quarter of 2023, partially offset by grants of share-based awards.
Previous wording
Selling and administrative expenses as a percent of revenues increased 10 basis points in the first quarter of 2024 compared to the first quarter of 2023 due primarily to:
Current wording
Selling and administrative expenses as a percent of revenues decreased 10 basis points in the first half 2024 compared to the first half of 2023 due primarily to:
Previous wording
a 20 basis point favorable impact as a result of restructuring costs incurred in the first quarter of 2023.
Current wording
a 20 basis point favorable impact as a result of restructuring costs incurred in the first half of 2023 that did not recur in the first half of 2024; and
Previous wording
a 20 basis point unfavorable impact as non-personnel costs increased as a percent of revenues; and
Current wording
a 10 basis point unfavorable impact as non-personnel costs as a percent of revenues increased, primarily due to percent of revenue decreases in office leases and consulting and outside services; and
Previous wording
In the Americas, revenues from services decreased -8.3% (-1.1% in constant currency) in the first quarter of 2024 compared to the first quarter of 2023. In the United States (which represents 66% of the Americas' revenues), revenues from services decreased -8.3% in the first quarter of 2024 compared to the first quarter of 2023, primarily driven by decreased demand of $55.4 million for our Manpower and Experis staffing/interim services, decreased activity of $7.1 million in our permanent recruitment business and a decrease of $3.0 million in our MSP business as we exited lower margin arrangements, partially offset by an increase in demand of $5.3 million for our Talent Solutions outplacement services. In Other Americas, revenues from services decreased -8.4% (increase of 12.5% in constant currency) in the first quarter of 2024 compared to the first quarter of 2023 primarily due to the $81.3 million unfavorable impact of foreign currency exchange rates, partially offset by increased demand of $42.6 million for our Manpower and Experis staffing/interim services. The constant currency increase in Other Americas was primarily due to inflation in Argentina. The decrease in revenues from services in Other Americas was primarily driven by revenue decreases in Argentina and Canada of $18.8 million, or -40.7%, and $20.0 million, or -20.6%, respectively (+157.2% and -20.8%, respectively, in constant currency), partially offset by a revenue increase in Mexico of $11.2 million, or 20.5% (9.7% in constant currency).
Current wording
In the Americas, revenues from services decreased -3.1% (increase of 5.0% in constant currency) in the second quarter of 2024 compared to the second quarter of 2023. In the United States (which represents 65% of the Americas' revenues), revenues from services decreased -1.7% in the second quarter of 2024 compared to the second quarter of 2023, primarily driven by a $5.3 million decrease in demand for our permanent recruitment services and a $3.9 million decrease in demand for our Manpower and Experis staffing/interim services. In Other Americas, revenues from services decreased -5.7% (increase of 17.1% in constant currency) in the second quarter of 2024 compared to the second quarter of 2023, primarily driven by the $88.8 million unfavorable impact of foreign currency exchange rates, partially offset by a $56.3 million increase in demand for our Manpower and Experis staffing/interim services. The constant currency increase in Other Americas was primarily due to inflation in Argentina. Within our Other Americas segment, we experienced decreases in Argentina and Canada of $19.6 million, or -39.2%, and $9.1 million, or -10.2%, respectively (+132.5% and -8.5%, respectively, in constant currency), partially offset by a revenue increase in Mexico of $6.4 million, or 10.9% (8.1% in constant currency).
Previous wording
Gross profit margin decreased 70 basis points in the first quarter of 2024 compared to the first quarter of 2023 primarily due to decreased margins in our staffing and interim services, particularly within Experis, which contributed 110 basis points to the decrease, decreased activity in our permanent recruitment business which contributed 50 basis points to the decrease and decreased margins in our MSP business which contributed 20 basis points to the decrease. These contributions were partially offset by increased demand in our higher-margin Right Management outplacement business, which had a 50 basis point offsetting impact and the favorable impact of currency exchange rates, which had a 60 basis point offsetting impact.
Current wording
Gross profit margin decreased 70 basis points in the first half of 2024 compared to the first half of 2023 primarily due to decreased margins in our staffing and interim services, particularly within Experis, which contributed 80 basis points to the decrease, and decreased activity in our permanent recruitment business which contributed 50 basis points to the decrease. These contributions were partially offset by increased demand in our higher-margin Right Management outplacement business, which had a 10 basis point offsetting impact and the favorable impact of currency exchange rates, which had a 50 basis point offsetting impact.
Previous wording
Operating Unit Profit (“OUP”) decreased -46.4% (-43.0% in constant currency), which represents a 2.5% OUP margin, a decrease from 4.3% in the first quarter of 2023. This decrease was primarily due to decreased profitability in the United States business of $18.1 million, which includes the decreased demand for our Manpower and Experis staffing/interim services and decreased activity in our permanent recruitment business, as noted above. In the United States, OUP margin decreased to 1.8% in the first quarter of 2024 from 4.0% in the first quarter of 2023 primarily due to a decrease in gross profit margin as we saw decreased demand for our Manpower and Experis staffing/interim services and decreased activity in our RPO permanent recruitment business. The decrease was also due to an increase in our selling and administrative expenses as a percentage of revenue as we reduced costs slower than the decline in gross profit. Other Americas OUP margin decreased to 4.0% in the first quarter of 2024 from 4.8% in the first quarter of 2023 primarily due to an increase in our gross profit margin, specifically in our Manpower staffing services, partially offset by an increase in our selling and administrative expenses as a percent of revenue as we reduced costs slower than the decline in gross profit.
Current wording
Operating Unit Profit (“OUP”) increased 4.4% (10.9% in constant currency), in the second quarter of 2024, which represents a 4.2% OUP margin, an increase from 3.9% in the second quarter of 2023. This increase was primarily due to increased profitability in our United States business of $4.3 million, which experienced decreases to selling and administrative expenses, partially offset by decreases in higher-margin permanent recruitment revenues, as noted above. In the United States, OUP margin increased to 3.9% in the second quarter of 2024 from 3.3% in the second quarter of 2023 primarily due to a decrease in our selling and administrative expenses as a percent of revenue, partially offset by decreased activity in our higher-margin permanent recruitment business, as noted above. Other Americas OUP margin decreased to 4.8% in the second quarter of 2024 from 5.2% in the second quarter of 2023 primarily due to an increase in our selling and administrative expenses as a percent of revenue, partially offset by an increase in our gross profit margin as we saw a change in business mix towards higher margin Manpower staffing work.
Previous wording
Gross profit margin decreased 60 basis points in 2024 compared to 2023. The decrease was primarily due to decreased activity in our higher margin Manpower staffing services, which contributed 30 basis points to the decrease, decreased activity in our permanent recruitment services which contributed 20 basis points to the decrease and decreased activity in our Experis solutions services which contributed 20 basis points to the decrease. These contributions were partially offset by increased demand in our higher-margin Right Management outplacement business which had a 10 basis point offsetting impact.
Current wording
Gross profit margin decreased 50 basis points in the first half 2024 compared to the first half 2023. The decrease was primarily due to decreased activity in our higher margin Manpower staffing services, which contributed 30 basis points to the decrease, decreased activity in our permanent recruitment services which contributed 20 basis points to the decrease and decreased activity in our Experis solutions services which contributed 10 basis points to the decrease. These contributions were partially offset by increased demand in our higher-margin Right Management outplacement business which had a 10 basis point offsetting impact.
Previous wording
Selling and administrative expenses decreased -3.1% (increase of 1.3% in constant currency) in the first quarter of 2024 compared to the first quarter of 2023, primarily due to the $9.7 million favorable impact of currency exchange rates and a $4.5 million decrease in salaries from a reduction in headcount. The decreases were partially offset by the $2.4 million increase in lease and other office related costs, a $1.8 million increase in bonuses and sales commissions and a $1.6 million increase to software maintenance related costs.
Current wording
Selling and administrative expenses decreased -4.5% (-4.2% in constant currency) during the first half of 2024 compared to the first half of 2023, primarily due to the non-recurrence of $6.4 million in restructuring costs, a $6.0 million decrease in salary-related costs, a $2.3 million decrease in consulting and outside services, and a $1.8 million decrease in bonuses and sales commissions.
Previous wording
OUP in Southern Europe decreased -22.2% (-22.7% in constant currency), which represents a 3.5% OUP margin, a decrease from 4.3% in the first quarter of 2023. This OUP decrease was primarily due to decreased profitability in the France reporting unit of $11.8 million. In France, the OUP margin decreased to 3.0% for the first quarter of 2024 compared to 3.8% for the first quarter of 2023. The decrease in France was due to decreases in staffing margins and an increase in our selling and administrative expenses as a percent of revenue. In Italy, the OUP margin decreased to 6.8% for the first quarter of 2024 from 7.3% for the first quarter of 2023 primarily due to an increase in our selling and administrative expenses as a percent of revenue, partially offset by an increase in gross profit margin. In Other Southern Europe, the OUP margin decreased to 2.1% for the first quarter of 2024 from 3.0% for the first quarter of 2023 primarily due to decreases in our gross profit margin, specifically within our staffing services.
Current wording
OUP decreased -10.3% (-9.0% in constant currency), in the second quarter of 2024, which represents a 4.0% OUP margin, a decrease from 4.2% in the second quarter of 2023. This OUP decrease was primarily due to decreased profitability in the France reporting unit of $9.2 million. In France, the OUP margin decreased to 3.4% for the second quarter of 2024 compared to 3.9% for the second quarter of 2023, primarily driven by increases to selling and administrative expenses as a percent of revenue. In Italy, the OUP margin decreased to 7.8% for the second quarter of 2024 from 7.9% for the second quarter of 2023 primarily due to an increase in our selling and administrative expenses as a percent of revenue, partially offset by an increase in gross profit margin. In Other Southern Europe, the OUP margin increased to 1.9% for the second quarter of 2024 from 1.4% for the second quarter of 2023 primarily due to a decrease in our selling and administrative expenses as a percent of revenue, partially offset by decrease to our gross profit margin as we saw decreased activity in higher-margin Manpower staffing services, as noted above.
Previous wording
In Northern Europe, the largest country operations include the United Kingdom, the Nordics, Germany, the Netherlands and Belgium (comprising 35%, 19%, 15%, 11% and 9%, respectively, of Northern Europe’s revenues). In the Northern Europe region, revenues from services decreased -10.1% (-12.1% in constant currency) in the first quarter of 2024 compared to the first quarter of 2023. Within Northern Europe, we experienced revenue decreases in the United Kingdom of $35.1 million, the Nordics of $59.2 million, Germany of $8.4 million and the Netherlands of $3.3 million, which represented revenue decreases of -10.4%, -26.1%, -6.0% and -3.3%, respectively (-14.1%, -25.3%, -7.0% and -4.4%, respectively, in constant currency). These decreases were partially offset by a revenue increase in Belgium of $3.3 million, which represented a revenue increase of 4.7% (3.5% in constant currency). The revenue decrease in Northern Europe was primarily due to decreased demand of $89.9 million for our Manpower and Experis staffing/interim services, decreased demand of $18.3 million for our Experis Solutions services and decreased demand of $10.6 million in our permanent recruitment business, partially offset by the $20.1 million favorable impact of foreign currency exchange rates.
Current wording
In Northern Europe, the largest country operations include the United Kingdom, the Nordics, Germany, the Netherlands and Belgium (comprising 35%, 20%, 14%, 11% and 9%, respectively, of Northern Europe’s revenues). In the Northern Europe region, revenues from services decreased -12.1% (-12.0% in constant currency) in the second quarter of 2024 compared to the second quarter of 2023. Within our Northern Europe segment, we experienced revenue decreases in the United Kingdom of $37.7 million, the Nordics of $42.6 million, Germany of $24.8 million, the Netherlands of $2.4 million and Belgium of $4.0 million, which represented revenue decreases of -11.5%, -20.2%, -17.6%, -2.5% and -4.9%, respectively (-12.2%, -19.4%, -16.6%, -1.3% and -3.8%, respectively, in constant currency). The revenue decrease in Northern Europe was primarily driven by a $92.5 million decrease in demand for our Manpower and Experis staffing/interim services, a $20.9 million decrease in demand for our Experis solutions services and a $7.8 million decrease in our permanent recruitment services.
Previous wording
Gross profit margin decreased by 80 basis points in 2024 compared to 2023 primarily due to decreased demand in our permanent recruitment business, particularly in Manpower and Experis, which contributed 60 basis points to the decrease, decreased demand in our Experis Solutions services, which contributed 40 basis points to the decrease, and decreases in our staffing/interim margins, which contributed 40 basis points to the decrease. These contributions were partially offset by a shift in business mix towards our higher-margin Talent Solutions outplacement and MSP services, which had a 60 basis point offsetting impact.
Current wording
Gross profit margin decreased by 20 basis points in the first half of 2024 compared to the first half of 2023 primarily due to decreased demand in our permanent recruitment business, particularly in Manpower and Experis, which contributed 40 basis points to the decrease, decreased demand in our Experis Solutions services, which contributed 30 basis points to the decrease, and decreases in our staffing/interim margins, which contributed 20 basis points to the decrease. These contributions were partially offset by a shift in business mix towards our higher-margin Talent Solutions outplacement and MSP services, which had a 60 basis point offsetting impact, and the favorable impact of currency exchange rates, which had a 10 basis point offsetting impact.
Previous wording
OUP in Northern Europe decreased -99.9% (-108.6% in constant currency), which represents a 0.0% OUP margin, a decrease from 0.5% in the first quarter of 2023. This OUP decrease was primarily driven by a decrease in profitability of our bench model countries in the Nordics, which experienced an aggregate decrease of $8.5 million, partially offset by increased profitability in other bench model countries, notably Germany and the Netherlands, which experienced increases of $4.8 million and $1.0 million, respectively. The OUP decrease was partially offset by decreased selling and administrative expenses as a percentage of revenue as we saw the effects of restructuring actions taken in the prior year period.
Current wording
OUP in Northern Europe increased 49.4% (35.0% in constant currency) in the first half of 2024, which represents a -0.1% OUP margin, an increase from -0.2% in the first half of 2023. This OUP increase was primarily driven by an increase in profitability of our bench model countries, notably Germany and the Netherlands which experienced increases of $9.8 million, and $2.4 million, respectively, partially offset by a decrease in profitability in the Nordics, which experienced an aggregate decrease of $4.3 million. The OUP increase was also driven by a decrease in selling and administrative expenses as we saw the effects of restructuring actions taken in the prior year period, as noted above.
Previous wording
Revenues from services decreased -11.7% (-4.8% in constant currency and -3.6% in organic constant currency) in the first quarter of 2024 compared to the first quarter of 2023. In Japan (which represents 51% of APME’s revenues), revenues from services decreased -5.3% (increase of 6.3% in constant currency) due to the $33.2 million unfavorable impact of foreign currency exchange rates, partially offset by increased demand of $20.4 million for our Manpower and Experis staffing/interim services. In Australia, revenues from services decreased -52.9% (-51.0% in constant currency), primarily due to decreased activity of $25.3 million in our RPO permanent recruitment business driven by the non-recurrence of a government contract from the prior year period, decreased demand of $9.4 million for our Manpower and Experis staffing/interim services and the $1.3 million unfavorable impact of foreign currency exchange rates.
Current wording
Revenues from services decreased -9.7% (-2.0% in constant currency and 0.7% in organic constant currency) in the second quarter of 2024 compared to the second quarter of 2023. In Japan (which represents 51% of APME’s revenues), revenues from services decreased -3.8% (increase of 9.2% in constant currency), primarily driven by the $37.4 million unfavorable impact of currency exchange rates, partially offset by a $26.3 million increase in demand for our Manpower and Experis staffing/interim services. In Australia (which represents 6% of APME’s revenues), revenues from services decreased -46.1% (-45.4% in constant currency), primarily driven by a $21.8 million decrease in our permanent recruitment business driven by the non-recurrence of a government contract from the prior year period and a $6.7 million decrease in demand for our Manpower and Experis staffing/interim services.
Previous wording
Gross profit margin decreased 160 basis points in 2024 compared to 2023 primarily due to decreased activity in our permanent recruitment business, particularly Talent Solutions RPO, which contributed 260 basis points to the decrease and the unfavorable impact of foreign currency exchange rates, which contributed 10 basis points to the decrease. These contributions were partially offset by improvement in our staffing/interim margins, which had a 90 basis point offsetting impact, and improvements in our higher-margin Right Management outplacement services margins, which had a 20 basis point offsetting impact.
Current wording
Gross profit margin decreased 160 basis points in 2024 compared to 2023 primarily due to decreased activity in our permanent recruitment business, particularly Talent Solutions RPO, which contributed 240 basis points to the decrease, a decrease in gross profit across training solutions services, which contributed 20 basis points to the decrease, and the unfavorable impact of currency exchange rates, which contributed 10 basis points to the decrease. These contributions were partially offset by improvement in our staffing/interim margins, which had a 90 basis point offsetting impact, and increased activity in our higher-margin Right Management outplacement services, which had a 20 basis point offsetting impact.
Previous wording
Selling and administrative expenses decreased -23.7% (-17.9% in constant currency and -16.9% in organic constant currency) in the first quarter of 2024 compared to the first quarter of 2023. The decrease is primarily due to a $6.3 million decrease in salary related costs from a reduction in headcount, the $4.6 million favorable impact of currency exchange rates, a $2.8 million decrease in office lease related costs and zero restructuring costs incurred in 2024 compared to $2.5 million in 2023.
Current wording
Selling and administrative expenses decreased -23.3% (-17.1% in constant currency) in the first half of 2024 compared to the first half of 2023. The decrease is primarily driven by a $11.9 million decrease in salary related costs from a reduction in headcount, the $9.9 million favorable impact of currency exchange rates, a $7.6 million decrease in office lease costs and other office related costs and a $5.6 million decrease in consulting and outside services costs.
Previous wording
Cash used to fund our operations is primarily generated through operating activities and provided by our existing credit facilities. We believe our available cash and existing credit facilities are sufficient to cover our cash needs for the foreseeable future. We assess and monitor our liquidity and capital resources globally. We use a global cash pooling arrangement, intercompany borrowing, and some local credit lines to meet funding needs and allocate our capital resources among our various entities. As of March 31, 2024, we had $429.3 million of cash held by foreign subsidiaries. We have historically made and anticipate future cash repatriations to the United States from certain foreign subsidiaries to fund domestic operations.
Current wording
Cash used to fund our operations is primarily generated through operating activities and provided by our existing credit facilities. We believe our available cash and existing credit facilities are sufficient to cover our cash needs for the foreseeable future. We assess and monitor our liquidity and capital resources globally. We use a global cash pooling arrangement, intercompany borrowing, and some local credit lines to meet funding needs and allocate our capital resources among our various entities. As of June 30, 2024, we had $315.2 million of cash held by foreign subsidiaries. We have historically made and anticipate future cash repatriations to the United States from certain foreign subsidiaries to fund domestic operations.
Previous wording
Cash generated in operating activities was $116.0 million during the three months ended March 31, 2024, as compared to $124.6 million generated during the three months ended March 31, 2023. Changes in operating assets and liabilities generated $37.1 million and $2.4 million of cash during the three months ended March 31, 2024 and 2023, respectively. These changes were primarily attributable to the timing of collections and payments. Accounts receivable decreased to $4,458.5 million as of March 31, 2024 from $4,830.0 million as of December 31, 2023 primarily due to the revenue decline and the impact of changes in currency exchange rates. Days Sales Outstanding ("DSO") increased by one day from December 31, 2023, to 55 days as of March 31, 2024.
Current wording
Cash used in operating activities was $21.9 million during the six months ended June 30, 2024, as compared to $31.2 million used during the six months ended June 30, 2023. Changes in operating assets and liabilities utilized $191.2 million of cash during the six months ended June 30, 2024 compared to $246.0 million utilized during the six months ended June 30, 2023. These changes were primarily attributable to the timing of collections and payments. Accounts receivable decreased to $4,595.7 million as of June 30, 2024 from $4,830.0 million as of December 31, 2023 primarily due to the revenue decline and the impact of changes in currency exchange rates. Days Sales Outstanding ("DSO") increased by two days from December 31, 2023 to 56 days as of June 30, 2024.
Previous wording
Capital expenditures were $11.8 million for the three months ended March 31, 2024 compared to $13.2 million for the three months ended March 31, 2023. These expenditures were primarily comprised of purchases of computer equipment, office furniture and other costs related to office openings and refurbishments, as well as capitalized software costs.
Current wording
Capital expenditures were $23.7 million for the six months ended June 30, 2024 compared to $34.6 million for the six months ended June 30, 2023. These expenditures were primarily comprised of purchases of computer equipment, office furniture and other costs related to office openings and refurbishments, as well as capitalized software costs. The lower expenditures in 2024 compared to 2023 are primarily due to the timing of the expenditures.
Previous wording
From time to time, we acquire and invest in companies throughout the world, including franchises. For the three months ended March 31, 2024, total cash consideration paid for acquisitions, net of cash acquired, was $1.1 million, which represents a contingent consideration payment related to a previous acquisition. No cash consideration was paid during the three months ended March 31, 2023.
Current wording
From time to time, we acquire and invest in companies throughout the world, including franchises. For the six months ended June 30, 2024, total cash consideration paid for acquisitions, net of cash acquired, was $2.8 million, which represents a contingent consideration payment related to a previous acquisition. No cash consideration was paid during the six months ended June 30, 2023.
Previous wording
Our $600.0 million revolving credit agreement requires that we comply with a leverage ratio (Net Debt-to-Net Earnings before interest and other expenses, provision for income taxes, intangible asset amortization expense, depreciation and amortization expense ("EBITDA")) of not greater than 3.5 to 1 and a fixed charge coverage ratio of not less than 1.5 to 1. As defined in the agreement, we had a Net Debt-to-EBITDA ratio of 2.03 to 1 and a fixed charge coverage ratio of 3.17 to 1 as of March 31, 2024. Based on our current forecast, we expect to be in compliance with our financial covenants for the next 12 months.
Current wording
Our $600.0 million revolving credit agreement requires that we comply with a leverage ratio (Net Debt-to-Net Earnings before interest and other expenses, provision for income taxes, intangible asset amortization expense, depreciation and amortization expense ("EBITDA")) of not greater than 3.5 to 1 and a fixed charge coverage ratio of not less than 1.5 to 1. As defined in the agreement, we had a Net Debt-to-EBITDA ratio of 2.71 to 1 and a fixed charge coverage ratio of 3.14 to 1 as of June 30, 2024. Based on our current forecast, we expect to be in compliance with our financial covenants for the next 12 months.
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Current report — wording carried from elsewhere
The following table presents selected consolidated financial data for the six months ended June 30, 2024 as compared to 2023.
Current report — wording carried from elsewhere
The year-over-year decrease in revenues from services of -7.1% (-4.5% in constant currency and -4.3% in organic constant currency) was attributed to:
Current report — wording carried from elsewhere
The year-over-year 60 basis point decrease in gross profit margin was primarily attributed to:
Current report — wording carried from elsewhere
a 60 basis point unfavorable impact from decreases to permanent recruitment, including Talent Solutions RPO, as permanent hiring demand continued to soften and experienced reduced levels; and
Current report — wording carried from elsewhere
a 20 basis point unfavorable impact from the decrease in staffing/interim margins due to mix shifts and lower volumes while pricing remained stable; partially offset by
Current report — wording carried from elsewhere
a 10 basis point unfavorable impact from changes in currency exchange rates.
Current report — wording carried from elsewhere
Interest and other expenses, net is comprised of interest, foreign exchange gains and losses and other miscellaneous non-operating income and expenses, including those associated with noncontrolling interests. Interest expense, net was $25.7 million in the first half of 2024 compared to $22.2 million in the first half of 2023 primarily due to increased revolver and other short-term borrowings at a higher interest rate during the period. Foreign exchange loss, net was $4.2 million in the first half of 2024 compared to $8.2 million in the first half of 2023 primarily due to a reduction in foreign currency exchange losses year over year. Miscellaneous income, net was $12.8 million in the first half of 2024 compared to $11.1 million in the first half of 2023.
Current report — wording carried from elsewhere
We recorded income tax expense at an effective rate of 33.4% for the six months ended June 30, 2024, as compared to an effective rate of 30.6% for the six months ended June 30, 2023. The 2024 rate was unfavorably impacted by the lower level and overall mix of earnings and partially offset by the scheduled reduction in the French business tax rate from 0.38% to 0.28% effective January 1, 2024. The 33.4% effective tax rate for the first half of 2024 was higher than the United States Federal statutory rate of 21% primarily due to the French business tax, tax losses in certain countries for which we did not recognize a corresponding tax benefit due to valuation allowances, and the overall mix of earnings.
Current report — wording carried from elsewhere
Net earnings per share - diluted was $2.05 in the first half of 2024 compared to $2.80 in the first half of 2023. Losses related to our Proservia Germany wind down in the first half of 2024 unfavorably impacted net earnings per share - diluted by approximately $0.19, net of tax, in the first half of 2024.
Current report — wording carried from elsewhere
Gross profit margin decreased 60 basis points in the second quarter of 2024 compared to the second quarter of 2023 primarily due to decreased margins in our staffing and interim services, particularly within Experis, which contributed 50 basis points to the decrease, decreased activity in our permanent recruitment business which contributed 50 basis points to the decrease and decreased margins in our Talent Solutions outplacement business which contributed 10 basis points to the decrease. These contributions were partially offset by the favorable impact of currency exchange rates, which had a 50 basis point offsetting impact.
Current report — wording carried from elsewhere
Gross profit margin decreased 160 basis points in 2024 compared to 2023 primarily due to decreased activity in our permanent recruitment business, particularly Talent Solutions RPO, which contributed 230 basis points to the decrease and decreased gross profit across training solutions services, which contributed 20 basis points to the decrease. These contributions were partially offset by improvement in our staffing/interim margins, which had a 90 basis point offsetting impact.
Current report — wording carried from elsewhere
In millions for the six months ended June 30, 2024.